CORRECTED TRANSCRIPT OF ORAL EVIDENCE
To be published as HC 1484 – iii

HOUSE OF COMMONS

ORAL EVIDENCE

TAKEN BEFORE THE

COMMITTEE ON MEMBERS’ EXPENSES

THE OPERATION OF THE PARLIAMENTARY STANDARDS ACT 2009

Tuesday 18 October 2011

Dr Fiona Alexander

MartYn Taylor

Sir Christopher Kelly

Evidence heard in Public Questions 115–200

USE OF THE TRANSCRIPT

1. This is a corrected transcript of evidence taken in public and reported to the House. The transcript has been placed on the internet on the authority of the Committee, and copies have been made available by the Vote Office for the use of Members and others.

2. The transcript is an approved formal record of these proceedings. It will be printed in due course.

Oral Evidence

Taken before the Committee on Members’ Expenses

on Tuesday 18 October 2011

Members present:

Adam Afriyie (Chair)

Guto Bebb

Mr Edward Leigh

Priti Patel

Mr Nick Raynsford

Stephen Williams

________________

Examination of Witness

Witness: Dr Fiona Alexander, General Practitioner, gave evidence.

Q115 Chair: Dr Fiona Alexander, welcome to our inquiry today. What the inquiry is about overall is that we are examining the Parliamentary Standards Act 2009, which introduced IPSA and all of the new payment schemes and arrangements for Members of Parliament. We are looking at the Act and saying what the aims of the Act were and asking whether or not they are being achieved. We are very interested in the evidence that you gave because we are very concerned to find out in the operation of the Act and the way that IPSA do things if that is having an impact on the well-being of Members of Parliament and on the institution and whether there may need to be some changes at some point in the future. So thank you very much indeed for coming along today and giving up your time, and thank you for your very well written evidence.

Can I start by giving you a few moments to talk us around your paper, a brief introduction to what you sent to us, and then we will ask more specific questions?

Dr Alexander: About eight years ago we were approached to offer emergency services to both the House of Commons and the House of Lords because there was a gap in medical care. Since that time I have been the clinical leader for that within our practice . I   have seen a good proportion of all Members that have come through in that time , so I have quite a broad experience of the kind of problems that have presented and also got to know quite a few people. P eople don’t tend to come unn ecessarily. They are very stoic; they are very robust as a general rule. So I have seen some changes over the past few years , which is what prom pted me to say I would like to come, because I have noticed over the last 18 months there has been a change in my perception about the kind of problems that walk through the door and the psychological and physical state of the people that I see who are both Members of the Lords and the Commons. To anybody else maybe that is a subtle difference but my job is to look at people, to assess them with in a very short consultation. T hat is what I have been doing for the last 16 years. That is what I do with my NHS patients and that is what I do with Members of the House who come to see me.

It has struck me that they are less well. That is in the context of there being about 10% of the Members who attend the surgery, so that leave s 90% that I don’t see. But when you look at it over a course of eight years, in the first couple of years things were very different. We had a high percentage , 25% , of the patients that came to see us in the first few years was for something simple like ear syringing and over the course of time things have changed , but none more so than in the last 18 months. We had our lowest atten dance in 2010 when there was a g eneral e lection with the expenses pub licity and I think people were thinking about what they were doing and after the g eneral e lection we didn’t see much over the summer until last September . Then we have had a notable increase in the numb er of people coming to see me.

It struck me very much that they are tired . W e had a higher incident of che st infections last winter. Y ou could argue that in the winter there are lots of chest infections but when I   look at my general practice - we have 12,000 patients - you get a general feel about what is happening across the board. They were more unwell compared to previous years in comparison to other people. What I mean is that there had been a change in the kind of chest infections that came fr om the House of Commons and House of Lord s , which I think is a reflection of the fact that they were more run down. Previously I had been giving them antibiotics and they would go away and be fine whereas on this occasion there were several Members who came two or three times and just could not shake the infection.

