| Present:
Rt Hon Andrew Mackay (AM)
John Lyon, Parliamentary Commissioner for Standards (JL)
Note-taker
Introduction
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| JL | Thank you for coming in. This is the note-taker. She will take a note of our discussion and show it to you afterwards so that you can be satisfied as to its accuracy. It will not be a verbatim note, but it will be reasonably full.
The note will be included in the memorandum I propose to submit to the Committee on the complaint, and you can expect it to be published with the Committee's Report.
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| I wrote to you on 2 June to set out the procedures and to give you the main areas I wanted us to cover.
Are you content for me to go ahead?
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| AM | Absolutely.
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| Factual background
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| JL | May I first summarise the facts? You bought your property in Bromsgrove in September 1997 and your current London property about a year later.
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| AM | That is correct. But it might have been 1999 rather than 1998.
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| JL | I will ask you about that in a minute.
You bought both properties jointly with your wife, Ms Kirkbride, and you have a joint mortgage on each property.
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| AM | Yes.
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| JL | Around September 1997 you designated your Bromsgrove property as your main home and began to claim against the ACA for your London home.
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| AM | Yes.
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| JL | At the same time, your wife designated your London property as her main home, and began to claim against the ACA for your Bromsgrove home.
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| AM | Yes.
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| JL | In the five years from 2004-05 to 2008-09, you claimed at or near the maximum of your ACA allowance for your London home.
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| AM | Roughly yes. You have the figures.
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| JL | Since April 2009, you ceased claiming ACA on your London property and claimed instead the London Costs Allowance.
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| AM | Yes, for the reasons I have previously outlined.
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| JL | Is that a reasonable summary of the key facts?
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| AM | Absolutely. There is no dispute there.
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| Ownership arrangements
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| JL | You raised the question of the dates when you took on your London property. Information from the Land Registry suggests that you bought it in September 1999. Is that correct?
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| AM | I would agree with that. I have had to compile the information for you without records. But I can remember that we bought the property well after we married but before the millennium.
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| JL | So did you have another London home earlier?
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| AM | Yes. I claimed ACA on that and then things just transferred to the other property.
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| JL | And can you confirm that the additional mortgage for the extension in Bromsgrove was a joint mortgage?
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| AM | Yes. It was not a new mortgage but an extension to the mortgage. It was not taken out to meet the full cost of the extension to the flat, but a proportion of it. My wife has explained to you how she approached a senior official in the Fees Office about the extension.
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| Use of the properties
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| JL | May I ask you about the use of the two properties? Your evidence is that your pattern of overnight stays in Bromsgrove was "broadly the same" as your wife's, except for some Sunday nights during the year and some other nights during the September recess.
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| AM | That is correct. Normally in September when there was a recess and our son was back at school my wife would be in London with him. I would perhaps be there too or perhaps attending to the family duties relating to my two elderly relatives.
Normally we had joint holidays. Each of us might have gone on parliamentary delegations, but these would approximately cancel each other out.
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| JL | In effect, you estimate that you spent, and I quote, "slightly more" nights in Bromsgrove than in your London property. For 2009, you estimate 16 more nights a year in Bromsgrove than in London.
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| AM | Yes, approximately.
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| JL | Can you confirm that this balance of nights between London and Bromsgrove was a consistent pattern from 2004-05 to 2008-09?
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| AM | Yes, there wasn't a different pattern, although it wasn't exactly the same in each year.
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| JL | How did you get to these figures?
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| AM | I tried to work through my current diary. I don't have past diaries. But I could say roughly when I was on holiday in past years.
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| JL | Do you accept that the difference in the number of overnights you spent in each property was marginal? Put it another way, if your estimate was wrong by only nine nights a year—that's just over one night's difference in every six weeks—you would have been spending more nights in London? Do you accept that?
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| AM | That is an approximation I have given you.
I am not sure that my definition of marginal is the same as yours. But I never set out to suggest that I stayed massively more in one place than in the other.
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| JL | Can I now ask you about your London home? Do you accept that it is larger and more substantial—and considerably more valuable—than your Bromsgrove property?
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| AM | A London property is always going to be more valuable. Our London home is a town house with three and a half bedrooms, three reception rooms and two bathrooms. Our constituency home is in a listed building in which we have the largest apartment. We have two reception rooms and three bedrooms, including the extra one, and two bathrooms. They are about the same square footage but the valuation will be higher for the London home because central London prices are higher than North Worcestershire prices.
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| JL | Your son goes to school in London. Is that right?
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| AM | Yes.
