Canada: Federal Conservatives Want to Fix Everyone Else’s Pensions/Benefits, But Not Their Own

Update: see previous post – December 31, 2013 Harper must defend consumers in mail cuts: Roseman, December 11, 2013 Canada Post: We Won’t Deliver (To Urban Homes Anymore)

Parliment of Canada - MP's generally serve a four (4) year term.  If they are elected for a second term, they qualify for a pension after six (6) years.  The pensions they receive are not even close to pensions offered to employees in the private sector.
Parliment of Canada – MP’s generally serve a four (4) year term. If they are elected for a second term, they qualify for a pension after six (6) years. The pensions they receive are not even close to pensions offered to employees in the private sector. Conservative Prime Minister Stephen Harper and Treasury Board President Tony Clement and the Conservative Party following the November 2012 Conservative Bi-Annual Convention in Calgary, agreed to attack Pensions and Benefits of Federal Public Civil-Servants and to reduce their pensions/benefits to the same level as private sector workers.  Unfortunately, the same conservatives are not interested in pursuing or reducing the most expensive federal public sector pensions/benefits, those held by Senators & MP’s.

Imagine working only six (6) years and retiring with a pension, indexed to inflation for the rest of your life.  Conservative Party Members of Parliment (MP’s) receive lifelong pension payments once they have achieved six (6) years in Parliment.  This means that as long as they are elected to two (2) terms in office, they meet the eligibility requirements to collect a monthly pension payment for the rest of their lives.

But this same party (Conservatives) who presently hold a majority in the House of Commons and the Prime Minister, Stephen Harper held a Conservative Party convention in Calgary ending in November, 2012, at which they moved and carried a number of motions that directed the Prime Minister and the President of the Treasury Board, Tony Clement to attack the pensions of federal public sector employees when their collective agreements were to be renewed in future negotiations.

President of the Treasury Board Tony Clement explained in the summer of 2013 why he thought it was important to take away sick leave days from federal servants and why he thought that the pension plans that those employees had, should be changed. Mr. Clement felt energized by two things:

  • The omnibus Bill C-60, the bill – unamended – received Royal Assent on June 26, 2013, and
  • Motions (on reducing federal servant pensions and benefits) that were brought up, which he spoke on and which were ultimately carried at the Conservative Convention on November 2, 2012.Mr. Clement has waged a war on federal servants, on their negotiated pension plans, on their negotiated benefit programs and on their negotiated sick leave provisions. The Conservative party doesn’t like them, so he doesn’t like them and he calls himself chief negotiator for all pubic-sector unions at all future contract negotiations.

There are 49 Crown Corporations and as a result of Bill C-60, Treasury Board President Tony Clement or his designate will be sitting at all future negotiations in the future with Crown Corporations.  At these negotiations he has already indicated that he will attack public-sector pension plans/benefit plans/leave provisions, etc. and will try to bring them into line with the private-sector.  He has already said that he wants to focus in on Crown Corporations Canada Post, CBC and Via Rail, when their collective agreements come up for renewal.

If he is commited to ensuring that all Federal Servants have a reduced pension, reduced benefits and reduced leave provisions so that Canadian’s tax money isn’t being spent, why hasn’t that mandate from the Consevative Party been extended to the Prime Minister Stephen Harper, the Conservative dominated Senate and all Conservative MP’s as well as elected MP Tony Clement, who has been appointed as the President of the Treasury Board?

Treasury Board President Tony Clement has taken no steps to radically change the Pension, Benefits and Leave Provisions for unelected Senators, a majority of whom are Conservatives and most have been appointed by Conservative Prime Minister, Stephen Harper.

If it is private sector standards that the Conservative party is demanding of public-sector pension plans, benefit plans and leave provisions, then why isn’t the Conservative party demanding the same of Conservative Senators, Conservative Members of Parliment, including the Prime Minister and the President of the Treasury Board?

The Senate:

The Senate Chamber or the Red Chamber.  The Senate studies, amends and either rejects or approves bills passed by the House of Commons. It can also introduce its own bills, except those to spend public money or impose taxes, which must be introduced in the House of Commons. No bill can become law until it has been passed by the Senate. Senators also study major social, legal and economic issues through their committee work. One of the duties of the Senate is to represent the interests of Canada's regions, provinces, territories and minority groups. Seats in the Senate are distributed to give each major region of the country equal representation. The Senate has 105 members. Senators are appointed by the Governor General on the recommendation of the Prime Minister and hold office until age 75.
The Senate Chamber or the Red Chamber. The Senate studies, amends and either rejects or approves bills passed by the House of Commons. It can also introduce its own bills, except those to spend public money or impose taxes, which must be introduced in the House of Commons. No bill can become law until it has been passed by the Senate. Senators also study major social, legal and economic issues through their committee work.
The Senate has 105 members. Senators are appointed by the Governor General on the recommendation of the Prime Minister and hold office until age 75.

