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Have your say: Lindsay Tisch claimed Govt rent allowance for living in his own rental
By Bernard Hickey
The New Zealand Herald reported this morning that National MP and Deputy Speaker Lindsay Tisch has been living in his own apartment in Wellington and claiming NZ$21,334 a year in expenses for being an 'out of town' parliamentarian. Tisch was charging the government NZ$410/week for living in the apartment on the Terrace that cost him NZ$260,000 in 2003, generating a return of 8% for the company that Tisch and his wife Leonie own.
The apartment has made a capital gain of $20,000, the most recent valuation rating it as worth $280,000.
Mr Tisch said the rent was set independently at the market rate and he was not doing anything wrong by funnelling the money through his own company. "It doesn't matter whether it's going in there [his company] or going to my paying to Joe Bloggs down the road," he said.
As Deputy Speaker Mr Tisch is paid a base salary of NZ$169,900 a year as well as getting a NZ$14,800 expense allowance, travel perks and a superannuation contribution.
Tisch is not the only MP doing this.
Other MPs are using similar arrangements to Mr Tisch, but Parliament's Speaker Lockwood Smith last night denied it was a loophole and said he was happy for the practice to continue as long as the rent they claimed was based on an independent market valuation.
Tisch, a former management consultant and company director who is the electorate MP for Waikato, has since moved out of the apartment, but also noted in his pecuniary interests that he received directors fees from the company. However, he said he had since checked and had not received fees.
Related Topics
It seems MPs can own the apartments and pay full market rents to themselves as long as they're not repaying any of the mortgage and as long as they have set up a front company.
MPs from out of Wellington can claim up to $24,000 a year allowance for rent, board or hotel costs.
If they own a property in their own name, they can use the allowance to service interest on a mortgage but not to pay off the principal - so if the mortgage is paid off or low, they no longer receive payments.
A Parliamentary Services spokesman said this was because paying off the principal was not deemed an "actual and reasonable" expense under the Speaker's Directions.
However, MPs can set up a front company, or put the property in a trust or superannuation fund and claim full market rent.
Dr Smith said a change in the rules he introduced this year to require that MPs with an interest in a property got an independent valuation of the rent "protects taxpayers".
He said it was "not an unacceptable practice" to channel the money through a company or trust.
Mr Tisch lists the company - Heritage 653 Limited - on the MPs' register as a "property investment company".
My view
No wonder National (or Labour for that matter) are so reluctant to change the rules around property investment. It seems many MPs and ministers know exactly how to extract the best out of both the taxpayer and the tax system.
The hypocrisy is appalling. On the one hand we have the government saying the economy is unbalanced and New Zealanders have over invested in property and under invested in the productive sector. On the other hand they are personally investing in property and using the taxpayer to reduce their risks and generate tax-free capital gains.
We reported in August last year about how over half of MPs in parliament before the election use family and other trusts. Nine MPs declared ownership in rental properties, although many of the trusts will also own properties which do not need to be declared under the current rules. Labour is not much better. When I asked Labour MPs at the banking inquiry how many had LAQCs, at least a third put up their hands.
This is symptomatic of a fundamental problem. Those people running the country have become personally rich from the doubling of property prices between 2002 and 2007. Yet that underlying shift in the economy is handicapping New Zealand's ability to grow faster, to raise real incomes and to keep Generations X and Y from buying one way tickets to somewhere else with higher incomes and affordable property.
This tendency of the baby boomers (Lindsay Tisch graduated from Lincoln University in 1974) to protect their capital gains is coming at a cost to them and New Zealand. They are having to watch their grand kids grow up overseas.
Here's some detail from Tisch's profile on his website.
Lindsay and Leonie (Tisch) enjoy music, the beach, travel and walking. They have two adult children, a daughter in London and a son working in the hospitality industry in New Zealand.
Is this really what we want New Zealand to become: a nation of retired landlords that watch their grandkids grow up by Facebook?
Your view? I welcome your thoughts and insights below.
43 Comments
Give that man a 20%
Give that man a 20% pay cut.
LOL........pigs in the trough.... "The
LOL........pigs in the trough....
"The hypocrisy is appalling" I couldnt agree more....he's done nothing wrong (apparantly)....nothing illegal; no, amoral; yes....
Long may the news show these guys up
Theiving B%$tards
Theiving B%$tards
Key asleep at the helm...crew
Key asleep at the helm...crew rorting the passengers...iceberg approaching from the south...
@RW; 100% pay cut....he should
@RW; 100% pay cut....he should be sacked from Parliament
regards.
and these are the ppl
and these are the ppl we vote in...
regards
<i>“It doesn’t matter whether it’s
"It doesn't matter whether it's going in there [his company] or going to my paying to Joe Bloggs down the road," he said.
