Disinfecting Parliament
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DISINFECTING PARLIAMENT
Sir Christopher Kelly's Committee on Standards in Public Life review of MPs' expenses ‐ The Shadow Report Juliet Samuel
The Sunlight Centre is a non-partisan, not-for-profit company advocating political transparency and openness.
Published by GGN Ltd Copyright © Juliet Samuel, Sunlight Centre for Open Politics October 2009
CONTENTS FOREWORD BY DOUGLAS CARSWELL MP ........................................................... 4 INTRODUCTION ....................................................................................... 5 1 MPS’ PAY ............................................................................................. 7 1.1 1.2 1.4 1.5 1.6 1.7
BASIC PAY ........................................................................................................................................... 8 SUPPLEMENTARY SALARIES ................................................................................................................ 8 RELATIVE WAGE RISES ...................................................................................................................... 10 PENSIONS ......................................................................................................................................... 11 PERKS ............................................................................................................................................... 12 OVERALL ........................................................................................................................................... 12
2 HOW EXPENSES WORK ................................................... 13 2.1 THE NEW MP ................................................................................................................................... 13 2.2 HOUSE OF COMMONS ADMINISTRATION ........................................................................................ 14 2.2.I NECESSARY FUNCTIONS ................................................................................................................................ 14 2.2.II THE PROLIFERATION OF COMMITTEES ............................................................................................................. 14 2.2.III A FLOW‐CHART: VISUALISING PARLIAMENTARY ADMINISTRATION .................................................................... 14 2.2.IV ADMINISTRATIVE FUNCTIONS: A MORE DETAILED LOOK ...................................................................................... 16 2.3 THE ALLOWANCES: A BRIEF LOOK .................................................................................................... 22
3 WHAT WORKS, WHAT DOESN’T ......................................... 24 3.1
THE ALLOWANCES: “WHOLLY, NECESSARILY AND EXCLUSIVELY” ................................................................. 24
3.1.I WHAT WORKS .......................................................................................................................................................... 24 3.1.II WHAT DOESN’T ........................................................................................................................................................ 24
3.2 OUTSIDE INTERESTS: LOBBYISTS IN THE WOODWORK ............................................................................... 27 3.2.I WHAT WORKS .......................................................................................................................................................... 27 3.2.II WHAT DOESN’T ........................................................................................................................................................ 27
3.3 ADMINSTRATION: THE BUCK STOPS... WHERE? ....................................................................................... 28 3.3.I WHAT WORKS .......................................................................................................................................................... 28 3.3.II WHAT DOESN’T ........................................................................................................................................................ 28
4 RECOMMENDATIONS .................................................... 31 4.1 4.2 4.3 4.4 4.5
SIMPLIFY AND SCALE BACK EXPENSES ............................................................................................... 32 HOLD PARLIAMENT TO ACCOUNT BY ABOLISHING ADMINISTRATIVE CONFUSION ............................. 34 ESTABLISH AN EXPENSES BANK ACCOUNT AND USER‐FRIENDLY DATABASE ....................................... 39 FULL PUBLICATION AND PUBLICITY ................................................................................................... 41 MEANGINFUL PENALTIES FOR BREAKING THE RULES ......................................................................... 42
CONCLUDING REMARKS .................................................... 44 APPENDIX ............................................................................................................................................. 45
LIST OF FIGURES Figure 1: Income distribution ‐ Number of people (millions) versus income (£ per week) ................................. 8 Figure 2: Many MPs already receive extra salaries ............................................................................................. 8 Figure 3: MPs are paid adequately compared to politicians in other developed countries ................................ 9 Figure 4: Members of Parliament salaries ........................................................................................................ 10 Figure 5: Members of Parliament salaries per thousands of people represented ............................................ 10 Figure 7: Exchequer contributions to pension funds ......................................................................................... 11 Figure 8: MP contribution and accrual rates ..................................................................................................... 11 Figure 9: Visualisation of House of Commons and Expenses Administration ................................................... 15 Figure 10: Detailed information on Administrative Bodies ............................................................................... 17 Figure 11: List of expenses ................................................................................................................................. 22 Figure 12: Expenses administration ‐ the case for simplification ..................................................................... 29 Figure 13: Artist's impression of the Olympic Village ........................................................................................ 32 Figure 14: Proposal for a reformed administrative structure for MPs’ expenses ............................................. 34 Figure 15: Number of official roles in expenses system is dramatically reduced .............................................. 35 Figure 16: An MPs' expense debit card .............................................................................................................. 39 Figure 17: Mock‐up of a transparent expenses database .................................... Error! Bookmark not defined. Figure 18: Schedule of sanctions to dis‐incentivise corruption ......................................................................... 43
FOREWORD by Douglas Carswell MP
Cleaning up Westminster is too important a task to leave to MPs, quangocrats or professional commentators. That is why this report is so important. The House of Commons got into a mess over MPs expenses because the political class failed to be straight with people. Without transparency, those in SW1 created a system of generous tax‐free allowances and off‐balance sheet accounting. Without openness, Westminster developed the ethics of Enron. Elected lawmakers must have some recourse to public funds to do their jobs. MPs do need to be paid. If not, only rich plutocrats could stand for office. But whenever public money is spent, the public has an absolute right to see how their money gets spent. Defending the indefensible on the basis that it was all “within the rules” will not do. It has merely shown quite how far our Parliament – the nation’s rule makers – have lost their way. Change does not just mean cleaning up expenses. It means restoring purpose to Parliament. Changing behaviour can require external discipline. But it is not enough to impose a requirement on every MP to publish details of what they claim. Changing the behaviour of our politicians also means making sure that every MP faces a properly competitive election contest every few years. And that means the option of open primaries and recall elections in every constituency. We need a new deal in politics; an end to MPs perks, fewer politicians, real legislative work rather than self‐aggrandising, citizen lawmakers rather than professional politicians. That will only happen when we get proper, genuine accountability.
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INTRODUCTION “How we see our role is basically to clean up the expenses system; to do so in a way which helps begin what I'm sure will be a long and difficult process of restoring trust in public office holders.” Sir Christopher Kelly, Chair of the Committee on Standards in Public Life, on the Andrew Marr Show, 14th June 20091 Time and time again, at the recent hearings of the Committee on Standards in Public Life, the same mantra was repeated: “The prime purpose of your Committee and generally, I suspect,” said John Drysdale of Transparency International, “is to restore the trust and confidence in Parliament and in MPs.” Unlike the official Committee’s report, this report does not seek to rebuild public trust in Parliament or British democracy. That outlook has
1
BBC: http://news.bbc.co.uk/1/hi/programmes/andrew_marr_show/ 8099326.stm
the issue backwards. Instead, we ask Parliament to trust the citizens of this country – to trust them with information, with access, and with powers to hold politicians to account. If politicians want respect while continuing to spend public money, they have to show that they realise it is just that – public money. With public money should come a public expenses bank statement, a public expenses database and, ultimately, the sovereignty of public judgment on how expenses are used. Instead, we see the government setting up a new “independent” bureaucracy to play the king over expenses, with absolutely no statutory publication requirements. We see redactions, obfuscation and mere lip service paid to the idea of accountability. That is why, in this alternative, “shadow” report to Parliament’s expenses inquiry, we recommend full publication of all expenses, scaling back the scope for abuse and bringing all the obscure decision‐making bodies, ad hoc audits and investigatory procedures into full view.
Specifically, we recommend that Parliament:
1. SIMPLIFY AND SCALE BACK EXPENSES: Provide MPs with housing in the Olympic Village and stop paying generous extra salaries to party Whips and obscure officials. 2. HOLD PARLIAMENT ACCOUNTABLE BY ABOLISHING REDUNDANT BODIES: Get rid of the buck‐passing committees and bureaucracies by cutting at least 32 officials out of the expenses system. 3. ESTABLISH A SINGLE MPs' BANK ACCOUNT, A PUBLIC DATABASE AND FULL AUDIT: Let the public check MPs’ expenses statements just as we check our own bank statements and set up a properly audited public database. 4. PUBLISH EVERYTHING AND OPEN UP ACCESS: Remove the gag on the Commissioner, bring parliamentary investigations out of the shadows with televised press conferences and put lobbyists on a compulsory register. 5. IMPOSE PUNISHMENTS FOR MPs WHO ABUSE THEIR POWER: Give citizens the right to trigger by‐elections and make it possible to get rid of dishonest Members. Overall, we calculate that these changes are worth about £75 million in savings in the parliamentary budget (for a breakdown of this figure, see page 31). 5
The following report goes through the expenses system in four parts: ‐ In Section One, it is shown that MPs cannot fall back on the excuse that they are underpaid – by every comparator, MPs are quite adequately paid. ‐ Section Two explain exactly how decisions get made in the expenses system, who is responsible for what (Section 2.2), and provide a brief outline of when different expenses were introduced and what evidence is required to claim them (Section 2.3). ‐ In Section Three, the report details, point by point, where the current system fails. The various allowances are dealt with in Section 3.1, outside interests in Section 3.2, and parliamentary administration in Section 3.3. ‐ Finally, Section Four outlines which expenses need to be abolished, how information about expenses should be published, and what a fully transparent and accountable system would look like. AUTHOR BIOGRAPHY: Juliet Samuel Juliet spent the last four years studying for her BA in Social Studies at Harvard University. She specialised in the work of theorists such as Hannah Arendt and Walter Benjamin and continues to be a contributing writer to the DC‐based magazine, Reason. She returned to join the Sunlight Centre for Open Politics in June and has spent three months getting to grips with the expenses crisis and what it means for British democracy.
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1 MPs’ PAY
The most common narrative of the current expenses crisis takes its roots back twenty or thirty years. In one version, the issue goes back to Thatcher who, it is said, set up a generous expenses system in order to avoid giving MPs a politically tricky salary raise. These and similar narratives are based on the premise that MPs have been consistently underpaid for their work for the last few decades. The perceived solution is supposedly, therefore, to increase MPs’ salaries and thereby avoid covert and corrupt pay‐rises through the
expenses system. Advocates of this policy also suggest that it be accompanied by an abolition or significant reduction in the amounts claimable on expenses. The assumption that MPs are underpaid, however, needs to be examined. By any relative measure, MPs seem to be well‐paid. Whether one examines basic pay, ministerial salaries, compares their remuneration with those of other developed countries’ politicians or compares their pension schemes, the answer is the same: There is little case for a pay rise.
LOGICAL FALLACY: The “woefully underpaid” political classes
David Blunkett MP, in his submission to the Committee on Standards in Public Life (CSPL): “...the most logical change would be to bite the bullet and pay MPs the kind of salary they would expected to receive in equivalent jobs – head of a further education college, a doctor after several years in practice, or a senior civil servant...”2 The Times leading editorial, 22nd April 2009: “The truth is that our politicians are woefully underpaid. This is not a popular thing to say. But if we want a professional political class, we must pay professional rates.”3 Brian Donohoe MP, in his submission to the Committee on Standards in Public Life (CSPL): “Historically, MPs' remuneration has eroded in real terms. Many members feel aggrieved about this, and to a large extent this forms the backdrop to the recent controversy.”4 As reported in the Baker Review of Parliamentary Pay and Pensions, three non‐front‐bench members of the Members Estimate Committee recommended a substantial pay rise for themselves: “[Their memorandum] argues that the MPs’ salary should be increased by £650 a year (the figure proposed by the SSRB) above indexation for three years, with a final increase to £75,000 to take effect immediately after the next general election.”5 Kevin Barron MP, in his submission to the CSPL: “You could argue that the reluctance by parliament to increase salaries is one of the reasons why you [the Committee on Standards in Public Life] are involved. [...] I agree it would be possible but perhaps impractical to increase the level of basic pay to form part of simplifying current arrangement.”6 Verdon Bogdanor, in an article in The Times, 14th May 2009: “Margaret Thatcher, he recalls, ordered an independent review that recommended rises that would make even Jacqui Smith blush. But that would have enraged voters. So Mrs Thatcher rejected it. MPs were furious. To appease them, they were encouraged to supplement their salaries through the expenses system. Recompense would replace remuneration.”7
2
CSPL evidence, 2009: http://www.public‐standards.gov.uk/Library/MP_Exp_E1_Rt_Hon_David_Blunkett_MP.pdf. The Times, April 2009: http://www.timesonline.co.uk/tol/comment/leading_article/article6143456.ece. 4 CSPL evidence, 2009: http://www.public‐standards.gov.uk/Library/MP_Expenses_E494_Brian_Donohoe_MP.pdf. 5 Baker Review: http://baker‐ review.ome.uk.com/binary/documents/Review%20of%20Parliamentary%20Pay%20and%20Pensions%20by%20Sir%20John%20Baker%20C BE.pdf p6. 6 CSPL evidence, 2009: http://www.public‐standards.gov.uk/Library/MP_Expenses_E201_Kevin_Barron_MP.pdf. 7 The Times, May 2009: http://www.timesonline.co.uk/tol/comment/columnists/guest_contributors/article6282598.ece. 3
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ARE MPs UNDERPAID?
