Wednesday, February 1, 2012

The case for MP's Pensions

Published in The Prince Arthur Herald

In recent weeks we’ve seen an increased call for federal Members of Parliament to reform their pension plans.  The Canadian Taxpayers’ Federation called it a “national disgrace” for MP’s to reward themselves with one of the most handsome pensions in Canada.  Bill Robson of the C.D. Howe Institute said “The kind of pension plan we should be promising our leaders should be somewhere in the middle — more generous than what the ordinary Canadian currently gets, but less generous than what the MPs are currently promising themselves.”

The populist notion that all MP’s hold their fair share considering Canada’s austerity measures to balance the budget seems strong, yet MP’s cannot possibly respond without becoming entrapped as defenders of their own financial interests, or conceding to auctioning away their own pensions.

We must consider the broader picture of the role of an MP, what they do, and whether they’re really fairly paid as it is.  Indeed, while it is clear MP’s pensions must be reformed, it is equally as clear that they are underpaid as it is.

The average career of an MP is just five years. That’s not a lot of job security for someone in a position which determines the directions, investments, and strategies of the federal government.

Consider also that an MP’s salary is just $157,731 per year.  Sure, there are additional allowances for holding additional responsibilities, but think for a second about the number of hours an MP works per week, compared to the average Canadian.

MP’s are also highly public figures, subject to rigorous scrutiny, media attention, and generally live life under the constant watch of the cameras and reporters.  Indeed, nowhere but in politics is a person’s personal life – their health, their family, their spouse, whether they smoke or drink – on constant display and constantly becoming part of the permanent public record.

The average week of a Member of Parliament begins Monday morning with the House sitting at .  This means Members must be in Ottawa Sunday night, or before sunrise on Monday morning, so they can attend briefings, check-in with office staff, and prepare for the week ahead.  When the House is adjourned at Members still have more work: they may attend social gatherings, caucus meetings, committee preparations, speaking engagements, or welcome a constituent to their Parliamentary office and take them for a tour.

Members also belong to one or several committees, which sit from to 40 hours per week and can travel across country to study or observe first-hand issues relevant to the committee.

There are also caucus meetings for each party, which conduct regional, provincial, and national meetings each week to discuss business, policy, strategy, and vet the important issues to be discussed throughout the week.  Each caucus can take an additional 2-6 hours per week, depending on what the party determines.

Remember, we are already well over 40 hours a week of work and this is only a base level of work.  Consider MP’s that are tabling bills; ministers who have ministries to run; Parliamentary Secretaries; Mp’s who are also committee chairs; and so forth.

Jason Kenney, Minister of Citizenship and Immigration, is famous for working from the early hours of the morning until the wee hours of the night. Indeed, he was voted 2011’s hardest working Parliamentarian by his fellow MP’s because he’s estimated to work 20-hour days. Sleep takes a backseat in the minister’s life, who commits his morning, day, and evening to parliament, then returns to his office at night, commonly until , to oversee his department.

It does not end there.  MP’s, after all, have constituencies to run.  So Friday evening they return to their constituencies for another two days of meeting constituents, attending groundbreaking ceremonies, and assisting constituents with navigating various government programs.

An MP can easily top 80 hours of work between Monday and Friday alone, then spend several hours in their constituency.  Suddenly, $157,731 per year doesn’t seem like so much for what works out to be 4160 hours per year.  Indeed, it works out to just $37.91 an hour, yet their duties as a lawmaker, parliamentarian, arbitrator, ombudsman, consultant, and analyst are worth much more.

Compare this salary to those in the private sector, such as Boards of Directors and high-level positions, and you’ll mind they can rake in millions of dollars per year as well as healthy pensions.  These are valuable minds, and they are paid for their expertise.

The result of underpaying MP’s is twofold.  One is that people do not possess the desire to run for public office.  The other is that MP’s are compensated for their work and the issues laid out above by receiving a handsome pension.

Are there flaws in this system?  Absolutely.  Gilles Duceppe, the man who made a career out of attempting to break up Canada, is going to receive an annual $140,000 pension.  That is simply unacceptable, but it is the result of allowing the Bloc Quebecois to be a national political party in the first place.

It is also an issue that for every $1 put into a pension fund by the Member, Canadian taxpayers put in $5 according to the CBC, or $23 according to the Canadian Taxpayers’ Federation.  Private pension systems are commonly matched dollar for dollar, but not 5:1.

The CBC complaining the 32 year-old Parliamentary Secretary Pierre Poilievre will receive a minimalist $30,000 a year pension is not an issue.

MP’s are stuck in a no-win situation.  If they perpetuate their current pension system they risk becoming labelled as opportunists looking out for their own material gain while Canadians struggle in uncertain economic times; if they change their pension system they’re legislating themselves even further into an already underpaid profession.

The answer, following the C.D. Howe Institute, is to raise salaries if we’re going to cut pensions.  This should be done by an independent arbitrator reporting to the Board of Internal Economy, just until the NDP inevitably complains the arbitrator costs too much.

Reforms to MP’s pensions must be made, but we must not forget that we are already underpaying our nation’s lawmakers as it is.