House of Commons Hansard #215 of the 35th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was pension.

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The House resumed from June 8 consideration of Bill C-85, an act to amend the Members of Parliament Retiring Allowances Act and to provide for the continuation of a certain provision, as reported (without amendment) from the committee; and on Motions Nos. 1 to 7.

Members Of Parliament Retiring Allowances Act
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10 a.m.

Reform

Stephen Harper Calgary West, AB

Mr. Speaker, I rise today to debate Bill C-85, the Members of Parliament Retiring Allowances Act, and the amendments the government proposes. I am doing it in the short time that remains, given the closure and time allocation tactics of the government.

The amendments to the bill submitted under my name and under the name of the member for Calgary Centre have four main functions. First, to bring the members of Parliament pension plan into line with the private sector, both for MPs and Senators. Second, to allow MPs in this and in all future Parliaments to fully opt out of the pension plan. Third, to impose a Canadian citizenship requirement on all plan members. Fourth, to subject members pensions to the same clawback provisions that exist to old age security, something the Liberal government had opposed when it was in opposition but now seems to believe is fully acceptable for ordinary Canadians.

We are debating the first set of motions. Motion No. 4 provides that if a province separated, members of Parliament from that province would not automatically draw a pension from the Canadian government. This is the effect of proposing a citizenship requirement. We will be very interested to see whether it is the intention of the government to guarantee pensions to members who eventually may not be citizens of the country.

I have heard some comments from members of the separatist party in the House that they do not care what is happening in the House because they will not be here in the fall anyway. I happen to think they are wrong and they may be here much longer. In any case this raises an interesting question.

It is because the members of the Bloc Quebecois are insisting that Quebec is going to separate in the coming year, I suppose.

Members Of Parliament Retiring Allowances Act
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10 a.m.

Some hon. members

Hear, hear.

Members Of Parliament Retiring Allowances Act
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10 a.m.

Reform

Stephen Harper Calgary West, AB

This amendment in fact reveals the strength of their convictions on this objective.

Bloc members' intention to guarantee their own Canadian pension or participate in this retirement pension plan indicates a lack of confidence in the possibility of separation. I suppose there is an element of sacrifice in the sovereignty project. Interestingly enough, the Bloc Quebecois is proposing putting Quebecers in a position to lose the benefits of Confederation, including pension benefits, but is pushing here for the adoption of the Parliament's pension plan.

I would suggest that one way to show their good faith in the matter would be to vote for this amendment and to support the idea that things like pensions need to be negotiated, if, by chance, Quebec should really separate after the referendum.

It will be interesting. I doubt the Bloc will be prepared to take such a daring step in the House of Commons.

The effect of Motions Nos. 1 and 6 are to change the opting out provisions so members of future Parliaments can make a one time decision to opt in or out of the plan during the first 60 days the House sits after they are elected. Reform MPs will save taxpayers over $38 million by opting out and clearly in the absence of substantive changes to the plan future parliamentarians must have this option as well.

We will keep in mind that the failures of the government are starting to add up. While it may reject some of the populist measures used by my party I expect the next federal election to

be very much a referendum on issues like MP pensions. I do not believe by any means this issue will go away even if government members defeat this amendment.

We will see as in the Ontario election this is a hot issue and will still be a hot issue in the next federal election. Voters will ask for members to cut their pensions without any increase in pay, a suggestion which I think is perfectly reasonable.

Motions Nos. 2 and 3 change the bill so that a member who dies before the expiry of the 60-day decision period is assumed not to have opted in. Bill C-85 automatically opts these people in. I guess Reformers would rather assume the best of people than the worst of people.

It seems strange the government would make the default option here an assumption of action of opting in. I understand a lot of pressure is being placed on backbench Liberals to opt into this plan so the driving forces of the plan, the Prime Minister and the Deputy Prime Minister, do not look too bad. Forcing dead MPs to opt into the pension plan is taking the idea of party discipline to new heights or to new depths even for the Liberal Party.

We know who will bear the brunt of the public backlash of this in the next election. It will be the Liberal backbenchers who did not really support the plan, who were told to participate and who if they lose the election will lose all pension in any case. This is really a remarkable coincidence of both lack of intelligence and lack of integrity coming together on an issue.

Motions Nos. 5 and 7 change the bill to allow all members to opt out completely. Under Bill C-85 MPs who as of October 1993 already had six years of service could only opt out of benefits earned after the last federal election, thus creating the terms trough regular and trough light which we like to refer to, the two tier system.

We have talked already about how this inability for longer serving MPs to completely opt out of Bill C-85 creates the two tier system. However, this is a minor issue in my opinion. The real issue is the two tier system between MP pensions and what is available to other Canadians.

