Top Ministers in terms of internal costs were:

1. PM $121,884
2. Judith Collins $74,138
3. Pita Sharples $72,473
4. Steven Joyce $62,223
5. Tariana Turia $57,260

Worth remembering that expenses are to some degree a reflection of activity and location. Also affected by whether their ministerial home is owned or rented.

Total ministerial expenses for Q4 2011 were $1.16m plus $0.32m overseas travel for $1.48m. The year before in Q4 2010 it was $1.13m plus $0.86m overseas travel for $1.99m total. Obviously with the election, less travel.

Top MPs were:

1. Hone Harawira $54,961
2. Phil Goff $32,566
3. Rahui Katene $29,436
4. Kevin Hague $28,763
5. David Cunliffe $28,040

The total MPs expenses for the quarter were $3.15m. For Q4 2010, it was $1.80m. I guess the election saw a lot of taxpayer funded travel.

Decisions over MPs’ and ministers’ entitlements will be handed over to the independent Remuneration Authority, the Government has announced.

Prime Minister John Key said he had introduced legislation repealing the Civil List Act 1979 and bringing together more of the powers to decide MPs and ministers’ travel, accommodation and communications entitlements under one Act.

Under the new Members of Parliament (Remuneration and Services) bill:

* Most travel and accommodation entitlements for MPs and ministers would be set by the authority rather than Parliament’s Speaker or the minister responsible for Ministerial Services.

*MPs would be required by law to disclose their travel and accommodation expenses – they do so voluntarily at the moment.

* MPs will be docked 0.2 per cent of their salary – currently $270 a day – for non-attendance.

Over the last three years there has been a huge increase in transparency and accountability over MPs expenses. This continues that trend.

I still advocate that a further logical step is to change the timing of MPs salary years from annually in arrears to setting them once every three years just before the election. Then that pay rate applies for the term of Parliament, and MPs don’t have t put up with all the crap when the Remuneration Authority gives them a backdated payrise.

Decisions over MPs’ and ministers’ entitlements will be handed over to the independent Remuneration Authority, the Government has announced. …

* Most travel and accommodation entitlements for MPs and ministers would be set by the authority rather than Parliament’s Speaker or the minister responsible for Ministerial Services.

*MPs would be required by law to disclose their travel and accommodation expenses – they do so voluntarily at the moment.

* MPs will be docked 0.2 per cent of their salary – currently $270 a day – for non-attendance.

We’ve seen a massive change in transparency and accountability over MPs expenses in the last three years. This is another step in the right direction.

I still think that it would be very sensible to change the salary reviews from annually to tri-annually, so that the salary for an MP and Minister is set just before an election and remains in place for the three year term.

The husband of disgraced former minister Pansy Wong wrongly claimed more than $2000 of taxpayers’ money for private business trips, a watchdog has ruled.

A report ordered by Speaker Lockwood Smith last year found the couple had abused the MP’s travel perk on one occasion, in December 2008, and forced them to pay back almost $500. Wong resigned as Botany MP in December.

But, Auditor General Lyn Provost said another trip – in  June 2008  to China’s Lianyungang province – was for “private business purposes” and Sammy Wong should not have asked for a rebate.

However, Provost said her investigations found there was ”no pattern of wrong doing” by the couple “or of extensive business activity linked with overseas travel”.

Wong said she welcomed the report because it found they had not “intentionally abused the system”.

She denied her husband meant to mislead the first inquiry.

In a statement she said: “At the November 2010 inquiry, Sammy Wong contacted the company in Lianyungang, China, to ascertain the dates that he visited there. He received a list detailing trips he had made and the June 2008 trip was not on it.  None of the trips listed involved any parliamentary travel rebates. He accepted the external confirmation in good faith and had no intention to mislead any inquiry.”

Wong added: “I hope the findings of the Office of the Auditor General and my actions taken demonstrate that accountability was accepted and any mistake made was unintentional.”

While in no way condoning the claiming for two trips which were ineligible, I would note Pansy has paid a very high price for just $2,000 of wrong claims. Many other MPs were found to have inappropriately charged more than that to credit cards etc, and they got away with just paying it back.

