Complaint lodged with watchdog over Smith's expenses

A complaint has been made to the parliamentary sleaze watchdog about Home Secretary Jacqui Smith claiming allowances for a second home while living as a lodger with her sister, it was confirmed today.

But the office of Standards Commissioner John Lyon stressed that no decision had been taken over whether to launch an inquiry into Ms Smith's expenses claims.

Ms Smith has insisted that she "fully abided" by the rules in designating her sister's house in London as her main residence, allowing her to claim payments on her Redditch constituency home which she shares with her husband and children.

But in a letter to Mr Lyon, Harry Cole of the Centre for Open Politics said that there appeared to be "prima facie a case to answer in respect of Jacqui Smith's arrangements" and urged him to open an inquiry.

Mr Lyon's office said: "We have received a complaint. This is not the same as taking a decision to inquire into it."

Conservative leader David Cameron told a news conference in Westminster the arrangement - which enabled Ms Smith to claim £116,000 over a period of years - did not look very good.

"There are rules which you have to obey. Of course you should do that openly and you should be transparent about these things," he said.

"But also any arrangements you enter into - can you explain them in a reasonable way to a reasonable person and would they think it is reasonable?

"I have even said occasionally you subject yourself to the 'Daily Mail test' - how does this look on the front page of the Daily Mail? To which I think the answer is 'Not very good'.

"I think that is a matter for her. I think she may have some questions to answer when you look at the Green Book and all the rules that govern this."

His intervention came as Downing Street sought to draw a line under the issue.

Gordon Brown's spokesman said: "Jacqui Smith has made her statement on that and that's it as far as the Prime Minister is concerned."

The tax-free Additional Costs Allowance - worth up to £24,006 a year at present - is claimed by MPs for the costs, such as mortgage interest and fuel bills, of working in both Westminster and a constituency.

Under the rules, the main residence is where the MP "spends more nights than any other" although recent guidance said "value for money" for the taxpayer could be used as a factor if there was doubt which home that was.

A spokeswoman for Ms Smith said at the weekend that she had "long-standing written approval" from the Parliamentary Fees Office for her arrangements.

"She spends the majority of her time in London attending to Government business and has full approval for any associated expenses relating to her second home in her West Midlands constituency," the spokesman said.

Asked whether the Prime Minister continued to have full confidence in Ms Smith, Gordon Brown's spokesman told a daily briefing of Westminster reporters: "Of course."