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| JL | Would I be right in assuming that London is where your wife spent more nights than in Bromsgrove, since she designated London as her main home?
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| AM | Yes. When our son is at school she is always with him. I am normally with him and I like to be with him but there are times when I cannot be, for example in the month of September.
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| JL | Given that your wife saw London as her main home, the nature of the property, the proportion of the nights you spent there, and your son's commitments at school there, can you help me on why you nevertheless thought it right to designate Bromsgrove as your main home, in effect away from your family's main base?
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| AM | It was based on the number of nights I spent there, which was the principal reason; and also on the advice given by the then Head of the Fees Office when I went to see him. Also, unlike my wife, I was born in Birmingham and brought up in the Midlands.
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| JL | I note that you received London Costs Allowance in April 2009. Did you continue to designate Bromsgrove as your main home for your travel claims?
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| AM | No. I have only ever claimed for travel between Parliament and my constituency. I have never claimed travel to and from my main home. I felt it would be an unreasonable burden on the taxpayer.
April 2009 was my first opportunity to change when the new rules came in. The London Costs Allowance increased to £7,500 (taxable). That was sufficient to cover my mortgage and other costs. There was a campaign in the local and regional press against Members within commuting distance of London receiving the second home allowance so I elected to swap over.
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| JL | I understand from media reports[190] that your Bromsgrove flat is on the rental market. Is that true, and do you plan to continue to live in Bromsgrove?
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| AM | Yes, it is on the market, although without any real interest in it. I don't know whether we will continue to live in Bromsgrove. We have now both accepted private sector jobs within a short distance of our London home, and we will have to decide whether to retain our home in Bromsgrove. No decision has been taken.
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| JL | How will you manage your responsibilities for your elderly relatives if you no longer have a base in Bromsgrove?
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| AM | Those responsibilities are now slightly different. I don't have the same need to be in Bromsgrove as I did eighteen months ago. The property portfolio is now in the hands of a firm of chartered surveyors and one of my elderly relatives is now in residential care most of the time. I drive up to see them and back, which is difficult but do-able.
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| Fees Office |
| JL | Let me ask you about your contacts with the Fees Office. Your evidence is that you discussed your arrangements with the then Head of the Fees Office in about September 1997. That person retired in 1998 and I have not thought it necessary to consult him separately about this matter. The Department have no record of a note on the file from him at the time. Did your wife come with you to the meeting?
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| AM | No, I went. She was a new MP just arrived in the House. I went to see the Head of the Fees Office. I explained that my circumstances had changed, I was now married to an MP and I had no idea what to do with my second home allowance. I described the properties as I have described them to you, although there was one less bedroom in Bromsgrove then.
The Head of the Fees Office said it was straightforward and he told us what to put in place. That is what happened ever since.
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| JL | Did you think it was straightforward?
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| AM | My wife and I were completely transparent. We did not feel we were doing anything wrong. We always filled in our forms correctly. That was why it was a very great shock when it was suddenly suggested that our arrangements were wrong.
I had no idea what arrangements I should have. I asked the Head of the Fees Office and the idea was entirely his. I have a very clear memory of the meeting. As far as I was concerned he put a note on the file.
The Director of Strategic Projects has confirmed to you that the Fees Office had not questioned our arrangements, which gave us comfort.
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| JL | Were you aware at the time that your wife would be claiming for the London property as her second home?
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| AM | Yes. I went to see the Head of the Fees Office on behalf of us both. It was his suggestion that she should nominate one property and I should nominate the other.
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| JL | Were you aware at the time or subsequently that, had you identified London as your main home, it would not have been possible for you to have claimed ACA for your Bromsgrove property?
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| AM | I never thought about it. I went and saw the person in charge at the very top. I had had a number of contacts with him over the years. I asked him what I should do and I did it.
As far as I was concerned I was doing everything transparently and correctly. If anything I had always erred on the cautious side. At one point I was on the Committee on Standards and Privileges. I was always meticulous about ensuring everything was in place correctly and done transparently.
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| JL | Did the Head of the Fees Office tell you that you couldn't claim for your Bromsgrove property if you nominated your London property as your main home?
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| AM | No. He asked questions such as did I have somewhere in my own constituency, about the size of the properties and then said "This is what you should do."
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| JL | Do you agree with Sir Paul Kennedy that if such was the advice you were given, it was "plainly mistaken"?[191]
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| AM | No. With respect it is easy to be wise after the event.
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| JL | Why do you not agree?
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| AM | I went to people to get advice, to the Head of the Fees Office. That advice was perfectly reasonable. We were both separate MPs and we were the only MP couple who did not have coterminous constituencies.