This allows us to track spending. Now while Labour never released their spending, DIA did provide this for comparision purposes for the first six months of 2008, so we can compare that to the last six months of this Government:

• Out of Wellington accom down 40% from $78k to $46k
• Domestic Air Travel down 17% from $559k to $466k
• Domestic Surface Travel down 10% from $1,589k to $1,428k
• International Travel up 1% from $1,199k to $1,211k

Wellington accom expenses not included as impossible to compare apples with apples, as houses owned by Min Servs are not shown as an expense.

Independent MP Hone Harawira spent $43,000 on travel in three months – nearly as much as the entire Maori Party’s bill of $44,410.

I guess he’s had lots of huis to attend.

Parliament’s Speaker has moved to officially abolish politicians’ international travel perks, and will vet any travel applications by MPs to ensure they do not abuse the new system.

His new set of “directions” – the rules governing MPs’ spending and entitlements – has abolished use of the perk for private travel, from January 1. And it can no longer be used for spouses in any circumstances.

That is good, and well overdue.

MPs can still claim a rebate if their trip is primarily for parliamentary purposes – a broad-ranging definition which includes “research” and international conferences.

This is well intentioned, but is open to exploitation. If an MP wishes to go over to the UK and attend the Labour or Conservative Party conference, then they will be able to. Catch up with a couple of mates who happen to be MPs there and you have your research component.

But the vetting will ensure no one can set up a work-related meeting on holiday as justification for a rebate.

The Speaker is in charge of vetting those trips, for which MPs must pay part of the costs themselves.

This is better than no vetting, but an inferior solution to what I prefer – that the costs of any international travel be funded out of a parliamentary party’s bulk fund. This would provide a real incentive for MPs to only travel when there is real value in doing so – because there are other things you can spend the bulk fund on – more staff, external research, advertising etc.

The international travel subsidy will continue to be ring-fenced. This provides an incentive for MPs to try and maximise its use.

Independent MP Chris Carter was going to use his international travel perk for an overseas holiday but cancelled it after media found out, it was reported tonight.

Mr Carter booked flights for himself and his partner Peter Kaiser, business class to Colombo, Sri Lanka, just before Speaker Lockwood Smith last month stopped MPs from using the taxpayer subsidy for holidays, TV3 News reported.

It would have cost an estimated $13,900 – with 90 per cent paid for from the public purse.

Would have been somewhat fitting if the last use of the MP perk had been by Chris Carter.

Mr Carter is quitting politics at next year’s election, and as a former MP he will be able to use the international travel rebate for the rest of his life, without media scrutiny.

It may give him the incentive to quite before the election, so he can start using it earlier.

And Kate Chapman at Stuff also reports:

Mr Carter was not keen to discuss details of the trip when contacted last night. “We have cancelled it. We’ve lost the deposit. We’ve cancelled. We’re not going. Ok, fair enough? You guys have had yet another victory. So thanks, that’s the end of the discussion.”

Poor Chris. This transparency thing is a real burden.

Mr Carter has accused Dr Smith’s office of leaking the details of his trip.

“The leak had the date I was leaving, the hotel I was staying [at] in Singapore, the flight numbers – the only people that know that are Parliamentary Travel and the Speaker’s office, I’m quite sure that Parliamentary Travel wouldn’t have leaked it, so that only leaves one suspect,” he said. The leak was ” incredibly pathetic, vindictive and spiteful”.

Dr Smith has denied leaking the documents and said he did not even know about Mr Carter’s planned trip.

“I didn’t want to comment because I didn’t want to lend dignity to his accusation, but I didn’t even know he was going anywhere, so there was no way I could possibly have leaked anything.”

I have no idea who leaked it, but I agree unlikely to be parliamentary travel. The parliamentary travel office probably have awarded Chris the title of “Most Valued Customer” for his outstanding contributions to their sales targets.

The issues are quite complicated, so let us start from the beginning.

At some stage in the 1990s Phil Goff purchased an apartment in Wellington, and lived in it. Parliamentary Service would have paid him an accomodation allowance up to the level of the interest on his mortgage.

Then he became a Minister and got provided with a ministerial house. So he moved into the Ministerial House (which by chance was two minutes from where I live) and rented out his apartment. Nothing too out of the ordinary here.

