Dated at Wellington this 26th day of July 2011.
A Foulkes,
Deputy Chairperson.
D Morcom,
Member.
Explanatory memorandum
This memorandum is not part of the determination, but is intended to indicate its general effect.
This determination sets a new rate for the salary of the Governor-General. A new rate is required because the salary of the Governor-General who is to take up office on 31 August 2011 is set under the new Governor-General Act 2010. That Act provides for the salary of the Governor-General to be set on the basis that it is not exempt from income tax, and makes certain changes to the allowance of the Governor-General, and the funding of the Governor-General's programme, which are relevant to the setting of salary. The salary of previous Governors-General was set under the Civil List Act 1979, which provided for the salary to be set on the basis that it was exempt from income tax, and provided a tax-free allowance which covered both official programme expenses and the Governor-General's expenses.
In making the current determination the Authority has sought, in the interests of fairness to all holders of the office of Governor-General, to ensure that the remuneration of the Governor-General Designate is as close as possible to the current remuneration of the incumbent Governor-General.
Recent determinations of the Governor-General's salary under the Civil List Act 1979 have taken as their starting point the establishment of a notional gross salary, converted into a tax-free salary by applying the relevant personal income tax rates and threshold levels. That approach has had the effect of placing the Governor-General's salary on the same basis as that of any salaried person who benefits from adjustments in taxation rates and thresholds.
The most recent determination under the Civil List Act 1979, set out in the Civil List Determination 2011, provides the basis for the current determination. That determination sets the salary of the Governor-General at $210,309, on the basis that it is exempt from income tax. The Authority has converted that sum into a gross figure, and has made an adjustment to reflect changes in the structure of the Governor-General's allowance and to reflect the fact that there is an 18-month period between the determination set for the incumbent Governor-General on 1 April 2011 and the expiry of this determination on 31 October 2012. The new, taxable, salary is $311,000.
In accordance with section 5(3) of the Governor-General Act 2010, the appointee and the Prime Minister have agreed that the starting date for payment of the salary will be 1 August 2011. This determination accordingly takes effect on that day.
This determination also revokes the Civil List Determination 2011 with effect from the close of 23 August 2011, when the term of office of the incumbent Governor-General ends.