1.1 BASIC PAY The basic salary of an MP is currently £64,766. This already puts the vast majority of MPs in the top decile group for income – i.e., richer than 90% of the population. An MP with a dependent spouse and two young children paying average council tax, for example, is nonetheless still making more than 92% of the population at large.8 And in gross income alone, MPs make over 250% more than the average annual salary of £24,908.9 Moreover, the job of being an MP carries with it numerous privileges aside from salary, including social status and a sense of meaning and satisfaction derived from serving the public. Given that there is no shortage of potential parliamentary candidates, it seems clear that the combination of a good salary level and non‐ monetary attractions are both sufficiently attractive as to making standing for office competitive.
1.2 SUPPLEMENTARY SALARIES On top of this basic salary, many MPs are paid supplementary salaries. Latest figures suggest that there are now 32 ministers of state, who each earn a supplementary salary of £41,370, for a total salary of £106,136. There are also currently 23 Cabinet ministers, who each earn a supplementary salary of £79,754, for a total salary of £144,520.10,11 Including Whips and other Commons officials, there are already 83 MPs (that is, 12.8% of all MPs) earning over £100,000 per annum, putting them in the top 2% of earners.12
8
Calculated by the Institute of Fiscal Studies for a family of four paying a council tax of £1421: http://www.ifs.org.uk/wheredoyoufitin/. 9 National Statistics: http://www.statistics.gov.uk/cci/nugget.asp?id=285. 10 House of Commons Factsheet M06, May 2009: http://www.parliament.uk/documents/upload/M06.pdf 11 Number of Cabinet and junior ministers, Downing Street website: http://www.number10.gov.uk/Page19564. 12 Calculated by the Institute of Fiscal Studies for a family of four paying a council tax of £1421: http://www.ifs.org.uk/wheredoyoufitin/.
Figure 1: Income distribution ‐ Number of people (millions) versus income (£ per week)13
Figure 2: Many MPs already receive extra salaries14 Pay (£)
Prime Minister
Total (£)
132,923
197,689
79,754
144,520
41,370
106,136
Parliamentary Under Secretary of State Solicitor General and Advocate General Government Chief Whip
31,401
96,167
69,491
134,257
79,754
144,520
Government Deputy Chief Whip Government Whip and Assistant Whips Speaker
41,370
106,136
26,624
91,390
79,754
144,520
Chairman of Ways and Means (Deputy Speaker) First and Second Deputy Chairman of Ways & Means Select and Standing Committee Chairs Leader of the Opposition Opposition Chief Whip
41,370
106,136
36,360
101,126
Up to 14,366 73,617
Up to 79,132 138,383
41,370
106,136
Deputy Opposition Chief Whip
26,624
91,390
Cabinet Minister and Lord Chancellor Minister of State
13
Institute of Fiscal Studies: http://www.ifs.org.uk/wheredoyoufitin/. 14 Notes: “Pay” is supplementary pay for ministerial post; “Total” includes parliamentary salary of £64,766. Only Chairs of committees appointed under Standing Order 152 receive extra pay. Standing Committee Chairman pay depends on length of service.
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1.3 COMPARISONS WITH OTHER DEVELOPED COUNTRIES Comparisons with other developed countries also show that British parliamentarians are relatively well‐paid:
Figure 3: MPs are paid adequately compared to politicians in other developed countries15
Country and currency
Salary in £, converted using Purchasing Power Parity
Difference from UK salary in £
Difference from UK in %
Population per lower/salary single chamber member in thousands
UK
60,675
n/a
n/a
94
Australia
56,471
‐4,204
‐7%
133
Canada
75,779
+15,104
+25%
107
France
57,941
‐2,734
‐5%
111
Germany
59,231
‐1,444
‐2%
134
Ireland
58,866– 62,621
‐1,809– +1946
‐3%–+3%
24
Italy
101,039
+40,364
+67%
94
64,336
+3,661
+6%
113
51,471
‐9,204
‐15%
33
Norway
43,621
‐17,054
‐28%
30
Spain
29,233
‐31,442
‐52%
129
Sweden
42,805
‐17,870
‐29%
26
101,975
+41,300
+68%
696
Netherlands New Zealand
USA
Notes (i) This table compares gross base salaries, before tax, social security, pension contributions, etc. They take no account of allowances, free travel and other entitlements. Most salaries for members of Parliaments are taken from the respective Parliament or Government websites but data for Ireland and Norway were obtained from official sources in those countries. Salaries for Heads of Government were taken from official sources where possible but some are based on press reports. The figures were checked on 15 November 2007. (ii) Purchasing Power Parities (PPP) are used to convert salaries in national currencies to the equivalent purchasing power in Sterling. This provides a better comparison of relative value than conversion using (often more volatile) exchange rates. The PPP rates have been calculated from the OECD 2006 PPP rates, the latest available. (iii) Currently salaries of members of the European Parliament (MEPs) are the same as those of members of EU national Parliaments, so MEPs from the UK are paid the same as MPs. However, MEPs’ allowances are determined by the European Parliament. From 2009 MEPs will be paid 38.5% of the basic salary of a judge of the European Court of Justice.
15
Senior Salaries Review Body, Parliamentary pay, pensions and allowances 2007, Report No 64, January 2008, Cm 7270‐1, Appendix C: http://www.ome.uk.com/downloads/Review%20of%20Parlia mentary%20pay%202007%20volume%202.pdf.pdf.
9
Measured both by the sterling value of parliamentary salaries and by pay per size of population the member represents, the UK is close to the middle of the spectrum: Figure 4: Members of Parliament salaries (equivalent in £)16
Figure 5: Members of Parliament salaries per thousands of people represented (equivalent in £)17
1.4 RELATIVE WAGE RISES Nor have MP’s salaries fallen behind the national average wage: Figure 6: MP’s salary and other indices (1990 = 100) 18
16
For Ireland, an average of the maximum and minimum salaries has been used. For Ireland, an average of the maximum and minimum salaries has been used. 18 Senior Salaries Review Body (January 2008), Review of Parliamentary pay, pensions and allowances 2007: http://www.ome.uk.com/downloads/Review%20of%20Parliamentary%20pay%202007%20volume%201.pdf.pdf, p14. 17
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1.5 PENSIONS In order to calculate the actual value of an MP’s total compensation package it is also necessary to take into account the Commons pension scheme. MPs are currently enrolled in an unusually generous pension scheme, even among other public sector bodies. Members can choose an accrual rate of 1/40th or 1/50th, meaning that for every ten years' service they are entitled to receive a pension worth a quarter of their final salary, i.e., an MP voted out in 2010 after just five years' service would receive £8095.75 per year from the age of 65, (over 38% more than the basic state pension of £4953 per year).19 MPs’ accrual rates also compare favourably with a normal accrual rate in the public sector of 1/80th, and one of 1/60th in the private sector.20 The SSRB calculated in 2007 that the Exchequer would need to contribute 20% or 22% of a Member's pensionable pay (depending upon whether the Member contributed at the then‐ standard rates of 6% or 10%). This compared favourably with other public sector pension schemes: Figure 7: Exchequer contributions to associated pension benefits as a percentage of pensionable pay21 (Source: Watson Wyatt) Pension Scheme Parliamentary Pension Fund – 40th accrual rate (before max. benefits)1 Parliamentary Pension Fund – 50th accrual rate (before maximum benefits)1 Armed Forces (Colonel) 2 Civil servic2 Local government2 NHS32 Police (Chief superintendent) 2 Teachers2 Private sector (median)
Defined benefit % of pensionable pay 22
20
28 18 11 13 11 13 17
19
DirectGov, “Understanding the Basic State Pension: http://www.direct.gov.uk/en/Pensionsandretirementplanning/St atePension/Basicstatepension/DG_10014671 20 th 1/80 is the common accrual rate for NHS workers and teachers: http://www.iea.org.uk/files/upld‐book428pdf?.pdf, th p13; 1/60 is the most common accrual rate for private sector workers on a defined benefit scheme: http://www.ifs.org.uk/wps/wp1707.pdf, p12. Accompanying Notes: 1. For an average PCPF member aged 54. See Vol 2 for the full assumptions; 2. See Vol 2 for changes to be introduced to the above public sector schemes other than the PCPF. 21 Senior Salaries Review Body (January 2008), Review of Parliamentary pay, pensions and allowances 2007: http://www.ome.uk.com/downloads/Review%20of%20Parliame ntary%20pay%202007%20volume%201.pdf.pdf, p28.
The above‐stated Exchequer contribution rate was revised, however, this year. According to the Leader of the House, Harriet Harman, increased life expectancy meant that Exchequer contributions were going to have to rise further above the SSRB's recommended level of 20%. In response, Harman announced that the cap on accrual (set at 2/3 of final salary) would be extended to a formerly excluded group of MPs (those MPs over 65 who joined the scheme before June 1989). In addition, Member contributions rose: Figure 8: MP contribution and accrual rates22 Former Revised Accrual rate Member Member contribute contribution rate (% of (% of salary) salary) 6.00% 7.90% 1/50th 10.00% 11.90% 1/40th Harman assured Parliament that these measures would bring the Exchequer contribution back down to its acceptable 20% level. In order to determine whether the Government Actuary is correct in this forecast, it would be necessary to conduct a full review of its assumptions and calculations, e.g., its investment strategy and stock market forecasts. The SSRB is currently engaged in this review and will report later this year. It is certainly true that Exchequer contributions have risen disproportionately in the past six years (from 13% to 32.2%)23,24, although this was in part to make up for its under‐contribution since 1989.25 It remains to be seen if the SSRB will recommend significant changes that will reduce the Exchequer contribution to its previously recommended 20% level. For the moment, however, Exchequer contributions remain at 31.6% of Members' pension fund. MPs' pensions are therefore worth between £12,953 (at the SRRB’s unmet target of 20% contributions) and £20,466 per year (at this year's actual contribution level).
22
Written ministerial statement from the Leader of the House of st Commons, Harriet Harman, 31 March 2009. 23 For the 13% figure, see Figure 7. 24 For the 32.3% figure, see Written Ministerial Statement from st the Leader of the House of Commons, Harriet Harman, 31 March 2009. 25 For further details, see Senior Salaries Review Body (January 2008), Review of Parliamentary pay, pensions and allowances 2007: http://www.ome.uk.com/downloads/Review%20of%20Parlia mentary%20pay%202007%20volume%201.pdf.pdf, p26.
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1.6 PERKS
1.7 OVERALL
Finally, MPs’ salaries are supplemented by several perks, some taxable and some not. (Note: these perks are distinct from expenses, which are listed in the next section, in that they do not exist solely for the stated purpose of enabling an MP to do her job). Of note are:
While it might be true that the government used the expenses system as a way to covertly supplement basic pay, it does not therefore follow that MPs’ pay is insufficient. By most measures MPs are well‐paid. We suggest that the impression otherwise originates in the comparatively high pay of those in the social sphere that many MPs occupy, a factor that it would be perverse for Parliament to take into account if it aims to attract Members of increasingly diverse socio‐economic backgrounds.
‐
‐
‐
‐
‐
The free service of a parliamentary tax advisor, enabling MPs to avoid navigating the complex tax system themselves or paying privately for an accountant. Spouse and children can expense 30 round trips between an MP's constituency and Westminster. Redundancy and “winding‐up” payments upon retirement or election defeat (see Section 2.3 for details). Subsidised food and drink available in the House's restaurants, at a cost to the taxpayer of £6.1million (2007‐2008).26 (Conservative leader David Cameron recently promised to abolish this subsidy if his party wins power in 2010). Ministers also benefit from the use of the Government Car Service to take them to and fro. In 2007‐08, the CGS had 168 drivers and 171 cars at a cost of £14 million in car services.27
26
An FOI made publicly through WhatDoTheyKnow.com: http://www.whatdotheyknow.com/request/subsidies_on_mps _facilities_at_w. 27 Government Car Service annual report 2007‐2008: http://www.dft.gov.uk/gcda/docs/GCDA%20Annual%20Report %20and%20Accounts%202007‐08.pdf, all three quoted figures available, respectively, on p. 21, p. 171 and p. 36.
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2 HOW EXPENSES WORK
Few people have a clear grasp of the administrative system operating within the House of Commons. Both MPs and newspaper articles frequently refer to the vague “House/Commons authorities” and the “Fees Office,” the latter of which no longer exists (it was absorbed into a new body called the “Operations Directorate” in 2001).28 Many MPs are also in the dark about what regulatory, advisory, and administrative bodies contribute to the rules and guidelines governing their expenses. This section will therefore briefly outline the situation that MPs encounter upon entry to the House of Commons and then explain, in some detail, the network of committees and administrative bodies operating behind the scenes. Finally, for reference, it will briefly enumerate the type and amount of MPs' currently claimable expenses.
2.1 THE NEW MP MPs have several sources of information when it comes to using their expenses: ‐ the Operations Directorate (incorporates what was formerly called the “Fees Office”) o Expenses Advice Team (EAT): an advice phone line for Members. o The Green Book, written by the Committee on Members’ Allowances with occasional minor alterations by the Members' Estimate Committee and the Committee on Members' Allowances (the Green Book's length, however, makes it unlikely reading material for a busy, new
28
Examples of “House Authorities” or “Commons Authorities” use: Harriet Harman – http://www.publications.parliament.uk/pa/cm200809/cmhans rd/cm090128/text/90128w0009.htm; ePolitix: http://www.epolitix.com/latestnews/article‐ detail/newsarticle/commons‐pressured‐on‐union‐recognition/; David Amess MP – http://www.publications.parliament.uk/pa/cm200809/cmhans rd/cm090128/text/90128w0009.htm; The Guardian: http://www.guardian.co.uk/politics/blog/2009/may/08/mps‐ expenses‐leak‐police‐investigation. Examples of incorrect “Fees Office” use: The Scotsman ‐ http://news.scotsman.com/politiciansexpenses/Commons‐ Fees‐Office‐staff‐.5519795.jp; Telegraph – http://www.telegraph.co.uk/news/newstopics/mps‐ expenses/5340392/MPs‐expenses‐secretive‐fees‐office‐ exposed.html; The Guardian – http://www.guardian.co.uk/commentisfree/2009/may/15/co mmons‐fees‐office‐mps‐expenses; the BBC – http://news.bbc.co.uk/1/hi/uk_politics/8104383.stm#duncan_ alan.
