KEY POINTS:
Labour leader Phil Goff is calling for a law change to allow the Remuneration Authority to freeze MPs' pay but the Government says that step is unnecessary and has asked the authority to act.
The independent Remuneration Authority determines pay rises for MPs, the judiciary and specified statutory officers and members of local authorities and community boards.
Mr Key wrote to the authority asking it to freeze MPs' pay at its next review and exercise restraint when considering all salary rises in its jurisdiction, due to the tough economic times.
The National Party would also file a submission with the authority calling for a zero pay increase in parliamentary salaries.
"It is only right that in these changing economic times, as ordinary New Zealanders tighten their belts, MPs and ministers also play their part," Mr Key said.
Mr Goff said it was critical that the authority took into account the position of "ordinary" New Zealanders and the economy but it needed the power to do so.
"It would be totally inappropriate for a decision to be made by the Remuneration Authority where people on higher salaries were treated differently from the position of ordinary New Zealanders," he told reporters.
Mr Goff said neither a press statement nor submission to the authority would make any difference.
That was an "empty instruction" with "no impact" as the authority could not take into account what the political leadership said.
Authority chairman David Oughton had indicated previously a law change was the way to go, Mr Goff said.
Mr Key's letter related to future rises as two months ago MPs were given rises of between 3.8 and 4.8 per cent. Judges were granted a 4.8 per cent rise a month later.
Mr Goff said there was about 11 months to change the legislation requiring the authority to take into account broader economic circumstances and Labour would support that.
At present the authority takes into account public and private sector pay rises, along with those of the judiciary.
A spokeswoman for Mr Key said the authority could consider submissions.
"It is our opinion that the law not only allows the authority to consider our letter but to act on it," she said.
"We hope they do."
The Government would consider a law change if Mr Key's request was not responded to.
ACT leader Rodney Hide supported Mr Key's call and said his party also recommended zero increases in MPs' pay.
Mr Goff said the private sector's executives and managers should also face the same constraint.
"I think it's something the whole country needs to act together in a way that I think President Obama appealed to in his speech yesterday."
United States President Barack Obama announced top White House staff pay would be frozen.
Mr Goff assumed Mr Key had been frugal in new appointments.
- NZPA
