Mr. Speaker, it gives me great pleasure to speak on the motion before us. This is an important issue that, as has been pointed out, was dealt with in the red book. This appears to be a controversial issue. Much has been written in the papers and shown on television. The issue raises a question: Are the current pension provisions for members of Parliament appropriate?
The motion proposes to replace the existing pension plan with a pension plan that reflects the commitments made in the red book. It is an issue this government wants resolved. This government plans to keep its promises. The Prime Minister has given a clear indication that we will deal with this issue. The details still have to be worked out.
Today I want to place the issue in context. One of the measures by which we can judge whether the current provisions are appropriate is to look at what other governments are doing around the world. In its report on parliamentarians' compensation, Sobeco, Ernst and Young compared our overall compensation with that of parliamentarians in other countries. These countries were Australia, the United Kingdom, Belgium, Sweden, France and the United States.
As members recall, Sobeco based its studies on our indemnities, allowances, services and benefits as well as those of senators. The firm looked at compensation practices and policies, trying to determine similarities and differences in approach from other countries. Then it estimated the value of total compensation for parliamentarians in each nation. While the roles of parliamentarians differ somewhat in the various countries studied, that does not take away from the validity of the comparisons in the consulting study.
Looking first at total compensation the consultants included base salary, the annual value of the pension plan and private insurance. The results show that Canadian MPs rank in the mid-range of the seven countries studied. The best paid by far are American members who receive more than double what Canadian, Australian and French parliamentarians get.
Australia, Canada and France are closely bunched together and they are significantly ahead of the United Kingdom, Belgium and Sweden. Taking sessional indemnity, our basic salary, we are in much the same position internationally. American legislators are way ahead of us. Their salaries are estimated at over $169,000, while ours are $64,400. The Australians and the French get slightly more and the rest lag a bit behind.
In terms of pensions alone, we rank somewhat behind both Belgium and Australia and ahead of the remaining countries examined. The pension rules vary from country to country. Parliamentarians are entitled to a pension as soon as they are elected in Belgium, France and Britain, while they must serve at least five years in the United States, six years in Canada and Sweden and eight years in Australia. In other countries the pensionable age ranges from a low of 12 years service in Sweden and Australia.
In Britain pensions can be paid to former MPs at 60 if their age and years of service add up to at least 80. Some countries provide reduced pensions to former members if they are retired before the normal pensionable age. The amount of retirement pension required for each year of service is lower than the Canadian rate in Belgium, France, Britain and the United States. It is higher or comparable in Australia and Sweden.
There is quite a wide range in contribution rates as well. Members do not have to contribute at all in Sweden, while the rates are 7.5 per cent of salary in Belgium, 11.5 per cent in Australia, and 1.3 per cent in the United States.
It is difficult to compare group insurance plans in the various countries because of the different social programs in place. Group insurance is paid entirely by the government in all of the countries studied except the United States where the members pay about 50 per cent of their group insurance programs.
Australia and Belgium provide severance allowances to their parliamentarians. In Belgium it is equal to about one month of salary for each year of service and in Australia it ranges from three months salary after one year of service to 26 months after eight years of service.
It is interesting to look at the various allowances available to parliamentarians in Canada and other countries. With expense allowances there is a wide range of practices. France and Belgium have non-taxable and non-accountable expense allowances. In Australia and Sweden this allowance is taxable but work related tax deductions are permitted.
As for travel expenses, Australia, Belgium and Sweden pay for all work related travel by their legislators. In France only the costs of travel between the constituency and Paris are paid.
Most countries have some sort of severance allowance and resettlement provisions to help parliamentarians make the transition to private life. Interestingly, the personal financial situation faced by parliamentarians as they return to private life in France and Sweden has an impact on amounts they are entitled to receive.
From this overall comparison we are neither the best paid parliamentarians at the international level nor the worst. While our pensions may be better than those of parliamentarians in some countries, they are not quite as good as they are in others. In overall comparison we lag well behind our American cousins.
As I said earlier, the Prime Minister has made clear the government's commitment to introduce legislation to change the pension plan. Our party is committed to ending double dipping. I applaud pension reform. I do think it is important for everyone to realize that in terms of overall compensation, Canadian members of Parliament are no better paid than colleagues in most other major western countries and we lag behind a number of countries.
