Members of Parliament (Remuneration and Services) Bill

on behalf of the Prime Minister: I move, That the Members of Parliament (Remuneration and Services) Bill be now read a second time. This bill improves the law relating to elected members’ remuneration and entitlements to services. It was referred to the Government Administration Committee in March 2012. The committee completed its examination of the bill in June 2013, unanimously recommending that it be passed as amended.

The bill deserves nothing less than careful and detailed consideration by the Government Administration Committee and the House for it establishes a new framework for setting entitlements for members of Parliament and the executive. With modifications it implements many of the recommendations in the Law Commission’s Review of the Civil List Act 1979 — Members of Parliament and Ministers. The bill repeals the Civil List Act, and modernises and modifies the law relating to the salaries and the allowances of members of Parliament; support services provided for members of Parliament, Ministers, and certain electoral candidates; annuities and other benefits and privileges for former Prime Ministers; and benefits and privileges for former members of Parliament, and I see you are very interested in that part of it, Mr Assistant Speaker Robertson.

In relation to Part 3 of the bill, concerning services to members of Parliament, the Remuneration Authority is responsible for determining accommodation services for MPs and Ministers, and also travel services for family members of MPs. The Speaker is responsible for setting directions on travel and communication services for MPs and party and member support funding, and the Minister responsible for Ministerial Services is responsible for determining any additional travel services for Ministers over and above those set by the Speaker for members of Parliament.

Some submissions to the Government Administration Committee expressed concern for the Remuneration Authority setting travel services for MPs and Ministers as was proposed under the original bill. It was considered that the proposed reforms did not reflect the principle that the House has the exclusive privilege to control its own operations. The select committee acknowledged that domestic travel by MPs is critical to the effective functioning of the House. The committee considered that concerns for a non-parliamentary body setting travel entitlements for MPs can be addressed by amending the bill to provide that the Speaker continues to determine travel services for members of Parliament. This should allay concerns about the authority making a determination limiting the ability of MPs to travel, and, therefore, limiting their ability to do their job.

There are some intersecting interests here. One is having entitlements determined independently from those who receive them, and the other is the democratic interest and the proper operation of the House, and the ability of members to carry out their functions. The democratic interest is of fundamental importance and is worthy of being protected from any risk of decision making that could undermine that interest. Under this bill travel by spouses and family members would remain within the exclusive purview of the Remuneration Authority as that travel cannot be said to directly carry the risk of limiting the ability of members of Parliament to carry out their roles.

The Remuneration Authority would continue to determine accommodation services for MPs and Ministers. Although accommodation entitlements are important in supporting MPs to carry out their roles, on balance travel is seen as more significant. The reality is that MPs need to be accommodated while attending to their duties such as in this House. Any additional travel services, excluding international travel and accommodation for Ministers would be determined by the Minister responsible for Ministerial Services.

The bill, as reported back from the select committee, introduces a number of other reforms additional to Part 3. It updates the legislative framework for the setting of salaries and allowances for MPs and Ministers. This will allow members who start mid-term following the vacancy of a seat previously held by a list member of Parliament to be paid lawfully. The bill validates that commencement of salaries paid to mid-term list MPs since 1996 without further costs to the Crown.

The financial penalty for members who are absent from the House without permission is substantially increased, with deductions starting after 3 days’ absence. The amount deducted reflects the member’s actual salary rather than the salary of an ordinary member. The financial penalty for absent members used to be based on an ordinary MP’s salary; now in the bill it is based on the actual salary of the member, and it commences after 3 days of absence rather than the 9 days in the original bill.

A new financial penalty for members who are suspended from the House will apply. This reflects the recommendation of the Standing Orders Committee. A legislative obligation on the Remuneration Authority is imposed to include in any determination of salaries and allowances a statement setting out how it has taken into account the personal benefit or potential personal benefit of any other entitlement when determining those salaries and allowances. Additionally, entitlements to services are to be determined in a way that takes into account the particular requirements of members with physical or sensory impairments.

The bill codifies moves made in recent years to improve transparency around costs to the House. It imposes a statutory obligation on the General Manager of Parliamentary Service and on the Department of Internal Affairs to publish quarterly reports on travel and accommodation costs for MPs and Ministers. It also imposes a statutory obligation on the Clerk of the House to publish quarterly reports on MPs’ and parties’ use of the inter-parliamentary relations programme. The operation of the scheme providing certain former members with entitlements is addressed. As recommended by the Law Commission the bill legislates for the former-member travel entitlements of MPs elected before 1999, making those entitlements transparent and changeable only through legislative amendment.

A new statutory regime will set out how travel entitlements can be lost, including for various offences. A statutory obligation is imposed on Parliamentary Service to publish the travel expenses of former members of Parliament annually. And the bill tightens up the law around the making of superannuation contributions by MPs. It also includes a statutory review clause, meaning that the Act’s operations must be reviewed after two full determination cycles. This will allow the House to assess how well the changes contained in this bill are meeting its aims and purposes.

These are not radical or modest changes to the regime for setting entitlements for MPs and members of the executive. These are sensible but significant changes that will ensure that this House and its members are properly supported in a way that maintains confidence in the integrity of Parliament. I commend the bill to the House.

