Here we go again: Jim Prentice’s ‘5% Solution’ is bad policy, but irresistible politics

Posted on January 30, 2015, 2:12 am
8 mins

PHOTOS: Déjà vu all over again – the Alberta Legislative Building back in the day. Below: Retired Judge John Major, Winston Churchill and the ever-quotable Yogi Berra.

Alberta Premier Jim Prentice’s “5-Per-Cent Solution” announced yesterday, whereby political salaries are symbolically trimmed to help justify other unpopular cuts in public services and an across-the-board attack on the salaries of the public employees who deliver them, is bad policy, but irresistibly good politics.

With an election looming, no working politician wants to be the one who states the obvious, that political work is important work and the people who practice it, no matter what their political persuasion may be, deserve to be sensibly but not excessively compensated for their efforts.

major-inquiry070309This fear is justified because the ever-diminishing percentage of Alberta citizens who actually vote can be counted on to suffer from a near-permanent state of policy amnesia.

So while most politicians will privately agree the question of how much they get paid needs to be systematized and separated by the length of an arm or more from their own deliberations, few can summon the foolhardy courage to state the obvious when a manipulator like Mr. Prentice is spinning this nonsense to set the stage for a fight with modestly paid public employees.

As with almost everything about this latest convenient and temporary dip in the price of oil – which has conservatives of all stripes quoting Winston Churchill about the desirability of never letting a good crisis go to waste – we have been here and done that before with decidedly mixed results.

Ralph Klein rolled back cabinet salaries by 5 per cent in 1993 to start the ball rolling on his efforts to justify attacks on public sector services, especially health care. (Although not the pay of provincial court judges, as it turned out, who to the premier’s annoyance were able to persuade a higher court that such a cut would interfere with their judicial independence.) Mr. Klein also rolled back MLAs’ pensions by replacing their pension plan with payouts upon departure.

Winston-ChurchillUltimately, this led to the “Kleintastrophe,” from which health care in Alberta in particular is still recovering, but that will have to be the topic for another day, probably soon.

The result of Mr. Klein’s temporarily irresistible symbolism was that, immediately after winning the 2008 election, members of the cabinet of premier Ed Stelmach gave themselves significant pay increases of about 30 per cent.

Mr. Stelmach argued, rather bravely given the nipping and yipping at his heels from the usual suspects, that Alberta’s politicians hadn’t had a raise in 15 years and the extra money was needed to attract qualified people.

None of this would have been necessary, of course, if governments in Alberta possessed the management skills to plan for the inevitable ups and downs of a resource-based economy. Alas, our Conservative governments never fail to be taken by surprise by the fact that petroleum prices go up and down.

The next premier to try to deal with that was Alison Redford, who had the sensible notion of appointing an impartial person (a retired judge with the same name as a Conservative British prime minister as it turned out) to find a way to set politicians’ salaries without tears.

Alas, retired Supreme Court justice John Major’s report in May 2012, while making an enormous amount of sense, recommended a salary increase for the premier too big to be politically palatable and Ms. Redford soon succumbed to the temptation to fiddle with his prescriptions.

Mr. Major had reasonably enough recommended the reintroduction of a pension plan for the politicians and an end to the lucrative committee pay by which Alberta MLAs sneakily added to their salaries without, they hoped, offending voters.

He also called for political salaries to be reviewed and set every three years by a panel of provincial court judges, instead of by the politicians who benefit themselves.yogi-berra

But his suggestion that a premier (not any particular premier) should be paid about the same as a judge – more than $300,000 – was too much for Ms. Redford in the political context of the day. Ditto the pension proposal.

After the resulting brouhaha, Mr. Major huffily remarked, “I was not asked to write a report that I thought the premier would accept. I wrote a report on what I thought the premier’s job was worth. If the premier doesn’t see her job as being worth what I’ve recommended, she’s perfectly free to not accept it.”

She didn’t, although basic MLA pay was raised in 2013 under a simplified system to just over $134,000 a year, with higher rates for cabinet members and a few other legislative jobs. Late in the year, an increase in RRSPs raised total combined annual compensation for MLAs to $156,000.

This compared with a base salary a hair over $78,000 in 2008, a percentage increase of about 72 per cent in base salaries, although the percentage would be lower than that with the pre-2013 committee pay received by many MLAs added in. The premier’s pay rose about 37 per cent in the same period, if my late-night back-of-the-envelope calculations are accurate, always a risky assumption.