Then Labour lost the election, and Goff lost his ministerial house. At this stage he had a choice. He could move back into his apartment, or he could rent out a new apartment at taxpayer expense and continue to rent out his apartment.

By this stage it is almost inevitable that the mortgage has been paid off. So if Goff moved back into his own apartment, he would not get a taxpayer funded accomodation allowance.

Goff has claimed he could not move back into his apartment as it had tenants. This is a red herring. S51(1)(a) of the Residential Tenancies Act 1986 states that only 42 days notice is needed to terminate a tenancy if the owner wishes to live there. With the election loss in early November, the apartment could have been free by the end of December.

But Goff chose the route which is of maximum benefit to himself. Now he is far far alone in doing so. In 2008 such arrangements were still secret as john Key and Lockwood Smith had not opened the arrangements up to public scrutiny. So I don’t judge harshly MP’s decisions in the pre-transparency era.

But then we had the transparency and Labour ripped into Bill English for his accomodation allowance use. Note that Bill English was actually found by three Speakers and the Auditor-General to be entitled to a Wellington accomodation allowance.

At that time Phil Goff was asked about his situation where he claims an accomodation allowance, and gains rental income from his property in Wellington. Goff could have defended his right to do so, but instead he pledged “The flat is currently tenanted and I plan to sell it”, as reported by TV3.

That was a very clear indication that he planned to sell it, no later than when the tenants moved out. He could incidentially have sold it at any time the tenants were there – in fact it is probably easier to sell with tenants in it. He had 18 montsh to live up to his word and sell it, and quite simply has just not bothered to do so.

You might expect such a mistake from a junior MP, but from the Leader of the Opposition it is worse. If you make a public commitment, and in a time of such scrutiny on these things, you should follow through on it.

But worse the current tenants moved out, and Goff doesn’t sell the place as promised. He advertises for new tenants. And worse he gets a member of his taxpayer funded staff to be listed as the contact person, and on four occassions show people around the apartment – during work hours.

This is a breach of the rules. That is using taxpayer resources to help Phil Goff make private money. It is in fact the exact thing they hounded Pansy Wong for.

It staggers me that the Leader of the Opposition would agree to having one of his staff be listed as the contact person for his private investment property. That is massively bad judgement. Of course Goff may not have time to do it himself – but there are specialist property managers such as Quinovic who will do it for a fee. Basically Goff chose to use a free taxpayer funded staffer, rather than pay for a professional.

Then to compound his already multiple misjudgements, he defends his renting it out as “it’s my superannuation”.

Can you think of a phrase more likely to piss off the voters? Because Phil Goff is one of those rare MP on the old gold plated parliamenary super scheme. After 30 years in Parliament he will leave with a massive superannuation payout – well into seven figures.

Then Goff blunders again on TV3. He defends his staffer working on renting out his apartment as doing it as a friend, not as a staffer and not in paid time. But this is clearly untrue – at least two of the interviews were done during the day.

I’ve worked for a political party leader, and yes they can be yogur friend as well as a boss. I’ve gone around to their place to fix their home PC (which you could argue anyway is needed for work). But when doing this, always on a Saturday.

Having a staffer find tenants for your investment property is an appalling error of judgement for the man who wants to be Prime Minister.

And in the media today, Goff carries on saying that he was entitled to do what he did, as it was within the rules. Has he learnt nothing from the last 18 months – that the public hate hearing those words “within the rules”. If he was smart, he would apologise for not keeping his word and most of all for using taxpayer funded staff to find tenants for his residential investment property.

• Travel, accommodation, attendance and communications services for members of Parliament and members of the Executive should be determined by an independent body – an enhanced Remuneration Authority which includes a former MP and a person with appropriate skills and
  experience in the administration of Parliament
• The RA should also determine entitlements to funding and services to support parties’ and members’ parliamentary operations
• The Official Information Act 1982 should be extended to cover information held
  by the Speaker in his role with ministerial responsibilities for Parliamentary
  Service and the Office of the Clerk; the Parliamentary Service; the Parliamentary
  Service Commission; and the Office of the Clerk in its departmental holdings
• The OIA should not apply to information held by members in their capacity as members of Parliament, information relating to the development of parliamentary party policies,  and party organisational material, including media advice and polling information.
• Unauthorised absences of greater than nine days should result in 0.2% of annual salary being deducted a day. That is around $250 a day, up from $10.