One of the witnesses who testified before the committee which studied this bill, and I use the term studied very loosely, Mr. Brian Corbishley of Edmonton, testified the pension proposed under Bill C-85 is about seven times more generous than a typical public sector plan and four times more generous than a typical private sector plan. Mr. Corbishley's testimony and others should be listened to much more carefully and much more seriously than some of the government members seem to take this issue.

In Alberta Mr. Corbishley's firm, Peat Marwick, proposed a pension scheme for MLAs much less generous than that which existed in Alberta at the time. The plan in Alberta at the time was almost identical to what the government is now proposing.

In the heat of the pre-election build up in Alberta the government refused to significantly alter that plan to deal with the objections of taxpayers and citizens and it was increasingly looking like that government would face defeat in the election. Ultimately Mr. Klein ended up abolishing the plan, a major factor in his winning the election and doing some of the good things in Alberta he is now trying to do.

What is interesting about this, and I urge Liberal members to consider it very carefully, is ultimately a half hearted attempt to reform the MLA pension plan in Alberta resulted in MLAs in Alberta having no pension plan whatsoever, a situation which I do not think is ideal but which will result if the government follows the course it is on.

I urge members once again to consider some of these amendments. They will significantly alter the bill to make it more acceptable to the public. Ultimately the public will find this bill unacceptable. We know the MP pension plan will die because of the unreasonable form it is in today. It will die in any form and there will be no increase in compensation that the members on the other side so earnestly desire and do not deserve.

In any case, I ask them to consider these amendments and I thank them for their patience.

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10:15 a.m.

Kingston and the Islands
Ontario

Liberal

Peter Milliken Parliamentary Secretary to Leader of the Government in the House of Commons

Mr. Speaker, I want to make a few points with respect to the amendments put forward by the hon. member for Calgary West because they deserve some comment.

They are clearly amendments-

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10:15 a.m.

An hon. member

You already gave your comments.

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10:15 a.m.

Liberal

Peter Milliken Kingston and the Islands, ON

No, I have not spoken on the bill. This is the first time I have spoken to the bill at this stage in the House. The hon. member should be pleased that he is getting a balanced approach to the bill instead of the twisted rhetoric that the Reform Party is engaging in.

I want to point out a couple of things that are important to the Canadian public in viewing the bill. We are hearing a great deal from members of the Reform Party about wanting to abolish the pension altogether. They say that if we get rid of these pensions then everything would come up roses and we would solve the problem.

I want to point out first of all that some members of the House were elected at a time when there was not significant discussion in the House or in the country about abolition of these pensions.

I draw the hon. member's attention to the 1988 election. He was a Tory then and was working for a Tory member of Parliament who was seeking re-election and who was going to earn a pension. He may have already qualified for all I know. I do not know who he was working for in those days but he was very supportive of the whole thing. There was no public debate about pensions in 1988.

Many members who were elected at that time in good faith left their employment, took a reduction in the earnings they had on the basis of a certain salary that was stated to be the salary for members of Parliament plus the possibility of earning a pension at the conclusion of their term of service in the House of Commons.

The pension was generous. It is generous and remains generous. That is true. However the members of Parliament who entered the lists, as it were, for the election in 1988 and in all previous elections did so on the basis that at the end of their term of office they would be compensated in some way that was generous but was designed to make up for the loss of income they suffered in being elected to Parliament in the first place.

The hon. member is now saying that those people had expectations that were out of line, that they do not qualify to receive the pension to which they are entitled under the law. These people in the Reform Party want to change the law to prevent those persons from receiving those pensions.

I can understand their approach when only one of them has qualified for a pension, when only one of them was a successful candidate in 1988. In fact she lost in 1988 and then got elected in a subsequent byelection. There was not a single one of them in 1988 and they were not talking pensions big time during that election. It was a non-issue.

It was a non-issue for me in 1993. Nevertheless, the members of the Reform Party insist that members who were elected before are somehow pigs at the trough because they were elected under a system of remuneration which they are now accepting.

Most people enter a career looking at the remuneration package and seeing what it is like. When they are successful in either choosing the job or in this case getting elected to the job, they are then told by Reformers who come along later, Johnny come latelys if ever there were any, that somehow they are pigs at the trough because the remuneration package that they accepted when they started the employment is unacceptable to the new group.

First of all, that is a stupid argument. It is wrong. The members of the House who were duly elected on the basis of a package are entitled to receive the package they obtained.

