The cost of living crisis is being felt worldwide - but compared to the salaries of top global leaders, Kiwi politicians probably won't be feeling the pinch.
New Zealand prime ministers have, in recent years, frequently landed among the highest-paid world leaders. Even locally, the newest backbench MPs here earn almost three times the median salary of New Zealanders.
Although New Zealand politicians haven't had a pay rise in five years, their remuneration still lands them among the country's top earners.
So how do MPs in New Zealand compare to their overseas counterparts - and where does their salary land them in comparison with other Kiwis?
How New Zealand politicians' salaries compare
In New Zealand, the Remuneration Authority reviews and sets MPs' pay. It also sets a basic allowance for MPs and determines their superannuation.
The amount of remuneration varies depending on what other offices MPs hold, such as the roles of Prime Minister, ministers, Speaker, and leader of the Opposition.
For example, the current base salary of an MP is $163,961, while a Cabinet Minister receives $296,007.
And earning $471,049 annually, Prime Minister Jacinda Ardern is among the top-earning world leaders. Ahead of her are just six others (currency conversion rates are accurate as of January 5):
1 - Lee Hsien Loong
- Title: Prime Minister of Singapore
- Salary: SGD$2.2 million (NZ$2,612,192)
2 - John Lee
- Title: Hong Kong chief executive
- Salary: HK$452,200 per month, HK$5,426,400 per year (NZ$1,105,376 annually)
3 - Ignazio Cassis
- Title: President of the Swiss Confederation
- Salary: CHF 456,854 (NZ$783,428)
4 - Joe Biden
- Title: President of the United States
- Salary: US$400,000 (NZ$636,676)
5 - Anthony Albanese
- Title: Prime Minister of Australia
- Salary: A$564,364 (NZ$611,651)
6 - Olaf Scholz
- Title: Chancellor of Germany
- Salary: €30,189.81 per month, €362,268 per year (NZ$612,161 annually).
When setting MPs' remuneration, the Remuneration Authority has to consider the requirements of the job, any adverse economic situations, needing to be fair to both the person whose pay is being set as well as the taxpayer, and other criteria.
Geoff Summers, the chair of the Remuneration Authority, told Newshub that since politicians serve the public, they look at public sector wages to see how they're moving and they take that into account. Taking the public sector stance means they're looking at it conservatively, since private sector pay tends to be higher.
A pay freeze at the end of 2020 was a result of COVID-19 - an adverse economic situation - and a recession would also impact any pay rises, Summers said. The cost of living isn't taken into account because "general inflation and wage inflation have very little correlation".
"We don't take, specifically, the cost of living into account because it can really create quite a distortion. What we're required to do is the six criteria in the Act."
Ultimately, the Authority doesn't make any mechanical formulaic decisions.
"With all the client groups that are given to us … what we do with all of them is that we have a regular meeting every week and at that meeting, whichever client groups we're working on at the time, our analysts and executive director will bring some data to the table and we have a really big, long discussion about it and we try to use a responsible judgement call based on what the law requires us to do," Summers said.
"We don't take any notice of public perception [of how much MPs get paid], because public perception includes public prejudice, and we're not set up to take anything like that into account. What we do is we look at what they're paid now, we look at the six criteria in the Act, and we try to make a judgement call that's fair and legitimate as far as those six criteria are concerned."
The law states the Remuneration Authority must begin a review of MPs' pay within three months of the writ being returned after the election. Until then, the Remuneration Authority can't do any work at all on MPs' pay - not even preparation.
Along with salary, the Authority also decides how much MPs get for work-related travel, accommodation, and similar expenses.
Summers said MPs here used to get plenty of perks - but that isn't the case anymore.
"In New Zealand, the only thing you could call a perk that MPs get is a generous contribution from the Government to their superannuation scheme. So they get 20 percent of a backbencher's pay as a contribution to their scheme."
In a nutshell, Summers said all that politicians here get is their salary and superannuation. Everything else they receive is what any employee would get for doing their job, he added, such as business-related flights getting reimbursed.
MPs' pay hasn't changed since mid-2017 and is currently frozen until the end of polling day for the next general election.
Newshub contacted the five parties currently in Parliament, asking if they thought politicians here are paid fairly compared to other countries. Only the ACT Party responded.
Leader David Seymour told Newshub it's important Parliament has a range of MPs.
"For some it's the best job they'll ever get, others will take a pay cut to do the job they love. That wouldn't really change if you doubled or halved the salary."
Despite what will be a six-year-long pay freeze when it comes time for the review, a backbench member of Parliament with no additional responsibilities earns considerably more than some MPs in comparable countries.
Canada
While Canadian prime ministers earn less than those in New Zealand, backbenchers there earn significantly more than their Kiwi counterparts.
A member of the House of Commons earns CA$189,500 (NZ$223,149), and Justin Trudeau earns this amount plus an additional salary for his job as Prime Minister, bringing his total to CA$379,000 (NZ$446,299) a year.
United Kingdom
British Prime Minister Rishi Sunak is entitled to £161,401 (NZ$308,726). This is split between the salary for the role of prime minister, which is £79,496 (NZ$152,059), and his role as an MP.
The basic salary for a MP over there has crawled closer to New Zealand. Now, the basic annual earnings of a MP is £84,144 (NZ$160,949), as of April 2022.
Australia
As mentioned above, Albanese ranks in the top five highest-paid world leaders, earning A$564,364 (NZ$611,651) per year.
After a pay rise earlier this year, the leader of the Opposition now earns about A$401,000 (NZ$434,599) and an average backbench MP is on A$217,060 (NZ$235,247), plus their allowances.
United States
In the US, Biden's yearly earnings bring him among the top earners, at US$400,000 (NZ$636,676) a year.
Both senators and members of the House of Representatives earn US$174,000 (NZ$276,954) annually. Those who hold roles including Speaker and Senate majority and minority leaders earn slightly more.
Members of the Senate haven't had a pay rise since 2009.
How do NZ politicians' salaries compare to other jobs in New Zealand?
There was once a time when backbench politicians and teachers were paid a similar salary. However now that gap has ballooned and now there's a 423 percent difference between the maximum salary for teachers and what the prime minister earns.
Melanie Webber, president of the New Zealand Post Primary Teachers' Association Te Wehengarua (PPTA), told Newshub in 1976 teachers were paid $12,370 and a backbench MP was paid a total of $14,097 in salary and allowances.
Now, an experienced secondary teacher has a salary of $90,000 while the lowest-paid and "most inexperienced" backbench MPs get $163,961.
But it's not only against MPs' earnings that teachers' salaries have fallen. Webber said in 1978, an experienced secondary teacher would earn more than twice the average weekly income. However, today they earn about 50 percent more than the average weekly wage.
She added that it isn't a matter of politicians "being paid too much", rather it's about how wide the gap has grown between secondary teachers' current salaries and the conditions that are needed to recruit and retain secondary teachers.
"We have a worsening shortage of subject specialist teachers in our high schools. If we don't improve the pay and conditions, more teachers will leave and the quality of secondary education for a generation of children will be seriously compromised," Webber said.
There's also a sizable difference between what MPs and New Zealanders earn. According to the latest data from Stats NZ, the median weekly earnings for Kiwis is $1189, or $61,828 annually. This means there is a $102,133 difference between the lowest-paid MPs and median New Zealanders.
Out of the average salaries of the highest-paying jobs in New Zealand, the yearly pay for a general practitioner is the only role where people are paid more than backbench MPs. GPs receive an average salary of $182,022, according to data from Seek.
The second and third places for the highest average salaries are both information and communication technology roles: change manager ($157,723) and architect ($155,006).
