4 Aug 2009

Minister hits back at housing expenses criticism

9:29 pm on 4 August 2009

Finance Minister Bill English hit back at criticism of his accommodation expenses, saying he has more important issues to deal with.

Prime Minister John Key has asked Ministerial Services to review the rules covering ministerial housing allowances, saying they are arcane and confusing.

The move follows the release last week of expenses information, including accommodation and travel, claimed by MPs and ministers.

The data revealed that Mr English receives a $700 a week housing allowance for a Wellington property his family has owned for several years.

Mr English, the deputy prime minister, says he did not change his status as a trustee to his family trust to get a higher accommodation allowance.

He received almost $24,000 in the first six months of this year towards the cost of his family home in Wellington. The home is owned by a family trust of which Mr English was a trustee while he was an opposition MP.

After National won the election in 2008, Mr English ceased to be a beneficiary of the trust, allowing him to claim a higher accommodation allowance.

But the Clutha-Southland MP says the move was made for personal and family reasons and was not about the money. He says he has complied with all the rules.

Mr Key supports Mr English, saying he is not getting any more assistance than other ministers who come from electorates outside Wellington.

Mr Key says housing plays an important part in keeping ministers' families together, but he believes a better system can be developed which will result in better value for taxpayers' money.

However, the Labour Party says it appears the Government has changed the rules relating to the expenses of ministers who choose to stay in their own home in the capital.

Labour MP Clayton Cosgrove says when he decided to stay in his Wellington flat when he became a minister, he was only eligible for about $24,000 annually.

Labour has welcomed the review and wants to have some involvement in it.

Rules appear to have changed - Chief whip

Chief whip Darren Hughes told Morning Report the rules appear to have changed since the 2008 election.

Mr Hughes says out-of-town MPs are allowed to claim up to $24,000 per year for Wellington accommodation, but it now seems ministers can claim a lot more than that if they stay in their own homes.

He says the review is needed to ensure the system is fair to ministers and taxpayers.

Other ministers benefit

Defence Minister Wayne Mapp has admitted his family trust receives taxpayer-funded rental income on a Wellington property he lets to another MP.

At the same time, Dr Mapp is collecting more than $700 a week towards his current accommodation.

Dr Mapp says his one-bedroom flat is rented out at market rates of about $400 a week to a National Party list MP.

He says the income goes to the trust, so legally cannot be used towards the cost of his new place.

But Dr Mapp says he can understand why the public would expect the money to be used to off-set his costs, which is why the Prime Minister has initiated a review.

Housing Minister Phil Heatley also rents out his Wellington flat, but will not say whether his tenant is another MP.

The Housing Lobby campaign group says Mr Heatley is sending the wrong message to state tenants.

Mr Heatley received $24,000 during the first six months of this year. The group says his actions are immoral and he should not get a subsidy.