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| JL | But that doesn't mean that the advice couldn't be wrong.
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| AM | No, but I didn't think so then and I don't think so now.
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| JL | You are quoted in the Guardian on 14 May 2009 as saying, "Looking back now, it does look strange". Is that an accurate quotation?[192]
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| AM | I don't recall saying that.
But on the day when I resigned as adviser to David Cameron I was in the middle of a media scrum. If the Guardian say I said it, I accept that I did. There was a complete melee.
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| JL | Do you still think that it looks "strange"?
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| AM | It is not a bad word—better than the other descriptions.
But as I have said we were the only MP couple without coterminous constituencies.
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| JL | But the arrangements ended up with neither of you paying for your main homes. Why did you not think that strange at the time?
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| AM | I don't accept that.
I could have been married to a head of a company or a head teacher whose house was paid for separately, and I could still have claimed for my second home.[193]
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| JL | Do you accept that, whatever advice you may have been given, it was your personal responsibility to act within the rules of the House?
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| AM | Yes. As a Member of Parliament, every claim is your responsibility.
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| JL | Do you accept your responsibility for this, and do you think the advice you took was correct advice?
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| AM | MPs are busy people. That is why I took advice.
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| JL | Did any warning bells jangle when you decided on this arrangement?
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| AM | No bells jangled, and that is why what happened on 14 May was so horrendous.
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| The rules |
| JL | Can I now apply the Green Book rules to your situation? From June 2003 to March 2009, the Green Book said that a Member's main home will normally be a matter of fact. What do you say to the suggestion that as a matter of fact Bromsgrove was not your main home: London was your main home? It was your wife's main home, where your son went to school, it is by far the more valuable and substantial property, where you spent only slightly fewer nights than you estimate you did in Bromsgrove?
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| AM | I don't accept that the London home was a more substantial property. Its square footage was probably smaller, and you can't go on the valuation as many MPs will have London flats which are worth more than their properties elsewhere in the UK. Both are substantial homes and all three of us spent a lot of time in both.
I spent slightly more time in Bromsgrove because I had the additional responsibilities to my two relatives and the property portfolio which I oversaw.
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| JL | The rules also say that where a Member has more than one home, their main home is normally where they spend more nights than any other. Do you accept that this rule did allow for exceptions, and that it was open to you, under the rules as they were from 2003 to 2009, to designate your London property as your main home, despite spending slightly fewer nights there?
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| AM | It is up to others to interpret the rules. I didn't think about it one way or the other.
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| JL | But the Green Book says "normally". Do you accept that that left it open to you to do something different?
I thought that the Head of the Fees Office said that you had a choice?
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| AM | No, he made a recommendation. We abided by that.
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| JL | And when the rules were clarified in 2003?
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| AM | I checked. I worked out in my head the number of nights I spent there normally and asked did that add up. I thought that seemed fine. I would have paid no attention to the "get out clause".
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| JL | Even though the difference in your pattern of overnight stays was "slight," to use your word, did it go through your mind that you could identify your main home differently, but you would not then be able to claim for your Bromsgrove property?
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| AM | No. The idea that Members spend ages thinking about these arrangements is wrong.
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| JL | Why do you consider that you acted within both the letter and spirit of the rules?
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| AM | As I have explained, it was my main home, I took advice from the Fees Office and I felt it was all straightforward.
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| JL | Do you still feel it was straightforward?
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| AM | Our circumstances were unusual. We were the only married MP couple without coterminous seats. We were an "odd couple".
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| JL | Why did it follow that it was right to designate different main homes if you didn't have coterminous seats, but it would not have been right for Members with coterminous seats?
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| AM | If you had coterminous seats you would have one home straddling the two constituencies and one in London.
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| JL | But the principal reason for your designation was that you spent more nights in one place. Could that not have been the case for MPs with coterminous constituencies, allowing them too to claim on both homes?
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| AM | Maybe.
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| JL | You are reported in the Guardian of 14 May 2009 to have said, "I have clearly made an error of judgement for which I profusely apologise." If that is an accurate quote, what did you mean by it?
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| AM | I don't recall.
I did seven separate live interviews on that day. I had a mass of journalists around me and I was asked lots and lots of things.
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| JL | So, looking back, do you feel there was an error of judgement?
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| AM | Looking back, I don't. There was no moment when I sat down and thought that I had made an error. The letter from the Director of Strategic Projects is very powerful. We had every reason to have comfort.
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| JL | Looking back now, do you think you made an error of judgement?
