Pollies using Perks to Purchase Property

There’s nothing illegal about it, but it does kinda make you wonder whether pollies are living in the real world as the rest of us, when they can use their travel entitlements to purchase property.

I think few would argue that politicians should be adequately reimbursed for their work related travel and accommodation expenses, however when they are using taxpayers’ funds to purchase a property, then doesn’t this beg the question “who does the property belong to at the end of the day?”

Is it ethical for politicians to use taxpayers funds to purchase property which inevitably will become an asset for that individual if and when they decide to leave politics? Shouldn’t that asset belong to the taxpayer (or the Government) to then use as future accommodation for other politicians and thereby lessen the need for taxpayers money to be allocated towards covering these expenses? Or is it all just a media beat up?

Alison Rehn and Malcolm Farr at news.com.au filed this report:

Taxpayers are paying off federal politicians’ mortgages to the tune of tens of thousands of dollars a year.

A growing number of politicians are buying homes in Canberra to live in during parliamentary sitting weeks – but are still claiming travel allowances.

According to the pecuniary interests list, more than 40 MHRs and senators have bought a house or a unit in Canberra. Even more have purchased “investment” properties in the city.

A Daily Telegraph investigation has found politicians who stay in their own homes during sitting weeks – four to five months a year – are claiming travel allowance.

So taxpayers are effectively paying each of them $215 a night to stay in their own home.

This is not illegal and at least one in five politicians – from both sides of the political spectrum – do it.
Politicians claim a travel allowance for all travel away from their principal place of residence and usually they inject a local economy with funds by staying at a hotel or pub.

But according to the current list of pecuniary interests, at least 40 MHRs and senators own properties which they classify as their “Canberra residence”.

This list includes Deputy Prime Minister Julia Gillard, Opposition Leader Malcolm Turnbull, Deputy Opposition Leader Julie Bishop and Leader of the House of Representatives, Anthony Albanese.

From March last year, when Ms Gillard bought a property in Kingston, she claimed the travel allowance stipend for 44 days, netting her $8536 (when the allowance was only $194 a night).

Resources and Tourism Minister Martin Ferguson’s wife owns a house in Florey in Canberra, which he uses as his residence when he is staying in the capital.

Between January and June last year, he claimed the travel allowance for 75 days in Canberra, delivering him $14,550.

In the first six months of last year, Small Business Minister Craig Emerson claimed nearly $11,000 in travel allowance for when he was staying in Canberra.

And in a document Dr Emerson lodged only last week as an update to his pecuniary interests, it revealed he gets “periodic income from parliamentarians and staff” who stay at his place during sitting weeks.

Not one MHR or senator would go on the record, and sources would only tell The Daily Telegraph that what they were doing was completely above board.

The issue of MHRs and senators claiming travel allowance came to a head back in early 2007, when it was revealed Mr Turnbull claimed the travel allowance, which he paid to his wife whose apartment he rented.

At the time, the multi-millionaire MP said he was doing nothing wrong.

“Where you stay is of no concern to the Government. That’s the way the system works,” he said back in 2007.

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26 Responses

  1. Reb, so, many of them no longer live in rented flats either? (wink)

  2. Anything that shields our beloved politicians from experiencing the sordid distress of penury is worthwhile if you ask me. My father always said politicians order their suits to be made without any pockets because they had no need to carry a wallet. The taxpayers’ cheque book is always handy when politicians have to spend money.

    My favourite is the need for the spouse/partner of a politician to accompany said politician on one of those wretched o/seas fact-finding-missions citing loneliness as the reason. If that’s the case the next time HMAS Trouble is sent to the Persian Gulf shouldn’t the spouses/partners of the ship’s crew be onboard? It gets just as lonely doing a 6-month stint in the Persian Gulf as it does in Paris without a partner.

  3. “That’s the way the system works,” deliberately so too.

    It echoes the funding scandal which claimed the Speaker’s scalp in England recently.

