R12-60

The independent regulator should continue to publish, at least quarterly, each individual claim for reimbursement made by MPs with accompanying receipts or documentary evidence. The information published should not be confined to claims actually reimbursed. 18 SUMMARY OF KEY REFORMS TO THE EXPENSES REGIME Summary of key reforms to the expenses regime Accommodation Past arrangements Interim measures Proposed future system MPs were able to claim up to Claims can include mortgage Support will only be provided for £24,222 towards accommodation interest, rent or hotel costs up to a rent or hotel costs. MPs will have costs. Claims could include maximum of £1,250 per month. accommodation directly provided mortgage interest, rent or hotel by the new regulator through an costs. agency. Bills will be paid directly by that agency. Under transitional arrangements, MPs with existing mortgages will be able to claim for mortgage interest until the end of the next Parliament. MPs could claim not only for basic MPs can only claim for costs MPs will only be able to claim costs such as utilities, council such as utilities, council tax, for basic costs such as utilities, tax, and building and contents service charges, and building and council tax, and contents insurance but also for services contents insurance. insurance. such as cleaning and gardening and for items such as white goods. MPs could claim for the cost MPs can no longer claim for the Interim arrangements to be made of maintaining their properties, costs of furnishing, repairs, or permanent. including any repairs or maintenance. redecoration. Claims could not in principle be made for anything improving the capital value of a property. MPs could claim £25 a night for MPs can claim £25 a night for Only MPs staying in hotels will food without needing to provide subsistence without needing to be able to claim for the costs of receipts when staying away from provide receipts when staying meals up to £25 a night. Receipts their home. away from their home. will be required. MPs with constituencies in outer From April 2010 MPs with No MP who represents a London can claim for the cost of a constituencies in outer London constituency falling within a second home if they so wish. will no longer be able to claim reasonable commuting distance of for the cost of a second home. Parliament will be eligible to claim (Permanent change) for the cost of a second home. MPs did not have to pay capital MPs should pay capital gains Any capital gain made during the gains tax on the sale of second tax on the sale of second homes transition period and attributable homes. funded by the accommodation to support from public funds allowance. should be surrendered to Parliament. 19 MPS’ EXPENSES AND ALLOWANCES: EXECUTIVE SUMMARY Accommodation Past arrangements Interim measures Proposed future system MPs who do not claim for the cost No change. London costs allowance of accommodation instead receive should be reduced to the level a £7,500 London costs allowance recommended by the SSRB (which would currently be £3,760). There should be a higher allowance for those with constituencies outside the Greater London area who do not receive taxpayer funded accommodation. Commuting MPs who work late can claim for cost of travel home or overnight hotel. In practice though not in principle No further changes to be made Designation of second homes MPs could allegedly change the to designation of second homes to be determined in line with designation of their main and in 2009-10, with a transparent rigorously enforced objective rules second homes to maximise appeal procedure for exceptional policed by the new regulator. personal benefit. cases. Ministers who have the use Ministers living in grace and favour Interim measure to be made of grace and favour homes in homes in London can no longer permanent. London can claim the costs for a claim for the costs of a second second home in London as well. home in London MPs who share accommodation MPs who share accommodation MPs who share accommodation can each claim the full allowance. as partners are limited to claiming as partners should be entitled a maximum of one person’s between them to claim up to a accommodation allowance limit of one individual ceiling, between them. plus one-third. 20 SUMMARY OF KEY REFORMS TO THE EXPENSES REGIME Staffing Current arrangements Proposed future system MPs may currently claim up to £103,812 to employ No change. staff to support their parliamentary duties. Staff are appointed and employed by MPs. Staff will continue to be recruited by MPs, but must be appointed through an open and transparent process. MPs may employ members of their own families MPs will no longer be allowed to use the staffing using public funds. allowance to fund the employment of family members. Transitional arrangements will allow existing family members to remain in their posts for one more Parliament. It is a breach of the House of Commons Code of It remains a breach of the House of Commons Code Conduct for MPs’ staff to be used in support of of Conduct for MPs’ staff to be used in support party political activities. of party political activities. But there should be a code of conduct for staff, and MPs should sign an annual declaration confirming that they have abided by the code and used parliamentary resources appropriately. Pay ranges are set centrally, though MPs have MPs should continue to set their staff’s pay in discretion as to where to place staff within the pay accordance with central pay scales. Guidance on scale. MPs have discretion to award bonuses up good employment practice should be issued by the to a certain limit. new regulator. Staff receive their redundancy pay from the winding- Staff redundancy pay should be provided centrally up allowance. by the new regulator and the size of the winding- up allowance reduced pro rata. Redundancy pay for MPs’ staff should be paid centrally by the new regulator. Administrative and office expenditure Current arrangements Proposed future system MPs can claim up to £22,293 to meet office running No change. costs and pay for additional services. MPs can rent offices and pay for services from party New audit arrangements should ensure that political organisations, provided that the political parliamentary funds are not used either intentionally party does not benefit. An independent valuation or inadvertently to give rise to material benefits for is required prior to renting from a party political political parties. An independent valuation should organisation. still be required prior to renting from a party political organisation. On leaving Parliament MPs retain ownership of office Equipment purchased using public funds should equipment purchased with public funds. remain the property of Parliament. Communications Current arrangements Proposed future system MPs may claim a £10,400 a year communications No communications allowance. Proactive allowance to communicate proactively with communication must be paid for out of the existing constituents. administrative and office expenditure budget. Current policing arrangements should continue to apply. 