Denis MacShane admits bogus MPs expenses claims

MacShane admitted making the bogus claims in court today. Picture: PA
MacShane admitted making the bogus claims in court today. Picture: PA
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FORMER Labour minister Denis MacShane is facing Christmas behind bars after he admitted fiddling parliamentary expenses and defrauding taxpayers of almost £13,000.

The Scottish politician submitted 19 fake receipts, amounting to £12,900, for “research and translation” services to Westminster authorities. But the money was actually used to fund trips to Europe, including one to judge a literary competition in Paris.

The Glasgow-born former MP, who resigned from Westminster last year, claimed the money through the European Policy Institute (EPI) – a company he controlled. Receipts sent from the company included signatures from its general manager, who did not exist.

MacShane entered multiple claims for services to help with work he was undertaking as an MP between 2005 and 2008. Invoices were for up to £950 each.

But a report by the parliamentary commissioner for standards, John Lyon, found MacShane himself controlled the EPI’s bank account and the funds had been spent on hospitality and travel.

He was effectively “submitting invoices to himself and asking the parliamentary authorities to pay”, the report said.

On Monday, MacShane appeared at the Old Bailey in London. Asked to enter a plea to one charge of false accounting, MacShane replied simply: “Guilty.”

Mr Justice Sweeney warned MacShane that “all sentencing options remain open”. He was granted unconditional bail and sentencing was adjourned until 19 December.

The maximum jail term for false accounting is seven years, but the former minister for Europe between 2002 and 2005 is expected to receive a shorter sentence.

MacShane has previously said he believed the MPs’ expenses scandal “will be seen as a wonderful moment of British fiddling, but more on a Dad’s Army scale than the real corruption of politics”.

He refused to comment as he left the Old Bailey yesterday, but is understood to accept that he made a “grotesque mistake”. He insists he did not make any personal gain from the claims.

The House of Commons authorities began looking at his claims when the expenses scandal engulfed Westminster in 2009. They referred the matter to police within months after identifying potential criminal activity.

But the archaic principle of parliamentary privilege meant detectives were not given access to damning correspondence with the standards commissioner, in which MacShane described how signatures on receipts from the EPI had been faked.

One letter, dated October 2009, described how he drew funds from the EPI so he could serve on a book-judging panel in Paris. But the letters emerged in November only last year, after Scotland Yard said it was taking no further action and the standards committee published a report recommending a 12-month suspension from the House.

The committee described it as the “gravest case which has come to us for adjudication, rather than being dealt with under the criminal law”.

MacShane resigned as MP for Rotherham before the punishment could be imposed.

Police reopened their probe in light of the fresh evidence and the 65-year-old was charged in May – even though the letters are still not thought to be admissible in court. The offence covered 19 receipts that MacShane filed between January 2005 and January 2008.

A Crown Prosecution Service spokeswoman said: “The decision to charge was reached following a reconsideration of the case after the publication of the select committee report.”

MacShane’s plea effectively brings to an end the fallout from the 2009 expenses scandal.

Four MPs and two peers have been sent to prison as a result of the expenses revelations from 2009, including former Livingston MP Jim Devine. Former Labour minister Elliot Morley, David Chaytor and Eric Illsley have also been jailed.

Conservatives to fall foul of the law were Lord Hanningfield and Lord Taylor of Warwick.

Another ex-Labour MP, Margaret Moran, was spared prison and given a supervision order after suffering mental health problems. It is believed that no other MPs are being pursued.

MacShane was a notable defendant of the previous MPs’ expenses system.

He wrote in a newspaper four years ago: “As the moralising of the self-important reaches a hysterical crescendo, there will come a moment when moats and manure, bath plugs and tampons will be seen as a wonderful moment of British fiddling, but more on a Dad’s Army scale than the real corruption of politics” – which he claimed was the role of private business interests rather than the behaviour of individual MPs.

MacShane had a successful front bench career, regularly representing Tony Blair on the world stage until 2005, when he was sacked after Labour’s third consecutive election victory.

Initially he said he had no idea why he lost his job, though remarks in which he described then chancellor Gordon Brown’s tests for joining the euro as a “giant red herring” were thought to have played a part.

He at first denied the comments, made to students at Durham University, but they had been recorded and were played live on television.