Ministers may be asked to cough up for official homes

John Key says rent from ministers' private properties could offset the cost of state-provided residences. Photo / Mark Mitchell

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

Prime Minister John Key has hinted that that could be the outcome of a review he ordered yesterday following new disclosures on the spending of the nation's politicians.

Ministers are maximising taxpayer subsidies by getting official accommodation as well as renting out the flats they used to live in as ordinary MPs.

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

At the same time as collecting rent - and getting free housing - their salaries have gone up by at least $99,000 from a backbencher's basic pay of $144,500 to a basic ministerial salary of $243,700.

Ordinary MPs can claim actual accommodation expenses in Wellington up to a maximum $24,000 a year, but under a different set of rules the cost of ministerial housing is about twice that.

Labour Party chief whip Darren Hughes said today there appeared to have been a change of rules since the election.

"But it seems now if ministers stay in their own homes they can claim a lot more than that," he told Radio New Zealand.

He said the change appeared to be that the allowance was higher for ministers than for MPs, if they stayed in their own homes.

Mr Hughes stopped short of suggesting some ministers may be making claims over and above what they are entitled to.

"But we are welcoming the review to make sure that is correct, because there does appear to have been a change in the way some of these rules are applying from, for example, when we were the government."

Mr Hughes said the issue was something MPs tended to avoid confrontation on, considering families were involved.

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.

"The outcome here is to make sure the taxpayer gets as fair a deal as possible and that [the rules] genuinely reflect their actual demand and time here."

The practice of renting out private homes and taking up ministerial accommodation has been going on for years and is within the rules.

But calls by the Government - and Finance Minister Bill English in particular - for people to show restraint in light of the recession have put the spotlight on the arrangements.

The costs have only just been revealed thanks to a move to greater transparency in MPs' spending.

Mr English himself is in a category of his own. The taxpayer foots a bill of $900 a week for him and his family to stay in the Wellington home they have lived in for two years.

Wellington-based MPs are not eligible for any subsidy but Mr English is classed as an out-of-town member because he represents Clutha-Southland electorate and has a home in Dipton.

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.

"I want those families to stay together. We can go out there and persecute Cabinet ministers but, I'm sorry, they are actually doing a very important function ... and I expect them to be able to keep their marriages and their families intact.

"I don't expect them to take advantage of the goodwill of the New Zealand taxpayer and I don't believe they are, but I am quite happy to have new rules out there that reflect that."

But Mr Key said the present rules were responsible for some "perverse outcomes". Ministers who stay in their own dwellings can receive only the maximum that an ordinary MP receives - $24,000. David Carter and Pita Sharples are in that category.

Maurice Williamson is continuing to live in the flat he rented as a backbencher.

Mr Key defended the circumstances of several ministers, including Phil Heatley (Housing), who owns a two-bedroom flat that he rents out but has taken a three-bedroom ministerial flat and moved his wife and three young children to Wellington.

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."

Mr Key's department will draw up the terms of reference for the Ministerial Services review.

* Housing assistance

John Key: Lives in ministerial home. Also owns Wellington apartment - gets no income from it.

Bill English: Ministerial Services paid $23,673 for accommodation from January to June. Went towards his own home in Karori.

Gerry Brownlee: Ministerial home. No Wellington property of his own.

Simon Power: Ministerial home. No Wellington property of his own.

Tony Ryall: Ministerial home. No Wellington property of his own.

Nick Smith: Ministerial home. No Wellington property of his own.

Judith Collins: Ministerial Services paid $23,040 for January-June. Did not respond to Herald about whether she owns other property.

Anne Tolley: Ministerial Services paid $22,045 January-June. Also owns $295,000 one-bedroom apartment, which is currently rented out.

Murray McCully: Ministerial Services paid $12,865 January-June. Owns a flat and rents it out.

Tim Groser: Ministerial Services paid $8937 January-June. Also owns $540,000 apartment in central Wellington, which is being used as an investment property.

Wayne Mapp: Ministerial Services paid $18,878 January-June. Also owns $285,000 apartment and rents it out.

Steven Joyce: Ministerial home, no Wellington property of his own.

Georgina te Heuheu: Ministerial Services paid $7966 January-June. No Wellington property of her own.

Paula Bennett: Ministerial Services paid $21,661 January-June. No Wellington property of her own.

Phil Heatley: Ministerial Services paid $24,607 January-June. Also owns $360,000 apartment that is being rented out.

Pansy Wong: Ministerial Services paid $17,568 for accommodation January-June. No Wellington property.

Jonathan Coleman: Ministerial Services paid $12,399 January-June. No Wellington property.

Kate Wilkinson: Ministerial Services paid $18,059 January-June. No Wellington property.

John Carter: Ministerial Services paid $15,772 January-June. No Wellington property.

Rodney Hide: Ministerial Services paid $19,029 January-June. No Wellington property.

Tariana Turia: Ministerial home. Also own $520,000 property in Wellington suburb of Broadmeadows. Refuses to say if she rents it out.

* Ministers apart

Maurice Williamson, David Carter and Pita Sharples are ministers from outside Wellington but have declined official residences and continue to live in the apartments they had as backbenchers. The amount they claim is limited to $24,000 a year, about half of the more expensive ministerial costs.

Chris Finlayson, Peter Dunne and Heather Roy are Wellington-based MPs and are not eligible for an official ministerial residence.

- With NZPA