The body langu age of people walking in is very different. Not w hat they say, because they don’t come in and complain, it is just the way they talk, the way they loo k, their physical actions, the speed they speak at . If I do ask them, "How are you feeling?" they don’t complain too much about what is going on but you can just tell that life is not easy. For example, the things that strike me are, when I say to someone, "I don’t think you should be alone tonight. Where are you going, who is looking after you?" , and they will be in a hotel room. I think if that is a one-off that is fine , but that is not conducive on a regular basis to good health.

Q116 Chair: Am I right in thinking that the MPs are certainly not coming to you to complain-they are coming for a medical condition and then you are making other observations?

Dr Alexander: Yes. They don’t come to complain. Nobody ever comes to complain. That is not the nature of the kind of people that work in the Lords and Commons; they don’t. If you ask them, they still don’t really complain. They accept that as part of their working life, but it is evident that it has changed with the 24-hour accessibility now, which was not present even eight years ago. There is less family contact, there are more things to do, and I think from the point of view of this somebody asked me, are the expenses part of the problem? I think no matter what all the other stresses are, and there are clearly a lot of other stresses, if somebody doesn’t have a stable place to live, doesn’t eat regularly in a home rather than in a hotel or a restaurant, doesn’t have access to their family and doesn’t have access to a nice stable lifestyle, they are not going to be healthy and they are not going to be able to do the job properly. Clearly, from what I am seeing, a proportion of them, they come to see me.

I commented that their gastrointestinal problems have rocketed from three to about 18 in the space of that time. That is significant because that is things like acid, which is stress-related; irritable bowel, which is definitely stress-related. All those things in the people that I saw, you couldn’t really relate them to anything else. It was just as if it had come on recently. That could go with a poor diet or excess workload-a number of reasons-but clearly it is something that is out of the ordinary for the last eight years. There is no other year with a figure like that.

Q117 Chair: I am quite surprised by that.

Dr Alexander: Yes. So I would be interested to know, if you ask the questions of all the people that we have not seen, how many of them-because they get on with it, they ignore it, and very often people won’t complain. If I ask them about something, they will then say, "Oh yes, I’ve had so-and-so and so-and-so". I have had people come and see me and just say, "I’ve got a bit of a cough" and then when you go into the questions you find out there are a whole lot of other things underneath and they are just not very well.

Q118 Priti Patel: You have touched on the clinical sample base in terms of the number of patients you have at your practice. What I am interested in is obviously in the past year or so there was a lot more significant illness, the numbers that you have alluded to sound quite disturbing as well. Are you able to say if that is among older Members of Parliament, newer Members of Parliament? Obviously since the last general election we have seen quite a change in the people here.

Dr Alexander: I had a look at the figures. If we break it down to take the whole numbers of patients, about 25% are Lords and 75% are Commons that come in, and of the Commons about one-third are new and two-thirds are old. That has been the case last year and this year. That was stable and it has not changed since at least this Parliament.

Q119 Priti Patel: In terms of the illnesses that you refer to, are they more specific to Members of Parliament or are they similar to the general sort of people that you see as a GP?

Dr Alexander: The chest infections are very common whoever you are. I was just struck by the fact that normally they would shake them off whereas this time people that I did see had been ill for two or three weeks before they came to see me and still took two or three weeks to shake off the infection afterwards, which is a long time to have a chest infection and I wouldn’t expect it to last that long unless there was an underlying cause.

Q120 Priti Patel: On the numbers, I know you referred to the winter period last year for chest infections, which obviously is a high activity time for people to get ill, but have they been quite consistent this year, for example, going into the spring and the summer in numbers that you are seeing?

Dr Alexander: We have had a lot over last winter. In the summer people don’t often get chest infections due to climate, temperature and other factors. Chest infections are September onwards through to about March or April and that is reflected across the whole of general practice. Looking at the figures, it is just that there were about 25% more and they were taking longer. That means that some people were less able to do their job due to ill health for whatever reason and they never give in. They won’t take time off sick.

Chair: Gut o, would you like to pick up on a little bit more maybe around the reasons for the illnesses?