Overall this looks very good. I’ve long supported the OIA applying to the financial aspects of Parliamentary Service, but have not supported full inclusion, where someone like me (for example) could send in an OIA asking for all e-mails between Phil Goff and his press secretaries. No parliamentary party could operate with its internal e-mails being made available to the media and other parties.

So I think the Law Commission have done a good job on the OIA side, as their proposals hopefully stand a good chance of being adopted.

The handing over of perks, expenses and parliamentary party funding to an independent body is also an idea whose time has come. Having a former MP and someone with parliamentary administration experience on the Remuneration Authority should mean that its decisions will be made on practical experience, not textbook theory.

I hope the Government, and indeed all parties, support the report. There may be some fine-tuning to be done, but the principles look good to me.

UPDATE: Yay the PM has just announced that the Government has accepted in principle the recommendation to have MPs and Ministers expenses set by an independent body. By the end of this term of Parliament, things will be hugely more transparent and accountable compared to 2008 and before.

EMBATTLED MP Pansy Wong has been “interrogated” by officials over allegations of travel perk misuse.

The National MP and former minister is under investigation by Parliamentary Services after admitting travelling to China with her husband using a travel perk that entitled her to a 90% discount. Rules state the perk can only be used for private travel but her husband, Sammy, conducted business while there.

All of Wong’s travel, including 10 trips taken while a minister in the current administration, are under review.

Last week Wong was hauled into an “interrogation” by investigators, a source close to the inquiry said.

“Pansy was spoken to and it is expected the results will be ready within a few days,” the source said.

Good. Decisions should be made on the basis of a thorough investigation and the facts as they are revealed.

There are generally seven outcomes from MP “misbehaviour”. In rough order they are:

1. No action taken at all
2. Money is repaid, but no other action – various Ministers and former Ministers who had minor inappropriate spending
3. A formal reprimand or warning – Phil Heatley
4. A demotion but no loss of pay – Chris Carter, demoted from front bench to second bench over his perks
5. Sacking/forced resignation from a role which results in loss of pay – sacked from Cabinet, or as Deputy Speaker etc
6. Suspended or expelled from Caucus
7. Criminal charges laid

No 5 has already happened. What we don’t know is whether the facts support No 6 or No 7 occuring. No 7 will not be a decision for the Government, it will ultimately be a matter for the Police of the SFO.

No 6 will be a matter for the party caucus. It is generally used over issues of party loyalty – Chris Carter for example was not suspended over his use of perks – he was suspended for his letter to the press gallery. Even Taito Philip Field was not suspended for his corrupt behaviour – he was suspended/expelled for saying he might stand against Labour.

It is possible No 6 could happen if Caucus felt that the report is so damning that Pansy should resign immediately from Parliament. However the view might be that having a by-election in election year is a waste of money, if (for example) Pansy indicates she will be retiring at the election anyway.

It is good the report is likely to be complete soon, as that will then allow judgement and decisions to be made.

The Speaker has finally sounded the death knell on travel perks after almost 40 years of MPs enjoying taxpayer-subsidised flights for their private international trips and holidays.

Lockwood Smith announced last night that the perks giving MPs discounted international travel would no longer be available for them. …

However, he intended to set up a scheme to allow backbench and Opposition MPs to travel on parliamentary-related trips of their own initiative, rather than the limited opportunities for official travel.

He said the new scheme would have tight rules and was likely to require some personal contribution from MPs towards costs.

I still think the appropriate way to do this, is to increase the bulk funding each parliamentary party gets. Nothing will ensure only high quality trips are funded, like the fact they would be competing for funds with staff, research, policy and comms.

Any sort of dedicated fund or entitlement will end up with controversy.

The Remuneration Authority will decide if MPs will get an increase on their base salary to compensate.

They will – it is basically required by law. The real question is how much.

Former Cabinet minister Pansy Wong will be entitled to a 90 per cent international travel rebate for the rest of her life if she quits Parliament.

