The Auditor-General says it's unable to investigate a rental arrangement which saw two Labour MPs inflate the cost of their electorate office rent to taxpayers and obtain thousands of dollars of taxpayer money for the Labour Party.
The public watchdog's inquiries manager David Lemmon said it does not have the mandate to determine whether it was a legitimate act for the Labour MPs to do.
Labour MPs Trevor Mallard and Ginny Andersen were paying $1500 a year in rent for their Petone Office in Hutt South from the Professional Firefighters Union, but a subletting arrangement meant they charged the Parliamentary Service $6000 a year - and they kept the difference for their Labour branch.
In March, Andersen told 1 NEWS she inherited the deal from her predecessor Mallard and hadn't fully understood it.
She said as soon as it became public in September last year and she realised what was happening, she terminated the arrangement saying taxpayers deserved better.
In February, the National MP Chris Bishop, who stood in Hutt South, asked the Auditor-General to investigate the matter.
Today the Auditor-General responded saying, "in this case, we do not have a mandate to inquire into the branch’s rental arrangements with the Union or to draw conclusions about the legitimacy of the profit margin between the rent the branch paid to the Union and what it charged to the Parliamentary Service".
"We do not have a mandate to look at the activities of private individuals or organisations in the private sector."
In June 2020 the Auditor-General also received a fraud complaint about the rental arrangement which alleged the MPs had been using a false tenancy to obtain taxpayer money for political campaigning purposes.
On that occasion the Auditor-General accepted the Parliamentary Service's assurance that the arrangement was "value for money".
Mallard is the politician in charge of the Parliamentary Service and he has also repeatedly refused to be interviewed about the rental deal.
The rental arrangement, which has been labelled "dodgy" by Chris Bishop, had been in place since 1993 but the Labour Party says it doesn't know how much taxpayer money its two MPs have obtained in total and is refusing to pay any of the money back.
Andersen has terminated a subletting deal which saw Labour’s Hutt South wing pocketing thousands of dollars of taxpayer’s money each year. (Source: Other)
The Serious Fraud Office received a fraud complaint about the rental arrangement in February 2020 but similarly refused to investigate saying it was outside its remit.
The Prime Minister and Labour Party leader Jacinda Ardern also says she's not the right person to judge whether her two Labour MPs have been taking advantage of taxpayers.
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