‐ ‐
‐
Member. MPs might, however, consult it as issues arise). o Induction: optional organized meetings after a General Election and optional one‐ on‐one meetings. o Supplementary written materials on particular areas of concern. Practice notes: written by the Committee on Members' Allowances. Other MPs, particularly senior MPs who have been in the House a long time and “know the ropes.” The Party or Whips: central party authorities, induction meetings or conversations with the Whips might give new MPs to know what constitutes appropriate use of their expenses.
They are also face conflicting pressures: ‐ Public pressure to appear virtuous under the scrutiny of constituents and newspapers. Some MPs were aware that information would come out and some were not, but this pressure seems likely to be particularly strong in marginal constituencies, where small numbers of votes count. ‐ Peer pressure to do what others are doing (not to be outright fraudulent or a “goody‐ two‐shoes”). ‐ Political pressure from the Party to make sure its image is not tarnished. ‐ Personal moral pressure to do what they think is right. ‐ Pressure to obey the rules for fear of sanction, e.g., temporary suspension from Parliament ‐ Time pressure to instantly get on top of casework, join committees, examine legislation, etc. This time pressure is particularly exacerbated after a General Election by the slowness of House administration, e.g., it can take months for an MP to gain access to an office and a phone in the Commons and for computer equipment to arrive. In a 2005 meeting of the Administration Committee, Grant Shapps MP complained particularly about the backlog of waiting required to give new MPs offices after the Election. His comments give an interesting snapshot of the parliamentary culture into which new MPs are inducted: “[MPs’ refusal to leave comfortable offices] is all synonymous with the wrong culture here. It is absolutely
13
ridiculous that we should have to wait for six to eight weeks for offices. I think that about a fortnight is reasonable. When people have lost, they should move out; when they have been downgraded in their jobs, they should move. All this would never ever happen in a business. The only reason why it happens is because there are no financial implications for which anyone is accountable. It is as simple as that. It is completely the wrong culture.”29
2.2
HOUSE OF COMMONS ADMINISTRATION
2.2.i Necessary Functions There are, loosely, eight necessary functions of the expenses system: ‐ Establishing the principles that should inform an MP's conduct. ‐ Establishing the rules that determine what use is and is not allowable. ‐ Passing on the above information and expectations to MPs. ‐ Administering the expenses themselves and refusing incorrect claims. ‐ Auditing receipts and claims to make sure they comply with the rules and principles. ‐ Investigating complaints or dubious claims, judging whether they comply and, if not, determining whether the MP's actions were negligent or devious. ‐ Deciding upon and imposing some form of sanction for those who have not complied. ‐ Publicising the entirety of this process and all related documents and records, including letting the public know how they can lodge complaints and access information. These functions are not, however, simply divided among the different parliamentary bodies. Instead, a range of Members' committees, bureaucracies, and appointed committees share in numerous parts of these functions. 2.2.ii The Proliferation of Committees The proliferation of committees concerned with expenses and Commons administration coincided, perhaps unsurprisingly, with the gradual introduction and growing value and complication of different types of expenses (see section 2.3 for the dates when different expenses were introduced). It fell to the House of Commons Commission, as the legislative sub‐body in charge of Commons
29
Administration Committee First Report of the Session 2005‐06: http://www.publications.parliament.uk/pa/cm200506 /cmselect/cmadmin/777/777.pdf, p28.
administration, to introduce different bodies as it saw fit. Instead of systematically dividing up expenses‐related functions, the Commission created and disbanded committees and bureaucracies on an ad hoc basis. It is particularly notable that eleven of the seventeen relevant sixteen bodies were created in the last fifteen years, with five of them created since 2000 alone (see Section 2.2.iv). One salient priority in all reforms has always been to maintain the sovereignty of Parliament while taking direct control over MPs' pay and expenses away from the House. Bills relating to pay and expenses therefore usually emerge from a collaboration between the Commons Commission and the Government, to be debated and voted upon by the House. This has often resulted in wholesale adoption of policies recommended by various committees or quasi‐independent bodies, but in some cases, it has enabled the House to cherry‐pick only favourable recommendations and to discard others, e.g., the Senior Salaries Review Body complained of the Commons “cherry‐picking” its proposals in its recent evidence to the Committee on Standards in Public Life.30 2.2.iii A FLOW‐CHART: Visualising Parliamentary Administration Figure 9 (page 15) represents an attempt to visualise the administrative bodies that deal with MPs' expenses.
30
SSRB evidence: http://www.public‐ standards.gov.uk/Library/MP_Expenses_E680_Senior _Salaries_Review_Body.pdf, p2.
14
Figure 9: Visualisation of House of Commons and Expenses Administration31
Notes: bills regarding the expenses system in fact come from discussions between the MEC and the government, not the Commission as shown. Since the Commission and the MEC have the same membership, however, the arrows shown have been simplified. House of Commons administration and the administration of expenses take place in separate systems. The blue‐highlighted area on the flow‐chart shows Commons committees relating to the House’s administration. For more detail on House of Commons Administration, including the official “Organogram” of its internal bodies, see Appendix A.
31
Compiled from communication with officials and numerous committee and organisation websites given as sources for Figure 11.
15
‐ SOME CONCLUSIONS: UNCLEAR REPORTING RELATIONSHIPS AND DECISION‐MAKING RIGHTS ‐ It is impossible to create a simple flow‐chart demonstrating clear relationships between the various committees; instead, many of them seem to “float” alongside one another in undetermined relationships, occasionally sharing information. ‐ Incremental role adjustments and name‐ changes have added to the sense of confusion surrounding Commons administration. ‐ Ultimately, this means that it is not clear which body is responsible for decisions relating to MPs’ expenses. LACK OF COORDINATION AND INFORMATION‐ SHARING ‐ Committees share information on an ad hoc basis. There is no clear system for pooling information or preventing overlaps. Instead, anybody might or might not draw upon the published reports of another when deliberating upon an issue. Furthermore, members of various bodies do not always know that their colleagues have produced and published information related to their own inquiries.32 ‐ The only instance in which a committee might draw upon all the available information and reports is during a detailed review of a particular issue, e.g., the inquiry in MPs' expenses currently being undertaken by the Sir Christopher Kelly and the Committee on Standards in Public Life (CSPL). In such cases, however, committees themselves do not formally give evidence, although individual members of different committees might volunteer their personal view based on experience. FURTHER UNNECESSARY PROLIFERATION: IPSA AND THE INDEPENDENT COMMISSIONER ‐ Similarly, the Independent Parliament Standards Authority (IPSA) and its attached Commissioner for Parliamentary Investigations, recently created by the Parliamentary Standards Act (July 2009), do not have clear relationships to any of the existing bodies, nor requirements to report all of their activities.
32
For an example, see: Administration Committee Post‐ Election Services Report, 2005‐2006, Kevan Jones MP’s request for a copy of the annual Senior Salaries Review Body report, which is published online: http://www.publications.parliament.uk/pa/cm200506/cmsel ect/cmadmin/777/777.pdf, p 42.
‐
‐
‐
‐
‐
There is nothing in the Act to define how IPSA will relate to most of the other committees and administrations. Instead, IPSA is merely required to “consult” at least nine separate bodies or officials when reviewing the rules, whereupon the Speaker takes control of laying its proposals before the House.33 The Committee on Standards and Privileges has the right to “accept, modify or reject” any of the IPSA’s recommendations in relation to disciplinary action. In relation to releasing information, the Bill is silent other than to say, “The IPSA may publish a direction it has given.”34 The position of the newly created Commissioner for Investigations is similarly undetermined in relation to the committees and to the existing Commissioner for Standards, as is the nature of this office's attachment to IPSA. All details on how IPSA will relate to the newly created Commissioner, the Committee on Standards in Public Life, the Director of Public Prosecutions, the police, or anyone else, are left up to IPSA to decide in consultation with the CSPL. The Commissioner cannot, therefore, be said to be independent.35 The Commissioner is not charged to report or publish her findings in cases where the Member has simply paid back the incorrectly claimed expense, nor is she required to publish details of dismissed complaints.36 2.2.iv Administrative Functions: A more detailed look37 Figure 11, below, provides more detail on the various bodies that appear in the above flow‐ chart (Figure 10)
33
Parliamentary Standards Bill: http://www.parliament.uk/documents/upload/parlystan‐ bill.pdf, p2. 34 Parliamentary Standards Bill: http://www.parliament.uk/documents/upload/parlystan‐ bill.pdf, p6. 35 Parliamentary Standards Bill: http://www.parliament.uk/documents/upload/parlystan‐ bill.pdf, p6. 36 Parliamentary Standards Bill: http://www.parliament.uk/documents/upload/parlystan‐ bill.pdf, p5. 37 Information compiled from the parliamentary websites of the various bodies mentioned and from communications with Parliamentary and government officials.
16
Figure 10: Detailed information on Administrative Bodies Note: This is not an exhaustive list of information about the relevant bodies. It also does not lay out, in detail, the internal workings of House administration (readers interested in the House’s running can view the official “organogram” of its structure in Appendix A). Instead, this table is primarily focused on different bodies’ functions and publications as they relate to the expenses system.
Body
Founded
Current Stated function as it relates to either chair/head House of Commons Administration or MPs’ Expenses
Publications
Membership
House of Commons Commission38
1978
Speaker John Bercow MP
Responsible for supervising the administrative rules and running of the House of Commons, including approving the level of pay for House staff. Works with the government to put bills related to Commons administration before the House. Establishes other Committees, e.g., the Members Estimate Committee.
Meeting minutes since 2008; annual reports since 1998.
Five MPs: the Speaker, the Leader, Shadow Leader and three other MPs.
Finance and Services Committee39
1999
Sir Stuart Bell MP
Produces and scrutinises House of Commons budget; monitors spending; approves expenses Practice Notes.
Meeting minutes since 2005.
Eleven MPs.
Administration Committee (formerly five separate domestic Committees of the House)40
1998/ 2005
Frank Doran MP
Was originally four Commons committees on domestic administration; combined in 2005. Considers services provided to MPs and the public by the House e.g., catering, breastfeeding in the House.41 Represents MPs' views to the Commission. Established to incorporate views of five former domestic committees (e.g. Catering and Information).
Meeting minutes since 1999; special reports on select issues as well as written and oral evidence given for reports, e.g., IT provision in the Commons.
Nine MPs.
38
House of Commons Commission website: http://www.parliament.uk/about_commons/house_of_commons_commission_.cfm Finance and Services Committee website: http://www.parliament.uk/parliamentary_committees/finance_and_services_committee.cfm 40 Administration Committee website: http://www.parliament.uk/parliamentary_committees/admin.cfm. This should not be confused with the pre‐2005 Administration Committee website, when the AC was one of four domestic Committees of the House. In 2005 these four committees were merged and their responsibilities taken over by what present Administration Committee. The pre‐2005 AC website can be found here: http://www.parliament.uk/parliamentary_committees/administration_committee.cfm 41 For deliberations on breastfeeding in the Commons, see: http://www.publications.parliament.uk/pa/cm200001/cmselect/cmadmin/478/47803.htm#1b, http://www.publications.parliament.uk/pa/cm200001/cmselect/cmadmin/478/47803.htm#1a 39
17
Administration Estimate Audit Committee (AEAC)42
2000
Alan Duncan MP
To oversee the work of the House’s administration as it relates to auditing and efficiency savings; to monitor auditing and to receive auditing reports
Meeting minutes since 2005; brief annual report summarising its activities.
Three MPs, three experts – same membership as the Members Estimate Audit Committee, but is a separate committee.
Members Estimate Committee (MEC)43
2004
Speaker John Bercow MP
To codify, clarify and review resolutions relating to expenses, to approve and make minor changes or clarifications to the Green Book, to conduct periodic reviews e.g., recommending the introduction of a £10,000 Communications Allowance. To work with the government to put bills related to Commons administration before the House. Establishes other Committees, e.g., the MEC.
Meeting minutes since 2004; since 2007, one to three reports per year on special issues or reviews of the expenses system.
Five MPs – same membership as the House of Commons Commission.
Advisory Panel on Members’ Allowances (APMA)44
2001
abolished 2009
Abolished 2009 and replaced by Committee on Members’ Allowances. Formerly, its role was to draft the Green Book and Practice Notes and to advise the Members’ Estimates Committee and the Speaker.
None available.
Seven MPs.
Committee on Members’ Allowances (CMA)45
February 2009
Don Touhig MP
To advise the Members’ Estimate Committee; to draft and make clarifications to the Green Book, to produce Practice Notes to guide MPs' use of their expenses.