Before Stephen Harper became prime minister, he called for senators to be elected as a Triple “E” Senate (The ‘Triple E’ stands for equal, elected and effective) as Alberta had been doing since 1989 (four elections of Alberta Senators have cost taxpayers $11 million).

In 2011 the Conservative party introduced a bill to reform the Senate, but have refused to deal with it and pass the legislation that currently sits in the House of Commons. Before he was elected in 2006, he said in 2004 ” the Upper House (the Senate) remains a dumping ground for the favoured cronies of the the Prime Minister”.

Michael Dennis "Mike" Duffy born in Charlottetown, the capital of Prince Edward Island on May 27, 1946 (67-years-old). The disgraced Senator may have brought down Prime Minister Harper (the man who appointed him in 2009) through his actions and subsequent relevations.Senator Mike Duffy, with his troubled expense claims, was the catalyst this year for a push to reform how MPs and senators handle their expense accounts. ( Sean Kilpatrick/Canadian Press)
Michael Dennis “Mike” Duffy born in Charlottetown, the capital of Prince Edward Island on May 27, 1946 (67-years-old). The disgraced Senator may have brought down Prime Minister Harper (the man who appointed him in 2009) through his actions and subsequent relevations. Senator Mike Duffy, with his troubled expense claims, was the catalyst this year for a push to reform how MPs and senators handle their expense accounts. ( Sean Kilpatrick/Canadian Press)

Since he has said this, he has appointed a third of all senators in the Upper House. In 2009, five years after he made this statement, Prime Minister Stephen Harper appointed twenty-seven (27) of his favoured cronies as unelected Senators. He appointed five (5) more unelected senators in January, 2013. Senators are appointed by the Governor General, based on the recommendation of the Prime Minister. Currently the Conservative Party holds 65 out of the 105 available Senate seats.

The Senate is expensive to maintain.  It costs taxpayers $106,264,111 a year and on top of that, all pension contributions made for all 105 senators.

How much does your senator earn?

Sessional allowances and additional salaries for all parliamentarians — MPs and senators — were frozen at the 2009-10 fiscal year level until the end of the 2012-13 fiscal year. Since the 2012-13 fiscal year is over, pay raises have kicked in for senators and MPs on April 1. While MPs gave themselves a 1.6 per cent increase on April 1, 2013, that decision for senators translated into an approximately 2.3 per cent wage increase.

Sessional Allowance (base salary) = $135,200

Bonus for being Speaker: $56,000

Bonus for being deputy Speaker: $23,100

Bonus for being leader of the government in the Senate: $76,700

Bonus for being Senate opposition leader: $36,500

Bonus for being deputy government leader: $36,500

Bonus for being deputy opposition leader: $23,100

Bonus for being government whip: $11,200

Bonus for being opposition whip: $6,600

Bonus for being deputy government whip: $5,600

Bonus for being deputy opposition whip: $3,100

Bonus for being chair government caucus: $6,600

Bonus for being chair opposition caucus: $5,600

Bonus for being committee chair: $11,200*

Bonus for being committee vice-chair: $5,600*

(*=Excluding standing joint committee on the Library of Parliament)

Source: Senate of Canada

A senator makes $135,200 a year in salary plus expenses, which can climb as high as $300,000.00 annually. In addition to the salary and expenses, senators earn even a larger salary if they act as a committee chair or speaker.

Senators must be at least 30-years-old and can work up to the age of 75-years-old and only have to work three (3) days a week for 29 weeks a year. You would think that 3 x 29 = 87 days per year, but the average time that the senate has been sitting since Prime Minister Harper took power in 2006 is seventy (70) days per year.  In fact, the only year that the senate actually sat for 87 days was in 2012, no other year since 2006.

Since Prime Minister Harper took power in 2006, this is the total number of days that the Senate was sitting, between 2006 to 2013:

In 2013, the Senate was only sitting for 76 days
In 2012, the Senate was only sitting for 88 days
In 2011, the Senate was only sitting for 64 days
In 2010, the Senate was only sitting for 79 days
In 2009, the Senate was only sitting for 83 days
In 2008, the Senate was only sitting for 56 days
In 2007, the Senate was only sitting for 76 days
In 2006, the Senate was only sitting for 62 days

Total number of days available for Senators to work in the Senate, when it is sitting, over eight (8) years is 584 days. 584 days divided by 8 years = 70 days on average, per year.

For most Canadians in the private sector (which is the yardstick that Conseratives want to use against public civil servants) 70 days represents three (3) and a half months (each month holds 20 working days).

How can Tony Clement (President of the Treasury Board and Conservative) and Federal Conservatives allow imbalance to exist, when Pensions and Benefits should be the same or comparable to the private sector?