What has the government done? It made two promises in 1993 to change that package. One was to prohibit double dipping and the second one was to put a minimum age in place so that members would not draw a pension at an unduly young age.

The bill fully complies with those promises. The age change is there and the double dipping prohibition is there. The government went beyond that and reduced the rate at which the pension accrues which means members of Parliament who are elected on a certain remuneration package will in fact get less. That is a very significant change which is totally unappreciated by the members of the Reform Party for one good reason. They are all going to opt out.

I suggest the electorate will opt them out of the pension scheme. They will not qualify anyway. The only one that has qualified is the member for Beaver River. I suggest none of the others would qualify anyway.

The member for Beaver River has been on a rant on this issue for one good reason. She has been cheated out of her pension by her colleagues who have muzzled her, beaten her into the ground and forced her to opt out of the pension scheme so she can join their ranks. They will be taken away by the electorate anyway in the next election. They will not qualify but they have muzzled her into opting out so she is in a fit of rage.

She is the one, with her leader who asked for the opting out clause and now wants it taken out of this bill. She wants it removed from this bill because she wants her pension. She is having a fit because she cannot get her pension. I hear she is taking wrestling lessons in Calgary this weekend because she needs to be able to deal with her caucus colleagues. She is being wrestled to the ground.

I want to turn to one other aspect. We keep hearing we should cut the pension more. We have not gone far enough. However, we do not hear from the Reform Party that we should change the double dipping scheme more by preventing double dipping not just by people who take federal appointments but by those who are receiving another pension from another source. Why is that? Because there are at least three members on the other side who are earning substantial pensions from the Government of Canada.

Members Of Parliament Retiring Allowances Act
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10:20 a.m.

Reform

Lee Morrison Swift Current—Maple Creek—Assiniboia, SK

Federal?

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10:20 a.m.

Liberal

Peter Milliken Kingston and the Islands, ON

Yes, three of them are federal. They are getting big, fat military pensions and maybe others. They are pocketing that money while they sit in the House earning a salary. They do not talk about extending double dipping because their colleagues will feel it in the pocketbook. They should have more sympathy for the hon. member for Beaver River and let her express her own opinions without wrestling her into the ground on this issue.

Look at the other pensions they are getting. When hon. members opposite stand up and say they are not taking their pensions, why do they not also stand up and say: "The reason I am not taking my MPs' pension is because I am already getting a pension from another source". Why do they not come clean and tell us about that? I do not have a pension from another source, but some of the hon. members opposite I know do have one.

Why do those members not stand up and say: "I'm getting a pension from another source, so I don't need an MPs' pension. I'm happy to opt out". I know why. They would be embarrassed if they were caught double dipping later. It is amazing the members that are double dipping now are not confessing to it. We do not hear any talk about that. Why does the hon. member for Calgary West, in his white knight charger set of amendments, not propose the kind of amendments that will cut out the double dippers in his own party? Why will he not do that? I know why he will not. Because his leader told him not to.

His leader knows all about pensions and the way to collect pensions. His father was in the Senate which is a pension haven. Everybody knows that. His leader's father was a senator for years.

It is quite unbelievable that members of the Reform Party who speak on one side saying that we have to cut the pension will not speak on the other and say that we should cut double dipping more. Why will they not? They know all about double dipping. They are pros at double dipping. They know how to get big, fat pensions from other sources. I will not mention names but hon. members opposite know who I mean when I say there are people sitting there who are getting fat cat pensions of $40,000, $50,000, $60,000 a year and they are earning their salary here as MPs at the same time.

In many cases those pensions are paid out of public funds. They may not be paid in every case by the federal government but they are paid out of taxpayers' funds.

We do not hear a word about it either from the Reform Party or from their friend David Somerville and the National Citizens' Coalition who is a mouthpiece for the Reform Party on this issue. The two of them have been in bed together for years.

The hon. member for Calgary West and the National Citizens' Coalition conspired together to defeat the former Tory member because of his views on the pension and on electoral reform. He knows that. He knows they have been working together to do this. The Reform Party members in the House and their performance in calling other members names, calling other members who have earned their pensions in good faith pigs, are absolutely disgracing this House. They should be ashamed of their conduct. The hon. member for Beaver River after her performance yesterday, threatening to beat up members of the House, should also be ashamed of her performance also.

Members Of Parliament Retiring Allowances Act
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10:25 a.m.

Reform

Chuck Strahl Fraser Valley East, BC

Mr. Speaker, I rise on a point of order. In reference to the member's remarks during his intervention, where he accused a member of beating someone up, if he is accusing her of doing that in the House I wonder if he could retract that statement. It is absolute nonsense and he knows it.

