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May 2012 Report MLA Compensation Review – Alberta May 2012 Report The Honourable J.C. Major, CC, QC REVIEW OF COMPENSATION OF MEMBERS OF THE LEGISLATIVE ASSEMBLY OF ALBERTA | MAY 2012 REPORT Review of Compensation of Members of the Legislative Assembly of Alberta A Report May 2012 Commissioner: The Honourable J.C. Major, CC, QC “MLAs must realize that their primary purpose is to maintain the integrity of democracy and that all of their actions should focus on that goal. Serving their constituents is noble, but does not necessarily protect the freedom of the individual inherent in democracy. Serving, legislating, regulating, debating, voting and all other MLA actions, if not properly focused, could erode our democratic principles.” The Honourable Raymond (Ray) Speaker, PC, OC Review of Compensation of Members of the Legislative Assembly of Alberta | 5 REVIEW OF COMPENSATION OF MEMBERS OF THE LEGISLATIVE ASSEMBLY OF ALBERTA | MAY 2012 REPORT Table of Contents Acknowledgements 8 Summary of Recommendations 9 Section 1: Introduction 10 1.1 Mandate ..................................................................................................................................................................................................................... 11 1.2 Guiding Principles ..................................................................................................................................................................................................12 1.3 Publicity of Review and Summary of Evidence Gathered ......................................................................................................................13 1.4 Principle Areas of Concern ..................................................................................................................................................................................15 Section 2: Evidence 16 2.1 Current MLA Compensation and Benefit Package ....................................................................................................................................17 2.2 The Role of an MLA ...............................................................................................................................................................................................19 2.3 The Highs and Lows of the Position of MLA ................................................................................................................................................22 2.4 Fair Compensation ................................................................................................................................................................................................24 2.5 The Use of Comparators ......................................................................................................................................................................................26 2.6 Hay Group Report ..................................................................................................................................................................................................28 2.7 Aon Hewitt Report.................................................................................................................................................................................................30 Section 3: Conclusions and Recommendations 32 3.1 Base Salary ................................................................................................................................................................................................................33 3.2 Offices Other Than MLA ......................................................................................................................................................................................35 3.3 Tax-Free Allowance ...............................................................................................................................................................................................39 3.4 Transition Allowance ............................................................................................................................................................................................41 3.5 Pension ......................................................................................................................................................................................................................43 3.6 Other Benefits .........................................................................................................................................................................................................47 3.7 Indexing .....................................................................................................................................................................................................................48 3.8 Future Review ..........................................................................................................................................................................................................49 3.9 Implications of Recommendations .................................................................................................................................................................50 6 | Table of Contents REVIEW OF COMPENSATION OF MEMBERS OF THE LEGISLATIVE ASSEMBLY OF ALBERTA | MAY 2012 REPORT Appendices 52 A List of Alberta papers that carried notices of the review and copies of the notices.....................................................................54 B Calendar of when notices appeared in papers ...........................................................................................................................................62 C Cheryl Scarlett’s written submission and exhibits ....................................................................................................................................64 D Member cash compensation comparisons for provincial, territorial and federal legislators in Canada ..............................92 E Member total compensation comparisons for provincial, territorial and federal legislators in Canada ..............................94 F Dr. Allan Tupper’s written submission............................................................................................................................................................96 G Dr. David Docherty’s written submission ...................................................................................................................................................115 H Raymond Speaker’s written submission .....................................................................................................................................................122 I Dr. Herbert Grubel’s written submission.....................................................................................................................................................130 J Hay Group Report ................................................................................................................................................................................................152 K Aon Hewitt Report.............................................................................................................................................................................................. 224 L Transcripts from the January 23rd, 2012, public hearings in Edmonton ........................................................................................ 238 M Transcripts from the February 2nd, 2012, public hearings in Calgary ............................................................................................. 277 N Member total compensation comparisons and proposed Alberta salary and pension (FULLY TAXABLE) ........................318 O Member total compensation comparisons and proposed Alberta salary and pension (w/ TAX-FREE ALLOWANCE) .. 320 P Cabinet Minister total compensation comparisons and present Alberta Cabinet salary ....................................................... 322 Q Cabinet Minister total compensation comparisons and proposed Alberta Cabinet salary (FULLY TAXABLE) .................324 R Cabinet Minister total compensation comparisons and proposed Alberta Cabinet salary (w/ TAX-FREE ALLOWANCE) .........................................................................................................................................................................................................326 Table of Contents | 7 REVIEW OF COMPENSATION OF MEMBERS OF THE LEGISLATIVE ASSEMBLY OF ALBERTA | MAY 2012 REPORT Acknowledgements The Commission thanks the Legislative Assembly Office for information provided for this review. The Commission also thanks all the participants who shared their views at the Edmonton and Calgary public hearings; in particular, the Honourable Ray Speaker, Dr. Allan Tupper, Dr. David Docherty and Dr. Herbert Grubel. The Commission is grateful to Jessica Hogan for providing professional writing and editing expertise in the preparation of this Report. To all those who provided a written submission, the Commission is grateful for their interest. 8 | Acknowledgements REVIEW OF COMPENSATION OF MEMBERS OF THE LEGISLATIVE ASSEMBLY OF ALBERTA | MAY 2012 REPORT Summary of Recommendations Compensation for the basic MLA role is expressed as a single amount and encompasses all legislative, constituency and committee
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