Meeting minutes.
Eight MPs.
Members Estimate Audit Committee (MEAC)46
2004
Alan Duncan MP
Established and appointed by the Members’ Estimate Committee. Role is to oversee the work of the Members’ Estimate Committee as it relates to auditing and efficiency savings; to monitor auditing and to receive auditing reports
Quarterly minutes; brief annual page reports since 2004 summarising meeting minutes.
Three MPs, three expert advisors.
42
Administration Estimate Audit Committee website: http://www.parliament.uk/about_commons/house_of_commons_commission_/audit_committee.cfm 43 Members Estimate Committee website: http://www.parliament.uk/parliamentary_committees/mec.cfm 44 Advisory Panel on Members’ Allowances website: http://www.parliament.uk/parliamentary_committees/apma.cfm. 45 Committee on Members’ Allowances website: http://www.parliament.uk/parliamentary_committees/cma.cfm. 46 Members Estimate Audit Committee website: http://www.parliament.uk/parliamentary_committees/meac.cfm.
18
Standards and Privileges Committee47
1997
Sir George Young MP
To oversee and vote upon the Commissioner's annual reports (in agreement or otherwise). To recommend sanctions based on findings of Commissioner.
Numerous brief reports detailing response to Commissioner’s verdict and recommendations, offering guidance on particular issues; transcripts of certain oral evidence; certain written evidence.
Ten MPs.
Parliamentary Commissioner on Standards48
1995
John Lyon
Selected and appointed by the Commission (subject to a Commons vote). Role is to investigate complaints about MPs relating to ethical conduct, e.g., expenses, interests; to report findings to Standards and Privileges Committee and, if desired, to recommend sanctions; to keep the Members' (and their staff's) Register of Interests.
Registers of interests; annual report giving statistics about number and nature of complaints, investigations and their results.
One non‐MP, appointed by the Prime Minister, for a fixed five‐year term.
Committee on Standards in Public Life (CSPL)49
1994
Sir Chris‐ topher Kelly
Monitor, report and make recommendations on ethical standards in public life, e.g., the use of MPs' expenses, appointment to public bodies, conflicts of interest.
Annual reports; special inquiry reports as well as written and oral evidence given for reports, meeting minutes since 2008.
Ten members appointed by the Prime Minister, including two MPs.
Senior Salaries Review Body (SSRB)50
1971
Bill Cockburn
To periodically review and make recommendations upon the levels of senior public servants' salaries, expenses, pensions and redundancy packages, including that of MPs. Established first as the “Top Salaries Review Body.”
Detailed review of MPs' every four years; other supplementary reports as requested by the Members Estimate Committee.
Ten members, appointed by Prime Minister after advertisement and application
47
Standards and Privileges Committee website: http://www.parliament.uk/parliamentary_committees/standards_and_privileges.cfm. 48 Commissioner for Standards website: http://www.parliament.uk/about_commons/pcfs.cfm and Fact Sheet, 2007: http://www.parliament.uk/commons/lib/research/briefings/snpc‐04507.pdf. 49 Committee on Standards in Public Life website: http://www.public‐standards.gov.uk/. 50 Senior Salaries Review Body website: http://www.ome.uk.com/review.cfm?body=4.
19
Department of Resources51
1968/ 2007
Andrew Walker, Director General
Was, until 2007, the Department of Finance and Administration, established 1968. One of the five administrative departments of the House of Commons.
None.
Administrative body.
Operations Directorate (incorporates the former “Fees Office” functions)
2001
Terry Bird, Director
A subsection of the Department of Resources; incorporates former Fees Office's functions, e.g., checking expense forms and reimbursing MPs or refusing claims (as of January 2009, dealt with about 5,000 claims per month), giving advice to MPs on their expenses. Includes the Expenses Advice Team, which gives members advice about claims (as of January 2009, dealt with about 2,500 calls per month).52
The Operations Directorate performed the redaction and publication of expense receipts in July 2009.
Administrative body. Figures published in 2004 list 75 staff.53
National Audit Office (NAO)
1983
John Buckley
Responsible for auditing public bodies; audits expenses on an ad hoc basis, as requested by the House. Up to now, expenses audits have been extremely limited in scope due to lack of receipts and a mandate only to check that claims were filed correctly (not that the money claimed was actually spent as stated). The first full audit of expenses is now planned for the 2009‐2010 Parliament. The NAO also provides advice, in the form of memoranda, to the MEAC and the AEAC.
If and when the Auditor General’s opinion on expenses is solicited, his report is published in the annual Members Estimate accounts.54 Advisory memoranda to the MEAC and AEAC are not published.
Administrative body.
51
Parliament website on departments of the House of Commons: http://www.parliament.uk/about_commons/commonshro/departments.cfm#finance. 52 Monthly claims and calls figures from minutes of Administration Committee meeting, January 2009: http://www.parliament.uk/documents/upload/AdminPI02‐130109.pdf, p3. 53 http://www.publications.parliament.uk/pa/cm200304/cmhansrd/vo040518/text/40518w08.htm 54 For the Auditor General’s 2008‐2009 report, see the Members Estimate Accounts 2008‐2009: http://www.publications.parliament.uk/pa/cm200809/cmselect/cmcomm/955/955.pdf, p21‐24.
20
Comptroller and 1866/ Auditor General 1983
John Buckley
Government Actuary Department55
Trevor Serves most of the UK government. Llanwarne Supplies actuarial reports as requested.
1919
Formalised in 1983 as the head of the National Audit Office. Appointed by the Queen on recommendation of the Prime Minister.
See above.
Not applicable.
Reports on Commons administration and MP pay are released according to the decision of the Commons Commission.
Seven‐person management board, 45 staff.
55
Government Actuary website: http://www.gad.gov.uk/About_GAD/.
21
2.3 THE ALLOWANCES: A BRIEF LOOK Below is a brief table of the different expenses, their date of introduction, amount, restrictions and the evidence required to claim them. More detailed information is readily available on the House of Commons website and has been widely circulated. It is provided here for reference.56 Figure 11: List of expenses Expense and purpose
When introduced
Maximum amount and specific uses/restrictions
Evidence required to claim
PAAE (i.e., the 1971 Accommodation Allowance, formerly the “ACA”). Because MPs have to work both in London and their constituency, they can expense the cost of living in the secondary location.
£24,222 can be claimed towards rent, mortgage interest, hotel costs, council tax, insurance, utility bills, service charges.
Annual statement of interest, copy of lease agreement, hotel bill, invoices or annual statement for monthly costs.
Subsistence Pay: for food 2009 and non‐alcoholic drink.
£25 per night spent away from a Member's “main home.”
Administrative and Office 1969 Expenditure (AOE). Formerly the Incidental Expenses Provision (IEP).
£22,393 on office rent, equipment, A copy of lease facilities and services for MPs and their agreement, receipts for staff. all services and equipment, copy of agreement if renting office from political party, contracts for services, receipts for petty cash of over £25.
Staffing Allowance: MPs cannot employ children (since 2008) but can employ other relatives
1981
£103,812 on staff salaries, brought‐in services, redundancy costs and settlements made at tribunal hearings
A copy of the contract and job description for each staff‐member, a form for changes in salary, invoices for brought‐in services.
Travel Expenditure: MPs and their staff can expense travel within their constituency and between their constituency and Westminster.
1980
No limit. Mileage – Car: 40p per mile for the first 40,000miles, 25p per mile thereafter; Motorbike: 24p per mile; Bike: 20p per mile.
A signed travel card acknowledgement; no record required for mileage.
No record required.
56
Information compiled from: House of Commons Factsheet M5: http://www.parliament.uk/parliamentary_publications_and_archives/factsheets.cfm; House of Commons Green Book 2009: http://www.parliament.uk/documents/upload/GreenBook.pdf; MEC Review of Allowances, Third Report of the Session 2007‐08: http://www.publications.parliament.uk/pa/cm200708/cmselect/cmmemest/578/578i.pdf; and the Concordance of Resolutions released by the MEC, January 2005: http://www.publications.parliament.uk/pa/cm200405/cmselect/cmmemest/240/240ii.pdf .
22
Communications 2007 Allowance: Introduced 2007. Not permitted for spending on party political communications (e.g., campaign letters).
£10,400 on electronic and paper communications to constituents.
Copy of agreement for services from a party political organization, copy of agreement if sharing costs with another MP. No copy of the communication itself is required.
House Stationery and postage
1862
£7000 only for official correspondence that responds to a communication related to parliamentary duties, e.g., reply to a letter from a public body.
Ordered from House of Commons catalogue; no documentation of how it is used is required.
London Costs Allowance
1971
£7,500 available to any MP who Not applicable – the LCA chooses not to claim the is paid as part of salary (it Accommodation Allowance. Helps with is therefore taxable). the greater staff/office costs of the capital.
Resettlement Grant: Redundancy payment to all MPs who retire or are not re‐elected.
1971
Based on length of service, between 50% and 100% of annual salary.
Not applicable.
A third of the Staffing Expenditure allowance in use at the time of the Member's retirement or election defeat.
No record required.
Winding‐up Grant: 1994 reimbursement for parliamentary work done on behalf of a deceased, retiring or defeated Member.
The Green Book also contains further details pertaining to particular situations. Of note are the following: ‐ Definition of an MP's “main home” versus her “second home”: The 2006 Green Book stated, “The location of your main home will normally be a matter of fact. If you have more than one home, your main home will normally be the one where you spend more nights than any other.”57 However, the 2009 Green Book says only, “It is for a Member to determine where his or her main home is based on his or her circumstances.”58 ‐ MPs are not permitted to rent from themselves or close associates: “PAAE [the Accommodation Allowance] must not be used to meet the costs of renting a property from yourself; a partner or family member (including a spouse or civil partner); a close business associate; or an organisation or company in which you or a family member
57
House of Commons Green Book 2006: http://www.parliament.uk/documents/upload/HofCp sap.pdf, p11. 58 House of Commons Green Book 2009: http://www.parliament.uk/documents/upload/Green Book.pdf, p65.
‐
‐
have an interest (other than as an ordinary investor).”59 If renting an office from her party, an MP must seek a statement from an independent valuer to certify that the rent is not over market rates. If renting at under market rates, an MP must consult the Register of Interests to determine if the unusually cheap rent should be listed there.60 Staffing Expenditure cannot be used for self‐ promotional PR services, nor for payment of any staff who primarily perform party political tasks, e.g., canvassing. MPs are, however, not required to supply any evidence of how staff spend their time except for a copy of the job contract and an overall job description.
59
House of Commons Green Book 2009: http://www.parliament.uk/documents/upload/Green Book.pdf, p16. 60 House of Commons Green Book 2009: http://www.parliament.uk/documents/upload/Green Book.pdf, p22.
23
3 WHAT WORKS, WHAT DOESN’T requirements that accompany claims are stringent enough. 2.1.i WHAT WORKS ‐ The seven Nolan Principles of public life are sound.67 ‐ The Green Book is, by and large, sensible. It gives clear guidance and specific examples. ‐ The requirement that MPs sign a statement declaring that expenses are “wholly, necessarily and exclusively incurred [...] for the purpose of performing your Parliamentary duties” is sensible.
2.1 THE ALLOWANCES: “Wholly, Necessarily and Exclusively” On every expense form, next to the box in which MPs sign the claim, is a statement that declares that expense was “wholly, necessarily and exclusively incurred [...] for the purpose of performing your Parliamentary duties.”61 MPs seem to have interpreted this statement broadly. Some examples of items claimed that do not appear to fall into this remit include: ‐ Gardening bills62 ‐ Lavish redecorations63 ‐ PR, which is explicitly outlawed64 ‐ Party political leaflets, also explicitly outlawed65 ‐ The employment of a nanny66 It could be argued (as, indeed, it has been) that these claims resulted from a lack of specificity in the rules. Gardening is listed neither in the allowable nor inappropriate section of the Accommodation Allowance in the Green Book. It is not difficult, however, to determine whether the maintenance of a well‐contoured garden is a cost “wholly, necessarily and exclusively incurred” in the job of an MP. The Green Book is very specific in listing examples, for each expense, of improper and proper use. But the few points it left open to the interpretation of common sense were abused. In the light of this abuse, it is appropriate to question whether certain rules are more open to abuse than others, and whether the evidence‐
2.1.ii WHAT DOESN’T LACK OF REGULAR FULL‐SCOPE AUDITING The 2009‐2010 expenses will be the first ever to undergo a full audit by the National Audit Office. However, in his 2009 report to the Members Estimate Committee, the Auditor General reported that Members still had some way to go in order to produce auditable records: “there was insufficient information for a judgement to be made on whether the expenditure was in accordance with the House Resolutions and the Green Book rules, and whether expenditure was appropriately recorded.”68 MPs are not keeping thorough enough records in order to make auditing possible, and there is presently no statutory requirement for an annual full audit. Instead, auditing happens on an ad hoc basis. RECOMMENDATION: MPs should pass legislation requiring a full‐scope annual audit of expenses, to be published and reported to the House and the Commissioner for Standards. Moreover, new MPs should undergo induction training with the Fees Office in order to make them aware that expense records must be kept just as they would keep personal tax records in case of audit.
