Thank you.
Members of the committee, I have the honour of appearing before you today as you begin your consideration of Bill C-17. This important piece of legislation proposes to amend the Judges Act to implement the government's response to the report of the 2003 Judicial Compensation and Benefits Commission.
As committee members are well aware, the establishment of judicial compensation is governed by constitutional principles designed to ensure public confidence in the independence and impartiality of the judiciary. At the federal level, section 100 of the Constitution Act requires that Parliament, and not the executive alone, establish judicial compensation and benefits following full and public consideration and debate.
In addition to the protections of section 100, the Supreme Court of Canada has established a constitutional requirement for an independent, objective, and effective commission that makes non-binding recommendations to government. The government must respond publicly within a reasonable period of time.
As the committee is also well aware, any rejection or modification of a commission recommendation must be publicly justified, based on a standard of rationality. I will say something about this standard in a few moments.
The 2003 Judicial Compensation and Benefits Commission, commonly referred to as the quadrennial commission, delivered its report on May 31, 2004. The former government responded in November 2004 and introduced Bill C-51 in May 2005. However, despite the requirement for the government to act expeditiously, Bill C-51 was never taken beyond introduction and first reading. It died on the order paper in November 2005.
Upon assuming office in February 2006, we made it a priority to review the commission recommendations in light of the constitutional principles and statutory criteria that govern the process. We made this a serious priority precisely because this government is fully committed to the important constitutional principles that govern the establishment of judicial compensation. We recognize that the integrity of this entire process is dependent in part on timely passage of implementing legislation.
The government is firmly of the view that we had a responsibility to take the time to consider the report and recommendations in light of the mandate and priorities upon which we had been elected. However, we did undertake our review as quickly as reasonably possible. This government provided its response to the commission report on May 29 of this year, followed almost immediately by the introduction of Bill C-17 on May 31. The bill was referred after first reading to this committee on June 20.
Mr. Chair and honourable members, I know that you appreciate the critical importance of completing the final stage of the 2003 quadrennial cycle through the passage of legislation. The credibility, indeed the legitimacy, of this constitutional process requires it, especially since the next quadrennial commission process is due to commence in less than one year. I would therefore like to commend and thank the committee for according this bill priority in order to complete this process in a timely way.
Turning to Bill C-17 itself, as you know, the government has accepted virtually all of the commission's recommendations. The key exception relates to the percentage of salary increase. Mr. Chairman, I know that committee members have read the government's response, which fully explains the rationale for the modification of the commission's salary recommendations. I therefore intend to just briefly summarize our thinking on this important issue.
Before doing so, however, I think it's important to speak to the standard of rationality against which any modification of the commission's recommendations by Parliament will be assessed. It is necessary to displace some of the misconceptions that are at play in this area, and in particular suggestions that respect for the constitutional judicial compensation process and for judicial independence, broadly speaking, can only be demonstrated through verbatim implementation of commission recommendations.
To ensure public confidence in the process, I think it is absolutely critical that we have a shared appreciation and understanding of the very balanced guidance that has been provided by the Supreme Court of Canada in the following key cases: the P.E.I. judges' reference case and the Bodner case. In both decisions, the court has quite rightly acknowledged that allocation of public resources belongs to legislatures and to governments. A careful reading of both cases clearly indicates that governments are fully entitled to reject and modify commission recommendations, provided that a public, rational justification is given that demonstrates overall respect for the commission process.
Mr. Chair, I say it here, as we did in the response: the government is confident that we have fully met this requirement. The effectiveness of the commission is not measured by whether all of its recommendations are implemented unchanged; it is measured by whether the commission process, its information gathering and analysis, and its report and recommendations played the central role in informing the ultimate determination of judicial compensation.
The commission's work and analysis have been critical in the government's deliberations. Our response respectfully acknowledges the commission's efforts and explains the government's position in relation to the two modifications to the commission's proposals. Our response also underscores that it will be for this committee to consider the commission report, and ideally, to also hear directly from the commissioners.
