A plague on both your houses
The publication of detailed expenses claims of MPs has left politicians from all parties in the firing line. How did the culture of letting the taxpayer pick up the tab become so universal?
"No one ever sets out to become an expenses fiddler,” confessed an MP in his late thirties. “It just sort of creeps up on you.”
The path to the moral low ground, he said, begins almost as soon as a new MP steps inside parliament. “When you are elected you are invited to a series of briefings by the Commons fees office,” he explained, speaking anonymously last week for fear of being ostra-cised by his fellow MPs.
“They are all about the different expenses: travel, office costs and, of course, the second home allowance. It is all very matter-of-fact, but what it does is plant in you the idea that there is all this money out there.
“For example, I had no idea you could claim back the cost of food. It seemed odd at first claiming for your weekly Tesco’s bill, but then you get used to it. Then the danger starts when you come to rely on it.”
Ministers and MPs have not just come to rely on it - they are milking it for all they can. Details revealed last week show they are claiming, at taxpayers’ expense, everything from tens of thousands of pounds for mortgages, rent, new kitchens and home furnishings to a few pounds for porn movies, pet food and a 5p carrier bag bought by a Scottish Labour MP.
Corrupt? Fraudulent? MPs say it is all within the rules - which they happened to make. Either way, the systematic abuse is a deeply corrosive canker at the heart of British democracy.
Another MP, a Tory and a former army officer, admitted the expenses culture had insidiously chipped away at his sense of right and wrong.
“When I was in the army I had got into the habit of scrupulously noting down the exact distances of the journeys I had taken while on duty,” he said. “I did the same when I first became an MP - until the fees office complained to me that I was burdening them with too much detail. After a while I just began guessing the mileage.”
The culture of greed is deliberately passed on to new MPs to keep the gravy train rolling along. A northern Labour MP explained: “Everyone gets it when they are a new boy in the House - the pat on the back and someone saying, ‘I hear you haven’t bought your place in London yet; you’ll be letting the side down’.
“You are then reminded of how you can charge stamp duty and legal fees on expenses and how your second home can become your second pension. When everyone is doing it, it takes courage to put on a hair shirt.”
All this largesse comes to MPs tax-free. While voters have faced stealth tax increases for years, MPs have received tens of thousands of pounds on top of their salaries without paying any extra tax - because they voted in 2003 to exempt their overnight expenses from the Revenue.
Disquiet over the system has been building ever since this newspaper brought a freedom of information case in 2005 to gain access to details of their claims. MPs fought long and hard to keep them secret.
The truth, however, will out. Last week someone with access to full details of their claims since 2004, including receipts, sold the information to The Daily Telegraph, reportedly for a six-figure sum.
The full scale of parliamentary avarice and absurdity hit the headlines on Friday. The expenses claims reveal that Gordon Brown paid his brother £6,577 in 26 months for “cleaning services” at his flat. Downing Street says the brothers shared a cleaner and Brown was reimbursing his brother for his portion of the costs.
The prime minister, who enjoys a grace and favour flat in Downing Street, also designates his family home in Scot-land as his “second home”, which means he has been able to get the taxpayer to foot the bill for a gardener and cleaner there and for various repairs and decorations.
Jack Straw, the justice secretary, claimed on his expenses more in council tax than he had actually paid on his “second home” in his Blackburn constituency. He apparently discovered the mistake when it became clear that MPs’ expenses were likely to be made public - and hurriedly repaid the money.
John Prescott, the former deputy prime minister, claimed for the addition of mock Tudor beams to his home in Hull. He also got the public to pay for repairs to two of his lavatories. Andy Burnham, the culture secretary, was not satisfied with claiming £16,500 to buy a flat in London: he even tried to claim for a £19.99 bath-robe from Ikea.
Last week some MPs tried to blame the media for the furore, claiming it was a disgrace that private information had been sold and disclosed. The public are not fooled. Sir Fred Goodwin blew much more but the morality in question is little different. As the public learn just how deeply snouts are in the trough - from lowly backbenchers all the way up to cabinet members - they are outraged.
“They [MPs] are no different to the benefit cheats they regularly attack in word and print,” was one of hundreds of hostile comments made on the blog of Nick Robinson, the BBC political editor.
“Six grand for a cleaner while [Brown] has been taking the country to the cleaners? . . . Time to clean out your desk, little man,” wrote an infuriated voter on the website of a newspaper usually sympathetic to the prime minister.
A reader of Timesonline from Gloucester summed up the mood: “The whole political system has reached rock bottom. Nobody trusts MPs any more. . . We need a revolution in politics led by people with common sense who have the nation’s interests at heart, not their own.”
The political class has been shamed by the revelations. Yet beyond conceding that the rules need reform, its members have barely shown remorse, let alone apologised. Where will the scandal lead and how must the system change?