Q121 Guto Bebb: Yes, thank you. In relation to these symptoms and the complaints that you have been articulating, are they generally classic examples of illnesses related to stress?

Dr Alexander: I think you could say the gastrointestinal ones are very commonly related to stress. Whether it is the acid or whether it is irritable bowel with abdominal pain or whether it is diarrhoea, all of those are very well recognised as being related to stress, exhaustion and working practices. Chest infection per se is not, but the length of time it lasts indicates to me that somebody is rundown, tired and possibly not looking after themselves as well as they might.

Q122 Guto Bebb: In terms of any reasons for this, is it in your view easy to pinpoint an issue that is causing this upsurge in complaints from MPs?

Dr Alexander: You can’t ever pinpoint one issue and I am sure, looking around everybody, there are half a dozen issues that you could pinpoint. From my point of view, if we are asking specifically about whether their living conditions will affect it, clearly they will because if you don’t have adequate support, if you don’t have adequate living conditions, then that will affect the way people eat and sleep and their general well-being and that has a direct impact on their health and their ability to do their job properly.

Guto Bebb: Wow. I feel depressed.

Chair: But enlightened. I think that is probably the clearest exposition I have heard of the impact on MPs in the current Parliament in the context of the country and also in the context of previous Parliaments. Thank you very much indeed. It is very much appreciated. Thank you for giving up your time and thank you for making the effort to keep us informed.

Dr Alexander: Thank you for asking me.

Examination of Witness

Witness: Martyn Taylor, Compliance Officer for IPSA, gave evidence.

Q123 Chair: Hello, Martyn. Welcome to our inquiry. We very much appreciate you giving up your time. I know that you are acting Compliance Officer, among other things, and you have had your hands pretty full since you took over the role. I very much appreciate you taking the time to come and see us and to hopefully enlighten us about some of the issues around compliance and some of the challenges that maybe have been faced in the past and which hopefully are going to be resolved for the future.

Let us start by talking a little bit about your independence. I appreciate you are in an interesting position because you are an acting officer and not the permanent replacement. You talk in your paper to us about being functionally independent but your appointment was made by IPSA, you are paid by IPSA and you will probably return to IPSA afterwards. Can you just talk me through what you mean by functionally independent? Also, have you had to remind the board that you should be functionally independent, especially given that you have been working for IPSA?

Martyn Taylor: Sure. Thank you. By functionally independent I mean that in carrying out the functions as defined by the statute, that is to conduct reviews into determinations made by IPSA about MPs’ expenses and to carry out investigations into claims made by MPs, I am independent. The board has no place in those investigations or in those reviews. It does not interfere in those investigations or those reviews. You are right that the post-holder is appointed by IPSA, recruited by IPSA and paid by IPSA, but it is worth remembering that the permanent role is a fixed-term five-year post that can’t be renewed. So in that sense they have no particular reason to be beholden to the board.

Q124 Chair: To be a bit clearer, your functional independence in practical terms means that you carry out investigations without interference and the reviews without interference. And the publication cycle as well?

Martyn Taylor: That also. IPSA does provide the Compliance Officer with procedures for investigation, which are the result of a process of consultation. Certainly I have had some involvement in framing the ones that are currently under consultation, Experience of the past year or so has shown that the original procedures were not working quite as well as they might and so the time was right to look at them again. Hopefully the new set will make matters a little easier. But beyond them framing the way that the investigations are carried out, I am independent.

Within those procedures are some provisions about publication. They do give the Compliance Officer discretion over not so much whether or not he publishes but when he publishes. So there is independence in that area as well. It is probably the least helpful bit of independence he has in truth but it is there.

Q125 Chair: The written evidence that you have given us, did you show that to IPSA before sending it in?

Martyn Taylor: I ran it by the chairman so that he was aware of what I was saying. It seemed courteous to do so. Yes.

Q126 Chair: Were any changes made subsequently?

Martyn Taylor: No.

Q127 Chair: Were any comments made or any helpful suggestions?

Martyn Taylor: He picked up on a couple of points of grammar. That was pretty well it.

