Green Party announces new MP pay policy

Sunday, 09 Mar 2014 | Press Release

As representatives, it is our duty to be a part of the solution to inequality.

The Green Party has today launched a new policy to link MPs’ salaries to the median income, to make sure that MPs’ salaries are part of the solution to rising inequality, rather than part of the problem.

Under this policy, MPs salaries would increase or decrease by the same dollar amount that the median individual income increases or decreases. Rather than the current annual review carried out by the Remuneration Authority that sets MPs’ salaries, the Remuneration Authority would be required to apply the annual change in median individual income supplied by Statistics New Zealand.

“The Green Party thinks that MPs’ salary increases or decreases should be directly linked to the movement in the incomes of middle New Zealand,” said Green Party Co-leader Dr Russel Norman.

“Only when middle New Zealand is better off should MPs’ salaries increase. If middle New Zealand is in a worse situation, MPs should not be getting big pay top-ups.”

Last year, the base salary for an MP rose by $3,000, while over the same period, the median individual income rose by $780. If this policy was in place, MPs salaries would have increased by $780.

“We want to live in a society that has less inequality. This means those at the bottom deserve to share in the gains that those at the top are currently receiving,” said Dr Norman.

“The current wage setting process for MPs has increased the gap between MPs and middle New Zealand over time.

“MPs’ salaries are linked to the private sector and those earning the most, while the majority of New Zealanders are left behind.

“The current process effectively pegs MPs’ salaries to the pay rises of the top few percent. Our proposal would link MPs salaries to changes in income of the person in the middle.

“This policy will also encourage MPs to consider how their policies affect the person on the median income.

“Our system incentivises MPs to reduce inequality by increasing the income of all New Zealanders, especially those in the middle and the bottom.

“We need to make sure that MPs remember that the vast bulk of New Zealanders get by on much less than we earn.

“Our policy is a much more objective way to set MPs’ salaries than the current method, which relies on a number of subjective assessments by the Remuneration Authority.

“As representatives, it is our duty to be a part of the solution to inequality. This is an important commitment for us to make.”

*Taken from Annual Parliamentary Salaries and Allowances determinations
** Taken from the Statistics NZ New Zealand Income Survey

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