Loophole exposed in the Herald allowed politicians to hold undeclared real estate

A loophole allowing MPs to hold millions of dollars worth of undisclosed real estate investments and other assets without declaring them has now been closed. It was exposed in the Herald last year.

The investigation, in conjunction with data journalist Keith Ng, revealed substantial real estate investments owned by MPs through about 40 private superannuation schemes.

Some were also paying off mortgages of up to $78,000 a year on those properties through their taxpayer-funded superannuation contributions and accommodation allowances.

Parliament's standing orders - the rule book for MPs - obliged them to declare in the Register of Pecuniary Interests any property they held in trusts, but not property held in superannuation schemes.

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However, the standing orders have now been reviewed in time for the incoming government.

In line with a recommendation from the Registrar of Pecuniary Interests, Sir Maarten Wevers, assets in large-scale public superannuation schemes still won't have to be declared but property held in trusts set up as private super schemes will.

The Herald understands its coverage of the issue was a factor in MPs on Parliament's standing orders committee deciding to accept the recommendation.

National MP Chester Borrows told the Herald: "We've entered a new era of transparency and everyone expects to know everything as far as politicians go.

"They certainly wouldn't want every detail of their employment contracts and what their fringe benefits were if it was applied to the private sector or to the wider public sector but I have just resigned myself to the fact that this is the new environment that we're working in and I've got nothing to hide."

Mr Borrows said he didn't care about the new requirement, "but you just get a little bit frustrated that the public probably wouldn't be happy unless politicians got paid $20 an hour and lived in a dormitory".

The rules have also been tweaked to require MPs to declare any accommodation or travel paid for by a foreign government. That clears up ambiguity exposed when former Justice Minister Judith Collins chose not to disclose details of her trip to China a year ago when she visited milk company Oravida's Shanghai offices and dined with the company's bosses.

Q & A: MPs' undisclosed real estate investments

What were the investments?

Properties owned by MPs through private superannuation schemes.

How were these investments revealed?
Data journalist Keith Ng compared millions of property and ratepayer records against MPs' declarations in the Register of Pecuniary Interests.

What did he find?
That about 40 MPs - 35 of them from National - owned undisclosed property investments through private super schemes. National's Chester Borrows, Simon Bridges, Anne Tolley, Chris Auchinvole, Peseta Sam Lotu-Iiga and Mike Sabin were also using their accommodation allowances to help pay mortgages on such properties.

What has happened now?
Parliament's standing orders committee has changed the rules so assets held in MPs' private super schemes now have to be declared.