Q128 Chair: Were there any points of substance?

Martyn Taylor: There were no points of substance made, no. He thanked me for giving him sight of it and that was it.

Q129 Chair: Are you aware of any situations in the last 18 months where a Compliance Officer, or you in your role or being nearby or anyone holding the function, has had to remind the board about the independence of the role?

Martyn Taylor: No. My experience of the board is that they are quite clear that it is not for them to be involved in the investigation. Their job is simply to recruit the person to the job and to provide the Compliance Officer with the means he or she needs to fulfil the duties as set out by the Act.

Q130 Chair: Just moving on a little bit, do you think it is appropriate that the administrator and the regulator and the compliance function are all pretty much housed together in the same operation, if I can put it that way? Do you think there is any possibility that that may create unnecessary tensions?

Martyn Taylor: I certainly don’t think there is a problem with the administrator-regulator elements of IPSA. It is a small organisation, a small outfit. It has a fairly defined remit. The regulation on IPSA’s side is about setting the rules of the scheme and ensuring that the rules are adhered to. They need to work with the administrators on that. You have seen twice now already they have amended their rules to some extent. Some of those changes are undoubtedly the result of feedback they have received from the administrators. I can’t see much value in splitting up a small organisation like that into two separate organisations. I don’t know whether that would be the proposition.

The compliance function is tiny. It currently is just me and one member of staff and me only three days a week. It makes sense for them to share offices, to share services. Whether you would house them with IPSA or house them elsewhere I am pretty ambivalent about really.

Q131 Chair: Are you aware of any other bodies set up in the same fashion? I remember the National Audit Office report said that IPSA was unique in the entire world in terms of having a regulator with an administrator and a compliance function. Obviously this is not your core function as the Compliance Officer but I was just wondering if you are conscious that there are other models of doing this and that there could be even the vaguest possibility of there being another way of doing it.

Martyn Taylor: I am sure there are possibilities of doing it in a different way. Whether it would be a better way, I don’t know. I am not aware of any other bodies that work like that.

Chair: Thank you very much indeed. I am going to hand over to Nick now. He has the next line of questions for you.

Q132 Mr Raynsford: Can I take you, Mr Taylor, to your written submission and in particular to annex A, the breakdown of cases, where you say that to date some 41 investigations have been opened, 39 have been closed, 18 after a preliminary investigation, 21 after a substantive investigation? Then you go on to list the categories. Overwhelmingly they are general administrative expenditure issues. Is that a correct picture?

Martyn Taylor: That is right. That is a correct picture, yes.

Q133 Mr Raynsford: Can you just tell us a little bit about the type of cases?

Martyn Taylor: Yes. You may know that I published last week the results, the reports, of some 21 investigations, 20 of which were about the use of party political logos on websites, which is a breach of the scheme. Those fall under the general administration category. That is the larger part of those ones.

There have been some preliminary investigations and complaints around mileage, around travel more generally and some subsistence claims complaints. I should make clear that there is a difference between the preliminary investigations that were carried out and the complaints that the post-holder looks at and decides whether or not to progress to, firstly, the preliminary stage and, secondly, the substantive stage.

Q134 Mr Raynsford: I am a little bit confused, because you have mentioned travel and subsistence but that is a separate category and there are only four cases listed in that.

Martyn Taylor: That is right. So that covers mileage ones and it would cover anything in addition about subsistence. There have not been any preliminary investigations into subsistence. There have been some enquiries and complaints about subsistence.

Q135 Mr Raynsford: Going back to the general administrative category, which is clearly the very large proportion, are there any other particular groups that come to your mind apart from those involving the use of party political logos?

Martyn Taylor: There was one that I am aware of that was about IT, whether or not there was an over-claim on IT. There wasn’t, so it was closed at the preliminary stage.

Q136 Mr Raynsford: In your written submission you say at paragraph 32 that you regard the requirements around conducting preliminary investigations before carrying out substantive investigation burdensome, both for the Compliance Officer and for MPs who may be subject to investigation for minor technical breaches. Is it your view that a large proportion of these cases are minor technical infringements?

