Expenses row: Worst offenders are exposed

Published on Wednesday 13 May 2009 22:04

A FORMER Labour minister was last night accused of the most serious abuse of MPs' expenses to date when it emerged that he claimed almost £16,000 for a non-existent mortgage.

In what the newspaper which leaked the details claimed was "the most serious" expenses disclosure so far, it was reported that Elliot Morley, now a senior backbencher in charge of a Commons select committee, claimed 800 a month in mortgage interest repayments for 18 months after paying off the original loan.

He subsequently "flipped" his second home allowance from his Scunthorpe constituency to his London flat, allowing expenses to be claimed on his property in the capital.

But for at least one month, he was letting this flat out to a fellow Labour MP, Ian Cawsey, who claimed 1,000 a month in rent from public funds – and unknowingly passed the cash to Mr Morley.

Last night, Mr Morley apologised and repaid the mortgage claims. However, legal experts said he could face criminal charges. Fraud carries a maximum sentence of ten years' jail and/or an unlimited fine.

Other revelations centred on a Labour backbencher, Fabian Hamilton, who declared his mother's London house as his main residence – allowing him to claim thousands for his constituency home in Leeds.

Mr Hamilton last night insisted reports he claimed for a new boiler for his Leeds home were "untrue".

Meanwhile, John Maples, a Thatcherite Tory and party deputy chairman, declared a room in a Pall Mall club in London was his main residence – allowing second home claims on his property in Oxfordshire.

Mr Maples said the Commons authorities were aware of his arrangement, and he spent "four or five" nights a week in London.

Asked if he would repay the money, he said: "I don't see why I should I'm confident I behaved honestly."

However, he said that if David Cameron ordered him to repay the cash – the scale of his claim was not revealed last night – as part of a sleaze-busting purge ordered this week by the Tory leader, then he would do so.

In another blow for the Tories, Stephen Crabb, a Welsh Tory MP and rising star of the party – in an echo of the controversy that has engulfed Home Secretary Jacqui Smith – said his main home was a room in a London flat rented by another MP.

This allowed him to reclaim 9,300 in stamp duty from the purchase of a family home in his constituency.

He had previously "flipped" the designation of his main home from a London flat he had sold after 8,000 of taxpayer-funded improvements.

Last night, Mr Crabb insisted "every decision I have made about accommodation as Member of Parliament has been made with the explicit guidance of the Fees Office".

A Downing Street political spokesman said Labour's Chief Whip Nick Brown would today meet Mr Morley and other MPs caught up in the latest expenses row, which comes as Prime Minister Gordon Brown prepares to launch Labour's campaign for the June 4 European and council elections."

The latest revelations came as other MPs implicated in the expenses scandal rushed to repay more than 100,000 over the past 48 hours in a desperate bid to ease public outrage and save their political careers.

As the leaders of the three main Westminster parties and the SNP united to support an independent audit of more than one million claims stretching back four years, Labour health minister Phil Hope said he would repay more than 40,000 by next week.

Mr Hope, the Labour MP for Corby, claimed 41,709 over five years to furnish his second home in London.

Mr Hope, who has a majority of just 1,517, said he could not allow the "dreadful perception" among constituents to continue. He added: "This issue has fundamentally changed the view people have of me and that is something I cannot bear."

The expenses row dominated Prime Minister's Questions, during which Nick Clegg, the Lib Dem leader, called for Westminster to adopt the Scottish Parliament's system of banning taxpayer-funded mortgages in a bid to prevent politicians making a "fast buck" on the property market.

Mr Clegg said MPs should repay any profits made on the sale of homes bought with the help of public funds.

During the exchange, Mr Cameron accused the Prime Minister of failing to show political leadership and having a "tin ear" to the level of public anger at the scandal.

However, there was a challenge to Mr Cameron's new "Scrutiny Panel" from former minister Douglas Hogg last night.

Mr Cameron said the internal party panel would have the power to demand the repayment of "excessive" claims and any MP who refused to comply will be stripped of the Conservative whip. But Mr Hogg said the panel should not pass judegment on MPs, but simply pass on any concerns to the existing cross-party Commons committees which scrutinise the allowances system.

The MP claimed more than 20,000 a year towards the maintenance of his country manor house, but insists he acted "within both the spirit and the letter" of parliamentary rules and denies reports he put the clearing of a moat on expenses.

Asked whether he would pay back money if ordered to by the panel, Mr Hogg replied: "The Cameron committee – if it exists – has been overtaken by events.

"I think the proper way forward is to use the existing parliamentary committees."

Earlier yesterday, Sir Menzies Campbell, the former Lib Dem leader and North-East Fife MP, said he would repay a 1,490 bill for an interior designer who helped refurbish the luxury flat he rents in Chelsea. He had claimed nearly 10,000 for items including a king-sized bed and flat-screen television.

Other sums repaid yesterday included 22,500 claimed by Margaret Moran, the Labour MP for Luton South, to treat dry rot at a property in Southampton; 1,005 claimed for a leather rocking chair by Lib Dem communities spokeswoman Julia Goldsworthy; and 2,675 claimed in legal fees by Mr Lazarowicz.

Mr Brown yesterday indicated support for a Tory proposal of putting all expenses online as they are claimed. An immediate ban has been introduced on claiming for furniture, household goods and "white goods", and MPs are no longer be able to "flip" the designation of their London and constituency homes.

Mr Cameron warned that the retrospective review into the last four years of claims, involving more than one million receipts, would fail to get to the "heart of the problem" or the "heart of the anger that people feel".

He called for the 10,000 a year communications allowance, which funds MPs' constituency newsletters, to be scrapped and the number of MPs at Westminster to be cut to save money.

He added: "How much needs to be paid back is not really a legal issue – it is a moral and an ethical issue, and it requires some political leadership to sort it out."

The Prime Minister insisted that a wider review of MPs' allowances, being carried out by anti-sleaze watchdog Sir Christopher Kelly's Committee on Standards in Public Life, was necessary to restore public trust.

Matthew Elliott, chief executive of the Taxpayers' Alliance, said last night's revelations about Mr Morley were the "most disgusting yet" and called for the police to be brought in.

&#149 Frontline police officers accused MPs of enjoying expenses would not look out of place in a "third world dictatorship" yesterday.

Home Secretary Jacqui Smith was hauled over the coals by members of the Police Federation of England and Wales.

Steve Morley, of the Metropolitan Police, challenged Ms Dmith during a question-and-answer session at Bournemouth's International Centre were met with a long round of applause by hundreds of delegates.

Ms Smith said: "Where people make mistakes, I made a big mistake, they repay the money and apologise for that, and I have done."

AT A GLANCE – WHO'S REPAID WHAT

SINCE the newspaper revelations about their expenses began a week ago, a number of MPs have pledged or have already begun to repay claims regarded as questionable.

The MPs who have made public their intentions include Phil Hope (41,709), Margaret Moran (22,500), Hazel Blears (13,332), Gordon Brown (150), Lembit Opik (40), Mark Lazarowicz (2,675), Lady Sylvia Hermon (2,730), Sir Menzies Campbell (1,490), Julia Goldsworthy (1,005), Nick Clegg (80) and Chris Huhne (119).

In addition, a number of Conservatives have agreed to repay sums under pressure from their leader, David Cameron, who has himself repaid a claim of 680.

The other Tories include Alan Duncan (4,700), Michael Gove (7,000), Oliver Letwin (2,000), Andrew Lansley (2,600), George Osborne (440), David Willets (115) and Cheryl Gillan (4.47).