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10:25 a.m.

The Acting Speaker (Mr. Kilger)

Order, please. I have had the benefit of being in the chair for the better part, if not the entire portion, of this debate. I am well seized of the fact that it has been a very vigorous debate. I would say respectfully to the hon. member for Fraser Valley East that his point of order is a matter of debate. It is not a point of order according to our standing orders, our own rules in this House.

I would urge members on both sides participating in this debate to be judicious and to continue to be respectful of one another, and certainly of the collectivity of this institution, the House of Commons.

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10:25 a.m.

Reform

Jack Frazer Saanich—Gulf Islands, BC

Mr. Speaker, like my colleagues I rise to speak on Bill C-85 with a heavy heart and a sense of despondency.

Yesterday we were again reminded that there is no respect for the democratic process on the government benches. Once again they have not once, not twice, but three times invoked time allocation, thus stifling honest parliamentary debate on matters of great importance to Canadians.

It is perhaps appropriate that I speak after the parliamentary secretary to the government House leader because I am one of the people who he referred to as drawing a pension from the military. I have no trouble admitting that. I served for over 36 years in the military. I paid into a pension fund 7.5 per cent of my pay for 35 of those years, which was the maximum that I could qualify for. The fund from which I draw my pension is now $30 billion and growing as people continue to contribute to it. Therefore, the idea that the taxpayer is paying my pension is absolutely ludicrous.

I have no regrets about it. Double dipping has been adequately defined as the retirement of a member of Parliament who has been appointed to a government job and continues to draw his pension and his salary at the same time.

I earned my place here. The people who elected me knew that I was drawing a military pension and they knew that I would be keeping that pension once I was elected. I feel there is no problem, but I have some doubts about the honesty and impartiality of the parliamentary secretary in this instance.

The Reform Party is placing before the House 35 amendments to Bill C-85. First, if implemented, these amendments would bring the MPs pension scheme into line with the private sector for both MPs and senators, and failing that, second, the amendments would change the opting out provisions so that newly

elected members would have a choice to opt out of the plan to allow all MPs to withdraw from participation in the plan. Third, Motion No. 4 would ensure that all members of the plan are Canadian citizens. Fourth, Motion No. 34 is based on the private member's bill of the hon. member for Yellowhead, which would make provisions to recover former senators and MPs pensions on the same basis as other income received by a former member, if that former member was in that year entitled to receive old age security.

These 35 motions are important for Parliament and for the Canadian taxpayer. Unhappily, it appears that presentation of these motions is a futile parliamentary exercise as it becomes increasingly evident that the government has made up its mind and will move ahead with the legislation as it stands.

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10:30 a.m.

Liberal

Roger Simmons Burin—St. George's, NL

Mr. Speaker, I rise on a point of order. I have been listening with interest to my friend from Saanich-Gulf Islands. I believe him to be a man of integrity. I do not think he meant to say it but he did say it quite directly. He questioned the honesty of the member for Kingston and the Islands.

Under the rules, you will be aware, Mr. Speaker, it is not permitted to cast aspersions on the integrity of an individual. I would ask that you ask him to withdraw that aspersion.

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10:30 a.m.

The Acting Speaker (Mr. Kilger)

In listening to the member's intervention I suppose what I should do and will do is review the blues for verification of the wording and possibly the spirit of what was said.

I take the member's point of order with great seriousness and, if necessary, I will report back to the House.

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10:30 a.m.

Reform

Jack Frazer Saanich—Gulf Islands, BC

Mr. Speaker, I have no hesitation to withdraw the comments the member for Burin-St. George's referred to. They were uttered inadvertently. I did not intend to cast aspersions on the parliamentary secretary's integrity or his honesty.

The House has heard many arguments as to why the proposed revisions to the MP pension plan are still too generous. Committee members have received repeated testimony from highly qualified witnesses who confirm that the plan is still far too rich and is basically poor public policy.

Let me quote Paul McCrossan, a former member of Parliament and now an actuary for Eckler Partners Ltd., who appeared before the Standing Committee on Procedure and House Affairs. He said:

My conclusion is that the bill is bad for you as members, bad for Parliament as an institution and bad for Canada because, having acted on this bill, you will hamstring this Parliament in dealing effectively with the most urgent challenges it faces, namely redesigning Canada's national retirement income and medical care systems to reflect the financial realities of Canada as well as Canada's rapidly aging population.

This is exactly what is now happening. Parliament is hamstrung from dealing with important issues of the day: our increasing deficit and debt, social program reform and building a stronger economy which will produce more jobs for Canadians, to name just a few key problems.