Martyn Taylor: Certainly some of them may have been. At the time the investigations were opened it wasn’t necessarily clear. There had been an apparent breach and a decision was made to look into that further. You don’t necessarily know when you open an investigation where it is going to lead but we can look back at them and we can say some of those might have been more technical breaches. It is a young function. I think there are lessons to be learnt as we go along.

Q137 Mr Raynsford: In your judgment, in what proportion of the cases that you have had to deal with was the problem really just to do with a lack of understanding of the rules, rules that are in some respects complex and difficult to understand, and the absence of advice?

Martyn Taylor: I think in the cases that I have dealt with I have not encountered areas where the rules are particularly complex. I published one last week about accommodation. The rules on that are quite clear. The ones around websites and the rules about the absence of party political logos are quite clear. I don’t think I have encountered any where complexity around the rules has caused a particular problem.

Q138 Mr Raynsford: Of the 21 cases that you have recently provided comments on, you said that 16 were partly the fault of IPSA because its validation procedures should have stopped the reimbursement. Is there not an issue here about why people were not advised better at an earlier stage before getting into the whole panoply of an investigation?

Martyn Taylor: What I also make clear in those reports is that I set them in the context of when the breaches occurred. It was within a period fairly shortly after the scheme was launched when there was a general learning process under-way, both by MPs and by IPSA. IPSA failed in a number of areas at that time and I make that quite clear. I am not sure that the advice about websites needs to be much clearer than it is.

Q139 Mr Raynsford: Finally, can I just come to the issue of cost-effectiveness? In your report you indicate that the cost of the compliance operation in 2010–11 was £307,000. Your statistics show that you had 18 complaints during that period, May 2010 to March 2011, which according to my calculations means a cost of £17,000 per case. Do you regard that as cost-effective?

Martyn Taylor: If I may, I would rather not reflect on the past here apart from to say that in those first months there was a lot of work that needed to be done to set up the whole process for the compliance office; setting up the processes and procedures for investigations; working with IPSA on the initial set of procedures for investigations; testing the investigations within the office; recruiting staff. Quite a lot of work needed to be done in advance of any investigations being launched. Where we have got to now is the position where we have a clearer picture of what the caseload is. As a result of that I have realised some quite considerable savings. I think the staffing level is probably about right now but it is something that will need to be kept under constant review.

Q140 Mr Raynsford: Can you tell us what you expect the cost of the compliance operation to be in 2011–12?

Martyn Taylor: My projection is that it will be around £265,000 out of an estimate of £340,000.

Mr Raynsford: Thank you.

Q141 Guto Bebb: Just turning to the issue of handling cases then, as a Compliance Officer to what extent are you allowed to determine your own criteria for resolving cases?

Martyn Taylor: To quite a great extent. Certainly I have the freedom whether or not to open an investigation, and I would take into account various factors before doing so. Once I get into an investigation there are certain procedures I need to go through, which are either set out in statute or set out in the procedures, but when it comes to the actual case resolution I don’t feel particularly bound in the way that I would act.

Q142 Guto Bebb: You mentioned you had some freedom to act in terms of whether you wanted to open an investigation or not. It seemed to me from your own submission and from the guidance that the issue is this fact of whether opening an investigation would be disproportionate or not. Is that correct? Secondly, if that is the case, how would you define "disproportionate" in this context?

Martyn Taylor: Certainly I would consider when deciding whether or not to open an investigation whether that is the right route to go down for the alleged breach of the rules. By proportionality I would mean the nature of the alleged breach, the amount of money involved in it, what the likely cost of an investigation might be to the office and whether that would be worth it, and if not what the alternative means of resolution were. Is it something I can refer back to IPSA, for example, for them to get in touch about? An important element is that it is transparent. I think, though, that the proportionality aspect is critical to whether or not this position is executed successfully or not.

Q143 Guto Bebb: A final question. Where you have undertaken an investigation or looked at a case in question, have you ever had difficulty in accessing records from IPSA, for example, or having access to IPSA board members on specific issues?