61
This statement is on almost every form, e.g., http://parliament.telegraph.co.uk/mpsexpenses/expense‐ microsite/uncensored‐files/Jacqui‐Smith/mp‐10549 62 Alan Duncan MP: http://www.telegraph.co.uk/news/newstopics/mps‐ expenses/5304976/Alan‐Duncan‐claimed‐thousands‐for‐ gardening‐MPs‐expenses.html. 63 Speaker John Bercow MP: http://www.telegraph.co.uk/news/newstopics/mps‐ expenses/5974009/MPs‐expenses‐speaker‐John‐Bercows‐ 20000‐bill‐for‐apartment.html. 64 Various MPs: http://www.timesonline.co.uk/tol/news/politics/article434724 9.ece. 65 Ruth Kelly MP: http://www.dailymail.co.uk/news/article‐ 491626/Ruth‐Kelly‐admits‐I‐spent‐taxpayers‐cash‐ propaganda.html. 66 Caroline Spelman MP: http://www.guardian.co.uk/politics/2009/feb/24/caroline‐ spelman.
67
The Nolan Principles were created by the first Chairman of the Committee on Standards in Public Life, Lord Nolan in 1995. They are: selflessness, integrity, objectivity, accountability, openness, honesty and leadership. They are briefly stated on the CSPL website: http://www.public‐standards.gov.uk/. 68 Members Estimate Accounts 2008‐2009: http://www.publications.parliament.uk/pa/cm200809/cmsele ct/cmcomm/955/955.pdf, p24.
24
PAAE (ACCOMMODATION ALLOWANCE) Mortgage interest claims abuse: Reimbursing MPs who choose to buy property with taxpayers' money results in the complex problem of what to do with the asset thereby obtained. Presently, MPs are allowed to keep the asset as if they had bought it themselves when, in fact, it belongs – at least in part – to the taxpayer. This is materially unfair, administratively complicated to resolve and gives the impression of profiteering on the part of MPs. House maintenance and furnishings abuse: The most problematic use of the Accommodation Allowance in this respect has been for the maintenance of gardens, the purchase of luxurious furnishings and the lavish redecoration of houses. Redecoration claims, in particular, have been abused through the practice of “flipping” main home designation (redecorating one's second home with taxpayer funds, then switching its designation to a main home and selling it off for profit). Moreover, although MPs have been required to submit receipts for these items, the Operations Directorate (Fees Office) has taken far too lenient a stance in approving almost any kind of cost associated with a home, and not just those necessary to the performance of parliamentary duties. Hotel bill misuse: MPs have extended this use of the allowance to include items beyond mere overnight accommodation, such as minibar use and the purchase of pornography. Despite seeing receipts for such items, the Operations Directorate did not refuse such claims. RECOMMENDATION: Give MPs the option of living free in government‐owned Olympic Village housing, with all maintenance and utilities included, or of receiving £1200 per month for rent and disallowing reimbursement for any housing‐related costs (e.g., council tax). Ban expensing mortgage interest.
SUBSISTENCE Unnecessary: It is unclear why MPs should require an extra £25 for food just because they are in a different location. MPs already have access to subsidised food in the House of Commons restaurants (at a cost of £6.1million to the taxpayer). While there might be reason for MPs who opt to stay in hotels while in London to be able to buy subsidised food, there is no need for this to extend to alcohol as well. RECOMMENDATION: Abolish the subsistence allowance; abolish the House of Common catering subsidy for all alcoholic drinks and reduce the Refreshment Department’s subsidy by half. AOE (OFFICE COSTS) Misuse: Receipts are not sufficiently checked to ensure that MPs are not claiming for expressly forbidden services such as PR. Insufficient registration: MPs do not, as a matter of course, list offices rented from political parties on the Register of Interests nor do they regularly publish office rental agreements. So it is impossible to know if an MP is receiving financial help from her party in the course of her constituency duties. RECOMMENDATION: Publish all claims and receipts online as they occur to allow the public to scrutinise claims over and above the Fees Office. Require office rental registration on the Register of Interests, even if the rental is not at below‐market rates. STAFFING ALLOWANCE Staff activities: MPs are not obliged to submit any evidence demonstrating that their employed staff a) does any of the work for which they are employed, b) does not spend a significant amount of their time on party political matters while being funded by the taxpayer. This has been exacerbated by the ability to employ family members who might not actually do any work for the claimed salary, might be less competent than an applicant selected through other means, and might cause managerial problems if in a position of authority.
25
RECOMMENDATION: Ban the employment of family members for salary and require staff to list all past (as well as present) political affiliation on the Register of Staff Interests. Ensure more reliable publication of staff contracts by make Parliament their official employer, rather than the individual MP. Finally, require MPs to advertise all jobs and internships for their office on a public database (such as W4MP) to ensure meritocratic access. TRAVEL ALLOWANCE Within‐constituency travel: MPs should itemise all journeys (to ensure they are for parliamentary, not personal, purposes) and supply receipts in order to claim them on expenses. Mileage unaccountability: No receipts are required to determine that the mileage claimed has genuinely been driven. Personal or political use: There is no evidence required to support the claim that any travel costs have been incurred during parliamentary business. In short, there is nothing to stop MPs claiming for almost every journey they make (except those abroad), whether or not it has anything to do with their job.
RECOMMENDATION: Abolish the Communications Allowance. Instead, fund necessary communications, as before, through the Office Costs Allowance and require publication of all non‐personal material sent to constituents. HOUSE STATIONERY AND POSTAGE Personal or political use: Again, there is no evidence required to determine how an MP has been using House of Commons stationery, meaning that it could be used for political purposes or personal gain. RECOMMENDATION: All letters written using House of Commons stationery should be published, unless there is significant reason not to under the Freedom of Information Act. LONDON COSTS ALLOWANCE In itself, the London Allowance is not open to abuse, but it was raised by over 250% last year, seemingly without justification (from £2,916 to £7,500).69 RECOMMENDATION: The London Allowance should be taken down to £4600 and up‐rated annually in accordance with government figures available for the regional RPI for London. After this adjustment, its use should also be expanded to include all those MPs with constituencies in Greater London. This would disqualify these MPs from use of the Accommodation Allowance.
RECOMMENDATION: Abolish funding for internal constituency travel and require MPs to supply receipts, itemise travel, and adhere to a Fees Office‐stated budget for the year. COMMUNICATIONS ALLOWANCE Political use: Since MPs are not required to submit or publish the communications for which they use this allowance, it is wide open to political abuse such as the postage of campaign materials and one‐sided newsletters. Incumbency: Even if the allowance is not directly abused, it gives the incumbent MP funds specifically for self‐promotion and therefore disadvantages challengers to the seat who do not have a £10,400 expense account upon which to draw for publicity.
RESETTLEMENT GRANT Principle: It is thoroughly inappropriate for MPs to effectively receive a redundancy payment for losing their seat. Incoming MPs campaign to enter Parliament for one term at a time and should have no assumptions about their re‐election; they cannot, therefore, be said to be made redundant after losing their seat. In addition, outgoing MPs
69
The most recent government figures available (http://www.statistics.gov.uk/articles/economic_trends/ET615W ingfield.pdf, p.40) that compare London prices with the rest of the UK suggest that living costs in London are 7.1% higher than the UK average. Taken as a percentage of MPs’ salaries, this equates to about £4,600.
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might well have lost their seat due to improper behaviour or incompetence and are, in such scenarios, being rewarded for their misconduct. WINDING‐UP ALLOWANCE Personal use: There is absolutely no evidence required to determine that outgoing MPs have taken the time to hand over important casework and tie up loose ends. Nor is there any statutory obligation upon them to do. In effect, this is a supplementary redundancy pay‐off. RECOMMENDATION: Abolish the Resettlement Grant and the Winding‐Up Alliance.
3.2 OUTSIDE INTERESTS: Lobbyists in the Woodwork The question of MPs’ salaries and expenses raises the issue of their supplementary remuneration from non‐parliamentary employment. Should MPs be allowed to hold second or supplementary jobs during their term of office? If so, how can we ensure that those who employ them are not in fact merely paying them to implement favourable legislative changes (i.e., corruptly lobbying)? We do not have a singular institutional view on whether MPs should be obliged to give up their second jobs. Arguments on one side include: MPs cannot be effective if they are working a second job; MPs are open to being illegitimately lobbied if they are allowed to accept money for non‐ parliamentary activities. On the other side, however, one can legitimately argue that: MPs without second jobs will exist in more of an artificial public‐service bubble, narrowing the range of their experiences; banning MPs from holding outside interests will not stop, but simply push corrupt lobbying further behind the scenes. Instead of focusing on whether outside interests should be allowed in any form, we will instead put forwards suggestions on what factors in the current system enable corrupt lobbying and how, if second jobs are to be retained, the rules could minimise corruption. The crucial focus of a good system should be publication, so as to enable citizens to inform themselves of an MP’s possible conflicts of interest.
We will therefore examine the way in which information about MPs’ outside interests should be published if they are to be allowed to keep their second jobs. 3.2.i WHAT WORKS ‐ MPs and their staff are already obliged to list organizations and individuals from whom they have received payments on the Register of Interests kept by the Commissioner for Standards. 3.2.ii WHAT DOESN’T ‐ There is no compulsory register of lobbyists and therefore no clear way for the public to know if an organisation from which an MP benefits financially is attempting to lobby Parliament on any issue. This means that the public cannot be sure of an MP’s motives when she amends and votes upon legislation. ‐ There is no significant sanction for failing to list an interest. ‐ The format of the Register of Interests, for both MPs and their staff, is far from ideal, being a collated .pdf file rather than a database in which remuneration can be easily summed and compared. ‐ The Register is not linked to from the parliamentary directory of MPs. RECOMMENDATION: Establish a compulsory, public Lobbyists’ Register for all those who wish to lobby elected representatives. Publish this and the current Register of Interests in a searchable format (e.g., Excel, or supply a downloadable .csv file) and place links to each Member’s entry in the parliament.uk directory. Moreover, make failing to declare an interest a serious offence, incurring potential suspension from Parliament, forced resignation from any government or committee post and, in many cases, a forced by‐election or debarring from office.
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of who is responsible for what because of committee name changes and incremental tweaking with the rules. This also means that no official or body feels its authority to be sufficiently robust as to impose significant sanctions on wrongdoers. Coupled with the current lack of transparency, this means that there is little deterrence for bad conduct.
3.3 ADMINSTRATION: The Buck Stops... Where? 3.3.i WHAT WORKS With almost every committee producing an annual report and many bodies providing their overall costs online, there has been a proliferation of information automatically available to the public each year. Moreover, the format and level of detail of this information has improved somewhat since around 2000, tending to move from brief summaries to more organized and detailed .pdf files. ‐ Committees are slowly improving the thoroughness with which they publish information, e.g., despite, censoring some of its evidence, the Committee on Standards in Public Life’s current review into MPs' expenses gives the public fairly comprehensive access to the oral and written evidence it received, as well as holding its hearings in public.70 ‐ The Freedom of Information Act has given citizens an avenue through which to track down and obtain information. It has also introduced parliamentary bodies to the notion that information about their internal workings might be requested, putting pressure on them to compile the information more efficiently and to behave more responsibly.
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3.3.ii WHAT DOESN’T Due to the uncontrolled growth of overlapping committees and bureaucracies, several issues have arisen: NO ACCOUNTABILITY When responsibility is dispersed and disorganised, it is easy to hide behind and blame “the system.” For example, because few people have a full grasp of who makes the rules and how, MPs feel licensed to blame the Operations Directorate (Fees Office) for approving dodgy claims and are not held to account as individuals. It is not clear who is to blame for bad rule‐ making or insufficient auditing, because no one body or individual holds the responsibility for these functions. It is particularly hard to keep track
RECOMMENDATION: Abolish most of the quango’s and committees involved in the rule‐ making process and imbue those remaining with real authority and responsibility. Publicise the internal workings of the system so that the public knows where credit and blame are due. UNUSEABLE INFORMATION There is no standard procedure or format for the release of information. Committee documents vary wildly in their level of detail (Minutes often reveal only that, “The committee deliberated”). It is very difficult to quickly compare information from different bodies and even harder to search and manipulate data, e.g., in order to answer a simple question, such as the total amount claimed under the Accommodation Allowance last year, it would take hours of reading expense claims, compiling numbers and adding them up. When requesting unpublished information under an FOI, it is necessary for interested parties to spend some time locating the body that might hold the information, and then guessing as to the format in which it is held so that it can be requested as precisely and effectively as possible. Many citizens will simply be deterred by the effort required. RECOMMENDATION: Establish a single MPs’ expenses bank account to automatically record transactions. Publish the bank statement and all records and receipts. Alongside this, parliamentary IT services should provide easy‐ to‐use databases for the entry and release of information.
70
The Committee has, thus far, refused to publish Heather Brooke’s evidence to the Kelly Inquiry unless it is redacted. It is nonetheless available on her website: http://www.yrtk.org/2009/a‐funny‐thing‐ happened‐to‐my‐parliamentary‐evidence/.
