First Report
1. The Members Estimate Committee has made progress
in the review of Members' allowances.[1]
In our report published on 26 February the Committee announced
that the threshold of £250 for invoices and receipts should
be reduced from the start of the next financial year.[2]
In this second report the Committee states what the new threshold
will be from 1 April 2008.
2. Three options have been considered for a new threshold:
£100, £50 and £25. We have also taken into account
the implications for the current petty cash arrangements. In
reaching these decisions the Committee has taken into account
views expressed by Members, correspondence from members of the
public and the advice of the Department of Resources.
3. We have heard from Members from all sides of the
House that they already submit receipts with their claims. Members
have also spoken of their experience in previous jobs outside
the House which suggest that in other occupations all receipts
would be submitted with claims or certainly for all claims over
£25. We will be looking at practice in other organisations
as part of our overall review.
4. We have considered whether the threshold should
be zero but ruled it out for practical reasons. Members working
both in the constituency and at the House and travelling between
the two do incur small costs which are normally paid in cash and
for which receipts are not given.
5. The amount of petty cash which can be drawn each
month, mainly for minor office costs, is currently £250.
This shall be reduced to £50 a month from 1 April 2008.
Members will keep a petty cash book recording what items petty
cash is spent on, which may be subject to audit. Claims for office
items costing more than £25 would need to be accompanied
by a receipt.
6. The question of food while working away from home
will be considered in the context of the root and branch review
of allowances and is not covered by this report.
7. The new low threshold for claims needs to be under-pinned
by a more robust regime for audit. The Committee is determined
to establish audit controls which command public confidence.
Building on the recommendations of the SSRB and the Members Estimate
Audit Committee, we are looking at options for a better system
of assurance. Members have told us that they expect there to
be a more rigorous system for checking the money has been spent
on the purpose intended. Some have suggested that there should
be a system of random spot checks on a percentage of Members'
claims. Meetings will be held with the National Audit Office,
private firms of accountants, HM Revenue & Customs and the
Audit Commission to establish what is the most practical and effective
arrangement. In the issues paper we have undertaken to publish
by the end of March, we will set out some possibilities to achieve
a more rigorous audit regime.
8. The Committee has considered the implications
for the Department of Resources of a lower threshold. Since many
Members already do submit receipts for items below the threshold,
the increase in work will not be as great as might be expected.
Reducing the threshold may lead to Members submitting claims
on a more regular basis. We understand there may need to be some
modest increase in House staff but that a receipts threshold of
£25, £50 or £100 per item is administratively feasible,
and can be implemented in April 2008.
9. The Members Estimate Committee has therefore
instructed the Department of Resources that, with effect from
1 April 2008, no claim against allowances of £25 or more
per item will be reimbursed unless it is accompanied by a receipt.
10. The Committee will publish at the end of March
a further report setting out all the issues being considered in
this root and branch review and seeking comments on them. Our
emerging conclusions will be produced in May before a final report
in time for a decision by the House in July.
1 The House referred 11 recommendations from the Senior
Salaries Review Body on 24 January 2008. On 4 February, the Members
Estimate Committee announced a root and branch review of allowances
following the Fourth Report of the Standards and Privileges Committee
on the conduct of Derek Conway MP, HC280. Back
2
First Special Report HC 368. Back
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