Martyn Taylor: No. One of the changes, though, that hopefully will result from the current consultation is that I will no longer need to open a preliminary investigation before I can make enquiries of IPSA or of an MP about a particular complaint. It should be a more fluid and easier process before I then decide whether or not to open a substantive investigation. But no, I have not had any problems receiving information from IPSA when I have needed it.

Q144 Priti Patel: This is just really for information, I guess. I am generally interested in the complaints procedure and I see what you have outlined in your paper about preliminary investigations. I would like to know, are copies of the original complaint sent to Members of Parliament straight away when a complaint has been made as well as notification that they are being investigated? Also, if the investigation does not go ahead and in your capacity as Compliance Officer you decide that it might be vexatious, for example, would you still notify the Member of Parliament that a complaint has been made?

Martyn Taylor: My practice has been not to alert a Member immediately when I receive a complaint but when I decide how to deal with it to let them know. So if I receive something that is obviously malicious, vexatious or a nonsense, I will let the Member know that I have received such a complaint. Equally my practice is that when I launch a preliminary investigation or a substantive investigation I will alert the Member to whom the complaint is, unless there are very good reasons not to do so.

Q145 Chair: Can anybody complain about an MP? Could somebody from overseas complain about an MP, a foreign national?

Martyn Taylor: I wouldn’t necessarily know if it were a foreign national but, in effect, yes. We receive a range of complaints from a range of people including, as it happens, from MPs. There is certainly a good chunk of those that come from local political opponents. A lot of those have little merit; some of them have been progressed to investigations.

Q146 Chair: Am I right in thinking that as obviously the acting Compliance Officer, but with the Compliance Officer function, you are judge and jury on whether or not an investigation should be opened, whether it is preliminary or substantial? That is your function; you take it on your own shoulders?

Martyn Taylor: That is my function, yes. There is, of course, a right of appeal.

Q147 Chair: To whom?

Martyn Taylor: To the First-Tier Tribunal.

Q148 Mr Raynsford: Can I come back to the issue of transparency? In response to the Chairman’s question at the outset you said that the Compliance Officer was independent in determining when the name of an MP against whom a complaint had been made was published but not whether it was published. Does that imply that IPSA requires you to publish names?

Martyn Taylor: No. The procedures do set out that if there are exceptional circumstances the Compliance Officer may defer publication and I suppose deferred publication could mean indefinitely.

Q149 Mr Raynsford: But only in exceptional circumstances?

Martyn Taylor: Yes, and it would be for the Compliance Officer to decide, I think, what would be exceptional circumstances.

Q150 Mr Raynsford: So normally the assumption would be that the Compliance Officer would publish the names?

Martyn Taylor: Yes.

Q151 Mr Raynsford: Even if this was a matter of a relatively small, trivial or indeed vexatious complaint?

Martyn Taylor: Yes. The statute pretty well presumes that it would be published as well. If it is a matter that is small and trivial-as I have said, I think this is a learning process at the moment-it may be that in future those cases don’t necessarily get progressed to a full investigation.

Q152 Mr Raynsford: Have you, or to your knowledge has your predecessor, ever been in a position of worrying about the publication of a name that could be damaging to someone’s reputation in a case where there was little merit or substance to the complaint?

Martyn Taylor: To date the only names that have been published are those of completed investigations, so that is the 21 I published last week. It is something that I am acutely aware of. I need to be very careful in the way that I handle these cases so that I do not unfairly damage an MP’s reputation. I certainly hope that in those cases where IPSA had fault I balanced it in a way that people would be able to see that it was a game of two parts, as it were. I have worked closely with MPs and Ministers in the past. I think I am pretty aware of the different pressures that many of you face and I am alert to that.

Q153 Mr Raynsford: Would it not be more consistent with the concept of the independence of the Compliance Officer for the Compliance Officer to be able to reach a decision as to whether or not a name should be published rather than having to operate within a rule that applies in all but exceptional circumstances?

