PM Christopher Luxon’s allowance saga raises questions about politician entitlements

Saturday, 2 March 2024

Prime Minister Christopher Luxon on Friday afternoon vowed to pay back $13,000 he claimed for an accommodation entitlement while living in his Wellington apartment, instead of Premier House.
He had claimed the $31,000 annual accommodation allowance while living in his home as an MP, and was going to claim up to $52,000 a year while prime minister.
Premier House is in need of renovations but Labour Party leader Chris Hipkins says it is livable, warm and dry.

Prime Minister Christopher Luxon’s promise to pay back $13,000 of taxpayer cash he claimed while living in his Wellington home has raised critical questions about the ways politicians can pad their salaries with public money.

Auckland-based Luxon, who is a multimillionaire and owns seven properties mortgage-free, first said he was entitled to claim $52,000 a year of public money because he was not living in Premier House, before yielding to pressure on Friday afternoon.

Christopher Luxon at his home in Auckland, where he is based. (File photo)

Luxon, who spends two nights a week in the capital, made the u-turn after first rejecting suggestions it was hypocritical to claim taxpayer cash when he could stay at the Thorndon residence, at no extra cost to the taxpayer.

Luxon and his Finance Minister Nicola Willis are promising to “restore a culture of fiscal discipline” and cut public services by between 6.5% and 7.5%.

“It is an entitlement and I am well within the rules,” Luxon said, before adding there would be many other MPs also claiming the money.

Fewer than two hours later, his office released a statement and he appeared on Newstalk ZB to announce he would pay back the money. He said talkback hosts Heather du Plessis Allan and Kerre Woodham had changed his mind.

However, the focus on the revelations and renewed interest in Luxon’s personal wealth - expected to carry on into next week - will serve as an unwelcome distraction for his government.

Luxon and his ministers would prefer to focus on National’s policy programme, and its moves to repeal legislation and policy established by the former Labour government ahead of March 8 - 100 days after its election victory.

Luxon was also claiming $3750 in taxpayer cash a month to rent his electorate office, based in Northpark, in Auckland financial disclosures published in August and covering the year to June, show. Luxon owns the property, which is now valued at $1.52million.

Sir Bill English was dubbed the “double dipper from Dipton” after claiming public money while living in his Wellington home.

MPs have to declare any conflict of interests relating to electorate office leases, and MPs across the House are renting electorate offices where the landlord is a related party.

At least 20 MPs across parties are claiming up to $45,000 to stay in their own Wellington homes, meaning taxpayers are helping to pay their mortgages.

Sir Bill English, a former deputy prime minister and finance minister from the National Party, earned the nickname 'the double dipper from Dipton' for claiming $32,000 in taxpayer cash to live in his Karori home.

Sir Bill, who was from Dipton - a small town 60km north of Invercargill - ended up paying back the accommodation supplement and promised to stop claiming it.

Luxon earlier on Friday said he would “ideally” live in Premier House, but that it was in need of structural repairs.

He was still “digesting” a report, passed on from Labour Party leader Chris Hipkins, near the end of his tenure as prime minister last year.

Hipkins said it outlined how Premier House had a variety of structural issues, but that it was warm, dry and liveable.

“It's what you would expect; the carpet’s pretty worn, the décor is pretty dated, and it does need some work. But it is still liveable. I did not live in Premier House but I did stay there on occasion and it was comfortable enough accommodation.”

A separate November briefing on Premier House outlines the need for investment to “protect and restore” its “integrity” as well as to “reflect its purpose and status”, but it did not say the residence should not, or could not, be lived in.

Hipkins said it was hypocritical and a “slap in the face” for public servants losing their jobs.

“If he wants to live in his own apartment, I think that's fine, but he shouldn't be asking the taxpayers to subsidise that when there is a free house just down the road that he could move into today,” he said.

MP accommodation and travel expenses are released every three months by the Parliamentary Service and the Office of the Clerk.

These are the costs of travelling between their home, constituency and Wellington, and for them to live in the capital during sitting weeks. MP expenses came to almost $1.7m and the costs incurred by ministers came to more than $670,000, for the three months ending December.