Pay cut changes for MPs imminent

Prime Minister Jacinda Ardern has confirmed a proposed bill that will allow MPs and councillors to take pay cuts is being drafted.

Ardern said she expected the legislation, which was being overseen by the Remuneration Authority, to be ready ‘‘shortly’’.

‘‘Yes, the way that MPs are paid and others, such as local government, sit within that [draft] remuneration legislation,’’ she said.

This month, Ardern announced she, along with ministers and 34 government department heads, would take a 20 per cent pay cut due to coronavirus to show leadership and solidarity with those being hit the hardest during the pandemic.

The Government was only able to make the pay cut decision on behalf of ministers but this still required legislative change because under the law you can’t lower someone’s pay.

The authority sets the remuneration – salary, fees, certain allowances and superannuation – for members of Parliament, including the prime minister and ministers.

Parliament has to change the law to allow the authority to make changes.

The only current option is to donate to charities. So when Parliament resumed on Tuesday, ACT leader David Seymour attempted to have a bill introduced and debated that would reduce all MPs by 20 per cent for six months. However, he was immediately shot down by Finance Minister Grant Robertson.

Regardless of timelines for the legislation, ministers had still committed to six months of pay cuts, Ardern said.