Are MLA salaries too low?

The province’s MLA Compensation Review Commission is asking for written submissions relating to MLAs salaries, expenses and allowances until Sept. 30, but John Williamson of the Canadian Taxpayers Federation says the public isn’t seeing the whole picture.

The call for submissions issued by the commission includes a questionnaire which states that New Brunswick MLAs receive a salary of $45,347.29, while their Nova Scotian counterparts receive $81,805 per year.

However, that analysis discounts the fact that New Brunswick politicians receive a non-taxable allowance of $22,674, which has a real value of $36,902 once taxed. That means New Brunswick MLAs receive a total of $82,249 before taxes, which is slightly more than MLAs in their neighbouring province.

“The commission has downplayed this portion, leaving the impression that New Brunswick lawmakers are underpaid compared to their counterparts across the border,” says Williamson.

“There is no way this debate should be used as an excuse to suggest New Brunswick MLAs are underpaid compared to Nova Scotia, that is simply not true.”

Despite the fact that the tax-free portion is noted in smaller typeface elsewhere on an accompanying document, Williamson says he can sense “a bit of a con job.”

The commission, which is headed by retired Court of Appeal Justice Patrick A.A. Ryan was created on the basis that being a member of the provincial legislature is no longer a part-time endeavour, but a full-time job. The fact that MLAs have not received a substantial pay hike other than adjustments to account for inflation, since 1980, is also cited as a reason that prompted the commission.

Ryan was unavailable for comment yesterday.

The public is invited to weigh in on whether they feel the compensation of MLAs is done in a sufficiently transparent manner; whether the structure of pensions should move from a model that is subsidized by taxpayers to an RRSP model. The commission is also looking at whether a pay increase could attract more qualified candidates to Fredericton, and whether the tax-free allocation should be abolished.

Williamson says he feels the debate is already being directed toward a pay increase that he predicts could be as high as 20 per cent.

“It likely won’t be a small adjustment to account for inflation,” he says.

He has already sent the federation’s brief condemning the tax-free allocation model as well as New Brunswick’s current pension model, which he qualifies as “gold-plated.”

Pointing to decisions in Prince Edward Island and Newfoundland and Labrador to abolish tax-free allocations, Williamson says the practice is obsolete and lacks accountability.

Newfoundland and Labrador set its indemnity at $92,580 as of July 1, 2007. Looking across the country, P.E.I. pays its MLAs the least, at $62,500, while Ontario pays its MLAs the most with $110,775.

Manitoba and Saskatchewan, which have populations that hover slightly above and below one million people, pay their MLAs just above $74,000.

Williamson says a decade ago it was a common practice across Canada to dispense the tax-free allocations, but notes that only four provinces still function in that manner after like-minded commissions have nixed the allocations one by one.

“At the end of the day Canadians expect lawmakers to live under the same laws that are applied to the rest of Canadians,” he says, “they should be subject to the same taxes they place on citizens.”

Williamson says the public should not be tricked into thinking the tax free allocations are simply expense funds.

Charles Cirtwill, the acting president of the Atlantic Institute for Market Studies, says it is important to review MLAs salaries as a factor in attracting strong candidates, but notes that compensation must be viewed in a larger context.

“You get what you pay for, if you are trying to attract a certain person to the legislature it may well be that the salary is a motivating factor,” he says, noting the call of public service draws more people to the process than money.

“The fact is that salaries are only going to be an incentive for a certain type of individual.” For instance, lifestyle changes are one of the major trade-offs considered by potential candidates, he says.