More evidence of MPs 'claim culture' disclosed

Sunday 23 October 2011 01:51

Yet more damning evidence of the 'claiming culture' in Westminster was disclosed today, with a further assortment of politicians embarrassed over their expenses activity.

Five Sinn Fein MPs were facing questions over nearly £500,000 in taxpayers' money they received for running second homes in London - despite not even taking up their seats in the Commons.

One current minister, Kitty Ussher, set out a two page wish-list of improvements to her house in the capital and merely instructed parliament officials: "Please pay as much as you are able."

Another, Kevin Brennan, apparently had a £450 television delivered to his family home in Wales, even though it had been claimed on expenses for use at his London home.

Meanwhile, it emerged that Communities Secretary Hazel Blears had avoided £18,000 in capital gains duty on a taxpayer-funded flat. She seemingly told HM Revenue & Customs it was her primary residence, while simultaneously declaring it as a second home to the Commons.

The latest salvo of sleaze was unleashed by the Sunday Telegraph amid signs that the reputation of parliament - and of Gordon Brown personally - were sustaining serious damage.

More than two thirds of the public believe the scandals have directly hurt the Prime Minister, according to a poll by ICM for the News of the World.

Some 89% of those quizzed warned that people's opinion of MPs had been tarnished, and 91% called for uncensored expenses records to be published in full immediately.

More than seven in 10 people did not think MPs should ever be able to claim for a second home - the aspect of their expenses that has caused the most controversy.

Former Archbishop of Canterbury Lord Carey warned that a "culture of abuse" had developed in relation to Westminster expenses, and MPs only had themselves to blame.

"The moral authority of Parliament is at its lowest ebb in living memory," he wrote in the NotW.

"The latest revelations show it was not just a few MPs with their noses in the trough, but a culture of abuse."

The five Sinn Fein MPs are said to have rented three London properties from the same family at rates well above the market norm.

The party's two most senior figures, president Gerry Adams and Northern Ireland deputy first minister Martin McGuinness, jointly claimed expenses of £3,600 a month to rent a shared two-bedroom flat in the capital.

But a local estate agent reportedly estimated that a fair monthly rent would be £1,400.

The three other MPs together claimed £5,400 a month to rent a shared town house, which the estate agent suggested was worth around around £1,800 a month on the open market.

At other times between 2004 and 2008 some of the MPs apparently stayed in a third property, another two-bedroom flat.

The five MPs have claimed more than £310,000 in five years from the public purse by submitting receipts from one man, an Irish landlord living in London, and his family, according to the newspaper.

A Sinn Fein spokesman denied its MPs had done anything wrong, and stressed they did not purchase properties and benefit from price rises. "It is widely known that Sinn Fein MPs travel regularly to London on Parliamentary business and utilise the accommodation that we rent when there," he said.

"The rent we pay on these properties are all inclusive of parking, utilities, housekeeping etc and therefore you are not comparing like with like."

A host of more current and former ministers were also named by the newspaper as having engaged in questionable expenses activity.

They include former Prime Minister Tony Blair, ex-Trade Secretary Stephen Byers, Cabinet Office minister Tom Watson and former Tory minister John Gummer.

Mr Blair, who was the subject of an FOI disclosure last year, apparently remortgaged his constituency home for £296,000 - nearly 10 times what he paid for it - just before buying a west London house for £3.65 million.

While there is no suggestion Mr Blair broke any parliamentary rules, he was able to use the system to claim for interest repayments amounting to almost a third of the new mortgage on his constituency home.

The remortgaged amount was enough to cover the deposit on the new London house, the newspaper reported.

A spokesman for Mr Blair said: "There is nothing new in this story. This is just a recycling of known information from a previous Freedom of Information inquiry. The facts are as we said at the time: there was no cost to the taxpayer in this decision."

Ms Ussher asked permission to carry out a full refit of her run-down Victorian house in south London.

She is said to have contacted the Commons fees office within 12 months of becoming an MP in 2005, despite having already lived at the house for some five years.

Ms Ussher, who was not a minister at the time, wrote: "The basic situation is that this house was relatively cheap to purchase but requires quite a lot of work."

She then listed repairs which she hoped to carry out, including a bathroom which did not "function" and "peeling" walls in the shower room.

