Possible change to Ministerial Accom

The Herald reports:

Government ministers collecting rent from their private Wellington properties may be required to offset the cost of their taxpayer-funded official ministerial residences.

My position has always been that ideally the rules should not allow the MP (or Minister) to directly or indirectly (such as through a super fund) own the home for which they get taxpayer funding, as the whole point of the subsidy is to meet expenses you would normally not incur.

This proposal would take things one step further, and mean if you own any accommodation in Wellington, then any income from that gets deducted from your maximum allowance for the place the MP stays at.

This is superficially attractive, but all it might do is mean MPs own properties in Auckland and Christchurch instead of Wellington. For example Helen Clark had an investment property in Wellington. I think it would have been bizarre to force her to hand over the income from that property to the Crown to offset the cost of Premier House, yet if the property was in Christchurch say there is no issue.

At least seven ministers who own Wellington properties from their time in Opposition have shifted into flasher homes, and most rent out their properties.

For some this is because they now have their families shifting to Wellington to live with them, as MPs are in Wellington only three days a week, 30 weeks a year and Ministers are in Wellington five days a week, 46 weeks a year.

In ordering the review by Ministerial Services, Mr Key – in damage-control mode – defended his ministers but acknowledged the public concern.

He said there could be “a very strong argument” for lowering the ministerial accommodation allowance if there was a pecuniary benefit to ministers.

As I said, I would just focus on not allowing direct or indirect ownership of the property having the rent paid. In other words avoid the situation where the MP’s own house is being rented to them. This won’t necessarily save any money, but it will remove any incentives to maximise expenses. Note I have said previously that I do not think that was Bill’s incentive – for him he just did not want to move the family again.

Yesterday, at his post-Cabinet press conference, Mr Key went into bat for his ministers, saying their housing needs in Wellington were different from those of backbench MPs.

An MP stayed in Wellington two nights a week for about 32 weeks a year. A minister stayed about four nights week, 46 weeks of the year and worked up to 18 hours a day – and they had families.

Heh – the argument I made on Sunday and which had not been reported elsewhere!

The funniest quote is:

Foreign Minister Murray McCully owns Wellington property but lives in a ministerial residence.

“He is determined that he wants to entertain in the new property, and that is quite legitimate,” the PM said. “Quite frankly, he is out or entertaining pretty much every night he is in New Zealand.”

This is very true, but such practice predates Murray’s appointment as Foreign Minister by around 21 years 🙂