Regardless, these are, it is said here, appropriate salaries given the importance and nature of the work MLAs do.

MLA pay was then symbolically “frozen” for three years in 2013 as the Redford Government tried to force civil servants to take a pay freeze – although without the big raise cabinet and MLAs got just before it. Ultimately, this campaign failed an agreements were negotiated and signed containing modest pay increases.

Perhaps if Ms. Redford had possessed 20-20 foresight about her fate, she would have implemented Mr. Major’s full recommended pay policy changes anyway and suffered the slings and arrows of the Canadian outrage industry to leave us with a better system.

Instead, we’re experiencing, as the pundit-like Yogi Berra famously explained, déjà vu all over again.

This post also appears on Rabble.ca.

16 Comments to: Here we go again: Jim Prentice’s ‘5% Solution’ is bad policy, but irresistible politics

  1. Jerrymacgp

    January 30th, 2015

    I think politicians should be paid a dollar a year, and instead given paid leave from their pre-politics employment, either through a salary replacement arrangement or by employers being reimbursed for their compensation while in office. Nobody should be either enriched or penalized by public service.

    Does this mean a ditch-digger would be paid less than a banker? Yes. But they would have been had they not been elected. This would just take salary out of the decision to run for elected public office.

    Reply
    • Anonymous

      January 30th, 2015

      Nothing for a parasitic bankster like Jim Prentice to dislike about that plan, Jerry!

      Reply
  2. Athabascan

    January 30th, 2015

    The more things change the more they remain the same.

    What the great unwashed masses of brain dead Alberta voters don’t realize is that there are two elements to wages. There is the obvious front-end money, and then there is what I call the back-end money. This so-called wage reduction only applies only to the front-end money, because that’s what scores the most political points.

    I’ve said this countless times, “I’m willing to take a 50% pay cut, but first pay me $1 million a year.” I call it fun with numbers. A 5% wage cut for someone trying to raise a family on $50,000 hurts a lot more.

    “We’re all in this together?’ I don’t think so.

    Reply
  3. K. Larsen

    January 30th, 2015

    I believe there was another consequence to Klein’s elimination of the so-called ‘gold plated’ Legislative Pension for MLAs. That pension meant MLAs became financially independent after serving six years, so longer-serving MLAs could threaten the Premier and Cabinet with embarrassment or mutiny at no real personal financial risk.

    This made it much harder to control the caucus. In our single party authoritian state this was a useful albeit it feeble, check on the unrestrained power of the Premier and on the Party brass in all the political parties.

    Reply
  4. ronmac

    January 30th, 2015

    Last week I was invited along to a department Xmas party by my daughter at an Edmonton area hospital where she works. They couldn’t get together during the holidays so it was a month late. It was a modest gathering at a local pub. At the end of the evening everyone was surprised to learn they expected to pay for their own meals and drinks including coffee.

    To make a long story short I can report this group of Alberta civil servants weren’t living high off the hog. Not on this night.

    Reply
  5. January 30th, 2015

    Seems to me it wasn’t that long ago they took at 30% increase?
    If the whole crew worked for no wages at all for the next 20 years it would not put a dent in what they have siphoned off of Alberta and tucked into oil pockets! They have firmly established themselves as Liars, Cheats and Thieves and reinforced those three when they were busted for stealing 6 billion dollars from the AIMCO held municipal and Government pensions!
    The RCMP cannot investigate this Government unless the Attorney General fist approves.

    We are down to a 2 party system in Alberta. The Conservatives, above and he NDP who, strengthened by the more common knowledge of Norway’s billions banked was all put there by socialist Governments who also supply free university education.

    The Alberta Party was established by oil not to win anything in particular but to split the vote on the left a wasted vote.

    Most of the Alberta Liberals sitting abandoned the Liberals and joined Trudeau’s Federal party. Going into the Election Against Stelmach the issue was defined as Royalty and the lack of them. The Liberals were 700 thousand dollars in debt. At the 11th hour, after a debate in which he didn’t participate he declared the election was about butterflies on the moon or something equally misconnected thereby throwing the election he probably would have won.

    The problems remain the same! If people in Alberta do not turn out for a vote, nothing will change!

