Peers face suspension after expenses probe

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Indy Politics

Three peers were facing lengthy suspensions from parliament today after sleaze inquiries found they had wrongly claimed tens of thousands of pounds in expenses.

In damning judgments, the House of Lords Privileges and Conduct Committee said Baroness Uddin, Lord Bhatia and Lord Paul should repay nearly £200,000 between them.

Labour peer Lady Uddin and crossbencher Lord Bhatia were said to have acted "not in good faith" by incorrectly declaring their main homes in order to claim generous overnight allowances.

The committee recommended she be suspended from the upper chamber until the end of the parliamentary session in Easter 2012 - and longer if she refuses to return £125,349.10.

Lord Bhatia faces being suspended for eight months, and has already repaid £27,446.

An initial investigation decided that Lord Paul, another Labour peer, had also "not acted in good faith" in his home designations.

However, the committee rejected this finding on appeal, accepting that although "utterly unreasonable", he had not been "dishonest", and had already returned £41,982 last year.

It recommended he be suspended for four months.

The House of Lords will debate whether to accept the committee's findings on Thursday.

The sanctions are significantly heavier than those meted out last year to Labour members Lord Truscott and Lord Taylor of Blackburn.

They became the first peers suspended from the upper house since the 17th century after a separate scandal about political lobbying.

Until earlier this year, an allowance of £174 a day was available to peers whose main home was outside the M25.

Lady Uddin, whose case was examined by the police but faced no criminal charges, claimed more than £100,000 between 2005 and 2010 by stating that her main home was a small flat in Maidstone, Kent.

She told the sleaze inquiry the property was her "bolt hole", but it concluded she was "unreasonable" to describe the flat as her primary residence when her family home was in east London.

She was also found to have claimed travel expenses to and from the Maidstone flat "with the intention of adding verisimilitude to her designation of her main residences".

Although the initial probe by the sub-committee on Lords' conduct suggested that her suspension could last beyond April 2012 if she did not pay up, the full committee rejected that because it would mean the sanction was "indefinite".

"We dismiss Lady Uddin's appeal against the sub-committee's finding that she wrongly claimed £125,349.10 in night subsistence and mileage allowance; instead we endorse that finding," the report said.

"We further find that Lady Uddin did not make her claims for night subsistence away from the properties and for mileage allowance in good faith."

The leader of the upper house, Lord Strathclyde, said: "I was shocked and appalled by these cases.

"There was a clear and serious abuse of taxpayers' money. The penalties recommended would be the toughest handed out by the House of Lords.

"All this resulted from a flawed system of expenses relying on so-called second homes. When I became leader I moved to scrap a system that allowed such abuses. It has now been changed, and never again will there be scandals over bogus main residences."

The committee said Lady Uddin had not admitted any wrongdoing, merely offering a "sincere and abject apology if I have in any way, without any intention, by following what I thought was the right thing to do, broken the House rules".

Lord Bhatia had claimed that his "main home" was a small flat occupied by his brother in Reigate, Surrey.

However, the sub-committee pointed out that he and his wife remained on the electoral roll at their long-term £1.5 million home in Hampton, south west London.

"We consider that Lord Bhatia's connection with the Reigate property was insufficient for it to meet any natural meaning of 'main residence' for the purpose of the members' reimbursement scheme, especially in the light of his continued ownership and use of the Hampton property," the probe found.

It also rejected the peer's claims that the couple were planning to "downsize" into the Surrey flat.

"We find that Lord Bhatia's designation of the Reigate property was a deliberate misrepresentation of his domestic arrangements made with the intention of enabling Lord Bhatia to make use of the night subsistence element of the members' reimbursement scheme," the report added.

The investigation also concluded that the peer had claimed travel costs to the flat in order to back up his pretence that it was his main home.

The sub-committee originally recommended that Lord Bhatia be suspended for a year, and potentially longer if he did not repay the amount owed. However, this was downgraded to eight months by the full committee.

The report notes that the peer still maintains that he acted "properly" in declaring his residences, but handed back the full £27,446 owed earlier this month "on the advice of my legal advisers".