This isn’t quite right. The entitlements were frozen. I actually got it wrong on Twitter yesterday as I assumed they were frozen at the end of 1999, when the perk was abolished  for new MPs, but in fact it is 2008. Here is the Speakers Direction:

6.14 A person who was a member before the 1999 general election has his or her travel entitlements frozen at the level for which he or she qualified at the end of the 2005–2008 term of Parliament.

At the end of the 2008 term of Parliament, Pansy has completed four terms. And 6.15(1)(g) defines what you get:

• Less than 2 terms – 0 %
• 2 full terms and was in the Executive – 50%
• 2 full terms and not in Executive – 0%
• 3 full terms – 60%
• 4 full terms – 75%
• 5 full terms – 90%

What does this mean, then for those who are still MPs and who entered at each election. When they retire it will be:

1. 2008 – 0%
2. 2005 – 0%
3. 2002 – 0%
4. 1999 – 0%
5. 1996 – 75%
6. 1993 or before – 90%

Now who can be first to say how many MPs will get 75% when they retire, and how many will get 90%, and how many 0%?

Speaker Lockwood Smith will decide tonight whether to abolish MPs’ travel perks – but a wholesale scrapping is increasingly unlikely as some MPs argue to keep a limited discount for work trips. …

While there is broad consensus over scrapping the perks for holidays, Labour MPs at least are expected to argue in favour of retaining some funding for MPs to go on trips related to their parliamentary work, such as meeting MPs overseas or attending conferences. …

Labour leader Phil Goff has made it clear he sees the use of the rebates for holidays as unjustifiable but legitimate work-related trips were important. Opposition MPs and backbenchers are limited to official parliamentary delegations and there are few opportunities to take trips of their own initiative.

I support MPs being funded for international work related travel, but if you continue with it as an “entitlement” it will get abused, beyond doubt. If there is an entitlement  for say one “work” trip every three years, then I am sure many MPs will manage to put together a trip which will qualify for funding.

The reality is that even some “work” trips have little parliamentary aspects to them, and are mainly party political or recreational. Quite easy to visit three or four European countries to catch up with your political mates, spend a few days being wined and dined at a party conference in the UK and for good measure see the All Blacks play as you just happen to be there at the same time.

That’s at one end of the scale. At the other end you might have say the Shadow Education Spokesperson travelling to a couple of countries to meet with Education Ministers, their officials and perhaps tour around some schools being run under a new model. That is entirely legitimate and should be encouraged (again many of the best policy ideas come from overseas).

Parliamentary Service should not be placed in a position where they have to judge whether a trip has enough “work” in it to qualify for a subsidised airfare.

The answer, as I have said before, is to fund international travel out of the leader’s budget. A party leader is far better positioned to decide whether a trip is worthwhile, and they will have an incentive not to say yes to the more dubious proposals, because the more they approve for travel, the less they have for other purposes (staff, policy, research, propaganda etc).

So it is vital that any money for travel not be ring-fenced. The moment you do that, you encourage people to come up with ways to use it all. It must be part of the “bulk” fund that goes to each parliamentary party.

Now there is an argument that the current allocation of $57,000 per (non-Executive) MP isn’t designed to cover international travel, other than for the Leader. This is a fair enough point, and a consequence of abolishing the travel perk could well be to increase the level of funding to the parliamentary party to allow legitimate overseas travel to be funded.

How much should any increase be? Well my rough calculation would be that on average you would expect an MP to do a trip say every three years. The senior ones will do more, and the junior ones less. The average cost of a business class fare is $9,000 so maybe you look at increasing funding from $57,000 to $60,000 per MP per annum. You could argue one trip every five years, so that would be $1,800 extra per annum.

The one thing that should not be done is to retain a travel subsidy as an “entitlement”. That will just lead to rorting of the system. National has signalled it wants the entitlement abolished. Labour’s position is less clear. I hope they will clearly signal tat they do support abolishing any international travel entitlement, rather than just modifying the criteria for it.

No other business has an “entitlement” for international travel. If there is a good case to travel overseas, you make a proposal to your boss, and they agree to fund it out of their budget – or not. That is how Parliament should work also.