And I suppoose we can assume it's a loss making company?
The point I was trying
The point I was trying to make is the really big rort is in public sector pay and this is far, far bigger than this stuff.
This news item is very small potatoes in itself and serves as a major distraction from the core problem. It is however indicative of the "I work hard, I deserve it" mentality which is endemic in the public sector.
The private sector has some limits imposed by what its customers will pay, but not so the public sector. Time to solve the core problem and stop playing games.
I wonder if Lindsay Tisch
I wonder if Lindsay Tisch felt any little twang in his conscience when Bill E was getting roasted?...
Maybe John Key could rent one of those confessioal boths fm the Pope... Oh wait a minute, weve probably got enough volume to justify purchasing outright.
Who do you TRUST with
Who do you TRUST with your country.
I KNOW WHO I DO NOT.
It is all of them.
Each and everyone is being systematically ROBBED by the ROBBER BARONS.
And you elected them too.
MISS-MANAGED to HELL-en back.
Why BOTHER changing GOVERNMENT, if they are ALL the SAME rorts being perpetrated.
Well the NEXT time you VOTE, wake up.
Only VOTE for someone who does not maintain the status quo and these rorts.
You have the opportunity, for the LAST time at the next election.
JOHN KEY is not the SOLUTION, just perpetuating more of the same dis-hone-STY.
PIGS IN SPACE.....and the space is YOURS, but you do not BENEFIT.
Cos you keep a paying.....they keep a winning....when we should ALL be WHINING. ...and every day until it ENDS at the NEXT election.
Wakey Wakey.
SoreLOser, How coME YOU write
SoreLOser, How coME YOU write like THIS ? It distracts FROM the interESTING things YOU have to SAY and i NOW hardly BOther to read WHAT -YOU have to say AnyMOre.as IT takes TOO much EFFORT.
I wonder... What if someone
I wonder...
What if someone would get a citizen initiated referendum on introducing a new law that stops all and any type of property related subsidy, and while we are at it, deal with other perks too!
What if politicians would get a simple decent salary, and a strict, clearly defined travel assistance, such as economy fares incl. a partner if travel undertaken is 100% business. Any combined personal travel as part of official business gets pro rata deducted based on days spent on private travel. Keep it simple. And if that does not work, cut it out alltogether. Fair enough? That would stop a lot of hopping around the world and many other ills...
We have made this world far too complex and open to misuse, it's time to go back to KISS principles. I would be very happy to contribute financially to a campaign that will achieve that goal.
OK.....PoInT ...taken.
OK.....PoInT ...taken.
Come on guys, get real....everything
Come on guys, get real....everything he did is legal. If my company pays my rent, I would do the same. The problem is not how he did or what he did. The point is the very people we trust to do thing correctly is writing laws to enable them to do things "legally".
So do we really believe that politicians have the interest of the country and it's "ordinary" people at heart ??....it's TUI time...
Oh I see from Linsaday's
Oh I see from Linsaday's National Patry Biograpghy that he has form...
"Before entering Parliament, Lindsay was a self-employed management consultant and company director, specialising in restructuring, refinancing "
http://www.national.org.nz/Bio.aspx?Id=43
... and theres an email address for him... Lindsay.Tisch@parliament.govt.nz
If you don't like way he does Business... write to him and tell him so.
This just underlines the rot
This just underlines the rot is at the top,no matter whos in power!!
Actually this is all a
Actually this is all a bit of a mistake... the problem is Lindsay Tisch is a little hard of hearing.
When John Key said "You are here to Serve the public"... Lindsay thought he said "You are here to SERVICE the public.
Very well put Bernard. You
Very well put Bernard. You are exposing a massive underlying problem, namely the absolute conflict of interest of those in power. Do note that this goes much, much further than issues such as capital gains tax, or perks. The simple fact that the troughers use their perks to rort the system to go into real estate, also means that they have a very direct interest in ever rising real estate prices. Any changes to the RMA or the regulatory regimes that would stimulate development and thus increase volume and decrease price, runs against their PERSONAL interest.
In other words, with so many politicians playing the real estate investor, they cannot be trusted to even properly run the regulatory system. This problem of course runs through all levels of local authorities as well, do you think a CEO or planning manager in a smallish town will be enthusiastic about a huge development starting that will push the value of his house down by say 20%? Of course not, i.e. the system is fandangled within itself.
A Justice of the Peace.
A Justice of the Peace. No wonder New Zealand is in such a parlous state.
