Cameron and Clegg reject plan for MPs' expenses

Gordon Brown's attempt to restore public trust by reforming the system of parliamentary allowances ran into trouble last night after David Cameron and Nick Clegg flatly rejected Downing Street's proposal to introduce a daily allowance for MPs.

Speaking after a tense meeting in the Commons yesterday, Mr Cameron said the Prime Minister's proposal of issuing MPs with a daily allowance would effectively lead to a system in which people were effectively paid "to turn up and do their job". "What he's effectively doing is replacing a system where you have to produce some receipts with a system where you get the money without having to produce any receipts," he said. "I simply don't think the British public will accept that and so I think we'll have to oppose it."

The Tories published their own proposals for reform of the housing allowance, including reducing the total amount that could be claimed.

Renamed the Transparent Parliamentary Allowance, all claims would have to be backed up by receipts, which would be published online.

Mr Brown's surprise announcement came on Tuesday in response to the growing criticism of MPs' expenses. His main proposal was to abolish the additional costs allowance, worth £24,006 a year, which is used by MPs to subsidise the costs of a second home. This would be replaced by a daily allowance which would only be paid when parliament is sitting.

But speaking after the meeting yesterday, Mr Clegg said the leaders could not agree on the Prime Minister's plan. "My problem is that Gordon Brown won't budge. He wants to move to this system where basically MPs will be given a cheque simply for turning up at work."

The Prime Minister will now put pressure on backbench Labour MPs to support his plans in a parliamentary vote next Thursday.