10/19/2012 01:47 EDT | Updated 12/19/2012 05:12 EST

Alberta PCs Golden Handshakes: New Transitions Allowance Pitched For Departing Politicos


EDMONTON - Alberta's governing Progressive Conservatives are pitching to bring back a plan that paid millions of dollars to retiring politicians — but in a much leaner form.

The Tories used their majority on the all-party member services committee Friday to pass a motion asking the legislature to consider reinstituting transition allowances, but under a different name.

They also passed a motion asking the legislature to make a new politician pension plan a straight-up RRSP. But taxpayers would pay the full contribution of $23,000 a year for each politician rather than half as originally proposed.

Government whip Steve Young, who proposed the motion, said it's a fair package that adequately compensates those who put their private careers on hold to serve as MLAs.

"We need to be clear and we need to be transparent," said Young.

"What (the remuneration) was before was too much. We needed to have one that reflects their transition back into public life and have a reasonable amount of (retirement) funds associated with that.

"MLAs are basically on four-year contracts."

The recommendations are to be reviewed by the entire legislative assembly, which begins its fall sitting Tuesday.

Young's proposal would see a politician who retired or was defeated receive one's month pay for every year of service up to 12 years.

The new payment, to be called a severance allowance, would replace the previous one that paid three months of salary for every year of service, with no limit on total years.

That resulted in $10.6 million being paid to 25 outgoing MLAs in the spring election, including $1 million for Speaker Ken Kowalski alone.

Premier Alison Redford and the Tories got an earful from angry voters over the allowance on the hustings, which prompted her to suspend the payments going forward.

Young's motion is the same as a private member's bill that was unsuccessfully put forward by an Opposition Wildrose MLA last year.

Wildrose Leader Danielle Smith, who participated in Friday's meeting by speaker phone, said she would have voted for the motion had the Tories not tied it to the RRSP pension plan.

While the RRSP option was the cheapest and most transparent of three pension options the committee examined, Smith said it sends the wrong message, given that ordinary wage-earning Albertans still have to contribute to their retirement.

"We're trying to get the kind of proposal that is available in the real world," Smith told the committee.

"I don't believe taxpayers want to see an enriched RRSP payment that sees MLAs pay zero dollars toward their own contribution."

The committee voted earlier this year to adopt a single $134,000 base salary for MLAs.

Later, in an interview, Smith said taxpayers will not go for "rich benefits" to politicians "when we're facing a $3-billion deficit (and) a crisis in health care.

"There's absolutely no way that any one of those PCs would have got elected if this is what they'd campaigned on in the last election."

Alberta Liberal Leader Raj Sherman abstained from the vote. He has said politicians should not be entrusted to set their own pay. Friday's motion on new allowances and topped-up contributions underscores his point, he added.

"This is a joke and a farce," Sherman told the committee. "This is truly why we need a wholly independent process."

Derek Fildebrandt of the Canadian Taxpayers Federation said the RRSP pension option is the sound way to go, but politicians should have to make some contributions.

"MLAs need to have some skin in the game when it comes to their own pensions," he said in a news release.

Fildebrandt also called on the Tories to keep the promise made by Redford to scrap all transition allowances.

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