THE seed that led to the revelations was sown in January 2005 when The Sunday Times and Heather Brooke, the campaigner, decided to test new legislation promising “open government”. We asked for details of the expenses claims of a sample group of 14 MPs including Tony Blair and Brown.
The Commons authorities rejected the request and the matter was passed to the information tribunal. It determined that receipts should indeed be published, warning that the “laxity” of the parliamentary expenses regime was “very different” from schemes in the private sector.
MPs are allowed to claim a range of expenses, from staff costs to travel and stationery. As representatives from all over the country, who work both in Westminster and in their constituencies, they can justifiably argue that they need two bases: one in London and one in their constituency.
To help them with this expense they are given an “additional costs allowance”, now worth up to £24,000 a year. Parliament’s own explanatory notes make it clear what this is for: “The additional costs allowance is paid to reimburse members for necessary costs incurred when staying overnight away from their main home for the purpose of performing parliamentary duties.”
Are table lamps in the shape of elephants - bought by a Tory MP for £134.30 each - necessary for parliamentary duties? What about two leather armchairs, costing £2,600, bought by Keith Vaz, Labour chairman of the Commons home affairs select committee? Knowing their shameless exploitation of the system, MPs strove to keep the details secret and took the matter to the High Court. They wanted to preserve the system whereby the total amount of their expenses was made public, but none of the specifics. They lost and last May the court agreed with the information tribunal that the public should know what MPs were claiming.
At that point it became inevitable that the expenses of every MP would have to be published with the information backdated to 2005.
The Commons Fees Office, which employs about a dozen officials, was ill-prepared for the tsunami of paperwork. All receipts would have to be checked, rechecked and digitally scanned. Information relating to bank accounts and private addresses needed to be “redacted” - blacked out - and passed to the relevant MP for verification.
The Commons brought in TSO, a private consultancy, to help manage the job.
During this process - probably about two months ago - a computer disk containing the full details of every MPs’ expenses was copied or went missing. The source of the security breach is still not clear. The Commons authorities are privately blaming TSO, suspecting a disgruntled employee or temporary staff member. TSO says it has carried out an inquiry which found no evidence that it was to blame.
What is known, however, is that a go-between for the whistleblower tried to sell the disk to several national newspapers, reportedly for £10,000 per cabinet minister. In March the Sunday Express used this source to reveal that Jacqui Smith, the home secretary, made an expenses claim that included the cost of her husband viewing two pornographic films at their family home.
Most newspapers were wary of buying more information, partly because unconnected legal actions had imposed tougher rules on privacy - even though the media had warned that it might restrict the publication of matters in the public interest. The disk held vital information that, despite the court victory, was still not going to be published by the Commons. MPs were being allowed to delete certain information before the documents were released. “They are deleting things like telephone numbers, credit card numbers and home addresses,” said Nick Harvey, a Liberal Democrat on the House of Commons commission handling the matter.
“We had also been advised on security grounds that we should not publish information which betrayed an MP’s regular movements or travel patterns.”
A key issue was information on addresses. Although nobody would argue that MPs’ security should be compromised, without details of where MPs were claiming tens of thousand of pounds in expenses it would be impossible to check whether the payments were merited or not.
As the claims now show, the practice of “flipping” the places they designate as their “second homes” has earned many MPs huge sums for reasons that are at best dubious.
TAKE Geoff Hoon, the transport secretary and former defence secretary and leader of the Commons. He appears to have created a £1.7m property empire by exploiting the expenses system. Between 2004 and 2006 he had the use of a grace and favour flat in London and designated his family home in Derbyshire as his second home.
He claimed more than £35,000 in expenses for it, even though he had owned it since 1986 and had only a modest mortgage outstanding on it.
After he changed jobs in a cabinet reshuffle, Hoon lost his grace and favour flat in London. So he then designated his house in Derbyshire as his main home and bought a Georgian townhouse in London as his “second home”. He claimed more than £45,000 on it in two years.
Hazel Blears, the communities secretary, has been even more nimble in flipping the designations of her abode. She managed to claim expenses on three different properties in one year.
In March 2004, having said her second home was in her Sal-ford constituency, she bought an £850 television and video recorder and a mattress costing £651 and billed the taxpayer. A month later she decided her second home was in Kennington, south London, where she began claiming £850 a month for the mortgage on it.
Soon after that she sold the flat at a £45,000 profit and bought a more expensive one. She claimed for the mortgage on that and spent £4,874 on furniture, £899 on a bed and £913 on a television.
These facilities were clearly not enough for her to perform her parliamentary duties. So in 2006 she spent £668 on bed linen and curtains, £439 on crockery and kitchen equipment and more than £200 on bath towels. When questioned, Blears said: “All of my claims are entirely in accordance with the rules.” She then hurried into a car.