Despite the apparent futility of our efforts, Reform members cannot, with good conscience, allow the legislation to slip by without resistance. Perhaps those large pink pigs placed on the front lawn of Parliament to protest this pension scheme last week say it best. Surely there is no other place in this great nation where people are authorized to legislate the amount of their own benefits and salaries.

I would agree with those who contend that the basic pay of members of Parliament is insufficient when the responsibility and workload are considered. However, this pension benefit cannot be justified and continues to leave a foul taste in the mouths of all taxpayers.

Is our government blind to what is right? Why, rather than paying lip service, has it not undertaken realistic pension reform? Certainly there have been enough good suggestions given both in the House and in representations to the Standing Committee on Procedure and House Affairs.

The Reform member for Beaver River will refuse her million dollar payout and, under the deliberately planned punitive opting out provisions, will lose any government contributions made to that plan.

Members will know that normal pension plans see the employer matching employee contributions. Even with the revisions to the pension plan instituted by the government, the taxpayer will be contributing an excessive $3.60 for every dollar members of Parliament contribute.

The government made the opting out provision punitive because it very much wanted the member for Beaver River to opt into the plan so that during the next election it could point the finger at members of Reform Party and say that we were no different from the others.

But we are different. We fought for these very principles during the last election. The parliamentary secretary's reference to the fact that it is Reformers who are bringing these measures to Parliament is absolutely wrong. Yes, we are transmitting it, but we are bringing the message from all Canadian taxpayers.

Unhappily, despite the wishes of the parliamentary secretary, it would appear that the same issue will be around again in the next election.

I return to Paul McCrossan's testimony before the committee about the legislation. Referring to the legislation he said:

It does nothing to develop a sensible compensation package for members and may actually impede redesign. It entrenches your benefits at a level higher than those available to general taxpayers. At the same time it reduces the cost of your compensation package.

So when you come to redo a compensation package, you will be left with having then to increase it from the level you have reduced it to and it is going to make it much more difficult to do it in two steps rather than one.

It reduces compensation for future service but leaves benefits substantially above the private sector and, indeed, public sector permissible levels.

It is just this that members from this side of the House have been saying. The benefits go well beyond anything in the public realm.

Some time in the future MPs will again decide that the compensation package is not adequate and adjustments will be made.

Many take great pride in pointing out that MPs have curtailed their salaries in seven of the fourteen years since the present pension scheme was adopted in 1981. Are the salaries kept low in exchange for generous benefits? That question has been raised many times in the House and in committee.

The study by Sabeco, Ernst and Young called for a 37 per cent increase in MP salaries, accompanied by a reduction in pension benefits, also recommending that they should be limited to retirees who are at least 60 years of age.

The report further suggests that when the parliamentary wage freeze is lifted in 1996 the MP basic annual salary be increased to $75,000, and that prior to the next election Parliament be urged to pass legislation to increase MPs' salaries to $86,000 to take effect on the first day of the 36th Parliament.

Given the political climate, the ever present debt and deficit and this ineffective pseudo pension reform, I do not believe the government has the political will to make these badly needed appropriate changes to current MP compensation and pension arrangements.

Once again let me go back to Paul McCrossan who said:

I believe that legislating preferred treatment for yourselves, even if it is reduced preferred treatment, as proposed under this bill-will continue to foster cynicism.

Each of us holds a very privileged position and thus must make every effort to avoid abuse of that position.

As long as Parliament holds the power to set members own salaries, perks and pensions, the job will clearly not be effectively achieved. Politics will come into play as they have in this instance and longstanding MPs will resist every effort to make appropriate changes to the pension plan.

Even in the Progressive Conservative government Wilson budget of 1986 provisions were made to lower MP pensions to private sector levels. We could wonder why this had not happened but the answer is clear. Decisions such as this cannot be left in the hands of Parliament. Rather, a competent, independent body must be assigned to ensure appropriate compensation and pension reforms are implemented.

It is not too late even at this report stage to make some important changes. The proposed reductions make only a small dent in the cost to the taxpayer. Treasury Board officials have indicated that most of the savings will result from actuarial factors rather than legislated changes.

For my own part, unless the government makes real changes which bring the MP pension scheme into line with that of other Canadians, I will be signifying my intention not to opt into the proposed plan.

I call on government to go back to the drawing board, heed the very clear direction given by its own constituents and make meaningful, realistic changes to Bill C-85. I call on rank and file members of the government to press for these changes. They know what is right and proper. They know that Bill C-85 does not meet this need, and they should know that a concerted effort on their part could influence the changes needed to fulfil at least one of the promises made in the red book.