On the cover sheet of her printed letter, Ms Ussher scrawled: "I am aware this takes us over our limit - please pay as much as you are able!"

In the end, Ms Ussher received the maximum permitted under the Additional Costs Allowance (ACA) for 2005-6 - £22,110.

Alongside the new revelations, the Telegraph seemed to change tone slightly on some of its previous allegations. There had been anger in Downing Street after Gordon Brown was criticised for channelling money to his brother in order to fund a cleaner who worked for both of them.

Several other subjects of stories have threatened legal action for supposed inaccuracies. They include immigration minister Phil Woolas, who was accused of claiming for his wife's clothes and nappies, and Labour backbencher Margaret Moran - who allegedly switched the designation of her second home to a seaside property 100 miles from her constituency, and days later claimed £22,500 to treat dry rot.

While insisting that its reporting was in the public interest, a leader article in today's newspaper states: "There are those MPs who, despite their good intentions, have none the less fallen victim to an overly complex expenses system that has served to portray their actions in an unflattering light.

"For example, the receipts submitted by Gordon Brown for the cost of a cleaner, shared with his brother Andrew, fall into such a category. There has never been any suggestion of any impropriety on the part of the Prime Minister or his brother."

Desperate parliamentary officials have asked Scotland Yard to investigate how the expenses details were leaked - although police sources indicated the force was unlikely to decide whether to launch a probe until after the weekend.

There have been widespread calls for the House authorities to disclose all the material now rather than allow the "drip drip" disclosure by the Telegraph to continue.

However, Lib Dem MP Nick Harvey, a member of the ruling House of Commons Commission, played down that prospect.

Members are currently meant to be checking their records are accurate, and ensuring that details such as addresses are deleted for "security" reasons.

The version of the receipts obtained by the newspaper still includes this information - meaning it is possible to see how MPs are "flipping" which property they declare as their main and secondary residence in order to maximise expenses.

Mr Harvey said the Commission would consider the timing of its publication - which had been pencilled in for July after the House lost a long-running FOI battle - at a meeting tomorrow.

But he told the BBC: "As far as we are concerned, before we put this information out we have got to complete the process."

Cabinet minister Ed Miliband said the expenses scandals had been a "wake-up call" to politicians.

The Energy and Climate Change Secretary told BBC1's Andrew Marr Show: "What we are seeing this weekend ... is a challenge and a wake-up call to politicians about the systems that we have in place."

He added: "Of course it needs to be reformed. I take my responsibility as an MP that we didn't reform it earlier.

"The Prime Minister a few weeks ago was saying 'this is a problem, it does need reform', people didn't like his idea for reform, but the system needs to change.

"That's the wake-up call that we, the politicians, have received."

Mr Miliband said Ms Blears had "always wanted" to designate her London residence as a second home and added: "I think Hazel has clearly said that she has acted within the rules. What we know is that the rules need to change."

He said the biggest problem with the rules was a "lack of clarity" about what could be claimed and that "what is perhaps being allowed doesn't accord with the public's view of what should be allowed".

Shadow defence secretary Liam Fox said it was now obvious that the public viewed the rules governing expenses as "wrong".

With the Tory leadership braced for revelations about their MPs' claims, Dr Fox told the Andrew Marr Show: "It's very clear now how the public are looking at the system.

"The trouble is that politicians have tended to say 'we were only acting within the rules' but the public think the rules themselves are wrong and go way beyond the legitimate needs of people who have to be in London to represent their constituents in Parliament."

Dr Fox said "flipping" was wrong in principle. "The idea was always that ministers were deemed to have their primary residence in London when they were members of the government."

There had to be a "hard and fast rule" about what constitutes an MP's primary home.

But he warned that the scandal over MPs' perks could mean that only rich people, who would not need to rely on allowances, could afford to go into politics "which would be setting our system back 200 years".

Culture Secretary Andy Burnham - who has faced criticism over his claims for redecoration and furnishings - said there had been too much opportunity for MPs to use their "discretion".

He also called for the public to be given a say in how the regime was reformed.

"We are talking about claims that were made, in my view, under a flawed system," Mr Burnham told Sky News' Sunday Live programme.

"Our big collective failing - and I completely acknowledge my part in this - is not throwing it out much more quickly than this.

