3. 3. Response to the Report
1. a) Recommendations 1-2: Salary Adjustments

3. Response to the Report

At the outset, the Government wishes to acknowledge and thank the Chair and the Commissioners for their comprehensive report on the full range of submissions received by the Commission. The Commission process was transparent and accessible, which contributed in an important way to public perception of the Commission's independence and objectivity in developing its recommendations. The thorough and thoughtful explanations provided in the Report reflect the seriousness with which the Commission approached its mandate and the care it took in its deliberations and recommendations.

As indicated throughout the Commission proceedings, the Government is fully committed to ensuring the effectiveness of the Judicial Compensation and Benefits Commission process in support of the principle of judicial independence. The Government regards this public Response to the Commission recommendations as a critical element in ensuring public confidence in the legitimacy of this constitutionally mandated process.

Briefly, for reasons set out below, the Government is prepared to accept all of the recommendations of the 2003 Judicial Compensation and Benefits Commission, with one exception. As also explained below, the Government does not fully accept Recommendation 16 relating to judicial representational costs, but rather will propose a modified costs formula.^[8] The Government will propose to Parliament that the necessary amendments to the Judges Act be implemented at the earliest reasonable opportunity.

a) Recommendations 1-2: Salary Adjustments

The Commission recommended a 10.8% salary increase effective April 1, 2004, inclusive of statutory indexing^[9]. The proposed salary of a puisne^[10] judge would rise from $216,600 to $240,000 as of April 1, 2004. There would be equivalent increases for Chief Justices and judges of the Supreme Court of Canada.^[11] Notably, the Commission declined to recommend a continuation of an additional annual salary component for the following three years, other than statutory indexing effective April 1 of each year.

In arriving at its salary recommendation, the Commission engaged in a careful balancing of all the factors listed in s. 26(1.1), including the prevailing economic conditions in Canada, the role of financial security in ensuring judicial independence, and the need to continue to attract outstanding candidates to the judiciary.

As with past Commissions, this Commission grappled with the challenge of identifying appropriate salary comparators given the unique nature of the judicial role. In arriving at its salary recommendations, the Commission had regard to a wide range of information concerning remuneration in both the public and private sector provided by the Government, the judiciary, and its own compensation experts. In addition to examining the traditional comparator of the DM-3^[12] salary mid-point, the Commission broadened its consideration to the compensation of other senior officials appointed by the federal Government, including all levels of deputy ministers and other Governor in Council appointees.

However, the Commission regarded private sector legal income as "…an important, and perhaps the most important, comparator…"^[13], because most appointees to the bench are drawn from senior lawyers from the Bar.^[14] The specialized professional nature of the pool from which the judiciary is drawn is one aspect of its unique nature. Accordingly the Commission gave particular consideration and weight to available information about the incomes of lawyers in private practice.

The Government is prepared to accept the Commission's salary recommendations for several reasons.

The proposed increase appears reasonable when considered as an increase of approximately 2.7% per year, above annual indexing, over the relevant four-year period (April 1, 2004 to March 31, 2008) given that the Commission declined to recommend the continuation of the annual salary increment that was implemented following the Drouin Commission's recommendations^[15] and that had been proposed by both the Government and judiciary.^[16]

Such annual increases are within a reasonable range of general compensation trends for senior members of the federal public service.

While the Commission's recommended increase (10.8%) is greater than what the Government proposed (4.48%, plus an annual increment of $2,000), it is nevertheless significantly less than the increase sought by the judiciary (17.2%, plus an annual increment of $3,000).

In light of all these factors, the Government is of the view that the Commission's salary recommendations are reasonable and will propose their implementation to Parliament.

It is important to note however that the Government's acceptance of the Commission salary recommendations should not taken as a complete acceptance of all of the assumptions made by the Commission with respect to the comparative analysis undertaken. The Commission itself identified the particular difficulty of assessing trends in the incomes of private practice lawyers. While significant efforts and progress had been made by both the Government and the judiciary in developing improved data and analysis, the Commission was left to do the best it could in light of the unsatisfactory nature of the information that is currently available in this area.

The Commission has in fact made a number of constructive suggestions to improve the process for future Commissions, particularly in relation to the development, under the auspices of the Commission itself, of more detailed and reliable comparative information in advance of the next Commission. As indicated, the Government is committed to ensuring that the Commission process is both objective and effective, and therefore welcomes these suggestions. The Government is fully prepared to participate in any discussions and joint efforts with the Commission and judiciary that would serve to improve the timeliness and reliability of information upon which the next Commission can rely.

^[8] The alternative formula is discussed infra., Recommendation 16, Representational Costs.

^[9] Recommendation 1: The Commission recommends that the salary of puisne judges be established as follows. Effective April 1, 2004, $240,000, inclusive of statutory indexing on that date, and for the next three years: $240,000 plus cumulative statutory indexing effective April 1 of each of those years.
("Statutory indexing": under the Judges Act, judicial salaries are indexed to the Industrial Aggregate Wage.)

^[10] "puisne" refers to a judge who does not hold the office of Chief Justice.

^[11] Recommendation 2: The Commission recommends that the salaries of the justices of the Supreme Court of Canada and the chief justices and associate chief justices should be set as of April 1, 2004, and inclusive of statutory indexing, at the following levels:

^[12] Deputy Minister, Level 3

^[13] p. 41, Report

^[14] pp. 31-32, Report

^[15] The 1999 Judicial Compensation and Benefits Commission was chaired by Richard Drouin, Q.C., and the other Commissioners were Eleanore Cronk and Fred Gorbet.

^[16] The Government proposal was for a 4.48% increase in the first year, with a $2,000 annual increment plus statutory indexing in the next three years. The judiciary's proposal was for a 17.2% first year increase, with a $3,000 annual increment plus statutory indexing in the next three years.