Provincial politicians on Prince Edward Island are making more this year than they did in 2022.

As of January 1, 2023, MLA salaries increased 2.75 per cent, according to P.E.I.'s Indemnities and Allowances Commission (IAC).

That increase means the politicians' base salaries will go from $76,439.84 to $78,541.94.

The IAC's annual report for 2022 cites inflation as a key reason for the pay increase.

"Upon analyzing the Consumer Price Index, Gross Domestic Product, indemnities in other jurisdictions, historical data, and written submissions from the public, the Commission adjusts the indemnity for the role of MLA," the document states.

MLAs on P.E.I. are currently paid less than their counterparts in all other provinces across the country.

"The politicians' incomes are falling behind," said Ron Profit, chair of the IAC. "We looked at the past 10 years ... it shows they are making at least $4,500 less than they made 10 years ago when adjusted for inflation."

$500 cap on expenses

There was also a change to expense allowances, which cover things like travel or community events. Those will now be capped at $500 dollars a month per person.

Before this, there was no cap on expenses.

"We are somewhat overseeing what expenses there are and controlling what expenses can be charged up to the public," Profit said.

When it comes to severance pay, those elected on or after Dec. 1, 2021, will receive lump sums in bi-weekly payments if they leave office. MLAs will also stop receiving severance if they become a judge, federal member of Parliamant or take on another job in public service.

That severance is now based on career average salary, where it was previously based on the salary at the time of leaving office.

Those severance payments top out at one year of base salary.