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Figure 12: Expenses administration ‐ the case for simplification71
WHY SIMPLIFY THE EXPENSES SYSTEM? Figures show that, as the expenses system has grown in scope and complication, workload and running costs have risen. The increasing number of enquiries to the Expenses Advice Team does not seem to have resulted in more appropriate claims. Indeed, many Members claimed to have been confused about the rules once their receipts were published by The Telegraph. Number of calls to the Expenses Advice Team (part of the Operations Directorate, or “Fees Office”)
Total number of claims made
Moreover, information obtained via a Freedom of Information Request by the Sunlight Centre shows that, despite the Fees Office’s budget rising for every one of the last four years, it has not been within budget once in the last three:
Total budget (£000)
These figures present a compelling case for having as few allowances, as little administrative confusion and as little complication in the rules as possible. Expenses are necessarily intricate and complex because MPs’ circumstances vary, but it is always a trade‐off between keeping costs down with simplicity, and paying more to cater to every possible eventuality.
LACK OF INTELLIGIBILITY It can sometimes be very difficult for the public or MPs to find a definitive interpretation of the rules. MPs do not generally devote time to reading the seventy‐page Green Book and to noting changes between editions. Moreover, the complex overlapping functions of administrative bodies might not be self‐consistent and can change rules or guidelines often, making it hard to keep track. This lack of definition also makes it hard for members of the public to inform themselves and debate the issues.
71
For both graphs in Figure 13, see Parliamentary Accounts 2008‐2009: http://www.publications.parliament.uk/pa/cm200809/cmselec t/cmcomm/955/955.pdf, p.9 and p.8 respectively. Table of Fees Office spending obtained via FOI request.
2005‐06 2006‐07 2007‐08 2008‐09
figure not supplied 1,531 2,148 2,333
Total actual (£000)
% ‐/+ total budget ‐
2,107 2,117 2,382 3,055
38.27 10.89 30.94
RECOMMENDATION: By reducing the number of bodies involved and making all information public, the system proposed in Section 4.2 would encourage MPs to interpret the rules in a way the public would find sensible, rather than in a way that is advantageous. NO PUBLICITY There are no easy avenues for officials to explain to the public how the administrative system works, nor how to access information. This means that many members of the public do not know how to properly lodge complaints (or even that such an action is possible).
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It also means that the media might miss important developments and not notice evidence of misconduct. This is of particular concern because the Commissioner for Standards was, at the end of Elizabeth Filkin's tenure in 2001, gagged – that is, explicitly barred from talking to the press.
3.4 OVERALL There are five main areas of concern that need to be addressed in order to construct an effective and ethical new expenses system: ‐ FAIRNESS o The range of reimbursable expenses and their use seems inappropriate. ‐ ACCOUNTABILITY o It is hard for the public to know whom to hold to account. o It is hard for the public to obtain clear information that they can use to hold individuals or bodies to account. ‐ TRANSPARENCY o There are not enough records kept and published to properly audit and check the use of expenses. o It can be difficult to get a definitive answer on specific questions about the use of expenses because there are so many authorities. ‐ DETERRENCE o Without punishment for misconduct, there is not enough incentive for MPs to behave well. ‐ PUBLICITY o Not enough people know about the possible avenues of complaint or published reports of misconduct. The next section will go into some recommendations in more detail.
RECOMMENDATION: The key change needed here is to make all information public and hold investigations publicly. With information published and responsibility concentrated among fewer bodies, there would be a greater incentive for the bodies involved to think of and implement effective changes. EFFECTIVENESS AND INEFFICIENCY The growing complexity of the expenses system has led costs and workload to spiral upwards – see Figure 13 for evidence of how rule changes and administrative confusion have increased costs. Moreover, even when improvements are suggested, it is unclear who has the responsibility for implementing them and how recommendations are used. This leads to administrative confusion, meaning that recommendations can be cherry‐picked to MPs' advantage and that valuable suggestions for improvement can be forgotten or left out. Moreover, because the main decision‐making bodies (the Members Estimate Committee and government) do not have defined relationships to various advisory and reporting bodies and because their meetings are not public, it is not possible to discover what role formal recommendations play in drawing up bills. RECOMMENDATION: Parliament should restore the Commissioner’s ability to speak to the press and introduce quarterly Commissioner’s press conferences, which would be videoed and available on the parliamentary website and in the library. Moreover, the Commissioner should hold her investigations under the public eye, with all evidence and hearings held in the open.
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4 RECOMMENDATIONS
1. SIMPLIFY AND SCALE BACK EXPENSES a. Provide housing for non‐London MPs in the Olympic Village b. Abolish or cut all supplementary pay outside the Cabinet 2. HOLD PARLIAMENT ACCOUNTABLE BY ABOLISHING REDUNDANT BODIES a. Cut expenses‐related committees and quango’s by over 60% b. Make the remaining bodies accountable and efficient 3. ESTBALISH A SINGLE MPs' BANK ACCOUNT, A PUBLIC DATABASE AND FULL AUDIT a. Give MPs a parliamentary debit card and a public Commons bank statement for expenses b. Bring Parliament up to date: Publish expenses in a searchable database c. Make annual full audit a statutory requirement 4. PUBLISH MORE AND OPEN UP ACCESS TO INFORMATION a. Make it a statutory requirement to publish every receipt, every refused claim and all formal Fees Office correspondence b. Hold open quarterly press conferences with the Commissioner for Standards c. Establish a compulsory Lobbyists’ Register so that the public can compare lobbyists’ activities with that of MPs listed on the Register of Interests 5. IMPOSE MEANINGFUL PENALTIES FOR BREAKING THE RULES a. Let citizens trigger a recall by‐election for erring MPs b. Have expense‐claiming MPs sign a legally binding contract to abide by the rules c. Formally enable the ejection and debarment of MPs who wilfully deceive
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‐ ‐ ‐
Overall we calculate that these measures will, over the course of current MPs’ careers, generate at least
‐
£75,837,445 in savings. This includes:
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Switching parliamentary pension scheme from defined benefit to defined contribution. Savings: £8,618,80 Scrapping all supplementary salaries except those of the Cabinet and Leader of Opposition and cutting junior ministerial pay to £10,000. Savings: £3,528,951 Scrapping the resettlement grant. Savings: £31,379,12772 Scrapping the winding‐up grant. Savings: £20,919,41873 Scrapping the communications allowance. Savings: £1,300,000.
72
Calculated by averaging the maximum and minimum resettlement grant permitted, using current salary levels. 73 Calculated using current Staffing Allowance levels, therefore likely to be an under‐estimation, since the Staffing Allowance amount tends to rise over time.
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Cutting down the government car service. Savings: £6,000,000 Halving the catering department subsidy. Savings: £3,050,000 This has yet to include savings made by stopping abuse and paring down the Accommodation Allowance, introducing individual MP travel budgets and cutting out the roles of various unnecessary parliamentary bodies. It should be offset against the cost of setting up an expenses database (estimated to be between £70,000 and £150,000 by Tom Steinberg of mysociety.org), implementing a full annual audit and scanning all receipts.74
74
Steinberg’s estimate is in the transcript of his CSPL oral evidence: http://www.publicstandards.gov.uk/Library/Committee_on_Standards_in_ Public_Life_1_30_06_09.doc , p.28.
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4.1 SIMPLIFY AND SCALE BACK EXPENSES
ABOLISH INAPPROPRIATE ALLOWANCES ABOLISH: ‐ The Subsistence Allowance ‐ The Communications Allowance ‐ The Resettlement Grant ‐ The Winding‐Up Grant ‐ The Parliamentary tax advisor ‐ Pay for Whips ‐ All supplementary pay except for Cabinet ministers and junior ministers, whose extra pay should be cut to £10,000 ‐ Junior ministerial use of the Government Car Service unless there can be shown to be a significant security reason ‐ The House of Commons catering subsidy for alcohol (and slash Commons catering subsidy by half) ‐ The parliamentary tax advisor. In addition to abolishing these allowances,75 we propose the following changes to those allowances remaining: THE ACCOMMODATION ALLOWANCE (renamed from the “PAAE” or the “ACA”) ‐ HOUSE MPs IN THE OLYMPIC VILLAGE Since the government is already investing in building the Olympic Village, it seems sensible to cut down on administrative costs by encouraging MPs to use some of the resulting public housing as their parliamentary accommodation. The Olympic Village is set to be a modern, secure complex of apartments with shops, transport links, and medical and leisure facilities nearby. The official Olympic website describes: “The plan retains London's tradition of building homes around communal squares and courtyards, with water features accentuating the closeness of the River Lea. Athletes will have an inspirational view over the Park. Every apartment will provide comfortable accommodation and state‐of‐the‐art communications facilities, including internet access and wireless networking. All the apartment blocks
75
There should be one exception to the abolition of the Winding‐Up Grant: MPs who have opted to lease a flat in London for accommodation and who are defeated in a General Election before their lease term is over should receive a lump sum equal to the amount necessary to pay the lease until it expires, as stated on the published lease contract. For this reason, leases should be limited to a maximum length of one year.
will be fully accessible and equipped with modern lifts.”76 Since the government will already own the complex, MPs will not have to bear the cost of utilities or maintenance and will avoid the stress and time spent finding a place to rent or buy. For MPs new to London, this will relieve them of a significant burden. While having all non‐London MPs in public housing would be convenient, however, there should nonetheless be a provision to allow those who strongly want to live elsewhere to do so. Given the abuses resulting from allowing MPs to expense mortgage interest, we recommend abolishing this provision entirely. Instead, MPs should be able to choose between: ‐ Living in the Olympic Village with all costs paid (e.g., maintenance, utilities). ‐ Expensing up to £1200 per month in rent without any extras paid (no utilities or maintenance). ‐ Expensing up to £1200 per month in hotel bills – but only for accommodation, not for extras such as room service. This range of options would allow for a reasonable mixture of choice, reducing the capacity for abuse and administrative simplicity. Figure 13: Artist's impression of the Olympic Village
THE FURNITURE ALLOWANCE (separated from the Accommodation Allowance) ‐ GIVE MPs A ONE‐OFF ALLOWANCE Moving into a new apartment does incur costs even without having to buy a new home. Instead of being able to claim annually for new furnishings, however, MPs should simply receive a one‐off allowance when they are elected. This should be set at £3000 and be automatically adjusted by pegging it to the RPI for furniture.
76
London 2012 Olympic website: http://www.london2012.com/plans/olympic‐park/games‐ time/the‐olympic‐village.php.
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STAFFING ALLOWANCE ‐ BAN EMPLOYMENT OF FAMILY While many family members work hard for Members, the abuse of this leniency has shown that a prohibition is necessary. A ban on politicians’ employment of relatives is already standard practice in the US and Germany and should become so here as well. 77 ‐ PUT ALL STAFF ON A CENTRAL CONTRACT One of the effective changes to emerge from the pre‐summer reforms was to transfer staff contracts to list the House of Commons as employer. Even informal work, such as that done by unpaid interns, can be employed on a contract (albeit a separate one from normal staff). Members should, however, retain responsibility for choosing whom they hire. ‐ LIST ALL PAST AND PRESENT POLITICAL AFFILIATIONS AND CAMPAIGNING ACTIVITIES Staff should not only have to declare any present political employment by a party, but should be required to list past employment and membership of parties. They should also have to publicly declare whenever they engage in political activity, e.g., canvassing votes, and list the date and political affiliation of the activity on the Register of Interests. ‐ INCLUDE CONSTITUENCY STAFF Constituency staff should be held to the same reporting standards as parliamentary pass‐holders, particularly since it is often in the constituency that party political activities, such as campaigning, take place. ‐ AVERTISE ALL JOBS WITH MPs CENTRALLY While MPs should ultimately retain control over whom they hire, they should be obliged to advertise all posts on a database such as W4MP.com so that all members of the public have equal access to political opportunities. TRAVEL ALLOWANCE ‐ ITEMISE ALL TRAVEL Most people have to list journeys for which they claim expense costs. There is no reason MPs should not have to briefly list the purpose and submit receipts for journeys for which they want to claim money, both within the constituency and between the constituency and Westminster. These details should be published in an accessible expenses database.
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SET AN ANNUAL BUDGET FOR TRAVEL Currently, there is no limit to the amount MPs can claim for travel. This should change and instead the default travel arrangements should be for MPs to receive an annual budget for Westminster‐constituency journeys, published by the Fees Office, equal to the cost of standard‐ class return ticket (by train or, where necessary, by plane) to their constituency for 52 weeks of the year. Expensing mileage should be permitted within this budget, subject to itemising journeys and providing receipts. Staff can continue to be able to expense necessary travel by public transport provided they submit receipts and log a reason for the journey, both to be published through an accessible expenses database. Within‐constituency travel can continue to be expensed on an ad hoc basis but should never include flights. If it is unusually high, it will be noticeable on any published expenses database. ‐ BAN INTERNATIONAL TRAVEL MPs should not be allowed to expense any international travel in the name of performing regular parliamentary duties. OFFICE ALLOWANCE (renamed from the “AOE” and the “IEP”) ‐ PUBLICATION The current rules on the Office Costs Allowance are reasonable and would be enforceable if backed up with proper audit trails, record‐ keeping, and running publication of those records. PENSIONS ‐ ADOPT THE PRIVATE‐SECTOR NORM MPs should have the integrity to switch their pension scheme to what is now becoming the private‐sector norm – a Defined Contribution Scheme instead of a Defined Benefit Scheme. Under a defined contribution scheme, MPs would only receive their pension in proportion to what they contribute, as opposed to being guaranteed a generous income tenuously related to their contributions, all funded by the taxpayer. Given their privileged position and a budget deficit of £175bn this year, MPs should lead the public sector by example in switching over to a fairer pensions scheme.78 ACRONYMS: Parliament should rename the allowances to avoid numerous acronyms, enabling them to be understood and tracked by those who do not follow parliamentary procedure closely.
