Prime Minister Christopher Luxon will no longer claim a $52,000 accommodation allowance for living in the Wellington apartment he owns.
Video / Newstalk ZB
Opinion by Claire Trevett
Claire Trevett is the New Zealand Herald’s Political Editor, based at Parliament in Wellington.
Within 12 hours of news he was claimingthe allowance - and less than two hours after defending himself to the hilt for it - Luxon clearly asked himself the question he should have started with: “What would Sir John Key have done?”
Luxon then announced he would not be taking the allowance after all and would repay the $13,000 he’d received since becoming PM.
He will doubtless be feeling a bit peeved about it, but it was never politically defensible. Prime Ministers deciding whether to take entitlements should always do a tally: will the grief I get for this be worth the amount involved? It rarely is.
From where he sat, he had decided he could not live in Premier House until maintenance work was done on it. So, he reasoned, it was all good to stay in his Wellington apartment and continue to claim an accommodation allowance from the taxpayer, just as he had when he was a normal MP and not the Prime Minister.
That might be defensible if he was not a Prime Minister who was also a self-proclaimed defender of the taxpayers’ dollar, nipping and tucking away at spending in every other corner of government.
Prime Ministers are expected to live in Premier House - but they can choose to live elsewhere, in which case they can also choose to claim an allowance of up to $52,000 a year (the allowance for a backbench MP is $36,400).
The rules around those entitlements state a Prime Minister “may elect” to get the payment. Luxon is the first Prime Minister in more than 30 years to make that choice.
There is a reason for that.
The “may elect” should be taken by any Prime Minister as a flashing red light.
It effectively states that if you decide not to live in Premier House and to take this allowance, that way lies dragons – the dragons known as Double Standards and Hypocrisy.
It might not seem fair, but politics isn’t. When you’re a Prime Minister cutting costs and jobs across the public sector, and repeatedly railing about “taxpayers being treated like a bottomless ATM, to be raided at any time, for any reason” you don’t leave yourself with many choices.
Only this week Luxon pointed to the same double standards issue when he was addressing what was needed to do up Premier House:
“It obviously needs investment. How we can manage that in the times we’ve got and the cost of living crisis is difficult.”
What he meant by that was that it was difficult to justify politically, which makes his decision to claim that allowance all the more baffling.
In terms of the double standards tally, this had also coincided with government departments pruning their budgets and staff numbers under National’s cost-cutting drive.
Premier House in Wellington. Photo / Mark Mitchell
Ministerial Services’ own briefing to Luxon referred to the expected 6.5 per cent cuts and warned that ministerial entitlements may have to be trimmed to achieve it.
In recent weeks National changed the way benefits would be adjusted to be in line with inflation rather than wages, meaning future increases in welfare are set to be much smaller than they would be.
Luxon was indeed entitled to the allowance – but just because an entitlement is there doesn’t mean you have to take it.
That is particularly the case when Premier House was good enough for Jacinda Ardern to live in with a young child, and for Sir John Key to put up with prior to that. If Key did stay elsewhere in Wellington, such as at a hotel, he never claimed for it.
Both Ardern and Key had some woeful tales about the state of Premier House, but they both also recognised that politics demanded they lived in the place without too much fuss.
A focus on MPs’ spending can sometimes verge on nitpicking. Key took the whole thing of Prime Ministers paying their own way a bit too far – he would pay for his wife Bronagh to travel with him on official trips for example.
Premier House is not an attractive option from the accounts of its inhabitants – and to a degree Luxon is now paying the cost of his predecessors not wanting to look like hypocrites.
Spending on a PM’s “perks” is an easy target and so through successive Prime Ministers, Premier House has either been left to fall into further disrepair because they were wary of a backlash, or there have been renovations and their political rivals have piled in on it.
This time round, it’s understood Labour leader Chris Hipkins has gone to Luxon and told him he would be willing to present a united front on reasonable expenses involved in getting it up to scratch.
Luxon said yesterday that the options were now doing it up or selling it. He had adduced the public would not want to sell, so instead they will have to put up with the cost of doing it up.
The independent consultants’ report into Premier House would tell us just how bad it was, and allow us to assess whether Luxon was justified in his decisions.
The NZ Herald has previously requested that report, but it was denied because Luxon was yet to make decisions about how much of it to proceed with.
Some of the allowances for MPs and ministers are appropriate, including the accommodation allowance for those who live outside Wellington but have to be in the capital for Parliament.
They should not be expected to have to pay for houses in two places.
However, the taxpayer should also not have to pay for the Prime Minister to effectively have two places in one city.
Taking the allowance has marred what has been an otherwise good beginning by Luxon as PM.
He has become increasingly sure-footed and deft in his weekly post-Cabinet press conferences, knowing which issues to skirt around and usually on top of his brief.
He has learned early that if he doesn’t know the answer, he should simply say that rather than try and bluff his way through.
He’s also mastering the art of punching back at his opponents – as the outcry rages while National repeals and scraps Labour’s major reforms, Luxon has simply pointed to the election result and noted it won the election on a platform of doing what it was now doing.
Quite why he’d wanted to spoil that for the sake of taking an allowance to live in an apartment he owns which is mortgage-free is puzzling.
Luxon may well deem it fair he takes the entitlement, given if it wasn’t for his job he wouldn’t need the apartment at all or he could rent it out for a large sum.
That’s the business case for it – the politics case is totally different.
