Written By: - Date published: 8:44 am, November 11th, 2013 - 89 comments
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You’ll remember that, back in 2009, Bill ‘Double Dipton’ English was caught claiming an ‘out of town’ allowance – intended to pay for non-Wellington-based MPs’ accommodation in the capital – to pay the mortgage on his family home in Karori. Key’s solution was to let all his ministers claim the rort. Now, it turns out some of them are doubling down on the rort.
The play goes like this:
MPs are able to get Parliamentary Services to match their superannuation contributions at a rate of $2.50 of every dollar they put in up to $28,920. Why that much? Well, it equates to the MP contributing 8% of their salary, the maximum you can put into Kiwisaver.
But what if you don’t want to contribute 8% yourself to get your 20% top up from Parliamentary Services? How can you get your hands on the bonus cash anyway?
Set up a private superfund. Make that superfund own your house. Your mortgage payments go into the superfund. Now, the mortgage payments you would have to make anyway are getting matched 2.5 to 1 by Parliamentary Services.
You’ve gained $29,000 a year for doing nothing other than add a step to how you pay your mortgage.
Add in the accommodation allowance for another $37,500 if you’re minister, $24,000 for a backbencher.
I suspect there’s more to this. The housing double-dip is being used by 6 MPs, but why do another 29 National MPs have private superannuation funds as well? 35 of National’s 59 MPs have private superannuation funds. The entire rest of New Zealand’s 4.5 million-strong population has just 203 private superannuation funds between us. Put it another way: 59% of National MPs have these funds; just 0.005% of the rest of the population has one. They’re up to something.
I reckon it will be more payments that they need to make anyway being routed through superfunds as contributions to get the Parliamentary Services bonus.