Some NSW MPs are using an annual taxpayer-funded allowance ranging from $77,000 to $203,000 to top up their salaries because there is no obligation to provide any documentation to the parliament on how they spend the entitlement.
The Parliamentary Remuneration Tribunal, which determines pay and allowances for NSW politicians, has written to all state MPs seeking submissions on a review of entitlements, including the electoral allowance, which is paid into MPs’ accounts to cover “incidental expenditure”.
The allowance starts at $77,000 for Sydney members and peaks at more than $200,000 for the largest electorate, Barwon, which covers 41 per cent of the state.
The tribunal’s report to MPs said base salaries would not increase this year after NSW Labor honoured an election promise to freeze politicians’ pay for two years, but other entitlements would increase, including the electoral allowance.
The report said some MPs had “concerns about the differing levels of personal income which members receive for the performance of their parliamentary work”.
The entitlements system was overhauled in 2016 and the previous so-called logistics support allocation was replaced with the electoral allowance, which is paid monthly with MPs’ salaries.
“What use a member makes of the allowance is thus now no longer transparent or publicly available, even to the parliament, the tribunal or the Electoral Commission. It is only known by the member and the Tax Office,” the report said.
“Particular expenditure is left entirely to members’ discretion.” This leaves “open the possibility that part of the allowance can be used to increase a member’s personal income, which is then taxed in the usual way”.
NSW MPs, with a base salary of $172,576, are among the lowest paid in the country. The worst paid are in Tasmania, where an MP earns $140,185. In Victoria, an MP attracts a base rate of $205,798 and in South Australia MPs are paid $226,053.
Independent Murray MP Helen Dalton’s electoral allowance is $143,050. She said while she was unsure of the exact quantum of her expenses, servicing her vast electorate was costly.
Dalton’s electorate covers about 110,000 square kilometres. She said it was common to charter a plane to ensure she could visit more than one community event on a weekend. Driving would make that impossible, she said.
“The Wentworth Show (on the Murray) and the Salami Festival (in Griffith, 366 kilometres away) are on the same day and as the local member I am expected to be at both,” Dalton said. “It’s different for city MPs. It’s not uncommon for me to travel three hours each way to see 50 people.”
Lake Macquarie MP Greg Piper said few MPs would be “getting rich” from the electorate allowance but he acknowledged some would pay tax on the unspent portion.
“Most MPs would expend the lion’s share of their allowance on the costs of servicing their electorate,” Piper said.
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