Over half our MPs have interests in trusts

Over half our MPs have interests in trusts

John Key and Helen ClarkThe use of family and other trusts to minimise payment of the new 39% tax rate has boomed over the last 7 years, as have investments in rental properties where losses can be claimed against personal income tax. So we thought it would be interesting to see how many parliamentarians and government ministers had arranged their financial affairs using trusts or had invested in rental properties.

We found that over half of the current 121 members of parliament declared interests in family and other trusts, while 9 declared ownership in investment or rental properties, although it is possible the family trusts owned rental properties in their own right that did not have to be declared.

Both Prime Minister Helen Clark and Opposition Leader John Key use family trusts, while Clark also owns 5 houses, including at least one investment property. Key owns commercial property directly and also has shares in a property firm. National MPs are heavier users of trusts than Labour MPs, but both are significant investors in residential property.

From 2006, Members of Parliament have had to register their pecuniary interests at the beginning of each year. It was believed that the register would help to highlight and avoid conflicts of interest between the public duties and private lives of MPs. Although the introduction of the register went some way to opening up MPs' interests to the public, there are still a number of ways MPs can cloak certain interests such as property ownership.

For example, if a member's spouse owns the property, then it doesn't have to be listed that the MP has an interest in it, said Liz Walcott of the Registrar of Pecuniary Interests of Members of Parliament. MPs don't have to list property if the property is owned by a trust.

This was highlighted in July when the Herald ran a story on National leader John Key's property ownership. Key's properties in Hawaii, London and New Zealand did not have to be listed on the register as they were owned by his family trust. Helen Clark, who listed two family trusts, seperately listed five properties, including an investment property in Rodney and a house in the UK.

More than half of New Zealand's MPs declared that they had beneficial interests in trusts according to the 2008 Register of Pecuniary Interests of Members of Parliament. Of the 67 MPs with interests in trusts, there were 37 from National, 20 from Labour, five from New Zealand First, two from the Maori Party, and one each from United Future, ACT and the Greens.

There were 42 MPs who declared that they had interests in family trusts: 24 of National's 48 MPs, 13 from Labour's 49, three from New Zealand First's seven, and one each from United Future (2) and ACT (2).

A total of 53 MPs listed that they had interests in two or more categories of real property (Labour: 23, National: 19, Greens: 3, NZ First: 3, Maori: 2, Independent: 2, United Future: 1).

MPs decide individually on how to categorise a property on the register as there are no set definitions of what constitutes certain properties, such as 'investment property'. "There are no specific definitions of how to list a real property," Walcott said. "It's up to the individual to decide."

Nine MPs listed that they have interests in 'investment' or 'rental' properties under the real property section of the register.

There were 26 MPs who did not list any property interests, but did list that they had interests in trusts. Of these, 18 were National MPs, six were from Labour, and there was one each from NZ First and ACT.

The register also asked MPs to list whether they had company directorships and controlling interests, or interests (such as shares and bonds) in companies and business entities. There were 27 that listed companies associated with property investment or investment in general: 17 were National MPs and six were from Labour. There was one each from NZ First, the Greens, ACT and independent MP Taito Philip Field.

Here are a few examples of listings on the register - (1) represents company directorships and controlling interests, (2) represents interests (such as shares and bonds) in companies and business entities, (4) represents interests in trusts, (6) represents interests in real property.

David Carter (National, List) (2): Alliance Group limited - licensed meat exporters; Doone Partnership "“ farming operation; Guinness Peat Group p/c "“ public company; NZ Wool Services International Ltd. "“ wool exporters; Primary Producers Cooperative Society Ltd. "“ licensed meat exporters; Ravensdown Fertiliser Co-op Ltd. "“ fertiliser company; Hauraki Private Entity No.2 Fund "“ public investment; Wool Equities Ltd. "“ public company; CBS Canterbury "“ building society; Collateral Mezzanine (NZ) Fund 05 "“ public investment. (4): David Carter Family Trust; Doone Trust; Maurice Carter Family Trust. (6): Farm property, Banks Peninsula; Farm property, North Canterbury; House, Marlborough Sounds; Apartment, Wellington.

Helen Clark (Labour, Mt Albert) (4): Burke Family Trust; FG Clark Family Trust. (6): House, Auckland; Town House, Wellington; Apartment, Christchurch; Investment property, Rodney; House, UK.

Michael Cullen (Labour, List) (6): Family Home (jointly owned), Napier.

Taito Phillip Field, (Independent, Mangere) (1): T.P. Field Developments Ltd. "“ investments. (6): Family home, Mangere, Auckland; Apartment, Wellington Central; Rental house, Mangere, Auckland; Rental units, Mangere, Auckland x2; Rental house, Manukau, Auckland; Family home, 1 acre (jointly owned), Afiamalu, Samoa; Half acre of land (jointly owned), Viatele, Samoa; Two acres of land (jointly owned), Aleisa, Samoa; Half acre of land (jointly owned), Letongo, Samoa.

Jeanette Fitzsimons (Green, List) (1): Aeolian Property Company Limited "“ property management. (2): Fletcher Building Limited; Cavalier Corporation Limited; Fisher & Paykel Appliances Holdings Limited; Fisher & Paykel Healthcare Corporation Limited; Scott Technology Limited. (6): Family home (jointly owned), Kauaeranga Valley, Thames; One-fifth share in relative's home near Kawhia.

Shane Jones (Labour, List) (2): Castle-Rigg Limited "“ property investment; Victoria & Benecia Limited "“ property investment; Kamo Properties "“ property investment; JONDAC Limited "“ property investment. (4): Te Puna o Te Anaru Trust; Castlerigg Trust. (6): Property, Springs Flat, Whangarei; Property, Maimaru, Awanui, SH10, Tai Tokerau.

John Key (National, Helensville) (1): Earl of Auckland "“ commercial property. (2): Little Nell "“ property investment; Merrill Lynch "“ investment banking; Jackson Mining "“ gold mine. (4): JP & BI Key Family Trust.

Winston Peters (NZ First, List) (4): WRP Family Trust. (6): Land, Whananaki South; Property, Rawhiti, Bay of Islands.

Lindsay Tisch (National, Piako) (1): WL and LM Tisch Limited (not trading); Heritage 653 Limited "“ property investment; Tisch Properties Limited "“ property investment. (2): Paladin Limited "“ property investment; Tower Limited "“ insurance. (6): Family home, Matamata (presently being constructed); Apartment, Wellington; Apartment, Mt Maunganui; Interest in property, Mission Bay; Interest in property, Lake Rotoiti.

Chris Tremain (National, Napier) (1) Tremain Holdings Limited "“ investment; Tremain Real Estate Limited "“ real estate sales; Tremain Developments Limited "“ real estate development; MSC Limited, formerly called Wine Country Homes Limited trading as Jennian Homes (HB) "“ new home building; Waipatiki Developments Limited "“ land development. (2) Sunset Investment Partnership "“ retirement investment in shares, commercial and residential property; The Provincial Club Limited "“ investment in shares and fixed interest deposits. (4) The Estate of KR Tremain; The KR Tremain Family Trust; CJ and AK Tremain Family Trust; CJ Tremain Development Trust. (6) Investment property (jointly owned), Hastings.

What are your views? Should New Zealand's MP's be placed under further scrutiny by having to list what they own in trusts? What if a member's spouse owns property or has controlling interests in a company? Do most of our politicians have a conflict of interest in any debate about the use of trusts to minimise tax or the current regime encouraging investment in rental properties to reduce personal tax?

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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