MPs have long been criticized for having overly generous pension plans, but a new omnibus budget bill tabled Thursday could lead to dramatic increases in their contributions.
Under the Jobs and Growth Act, MPs would contribute $39,000 a year, up from $11,000 a year, toward their pensions.
鈥淚 think it鈥檚 good news for taxpayers,鈥� Treasury Board President Tony Clement said on CTV鈥檚 Power Play. 鈥淚t鈥檚 doing the right thing and paying our fair share.鈥�
If the bill passes, the increased contributions will be phased in beginning Jan. 1, 2013 and be fully implemented by 2017, according to Clement.
The 450-page bill also proposes the age at which MPs can collect their full pension be raised from 55 to 65.
That change would be effective Jan. 1, 2016, Clement said.
With the proposed changes, public servants and MPs would pay 50 per cent of their income into retirement funds.
The increase for public servants 鈥� from about 37 per cent 鈥� would also be effective on New Year鈥檚 Day, according to Clement.
鈥淭hat鈥檚 where the big savings are,鈥� Clement said, adding that the increased contributions will save taxpayers $2.6 billion over five years.
Although critics have slammed the scope of the bill, Clement suggested there has been no push back from public servants.
鈥淲e did indicate this in budget 2012, and this is a budget implementation bill, so it鈥檚 not really surprising at this point,鈥� he said.
While C.D. Howe鈥檚 Alexandre Laurin told Power Play he congratulated the move to 鈥渂ring the public servants鈥� compensation more in line with the private sector,鈥� there is still a huge disparity between pension plans for MPs and those for the average Canadian.
For example, Laurin said, under the MPs鈥� pension plan, 50 per cent of MPs鈥� pay is tax sheltered, whereas for the average person putting money away in RSPs, the figure is 18 per cent.
鈥淭here鈥檚 still not the parity that we would like,鈥� he said.
With files from The Canadian Press