Martyn Taylor: I suppose the concern would be that both I and you could be accused of backroom deals, secrecy and all the rest of it. I have talked to the Parliamentary Commissioner of Standards about this and he certainly has said that he has found publishing names at the start of an investigation was a way of reducing that sort of tone of debate.

Q154 Stephen Williams: Can I just pick up some loose ends? In your memorandum you make it clear you are the third person to discharge these duties. Mr Lockwood was the first interim who worked for three to four days a week, you say in your memo, then Mr March, who was employed permanently but left after three months, and then you. There is a curious phrase in paragraph 21 of your memorandum, "On 27 July Mr March left and IPSA’s Chairman, Sir Ian Kennedy, invited me to take on the Compliance Officer’s duties on an interim basis from 28 July". So one person left and you started the next day. Does that mean you were already working for IPSA?

Martyn Taylor: I was working for IPSA. I had been with IPSA since January of last year. So, yes.

Q155 Stephen Williams: So there was no open competition procedure for quite an important post?

Martyn Taylor: There will be and there is currently one under way for the permanent post. I think that is why it is right that the interim post can only be filled for a short period of time, the six-month period. There were quite a large number of investigations under way at the time the vacancy arose. It strikes me there was some sense in having somebody in the post who was at least familiar with the functions of the Compliance Officer and somewhat familiar with some of the cases. It meant that I could step in and pick it up pretty quickly without extending for too long the period in which the investigations were continuing. I took on the role. I reviewed the cases and I dealt with them as swiftly as I could. I think if you had gone through an open and fair recruitment process immediately when the vacancy arose, you would have had a hiatus for quite a long time and left a lot of people in limbo.

Q156 Stephen Williams: So your successor will be appointed by early January by the sound of it. Is that right?

Martyn Taylor: That is the intention, yes.

Q157 Stephen Williams: But you will have dealt with most of the cases. From what you said, your two predecessors opened lots of cases but you have closed most of them in your temporary period.

Martyn Taylor: That is right, although I am still dealing with a number of complaints, some of which may progress to investigations.

Q158 Stephen Williams: In such a short space of time, three people doing the role so far and four people in less than two years would be considered quite disruptive in most organisations. Do you feel that would be a fair description of how it has affected people?

Martyn Taylor: It is not ideal but I don’t think it is desperately problematic in that it is a very small function. It is now one member of staff and the Compliance Officer. That member of staff is knowledgeable and knows what she is doing and the role is not particularly complex. It should not take very long for the new office-holder to work their way into it. It is not ideal but we are where we are.

Q159 Stephen Williams: You are part-time at the moment. Is that right?

Martyn Taylor: I am part time.

Q160 Stephen Williams: What do you do for the rest of your time?

Martyn Taylor: I look after my 10-month old twin daughters. My successor will be recruited on a part-time basis as well.

Q161 Stephen Williams: Continuing Mr Raynsford’s earlier string of questions, the cost to the organisation is quite significant for that part-time position. Would you say that was fair?

Martyn Taylor: I am not quite sure what you mean.

Q162 Stephen Williams: Costs were in the order of £300,000. You were predicting it might be in the order of £250,000 going forward. For a part-time position with one support member of staff, I think that seems quite a lot

Martyn Taylor: I think for the next financial year it will be significantly less again. We have not done an estimate yet but I would imagine it will be somewhere below £200,000. We have offices that cost; there are shared costs with IPSA. I reckon the staffing costs next year will be about 50% of what they were this year.

Q163 Stephen Williams: I have not seen the advert for your replacement. Maybe that is something we should have seen. What sort of skill set should they have? Should they have run a payroll function in a major plc or worked in HMRC perhaps?

Martyn Taylor: My assessment of this is that it is not a traditional compliance role. It is not necessarily like a compliance job in a bank where you are dealing with possibly a lot of quite complex data, complex transactions. The Compliance Officer’s remit is pretty tightly defined. I can only open an investigation if I have reason to believe that there is a wrong claim or a wrong payment. I can only start an investigation if I receive a complaint about it. I can’t say, "I will have a look at this particular area and see if there is anything strange going on with that". So it narrows down what is required. I think a critical aspect of the job is exercising judgment as to what is or is not proportionate in conducting an investigation and looking for alternative avenues for resolution if they are available, within IPSA for example.

