The biggest benefit is that it's effectively impossible to bribe politicians because their lives are all lived in an identical and fixed fashion. You can't offer a senator a Ferrari because the senator couldn't drive it. They just go around in the resort shuttle, like all the other senators.

Picture if someone said: You get to live the rest of your life at this hotel, for free. There's a spa, a buffet, a pool, grounds for walking (None of these facilities are super nice, just picture like a small-time country club). Your immediate family can live with you. Etc. And on top of that, you get to shape policy for all the citizens of your country however you want. For the average person that is an amazing deal. You are guaranteed an early retirement and all your needs taken care of.

Now realize, for many of our worst political figures, this life is a downgrade. They don't get to have thirty cars, some boats, a small castle in France, a penthouse in Tokyo, a private chef, prostitutes, drugs, child sex slaves, etc. Of course I know the average senator isn't living quite that expensively, but I think a lot of them want to be and that goal is what has them relentlessly chasing more money.

By putting them in this environment, you not only remove any need for them to have money, you also remove the temptation and appeal of corrupted power. But meanwhile, for the typical person who truly wants to help the citizens be better off, the arrangement is extremely appealing. A lot of activists work to improve the world at sacrifice to their own well-being, so the sacrifices (a wide variety of restaurants, traveling, living wherever you want...) are surely worth it to them in exchange for being able to make a difference.

While we're on the topic of activists, it's worth discussing extremists. This plan doesn't prevent against True Believer extremists, so it's not perfect. In fact if we make the resort too shitty, like an actual prison, then only extremists will find it worthwhile to live there, which is also bad. That's why it still has to be fairly nice. In fact, the quality of life should probably be roughly tied to the median quality of life in the country - which is why the OP hits so right. But as we all know, the salary a person is paid doesn't really matter as much as how they live, and for powerful people the gulf between those things is huge. Hence, we need to go straight to the source and mandate the lifestyle of the powerful.