New Ministerial Housing Rules

The Herald reports on the new simplified rules for Ministerial Housing.

The review looked at four options, being:

  1. The status quo
  2. Treat Ministers no different to MPs. Rejected as this does not recognise the extra time they spend in Wellington, and probability some of theri family may live down here also while Ministers.
  3. Use same expense reimbursement regime as for MPs, but lift cap from $24,000 to $48,295 (around $930 a week) being the assessed market value of suitable accommodation.
  4. An accommodation payment of a set level, being $37,500 ($720) a week. This is regardless of actual expenses incurred, but is set for less than the market estimate by around 25%. This is the option selected.

With option (4) the payment reduces to $30,000, if a Minister stays in the same house as they had as a backbench MP. This is equal to around $575 a week.

Option 4 overall reduces the cost to the taxpayer of the accommodation services provided. It will probably also lead to a staffing reduction in DIA, as the Department will expire the leases on the 14 leased properties and sell every property they own except Premier House.

Vogel House and the Bolton Street house were gifted with conditions, so will be interesting to see how they will be dealt with. Personally I would be sorry to see Vogel House go as it has significant history.

The total annual cost is $2.37 million. The cost of the payments in future will be around $900,000 based on 20 x $37,500, 5 x $30,000 and 3 x $0. There seem to be $500,000 of other costs (mainly Premier House) on top of that but overall it is estimated costs will drop to $1.48m. That is a 38% cost saving. If you exclude Premier House, then the costs are dropping 45%.

The PSA should be very very worried about the next pay round!

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