New expenses regime 'impeding' MPs

The new parliamentary expenses regime is "impeding" MPs in doing their jobs and must be reformed within the next two months, the Leader of the House of Commons said today.

In a highly critical statement, Sir George Young said the system set up by the Independent Parliamentary Standards Authority (Ipsa) was "failing in many respects" to support the Commons.

Certain "highly unsatisfactory" aspects of the reformed expenses are "at best distracting, and at worst impeding" the work of MPs.

The new system is deterring people from less affluent backgrounds from becoming MPs and putting "undue pressure" on the family lives of existing parliamentarians, he said.

In a submission to the annual review of the new scheme, Sir George called for improvements to be agreed, if not introduced, by April 1.

His intervention came as Ipsa was publishing the latest tranche of MPs' claims today.

Ipsa has incurred the wrath of hundreds of MPs since being set up to administer their expenses in the aftermath of the 2009 scandal.

Sir George said: "I believe that the current expenses scheme, as designed, implemented and administered by the Independent Parliamentary Standards Authority, is failing in many respects adequately to support MPs to undertake their responsibilities.

"There are some highly unsatisfactory features of the scheme that are at best distracting, and at worst impeding, MPs from doing their jobs.

"In addition, some aspects of the new regime are in danger of deterring people from less affluent backgrounds from becoming - and in some cases remaining - Members of Parliament and are also placing undue pressure on some MPs' family lives.

"This is unsustainable and it would be unacceptable to the House, if Parliament is to perform the task the country expects.

"I continue to support the principles of independent regulation and transparency.

"However, it would be unacceptable for any external body to prejudice the service that constituents should, as a matter of course, expect from their Member of Parliament."

Sir George said the Commons expected Ipsa to recognise the need for "substantial change", including a "simpler and, in the long run, more cost-effective system that properly supports all MPs as they go about their duties".

He added that it was "essential" for Ipsa to ensure "the key elements of the new scheme are established, if not actually operational, by 1 April 2011".

Sir George also appeared to take issue with Ipsa's publication of rejected expenses claims, which it is doing for the first time today.

"MPs must not be deterred from applying for expenses because they fear reputational damage as a result of failed claims made in good faith, nor from seeking advice for fear that the fact that they have done so may be disclosed and used against them," he said.

MPs had 154 claims for expenses rejected by Ipsa between September 15 and the end of October, it was disclosed today. They were collectively worth £15,352.49.

Another £3,641,081.09 was paid out in legitimate claims to 622 MPs in September and October.

The rejected claims ranged from one for just 30p for stationery to others worth hundreds of pounds.

Tory Defence Minister Peter Luff had a £286.50 telephone bill knocked back because he did not provide adequate documentation. He had another two claims, together worth £195, for administration costs rejected because Ipsa deemed them "not claimable".

Labour backbencher Paul Flynn had a £762 claim for service charges thrown out because of insufficient evidence.

Tory MP for Broadland Keith Simpson had a £1,230.23 claim for advertising disallowed. Ipsa said he provided insufficient evidence for the claim.

Deputy Labour leader Harriet Harman had a £75 claim for venue hire thrown out because of insufficient evidence.

Graeme Morrice, Labour MP for Livingston, had 24 separate claims for car travel within his constituency rejected by Ipsa. Each was for £1.60.

Downing Street said David Cameron believed that Ipsa was not working properly and the problems needed to be dealt with.

"You cannot have a system that costs £6 million a year to administer the expenses of 650 people," the Prime Minister's official spokesman said.

"Ipsa was set up quite rapidly following the expenses scandal. Clearly there are problems with the way it is working.

"The Prime Minister's view is that we have got to deal with this."

Deputy Prime Minister Nick Clegg submitted claims totalling £14,451.33 for the period from May to October.

They included mortgage interest costs of £842.47 a month and regular council tax bills of £180.

The rent on his constituency office in Sheffield Hallam cost the taxpayer £725 a month and he spent £2,369 on "parliamentary support".

The Prime Minister spent £2,581.13 during the same period, the majority of which went on research by the Parliamentary Resources Unit (PRU).

Chancellor George Osborne claimed £582.62 between May and July, all for travel and administration costs.

All of Mr Cameron's and Mr Osborne's claims were previously published in Ipsa's December release.

Former prime minister Gordon Brown claimed £8,264.33 up to September.

More than £5,000 of that was spent on running his Kirkcaldy and Cowdenbeath constituency office, although it also included more than £2,000 of previously published travel costs.

Ipsa hit back at Downing Street on the issue of running costs.

"Saying Ipsa costs £6 million a year to administer 650 MPs' expenses it not accurate," it said in a statement.

"Ipsa's costs in its first year were £6 million, but this includes a number of costs associated with setting up an organisation, eg, IT, temporary staff and recruiting staff.

"Ipsa administers thousands of expense claims a week. We also have responsibilities to pay all MPs and all members of their staff - up to 3,000 people.

"Furthermore, Parliament has charged Ipsa with the duty of being an independent regulator - this means setting and governing the system and providing training to hundreds of MPs and thousands of their staff, not simply administering expenses.

"We have already made a public commitment that we will cost less next year."

Tory MP Penny Mordaunt backed Sir George's criticisms, saying that the current system "discriminates against anyone who has come from any ordinary background".

She said that MPs needed £20,000 to £30,000 in the bank to cover their expenses while their claims were dealt with, and she warned that some would not be able to afford to see out the parliament.

"It means that MPs from, actually, not even modest backgrounds, but who have been earning even something like £50,000 before they came into the House of Commons will be very hard-pushed to continue under this regime," she told BBC Radio 4's The World At One.

"It is proving extremely difficult. Most of my colleagues are consistently £10,000 to £15,000 out of pocket. Over the Christmas period I had £22. That's it. That was the absolute limit.

"If you are spending out £5,000 every month, and our net salary is about £3,500 - if you are spending that amount of money and then not being reimbursed for office expenses and so on for months, then that soon adds up."