An increase to MPs’ salaries is almost inevitable if the Prime Minister’s bid to get rid of their foreign-travel perks is successful.

It is. As people now all know (and something I was the first to highlight over a year ago as it was obscurely buried in the Remuneration Authority’s 2003 determination, and had not been explicitly listed since) the value of the perk (as calculated by IRD) is deducted from their salary effectively.

If the Speaker just abolished it unilaterally, then MPs would have their base salary increase by $9,500 by the Remuneration Authority.

Although the demise of the perk seems certain, the taxpayer is likely to have to make up for it by an increase in MPs’ salaries.

Mr Key said he expected any rise to be “very modest” and putting salaries up by the full $9800 value of the perk was “unacceptable to me”. A significant increase would only expose MPs to more criticism, even though they had no say in their pay, he said.

Mr Key has urged the Speaker to ask the Remuneration Authority to decide how to abolish the perk and whether changes should be made to salaries as a result.

This is where the PM has been quite cunning. He is basically asking the Remuneration Authority to say in advance how much they would increase salaries, if the perk is abolished – with a rather unsubtle note that an increase to the full value is “unacceptable”.

So the Remuneration Authority now has to decide what to do, which is challenging as the most logical would just be to stop deducting the $9,800 from the base salary.

Annual totals for international travel perks for existing MPs:

1992-93 – $263,567
1995-96 – $387,950
2008-09 – $600,000
2009-10 – $432,989

Here’s what I would do. Divide $433,000 by 120 MPs and that is $3,500 per MP. Add that to the base salary and you can claim the exercise is revenue neutral. It’s not the principled way to do it (that would be the $9,800 option) but it is a pragmatic solution.

Labour leader Phil Goff agreed with Mr Key’s request for the perk to be reviewed independently, but said it was essential to retain some entitlement to international travel to allow MPs to go overseas on parliamentary business.

He had used his rebate for his recent trip to Australia to meet Prime Minister Julia Gillard and senior Cabinet ministers. “That enables me to do my job properly and is a legitimate use. Trying to justify the use of it for holidays will never be regarded by the public as a legitimate use.” …

Act leader Rodney Hide said he agreed with the Prime Minister that the perk should go and although it was for the Remuneration Authority to decide on salary increases in lieu of the perk, “you’d hope they’d be a wee bit judicious”.

He disputed Mr Goff’s call for some provision for work travel, saying there was already enough discretionary funding for it in party leaders’ budgets – a bulk sum they get to run their offices.

I’m actually more in agreement with Phil Goff on this point. I do think MPs should be able to travel internationally when it is work related. Many of the best policy ideas come from initiatives in other countries etc.

Now Rodney is right that such travel can be funded from the leader’s office budget. And that is where it should be funded from – rather than a separate dedicated fund. If you have a fund for travel – then people will make sure it gets fully used. If it comes from the bulk fund, then the leader (or their COS) has to decide whether the value of that travel is greater than the value they would get from spending it on more staff, or policy research, or a pamphlet etc etc.

But what I think Goff wants, and I agree with him, is a review of the level of funding for the Leader’s Office to ensure it is adequate to be able to fund legitimate work related international travel by MPs, now they can not use the perk to fund it.

BREAKING: Prime Minister tells speaker to abolish MPs perks.

Excellent. Amazing how quickly things can change in a couple of years, once you have transparency. No details yet.

MPs across the political spectrum are calling for their private travel perks to be scrapped after the resignation of Cabinet minister Pansy Wong.

Prime Minister John Key said yesterday there was “a time and a place” for looking at the travel perks.

Speaking from Japan, where he was attending the Apec summit, he said: “It’s possible there may need to be some change but today’s not the day to make those comments.

“It’s tripped up a number of MPs and that’s very unfortunate. It looks somewhat like a relic of the past but in the end that’s not solely my decision. That’s something we need to discuss [and] in due course we will.”

Raising MPs’ salary in place of the perks was contentious.

“It’s not so much getting rid of it, the question is would there be any salary adjustment.”

That sounds like a move towards scrapping it.

The issue though, is that it will mean an increase in the salaries for MPs, as the Remuneration Authority currently deducts it from the level at which it judges their remuneration should be, to set base salary.

