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Select Committee on Members Estimate Committee Third Report


Conclusions and recommendations


Parliament faces many challenges and Members recognise they have a duty to uphold and strengthen the democratic foundation of our society. Public expectation of Members has grown and the weight and complexity of the parliamentary workload has increased significantly.

The Members Estimate Committee believes change is vital if we are to make Westminster a fit institution for the 21st century. In carrying out this root and branch review the Committee has been driven by two key objectives: the need to equip and support Members to carry out their responsibilities in a professional and effective manner and desire to meet public expectations for clearer audit and transparency. We were also determined to propose a system that will endure.

Our investigation of the current system of allowances has been thorough. We have explored best practice in the public, private and voluntary sectors and we have consulted widely with Members as well as organisations and individuals who have both experience and interest in providing effective solutions for the issues we have identified.

Our over-riding conclusion is that we must introduce a robust system of scrutiny for parliamentary allowances as a matter of urgency in order to build public confidence. We have also proposed a range of significant reforms for individual allowances—particularly those relating to accommodation and staffing.

In almost all cases we have made specific recommendations but we recognise that there is a spread of views on the way that reimbursing Members for living costs should be dealt with and we have set out alternative options for reforming the Additional Costs Allowance for the House to debate and arrive at a final judgement.

The conclusions and recommendations of this review do not make life easy for individual Members but we believe they will play a key role in strengthening and upholding the democratic institution in which we are proud to work as well as building the trust and confidence of the people we are elected to represent.

Audit and assurance

1.  We recommend that there should be a robust new system of practice assurance involving regular financial health checks on records kept and processes used in Members' offices with outside professional teams covering about 25% of Members each year and every Member each Parliament. (Paragraph 63)

2.  We recommend that the House extends the scope of the audit engagement so that it is the same as for other public bodies. The NAO expects that their sampling of claims paid will include one or more transactions relating to at least 20 per cent of MPs each year. (Paragraph 68)

3.  We recommend that, from the start of the 2009-10 financial year, the receipt threshold should be reduced from £25 to zero and that all claims, however small, will have to be backed by receipts. (Paragraph 47)

4.  We recommend that the Green Book (setting out the rules on allowances for Members) be revised to specify more detailed rules and that the new version be brought into effect by 1 April 2009. (Paragraph 71)

5.  We recommend that, for payments from the staffing allowance, it should be mandatory for Members to deposit staff contracts and job descriptions with the Department of Resources and that this should be rigorously enforced. (Paragraph 103)

Scope of overnight expenses

6.  We recommend that, with immediate effect, Members should no longer be able to claim reimbursement for furniture and household goods or for capital improvements. (Paragraph 215)

7.  We recommend that new MPs elected to the next Parliament to represent constituencies in outer London should be eligible to claim half of any overnight expenses allowance; and all MPs representing those seats should be restricted to claim half the standard rate from the start of the following Parliament. (Paragraph 229)

Constituency offices

8.  We recommend acceptance of the SSRB proposal that constituency office lease or rental should be met in full by the House recognising that in some constituencies office costs are higher than can reasonably be met out of the current Incidental Expenses Provision; that this should be limited in size and standard under detailed criteria to be drawn up by an independent chartered surveyor; that the scheme be run under the guidance of such a surveyor employed by the House; that the scheme be phased-in over a period of time; and that Members who choose not to make use of the new scheme can continue to claim for constituency office costs under the Incidental Expenses Provision or its successor. (Paragraph 130)

Communications

9.  We recommend that the rules governing the Communications Allowance be tightened in respect of not publishing during election periods, not using party logos or other distinguishing labels, confining distribution to Members' own constituencies and other matters; and that claims for the costs of production of any publication costing more than £1,000 will only be met if it has been cleared in advance with the Department of Resources. (Paragraph 141)

10.  We recommend that the Communications Allowance itself be frozen at the current level for three years from April 2009 till April 2012 and thereafter the uprating formula be changed to RPIX. (Paragraph 142)

Travel

11.  We recommend that the House should continue to apply the same car mileage rate as specified by HM Revenue & Customs. (Paragraph 160)

12.  We recommend that the current figure of 350 miles per month which may be claimed without supporting documents be replaced by separate mileage limits for small, medium-sized and large constituencies. (Paragraph 164)

Overnight expenses

13.  We recommend that the Additional Costs Allowance be adapted into an overnight expenses allowance, comprising a £19,600 maximum budget for accommodation (excluding furniture, household goods and capital improvements) but operating on the basis of itemised reimbursement and a flat rate of £30 for daily subsistence. (Paragraph 225)

14.  We recommend that, instead of the London Supplement (which Sir John Baker recommended should be increased to £3,623), the extra living costs and working unsociable hours in London should be reflected in a new London costs allowance consolidated into a taxable amount of £7,500 for MPs who do not or are not eligible to claim the Additional Costs Allowance. (Paragraph 234)

Resettlement

15.  We recommend that, in the next Parliament, the basis of calculation of the Resettlement Grant should be shifted towards Members leaving the House in their early fifties. (Paragraph 253)

Other SSRB recommendations

16.  We recommend that the SSRB proposal that Incidental Expenses Provision should be abated for every work station in London should not be implemented. (Paragraph 109)

17.  We recommend that no further steps should be taken to implement the SSRB proposal for a further increase in the Staffing Allowance for each full-time equivalent member of staff based in London. (Paragraph 110)

18.  We recommend that the SSRB's proposal that partners of Members should be entitled to the same limited travel arrangements as spouses and civil partners should not be implemented. (Paragraph 171)


 
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Prepared 25 June 2008