    The Westminster gentlemen’s club is dead:

    …Admitting that the current system was more reminiscent of the 19th century, the Prime Minister said: “Westminster cannot operate like some gentlemen’s club where the members make up the rules and operate them among themselves. “I believe that the keystone of any reform must be to switch from self-regulation to independent external regulation,” he said.

    The change will excite constitutional experts and historians but for good reason. Independent regulation of MPs has never been contemplated because Parliament is the nation’s sovereign body. It will have to formally surrender its own power to the proposed new Parliamentary Standards Regulator.

    Legislation will be approved by this autumn to give the new body statutory force. The belated clean-up will abolish the Commons Fees Office, which has been revealed by the leaked details of MPs’ expenses in the past two weeks as positively encouraging MPs to milk or even abuse the system.

    A common refrain from MP’s seems to be that these ‘perks’ are somehow ‘justified’ as it augments their lowly incomes. Seems that they all believe they are worth much more than they get paid, so they scrounge whatever they can outside of the public gaze.

    I do note that our pollies find their spouses very useful when it comes to the ‘offloading’ of assets. And I agree that we shouldn’t be funding the spouses and kids to accompany them on travels/events.

  4. Technically, this is not the same as the UK situation (which I have been following closely with the help of an English work colleague).

    In the UK, the people were outright lying about the nature of the claims made. People were buying chandeliers, hiring landscapers for their gardens, etc. The Speaker was directly involved in helping an MP lie about when he finished paying off his house in order to help him claim non-existent interest payments on his mortgage that had already been paid out.

    Here in Australia, the situation is more the kinds of semantic wangling that is often used to get out of paying extra income tax. The house is owned by someone (who just happens to be his wife) and he is paying rent to that person for the time he uses the house for time spent in Parliment.

    It’s sophistry and immoral without a doubt, but technically legal. Also, reading some of the people they bring up – there is some sophistry involved in the reporting. They have some genuine cases of semantic wangling going on, but there are some that are being thrown in because they sound bad but aren’t the same when examining the facts.

    Gillard, for example, bought a house and claimed travel for 44 days afterward. I’ve got siblings that required six weeks before they could move into their newly bought home too. This is normal.

    Don’t get me wrong – there are Labour ministers that deserve the backlash that the Daily Telegraph is trying to build (and there are obviously also Liberal ones that deserve the same). But the same mincing of words and semantics is being used by the journalists here to make the issue bigger than it is.

    Probably because they saw the profit the UK papers were making on the issue… I’d put money on that situation being the prime moved for the research for this article!

  5. Damn it – the word “sophistry” was meant to be the only italicised one… bugger me and my fancy formatting!
    .
    Kamahloderator: fancy formatting fixed. 🙂 Why am I so kind…

  6. Certainly not a new development and it has the added benefit of a ready sale when your time is up because your successor will be on the lookout to keep the tradition ‘in-house’. Very surprised with the one in five figure, probably because the real figure is hidden in family trusts and the like. Perhaps a job for an investigative journalist?

    Then again, a significant part of the $215 allowance could be saved and invested elsewhere. Perhaps the answer is payment only for actual expenditure but I don’t think there’d be any support for that idea because those rules are for bureaucrats not politicians.

  7. We continually delude ourselves into thinking that not all politicians are self-serving parasites who place their own well-being above the interests of both the electorate and the taxpayer. The fact is that even those who don’t enter politics on that basis are quickly consumed and corrupted by the political system. It just happens to be the ‘least worst’ system of government available to us, and it is the duty of the press (and the people) to continually question the excesses of these individuals, something a compliant press has failed to do adequately due to influence and the same corruption of the elite.

    I would suggest that if the allowance is paid and results in a personal gain such as adding value to a property that benefits the recipient then the allowance should be subjected to income tax, and the added value subject to CGT upon realisation. Clearly if the property is the recipients primary place of residence then no allowance should be paid anyway.

    It is clear that by getting “periodic income from parliamentarians and staff” Emerson is skating on very thin ice, in the private business world that would be a clear conflict of interest as [possible] subordinates are being encouraged to pay money that benefits a superior (in the organisational sense). This guy should lose his job immediately.

