Government employees need to share in the tough times
Tough times require tough questions. One question is looming large in Alberta. When you look at government job growth, salaries, benefits and provincial comparisons you have to ask: when will Alberta’s government employees share in the tough times?
Unfortunately, that reality seems to be lost on some people.
“These folks and many, many others across the province took two years of zeros and negotiated this opportunity to have discussions around their wages for the third year,” said Guy Smith, president of Alberta Union of Provincial Employees (AUPE) prior to the union heading into arbitration hearings with the provincial government.
After reading a statement like that, you’d think our government employees have taken it on the chin, but you’d be wrong.
For thousands of government employees, “pay freezes” over the last few years weren’t actually pay freezes. While government employees may not have been rewarded with a new pay grid, they could still receive a raise by moving up their current grid.
A freedom-of-information request filed by the Canadian Taxpayers Federation shows that the “pay freeze” for nurses cost $17 million in 2017. The “pay freeze” for teachers cost an estimated $200 million over two years.
Even if government employees had their wages frozen, cuts would still be warranted.
Many Albertans outside of government would have killed for a wage freeze during the recent recession. Thousands of families dealt with pay cuts, layoffs, underemployment and other difficult situations. But instead of relief, taxpayers were forced to shell out more tax money to pay for a growing government workforce.
“Net private sector employment has declined by 39,700 jobs since May 2015 … The Alberta NDP added 58,600 jobs in the broad public sector — paid by taxes on the private sector,” explains economist Jack Mintz.
Total workers’ pay in Alberta has declined by seven per cent since 2014 highs. Yet total pay for government employees increased by 12 per cent between 2014 and 2018, according to government budgets. And this followed years of increasing government pay. Between 2000 and 2010, the government’s wage tab increased by 119 per cent, almost double the rate of growth in the rest of Canada.
Government employees in Alberta (at all levels) earn a 10 per cent wage premium compared to counterparts in the business community, according to the Fraser Institute. Then there’s the lucrative benefits that are scarce outside of government. Government employees are much more likely to be covered by a workplace pension, are more likely to receive a costly defined-benefit pension, retire earlier, enjoy greater job security and lose more work time for personal reasons.
Government employees in Alberta are also overpaid compared to other large provinces.
“Alberta could have saved around $2.1 billion in 2016, if public sector salary levels [per employee] were the same as the average of the three biggest provinces (British Columbia, Ontario and Quebec),” state former Saskatchewan NDP Finance Minister Janice MacKinnon and University of Calgary economist Jack Mintz.
Even politicians are sharing in Alberta’s tough times as MLAs will be paid $13,000 less compared to 2014 and Premier Jason Kenney will rake in $31,500 less.
Albertans are currently staring down the barrel of a $60-billion debt tab that is increasing by $1.7 million every single hour. But the only way we’re going to get the province’s fiscal house in order is by bringing government labour costs back to reality.
This column was originally published in the Edmonton Sun on August 14, 2019.