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| AM | I had a busy parliamentary career. I was a pairing whip, chief whip, a senior political and parliamentary adviser; I had a large and vibrant constituency and two families to look after. Did I have time to sit down and consider this and was it reasonable to have done so? Was it something I should have thought about?
All my training was to seek advice on what to do from the person at the top. That is what I did.
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| JL | All of these things could be seen as extenuating circumstances. But do you accept that it doesn't mean that it was the right advice or the right decision?
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| AM | MPs including myself are very busy. They don't sit around and consider these decisions.
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| JL | Do you now consider that you made a wrong decision?
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| AM | I didn't manufacture a mortgage and claim for that; I didn't claim for a house a hundred miles away and pretend to be ill.
I kept my expenses in good order in every possible respect. Sir Thomas Legg found nothing wrong except this. I made sure I claimed the correct amounts for council tax and that I submitted receipts.
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| JL | Looking back do you believe you should have done anything differently?
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| AM | I believed I was acting correctly.
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| JL | Do you still believe that?
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| AM | I do.
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| JL | What would you say to the argument that the Green Book rules could not have intended a Member to be relieved of the cost of their main home?
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| AM | The Green Book is silent on that as on many other points. Would it have been wrong for me to have claimed for a second home if I had been married to someone whose home was supplied by a wealthy relative or someone she worked for?
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| JL | Do you draw a distinction between that case and the claims you made?
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| AM | No.
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| JL | But is not this money all coming from parliamentary resources? In effect, the taxpayer funded both homes?
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| AM | I don't agree.[194]
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| JL | Do you not accept that the taxpayer funded both your houses?
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| AM | In our case, the taxpayer has assisted with the funding, with the mortgage interest. The taxpayer has not funded them.
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| JL | Do you think that is acceptable?
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| AM | I do. That is my distinction. And there will be other people who are not paying for their homes themselves.
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| JL | The rules also say that Members' claims should be above reproach. Do you believe that your claims were above reproach?
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| AM | I do.
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| JL | The Code of Conduct requires that Members should maintain and strengthen the public's trust and confidence in the integrity of Parliament and never undertake any action which would bring the House of Commons or its Members generally into disrepute. Do you believe that your actions have had this effect?
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| AM | I believe that the Telegraph's expenses coverage has had that effect.
We have paid a very high price for what some people think is an error of judgement, both in career terms and in the substantial sum of money we repaid. In my wife's case the appeal to Sir Paul Kennedy was rightly granted, but we still repaid the best part of £60,000. I don't believe it was right. But I believe in the rule of law. I always said I would repay what I was asked to even if I didn't believe I had done anything wrong.
We have been under double, now triple jeopardy. If this goes to a report to the Committee, I would like you to include in the evidence our correspondence on this.
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| JL | I will certainly take account of that request.
The claims you made with your wife avoided either of you paying for a main home. They enabled you to have an additional bedroom added to what you considered to be your main home on the basis of your wife's ACA claims. Why do you consider that your actions here were above reproach?
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| AM | That is my wife's case but I am happy to answer. She took advice from the most senior adviser in the Fees Office. It was quite clear that it was allowed to extend the property to allow a child to have his own bedroom after a certain age. We increased the mortgage to do this but there were greater costs that we incurred.
Sir Paul did not uphold Sir Thomas Legg's views on this.
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| JL | Did you think, "This is my main home. Why am I building an extension with parliamentary resources?" Did it worry you that you were making substantial improvements to your main home?
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| AM | It was entirely within the rules, it was clear that it was allowed to build an extension for this purpose. We had no reason to think of that.
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| JL | Thank you. Is there anything further you would like to add?
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| AM | Only to ask you to include in the report the correspondence about our disagreement in respect of the triple jeopardy which followed your decision to accept this complaint.
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| Conclusion |
| JL | Thank you. I will certainly be considering the inclusion of that correspondence in my memorandum.
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| The note-taker will now prepare a note of our discussion and show it to you so you can confirm its accuracy.
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| I am minded to prepare a memorandum for the Committee. You should draw no inference from that. It will also deal with the complaint against your wife. The note of this discussion will be subsequently published with the report.
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| Once I have the note of the meeting, I shall prepare the factual sections of my memorandum, which again I would show you to check their accuracy.
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| I will then add my conclusions and submit the full memorandum to the Committee. The Clerk will show you it and invite any comments you want to make about it. Any such comments will be submitted to the Committee with my memorandum, and published.
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| Do you have any further questions?
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| AM | No. I am familiar with the basic procedure, although a little out of date.
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| JL | Thank you for coming in.
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| The interview concluded at 11am.
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| 9 June 2010
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