Events | 2010.03.29
Second-home allowance and first-class travel scrapped in reform of MPs' expenses
MPs will only be allowed to claim for rented properties under new rules revealed by Sir Ian Kennedy today
The amount MPs can claim in expenses will be slashed by nearly a third under tough new rules published today that will end public subsidies on lavish second homes and force politicians out of first-class carriages in a bid to restore public faith in MPs.
But politicians will still be allowed to employ one partner or family member despite criticisms that some – such as the Tory MP Derek Conway – abused the system by putting spouses and children who did little or no work on their parliamentary payroll.
The Independent Parliamentary Standards Authority (Ipsa) overturned opinion polls and the view of the architect of the original reforms, the chairman of the Committee on Standards in Public Life Sir Christopher Kelly, to rule that there was nothing inherently wrong with the practice. Sir Ian Kennedy, the chairman of Ipsa, argued that employing partners or relatives could be "good value for money".
Ipsa\'s new expenses rules will be brought into force on the first day of the next parliament after the general election and are designed to wipe the slate clean after the scandal that engulfed the Commons last year.
The maximum MPs outside the capital can claim for accommodation and constituency office costs will be £40,957, while the limit for London MPs will be £26,915 – down from £56,915 and £40,192 respectively under the old, now-discredited system.
Every single transaction, contract of employment and expense claim that is rejected will be published online on a weekly basis to make the system entirely transparent. In contrast, a year ago parliament was attempting to conceal details of expenses under the Freedom of Information Act.
Kennedy said that the new scheme would be "fair, workable and transparent".
"No longer will MPs benefit from a slack allowances system. This system brings MPs\' expenses into line with those in most other areas of life," the Ipsa chairman said. "Never again will the public be prevented from seeing how their money is being spent by those who they elect to represent them."
Under the new rules, which will be introduced immediately after the election:
• The second-home allowance will be scrapped, meaning MPs will only be allowed to claim for rented properties. There will be a two-year transition period, after which Ipsa will claw back any capital gains on properties during that period. MPs will be expected to rent only one-bedroom flats up to the cost of £1,450 a month.
• MPs with children up to the age of five (up to 21 for single parents) and those with dependent relatives with a disability will qualify for an additional payment, but Kennedy said it was expected that children would reside in either the MPs\' constituency home or their London property and be separated from their parent for parts of the week. This was opposed by MPs in the consultation who claimed it would prevent those with families, or on lower incomes, standing for parliament.
• MPs will only be able to claim for rent if they live 20 miles from Westminster or more than 60 minutes\' travelling time. A total of 128 constituencies would be exempted – more than had previously been suggested. They will be allowed to claim for the running costs of their second home but not for cleaning or gardening bills.
• First-class travel will be scrapped; MPs will only be reimbursed for standard tickets unless they can pre-book a first class ticket for less than the standard class fare.
• The one-off "resettlement allowance" is to be abolished and replaced with two months\' "winding-down" pay. The announcement could trigger the retirement of more MPs before this election because they will qualify for the "golden goodbye" £64,000 payment at the end of this parliament but not again.
While the new expenses scheme is tougher than previous proposals, the most controversial element is Ipsa\'s decision to allow MPs to continue to employ family members.
Today Kelly criticised the move, which was opposed by 59% of people in polls conducted by Ipsa. He said: "We heard the same arguments [as Ipsa] and reached the conclusion that ending this practice was necessary to ensure the system was free from the suspicion of abuse. We still take the same view."
The Speaker of the Commons, John Bercow, said it was his "personal" view that MPs should not employ relatives, adding: "Ipsa is, however, independent and it must be allowed the chance to implement the system upon which it has settled in the next parliament."
Ipsa was created after details of MPs\' claims were leaked to the Daily Telegraph last year revealing the extent of abuse in the system, with MPs claiming thousands of pounds every year to subsidise their second homes and "flipping" their first and second homes to maximise the payment they could receive. Three Labour MPs – David Chaytor, Elliot Morley and Jim Devine – and the peer Lord Hanningfield have been charged with false accounting and preliminary hearings for the case are due in Southwark court tomorrow. The MPs are not expected to attend.
For more information, please visit
http://www.guardian.co.uk/politics/2010/[...]irst-class-travel-mps-expenses
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