In order for a Senator to be eligible to begin to collect a pension at the age of 55, they only have to work, at the very maximum, 70 days a year for six (6) years or a total of 420 days or 21 months (less than two years of work).  How can the Federal Conserative party or the leadership allow this ridiculous situation to exist, given their zeal to tear down anyone’s pension in the federal sector and modify it to be as close to the private sector as possible?

In September 2003, Marc Harb was appointed to the Canadian Senate on Chrétien’s recommendation. Amidst scandal, Harb decided to resign on August 26, 2013 (almost ten years later) and to begin to collect his fully indexed pension, starting at $123,000.00 a year.

The three (3) Conservative Senators who were recently suspended, will have the suspension time counted for the purposes of pension eligibility and will be able to collect a $24,000 pension (indexed thereafter) annually, at the end (6 years) in the senate.

Senator Rod Zimmer was appointed in 2005. He recently retired from the Senate at the age of 70. Based on his 8 years in the Senate, he will collect a yearly pension of $31,601, indexed for inflation. Who can work for about 21 months and expect to collect a yearly pension of $31,000 that will increase regularily, because it is fully indexed. Will Tony Clement or the Conserative party take any steps to stop this? Who in the private sector could expect to collect this type of yearly pension, after only contributing about 21 months of work in any private sector company?

Senate administration revealed that the two-year suspensions of Mike Duffy, Pamela Wallin and Patrick Brazeau will count toward their pension eligibility. Prime Minister Harper rewarded his three (3) buddies by appointing them as Senators in January, 2009. By January, 2015, the three senators will have acquired the six years of service needed to be eligible for pensions worth at least $24,000 they can collect when they turn age 55. These senators don’t have to show up at all for work, and they will collect $24,000 a year for life (increasing as it is indexed based on inflation), beginning at the age of 55-years-old. Is this the type of situation that Tony Clement wants to fix or at least attempt to fix?

Federal MP’s Salaries & Pensions:

(see source)

As of 2010, the yearly salary of each Member of Parliament was $157,731.00.

2013-14 Salaries of Canadian Members of Parliament (source)

The salaries of Canadian Members of Parliament (MPs) are adjusted on April 1 each year. Increases to the salaries of members of parliament are based on an index of base-wage increases from major settlements of private-sector bargaining units maintained by the federal Department of Human Resources Development.

For 2013-14 the salaries of members of parliament were increased by 1.6 perecent. This is the first pay increase for MPS since their salaries were frozen in 2010 as an austerity measure. The base salary for senators went up to $135,200 from $132,300 — an increase of $2,900 — on April 1, the same day salary increases kicked in for MPs, whose base salary rose to $160,200 from just under $158,000, for an increase of about $2,500.

Base Salary of Members of Parliament

All members of parliament make a basic salary of $160,200.

Extra Compensation for Additional Responsibilities

MPs who have extra responsibilities, such as the Prime Minister, Speaker, Leader of the Opposition, Cabinet Ministers, Ministers of State, Leaders of other parties, parliamentary secretaries, party house leaders, caucus chairs, and chairs of House of Commons committees, receive additional compensation.

TitleAdditional SalaryTotal Salary
Member of Parliament$160,200
Prime Minister*$160,200$320,400
Speaker*$  76,700$236,900
Leader of the Opposition*$  76,700$236,900
Cabinet Minister*$  76,700$236,900
Minister of State$  57,500$217,700
Leaders of Other Parties$  54,500$214,700
Government Whip$  28,800$189,000
Opposition Whip$  28,800$189,000
Other Party Whips$  11,300$171,500
Parliamentary Secretaries$  16,000$176,200
Chair of Standing Committee$  11,300$171,500
Caucus Chair – Government$  11,300$171,500
Caucus Chair – Official Opposition$  11,300$171,500
Caucus Chairs – Other Parties$    5,700$165,900
*The Prime Minister, Speaker of the House of Commons, Leader of the Opposition and Cabinet Ministers also get a car allowance.

The Federal Conservatives  have changed some of the pension rules, but the payouts remain the same – a bonanza.

The federal government recently adopted changes to the parliamentary pension plan — including tripling MP contributions and increasing retirement age — but these take effect after the next election.

Under the reforms (Bill C-46) adopted by the Conservative government, annual pension contributions for MPs will increase to nearly $39,000 by 2017 — from about $11,000 currently — bringing parliamentarians’ contributions up to a 50-50 split between the government and the individual MP.  The lucrative MP pensions however, remain the same and are fully funded by the Canadian taxpayer.

