WINNIPEG – When Progressive Conservative Larry Maguire quit the Manitoba legislature to run for a federal seat, he received $85,564 in transition pay under a formula that was enhanced after the last provincial election.
Maguire is not alone — most politicians across the country receive some form of severance package when they leave office. But his case has one lobby group calling for an end to such payouts when politicians resign of their own free will.
“I don’t think the public would have a problem with a politician who is defeated (in an election) receiving a reasonable severance package,” Colin Craig of the Canadian Taxpayers Federation said.
“But in a case where a politician chooses to quit, I think the public would have concerns, especially given how generous the benefit is.”
The benefit varies across the country. Many provinces offer a package — often called a transition payment or severance — that offers politicians one month of pay for each year they worked. Most payouts are capped at a maximum limited to anywhere from six months to 18 months.
The money is meant primarily to help politicians, especially those who are defeated in an election, until they find new work.
In Alberta, a more-generous plan was axed last year. It gave three months of pay for each year and was not capped. As a result, longtime cabinet minister Ken Kowalski received $1.2 million when he retired in 2012 after 33 years. The Alberta plan was generous largely because it replaced a pension program that former premier Ralph Klein eliminated in 1993.
In Manitoba, where politicians have a pension plan, severance pay has changed over the years, but has been calculated primarily on one month of severance for each year of work. People elected prior to 1995 had payments capped at one year, regardless of whether they were voted out of office or quit voluntarily.
As a result, former premier Gary Doer received $85,564 when he resigned in 2009 to become Canada’s ambassador to the United States, according to the government’s annual public accounts report. Former finance minister Rosann Wowchuk received the same amount when she retired in 2011.
In 1995, the government lowered the maximum payout for politicians who were elected after that date and who quit voluntarily to six months of pay instead of one year. Politicians voted out of office were still eligible for a full year’s severance.
Following the 2011 election, an independent commissioner hired by the province to examine political salaries and benefits said the six-month cap was too low and ruled it should be raised back to one year.
The change allowed Maguire to resign last year with a full year’s severance after spending 14 years in the legislature. He quit to run for federal office in the longtime Conservative stronghold of Brandon-Souris, and scraped by Liberal opponent Rolf Dinsdale in a close contest. He was soon making double his provincial salary as a member of Parliament.
Maguire said his severance was “adequate” and he is considering giving some of it to charity once he goes through his tax returns and determines how much of it he has netted. Some of the severance was paid out in the current tax year, he said.
Maguire also stressed he and other politicians did not set the amount. Under provincial law, the legislature cannot make changes to the independent commissioner’s report. It can only adopt it or reject it in its entirety.
“The commissioner makes those decisions and puts them forward as a package, and we’re not allowed to pick and choose out of those,” Maguire said.
Other politicians who served shorter terms have also received transition payments after quitting voluntarily.
Former New Democrat Bill Blaikie received $18,000 when he retired in 2011 after 2 1/2 years in the legislature, shows that year’s public accounts report. Former Tory leader Hugh McFadyen was paid $47,352 when he quit in 2012 after a little more than six years.
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