Golden parachute: MLAs now qualify for extra severance pay

Last Friday, the severance pay most Yukon MLAs will receive if they’re not re-elected abruptly doubled.

Last Friday, the severance pay most Yukon MLAs will receive if they’re not re-elected abruptly doubled.

All first-term MLAs are now entitled to $37,895 in severance, up from $18,947. Cabinet ministers are eligible for $58,300, up from $29,150. The premier is entitled to $67,045, up from $33,523.

The hike is the result of a clause in Yukon’s Legislative Assembly Act, which states that MLAs who’ve served five years or fewer are entitled to 25 per cent of their annual earnings in severance. Those who’ve served between five and eight years are entitled to 50 per cent. After eight years, they receive a full year’s worth of income when they leave the house.

Yukon’s last election was held on Oct. 11, 2011. When Premier Darrell Pasloski chose not to drop the writ last Friday, he ensured that the next election will not take place until after Oct. 11, 2016. That means all first-term MLAs will have served just over five years by the time voters go to the polls, and their severance pay will be double what it would have been had the election been held even a few days earlier.

All MLAs receive severance pay, regardless of their reasons for leaving the legislative assembly. That includes Community Services Minister Currie Dixon, who is not running for re-election. It also includes Independent MLA David Laxton, who left the Yukon Party over an allegation of sexual harassment in May and who has not decided whether to run again.

MLAs cannot opt out of receiving severance, said Helen Fitzsimmons, a director with the legislative assembly office. She said the money is meant “to compensate for the time it’s going to take (them) to find another job.”

“It’s hard for them to find a job, especially in a small town,” she added.

Deputy premier Elaine Taylor, deputy Speaker Darius Elias and Justice Minister Brad Cathers are the only MLAs who were elected both in 2006 and 2011. They will receive a full year’s earnings if they aren’t re-elected.

This severance formula was set out in 2007, after a review of MLA pay. Fitzsimmons said MLAs used to receive 25 per cent of annual income as severance, regardless of their number of years in office.

But Liberal Leader Sandy Silver said he would change the legislation again if the Liberals form the next government. His own severance has increased to $46,640 from $23,320.

“It’s just short of a loophole, really, to have such a drastic increase after five years,” he said. He suggested a new formula that would see severance increase by some smaller percentage for each year of service.

In fact, several other jurisdictions have that kind of system, including Nunavut, Nova Scotia, Prince Edward Island and Manitoba.

Ontario has a formula similar to the Yukon’s. But Alberta actually abolished severance to MLAs in 2012, though it simultaneously increased their income.

Fitzsimmons said Yukon’s MLAs are among the lowest-paid in the country, with a basic salary of $75,790. Only P.E.I.’s representatives make less, according to an April, 2016 survey by the Alberta legislative assembly. At the other end of the spectrum, Alberta’s make $127,296.

But Jordan Bateman, with the Canadian Taxpayers Federation, said a formula like the Yukon’s is “pretty ripe for abuse,” especially when the government has “unfettered control” over when to call an election.

“Why would anyone ever call an election before five years?” he said.

Yukon’s mandates were extended to a maximum of five years in 2002. The 2011 election was held five years and one day after the 2006 election, meaning any first-term MLAs who were not re-elected in 2011 also received double the severance they would have the day before.

In response to questions from the News about the timing of this election, the premier’s office provided a brief response: “Severance was not taken into account in election planning.”

Allan Tupper, head of the University of British Columbia’s political science department, said the income of elected officials is increasingly controversial, particularly because politicians make the laws that govern their own salaries.

“People say ‘I don’t determine my terms and conditions of employment … but here it’s unilaterally developed.’”

But he said there is no perfect model for doling out severance, and every system is prone to certain “aberrations.”

And he believes it’s fair for politicians to receive severance, as they often leave other careers to serve the public.

“In one sense, it’s rooted in respect for people who do public work,” he said. “I think politicians and public officials generally should be well-paid.”

Contact Maura Forrest at

maura.forrest@yukon-news.com

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