Entitlements for former prime ministers should not be decided at the "whim of individual PMs", according to independent Senator Nick Xenophon, who has called for greater transparency around politicians perks.

Senator Xenophon on Wednesday praised Prime Minister Tony Abbott's unwinding of extra entitlements former Labor prime ministers Julia Gillard and Kevin Rudd granted each other after their respective takeovers, but said a better system should be in place to assist former leaders.

Documents show Mr Abbott unwound more generous staffing and travel arrangements granted to Mr Rudd when Mr Abbott won office, to bring them into line with entitlements for former prime ministers John Howard, Paul Keating and Bob Hawke.

Under the current system, new prime ministers sign off on the entitlements granted to their immediate predecessors.

The correspondence, which was subject to a Freedom of Information request, shows Ms Gillard granted Mr Rudd an extra staffer and unlimited domestic travel, days after she deposed him in 2013.  Mr Rudd returned the favour in 2013 when he toppled her leadership.

Mr Abbott began winding back the boosted entitlements in October after Mr Rudd had lost office but remained in Parliament, but when Mr Rudd quit politics in November his entitlements were entirely wound back to the standard package awarded to former prime ministers, in line with official advice.

Senator Xenophon said it was "fair enough" that Mr Abbott had unwound the arrangements and criticised Labor's "top-ups" as a "very bad precedent", which had the potential to destroy public consensus for generous taxpayer allowances for former leaders.

"This sets a very bad precedent and makes it incredibly messy and takes away from the general community consensus for former prime ministers to receive entitlements," Senator Xenophon told Fairfax Media.

"The problem with top-ups is that they are subject to much personal discretion," he said.

In 2010 a review found that "while each former prime minister's entitlements are individually determined by the incoming prime minister, they have come to be largely uniform in nature" and recommended "that a legislated head of authority be created to provide benefits to former prime ministers".

Senator Xenophon said he strongly supported generous arrangements for former prime ministers because they were in high demand to attend events and deliver speeches, but he said there needed to be a better system put in place.

"It shouldn't be something decided at the whim of individual PMs. A bad precedent was set in 2010 and any top-ups should be subject to parliamentary scrutiny, rather than something we learn about after the fact," he said.

A spokesperson for Mr Abbott said the entitlements were in line with what former prime ministers have received in the past.

The spokesperson said: "Prime Minister Abbott approved entitlements for former prime ministers Rudd and Gillard based on long-standing practice for retired PMs and the advice of the Department of the Prime Minister and Cabinet."

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