Democracy Gone Astray

Democracy, being a human construct, needs to be thought of as directionality rather than an object. As such, to understand it requires not so much a description of existing structures and/or other related phenomena but a declaration of intentionality.
This blog aims at creating labeled lists of published infringements of such intentionality, of points in time where democracy strays from its intended directionality. In addition to outright infringements, this blog also collects important contemporary information and/or discussions that impact our socio-political landscape.

All the posts here were published in the electronic media – main-stream as well as fringe, and maintain links to the original texts.

[NOTE: Due to changes I haven't caught on time in the blogging software, all of the 'Original Article' links were nullified between September 11, 2012 and December 11, 2012. My apologies.]

Wednesday, March 27, 2013

Taxpayers paying more than $25 for every dollar politicians contribute to MP pensions

OTTAWA — Canadians continue to pay more to fund a “gold-plated” parliamentary pension plan that spending watchdogs say has taxpayers ultimately contributing more than $25 for every dollar from MPs.

The federal government announced last fall it is overhauling the parliamentary pension plan — including tripling MP contributions and increasing retirement age — after the next election.

The changes can’t come soon enough for many Canadian taxpayers, who are increasingly shouldering the burden of a lucrative parliamentary pension plan, according to a new report tabled this week in the House of Commons.

For the 2011-12 fiscal year, taxpayers contributed approximately $29.4 million to the parliamentary pension plan, while MPs and senators contributed only $4.7 million — meaning Canadians paid nearly $6.25 for every $1 paid by federal politicians.

Taxpayer contributions to the pension fund increased 10% last year, compared to an increase of less than 4% for MPs and senators.

But when you factor in the more than $90 million in interest and adjustments (eventually covered by taxpayers) attached to the two different MP pension accounts, Canadians are ultimately paying $25.50 into the parliamentary pension plan for every dollar contributed by the politicians, says the Canadian Taxpayers Federation.

The average annual pension in 2011-12 was $58,051 for former MPs (up from $55,102 the previous year) and $66,218 for former senators (compared to $60,599 the previous year).

The plan is so “gold-plated” that even with the government’s trumpeted changes to increase MP contributions, it will be difficult for the plan to break even when the reforms are implemented, says Gregory Thomas, federal director of the Canadian Taxpayers Federation.

“We’re not sold that this plan is going to break even until they stop the gold-plated payouts,” Thomas said in an interview. “It’s tough to see the math working out.”

Total payments in the plan for 2011-12 increased 15% from a year earlier to approximately $56 million, as more former politicians tapped the pension.

There were 84 former parliamentarians (67 former MPs, 17 former senators) receiving annual pensions of $90,000 or more in 2011-12 — up from 59 the previous year.

All told, in 2011-12 there were 547 former federal politicians receiving parliamentary pensions, with 162 survivors and eight dependant children or students receiving allowances.

Interestingly, two former MPs had their parliamentary pensions suspended because they cannot be located. No further details were provided.

Under the reforms adopted last fall 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.

After the next election, expected in 2015, MPs will also have to wait until age 65 to collect their full pension, instead of the current age of 55. There were no changes to the eligibility rules that stipulate an MP qualifies for the pension plan after serving six years in office.

The government expects the changes will save taxpayers $29 million over five years.

Also, the reforms substantially cut the additional pension plan for prime ministers who serve more than four years, in a move that will almost certainly cost Prime Minister Stephen Harper more than $1 million over the course of his lifetime.

A spokesperson for Treasury Board president Tony Clement said the Conservative government has acted to introduce more fairness to the parliamentary pension plan and ensure MPs pay their fair share.

“The Harper government was the first to make historic changes to the public service and MP pensions. These reforms introduce a 50-50 cost-sharing model for the first time, resulting in substantial savings for Canadian taxpayers,” Andrea Mandel-Campbell said in an email.

Original Article
Source: nationalpost.com
Author: Jason Fekete

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