OTTAWA – The freeze on MP salaries, which hasn’t given them a pay raise since 2010, will be removed, with future increases tied to the average increase in public sector wages, Global News has learned.
The move will alleviate some of the financial pain MPs will feel as the government is about to unveil changes to their pension plan scheme.
Pension changes were first alluded to in the 2012 budget, although the document was thin on details.
During a caucus meeting yesterday, as a plane with a banner demanding the pensions be scaled back flew over the National Capital Region, Conservative MPs were hearing details of the proposed changes.
The changes include increasing MP contributions to their pensions to 50 per cent by 2016 from the current level, estimated at between 10 to 14 per cent, and increasing the age of eligibility for pension collection to 65 from 55. When the age of eligibility for Old Age Security reaches 67, as was recently legislated, MPs’ age of eligibility will be 67, as well.
Still on the table is the rate at which an MP’s pension builds up. Currently, it accrues at three per cent per year, but there is talk of lowering it to 2.5 per cent, or even two per cent.
These changes will hit MPs’ wallets, as they are forced to contribute thousands more each year to their pension plan.
As a concession, the government decided to lessen the financial burden by lifting the salary freeze it implemented in 2011.