I was out of pocket, claims Lord Hanningfield

(PA)

A Tory peer accused of fiddling his House of Lords expenses said he was "out of pocket" for taking on the peerage and had tried to balance out his expenditure using his expenses claims, a court heard.

Lord Hanningfield, 70, who is being tried under his name Paul White, said that he "averaged out" his claims to recoup some of the money he had spent as a result of his parliamentary duties, Chelmsford Crown Court was told.

When the former leader of Essex County Council was questioned by police, he told detectives to look at the records of other peers and claimed he was not the only one claiming expenses in such a manner.

He said he felt as though he had been "singled out" and that his claims were "no different" from any other peer.

White, who faces six counts of false accounting, told police: "I have done the same as 500 or 600 other peers.

"I averaged them out because of my total expenditure.

"I have spent all of my money, £200,000, being a peer, and I have claimed £150,000 back. I have claimed what I thought I could within the law. I have never done anything illegal in my life."

He said he was forced to borrow money to "sustain" his public service.

"I have just put so much money into my public life," he added.

"I regret ever becoming a peer, I wish I had just stuck at the County Council."

White is accused of making false claims for accommodation and travel costs incurred before or after performing his duties in the House of Lords between March 2006 and April 2009.

White said he believed he was entitled to make the claims because the system was an "allowance" scheme, not an expenses system, jurors were told.

"It is an allowance scheme, not a reimbursement scheme," he told police during an interview.

"Quite honestly, people see it as a way of recouping what we spend.

"Over the years, I have spent £50,000 to £60,000 more than I have ever claimed in the House of Lords."

During the second day of his trial, jurors were read a statement which he provided to police during an interview at Colindale police station in north London in August 2009.

During the interview, an officer asked White if he could read the statement aloud but he admitted that he could not for fear he would "pass out".

"I am nearly 70 and I work very hard and I am horrified about this," he told detectives from the economic and specialist crime directorate at New Scotland Yard.

"I am worried that if I read it, I will pass out."

In the statement, White said: "I am surprised and upset by allegations in the media by Bob Russell that I have made false representation in relation to claims I have made - I have never knowingly made a representation which is untrue in terms of allowances and never have I made gain for myself.

"I do not believe that I have made any false claims within the allowance scheme.

"I have always been told that total allowances claimed should not exceed that of actual expenses incurred. I do not believe I have broken this rule.

"I am actually out of pocket as a result of my parliamentary duties as we do not receive any salary."

He said that he did not believe overnight subsistence meant you had to stay in London .

The statement continued: "Overnight allowance does not necessarily mean that the member had to sleep in London.

"I believe that it is widely understood that this includes subsistence during or after sittings regardless of where the member actually sleeps."

But he admitted that he had never gone over the rules about expenses in detail.

He said: "I have to confess that I have never been directed to a rule book and I have never had the time to refer to it either. I suspect that applies to the vast majority of peers."

When the police probed him on his statement, he explained that he was a very busy man and that he worked extremely hard for both the House and the County Council.

He said he had a "horrendous" workload and that he had total power over the council which employs 40,000 people and has a £2.2 billion annual turnover.

"Essex is as big as Northern Ireland," he said.

"So my job is something like the equivalent of being prime minister of Northern Ireland. It is bigger than Croatia, Lithuania and Latvia.

"We have the same size economy as Cuba - it is a very busy job."

Yesterday Clare Montgomery QC, prosecuting, said that in March 2006, White made claims for travel every Friday of the month, when in fact, the Lords only sits on a Friday on the odd occasion.

Today the court heard a statement from White's former driver Paul Byatt who said that White "rarely" spent Fridays at the House of Lords.

Mr Byatt, who was employed by Essex County Council between 2006 and 2009 as a chauffeur to White, said the peer usually reserved Fridays for work at Essex County Council and spent approximately three or four days each week in the Lords.

"Very exceptionally he spent five days per week in Westminster," said Mr Byatt.

He said that since June 2006 he had dropped White to the House of Lords and left him to make his own way back on 20 to 25 occasions.

He added: "I have never taken him to a central London hotel to stay the night."