MPs could get pay jump to £101,000 a year

The pay of MPs could soon exceed £100,000 if their second homes allowance is replaced with a block grant. The Commons has drawn up three options for overhauling the expenses system through which MPs claimed large sums for new kitchens, furniture and even gardeners.

They can claim up to £23,000 a year under the Additional Costs Allowance (ACA) for a second residence, with receipts. A review has suggested MPs could be paid an annual £40,000 (£24,000 after tax) instead of the ACA, without receipts. It would bring a backbencher from £61,280 to more than £101,000. The typical MP £4,500 would be better off, because the average claim under the ACA is £19,500.

This is understood to be favoured by the Members' Estimates Committee, chaired by the Commons Speaker, Michael Martin. It is also considering a £24,000 ceiling on the housing costs allowance, but pegged to the number of days an MP spends on parliamentary business.

The third alternative is to retain the present system, but with much stronger guidelines on what can be claimed under the ACA. The options are likely to be put to a vote of MPs next month.