Nunavut report recommends changes to MLA's benefits, pensions
'It is no secret that some [MLAs] have a difficult time transitioning into the private sector,' report says
Some of Nunavut's politicians are not prepared for life after politics, and now an independent commission is recommending changes to MLA's pensions to fix it.
The revelation is part of a 42-page report, released Friday by Nunavut's Legislative Assembly, on an independent review of MLA's salaries, allowances, expenses and benefits. It was commissioned by the Legislative Assembly in September 2018.
The commission was chaired by former Nunavut Justice Earl Johnson, former Nunavut finance minister Keith Peterson, former Nunavut Member of Parliament Nancy-Karatak-Lindell, and Canada's former assistant auditor general, Ronnie Campbell, who was responsible for audits of the Nunavut Government.
The report makes 14 recommendations, including removing the option for retired MLAs to have their pensions paid out at an accelerated rate — known as a fixed-term allowance (FTA).
It is no secret that some [ MLAs ] have a difficult time transitioning into the private sector.- Commission's report
"It is no secret that some [MLAs] have a difficult time transitioning into the private sector," the report reads.
"Some may view the FTA as bridge income until they can secure their next employment, even if it means less income in retirement."
When a Nunavut politician retires, they can either have their pension paid out over their lifetime, or as an FTA paid out over five, 10 or 15 years. Pensions can start being paid out the day an MLA leaves politics, or be deferred to a later date.
Taking a pension out as an FTA can give the earner more flexibility in how they receive their income — like investing it for later, for instance. But though the FTA is supposed to be used for retirement income, the report warns the FTA option opens the door for the money to be used for any purpose.
"This can lead to little or no retirement income from the plans when [MLAs] are older, which could lead to lower standards of living, poverty, and reliance on government programs for income."
While the commission expects a negative response from MLAs by removing their freedom of choice with the FTA, it says the public interest in managing taxpayer dollars outweighs the MLAs potential grief.
"The commission believes that the public will respond positively to the decision by encouraging the members to be responsible with their tax-funded pension monies."
More transparency and accountability
The report also addresses a November 2018 CBC News story that revealed two Nunavut cabinet ministers billed more than $24,000 in ministerial home travel expenses to other communities, even though they lived in Iqaluit.
The policy was ambiguously written and its interpretation under former premier Paul Quassa allowed the two ministers to claim the perk. Premier Joe Savikataaq, however, had a different interpretation, and stopped the practice.
The commission recommends changing the administration of ministerial benefits to ensure more transparency in reviewing those perks.
The news media and public should be satisfied that the process is transparent and that all Members are being held accountable for their travel and benefits.
It recommended that the ministerial home travel policy no longer be at the discretion of the premier's office. It also recommended the same for the ministerial remuneration and benefits policy, the housing policy, and the reimbursement for costs of temporary accommodation in Iqaluit policy.
Instead, it recommends the interpretation of those policies be handled by Nunavut's management services board — a branch of the Legislative Assembly comprised of the Speaker, at least one minister, and three other MLAs; although the commission also recommends shaking it up to two ministers, two MLAs, and the Speaker.
"Since the review is conducted in public, the news media and public should be satisfied that the process is transparent and that all Members are being held accountable for their travel and benefits," the report read.
It will now be up to Nunavut's MLAs to decide whether to accept any of the report's recommendations.
Nunavut's spring Legislature sitting begins on May 28.