21 MPS’ EXPENSES AND ALLOWANCES: EXECUTIVE SUMMARY Travel Current arrangements Proposed future system MPs may currently claim for all costs of MPs will no longer be able to claim for reasonable commuting costs travel for parliamentary duties between and must pay for these in the same way as their constituents. home, constituency, and office. No MPs can claim for the cost of journeys to a home outside the constituency or London. MPs may travel first class. MPs should always consider value for money in purchasing tickets. They may still be able to claim for first class rail travel where they can justify it, but can only claim for economy class travel on flights within the UK or Europe. MPs may claim for the cost of family MPs may continue to claim for the cost of family travel up to the travel up to a set limit. limits currently in place. However, they may no longer claim for first class travel for family members, and may only claim for family travel during recess in exceptional circumstances. MPs do not have to submit supporting MPs should submit receipts and details of all journeys, to be evidence for journeys below a certain published online. Where appropriate, class of travel should also de minimis level, depending upon be published. constituency size. MPs may claim up to three return No change. visits a year to national parliaments of Council of Europe member states, and EU institutions and agencies. For each visit the Member may claim for two nights’ subsistence. MPs may claim for the cost of staff No change. travel up to a set limit. Leaving office Current arrangements Proposed future system MPs who lose their seats or stand down at a MPs who lose their seats at a general election should general election receive a resettlement grant of receive one month’s pay for every year served up to a between 50 and 100 per cent of annual salary. maximum of nine months salary. MPs who stand down at a general election should receive eight weeks’ pay from the date of the general election in lieu of notice to cover time spent winding-up offices, dealing with staff, and transferring casework. Loss of resettlement grant should be one of the sanctions considered as a penalty for MPs found guilty of breaching the Code of Conduct. MPs may claim for the costs of a winding-up No change to claims for the winding-up allowance. allowance to meet necessary expenditure incurred The amount claimable should be reduced to reflect after leaving office – e.g. to settle outstanding bills the fact that redundancy pay for staff should in future or pay staff who have been given notice. be paid out of a central budget. 22 ABOUT THE COMMITTEE ON STANDARDS IN PUBLIC LIFE About the Committee on Standards in Public Life 1. The Committee on Standards in Public Life is an advisory Non-Departmental Public Body (NDPB) sponsored by the Cabinet Office. The Chair and members are appointed by the Prime Minister. The Committee was established in October 1994, by the then Prime Minister, Rt Hon Sir John Major, with the following terms of reference: “To examine current concerns about standards of conduct of all holders of public office, including arrangements relating to financial and commercial activities, and make recommendations as to any changes in present arrangements which might be required to ensure the highest standards of propriety in public life.” 2. The remit of the Committee excludes investigation of individual allegations of misconduct. 3. On 12 November 1997 the terms of reference were extended by the then Prime Minister: “To review issues in relation to the funding of political parties, and to make recommendations as to any changes in present arrangements.” Membership of the Committee for this Inquiry 1 Sir Christopher Kelly KCB (Chair) David Prince CBE Lloyd Clarke QPM Dr Elizabeth Vallance JP Sir Derek Morris MA Dphil Dr Brian Woods-Scawen DL CBE Dame Denise Platt DBE Acknowledgements 4. David Doig, a former Principal Clerk in the House of Commons, acted as an adviser to the Committee. 5. The Committee is grateful to the following MPs for allowing members of the Committee to shadow or observe them in their work: Member of Parliament Constituency Paul Burstow MP Sutton and Cheam (Liberal Democrat) Rt Hon Andrew Smith MP Oxford East (Labour) Jeremy Wright MP Rugby and Kenilworth (Conservative) Barry Sheerman MP Huddersfield (Labour/CO-OP) Jacqui Lait MP Beckenham (Conservative) John Mann MP Bassetlaw (Labour) Sir Peter Soulsby MP Leicester South (Labour) 6. Advice and assistance to the Committee for this inquiry was also provided by Treasury Solicitor’s Department. Secretariat 7. The Committee is assisted by a Secretariat: Ruth Alaile (Secretary); Peter Hawthorne (Assistant Secretary); Martin Adams (Senior Policy Advisor); Rachel Finlay (Policy Assistant); Anju Still, (Business Manager); Matthew Dowding (Secretariat Co-ordinator); and Maggie O’Boyle (Press Officer). Gloria Durham also provided assistance to the Committee for part of the inquiry. The Secretariat provides policy advice, drafting and all aspects of the organisational and logistical support required by the Committee to operate effectively. 1 The three political representatives on the Committee: Oliver Heald MP; Baroness Maddock; and the Rt Hon Alun Michael MP, decided not to take part in this inquiry because of concerns about a real or perceived conflict of interest. For further information see the Committee’s statement on involvement of political representatives, published on 3 April 2009. 23 The Committee on Standards in Public Life 35 Great Smith Street London SW1P 3BQ Tel: 020 7276 2595 Fax: 020 7276 2585 Internet: www.public-standards.gov.uk Email: public@standards.x.gsi.gov.uk November 2009