John Key has announced changes to Ministerial accommodation.
He said the aim was to have something which is simple, easy to understand, transparent and cost effective; gives value for money to the taxpayer and offers suitable accommodation for Ministers and their families.
Ministers will make their own arrangements and pay for it out of a fixed payment of $37,500 per year equivalent to a market-based estimate of rent and a small contribution to other costs. Only one payment of $37,500 will be made per property.
A second category of payment, of $30,000 per year, will be created for Ministers who remain in the same home for which they are currently claiming the parliamentary allowance of $24,000. The $30,000 payment replaces the parliamentary allowance.
In the event that a Minister chooses to live in a hotel, they will be reimbursed for their actual expenses up to a cap of $37,500 per year.
No change will be made to properties which are leased by Ministerial Services because that would incur additional costs.
“These decisions reflect my desire to see a simple, transparent and cost-effective system for ministerial accommodation,” says Mr Key.
“The higher allowance for Ministers compared to MPs reflects their greater needs because of their obligation to spend considerably more time in Wellington. The review notes that if Ministers purchased the equivalent services for their accommodation directly, the average cost is $48,295 per year, so the new rates do not, in most cases, cover the full cost.”
Ministers may not be happy that the new allowances don’t cover all their costs but it would not be wise to argue publicly about that in the current economic climate.
The review recommended selling properties the Crown owns. However, that won’t be done in this parliamentary term.
Homepaddock 
I’ve done some calculations (excluding the out of Wellington Ministers who live in Crown owned properties who apparrently will not be affected, and adjusting on the presumption that Bill English has repaid the portion of his allowance he said he would) based on the Ministerial expenses return for the first 6 months of this year.
I reckon this “reform” will result in around an additional $55,000 being paid out in Ministerial accommodation expenses.
Key is probably right in his answers to questions in Parliament yesterday that the savings in administration costs will be more than that.
But that is not the point. The $55,000 will not be expended on Ministerial accommodation unless some of those currently paying the least upsize their accommodation. It will end up in those Ministers’ pockets.
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