This increase would basically be automatic – it would not be requested by MPs. You would probably have to change the law, to stop there being an increase if the travel perk is removed.

But that is what should happen. The international travel perk should go, as I have blogged previously. And MPs should get paid what the RA determines is appropriate.

A National minister used her taxpayer-funded travel perk for a trip to China with her husband where he did a business deal that later turned sour.

Ethnic Affairs Minister Pansy Wong has been under fire since it was revealed she signed herself “Minister of NZ Govt”, and her address as “Parliament Buildings, Wellington NZ”, when she witnessed a contract between Pacific Hovercraft NZ and China-based Lianyungang Supreme Hovercraft during her trip to China in January last year.

A spokesman for Prime Minister John Key confirmed last night that his office was looking into the use of Mrs Wong’s travel subsidy.

Parliament’s rules expressly forbid MPs from using their private travel perk to pursue their own or their spouse’s private business interests.

But Mrs Wong’s office insisted last night that the purpose of the trip to China was a holiday. …

There was no issue with either of them using the perk as they were on holiday, she said. While business documents were signed during the trip, “that wasn’t the aim of their holiday”.

I think the Minister may be on shaky ground here. The aim of a trip is subjective. Whether or not business was done on a trip is objective, and it seems clear there was.

Now one can argue about whether or not one business deal as part of a trip that is mainly holiday, turns it into a business trip. What if the business only took up 5% of the holiday? Or 10%?

But in reality I think that doing any business on a trip (unless utterly trivial such as signing some documents faxed to your hotel) will render the trip ineligible for use of the travel perk.

I don’t know the precise details on this issue, but my gut reaction is that the cost of the travel should be repaid if business was done on the trip. The intent is not what counts – it is what happened on the trip.

UPDATE: The above was written at 9 am and set to appear at 1 pm. The media are now reporting she has been stood down.

The editorial is on transparency over the MPs travel perks. Now my position is actually the same as the Dom Post’s – that the perk should be abolished. But the editorial goes too far when it says:

Dr Smith argues that the subsidy, which cost $432,989 last year, is actually paid for by MPs collectively forgoing part of their salary entitlement.

It is an argument that bears a passing acquaintance with the facts. The Remuneration Authority takes account of the cost of the subsidy when setting MPs’ pay.

That is not a passing acquaintance with the facts. It is 100% correct, even if the Dom Post does not like it.

The travel subsidy, like many other MPs’ perks, was initially introduced in lieu of a pay rise. However, when responsibility for setting MPs’ pay was transferred from Parliament to the Remuneration Authority’s predecessor, the Higher Salaries Commission, it ignored many of the entitlements MPs had voted themselves.

It did – up until 2003. In 2003 the Remuneration Authority moved to a total remuneration calculation where it calculates what should be the total remuneration for an MP, and deducts off the super subsidy and the travel perks.

Hence MPs receive what an independent body thinks their jobs are worth plus the value of the extras they have voted themselves over the years

No this is absolutely wrong. The independent body works out what their jobs are worth and deducts the value of the extras off the remuneration to calculate a base salary.

extras that inflate the base salary of today’s MPs from $131,000 to more than $180,000.

Not quite. The Herald calculates it as:

• Salary $131,000
• Super Subsidy $26,200
• Domestic Travel $1,176
• Partner Travel $3,449
• International Travel $9,646

That is around $170,000 as the value of an MPs remuneration package.

That gives even the meanest MP an income higher than 99 per cent of his fellow citizens. Whether it is too much is a matter of judgment, but it is not a matter of judgment that should be exercised by those who stand to benefit from it.

Eight years ago Parliament was advised to set up an independent body to determine MPs’ pay and entitlements, but when the legislation reached Parliament’s standing orders committee – a body every bit as powerful and self-interested as any trade union – it was gutted.

The ongoing furore over MPs’ travel expenses is the price MPs pay for refusing to surrender control of their pay and perks. It is a price successive Speakers have been happy to pay, but it is not one the public should tolerate.

MPs’ pay and perks should be set by an independent body that takes account of comparable pay rates here and overseas, the state of the economy and workloads.

