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Mar 20, 2014

Ontario proposing to continue freeze of MPP salaries

Would extend until budget balanced in 2017-18
    
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Ontario has introduced legislation that would, if passed, extend the current freeze on MPP salaries until the provincial budget is balanced in 2017-18.

If passed, the MPP Salary Freeze Act would not allow pay increases to take effect until April 1, 2019, after the public accounts confirm a balanced budget.

Compensation costs account for more than one-half of all Ontario government spending, either paid directly through the Ontario public service or as part of the government's transfer payments to universities, hospitals and other public sector partners, said the government.

"This government will continue to take a determined and disciplined approach to eliminating the deficit while continuing to invest in services and programs that families rely on. Ontario is the leanest government in Canada, but with over half of the budget going to the cost of compensation, we must all do our part in a responsible way. We continue to lead by example,” said Charles Sousa, minister of finance.

•In 2004, a salary freeze for MPPs was implemented from October 2003 until April 2005. The 2009 budget announced that MPP salaries would be frozen for one year beginning on April 2009. That salary freeze was extended in the 2010 budget for two years and in the 2012 budget for an additional two years, bringing the total length of the current pay freeze to five years.

•In 1996, the defined benefit pension plan for MPPs was wound up and members and beneficiaries were paid the value of the benefits earned to that date. MPPs now have a defined contribution pension plan.

•Since 2009, Ontario has initiated compensation restraint measures for members of the Ontario public sector and broader public sector, and has indicated that compensation costs must be managed within Ontario’s existing fiscal framework.

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