Explanatory memorandum
This memorandum is not part of the determination, but is intended to indicate its general effect.
This determination comes into force on 24 September 2017.
Section 17 of the Members of Parliament (Remuneration and Services) Act 2013 (the Act) requires the Remuneration Authority (the Authority) to determine the accommodation services within New Zealand for members of Parliament and the travel services within New Zealand for members’ family members.
The Act requires the Authority, in making its determination, to have regard to a number of factors, including fairness to the taxpayer and independence of approach.
Starting points
The starting points for the Authority in making this determination have not changed from those of the previous determination. They are that—
members and ministers should not personally have to meet the expenses, such as accommodation, that they require to enable them to do their job; and
any personal benefit to members and ministers should be kept to a minimum.
Members and ministers are generally recognised as having 2 places of work, namely,—
Wellington, where they attend Parliament and, in the case of ministers, where they also attend Cabinet; and
their home base, where they attend to a wide range of matters affecting constituents.
Therefore, it is appropriate that the costs of their accommodation in Wellington, if that is not their home base (with the exception of the Prime Minister), should be a public expense.
As Premier House—Te Whare Pirimia—is the recognised official residence of the Prime Minister, it is our view that the Prime Minister should be able to reside in Premier House even if the Prime Minister’s home base is in Wellington. There is a high degree of symbolism in and solid practical reasons for having an official residence for the head of the government. It is also a more cost-effective option than other alternatives.
As part of their work, members undertake a significant amount of travel, both within their electorates and around the country. This is also the case with list members. List members customarily have bases in electorates as well as responsibilities for nation-wide communities of interest. All members routinely attend evening and weekend meetings, and other events. They must be constantly available to constituents, the general public, and the media in a way not required of most other groups. The pressures on ministers and the Prime Minister are especially demanding. As a consequence, members and ministers have much less of a family life than what other New Zealanders take for granted, often over a long period of years. Therefore, we have continued to provide for some limited family-friendly measures designed to recognise that reality.
The Act gives the Authority responsibility for only some of the services required by members and ministers. Travel services, office space, communications, and other support for members remain the responsibility of the Speaker. Travel services for ministers remain the responsibility of the Minister Responsible for Ministerial Services. Within the constraints of that framework, we have continued the approach that treats members and ministers similarly. For example, both members and ministers are entitled to an annual accommodation payment. As well, certain services for the Prime Minister, the Speaker, the Deputy Speaker, and the Leader of the Opposition are generally aligned with those for ministers, and certain provisions for qualifying electoral candidates with those for members, while allowing some differences to recognise their unique roles.
Process followed
The Act prescribes the process to be followed in making a determination. The Authority engaged with members on preparing this determination; we sought the advice of the Minister Responsible for Ministerial Services and the Speaker, and had the benefit of receiving the views of a cross-party committee established by the Parliamentary Service Commission.
We sought the views of the Parliamentary Service and the Department of Internal Affairs—Ministerial Services, given their responsibilities for the administration of the services provided for in this determination. Nationwide and regional market data provided by industry and government sources informed the setting of the accommodation rates.
We consulted the Commissioner of Inland Revenue about the taxation consequences of the determination. Consequently, we have assessed that there has been no change in the value of any personal benefit or potential personal benefit from what had been assessed for the 2014 determination and the amendments to that determination.
As required by the Act, we provided members and ministers with the opportunity to comment on the determination in draft form. After considering feedback, we finalised the determination in September 2017.
Changes from previous determination
The main changes that have been made by the Authority in the 2017 determination are set out below.
Definition of parliamentary business
This determination uses substantially the same definition of parliamentary business as in the Directions by the Speaker of the House of Representatives 2017. This is to ensure consistency, to aid efficiency and effectiveness in delivery of services, and to simplify administration.
Administration
The clause describing the administration of this determination has been revised to clarify that the administrative responsibility for members, other than ministers, and their families sits with the Parliamentary Service, and the administrative responsibility for ministers and their families sits with the Department of Internal Affairs—Ministerial Services.
Accommodation services
The accommodation rates have been updated to reflect the realities of both the current rental housing market in Wellington and hotel rates nationwide. The determination has been amended to ensure the consistency of the accommodation services provided, including—
harmonising the eligibility criteria applied in meeting the costs for continuous accommodation and non-continuous accommodation for ministers and members who are not ministers; and
increasing the scope of what is claimable for meeting the costs of non-continuous accommodation; and
enabling the cap applied to non-Wellington accommodation in certain circumstances to be applied to Wellington non-continuous accommodation.
Travel services for family members
This determination reinstates the following services that were previously available to the spouse or partner of a member before 2014:
the spouse or partner of a member of Parliament can use a taxi for local travel to accompany or join the member at a function or an engagement related to the member’s parliamentary business; and
the spouse or partner of a member who ceases to hold office will be entitled to 1 return trip to Wellington to assist the member to attend to matters associated with leaving Parliament.
Separate determination
Other matters
A key principle (section 16(1)(c)) of the Act states that if changes to services provided increase or decrease any element of remuneration or other private benefit, the value of that increase or decrease should be taken into account by the Remuneration Authority in determining members’ and ministers’ salaries. We will do this in our Parliamentary Salaries and Allowances Determination.
Section 32(1) of the Act requires that once in each term of Parliament the Authority should make a determination on accommodation services for members and ministers, and travel services for their families. Therefore, this determination commences on 24 September 2017 (ie, the day after election day) and will endure through to the end of the parliamentary term. However, should the need arise, amendments to address specific issues may be issued during the period of this determination.