Inquiries by The Sunday Times have established that John Hutton, the defence secretary, is also a “flipper”. He used to say that the room he rented in a London flat was his second home. Then in September 2005 he bought a £730,000 five-storey house in west London, complete with a loft conversion, kitchen extension and 50ft garden. Although he moved into it with his wife, Heather Rogers, he proceeded to designate it as his second home. His main home, he said, was a small rented cottage in his constituency in Cumbria. By designating his house in London as his second home, Hutton has been able to claim £66,707 against the property over three years, almost the maximum possible.
Then he changed again. When he became defence secretary last October, Hutton switched his main home back to London, claiming expenses against his constituency home.
He said: “I have always tried to ensure that the designation of my main home has properly reflected my own living arrangements and complied fully with the rules.”
The perambulations of Margaret Moran, the Labour MP for Luton South, are rather harder to comprehend. She has designated her “second home” as a succession of properties in Westminster, Luton and Southampton, claiming expenses against all of them. She installed a new kitchen in a property in Westminster and had the garden at her Luton home redone.
Her most debatable decision was to claim a property that she and her husband owned in Southampton was her second home – even though her constituency is in Luton and her work as an MP is in London. After designating the property, she claimed £22,500 in allowances for it, including treating dry rot.
Yesterday Moran told the BBC: “Everything has been fully within the rules. There are gross inaccuracies in the Telegraph.” NOT all MPs are on the fiddle. Some may even have been unfairly tarnished by the revelations. Yesterday the Telegraph alleged that Phil Woolas, the immigration minister, claimed reimbursement of bills that included nappies, tampons and a woman’s blouse.
Woolas has certainly not been backward in claiming expenses: in most years he has claimed near the maximum for the second homes allowance, including £400 a month for food. But yesterday he denied he had been paid expenses for nappies or women’s clothing.
“The allegations against me include a number of items that weren’t claimed for; that were on a food receipt from the super-market. The expenses I claimed and received were for the food subsistence allowance which is legitimate. The other items on the receipt were not part of the claim,” he said.
Overall, however, the response of Britain’s ruling classes has been little better than an ostrich. Almost no politicians at the centre of the latest allegations have apologised; most have tried to justify their extravagant manipulation of the expenses system as “consistent with parliamentary rules”.
The response of the clerk of the House of Commons was even more out of touch. He wrote to MPs saying that a “criminal offence” may have been committed in the way the information had emerged and set up a helpline to advise MPs if they found themselves in a tangle.
Last night it was suggested that some might even find themselves in legal trouble. Vincent Coughlin, a QC specialising in fraud, warned that criminal charges should not be ruled out where MPs have been found to be “flipping” their homes.
“At the heart of each fraud is the concept of making a gain for oneself or another, with the critical element of dishonesty, usually determined by a jury,” he said. “It must decide whether according to the ordinary standards of reasonable and honest people what was done was dishonest, and if it was, whether the defendent must have realised that what he was doing was dishonest.”
Taking a wider perspective, Tristram Hunt, the political historian, said MPs have become so divorced from ordinary voters that they do not understand the depth of anger. “This is bad, very bad. It’s comparable in impact to the selling of hon-ours [in the 1920s],” he said.
“It’s beyond party politics. You want a cashiering of the entire political class. It’s the kind of thing, in a younger democracy, that would have brought about a new republic.”
Last week official figures showed that after-tax incomes for average households barely grew at all in the five years leading up to the recession.
Not surprisingly, hard-pressed voters are asking why they should give Barbara Fol-lett, an MP married to a multi-millionaire author, £25,000 for security because she is worried about being mugged.
Why should a wealthy Tory frontbench MP (as yet unnamed) be given £598.59, tax-free, to pay for the servicing of his ride-on lawnmower?
Alistair Graham, former commissioner for parliamentary standards, said: “The sheer scale of what has been taking place overwhelms you. Manipulating the system to get capital gains in the housing market is a constant theme. Nobody’s got clean hands. It’s getting pretty near the fraudulent, but the experience is it never meets criminal standards of proof.
“What one has to ensure is that MPs never have the opportunity to determine their own arrangements in the future.”
Mark Wallace, campaign director of the TaxPayers’ Alliance, said it would submit a dossier of complaint to John Lyon, the parliamentary commissioner for standards, calling for inquiries into specific MPs and an investigation into the role of the parliamentary fees office.
Fearing that more and more damning details will emerge over the coming days, Alastair Campbell, Blair’s former spin doctor, yesterday suggested that it would be better for the Commons to speed up its plans to publish the expenses rather than let the media dictate events.