"The great tragedy of it is that because of this flawed system it has given the impression that lots of people in the Commons are personally flawed.

"I do not believe that to be the case."

He went on: "People could make their own judgments and there were lots of opportunities to use discretion, and that is why it looks so different in every individual case."

Mr Burnham said MPs could not "wallow" in the scandal, and suggested that a "citizens' jury" should be brought in to help shape a new system.

"What we need is a much tighter system that the public has endorsed in some way," he added.

"It cannot look like there has been a solution stitched up in Westminster."

Labour's Sir Stuart Bell, who sits on the ruling House of Commons Commission, said a new audit system was set to be introduced tomorrow.

"In all probability tomorrow the Commission will approve a special specific audit unit, hived off from the fees office, independent of the fees office which will verify in future every claim that's made by any Member of Parliament," he told Sky News.

Kate Hoey, a former Labour minister, said taxpayers would want to know "how on earth" MPs were able to put certain claims on expenses.

Referring to Tourism Minister Barbara Follett's reported £25,000 expenditure on security, she said: "I just cannot understand that one at all. I would need to have someone really convince me that an MP can claim that amount of money for personal security, when I know that in my constituency I have women who walk home late at night who would love to have somebody paying for them to have personal security.

"The public will not understand why she has been able to do that and therefore her own constituents will have to judge her on that."

Speaking on the Stephen Nolan Show on BBC Radio 5 Live, she stressed she had strongly opposed letting Sinn Fein MPs claim allowances without taking up their seats in the House. However, they were now "doing no more than Parliament decided they could do".

Sir Stuart told Sky News the new unit would comprise professional accountants and will aim "to be sure that every claim is proper" and "to reassure the public that we do take fully into account their concerns".

"I should think tomorrow when the House sits that there will be some contrition on behalf of all MPs that we have lost the public confidence and we will seek, from tomorrow, to gain that back," he added.

New rules already passed by MPs would "preclude a lot of the claims" made under the old regime.

He said the publication of the MPs' expenses may have breached the Data Protection Act, although he appeared to rule out action being taken against the Daily Telegraph.

Sir Stuart said: "We have seen with these publications a breach of the Data Protection Act because the information that the House was going to release in July was ... edited, it took out the names of houses, addresses, it took out bank details, credit card details.

"So there was a clear breach of the Data Protection Act and that is what the House Authorities were trying to prevent, to keep the data protection of MPs as everyone else's data should be protected."

He continued: "No one has ever suggested action against the Telegraph, what has been suggested is a proper investigation into who it was that put into the public domain information that was in breach of the Data Protection Act, which may have been stolen, which may be in breach of the Official Secrets Act."

Lib Dem frontbencher Lynne Featherstone said she was "ashamed of my bretheren", and insisted MPs were getting their "due punishment" for abusing the system.

She said arguing that rules had not been breached was not good enough.

"I do not include myself in this actually, but we have acted disgracefully and we are getting out due punishment for what has clearly gone on under the surface for years and is not being exposed," Ms Featherstone told Sky News.

"You can or should be able, whatever your circumstances, be able to judge right from wrong, and within the rules is not in my view a huge defence against some of the allegations that are going on in the press, some of the revelations.

"There can never be an opportunity for MPs to make money out of the public money that they use to buy their home."

The Hornsey and Wood Green MP said when she entered Parliament other members encouraged her to claim significant expenses.

"I was pulled aside and told not to rock the boat," she added.

Sir Stuart told the Press Association that the new unit would cost around £600,000 a year to run.

"It will be staffed by skilled people from outside parliament and once the unit is established (plans) are already under way that it should be given over to the private sector," Sir Stuart said.

The unit will assume some of the duties of the fees office, but Sir Stuart insisted there was no question of any employees being laid off from there. Some could be transferred into the new unit, he added.

The bill for processing MPs' expenses in 2008-9 had previously been forecast at £1.2 million - not including accommodation or IT costs.

However, the costs had already been boosted by reforms passed by the Commons last month, that from July will require MPs to file receipts with all claims, no matter how small, and declare all time worked on outside jobs.

The Commons Commission will also consider at its meeting tomorrow whether expenses details should be published on a quarterly basis, rather than annually as at present.

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