The vested interests have their own perverted sense of justice.
When will New Zealanders wake up to the fact that Animal Farm is here and now.
George Orwell was writing about the NEW ZEALAND we all deserve.
Dick Turpin had nothing on
Dick Turpin had nothing on these thieves. Yep, it may be legal, but.... It's about time this was tidied up and the lolly jar moved to the top shelf out of reach.
How these people can pocket those dollars on one side of their face and show pretend and deep concern for the country on the other side is beyond me.
Why are politicians usually so short? So would you be if you were that darned crooked and bent
As far as I am
As far as I am concerned I think that the whole lot of them in Parliament are just pigs wallowing at the trough sucking what they can out of the system. These are type of people you would not like to be in the company of of. Distasteful little parasites! No wonder society is going down hill as the years go by.
The power rests in the
The power rests in the selection process. If you want to ruin these guys, become a national party member turn up at the AGM and vote the bastards out. Who you replace them with is a big question. The choice is not always that exciting,often these guys are just the best of the bunch, eventually it goes to their heads and they believe they have a destiny to fulfill.
Every morning they get up and look in the mirror and say it could be me I could be prime minister and do a great job get knighted and all the rest. The reality is that we have about as many people as a city like Manchester and the spending policies of our Govt fail to reflect this fact.
It is all of us at fault here we fail as citizens to get involved in one of the great rights bestowed upon us in a democracy.
I saddens me to attend a political party AGM and find that 20 people are going to choose the candidate and the choice is between so few. To finish me off the MP's then proceed to follow the party line even when it is so obviously not in the electorates best interest. If you wished to turn up at an AGM with 30 people you could completely change the make up of the major political parties and get their attention big time.
We all are happy to support policy as long as we believe we wont have to pay for it. The ETS that Nick Smith pushed through is an appalling piece of legislation a new low in pork barrel politics. If enough people in Nelson turn up to the AGM during selection and biff him out believe me the rest will take notice.
@Mouse, Na, wrong word, "SCREW".
@Mouse, Na, wrong word, "SCREW".
regards
"The power rests in the
"The power rests in the selection process."
Correct they get to choose the bums and stiffs we vote for.
"If you want to ruin these guys, become a national party member turn up at the AGM and vote the bastards out."
yeah right....the party faithful know full well their power rests on that not happening...
regards
Steven, Ive been there, believe
Steven,
Ive been there, believe me a small number could change the outcome. Its always been a glaringly obvious weakness. It up to the people who care, to front up take the time to get meaningful change,it's the person looking back at you in the mirror who has caused the problem and who has the power to fix it.
Lindsay did it because he
Lindsay did it because he is allowed to. Get another guy into his position won't change the situation at all.
This only solution is to change the rules and the system.
---- but look who is the law-maker....
The system is rotten to
The system is rotten to the core.
Has anyone confirmed if he
Has anyone confirmed if he was claiming the loss for tax purposes similar to Ms B:
http://www.interest.co.nz/ratesblog/index.php/2009/11/26/have-your-say-l...
Could be interesting if he did.
AndrewJ: agree with you totally,
AndrewJ:
agree with you totally, problem is just, are there any persons/personalities/individuals who have the ability/trustworthiness/public standing - to be nominated instead?
Mostly people have to work for years in the cadre of a party before they have any chance to climb up the ladder.
What do you think how this could be changed?
Jeez you're really a nice
Jeez you're really a nice bloke Walter...I'd liken this political system to a turd in a punchbowl. The punch had so much promise...an award winning nectar of the gods...then along came the turd.
Gertraud T Believe me, if
Gertraud T
Believe me, if a group of people got together it would not take much to give standing candidates one hell of a fright and create real change. The fear of losing ones seat may lead to some actually standing for something instead of just towing the party line.
I was horrified when I went to see Stephen Joyce talk, an ex travel agent now in cabinet with the Transport portfolio. He told us what he intended to do and you could take it or leave it. I was finally moved to say something when he advocated letting local councils issue bonds, collectively running into the billions to help us get through the recession and to develop infrastructure. I told him that he was asking for civil disobedience and was completely out of touch with the electorate. I was heartened when the party president came to me afterwards and agreed with my stance telling me, rates were a major point of contention for her and her husband.
Id bet we see a move by the politicians to close a loophole in MMP. This is were an outsider captures a common cause and gets a massive amount of support. I think that with unemployment rising and immigration a sore point for many,(including a policeman friend who said he now spends hours dealing with low quality immigrants from Africa who are professional criminals and who qualified for refugee status so they could continue their profession here)Winston Peters has the chance to seriously challenge the establishment.I mean really were his sins any worse than the others? He was hung to dry by the very MP's who now have the dirt all over them. In a proportional system this is a potentially destabilising possibility. Maybe a welcome one.
