Taxpayer foots bill for MPs’ rental deal

Taxpayers are paying to rent two of the seven properties in the portfolio of National MP Christopher Luxon, who is among more than a dozen MPs that use parliamentary accommodation allowances to effectively rent property from themselves.

MPs from outside the Wellington region are allowed to claim a capped accommodation allowance to cover their living costs in the city. Most use it to rent flats or hotel rooms but more than a dozen MPs purchase Wellington accommodation and claim the allowance – effectively renting their Wellington accommodation from themselves.

Luxon’s current and former party leaders, Judith Collins and Simon Bridges, both claim the allowance. As of the most recent register of MPs’ property holdings, both own Wellington accommodation. Andrew Bayly, Jacqui Dean, Barbara Kuriger, Melissa Lee, Ian McKelvie, Mark Mitchell, Simon O’Connor, Stuart Smith, Louise Upston and Michael Woodhouse also claim the allowance while owning Wellington accommodation.

Labour MPs Willie Jackson, Jenny Salesa, Jamie Strange and Jan Tinetti have also declared a pecuniary interest in a Wellington property. At the time of publication, representatives for these MPs had not answered whether they claimed a parliamentary allowance for living in those properties while in Wellington.

The arrangements are within Parliament’s rules and there is no suggestion of wrongdoing. The register of MPs’ pecuniary interests, due out this month, will likely turn up more cases of new MPs renting property to themselves at taxpayer expense.

While it is common for taxpayers to foot the bill for MPs renting accommodation from themselves, Luxon has also bought an office in his Botany electorate which he leases back to Parliament for use as his electorate office. That is far less common. Former MP Amy Adams owned her own electorate office, as did former prime minister John Key. Current National MP Nick Smith rents his office to himself through a company he owns.

MPs are required to get an independent valuation of the appropriate rent level if they own their own offices, to protect against a rogue MP hiking the rent at taxpayer expense.

This puts a lid on the financial benefits that accrue to MPs who use this type of arrangement.

The main benefit to an MP who owns their office occurs when they sell the property. The buildings are then sold, with the profits, in many cases untaxed, falling entirely to their owners.