Robbing Private Peter to pay Public Paul more
There is a solution to the runaway public pay in B.C. – a Public-Private Compensation Equity act that could take the politics out of setting pay for government workers – and some the sting out of taxes for the taxpayers. ICBA President Philip Hochstein highlighted the idea in a letter to the Vancouver Sun in response to a column and Fraser Institute report issued yesterday. The letter is below.
Don Cayo’s Jan. 24 column highlights one of the great challenges facing governments across B.C. – the public pay premium that continues to grow. Right now, getting a paycheque from the federal, provincial, or municipal governments in B.C. means getting close to a 14 per cent premium over someone doing the same job in the private sector.
And that’s just the pay premium. The report also highlights the costly benefits that public workers get at taxpayers’ expense – richer pensions, longer holidays, earlier retirement, and rock-solid job security. When you consider the fact that staffing is one of the biggest costs government faces, it’s no wonder they keep telling taxpayers money is tight.
There is a solution – one that our organization has been championing for more than a year – public-private compensation equity legislation. There would be two-broad thrusts to such a law.
First, it would set up a market-based model to guide future public sector wage rates and compensation packages. This would address the significant disparity over time and bring compensation for the government workers in line with private-sector workers in the same jobs.
It could be handled by an independent, five-member Compensation Equity Board of economists, actuaries, and accountants. Their decisions would be made according to employment category, with geographic and market based adjustments, just like in the private sector.
It’s been done before. In the early 1980s, at a time of great economic uncertainty due to inflation and high interest rates, there was the Compensation Stabilization Board that took the politics out compensation to get a fair result.
Any politician with courage could seize this idea and run. It looks like a political winner. A survey done by Angus Reid last year showed that four out of five British Columbians thought government employees should be paid the same amount as people doing the same jobs in the private sector. That seems one of the few things all British Columbians come close to agreement on.
Imagine winning the support of the vast majority of British Columbians – and cleaning up governments revenue woes in a single step? It’s an idea whose time has come.
Philip Hochstein, President
Independent Contractors and Businesses Association of B.C.