Oh god......Winston Peters.....please no...
Oh god......Winston Peters.....please no...
All this talk of capital
All this talk of capital gains is making me sick. The fundamental figure when investing in rentals is the rent it can return. The sooner that people realise that rent can not go up at the same rate house prices has the better.
If rent can not rise (due to the limitation of wages), then any property rises in excess of that mean that people are investing in property purely for the reason that the price will increase. The property market is a bubble in my opinion. A bubble that is clouded by tax rules. The tax rules are just allowing the bubble to grow larger, un-noticed.
Everyone is making it sound like the baby boomers are going to retire rich landlords. I think the property market bubble is going to pop when the baby boomers try to access their capital.
Think about it. NZ is doing poorly at savings, but has a high property market. Where has NZ savings gone? Now if many baby boomers are left with no savings, but lots of houses, they are going to have to sell their rental properties to get cash flow. How many properties could be put on the market before the market goes down.
I think investing in rest homes is a safer bet than the property market.
this really is disgraceful as
this really is disgraceful as is the speaker's acceptance of these practices
they must be revised to a more acceptable level
but who could do this -remuneration authority?
surely polies care about the growing public distaste ?
The shenannigans of National &
The shenannigans of National & the Maori Party , plus Goffy's " Orewa " race-card speech , Hone Harawira , these are grist for the NZ First mill . Winston will seize on this with glee , and return , little changed nor chagrined . New Zealand , be prepared for the truimphal return of the King of Kiwi politics ( now you understand just how parlous it has sunk to ) .
Parlous State in-deed....and in fact.
Parlous State in-deed....and in fact.
I personally would rather dig up the older WINSTON and import him from UK.....we have a potential WAR state on our hands. He would be better dead than Winnie alive.
Churchill would have a big cigar, so maybe we could bring back Clinton too in USA. At least he got a head.
No one has yet suggested digging up MULDOON, we gotta think big.
Seriously... what next.
"We reported in August last
"We reported in August last year about how over half of MPs in parliament before the election use family and other trusts. Nine MPs declared ownership in rental properties, although many of the trusts will also own properties which do not need to be declared under the current rules. Labour is not much better. When I asked Labour MPs at the banking inquiry how many had LAQCs, at least a third put up their hands."
Well only 6 per cent of Kiwis have one or more rental property. Bernard's right: the hypocrisy and self-interest of MPs in this area is appalling. National has taken up Labour's legacy with enthusiasm. Labour squandered its children's future: how dare Phil Gof try to take the high moral ground. He should hang his head in shame.
@ruru, agreed. They are all
@ruru, agreed. They are all as bad. Problem is, they won't be changing their ways anytime soon, and changing them for other people is more hard than you'd think in our system. Plus, the sad thing is, we as NZ society are so dumbed-down they know they don't need to change that much at all, if at all. Add to that the general collusion of well-heeled SPIs spread across society where it counts, eg. MSM and professions, and what hope for change is there? Bugger all in my view.
It seems the general population
It seems the general population about 5 or 6 % of people have secondary property, MPs this is somewhere between 55 and 60% - stop wondering why property has such special status in NZ.
I wonder what this looks like in the senior ranks of the civil service? Like to bet?
ruru, Jacko, John - as
ruru, Jacko, John - as Selwynnoted here:
http://www.interest.co.nz/ratesblog/index.php/2009/08/05/have-your-say-h...
common on both sides of the house, plus you make a good point John about the Sir Humphrey set.
So I agree with Jacko, a high probability of bugger all hope for change. NZ is what it is, a property based tax haven.
I too really can't see how it will change?
Winston will change it ,
Winston will change it , Les . Offer a few beads and baubles , and the never to be forgotten " King " of Kiwi politics shall return.............And give us a whole new set of things to shake our heads in wonderment about ! Joy , joy , joy !
We can see what the
We can see what the TWG comes up with next week, Bernard will be there twittering away, (wish my blog was ready - grump, but I will be trying twitter).
Gordon Sutherland and others from the NZMEA will be there it really is hard to maintain credibility claiming dispassionate analysis when the real reason is vested interest.
We will see. Hope ca, for now, triumph over experience.
Let us pray , John
Let us pray , John , that this lot don't dismiss the TWG with an off-hand " ideological burp " comment , as Cullen did to Treasury reports . Or just pretend that is isn't there , as he did to the McLeod report on taxation . I'm not religious , John , but I'm doing a spot of praying now !