I agree they should all be set by the Remuneration Authority, but I don’t think it would reduce the “furore” over pay and perks.

Now in this article we read:

Members of Parliament are secretly planning to change the rules around their $24,000-a-year accommodation allowance to make it easier for those who make Wellington their home to still be counted as out-of-towners.

Under the new rules, MPs will be able to nominate a “home base” where they normally live when not doing parliamentary business in Wellington. If that is outside Wellington, they will qualify for the accommodation allowance.

I have not got a copy of the new rules, but from what I can glean the change is around wording, not substance. The old rules referred to primary residence and the new rules refer to a “home base”. The Auditor-general herself said the term “primary residence” was not a useful one as the test has never been where an MP spends most of their time. If that was the test, then no Minister would ever be found to live outside Wellington.

One has to approach this from a principled approach, in relation to the fact the job of an MP requires them to live in Wellington some of the time, and when in Wellington they need to be have a place to live. The principle is that an MP should not be out of pocket for what is a work related expense, but neither should they gain from it.

If an MP, before they became an MP, resided outside of Wellington then their Wellington accommodation expenses get met (up to a limit) by the taxpayer. The exception to this is if the MP abandons their out of Wellington residence – either by selling it or renting it out. If they do that, then they are gaining at taxpayer expense.

The Auditor-General ruled (as did Speakers Hunt and Wilson) that Bill English was entitled to a Wellington accommodation allowance because he still maintained his Dipton property. If he had sold it or was leasing it out, then they would have found differently.

The one change I would make is I would bar MPs from having a direct or indirect interest in the Wellington accommodation they claim the allowance for. The Greens had their super scheme own several as a way to maximise income for themselves – and in fact were even claiming twice for the same property. Other MPs have owned the places they rented.

So the change in the rules is fine – the only potential for abuse is:

But one MP agreed yesterday that under the new definition it might be possible for an MP to maintain a small empty apartment out of Wellington and nominate it as a “home base”, when it would not have fitted within the definition of a primary residence as most people understood it.

In theory yes it is possible an Minister could move their family to Wellington, and sell their five bedroom house in the electorate and designate a small apartment as their home base. But there is always a way for venal people to rort the rules – and if any tried to do that, I would hope the media will expose that.

You could try and have a rule that an MP does not downgrade their home residence while they are an MP, but frankly it is unworkable – what if their kids move out of home etc.

So no problems with the change, but I do think it would be desirable to do a further change – to ban MPs from claiming the allowance for a property they have a direct or indirect interest in.

Now Lockwood has identified the problem correctly, but in this rare instance I disagree with his solution.

It is unfair to be deducting the value of the perk from the salary, and to be having witch hunts against those who use it. But the solution is to abolish the travel perk and increase the salary – not to try and keep the details secret.

Lockwood and the PM have opened up the books greatly, and doing so is a one way street effectively. Even if the Parliamentary Service only now publish the total amount of travel perks used, the media will question each individual MP about whether they have used it, and so the end result will be the same.

The Herald quotes Rodney Hide saying much the same:

“Why don’t you just pay the MPs, don’t allow the rebate and cover their legitimate expenses?”

While the Green Party is looking at releasing their rebate details anyway, Hide could not speak on behalf of all his MPs on whether they would follow suit.

“I don’t think the speaker can put the genie back into the bottle, because people quite naturally expect transparency and accountability and it would be impossible to explain, in this day and age, that this rebate is being paid out of an MP’s salary, even though it is.”

I agree with Rodney that this is what should happen. There has been an argument that the travel perk should stay, because it is the only way to recognise more experienced MPs service. But I would say that if we wish to do that, then do it directly through salaries. There is no reason the Remuneration Authority can’t be asked to set a slightly higher salary for MPs who have served a certain number of years. some may argue against this also – my point is one should set the salary to cover all remuneration, and then just have legitimate expenses claimed.

Some MPs do use their travel perk for a mixture of work and play – such as travelling to meet colleagues in other countries. But that can be funded from the Leader’s Budget. If the argument is their budgets are not big enough to cover that, then lets debate that, rather than keep the travel perk which will never be accepted by the public – inevitably it will go the same way as the perk for ex MPs.