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March 23, 2010

Tough Decisions - MLA Pay Indexing

It almost makes me ill when I hear members of the government talk about making "tough decisions" at a time when the government is running a $1.7 billion deficit. As happened with its fall 2009 budget-update, hundreds of cuts are dribbling out as those who are hurt make the cuts public. You will find budget documents that contain misleading claims about funding sports and the arts, even though they are suffering cuts of $15 million relative to two years ago. You will also find a January 20th government news release about an MLA pay freeze.

Premier Campbell said: "In recognition of the progress made to date with public-sector agreements already announced that provide for no wage increases for the next two years, the Province has decided to suspend the cost-of-living compensation increase for all government MLAs for the next two budget years."

The legislation that provides for the annual indexing of MLA pay is Section 2 of the Members' Remuneration and Pensions Act. That section says: "The basic compensation referred to in subsection (1) must be adjusted every year on April 1, commencing April 1, 2008, by the percentage increase of the consumer price index, if any, for the 12-month period ending on December 31 of the previous year." So the Campbell government waived the indexing for two years, but on April 1, 2012 it's back to usual with the MLA automatically getting an increase equal to inflation in 2011. How many of you are guaranteed that automatic increase?

Base pay is only part of the story; recall that the Campbell government has now "indexed" increases in MSP "premiums" to 6% per year. Like most British Columbians, you may be paying more for MSP premiums, but MLAs and many public sector employees have their premiums paid by their employer. MLAs won't lose one cent because of the premium hikes, nor will many other public sector workers, but school boards are not compensated by the province for the cost downloaded onto them by tax shifts like this. MLAs are protected while school boards have to lay off teachers and increase class sizes in order to make-up for costs imposed by the province. To put it in perspective, $6 per month for every teacher in the province, means about $2.4 million in additional costs to school boards, equal to the loss of more than 35 full-time equivalent teachers just to cover the Campbell government's hike in MSP premiums.

Members of Campbell's caucus are not feeling the pain. They are guaranteed full indexing of their incomes and pensions effective April 1, 2012. Before then they are protected against cost hikes to their many benefits - none of which are itemized on the website which only discloses "basic" compensation of MLAs, and doesn't disclose any of the hidden perks.

The Campbell government, his caucus and the Opposition should make a tough decision to roll back their pay to 2007 levels, before the 27% increase. Doing so would save over $2.3 million per year, more than enough to restore funding to many services.

The Campbell government isn't making tough decisions; it is making thousands of British Columbians suffer unnecessarily.