MPs secretly lobby for pay rise after expenses curb

Published on Wednesday 4 November 2009 21:14

MEMBERS of Parliament are privately pushing for a significant pay rise to compensate them for the biggest crackdown on their expenses in parliamentary history.

The long-awaited report from Sir Christopher Kelly's Committee on Standards in Public Life yesterday called for an end to MPs claiming mortgage interest payments on expenses and employing family members from the public purse.

Aware of the public anger over the issue, all of the main party leaders said they accepted the recommendations in full.

But behind the scenes, a number of MPs are now lobbying for a pay review after the Kelly report made clear that the next generation of parliamentarians must atone for the sins of current members. While few MPs wanted to break cover and openly call for the raise, a significant number now want to see basic pay rise from its current level of 64,766.

But Sir Stuart Bell, the senior Labour MP who is regarded as the unofficial "shop steward" of MPs and sits on the Members Estimates Committee, which helps determine allowances, also suggested a pay review.

He highlighted Sir Christopher's recommendation that the new Independent Parliamentary Standards Authority (IPSA) and the Senior Salaries Review Body (SSRB) look at the pay structures for MPs "so that in the longer term we can marry pay structures with allowances in such a way that the dreadful allowance system is abolished for all time".

A senior Scots MP told The Scotsman that there "was nothing modernising about working for slave wages" and that MPs would almost certainly have to be paid more.

Efforts to increase pay have been made easier by the Kelly review, which has said that the SSRB would set pay, without any need for an MPs' vote. At present, the review body recommends pay increases but MPs have to publicly vote for the increase. In the past, the body has often recommended generous rises for MPs which have previously been vetoed by Prime Minister Gordon Brown.

Any move to increase pay is likely to outrage constituents at a time when many are enduring their own pay freeze. But no pay review is expected until after the general election.

Sir Christopher himself said if there was a chance people could be deterred from being MPs, this should be addressed through "the arrangements of MPs' pay, not through retaining an overly generous and overly lax expenses system".

Solicitor General Vera Baird also hinted at a pay rise. "We will have to look at where Sir Christopher's proposals will leave people. If there is a danger that people who are just ordinary but who have a commitment to public service and want to come to Parliament are going to be priced out of this, then of course pay will have to be looked at," the minister told the BBC.

"I don't want a care worker who has decided they want to come to Parliament to feel they can't run two houses on the new terms, so we have to look at this." The IPSA would have to look at "whether there needs to be compensation" to stop MPs from being "frightened" away, she added.

Mr Brown has also urged Sir Christopher to ensure people from modest backgrounds would not be deterred by a regime that was too punitive.

But Tory frontbencher Grant Schapps said it was "preposterous" to consider raising MPs' pay just as they were trying to distance themselves from the expenses scandal.

Chris Huhne, the Liberal Democrat home affairs spokesman, said MPs were already paid double the national average so should not be fishing for rises.

Sir Christopher's review would impose a cap of 1,250 a month for rent or hotel stays. MPs in future will not be allowed to claim for mortgage interest, and any capital gains made on their properties from now because of public funds will go back to the taxpayer.

Other changes will include a ban on hiring relatives and scrapping the resettlement grant of up to 65,000 for MPs who stand down voluntarily.

MPs will also be stopped from "double-jobbing" – which would mean someone such as First Minister Alex Salmond could not hold a Westminster seat and one in a devolved administration.

The expenses review was triggered by leaked details of MPs' allowances. After years of attempting to exempt themselves from Freedom of Information laws, MPs were finally exposed when details of all individual claims were leaked to the Daily Telegraph by a disgruntled former Commons official.

Sir Christopher said that his blueprint was "fair and reasonable" and would bring the House of Commons into line with other walks of life and other legislatures.

Both Mr Brown and Conservative leader David Cameron have urged their MPs to back the changes and adopt them without question.

MPs jeered when Speaker John Bercow told them the new IPSA head, former TV host Sir Ian Kennedy, would earn up to 100,000 a year for chairing the body.

Mr Bercow warned MPs not to prevaricate in adopting the recommendations.

The changes will take up to five years to enforce for existing MPs, although those elected at the general election next year will immediately have to comply. MPs will have no vote on the IPSA's plans, though they will be asked in a few days to approve Sir Ian's nomination.

What they can – and cannot – claim

ACCOMMODATION

MPs will be banned from claiming for mortgage interest. Instead, they will have to rent, at a maximum of 1,250 a month. New MPs will have their accommodation vetted by a commercial agency appointed by parliament's independent regulator. This will stop MPs renting homes to each other.

They will also have to pay back any capital gains made as a result of public funds from yesterday until the day they sell the property. MPs representing constituencies within a 20-mile radius of London will lose their second-home allowance. Taxpayers will stop funding any mortgages within five years. The practice of "flipping" homes will also be stopped.

STAFFING

Spouses and relatives will no longer be able to work for MPs. All family arrangements will be phased out within five years. Work by MPs' staff will be audited to ensure they are not engaging in party political work.

RESETTLEMENT GRANTS

Any MP voluntarily standing down will lose the resettlement grant of up to 65,000 by the time of the election after next. They will receive eight weeks' pay instead. MPs who lose their seats at an election will receive one month's pay for every year of service, up to a maximum of nine months' pay. MPs who fiddle their expenses or breach the code of conduct will have a penalty deducted from their resettlement grant.

DUAL MANDATE

The practice of MPs sitting in other parliaments or devolved administrations while holding a Westminster seat will be stopped by 2011. MPs from Northern Ireland, 16 of whom have a dual mandate, will have until 2015 to give up one of their jobs. First Minister Alex Salmond is the only Scottish MP to also hold a Holyrood seat but he is standing down as an MP at the next general election.

TRAVEL

Expenses will only be allowed for journeys where the primary purpose is parliamentary duties, rather than for party political visits. MPs will also be made to fund their own commuting within London. They will be able to claim for first-class train travel only for long journeys, and can be reimbursed only for economy air travel.

OTHER EXPENSES:

Council tax, utility bills, telephone line rental and calls, security, contents insurance and removals at the start and end of a tenancy will be reimbursed. But MPs will no longer be able to claim for cleaning, gardening and furniture, or for accountancy fees to fill out tax returns. They will also lose their 10,000 communications allowance.

New watchdog

MPS will have their pay and pensions set by a new Independent Parliamentary Standards Authority (Ipsa).

The body takes over the duties of the Commons Fees Office, which lost the public's confidence after the expenses scandal. Ipsa will also have the power to recommend sanctions for MPs who break the rules.

Sir Ian Kennedy was selected by a committee chaired by Commons Speaker John Bercow to lead Ipsa. An expert on the law and ethics of health, Sir Ian is Emeritus Professor at University College London and chaired the Healthcare Commission from 2003-9. He also chaired an inquiry into children's heart surgery at Bristol Royal Infirmary and in the 1980s hosted several editions of Channel 4's discussion programme After Dark.

He will receive a salary of up to 100,000 a year in the new post – over 30,000 more than a back-bench MP's basic pay.

Sir Ian said he would start work immediately and a consultation paper will be put forward in early December. After a brief period for consultation, the new scheme will be in place early next spring.