    As for it all being legal, Turnbull has summed it up, “That’s the way the system works,” -and no doubt he’ll be one of the most outraged when the first windows break when the people realise how badly they’ve been let down by the leadership who continue to flaunt their undeserved privileges in the face of mounting hardship.

    For what it is worth, I think (hope?) Australia is in better shape than most of the rest of the world, and our parasites have better medium-term prospects than others.

  8. Prime Minister Kevin Rudd is no fan of the taxpayer-funded weight loss sessions. “It would be odd and unusual in the extreme for that sort of expenditure to be justifiable,” he said.

    I actually think that this might ultimately be of more benefit to the taxpayer than his fellow parasites’ travel allowance perks, but so far I have not seen his comments on that subject….

    (Hopefully the lucky recipients will be paying FBT on their ‘losses’ to support the taxpayer funded travel allowances for our honourable parasites.

  9. I have come into this thread late, but to me there is a simple answer, we build a hotel for them and put them all up there, where their accommodation and meals are provided at the tax payers expense. If they choose to not use that then they pay for it themselves. Simple solution.

    If they choose to have their family home away from their electorate then they have to pay.

  10. an excellent idea Joni, I’m sure that just as soon as Mr Rudd reads this he’ll implement it straight away, -how could anyone argue against it?

  11. Rudd? Read?? He spends all his down time in girly bars. No time for reading the lowly blogocrats.

  12. I’m sure he has someone to do the reading for him, -how else could he have found the way to election win if he wasn’t reading and heeding all that was written in Dunlop’s Blogocracy?

  13. LOL DM…. you mean that we did make a difference? Woohoo to us.

  14. I’m simply stopping by to say that I definitely enjoyed seeing this post, it’s really well written.

    Are you thinking of writing more about this? It seems like there is more fodder here for more posts.

    It is important that our elected representatives are responsible in managing their expenditure. I hope Ms Gillard is held accountable for her unethical and duplicitous behaviour.

  15. I hope Ms Gillard is held accountable for her unethical and duplicitous behaviour.

    Along with all the other pollies. Julia’s not the only one – so hold them all to account, even those who belong to the Liberal Party eg. Julie Bishop.

  16. Yet another excellent point Kate.

    Keep up the great work!

    Perhaps Joni and Reb could give you an editorial slot. I for one would really enjoy some balance to all these communists.

  17. Kate,

    If you are interested, please feel welcome to submit a topic for discussion.

    I’m sure Tom and many others here would be grateful for your views on such matters…

    Just send us an email to blogocrats@yahoo.com.au

  18. There is a simple solution to all pollie rorts (and they are all in this Kate not just Gillard, remember Turnbull was criticised for legally double dipping his accommodation), and that is to give the pollies a very high wage and very few allowances and incidentals.

    If you pay them an extremely good wage then you tell them they must pay for most of their expenses out of that wage. Of course what will happen in reality is the pollies will take the high wage and increase their allowances at the same time.

  19. What has amazed me is that this is the only thing that both sides of politics have closed ranks around to protect. What a bunch a hypocrits.

    And yes there should have been a unit complex built for politicians so they all stay in the one spot close to walking distance from parliament to negate the need for commonwealth cars or taxi fares as well.

  20. The unit complex sounds like it would degenerate into sorority house with all those fine people in one spot!

    Must be near a strip club though.

  21. Maybe it could be called:

    “The Poliday Inn?”

  22. It will require a moat.

  23. Kate, while we’re on rorting, can we bill the Rodent retrospectively for the cost of flying Airforce One back and forth from Sydney because Hyacinth wouldn’t live in the accommodation provided in Canberra?

  24. “Hyacinth”

    Why oh why are we struggling so much to come up with a similar disparaging nickname for the wife of our current PM?

  25. Janette is a Hyacinth whereas Therese isn’t?

  26. I’ve already suggested “Judith” as in Judith Lucy…

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