    Reply
  6. MAGGIE

    January 30th, 2015

    “You know, people are basically shitty. It’s when they prove it over and over again that it gets obnoxious.” Frank Zappa

    Reply
  7. January 30th, 2015

    So, having done this exact same crap before (under King Ralph the barley-sodden), for the exact same crap reasons (political self-aggrandizement utilized as a camouflaged strategy for enabling forced sub rosa Right-wing societal transformation and concurrent corporate looting), therefore we can reasonably expect the same crap results (further destruction of the threadbare social contract between government and governed in this province).

    Noted thespian and pleasure-car enthusiast Jim Prentice will play the part of Lucy with the ever-irresistible football. The part of Luckless Crappy, er Charlie Brown will be played as usual by the Alberta voter for whom one mental wing (the Left) on average has completely atrophied and fallen away from disuse.
    Flying with two right wings begets a perpetual circular tumble in physics but that, like this situation is nothing new at all for this region.

    Reply
    • January 30th, 2015

      @darkblack nothing at all will change unless complainers on the web get off their tails and vote!

      Reply
      • January 31st, 2015

        Sir, I have voted in EVERY provincial election (in my province of residence) and Federal election since reaching the age of majority. If it is the will of the masses that they be led by defaulting their right to vote – a right secured by blood and sacrifice of our forebears, mine included – then we who do exercise our franchise must come to philosophical blows with such fatuous self-satisfaction, every time it occurs. As I believe you have implied in your reply – If one doesn’t vote, one can’t complain about the outcome. When I encounter those who wish to carp about the race to the bottom that passes for politics in this country, my first question after their rant ceases is, “So, did you vote?’ A negative answer ends the conversation.

        Reply
        • January 31st, 2015

          @darkblack Thanks for a couritous and full reply. The Canadian participation in the voting process is abysmal to say the least. The Alberta Conservatives got an overwhelming majority with only 23% of the popular vote.
          I have kept close tabs on these guys for the past 7years or more on http://albertathedetails.blogspot.ca and Welcome to Rallp’s world before that. The latter as a contributor.
          Here is a snapshot of their legacy.

          1.Oil conventional and crude sold at either WTI or BRENT prices which ever was the lowest less 30%
          I estimate the loss to be close to 3 trillion dollars over the 15 years this practice has been going on. Big losers were the producers of this province, next the taxpayers.

          2. The original contracts taken out with the petro companies was 1% royalty taken until the plant was paid for at which point 32% royalty would kick in. In this way, Alberta taxpayers would have paid 100% of the building of the tar sands plants. The plants were just maturing when Ralph Klein took office and royalty being collected was 32%.

          When Ralph left office our royalty was 16% taken in US funds, based on US dollars.

          That was the best kept secret ever! Until, Fred Dunn, Auditor General chastised the Government for not collecting the 19% they said they were collecting. The Government started a hate Fred Dunn campaign while cutting the department budget to a non functional amount.. Fred Dunn resigned and a tame Auditor General was put in place.

          Next Stelmach on the eve of his second election published a document “The New Royalty Regime”;a pack lies with impossible numbers in it that got oil upset cause they were going to go broke on it. The semi literate still quote that document. Only 1 line at the very bottom meant anything “Revenues all taken in Canadian Funds” which was a loss to the province at that time of 18%

          The next we got a peek was when Ron Liepert Energy Minister took to the Airways after my persistent public complaints saying out royalty was now 6% and would only be there for 5 years and Albertan’s would have to tighten their belts. It promptly dropped to 0 taken on royalty!

          I place the losses on royalty at between 3 and 4 billion dollars.

          They froze the Heritage Savings and Trust fund at 5% putting everything above into General Revenues to be used as taxes while they claimed the lowest taxes in Canada. Loss on Heritage trust fund 700 billion dollars.

          It goes on and on into privatization of utilities. After being rolled to insiders 3 times upping the prices the service it was turned over to the cities to operate and collect profits. This replaced Government grants to a large extent. Hence the term Indirect Taxation. There is no control over the line charge on the bills. There are1.5 million homes in Alberta contributing to this scheme. Our electrical output is 13,000 MWH moving up to past 14,000. Not hard to figure how much money is being raked in when the line charges come along. EPCOR is the worst of the lot.

