15 Nov 2010

MPs' overseas travel perks should go, says Key

6:23 pm on 15 November 2010

Prime Minister John Key advised Speaker of the House Lockwood Smith on Monday that National believed MPs' international travel entitlement should be abolished.

The move comes after Cabinet minister Pansy Wong resigned her portfolios after admitting her husband had broken the rules by doing business on a taxpayer-subsidised trip to China.

Mr Key says National MPs believe the entitlement has now outlived its usefulness and should be scrapped as soon as possible.

He has asked Dr Smith to refer the matter to the Remuneration Authority, which is independent of political parties.

Mr Key says it should be for the authority to determine how best to abolish the entitlement and to determine what changes, if any, should be made to MPs' salaries. But he believes any change to MPs' salaries should be very modest.

Mr Key says the question of whether MPs' remuneration and expenses should be determined by an independent body is worth considering.

Earlier on Monday, Mr Key said he was happy to discuss a review at some point. "It may well be a time when people do go and reflect on whether all of the allowances and the way that they're structured are appropriate, but I just need to take some advice on that and have some discussions with one or two of my senior colleagues."

Ms Wong resigned from Cabinet last week but still faces a Parliamentary Services inquiry.

Her case has sparked calls for a review of the system under which MPs' expenses and allowances are administered.

MPs are paid a set salary, but get thousands of dollars in extra travel and accommodation allowances each year.

One alternative would be to scrap the extras and increase salaries accordingly, but there's an acknowledgment among some MPs that such a move would not be popular with voters.

Mr Key says Ms Wong is already paying a heavy price for her failure.

Labour Party leader Phil Goff says it may not end there for Ms Wong. He says the MP will have to take responsibility for any further breaches of the rules that may be revealed by an inquiry.

National Party senior whip Chris Tremain says Ms Wong has been given one week's leave from Parliament.

Mr Goff says the time has come to review the system, to make it simpler and more transparent, while the Green Party says an independent body should be made responsible for overseeing MPs' entitlements.

Meanwhile, Labour has released documents showing that two companies are registered at the same address as Ms Wong's electorate office in Auckland, one belonging to her husband.

Company records show Sampan Enterprise Ltd, of which Sammy Wong is the sole director and shareholder, is registered at the same Chapel Road address as the Botany MP's electorate office.

Another company, Shipley and Wong Ltd, whose shareholders are Mr Wong and the former prime minister Dame Jenny Shipley, is also registered to that address.

Labour MP Pete Hodgson, who released the information, says he is not sure if this breaks any rules.