I rise to support the Attorney-General in so far as this bill, the Members of Parliament (Remuneration and Services) Bill, is concerned. I am not quite as enthusiastic as to the results as he is. In fact, it might now be seen as a bit of a muddling bill, a bill that has fallen halfway between the Law Commission and the current situation. I will get back to that. But what it does do, and I agree with the Attorney-General, is that it makes the law with regard to the payment of salaries and matters relating to the business expenses of members of Parliament, including members of the executive, clearer and more workable. There is, I think, quite a lot of public apprehension around the setting of members’ salaries and allowances, and the repayment of their expenses. I think that many members of the public think we in this House decide the level. Frankly, the constant expression of opinion by the Prime Minister as to what the changes should be does not help very much. I think the public tend to think that the Remuneration Authority is not independent, and that there is some sort of obligation for it to listen to the Prime Minister when he makes those comments.

There are a number of changes here. I want to say that new clause 17(1)(ab) provides for the arrangements for services to take into account particular requirements of members who have physical or sensory impairments. I think it is important that we get that specifically into the legislation in a way that is clear but flexible, because there will be a wide variety of needs of members with impairments, but it makes it clear that there are obligations in place. I think there will be a number of members of the House who will be somewhat surprised by the fact that up until now there has been no provision to pay members of Parliament who come in from the list in the middle of a term. We have had a number of people for whom that has occurred, and on a couple of occasions for some of those individuals, and up until now there has been no provision to pay them. They have, of course, been paid. They would have complained if they had not been. What this bill does is make sure that in the future anyone who is in that situation is able to get paid, and retrospectively. I think it is an OK use of retrospective legislation. It retrospectively validates the payments that have previously been made, although there are one or two of them where I would say that it might have been better if we had not.

There are provisions with regard to the deduction of members’ salaries. The Government Administration Committee took some time to harden up the legislation in this particular area in two ways. We did take into account a number of members who I think might be described as sort of lackadaisical in their attendance to the parliamentary part of their duties as members of Parliament. What we, the committee, have suggested, and I think the House will agree, is that unlike the 9 days of absence that the Prime Minister had previously suggested, deductions should occur after 3 days. We are also looking at the salary level of the particular member, rather than the salary level of a backbench member, for those deductions.

There will also be a pay deduction when a member is suspended from the House. I want to say that I have been around for a while and I have worked on the assumption—

💬 Hon Anne Tolley: And been suspended a few times.

I have never been suspended. Is that not amazing? I had always thought that a financial penalty applied to people. I thought that if they were out for a day, they lost a day; if they were out for a week, they lost a week; and if they were out till the end of the year, they lost the rest of their pay—not that that has happened in the time I have been here. I think the maximum that I have known of is someone who has been out for just a day. But this bill makes it clear that if you get suspended, you lose a day’s pay. I think that is what the public would expect, and I think that is fine.

There has also been what I would describe as a bit of a rort, where other members, I understand, have been working with these rules that are to do with members’ superannuation. Most of us, when we join a superannuation scheme, using the arrangements as part of our remuneration, and, remembering that the contributions come, effectively, from our gross remuneration, as determined by the Remuneration Authority, put the money in out of our fortnightly pay by way of deductions. There have been some members who have made a decision to do it considerably later, accumulate the interest on that or other investments, top it up right at the end of a period, and thereby get an advantage that was not otherwise considered. We do not think that is right, and this bill will mean that the subsidy will not be payable to members. It will not be able to be backdated for more than 12 months. I think that is fair enough.

The one proviso I will say is that I do not have total confidence in Parliamentary Service to get it right. I myself have had experience with superannuation deductions that it unilaterally stopped. We then had to sort it out. In fact—

💬 Grant Robertson: They thought you’d gone.

What?

💬 Grant Robertson: They thought you’d gone.

Well, Parliamentary Service might have thought I had gone. In fact, I have got quite a lack of confidence, even in the current day, with Parliamentary Service and its handling of reimbursement arrangements for members. Parliamentary Service sent my bank account details to Vodafone recently. It sent the slip that we get with the reimbursement of our travel arrangements, along with my bank account numbers, off to Vodafone. I was quite surprised when I found that out. I was not happy.

I do want to say that there is a bit of a muddle in this arrangement now, and I want to give the example of when a Minister—say, the Prime Minister—was in Wellington, travelled to Christchurch, and stayed overnight before going on an overseas trip. The arrangements for the flight from Wellington to Christchurch or Auckland to Christchurch would be determined by, and be the responsibility of, the Speaker. The overnight accommodation in Christchurch, while waiting for the early flight to go out the next morning, would be the responsibility of the Remuneration Authority. The overseas travel the next morning would be the responsibility of Ministerial Services. I think it is fair to say that is a bit of a muddle, and it will, in the end, lead to confusion.

My last comment I want to make is to the Greens. I want to make it in particular to the co-leader Metiria Turei, and say to her that she voted in the select committee for every clause and every amendment that was made. She voted for it. I say to her that to come to the House now, having not given a peep in opposition—not a peep in opposition, so she was a lamb in the committee—

💬 Hon Tau Henare: Not a word, not a whisper.

Not a word, not a whisper—not a whisper. To come to this House now with a set of amendments attempting to reverse that is an indication of someone who is either not properly on top of their job or is a political grandstander. I say to her that if you have got the courage of your convictions, vote in the select committee. If the member believes in something, vote that way in the select committee. Be consistent. Do not come to the House and change your mind.

Debate interrupted.