House of Commons Speaker John Bercow demands four expenses watchdog board members re-apply for their jobs

The independence of the watchdog which sets MPs pay and expenses has been called into question after it emerged that the House of Commons Speaker had demanded that four of its board members re-apply for their jobs.

Correspondence released by the Independent Parliamentary Standards Authority (IPSA) revealed that John Bercow insisted that four board members could not be automatically re-appointed to their positions when they came up for renewal in January.

Instead he said he had taken legal advice which stated they would have to re-apply for their roles in an open competition and that former MP should have a key say in deciding whether they should keep their jobs.

As a result the four board members whose contracts were up for renewal decided not to reapply while the chair of IPSA warned that Mr Bercow’s intervention could undermine public trust in the organisation.

The new arrangements, Sir Ian Kennedy said, introduced “a level of parliamentary influence which I believe could cause some to question IPSA’s future independence”.

Ipsa took charge of MPs' expenses in 2010 in the wake of the scandal that engulfed Westminster.

However, tough new rules sparked fury among many politicians, who complained that they were having to subsidise their work and that claims were taking up too much time.

Although some elements of the system have been eased tensions remain.

The regulator is currently carrying out a review of MPs' pay, amid calls for salaries to be raised, and has already signalled that MPs pensions will be cut.

In a series of letters, which were sent over the summer and published today, Sir Ian made plain that he disagreed with the Speaker’s insistence that he was legally obliged to hold a full selection process, estimated to cost as much as £100,000 to carry out.

He also said forcing the four board members to reapply for their jobs would create the “perception” that they had failed in their duties.

Sir Scott Baker, Jackie Ballard, Ken Olisa and Isobel Sharp have now decided to leave Ipsa, meaning it will haemorrhage experience.

Sir Ian added that the inclusion on the selection panel of the former Tory MP Peter Atkinson would “inevitably introduce a perception of party politics”.

“This would be wholly undesirable given the need for Ipsa to be and be seen to be independent of political influence,” he wrote.

An Ipsa spokesman confirmed that four board members would be leaving, adding: “Of course, these are individual choices but one contributing factor was their concern about the process used to appoint and reappoint members to the Board.”

It is understood that the process of identifying new board members is well advanced and their names will be put to parliament soon.

The Speaker's Office played down the row, insisting it was merely a disagreement over “legal interpretation” of the Parliamentary Standards Act.

But a spokesman confirmed it had declined a request from Sir Ian to seek legal advice on the meaning of the Act.

The Commons spokesman said: “The existing four 'ordinary' board members were appointed for a three year fixed term which will expire on January 10, 2013.

“The Parliamentary Standards Act 2009 states that candidates put to the House for appointment to Ipsa must have been selected on merit and on the basis of fair and open competition.

“The Speaker took legal advice which confirmed that this provision required him to initiate a fair and open competition at the end of every fixed term.

“The Speaker accordingly set up an independent panel, including Professor Sir Ian Kennedy, to run such a competition.

“Under the statute, the current board members may be re-appointed once only for a term of up to three years, subject to the requirement that they re-apply and are again selected on merit, on the basis of fair and open competition.

“The current four ordinary members chose not to re-apply.”