77
See point 85 for ban on family employment in US and Germany: http://www.publications.parliament.uk/pa/cm200708 /cmselect/cmmemest/578/57805.htm.
78
Budget deficit: http://news.bbc.co.uk/1/hi/uk_politics/8011321.stm.
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4.2 HOLD PARLIAMENT TO ACCOUNT BY ABOLISHING ADMINISTRATIVE CONFUSION
Replace the administrative structure laid out in Figure 10 with the one laid out below: Figure 14: Proposal for a reformed administrative structure for MPs’ expenses
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CONCLUSIONS: RESPONSIBILITY CONCENTRATED Instead of dispersing decision‐making, record‐ keeping and responsibility among 50 people, this system concentrates ultimate responsibility for each stage of the expenses process in one or two bodies – 18 people: 79 Figure 15: Number of official roles in expenses system is dramatically reduced
Number of official roles involved in deciding, administering or enforcing expenses system
Present Structure
Sunlight proposed structure
% remaining
50
18
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‐
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One committee (The Committee on Members’ Allowances) is here responsible for constructing the principles and rules of the expenses system: Instead of blaming other committees or the Senior Salaries Review Body, the Commons would have to accept that it, as an institution, was responsible for the rules. Complaints that conduct was “within the rules” would therefore point the finger at Parliament – at MPs themselves, not at unaccountable bodies. Implementing the expenses system: By producing a simple database template, the IT Office could make it easy to keep good records. This, along with full publication of its activities, would incentivise the Fees Office to make sure the necessary information was collected and that claims were properly justified. Holding to account: The three bodies involved in this stage would place responsibility for each discrete function in separate places – for auditing, for investigating and judging, and for punishing. Moreover, these offices would function under the public eye, allowing the electorate
79
This would consist of: the MEC (five members), the SSRB (ten members), Standards and Privileges Committee (ten members), MEAC (six members), decrease the CSPL by one member.
to be the ultimate arbiter rather than committees or quango’s. Ultimately, in this system, because the results of the rules (i.e., all information) would be released, the public could judge MPs’ conduct, the rules, and their enforcement for themselves, without need for a middle‐man. MORE INFORMATION PUBLISHED This administrative structure also allows for four new modes of publication (highlighted on the diagram with green arrows): ‐ The Parliamentary Commissioner for Standards would publish evidence in her investigations as she went along, instead of waiting until the investigation is concluded. Moreover, she should hold evidence sessions in public. There is no reason that the principles of normal courtrooms should not apply to parliamentary investigations. ‐ The Fees Office would be obliged to publish refused claims and any correspondence relating to them. ‐ The National Audit Office should conduct and publish a thorough annual audit of certain randomly chosen MPs’ expenses and publish the resulting report. At present, there are not sufficient records kept to enable this and the Auditor General merely writes a memorandum detailing the attempted audit, which may or may not be published by the relevant committees each year. ‐ The publication of the House’s internal accounts and administrative workings. Currently, the different departments of the House do not even have their own websites and their accounts contain only very broad categories of spending. They should, instead, be held to the same standard as MPs’ expenses and use a similar database format for releasing information about their activities. ‐ Moreover, the information published would be easier to use and understand: The IT Office should be involved at an early stage so as to make it cost‐efficient and easy for the Fees Office to publish data in a useable format. The IT Office would respond to
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demands made by an Act of Parliament to produce a database in which the required data and evidence could be easily recorded and published. RIGHT OF APPEAL ‐ This structure also introduces a right of appeal to any complainant and any MP. If unhappy with the Commissioner’s verdict, complainants or MPs may appeal to the CSPL, which can decide if an appeal is merited and, if so, investigate the case.
ABOLISH REDUNDANT BODIES This proposed structure would also: ABOLISH: − The Standards and Privileges Committee − The Members’ Estimate Committee − The Members’ Estimate Audit Committee − The Administration Estimate Audit Committee − The Finance and Services Committee − The role of the Senior Salaries Review Body in expenses WHY ABOLISH THESE BODIES? WHY ABOLISH... The Standards & Privileges Committee: Although the Standards and Privileges Committee has performed some valuable tasks in the past, it does not make sense to continue to disperse responsibility for parliamentary standards between this committee and the CSPL. Duplication makes it harder for the public to understand and hold the House to account. Given this principle, there are several factors that weigh in favour of abolishing the Standards and Privileges Committee: ‐ Its track record on punishing misconduct among MPs is poor. o 2001: Despite avoidance and non‐ cooperation by Keith Vaz MP in the face of an investigation by then‐ Commissioner Elizabeth Filkin, the Committee on Standards in Public Life recommended no action be taken against the MP.80 o 2001: Despite misleading Filkin about the
80
BBC: http://news.bbc.co.uk/1/hi/uk_politics/1216410.stm.
receipt of a £200,000 cheque from a third‐party interest, Geoffrey Robinson MP received nothing more than an inconvenient three‐week suspension from Parliament.81 o 2006: The Committee recommended that no action be taken against John Prescott over his failure to fully declare his interests: He was gifted a stay at a luxurious ranch of an American tycoon but satisfied the Committee by declaring it once he had been investigated.82 o 2008: Derek Conway MP was investigated by the Commissioner for Standards in 2008 after improperly employing a second of his sons on parliamentary allowances. Despite this being the second offence and the son in question simultaneously being at university while supposedly working for his father, the Committee on Standards and Privileges decided that any punishment on top of that already served by Conway for his first offence would be “disproportionate.”83 ‐ It is a bad principle to place responsibility for Members' ethics solely in the hands of other Members. It is already a principle of our government that the judiciary should be separate from the legislature; that should stand for the running of Parliament as well. ‐ In order to keep some element of judgment by one’s peers, there should be more MPs on the CSPL. Instead of its current makeup, the CSPL should consist of four MPs and five independent appointees. WHY ABOLISH... The Members Estimate Committee: There is no reason to put control over bills on MPs' expenses and salaries in the hands of a committee chaired by the Speaker, half‐full of ministers and whose members are already occupied with the internal administration of the House itself. ‐ The Speaker already has inordinate control over the procedures and administration of the House and, given how hard it is to remove a Speaker (it has been achieved only twice in 314 years), it is thoroughly inappropriate that the position also include
81
The Guardian: http://www.guardian.co.uk/uk/2001/nov/26/houseofcommons. politics3De 82 BBC: http://news.bbc.co.uk/1/hi/uk_politics/5196152.stm. 83 Committee on Standards and Privileges report, 2008‐2009: http://www.publications.parliament.uk/pa/cm200809/cmselect/ cmstnprv/207/207.pdf.
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the chair of the central body of elected officials with control over parliamentary expenses.84 The other members (Leader of the House and Shadow Leader) similarly have too much vested in the House's reputation to be able to fairly consider the release of information and wide‐scale reform of the expenses system.
WHY ABOLISH... ‐ The Members Estimate Audit Committee (MEAC): o It does not make sense to artificially separate an analysis of the audit function from the investigatory functions of the expenses system. o Instead, audit should be part of the regular operation of the expenses system and MPs should not be the ones responsible for receiving audit reports of their own spending. o The MEAC’s track record is not impressive. It played little role in the introduction of a full‐scope auditing, perhaps because the Committee itself has no power, only an advisory function. ‐ The Audit Estimate Administration Committee (AEAC): o Since the members of the House of Commons commission will be relieved of their duties on the MEC, they will have extra time to receive and analyse House audit reports. The AEAC will therefore not be necessary. o As with the MEAC, it does not make sense to place auditing deliberation in a separate committee that merely advises House management. Instead the annual House audit should be both reported to the Commission and published, thereby streamlining the system and enabling the Commission to be held to account in its use of the information. ‐ The Finance and Services Committee: o This committee merely duplicates functions that should be taken on by the House of Commons Commission and, because of that, it disperses responsibility for the running of the House. ‐ The Role of the Senior Salaries Review Body in expenses:
84
The last speaker to be ejected before Michael Martin was Sir John Trevor in 1695: http://www.telegraph.co.uk/news/newstopics/mps‐ expenses/5351271/MPs‐expenses‐last‐time‐Speaker‐ was‐ejected‐from‐Commons‐was‐1695.html
o The Members’ Committee on Allowances would be responsible for drafting changes to the expenses system and calculating their cost. This would force the Commons to take responsibility for proposed changes, as opposed to simply pointing towards the unaccountable SSRB as the origin of the changes.85 NOTE: The recommendation to abolish these committees does not imply that all of their work and members are worthless. Many produce and publish valuable information and are committed to the House's effective and ethical functioning. It must be a priority, however, to make the expenses and administration system more understandable to the public, so that the correct people can be held to account.
STRENGTHEN THE ROLES OF REMAINING BODIES This structure would also: STRENGTHEN THE ROLE OF: − The Parliamentary Commissioner for Standards − The Committee on Standards in Public Life (CSPL) − The Committee on Members’ Allowances (CMA) − The Parliamentary IT Office STRENGTHEN THE COMMISSIONER’S ROLE AND INDEPENDENCE: Ultimately, the Commissioner for Standards should be an elected representative independent of all political parties. At the present moment, however, the Commissioner does not operate transparently enough, nor have a high enough profile to make election realistic. This option should, however, be seriously considered the next time House of Commons administration is reviewed. Instead of suggesting elections for the role of Commissioner, then, we propose that candidates for appointment to this role should be put forwards by the Committee on Standards in Public Life (CSPL), not by the House of Commons Commission. In selecting their candidate, the CSPL should publish all CVs submitted and hold interviews in public, with members of the public
85
The SSRB would still exist and continue to perform its role in other areas outside the remit of this report, e.g., setting top civil servant salaries.
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able to ask several questions of prospective candidates. As well as changing the way the Commissioner is appointed, we recommend that Parliament also add to her remit: ‐ The ability to initiate an investigation upon discovering something untoward (as opposed to only responding to complaints). ‐ The responsibility of receiving and examining an annual audit of MPs’ expenses conducted by the National Audit Office. ‐ A duty to hold quarterly press conference open to anyone who publicly registers to attend, providing monthly updates on all investigations. (Registration is to enable attendance for any member of the public, not just press, but to prevent parliamentary authorities packing the room and thereby excluding a hostile audience). ‐ A duty to publish all written and oral evidence received as the investigation proceeds, unless there is a compelling reason not to do so (under the terms of the Freedom of Information Act). STRENGTHEN THE ROLE OF THE COMMITTEE ON STANDARDS IN PUBLIC LIFE (CSPL): ‐ Give the Committee the role of putting forwards a candidate for the role of Commissioner for Standards. ‐ Remove three non‐elected members and include two more MPs (perhaps from the abolished Standards and Privileges Committee) for a total of four MPs and five appointees. ‐ Decide upon sanctions to be imposed on an MP for improper conduct. Available options should include: o Referral of case to police for prosecution for fraud o Bar from standing o Triggering a by‐election o Compulsory Fees Office training o Paying the benefit undeclared interest or improperly used expense to the Exchequer, plus a fine ‐ Receiving and deciding whether to grant appeals from complainants unhappy with the Commissioner’s investigation and verdict. If the appeal is granted, the CSPL should conduct the re‐opened investigation itself. STRENGTHEN THE ROLE OF THE COMMITTEE ON MEMBERS’ ALLOWANCES (CMA): Since members of the CMA already have expertise and interest in the reform of the
expenses system, they are well‐placed to replace the Members Estimate Committee. The CMA’s main responsibility should be to recommend changes to the expenses system (including setting the level of allowances), to solicit the opinions of experts, the public and MPs and to produce bills to implement its recommendations. It should also continue to be responsible for writing changes into the Green Book. ‐ In addition, the CMA should make sure that its proposals allow for easy collation and publican of data and for yearly auditing. ‐ In performing these responsibilities, the CMA has several advantages over the current Members Estimate Committee: o Its members can be removed from the committee more easily than can most members of the MEC, whose membership is derived from their holding another post o Its members are more likely to be backbenchers and will therefore have fewer vested interests in covering up problems as opposed to addressing them. STRENGTHEN THE ROLE OF THE PARLIAMENTARY IT OFFICE: The IT Office should have an immediate role after the passing of any Act that concerns record‐ keeping so that a standard record‐keeping format can be established. This will enable members of the public to search and compare information across different parliamentary bodies. In order to do this, it might be necessary to change some of the staff at the IT Office, who are merely accustomed to publishing .pdfs rather than coding databases. It would be wise to recruit programmers who have worked with open source software to design easy‐to‐use democracy sites such as mysociety.org. THE FEES OFFICE Finally, we would maintain the role of The Fees Office (renamed from the “Operations Directorate”), adding to its duties that of publishing all claims, supporting evidence and formal correspondence with members, including refused claims.
