Potential MHA compensation changes total $4.4 million
Report said public agrees, but author admits consultation response was low
When a report last month said the public agreed MHAS should get a pay raise, many people on social media questioned exactly who and how many people were consulted.
It turns out the number was low.
The report, titled “How We Value Democracy,” was prepared for the House of Assembly Management Commission to inform a decision about MHA salaries.
Currently they earn a base salary of $95,357 — making them the highestpaid legislators in Atlantic Canada — with more income if they serve certain other roles.
The report recommends the base salary should be increased to $120,000.
Former deputy minister Heather Jacobs was appointed to prepare the report.
At a Management Commission meeting on Thursday, Jacobs admitted that the public consultation, which partially informed her report, was low.
She said she sought public opinion by issuing two news releases, on Dec. 12, 2023 and Jan. 8, 2024, and social media was also used to try to get public attention. Public input was invited through written submissions or attendance at virtual sessions.
“To be honest, public engagement was low, but I don’t think it was any different in 2009, 2012, or the 2016 (compensation reviews). They did road shows that were poorly attended,” she said.
Jacobs did not bring up the level of public consultation when explaining the details of her report to the Management Commission. She offered that comment after Bonavista MHA Craig Pardy asked about the public consultation.
Earlier in her presentation, when discussing her assessment of MHA pay, she said “the public is supportive of an increase.”
EXTRA DUTIES, EXTRA PAY
Details of Jacobs’ recommendations were more thoroughly reported in The Telegram’s previous story on this subject on March 28, but generally speaking she recommended:
• base salary increases, as well as increases in pay for other MHA duties (such as serving on committees, for example) as well as implementing pay for some duties which currently do not include extra pay;
• implementing a salary adjustment formula so MHA salaries would automatically be adjusted annually to keep pace with inflation and the government’s executive pay plan;
• changes to severance eligibility;
• reinstatement of pensions for MHAS first elected Nov. 30, 2015;
• many changes to allowances, such as mileage and meal reimbursement.
WHAT WOULD IT ALL COST TAXPAYERS?
The base salary increase would add an extra $985,720 to the legislature’s annual budget.
The extra pay for specific duties would add $143,700 annually.
The salary adjustment formula didn’t have a specific financial implication because it is recommended to begin July 1, 2025 and would be based on the percentage change to the consumer price index at the end of 2024. However, as an example, if their salaries were already tied to inflation they would have made $126,828 in 2021, according to the report.
Changes to severance would increase the province’s liabilities by $612,400.
There would be an additional cost of about $25,000 every election year for career counselling, training and education for departing MHAS.
To reinstate pension benefits for MHAS first elected Nov. 30, 2015 would cost $1,472,000. The increase in the current service cost of benefits accruing in the first year following the valuation is estimated to be $163,000.
The increase in pension benefit obligations as a result of salary increases to $120,000 would cost $875,000 ($175,000 per year for five years), plus $55,000 for the offset of the increase in the pension service cost as a result of the increased portion of the salaries.
Finally, changes to eligible allowances for MHAS would increase that cost by about $95,000 annually (an extra $67,000 for mileage and $28,000 for meals).
All of these added costs total $4,426,820, not including the cost of tying salaries to inflation.