The Remuneration Authority sets the pay for key public officials. After every election, the Authority will reassess MPs’ pay and recommend changes if it sees fit.
Remuneration Authority chair Geoffrey Summers told AM in relation to other Westminster-style democracies, our MPs are paid around 30 percent less.
“I certainly wouldn’t say that in terms of democracy paying people who run their democracies, we’re certainly not ahead, we’re probably a little bit behind,” Summers said.
However, there has been criticism raised over the Government receiving pay raises while simultaneously cutting costs in the public sector.
It has been tough economic times for many Kiwis as the country entered a recession earlier this year. Inflation also remains sitting above the Reserve Bank’s target range at 4 percent, while unemployment has rose to 4.3 percent with economists predicting the number of people out of work to grow.
Summers said in times of economic hardship, the Authority can give lower pay raises than it otherwise would have. This was done at the previous review.
“This year we’ve looked at it and said that the current environment doesn’t quite meet that test. We need it to be prudent so that’s why we have been careful with how much we’ve paid, or we’ve determined should be paid during the next three-year period,” Summers said.
How New Zealand politicians’ annual salaries compare
In New Zealand, ordinary MPs- aka ‘backbenchers’ -will earn $173,400 from July 1. This will rise to $181,200 over the three years.
Prime Minister Christopher Luxon’s salary on July 1 will become $484,200. By the end of the Parliamentary term, the Prime Minister would be on $520,500.
However, Luxon said he will be donating his pay rise to charity.
Newshub has crunched the numbers on how politicians’ new pay starting on July 1 compares to overseas counterparts (currency conversion rates are accurate as of May 3).