Adam Bennett

Adam is a political reporter for the New Zealand Herald.

Ministers' salary bump outstrips most voters'

$5000 lump sum to offset loss of travel perks takes backbench MPs' pay increase to 5 per cent

The Remuneration Authority decided to pay all MPs a lump sum of $5000 to make up for the loss of the travel perk. Photo / Kenny Rodger
The Remuneration Authority decided to pay all MPs a lump sum of $5000 to make up for the loss of the travel perk. Photo / Kenny Rodger

Backbench MPs' pay is climbing faster than the average wage as a modest increase to their basic salary is boosted by a $5000 lump sum to offset the loss of their travel perks.

The Remuneration Authority, an independent body which sets pay for MPs and judges, this week released its latest annual pay review for parliamentarians.

"Taking into account the prevailing adverse economic conditions, the authority has decided to apply a general increase this year of 1.5 per cent," it said.

However, the authority also decided to pay all MPs a lump sum of $5000 to make up for the loss of the travel perk, which was axed after MPs including Act's Sir Roger Douglas and Rodney Hide and Labour's Chris Carter made heavy use of it.

The authority's determination means a backbench MP's basic pay rises $7000 or 5 per cent to $141,800, with the increase backdated to July this year.

Meanwhile, in the year to June this year the average wage, according to the quarterly employment survey, rose 4 per cent to $51,100.

Prime Minister John Key, who got an $11,000 pay increase, said that while the 1.5 per cent boost was fair, the lump-sum payment for travel was unnecessary and he was disappointed the Remuneration Authority had awarded it.

Labour leader Phil Goff, whose pay rose by $8700, said his MPs could use the money, but those like himself on high salaries would pay more in tax if Labour won the election.

Mana Party leader Hone Harawira said the pay increase left him feeling "sick in the stomach".

"To accept this pay rise at a time when the poor of New Zealand are in financial strife as a result of the Government's 'take from the poor for the rich' policies is a real kick in the guts for those who are struggling."

Mr Harawira said he would donate his $7200 increase to "one of the many voluntary organisations in my electorate of Te Tai Tokerau trying to help the poor the Government has deserted and I call on all politicians to make a similar gesture".

Meanwhile, the tax-free allowance intended to cover costs including entertaining visitors, donations, gifts and prizes rose 5.3 per cent to $16,100 for most MPs.

UP AND UP

* Prime Minister: $400,500 to $411,510

* Deputy Prime Minister: $282,500 to $291,800

* Crown ministers, the Speaker, the Leader of the Opposition:$249,100 to $257,800

* Party leaders' base salary: $148,500 to $155,700

* Backbench MPs: $134,800 to $141,800

* Average New Zealand wage: $49,036 to $51,116

- NZ Herald

© Copyright 2014, APN New Zealand Limited

Assembled by: (static) on production bpcf05 at 21 Dec 2014 23:58:30 Processing Time: 502ms