Alberta MP Leon Benoit recently responded to an email sent to him from a supporter of the Canadian Taxpayers Federation (CTF) in which he contorts his way out of questions on MP pensions the way Neo dodges bullets in The Matrix. He did likewise in a recent letter to the editor of the Lloydminster Meridian Booster. But while Neo can defy the laws of gravity in The Matrix, Mr. Benoit can’t defy the laws of math.

One has to wonder if he would have written a letter with such untruths if he knew that the CTF would get a hold of his response and post it at taxpayer.com.  

In his letter, Mr. Benoit makes the claim that “the numbers put forward by the Canadian Taxpayer Federation – and repeated by the media - are not accurate." 

Is that so?

Well, we challenged Mr. Benoit to step up and release his pension eligibility publicly. I personally spoke with him just this Monday and offered to apologize publicly and issue a correction at taxpayer.com if he would provide documentation proving that we were wrong. Eat crow for Thanks Giving. Below is a closely paraphrased clip of our conversation. 

Mr. Benoit’s response: “I don’t want to get into a peeing match with you.”
CTF response: “Well you’ve said that we were wrong publicly. You have a duty to provide evidence to back that up. If we’re wrong, we’ll apologize”
Mr. Benoit: “I don’t want to get into a peeing match with you.”
CTF: “Have you been to Member Services to see what your pension eligibility is?”
Mr. Benoit: “No.”
CTF: “So, you don’t know what your pension eligibility is?”
Mr. Benoit: “No I don’t.”
CTF: “Then how do you know that we are wrong?”

The conversation didn’t get much more useful from there. But that’s not to say that he is being less forthcoming than some of his colleagues (in all parties) on the topic of their pensions. 

Other MPs angry at the CTF for releasing their pension numbers have also squawked that “the CTF’s numbers are wrong!” Guess how many of those MPs have released their pension figures? 

We’re still waiting for the first one, including Keith Martin’s.

Mr. Benoit may not want to start a pissing match, but it’s a little late for that. Let’s unzip.

Calculating Leon Benoit’s Big Pension

MPs accrue 3% of pensionable service for each year served, although for several years from 1993 until 2000 it was between 5% and 4%. From the time of Leon's first election in October 1993 until the next scheduled election in October 2015, that works out to 77%, although he will be capped at the 75% maximum.

He has also held various committee chairmanships and vice-chairmanships that give him an extra 1.3%, which is not subject to a cap. Together, that gives Leon 76.3% of his salary.

That 76.3% is now multiplied by the average of his best five years salary. To make our figures 'conservative' for all MPs, we used the current salary of $157,731, and did not index it upwards, even though it appears it will be increasing.

Therefore 76.3% of $157,731 is an annual pension of $120,411.

Mr. Benoit was born in 1950. Therefore, he will likely collect a pension for 15 years if he retires in 2015 and lives until 80. Again, that age estimate is conservative. Indexing each year at 2.04%, that gives Mr. Benoit an estimated lifetime pension of $2,088,340, not including spousal entitlements.

Do the math yourself. Do it again. The only difference you’ll find is that our assumptions actually low-ball his pension. By 2015, it will in fact be higher (under the current formula). 

Promised Never to Accept MP Pension

Now some of you may recall that in 1993, Mr. Benoit signed a written pledge to never accept a gold-plated MP pension. He used that pledge to get elected, but in 2000 went back on that pledge when he opted into the plan. Now, every financial advisor on the planet would have advised Mr. Benoit to “buy back” into his contributions for the plan retroactively to 1993, but in the off chance that he kept his word for at least a few years, let’s calculate his pension eligibility as if he only entered the plan on January 1^st, 2000.

With one year accruing 4% of salary and 15 years accruing 3%, plus another 1.3% for extra duties, that comes to 50.4% by the time of the scheduled 2015 election. Multiplied by his salary, that is an annual, indexed pension of $79,470, or $1.4 million by the time Mr. Benoit reaches age 80. Again, low-balling his salary average and not including spousal benefits.

Since Mr. Benoit openly broke his pledge never to accept the pension, it is unlikely that he wouldn’t want to cash in on the time served between 1993 and 2000, but since these records are private (and he refused to share them), it’s impossible to know.

$24 to $1 Contributions

Mr. Benoit and other peeved MPs have also attacked the CTF’s calculation that they only contribute $1 for every $24 that taxpayers contribute. Well, how about a math lesson on that one too?

MP pensions are so rich that they would be illegal under Income Tax Act for regular Canadians, so MPs carve themselves a loophole by setting up two pension accounts. Between these two accounts, ‘government contributions’ equaled $26.7 million in 2010-11 while MPs and Senators contributed just $4.5 million. That is an official contribution rate of $5.90-to-$1. (Which makes his claim of a $3.60 to $1 ratio, not even remotely correct).

But wait, it gets better. Federal regulations require that every year, taxpayers kick in 10.4% of the total value of the MP pension plan. That is just a fee that MPs give themselves to grow the plan like clockwork, since their pensions aren’t actually invested in the market. This extra taxpayer top-up accounted for $83.4 million in 2010-11. Additionally, taxpayers also provided a bailout – known as a ‘actuarial adjustment’ – of $600,000. That brings the total taxpayer contribution up to $110.7 million.

Let me hold your hand on this one my angry MPs: a taxpayer contribution of $110.7 million and your contribution of $4.5 million means that taxpayers are contributing $24.36 for every $1 that you do.  

If you don’t believe me, look at the government’s own Actuarial Report and do the math yourself. Page 32 is particularly enlightening.

Mr. Benoit either knows this and chose to, let’s say, “invert the truth,” hoping that we wouldn’t see his letter, or like Scotiabank might say, “He’s richer than he thinks.”

In either case, Mr. Benoit should either release his pension figures for Canadians to see, or apologize for his misleading and disingenuous statements.

He can email it to us at [email protected].

For more details you can read the CTF Report on MP Pensions