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4.3 ESTABLISH AN EXPENSES BANK ACCOUNT AND USER‐FRIENDLY DATABASE
Three simple measures would vastly increase the quality and accessibility of expense records: ‐ Establish a single MPs’ expense bank account and publish statements. ‐ Keep a comprehensive public database of every claim. ‐ Require an annual full‐scope audit of expenses. AN MPs’ EXPENSE BANK ACCOUNT MPs should pay for their expenses via debit card withdrawals from a SINGLE MPs' BANK ACCOUNT, with monthly statements publicly available online and in the House Library. The account should also publish running costs as funds are used, day‐by‐day. The MPs' Bank Account could either be run internally or contracted out to a third party bank and credited with the total calculated cost of all allowances at the beginning of each year. Since it will be run internally, the Bank Account will be able to have secure public access features, such as only displaying the bank account number and sort code to those with authorised access (i.e., MPs who need to make payments from the account). Figure 16: An MPs' expense debit card
Advantages of an MPs' Bank Account: ‐ Records of all payments and withdrawals will automatically be kept, in an easily understandable format ‐ It will encourage daily confidence in and scrutiny of the expenses system without any technical knowledge of Parliament, FOIs or phone calls required. ‐ It will encourage all Members to think of their use of expenses as a public act. A PUBLIC EXPENSE DATABASE As well as a single MPs' Bank Account, records of expenses should be kept in a search‐able format. A mock‐up of the kind of database that should be publicly available is included on page 40. ‐ This database should also be kept for MPs' staff and should be available free in the House of Commons Library for those without computer skills (with scans of receipts able to be printed out upon request). ‐ It should be constructed using an open source code so that other public bodies and members of the public can use and improve it. ‐ It should record all changes made to create an audit trail. FULL ANNUAL AUDIT Finally, MPs should make it a statutory requirement that the National Audit Office conduct, and publish, a full‐scope audit of MPs’ expenses every year. MPs who are concerned about how to keep the necessary records should seek advice from the NAO or Fees Office.
NOTE: The Bank Account statements should be published alongside receipts, not instead of them. For all cash withdrawals (for items that cannot be paid via debit card), MPs should attach a note to the statement with a link to scans of the receipts for these items (or to the relevant database entry that will, in turn, link to the scanned receipt).
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4.4 FULL PUBLICATION AND PUBLICITY
It should be a matter of course to publish all documents relating to expenses (and parliamentary administration) unless there is a compelling reason not to (specified as exceptions by the Freedom of Information Act, i.e., for serious privacy or security reasons). It is not enough to only supply information after three weeks of waiting for a response to an FOI. Parliament and MPs should regard their official activities as inherently public. The MPs' Bank Account and database described above will go a long way towards improving Parliament in this direction. In addition, Parliament should make the following changes: ‐ Remove the gag on the Commissioner: this means restoring to the Commissioner for Standards the ability to speak to the press that was abolished by Speaker Michael Martin in 2001. ‐ Establish quarterly Commissioner's press
conferences, with open access to any member of the public, to keep the public informed on investigations and complaints. Televise the press conferences on the Parliament Live TV site. ‐ Publish a full annual audit of MPs’ expenses. ‐ Publish all evidence in investigations unless there is a compelling reason not to as allowed for under the Freedom of Information Act (i.e., for compelling security or privacy reasons). As stated above, ultimately, the Commissioner for Standards should be an elected representative independent of all the main parties. Because current realities make this impractical (few people currently know who the Commissioner is), we instead advocate that the Committee on Standards in Public Life select a candidate for Commissioner in a fair and transparent process way, publishing all CVs and holding interviews in public.
FULL PUBLICATION: What does this mean in practice? ‐ ‐ ‐ ‐
‐ ‐ ‐
‐
It would mean the publication of every receipt, contract and lease agreement. It would mean publishing the results of a full‐scope audit every year (conducted by the National Audit Office). It would mean the publication of a parliamentary bank statement every month, so that taxpayers can keep track of their money. It would mean minimal redactions – that is, redaction only of information not in the public domain: staff addresses, national insurance numbers, account numbers and certain telephone numbers. It would mean the publication of all formal correspondence between MPs and the Fees Office. It would mean seeing all refused claims and the reason for their refusal. It would mean publication of all publishable material for which an allowance is used, e.g., any public communications funded by the Office Costs Allowance (after the abolition of the Communications Allowance) should be publicly available. This will help to ensure the allowance is not used to fund party political communications and instead only funds the necessary distribution of official information. Finally, all this information would be easy to find: it would be published on a central website for the Fees Office, on the website of the Commissioner for Standards, and linked to from the Commons directory for every MP.
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4.5 MEANGINFUL PENALTIES FOR BREAKING THE RULES
MPs should have to suffer significant consequences if they: ‐ Fail to publish an expense claim or relevant document ‐ Fail an audit of their expenses ‐ Fail to declare an interest ‐ Repeatedly try to get away with dodgy claims These consequences should be extremely serious if an MP is found to have done any of the above knowingly, with a low threshold for being debarred from Parliament for wilful corruption. In part, the consequences for these actions will be greater merely by ensuring that all details of MPs’ money‐related activities are published. But publication alone is not enough to ensure compliance. It would be pleasant to think that MPs could be trusted to police themselves under the public eye, but experience suggests otherwise. Instead, we here list some measures that would dis‐incentivise corrupt activities and, on ‐ page 43, we supply a suggested schedule of offences and appropriate sanctions that should result. A LEGALLY BINDING CONTRACT All MPs who wish to claim expenses should have to sign a legally binding contract accepting responsibility for publishing their claims and abiding by the letter and spirit of the rules. This would provide a legal basis for citizens to prosecute MPs for fraud when they wilfully break the rules. ‐ RECALL VOTES AND SUSPENSION FROM PARLIAMENT Suspension from Parliament has always been an attractive idea as a punishment. In the past, ‐ however, it has not been shown to be effective. ‐ Keith Vaz, for example, was suspended for a month in 2002 for failing to declare outside interests and then making false allegations and wasting police time during the investigation of his case. Yet he now sits on the Home Affairs Select Committee In order to make suspension from Parliament a serious penalty, citizens should be given power to trigger a recall by‐election during their MP’s suspension. If an MP is suspended, therefore:
‐
Her constituents should have the power to trigger a by‐election if they collect the signatures of 5% of the constituency electorate during the MP’s suspension.
LETTER OF CENSURE For more minor, but repeated, infractions of the rules, MPs should receive a public letter of censure to highlight their conduct to their constituents. The Letter should be viewable via the expenses database and available free in the MP’s constituency office and Commons library. RESIGNATION FROM POSTS OF AUTHORITY MPs who are suspended from Parliament or win a conduct‐related recall vote should be barred from taking on ministerial posts or chairmanships of any committees until they have not received a letter of censure for two years. TRAINING MPs who repeatedly submit inappropriate claims or unsubstantiated claims should have to undergo an intensive full day of training with Fees Office staff to ensure that they understand what they can claim and how to keep track of their claims. If their claims are usually handled by a particular member of their staff, that staff member should also attend. This training should also be available to MPs who have not been censured but wish to ensure they understand the rules. FINANCIAL PENALTIES All improperly claimed expenses should be repaid in full in addition to a fine. PUBLICITY In addition to adding all notes of censure and sanction to the public expenses database and Register of Interests, the Commissioner for Standards should, at every quarterly press conference, announce a list of those MPs who have been censured or subject to sanctions and state the reason. Those in attendance should be permitted to ask questions.
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Figure 17: Schedule of sanctions to dis‐incentivise corruption
OFFENCE
SANCTION
PUBLICATION
Repeatedly filing inappropriate claims or buying inappropriate items on the expenses debit card.
Claims to be refused or paid back and, if more than eight occur within a year, MP should undergo a mandatory day of training with the Fees Office and receive a public letter of censure. Claim refused or to be paid back.
Note made of claims repeatedly refused and training received. Letter of censure and evidence of money paid back published.
Filing a claim or buying items without filing supporting evidence. Repeatedly filing claims or buying items without supporting evidence. Filing a claim and/or supporting evidence for the claim over a month after the date on which cost was incurred. Failing to immediately pay back a claim deemed inappropriate or lacking supporting evidence. Deliberately falsifying information on a claim of value up to £100. Deliberately falsifying information on a claim of value over £100. Inadvertently failing to declare an outside interest of a value up to £500. Inadvertently failing to declare an outside interest of a value over £500.
Deliberately failing to declare an outside interest of a value up to £500. Deliberately failing to declare an outside interest of a value over £500.
Misleading the Commissioner during an investigation.
Note made of claim refused and evidence of money paid back published. Note made of claims repeatedly refused and training received. Letter of censure published.
Claims refused or to be paid back and, if over five within a year, MP should undergo a mandatory day of training with the Fees Office and receive a public letter of censure. Reimbursement reduced 50% and Note made of late claim and evidence of money paid back decreases by 5% for every week late published. thereafter, to zero. If already bought using debit card, MP to pay back penalty amount. Amount to be paid back will accrue interest at 20% per month. Once fine reaches 100%, MP’s expense account and debit card use will be suspended. Automatically triggered recall by‐election. Claim to be paid back plus fine of 300% the claim amount. Automatic ejection from the House and debarment from standing for 10 years. Claim to be paid back plus fine of 300% the claim amount. First two times, a public letter of censure. Third time and thereafter, suspension from the House under the terms below (as for value of over £500). Suspension from the House for a time the Committee on Standards in Public Life deems appropriate. During suspension, a recall by‐election may be triggered if 5% of constituents’ signatures are collected in its favour. Automatically triggered recall by‐election. Interest amount and a fine of 300% the interest amount to be paid to the Exchequer. Automatic ejection from the House and debarment from standing for 10 years. Interest amount and a fine of 300% the interest amount (up to a maximum of £100,000) to be paid to the Exchequer. Debarment or suspension from the House, as deemed appropriate by the Committee on Standards in Public Life. During suspension, a recall by‐election may be triggered if 5% of constituents’ signatures are collected in its favour.
MPs’ expense account highlighted on database as owing monies or suspended. Highlighted note made on claim and event listed in refused claims.
Highlighted note made on claim and event listed in refused claims.
Interest added to the Register of Interests with a note of censure.
Interest added to Register of Interests and highlighted.
Interest added to Register of Interests and highlighted. Proof of payment to Exchequer required (e.g., transfer receipt). Interest added to Register of Interests and highlighted. Proof of payment to Exchequer required (e.g., transfer receipt). Note made on MP’s name on both expenses database and Register of Interests.
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CONCLUDING REMARKS For too long, British politics have carried on in the world of cosy back‐room dealing and systematic paper‐shredding. It is high time for a change. In the musty chambers of Parliament, irrational arrangements and secretive ways are allowed to fester: the House of Commons is still a place in which newly elected Members have to beg clerks just to get access to a desk where they can work, where departments give you different answers depending on what day you ring them, and where politicians have to perch on the steps outside for stray wifi just so they can stay in contact with the outside world. In short, there is a wall between public and Parliament shored up by tradition, fear of scrutiny, technical incompetence and sheer bloody‐mindedness. In 2005, Grant Shapps MP complained, “The problem is that not only does this place make it harder than average to contact people outside, it actually blocks you from accessing your outside contacts using your own laptop, so it is working against you. […] We come back to the same thing every time, but it is a fundamental problem. It puts a blockage in the way of progress, almost deliberately.” He was referring to technical problems getting online in Parliament (or the “Estate,” as it is known to insiders). But he could just as well have been referring to the culture of secrecy and distrust of the public that is imbued in the entire institution of the House of Commons. In this report, we have tried to put forward proposals for better rules and a sensible rearrangement of the Commons' governing structure – one that makes it easy to organise and release information. These proposals are not just about efficiency. They are about changing what Parliament means to our society. For centuries, Parliament (roughly at least) played the part of defending British liberties against rapacious despotism by royalty. But now, the meaning of those liberties is changing. It is no longer enough that all citizens are permitted to cast their lot in with one party
or another every four years. It is no longer enough that politicians descend from on high occasionally to give lofty speeches to the press. Instead, we are entering an age where citizenship means taking responsibility for one's society in a way never before possible. It does not mean merely making an informed choice among a few options. It means looking up every idea and every factor that goes into these options and, if we so desire, constructing an entirely new option for ourselves. Parliament has not kept pace with this change. Instead, as Heather Brooke puts it, we suffer under “a class system of access to information. The privileged and powerful get access, the common citizenry does not. Information comes into the public domain with unseen strings attached.” Parliament and politicians can be dragged kicking and screaming out of this system and into the modern age, as they have been thus far. They can continue to engage in the shameful spectacle of redactions, excuses and hiding from the public. Or they can decide to adhere to the basic principle of a democracy: that people are to be trusted with their own fate. That means trusting people with information and letting the walls of Parliament become permeable. It means abandoning the illusion that there is something inherently different about a person on the visitors' balcony and a person on the Commons floor. The expenses crisis is a rare opportunity for Parliament to do this. Much of the public already instinctively understands most of what is said in this report in relation to Parliament. It is not an appeal to citizens. It is an appeal, however, to members – not just Members of Parliament, but to all members (clerks, programmers, managers, and so on) of the deeply rooted political culture of secrecy and self‐preservation at all costs. It is an appeal to those people to not merely stay “within the rules” but to persistently question the rules – to always insist upon viewing the rules from the frustrating “outside” as well as the cosy "inside.”
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APPENDIX Official “organogram” of House of Commons administration. Available at: http://www.parliament.uk/documents/upload/HCCorganogram.pdf
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© Juliet Samuel, Sunlight Centre for Open Politics, September 2009
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