Thursday 22 January 2009

MPs Expenditure - new rules

Leader of the House, Harriet Harman’s, opening statement to debate on proposals governing MPs’ expenditure

Mr Speaker, I beg to move the motions standing in my name on the order paper.

But first I’d like to set out the basis on which we approach this issue.

I want this debate to proceed not in a Dutch auction of which party can do most to besmirch the reputation of MPs. I’m not going to do that because that would be wrong. We are public servants committed to our public duties and that is how we should approach this debate.

There should be proper resources to enable MPs to carry out our work. And we need to be sure that those allowances are not abused and used by MPs to line their own pockets. When that happens – as it did so disgracefully in the case of one particular member last year – it is not only the public purse that suffers. What suffers is the reputation of this whole House and of every one of us members who work hard and abide by the rules. So it is to take further steps to prevent the possibility of that abuse that I bring these motions to the House today. So that the public, and all of us in this House, can rest assured that public money is being properly spent.

I’d like to thank the MEC and the Commission officers and staff for their contribution to the work which lies behind the motions we come to today. I would not have been able to bring this to the House without their advice, expertise and many hours of meetings and work going back to last December when I first outlined to the MEC the approach that I am taking today.

Mr Speaker, when I was first an MP, in the 1980s there were three major problems which have been addressed bit by bit over the years.

Firstly, there were wholly inadequate resources for our offices. That has been addressed over the years and rightly so. Last year, my office handled 6,300 individual constituent cases. Each letter, email, phone call or surgery visit was dealt with within 10 working days on average. My constituents have a right to expect that we have the resources to do the job for which we are elected.

The second problem was that the rules for paying MPs claims were loose and unclear – giving scope for uncertainty and abuse.

And the third problem was that there was no information at all to the public about who claimed how much and for what. None at all. The rules were published but not the outcome.

Over the years, we have increased the resources to enable us to do the work our constituents expect, and we have begun publishing annually, information about members’ allowance – broken down into 14 categories.

But we need to do more.

There has been concern in three respects which we seek to address by the work we did in July last year and which we seek to take forward again today.

We need to address the problem that the rules were still not clear enough and therefore gave rise to opportunities for abuse
We need to address the problem that audit was not robust enough and
We need to address the problem that not enough information was published.

Our propositions before the House today address each of those problems.

So I approach this issue from a belief that the public is entitled to be confident.

That the public money that is being paid out is being paid out against a clear and reasonable set of rules.

That they can be confident that those rules are properly enforced and that money is not paid out other than within those rules.

That they should be able to know in respect of every member, every year, how much in allowances has been paid and for what..

So, in respect of the first point - clear rules - we bring before the House for approval the new Green Book. I’d like to take the opportunity of thanking the members of the Members Estimate Committee, the members of the Advisory Panel on Members’ Allowances, including the two independent members, and the many hon. members who’ve contributed to the new green book. And I’d like to thank the controller and auditor general for specifying the level of evidence which is needed in order to for us to be able to be confident that the rules are clear and can be the foundation for a robust audit. We will have, if we pass the resolution endorsing the new Green Book, a clear set of reasonable rules for paying allowances

Secondly, the proper enforcement of those rules. This requires robust audit and that is the subject of a resolution which will provide for what is described as “full scope” audit, on the same basis that applies to other public bodies. This will be the first time the House has been subject to full-scope audit.

The House authorities will check each claim before it is paid out. This work will be subject to the scrutiny of a new internal unit, the Operational Assurance Unit. But in addition to that there will be supervision by the National Audit Office and the NAO scrutiny will consist not just of examining the claim form that the member has signed but also at the evidence submitted with that claim, like invoices, receipts, statements or any other documentary evidence of the transaction.

The NAO will be in a position to do this full scope audit because as well as clear rules in the new Green Book there is a requirement that no claim over £25 will be paid out unless the claim is submitted with receipt or other evidence confirming the transaction.

I’d like to thank the Members Estimate Audit Committee, including the four individual members, and in particular its Chair, the Hon Member for Maidenhead, former shadow leader of the House. This is not glamorous work but it is very important. And it is her committee’s report which makes the proposals for robust and independent audit for which the resolution seeks the support of the House.

The third principle is that over and above the clear rules and robust audit, the public should know who is spending, how much and on what. The effect of the Resolution will be to affect a publication scheme that will put into the public domain more information than has hitherto been published. In a form which is consistent year on year and comprehensible to the public. Up till now, we have published information about expenses broken down into 14 categories. This resolution would mean publishing in greater detail - in 26 categories.

For example currently the House authorities publish a single figure for ‘office running costs’,” Under the proposed publication scheme the House authorities will publish the information broken down into
accommodation for offices and surgeries,
Office equipment and supplies,
Professional fees and charges,
Agency and other staff costs
Travel costs

So the single figure would be broken down into 7 detailed categories, for every member for every year.

At present, under the heading “costs of staying away from main home”. The House Authorities publish one single figure. Under our resolution that single figure would be replaced by
Mortgage interest
Hotel costs
Council tax
Fixtures fittings and furnishings
And other household costs including service charges, utilities, phones, maintenance and repairs.

The fourth motion would turn the Advisory Panel on Members’ Allowances, which has existed since July 2001, into a formal committee of the House. We are grateful to APMA for the work it has done and think it is time it should be formally constituted. This would put the Committee on the same footing as a Select Committee in that it will be able to call for evidence and publish its own reports. Nothing in the motion – or in any other motion today – prejudices the role of the Parliamentary Commissioner for Standards or the work of the Committee for Standards and Privileges.

As the Prime Minister and then I told the House yesterday, we have attempted to reach agreement on all these issues.

We brought forward a statutory instrument which would mean that these resolutions replaced the provisions of the FOI that apply to the House.

The official opposition said on Tuesday that they do not support the FOI statutory instrument so we have not brought it forward and I will seek further discussions with the Opposition.

But it remains important that we pass these resolutions today. They provide for
Clearer rules
Tougher audit
More transparency

And I hope that at least on these resolutions, this is something on which we can all agree. I commend the motions to the House.