Treasury Board President Tony Clement spoke about Bill C-46, which became law on Jan.1/13 and said: “I think when you’re looking at ways to respect taxpayers it is important to lead by example and that’s exactly what were doing”. If Mr. Clement and the Conservative Party wants to lead by example, then he must begin by bringing MP’s & Senators pensions and benefits in line with the private sector – but has taken no steps to do so – the pensions are still lucrative and the benefits are still amazing.

The pension plan for members of Parliament and senators will pay many longtime MPs more than $100,000 a year for the rest of their lives. Indexed to inflation, the plan will pay millions of dollars each to MPs should they live until age 90 (the average life expectancy of MPs in the pension plan, according to the government’s own actuary).

Cabinet ministers are paid higher salaries and accrue larger annual pension benefits than backbench MPs, meaning their yearly and total payouts are generally larger.

The significant hike in MP contributions will likely have some federal politicians reconsidering whether they want to seek re-election in 2015, having to give up a significantly larger portion of their paycheques after that.

Those parliamentarians who do call it quits will have a golden parachute on their way out the House of Commons doors.

Potential Payouts

Here’s a list of some of the potential payouts to longer-serving MPs as well as cabinet ministers not seeking re-election, as calculated by the Canadian Taxpayers Federation (assuming MPs don’t run again in 2015 and live until age 90)

Public Safety Minister Vic Toews

– elected in 2000; minister since 2006

– if he leaves cabinet this month but remains MP until 2015, annual pension of approximately $90,000; total lifetime pension of about $3.2 million to age 90

Minister of State of Foreign Affairs Diane Ablonczy

– elected in 1993; minister/secretary of state since 2007

– if she leaves cabinet this month but remains MP until 2015, annual pension of about $130,000 a year, total lifetime pension of about $4 million to age 90

Liberal MP and former cabinet minister Ralph Goodale

– elected 1974-79; 1993 to present (served in cabinet for the Chretien and Martin governments)

– annual pension of around $165,000 if he sits until 2015, total lifetime pension of more than $5 million until age 90

Liberal MP Jim Karygiannis

– elected in 1988

– annual pension of approximately $119,000, total lifetime pension of more than $4.8 million until age 90

New Democrat MP Pat Martin

– elected 1997

– annual pension of more than $93,000; total lifetime pension of about $3.8 million until age 90

Bloc Quebecois MP Louis Plamondon

– elected in 1984

– annual pension of approximately $119,000; total lifetime pension of more than $2.5 million until age 90.

Members of Parliament report published on Monday.

MPs spent more than $67 million in employees salaries and service contracts, $25 million in travel expenses, and $15 million in office expenses including cellphones and postage.

Members of the House of Commons also spent more than $6 million in printing expenses, including mailings to constituents in their ridings and partisan flyers known as “10-percenters” to addresses outside their own ridings, more than $5 million in advertising costs and more than $1.6 million in hospitality and other events spent a combined $123.6 million in overall expenses for the fiscal year ending on March 31, 2013, up $2.3 million over the previous year, according to a yearly Commons report.

MPs spent more than $67 million in employees salaries and service contracts, $25 million in travel expenses, and $15 million in office expenses including cellphones and postage.

Members of the House of Commons also spent more than $6 million in printing expenses, including mailings to constituents in their ridings and partisan flyers known as “10-percenters” to addresses outside their own ridings, more than $5 million in advertising costs and more than $1.6 million in hospitality and other events.

10 highest MP expenses

  1. Steven Fletcher (Charleswood-St. James-Assiniboia Conservative), $612,259.38
  2. Tom Mulcair (Outremont, NDP), $550,830.72
  3. Blake Richards (Wild Rose, Conservative), $547,510.07
  4. Niki Ashton (Churchill, NDP), $528,637.83
  5. Hedy Fry (Vancouver Centre, Liberal), $516,429.74
  6. Richard Harris (Cariboo-Prince George, Conservative), $515,243.90
  7. Peter Penashue (Labrador, Conservative), $513,713.99
  8. Brian Storseth (Westlock-St. Paul, Conservative), $502,858.26
  9. Leona Aglukkaq (Nunavut, Conservative), $501,867.71
  10. Gerry Breitkreuz (Yorkton-Melville, Conservative), $501,493.95

In September, 2013 Prime Minister Stephen Harper released a list of 32 Conservative MP’s who will become parliamentary secretaries, a post that carries a $16,000 wage hike for assisting members of the 38-member cabinet. Like the appointment of Senators to help assist with the mandate of the Conservative party, Harper appointed these MP’s to reward backbenchers and prevent those upset in the party from revolting in caucus.

What is the Conservative Party or Tony Clement, the President of the Treasury Board or Prime Minister Stephen Harper going to do about the pensions or benefits that are received by the Senators (most of whom Harper has appointed) or MP’s (Members of Parliment, most of whom are Conservative)? Are they going to lower these pensions in line with the private sector (from defined contribution to defined benefit)?

 

 

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