22 Oct 2013

PM dismisses argument over pay gap

5:31 pm on 22 October 2013

Prime Minister John Key says he doesn't buy the argument that the pay rate of MPs should have to keep pace with comparable positions in the public and private sectors.

The independent Remuneration Authority issues a determination each year, usually in December, about whether MPs should get an increase, and if so, by how much.

John Key.

John Key. Photo: RNZ

In 2012, the authority awarded MPs a 2% pay rise backdated to July, saying MPs' pay rates continued to lag behind general pay increases.

John Key says while it's ultimately up to the authority to decide, MPs should not be getting a pay rise this year. He acknowledges MPs do get paid less than some others in top positions, but says it's not all about the money.

"There's an element of public service and there are many other advantages, if you like, experiences that people get. So if they're here for money, personally, I think they're in the wrong place."

Mr Key if the authority does decide on an increase, it should be no more than the rate of inflation.

Labour Party leader David Cunliffe says Mr Key is playing cheap politics with this issue.

"He's saying what he thinks the public wants to hear even though he was in agreement with the new process, which was to take the matter out of the hands of politicians."

Mr Cunliffe says Mr Key should respect the statutory right the authority has to operate independently.

Meanwhile, a bill that transfers the responsibility for determining accommodation for MPs, travel allowances for MPs families and ongoing travel entitlements for former MPs is back before Parliament on Tuesday for its second reading.

At the moment those matters are decided by either the Speaker of the House, or the Minister Responsible for Ministerial Services. The bill seeks to transfer that responsibility to the independent Remuneration Authority.