          I complained instantly about illegal aliens working the oil patches. Then came the crunch of 2008 and the Conservatives told us it cost taxpayers 6 billion dollars for those 2 years of support to the industry. Thing is most of the illegals were Americans who didn’t pay tax and were not qualified for EI.

          I knew the Government did not have 6 billion loose anywhere; they were living on lies and pushing P3 projects without naming parties. Then, I tweaked to AIMCO and downloaded their year end statements.Q4 read 8 billion dollars lost due to bad investments. (Their primary accounts were Government Pensions) and other like companies in their industry were posting 3% profits (modest) in the same period of time..

          I informed the unions and municipalities of the obvious theft. PSAC bounced them and for weeks they denied they had anything to do with the AIMCO loss. PSAC threatened court action; them against the Government and AIMCO and the Government relented and a settlement was reached. How much? No idea but circumstance would suggest it was a decent settlement. I don’t know however about the different municipalities. I suspect some of the individuals have taken a beating. So, there is another 6 billion added to their talley.

          Throughout this I have been begging people to vote all for nothing nor did ever receive a thank you from the unions.

          The oil industry has lost all its markets. The world is in turf fight and oil is tanking.There is no US inventory to suck up the millions of barrels floating around in tankers. Nothing is going to give for at least 6 years and I see Merkel is asking for more sanctions against Russia!

          She is begging for a war! Putin is still backed by his people on the Crimea and they are suffering badly.

          I spend a lot of time on right wing newspapers trying to educate Albertans and Canadians to a point they may well vote.

          Reply
  8. Pattison

    January 30th, 2015

    OMG. This confirms some research I did. But does Diamond Jim really give a rat’s rectum? Probably not. Why? Because he’s a sociopath. Rumor percolating was that Alison Redford score high on a reputable sociopath test.

    DOES THIS SOUND LIKE REDFORD AND PRENTICE … and some other wannabes?

    “You can play hardball with the best of them! You know what you want and are not afraid to go for it – even if it means bending the rules occasionally and putting a few noses out of joint on the way. Nothing fazes you. You are decisive, self-confident and pretty much up for anything. You are a ‘means-to-an-end’ person. For you, it’s not necessarily a matter of right or wrong, but of what gets the job done. ‘Bring it on’ is your mantra, but to help those around you keep their heads, you should learn some tricks to help you temper your self-satisfying tendencies…” (Kevin Dutton, Oxford University, 2014).

    Reply
    • January 31st, 2015

      There is another possibility; one that I personally prefer as far as Redford is concerned.
      She is quite possibly the most detested woman in Conservative politics. That said the Conservatives were down so very far in the polls they could see no daylight.

      I think they cut a deal with Redford to throw herself under the bus to provide enough show to take the voters minds off the trillions of dollars of Alberta revenue they plucked from Alberta coffers and turn their attention to the fluf that surrounded Redford.

      As far as the vote goes, there will be a hard push by corporations to keep their 10% tax.
      They will prompt their employees to vote Conservatives because the Alternatives are communist and some such tales of extremes.

      The everyday; walk around families who want some relief from the economic horrors that will fall upon us after the election to turn out and vote. Voting rules have changed so read up on them, make sure you are registered and turn out and vote NDP. They are smart, well informed and they need a healthy industry as much as any party does.

      All of this is for nothing if the vote does not turn out in quantity!

      Reply
  9. Pattison

    January 30th, 2015

    OMG! This confirms some research I did. But does Diamond Jim really give a rat’s rectum? Probably not. Why? Because he’s a sociopath. Rumor percolating under the dome was that Alison Redford scored high on a reputable sociopath test.

    DOES THIS SOUND LIKE REDFORD AND PRENTICE … and some other wannabes? This is what a certifiable sociopath looks like:

    “You can play hardball with the best of them! You know what you want and are not afraid to go for it – even if it means bending the rules occasionally and putting a few noses out of joint on the way. Nothing fazes you. You are decisive, self-confident and pretty much up for anything. You are a ‘means-to-an-end’ person. For you, it’s not necessarily a matter of right or wrong, but of what gets the job done. ‘Bring it on’ is your mantra, but to help those around you keep their heads, you should learn some tricks to help you temper your self-satisfying tendencies…” (Kevin Dutton, Oxford University, 2014).

    Reply
  10. Anonymous

    January 31st, 2015

    If left was serious about ‘winning’ they would start now with the mantra ‘ Old Privileged White Guy’.

    Reply

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