I congratulate you for having decided to do that today. It will be for parliamentarians, not the government, to decide which proposal to implement, be it that of the commission, the government, or indeed a third proposal entirely.
In justifying our proposed modification of the salary recommendations, as reflected in Bill C-17, we gave careful consideration to all of the criteria established by the Judges Act, and to two of these in particular: one, the prevailing economic conditions in Canada, including the cost of living and the overall economic and financial position of the federal government; and two, the need to attract outstanding candidates to the judiciary.
With respect to the first of these, we concluded that the commission did not pay sufficient heed to the need to balance judicial compensation proposals within the overall context of economic pressures, fiscal priorities, and competing demands on the public purse. In essence, the government ascribed a different weight than the commission to the importance of this criterion.
In terms of attracting outstanding candidates, we took issue with the weight that the commission placed on certain comparator fact groups against which the adequacy of judicial salaries should be assessed. The government recognizes that the task of establishing appropriate comparators for judges has been a perennial challenge for past commissions as well as parliamentarians, given the unique nature of judicial office. We acknowledge that the commission carefully and thoroughly considered a range of comparative information, including senior public servants, Governor in Council appointments, and private practice lawyers' incomes.
Our key concern was the fact that the commission appeared to accord disproportionate weight to incomes earned by self-employed lawyers, and in particular to those practitioners in Canada's eight largest urban centres. In addition, there was an apparent lack of emphasis given to the value of the judicial annuity.
As the response elaborates, the government believes the commission's salary recommendation of 10.8% overshoots the mark in defining the level of salary increase necessary to ensure outstanding candidates for the judiciary. The government is proposing a modified judicial salary proposal for puisne judges of $232,300, or 7.25%, effective April 1, 2004, with statutory indexing to continue April 1 in each of the following years, with proportionate adjustments for chief justices and justices of the Supreme Court of Canada.
The one other proposed modification relates to the commission's recommendation that the judiciary be entitled to increase the level of reimbursement for costs incurred through the judges' participation before the commission. It recommended increases from 50% to 66% for legal fees and from 50% to 100% for disbursement costs.
As a matter of information, I note that disbursement costs in relation to the commission include not just photocopying and courier services, but in particular the cost of substantial contracts for the retention of expert compensation consultants and related matters. In our view, reimbursement at 100% of disbursement costs would provide little or no financial incentive for the judiciary to incur costs prudently. Accordingly, Bill C-17 would increase the current level of reimbursement for both legal fees and disbursement from the current 50% to 66%.
Mr. Chairman, Bill C-17 also implements a number of other compensation amendments, relating to eligibility for retirement and supernumerary office, and other minor changes to allowances.
Bill C-17 also includes a long overdue proposal aimed at leveling the playing field for partners of judges in the difficult circumstances of relationship breakdown, by facilitating the equitable sharing of the judicial annuity. The judicial annuity is currently the only federal pension that is not subject to such a division, despite the fact that the judicial annuity represents a very significant family asset. The proposed annuity amendments essentially mirror the provisions of the federal Pension Benefits Division Act. Like the Pension Benefits Division Act, these provisions uphold overarching principles of good pension division policy, allowing couples to achieve a clean break, with certainty and portability.
These provisions are also consistent with both the objectives of probative retirement planning and the constitutional requirement of financial security, as part of the guarantees of judicial independence. While on its face it is extremely complicated, the policy objective of this mechanism is very simple: to address a long outstanding equity issue in support of families undergoing the breakdown of the spousal relationship.
Honourable members, I will wrap up here and hand Bill C-17 over to you for your deliberations and decision. I invite you and all parliamentarians to carefully discharge your important responsibilities, in light of the governing constitutional and statutory principles. In doing so, you will help ensure that Canada continues to have a judiciary whose independence, impartiality, commitment, and overall excellence not only inspires the confidence of the Canadian public, but is envied around the world.
Thank you very much, Mr. Chair, for your attention.
I would be pleased to answer any questions that you or committee members may have.
