Lump sum plan for MP homes

A lump sum payment to MPs to cover their living expenses in Wellington is being considered as the controversy surrounding their housing expenses refuses to die.

Parliament's Speaker Lockwood Smith signalled yesterday that he would be sounding MPs out on whether the system should be changed as they were dogged by claims that MPs had rearranged their affairs to maximise the accommodation allowance, worth up to $24,000.

Yesterday Labour demanded an independent inquiry after it was claimed Parliament's Deputy Speaker, Lindsay Tisch, had maximised his allowance by renting his Wellington home from his own property investment company.

But it is understood Mr Tisch is not the only MP to use this arrangement – though there is no way for the public to know.

MPs do not have to disclose property owned by a trust or company in the register of pecuniary interests, which is supposed to serve as a public record of what MPs have a financial interest in.

Only a third of MPs declared a Wellington property in this year's register, despite being able to claim up to $24,000 a year in interest payments on their mortgage. More than 70 MPs have trusts and companies.

Mr Tisch said yesterday he claimed $410 a week on his property, which was less than its market value, and had sought an independent valuation, which was likely to show it was worth more than that.

Dr Smith said Mr Tisch's arrangements were within the rules, but he signalled that he was "exploring various options", including a single flat rate payment to all MPs.

That would mirror changes to the ministerial accommodation allowance after controversy over Finance Minister Bill English receiving nearly $1000 a week to live in his family home. Ministers are now bulk-funded up to $37,000 a year.

Dr Smith said recent changes had made the current system more transparent, including requiring a market valuation on properties in which MPs had a financial interest.

"I think the system we have now is reasonably transparent and it is difficult to abuse the system, but that doesn't mean we can't develop something better."

A flat rate was "one obvious option" but he did not want to make changes that ended up costing taxpayers more. MPs claimed on average less than the $24,000 maximum at present and some were living quite cheaply. A flat rate meant they could just pocket the difference.

- © Fairfax NZ News