Stuff.co.nz
11 December, 2010
by Tracy Watkins, Martin Kay, Vernon Small

Pansy Wong resigns Cabinet over travel perk

Embattled former Cabinet minister Pansy Wong may have to repay thousands of dollars in travel racked up on her taxpayer-funded travel perk. Speaking to reporters in Japan after news of Wong's resignation this morning, Prime Minister John Key said Wong may be in line to repay thousands of dollars in inappropriate spending from her 2008 trip to China with husband Sammy and there "could potentially be more".

Key confirmed Wong offered him her resignation last night and he "accepted it without hesitation". If she had not offered her resignation he would have sacked her, Key said. He confirmed an investigation into Wong's spending was triggered by questions by Fairfax media.

Key said he was informed today that Wong had used her parliamentary travel entitlement to pay for parts of her husband's travel in China in late 2008 where he conducted private business.

"On the face of it, this is a breach of travel entitlement rules and Mrs. Wong has been unable to assure me it is a one-off breach. I expect high standards from my ministers and I believe that Mrs. Wong has taken the appropriate step in resigning. It is important that MPs and ministers treat taxpayer money with the utmost respect."

Speaker of the House Lockwood Smith had launched an investigation into both the travel claim in question and previous use of the international travel rebate by Wong. "I am not going to pre-judge the outcome of this investigation," Key said.

Wong said she had failed to live up to the high standards set by Key and had resigned as a minister. "This action follows questions about use of my parliamentary travel entitlement to pay for my husband to travel within China at the end of 2008. Although the trip was a holiday, my husband did conduct some business. Further, I am not able at this point to give the Prime Minister an assurance that this is a one-off situation. As a Member of Parliament it is my responsibility to ensure that the travel entitlement is used within the rules and that does not appear to be the case on this occasion. Given that, the appropriate and honourable thing to do is to offer my resignation to the Prime Minister."

She had asked Dr Smith to review her use of the travel perk and would make a full refund if it was outside the rules. Dr Smith said he was advised of Wong's resignation this morning and the questions about her use of the travel perk.

"It is vitally important that taxpayer money is being used properly. All parliamentarians have a responsibility in that respect. Mrs. Wong has asked for me to investigate this issue. I have, therefore, asked the general manager of the Parliamentary Service to undertake urgently a full investigation of Mr. and Mrs. Wong’s use of the international travel rebate. In the event that there has been misuse of this entitlement, Mrs. Wong has made it clear she will undertake full repayment. I will not be making any further comment until this investigation has been completed."

Documents from the trip in question show Wong signed herself as a witness to a business deal of her husband's that later turned sour. She signed herself "Minister of NZ Govt", and her address as "Parliament Buildings, Wellington NZ", when she witnessed a contract between Pacific Hovercraft NZ and China-based Lianyungang Supreme Hovercraft during the trip.

Sammy Wong is named as a co-director of Lianyungang Supreme Hovercraft. Lawyers' letters show Lianyungang Supreme Hovercraft is being pursued for $800,000 in royalties and other entitlements.

Labour MP Pete Hodgson, who first raised the signature issue on Tuesday, said Key had handled the affair badly. Initially, a spokesman for the PM said Cabinet rules against conducting personal business as a minister had not been broken as Wong only witnessed the deal and was required to put her occupation. The spokesman said Hodgson was a "f…wit" and Key and Deputy Prime Minister Bill English dismissed the allegations as muck-raking.

Hodgson said the fact Wong now admitted misusing the travel perk showed Key had failed to properly consider the issue.

"She was unable to confirm that she hasn't repeatedly abused privilege and so Key has done the right thing, but belatedly. This is after a week of repeated denial followed by a bit of personal abuse aimed at both the media and the Opposition from Mr. Key, from the Deputy Prime Minister, from the Prime Minister's staff, so it's not been a good week for the Prime Minister, and it is never a good look to try and bully the Opposition or the media into submission.

“So long as the allegations are reasonable, I think the Prime Minister is obliged to treat them seriously. He didn't in this case, and that is why he has got egg all over his face,'' Hodgson said.

On current prices, a ticket to China can cost between $2500 and $5000-plus one way when flying business class.

As a 14-year veteran of Parliament, Wong qualifies for the gold-plated travel perk scheme - including a lifetime entitlement to subsidised travel for herself and her spouse. The subsidy is worth 90 per cent of the international travel fare payable on both her own and her husband's fares. Spouses are entitled to the same subsidy as their partners if they are either travelling with the MP or planning to join them overseas.