The practicalities are not so simple. “The information is still far from ready,” said Harvey. “In IT terms all this [data] needs formatting and building into a website in a form robust enough to withstand the level of interest. That is a piece of work we have scheduled for June. These things can be brought forward, but I don’t think it can be done at the flick of a switch.”
It means that the revelations will go on. David Cameron and his Tory party members will have their foibles exposed. A number of Westminster observers say they expect some of the most outrageous excess-es are lying hidden among the claims of backbenchers.
Despite the public outcry, many MPs are getting ready to block proposals to cut their expenses down to size. Harvey warned that the plans being drawn up by Christopher Kelly, chairman of the independent committee on standards in public life, could be rejected. “If we were made significantly worse off and in a messy sort of way, I don’t know if you could assume MPs would feel cowed by the public mood,” he said.
David Maclean, the Tory member of the Commons commission, was even more defiant: “MPs will reject it if Kelly doesn’t get it right. MPs have nothing to lose.”
However, Cameron and Nick Clegg, leader of the Liberal Democrats, are doing their best to ride the “antipolitics” wave that is sweeping the country and may see advantage in pushing through change. Cameron seems much more attuned to the public mood than Brown, who has so far bungled attempts to reform the expenses system.
“I completely understand how angry the public are about this and we desperately need change,” said Cameron, warning that he would show zero tolerance to any Tory caught fiddling their expenses.
Clegg said: “People will just simply despair that all politicians look either ridiculous at best or corrupt at worst.”
So far Brown has failed to provide a convincing lead on reform. Three weeks ago he announced plans to replace the second homes allowance with a “per diem” payment where MPs would be paid £150 a day for attending the Commons.
Most MPs thought such a “clocking-on” plan would merely open them up to further ridicule. The issue was rejected.
Until there is reform of a system that allows MPs to claim tax-free everything from 23p for a lemon (a Labour backbencher) to £105 for having his septic tank emptied (a Tory frontbencher) to tens of thousands of pounds for home costs, the stink will remain.
And who is going to take notice of any such politician who tries to claim the moral high ground?
Shaming of our political class
ANDY BURNHAM
The culture secretary, below lived in a swanky London apartment at taxpayers’ expense - until he was paid £18,230 to give up the flat when the building was sold. He could have given the windfall to the public purse, but instead struck a deal with the Commons authorities to keep most of it. He also told Commons officials to hurry up paying his expenses or he might be ‘in line for divorce’ from his wife Marie-France.
TONY McNULTY
The work and pensions minister, in charge of clamping down on benefit cheats, may face a police investigation himself over alleged misuse of public funds. The Met is considering a complaint following disclosures that McNulty claimed £60,000 towards maintaining a second home where his parents lived, 11 miles from Westminster
SHAUN WOODWARD
He’s the richest man in the cabinet, and owns seven homes. But that didn’t stop Woodward milking parliamentary allowances - claiming £100,000 for the mortgage and council tax on his £1.35m apartment by the Thames. His staff don’t live as grandly: one of his assistants claimed 38p for a Muller Crunch Corner yogurt and £1.06 for a pizza
JACK STRAW
The justice secretary must be ruing the day he helped push through the Freedom of Information Act that led to all this misery. Receipts reveal that Straw claimed on expenses twice the amount of council tax he actually paid. Later, once it became clear his claims would become public, he repaid the money and lamented ‘accountancy is not my strong suit’
HAZEL BLEARS
The cabinet career of the communities secretary was already hanging by a thread after she criticised Brown last weekend. The disclosure that she claimed expenses for three properties in a single year makes her a surefire casualty in this summer’s reshuffle. Blears also chose to stay at London’s Zetter hotel, voted one of the 50 coolest, hotels in the world courtesy of public purse
DAVID MILIBAND
The foreign secretary went all the way to America to adopt a baby - but wasn’t keen on coughing up for a pram to ferry the child around. He put in a claim for £199 for a pram, along with £80 for ‘baby essentials’. MPs’ allowances don’t cover costs for children, and his claim was thrown out. But he did get £30,000 over five years for refurbishing his constituency house in South Shields
JOHN PRESCOTT
The former deputy prime minister used to be mocked as ‘Two Jags’. Now he may become known as ‘Two Lavs’ - after he twice claimed on expenses for repairs to lavatories at his home in Hull. He also got taxpayers to foot a bill of £6,772.27 for work on the house, which included the addition of mock Tudor beams to the outside.
Keith Vaz
The Labour chairman of the Commons home affairs committee claimed more than £75,000 in expenses for a London flat despite having a £1.15m house just 12 miles from Westminster. Vaz later changed his designated second home to be a house in his Leicester East constituency and then made claims for furniture and £480 of cushions - most of them silk
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