Raises approved by Alberta Premier Ed Stelmach and his cabinet will translate into severance packages of more than $1 million for both him and the legislature's longtime Speaker.
The 23-member cabinet voted last Tuesday to boost their pay by about 30 per cent, or $42,000, to $184,000. Stelmach's salary increased by $54,000 to $213,450. The decision was not announced until Thursday.
The changes will also mean increased severance packages for MLAs when they quit the Alberta legislature or are defeated.
In lieu of a pension plan, MLAs earn three months pay for every year they are in office with no limit to how much they can get. Most public- and private-sector jobs pay between two and four weeks salary for each year of employment with a cap on the total.
"The severance packages are certainly gold-plated. They are the most generous severance packages in all of Canada for politicians," said Scott Hennig from the Canadian Taxpayers Federation.
Speaker Ken Kowalski, who was first elected in 1979, would receive $1,345,121 — an increase of $273,681 — if he left elected office in 2012.
Based on the same date, Premier Ed Stelmach would walk away with a severance of $1,110,131, an increase of $252,690.
Stelmach open to reviewing salary process
On Monday, Stelmach insisted that it's critical that salaries for elected officials, particularly cabinet ministers, be high enough to attract people from a wide range of professional fields.
But he added on Thursday that he's open to suggestions on new ways of reviewing politicians' salaries.
'That's like picking between being punched in the face, or kicked in the groin. I mean, which one do you want? They're both bad.' — Scott Hennig, Canadian Taxpayers Federation
"It is easy for some public to get excited about this," the premier said. "But on the other hand, this is a one in 15 year adjustment."
Liberal Leader Kevin Taft, who saw his own severance jump $125,769 to $618,149 if he leaves in 2012, said he hopes the issue will be decided by an independent commission.
He said Thursday that he's donating his $42,000 raise to charity.
"It's not an increase in pay I asked for or expected, and it's not one I personally plan to keep," Taft said.
When asked about the increased payouts, many MLAs pointed out that they do not receive a pension. Former premier Ralph Klein replaced a pension plan in 1993 with the current "transition allowance" structure.
"It would probably cost taxpayers significantly more money overall to pay out a gold-plated pension," conceded Hennig. "But that's like picking between being punched in the face or kicked in the groin. I mean, which one do you want? They're both bad."
The government also covers half of an MLA's annual RRSP contributions up to about $10,000.