Franco Terrazzano is the Federal Director of the Canadian Taxpayers Federation.Here’s a quirky historical fact: Politicians who have successfully fixed government finances have taken one key action — they cut their own pay. The federal deficit ballooned to $55.6 billion following the 2008-09 financial crisis. Then-prime minister Stephen Harper froze member of Parliament pay between 2010 and 2013 as a first step to get Canada’s finances back on track.“Canadian families and businesses have accepted the need for restraint, fairness requires that government too should have to keep costs under control,” said then-finance minister Jim Flaherty during his 2010 budget speech. .OLDCORN: Using the notwithstanding clause to end the Alberta teachers' strike was right.Harper also made politician pensions more affordable for taxpayers by raising the retirement age, reducing benefits, and requiring higher MP contributions. He personally forfeited an estimated $1 million to $2 million in payouts by implementing pension reforms. The federal government shed 25,000 bureaucrats and ran a $1.9 billion surplus by the end of Harper’s reign.MPs also reduced their own pay before embarking on a successful cost-cutting campaign in the 1990s..The federal deficit reached about five percent of GDP in the 1990s. That’s equivalent to about a $150-billion deficit today. The Chrétien government cut 45,000 bureaucrats and turned that deficit into a $3 billion surplus in just three years. The prime minister and ministers took a five percent pay cut and froze MP pay in 1992, according to the Library of Parliament. Politicians’ salaries were frozen until 1997, when Ottawa balanced the budget. Even after the 1997 pay raise, ministers and the prime minister were taking lower salaries than they were in 1991. The same story played out across the provinces..ROMAN: Ottawa attacks the provinces with a Supreme Court showdown over the notwithstanding clause.Alberta had the highest deficit per capita in the country when Ralph Klein became premier in 1992. Klein held up a “paid in full” sign a dozen years later and told a cheering crowd he was “very, very proud to announce that Alberta has slain its debt.”How did Klein do it? He started by cutting politician pay by five percent and the size of the cabinet from 26 to 17 ministers. Klein also ended MLA pensions. Saskatchewan’s NDP premier Roy Romanow cut cabinet ministers’ salaries by five percent, froze MLA pay, and cut pay for extra duties. During Ontario’s Common Sense Revolution, then-premier Mike Harris changed the lucrative politician pension plan to a defined-contribution program. .Fast forward to today, and federal finances are once again covered in red ink. The government doubled the debt in less than a decade, and taxpayers now pay $1 billion every week to cover the interest.Carney promised to “balance the operating budget by Budget 2028” during the election. .PARDY: The Referendum goose is cooked.The bureaucracy now consumes about 55% of the operating budget. The government added 99,000 extra bureaucrats and increased the cost of the bureaucracy 77% since 2016.That means the Carney government must shrink the bureaucracy to fix the budget. And to shrink the bureaucracy, Carney must show politicians are willing to make tough decisions on their own pay..Government unions pointed to “the yearly salary increases of senators and members of Parliament” as a reason why bureaucrats should take more money before they went on strike in 2023.MPs took six pay raises since the beginning of 2020, ranging from an extra $30,900 to $61,800. A backbench MP’s salary is now $209,800 – nearly three times more than what the average Canadian worker earns. A minister’s salary is now $309,700, while the prime minister’s salary is $419,600. .EDITORIAL: O Canada isn’t your personal soapbox, Mr. Saxe.MPs also get a pension after serving for six years, a $104,900 base severance if they aren’t eligible for that pension, and a $15,000 transition allowance after leaving office. Prime ministers also get a second pension. Former prime minister Justin Trudeau will collect an estimated $8 million through his two pensions over his lifetime. Carney needs to shrink the bureaucracy to pull the government out of its debt hole. As history shows, his first step should be cutting politicians’ pay and perks. Franco Terrazzano is the Federal Director of the Canadian Taxpayers Federation.
