Today MLA pay goes up 2.81%, to $78,202 per year. This breaks down as follows: a $42,204 salary, plus a $21,102 tax-free allowance worth $29,248 in real terms, plus a $6,750 "RSP allowance." This "RSP allowance" is pegged at one half of the maximum allowable annual RSP contribution, which is determined by Ottawa. When the federal government raises the RSP contribution limit, Alberta taxpayers will automatically start paying their MLAs more, without any discussion or debate, or a vote.

Like most Albertans, MLAs do not have a pension plan in addition to their salary. Unlike most Albertans, upon leaving their employment MLAs will receive severance pay of three months' salary for every year on the job, based on the three highest-paying years as Premier, Opposition Leader, Speaker, Committee Chair, or other position. If all 83 MLAs quit in March of 2005, Alberta taxpayers will be on the hook for over $18 million in severance pay, including $544,564 for Premier Klein; $488,158 for Speaker Ken Kowalski; $366,119 for Liberal Leader Ken Nicol; and $140,496 for ND Leader Raj Pannu. Poor Ralph won't receive the pension he abolished in 1993, but $544,564 will help ease his pain.

MLAs chose to make an issue of their compensation on August 7, 2001. When most Albertans were in holiday mode, and media attention was focussed on the World's Athletics, MLAs on the Members' Services Committee voted themselves a 10% after-inflation raise, plus the very fat severance packages described above. The raise and the severance pay increases went into effect immediately, without any public input, less than five months after a provincial election in which this issue was not raised by the Tories, Liberals or NDs. Notification of this August 7 meeting was limited to the posting of a sheet of paper on a bulletin board somewhere inside the Legislature. Still, Committee Chair Ken Kowalski loves to call these meetings "public."

One very positive feature of MLA compensation is the automatic annual raise, pegged to the Statistics Canada "average weekly earnings" index for Alberta. Last year the Canadian Taxpayers Federation fully supported the 3.4% MLA pay raise. The problem was and is the 10% after-inflation increase passed on August 7 - and the hugely enlarged severance pay. Related problems include secrecy, lack of public input, lack of transparency, and conflict of interest.

MLAs should undo the mistakes made on August 7 and go back to the generous and adequate compensation that was already in place. If MLAs consider that too low, they should establish an independent committee of randomly selected, "severely ordinary" Albertans to examine MLA compensation, receive input from the public, and make recommendations, which MLAs should vote on in the Legislature, not at a secret meeting. To eliminate the conflict of interest which now exists when MLAs vote to increase their own pay, whatever recommendations the MLAs approve of (whether a raise or a pay cut) should not go into effect until after the next election. After that, automatic annual raises, in line with the earnings of other Albertans, are fair and just.