Changes to MLAs retirement funds approved last week are a step in the wrong direction.
The member services committee, which is dominated by Progressive Conservative MLAs, approved a $17,420 payment for retirement investments per year.
They are also able to increase their government matched RRSP contributions by $4,891.
Alberta’s Tory government started out in the right direction this spring by setting a basic $134,000 salary for MLAs, doing away with committee pay, a one-third tax free portion to their salaries, and eliminating the controversial transitional allowance.
The allowance paid MLAs one month salary for every four months in office. Payouts ranged widely, with some receiving hundreds of thousands of dollars. This spring a long-time MLA received more than $1 million when he retired.
The new salary structure created one number Albertans and even MLAs could easily understand, getting rid of a jumble of figures varying widely for each MLA.
However, the latest move to adjust the RRSP contributions comes with more bad than good.
Allowing MLAs to increase their matched retirement contributions by almost $5,000 isn’t as bad because it is optional and they have to match it. However, handing them $17,420 in taxpayer dollars is poor optics and poor public relations.
The RRSP matching contributions is a system you see in the private sector and should apply for government officials as well. MLAs deserve an opportunity to contribute to a retirement plan, however, by paying out $17,420 essentially replaces the transition allowance axed by Redford.
Under the new system MLAs serving 10 years could walk away with $174,000 plus their RRSP contributions.
Its certainly less than what most MLAs received under transitional allowances, but still does not sit well and should be eliminated.
