Pension reforms which kick in on January 1, 2016 will see MPs and Senators finally paying more towards their own pensions
The Canadian Taxpayers Federation (CTF) released its calculations of estimated pension and severance payments paid to the 180 MPs who were either defeated or did not seek re-election in the October 19 general election. Defeated and retiring MPs will collect $5.3 million in annual pension payments, reaching a cumulative total of $209 million by age 90. In addition, another $12.8 million in severance cheques will be issued to former MPs.
“Losing an election can be tough, but most MPs will have a soft financial landing,” said CTF Federal Director Aaron Wudrick. “The good news is that thanks to the hard-fought pension reforms that take effect on January 1, 2016, taxpayers will not have to shoulder as much of the burden in the future.”
For MPs who retired or were defeated on Monday, taxpayers contributed $17 for every $1 put into the plan by an MP towards their pension. After January 1, 2016, the ratio will gradually shift to a ratio of $1.60 in taxpayer contributions for every $1 put in by an MP or Senator.
Wudrick noted that eight former MPs will gather more than $100,000-plus a year in pension income including outgoing Conservative cabinet ministers John Duncan ($132,394), Peter MacKay ($117,746) and Bernard Valcourt ($116,987). In terms of lifetime estimated benefits to age 90, 21 MPs are projected to collect more than $3 million, including MacKay ($5.9 million), Liberal Gerry Byrne ($5.2 million) and Conservative Rob Anders ($4.7 million).
“These pension changes are a welcome step towards broader public sector pension reform,” added Wudrick. “We encourage the new government to take the necessary steps to ensure government employee pensions are more in line with what the vast majority of Canadians working in the private sector expect to receive.”
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