PM declares salary halt for all MPs

MPs will have to go without a pay rise for a year after the Government indicated it would freeze salaries while a review of the pay-setting system is carried out.

The latest pay rise, of 3 per cent, was due to kick in this month and be backdated to July 1, but Parliament will pass a bill under urgency to hold the current pay for a year.

Prime Minister Jacinda Ardern said it was not appropriate for MPs to be subject to such an increase.

The Cabinet had been advised of the impending 3 per cent pay increase which was based on a formula under law, and involved no discretion.

She said she had contacted National leader Simon Bridges and he was supportive of the decision to freeze and review pay setting.

“It is about values. We are focused on raising the income on lower to middle-income earners,” she said.

Ardern said the way the draft increase had been determined did not seem fair.

“We want to give transparency and have another group determine how our increases in salaries are determined,” Ardern said. “We do not believe, given that we are at the upper end of the scale, that we should be receiving that sort of increase.”

The freeze applies to MPs’ salaries, superannuation subsidies and expense allowances.

Current pay rates for MPs: Prime Minister $471,049, Deputy Prime Minister $334,734, Cabinet Minister $296,007, Minister outside cabinet $$248,839, Speaker $296,007, Leader of the Opposition $296,007, Backbench MP $163,961.