Key Takeaways
- Prime Minister Christopher Luxon defends the current MP accommodation allowance, saying it is set by an independent remuneration authority and should not be altered by politicians.
- Housing Minister Chris Bishop acknowledges MPs are well paid but stresses that the allowance is unrelated to his personal situation because he lives in Wellington.
- Labour leader Chris Hipkins argues that claiming an accommodation supplement while not spending it on housing is hard to justify and hints that Labour may campaign on reducing MP perks.
- Minister Louise Upston’s $1,000‑a‑week allowance for her own Wellington apartment has sparked criticism, especially after she raised the threshold for homeowners to receive the general accommodation supplement.
- The allowance rules permit MPs who are not based in Wellington to claim up to $52,000 a year (ministers) or just over $36,000 (regular MPs) for any type of accommodation, including renting their own homes back to themselves.
- Recent legislation raises the income‑to‑housing‑cost threshold for the general accommodation supplement from 30 % to 40 %, reflecting the coalition’s focus on fiscal sustainability while the MP allowance debate continues.
Overview of the MPs’ Accommodation Allowance Controversy
The debate over parliamentary perks resurfaced when Stuff highlighted that Minister Louise Upston receives a $1,000‑weekly accommodation allowance to live in her own Wellington apartment, despite having recently voted to raise the eligibility threshold for the general accommodation supplement that assists ordinary homeowners. Critics argue that this creates a double standard: MPs can claim generous housing support while simultaneously tightening assistance for vulnerable New Zealanders. The controversy is not isolated; it reflects a longer‑standing discussion about whether the existing allowance scheme, which dates back to reforms introduced under former Prime Minister Sir John Key in 2009, still serves its intended purpose of covering genuine away‑from‑home expenses or has become a perk that can be exploited for personal financial gain. The issue has drawn comments from across the political spectrum, with government ministers defending the current arrangements and opposition leaders calling for a reassessment of fairness and fiscal responsibility.
Prime Minister Christopher Luxon’s Stance on MP Allowances
Prime Minister Christopher Luxon has consistently defended the existing MP accommodation allowance, emphasizing that the remuneration and conditions of parliamentary service are determined by an independent Remuneration Authority. He told reporters that he expects his MPs to manage expenses “as best they can” and argued that involving politicians in setting their own pay or allowances would be inappropriate and could undermine public trust. Luxon pointed out that the allowance is designed to offset the costs of staying away from one’s primary residence while performing parliamentary duties, and that the system operates at arm’s length from political influence. Although he initially accepted the $1,000‑weekly payment for his own mortgage‑free Wellington apartment, he later repaid the amount after facing public backlash, describing the continuation of the claim as a “distraction” rather than a principled stance. His position underscores the government’s broader narrative that fiscal responsibility lies with independent bodies, not with elected officials adjusting their own benefits.
Housing Minister Chris Bishop’s Perspective
Housing Minister Chris Bishop echoed the sentiment that MPs are well compensated relative to the average New Zealander but maintained that the allowance is irrelevant to his personal circumstances because he resides in the Wellington region and therefore does not qualify for the payment. He acknowledged that the remuneration levels are high but stressed that they are set independently, which he regards as the appropriate arrangement. When questioned about Upston’s situation, Bishop declined to comment directly, stating he was unaware of her specific arrangements and adding, “Good for her. That’s over to her.” His remarks highlight a divide within the coalition: while some ministers defend the allowance as a legitimate, independently determined benefit, others avoid commenting on individual cases, preferring to focus on the systemic nature of the remuneration framework rather than personal entitlements.
Labour Leader Chris Hipkins and the Opposition’s View
Labour leader Chris Hipkins has been openly critical of the current MP allowance scheme, describing the practice of claiming an accommodation supplement without actually spending the money on housing as “very, very hard to justify.” He traced his disagreement back to the 2009 reforms introduced under Sir John Key, arguing that the original design inadvertently incentivized MPs to rent their own properties to colleagues rather than live in them themselves. Hipkins noted that the Labour caucus has not yet formalized a policy change but indicated that the party “may well” campaign on reducing MP perks if the issue gains traction with voters. Labour MP Kieran McAnulty, who himself claims the allowance while living in a studio flat in Petone, acknowledged the legitimacy of concerns about fairness, especially when MPs who benefit from the allowance also advocate for tightening support for low‑income households. The opposition’s stance frames the debate as a matter of equity and public confidence in Parliament.
Structure and Mechanics of the MPs’ Accommodation Allowance
Under the existing rules, any MP whose primary residence is outside Wellington is eligible to claim an accommodation payment intended to cover the costs of staying away from home while attending parliamentary duties. Ministers may claim up to $52,000 per year, whereas ordinary MPs can claim a maximum of just over $36,000 annually. The payment is deliberately neutral regarding the type of accommodation: MPs may use it to rent apartments, stay in hotels, or even arrange to rent their own homes back to themselves—a practice that has drawn particular scrutiny. The allowance is not means‑tested; eligibility hinges solely on geographic location relative to Wellington. This design was meant to simplify administration and ensure that MPs are not out‑of‑pocket for necessary lodging, but critics argue that the lack of restrictions enables misuse, as illustrated by cases where MPs claim the full amount while residing in properties they own or have long‑term agreements with.
Political Ramifications, Potential Reforms, and Broader Context
The controversy over MP allowances coincides with the coalition’s recent passage of the Social Security (Jobseeker Support and Accommodation Supplement) Amendment Bill, which raises the income‑to‑housing‑cost threshold for the general accommodation supplement from 30 % to 40 % of household income—a move the government frames as promoting fiscal sustainability by targeting assistance to those most in need. This legislative shift has intensified public scrutiny of parliamentary perks, especially as ordinary households face tighter eligibility for support while MPs continue to receive substantial, location‑based allowances. The debate may influence upcoming election narratives, with Labour poised to highlight perceived inequities and the government likely to emphasize the independence of the Remuneration Authority and the need to avoid politicizing pay decisions. Whether the current allowance structure will survive unchanged, be tweaked, or become a focal point for broader reform remains to be seen, but the issue underscores an ongoing tension between ensuring MPs are adequately compensated for their duties and maintaining public trust in the fairness of the remuneration system.