The Tories and NDP voted down a Liberal proposal Wednesday evening to convert the MHA Pension Plan to a defined contribution plan.
Two Liberal MHAs had to recuse themselves from the meeting of the House of Assembly Management Commission because they were in conflict. That gave the opposition parties the majority at the meeting.
Opposition leader Paul Davis moved that the commission accept a recommendation by the Members’ Compensation Review Committe (MCRC) as is. The motion carried after limited debate.
The independent committee had recommended altering the MHA Pension Plan to save $3.6 million from its unfunded liability, but it would remain a defined benefit plan. The new terms were supposed to apply to the rookie class of MHAs first elected in 2015, but last December the management commission voted to grandfather in those MHAs under the older, more lucrative rules.
After public outcry, the Liberal caucus proposed a defined contribution plan that would eliminate the risk to taxpayers and save $5.2 million. That plan was modeled on an existing defined contribution plan offered to some government employees.
The Liberal proposal also included a faster vesting period than what had been proposed by the MCRC. The independent committee had proposed two options for pension reform, one of which included a defined contribution component that would vest after two elections. The Liberal caucus plan would have vested after just two years of service.
Davis and NDP MHA Lorraine Michael both argued that the Management Commission should leave it to an independent body to make decisions on MHA compensation and benefits. They argued that was the intent of Justice Derek Green in 2007, when he had reviewed MHA compensation after the House of Assembly spending scandal.
Government House Leader Andrew Parsons noted that Justice Green had also recommended the House of Assembly Management Commission should move to a defined contribution plan.
In the end, Davis’ motion carried to accept the MCRC’s defined benefit plan as recommended.