Chair: Thank you very much indeed, Martyn and I hope life goes well with your twins. Thanks very much for coming.

Examination of Witness

Witness: Sir Christopher Kelly, Chairman, Committee on Standards in Public Life, gave evidence.

Q164 Chair: Welcome, Sir Christopher Kelly. We are pleased that you found the time to join us today. I commend you on your efforts in monitoring standards in public life and on the level and depth of research and effort to which you go to make sure that your findings are valid and sustainable. I very much admire the work that you do and I think you have been doing a very good job. Thank you very much indeed for preparing the evidence you have put forward to us. It has been incredibly useful in our deliberations.

I am going to ask a couple of introductory questions and then we will move on to different lines of questioning. I think my first general question to you is clearly, given that IPSA did not adopt many or some of the recommendations in your Committee’s report, do you think that some of the problems we are seeing are a result of the rejection of some of your recommendations?

Sir Christopher Kelly: I don’t think I would claim that, no. They are independent; they were set up to be independent. We thought we had done a thorough job. I don’t find it surprising that if you set up an independent organisation and give them statutory responsibilities they should want to look at things again. There clearly were a number of difficulties, to put it no stronger than that. I am not sure I could claim it was as a result of not accepting our recommendations. Some of our recommendations were, anyway, left to be fleshed out. They were about the principles that we thought should be followed by the scheme, and quite deliberately we left some of the details to be worked through. We did not think that we were necessarily competent to deal with those because they were the sort of thing that needed to be done in discussion and consultation.

Q165 Chair: Thanks very much. In paragraph 17 of your evidence you make it clear that there is some way to go, perhaps, to achieve the right balance between preventing the misuse of taxpayers’ money, if you like, but also enabling the organisation or the function it performs, the administration it performs, to be able to do those functions well. I wonder what kind of things you had in mind in writing paragraph 17, just to tease it out a little bit.

Sir Christopher Kelly: Had you asked me to make an introductory statement, there were only one or two things I would have said, but one of them is that we were quite clear, as a Committee, when we were writing our report that basically what we were tasked with doing was to make recommendations about an expenses scheme that would support Members of Parliament in doing their jobs.

Of course, given the history, it was important that that scheme should be done in a way that commanded public confidence but the whole purpose of an expenses scheme is to support people in doing their jobs. It did seem to the Committee that, at times, that balance has been struck in the wrong place, that some of the things that were being done looked as if they were making your job more difficult rather than easier. Quite a lot of those things, as far as I can tell sitting where I do now and no longer concentrating on this area, have since been dealt with as a result of the consultation and, no doubt, there is further ground to be made up there.

Q166 Chair: It was quite interesting that when Sir Ian came before us he made it very clear that the wording in the Act didn’t quite say that the purpose should absolutely, categorically be to support MPs in doing their duties. I wonder again, from your evidence and from your observation, if the Act were to be opened up-and that is what we are reviewing at the moment-do you think it would be worth while having a quick review of that particular objective to make sure it was clearly demonstrated that that was the primary purpose?

Sir Christopher Kelly: I am not a lawyer, of course, and Sir Ian is, so I hesitate to express a view on that other than to say, having read what he said, I looked at the legislation, and it seemed to me it was capable of being interpreted in a way that reinforced the fact that the purpose of the organisation was to provide a cost-effective, value-for-money way of supporting MPs by reimbursing their expenses, but, as I say, I am not a lawyer. You will need to ask people more expert than me.

Chair: Thank you very much indeed. That is my preliminary questions. You have done excellent work on public confidence, the definitions of it, the measurement of it and I think Priti is going to pick up on-

Q167 Mr Leigh: Can I just ask one question? It is just to take up the point that things were different, that IPSA haven’t done the same. One of the things that they have not done is take up your idea, which is in paragraph 11, "In our report, we made a recommendation that a commercial agent should be employed with the task of finding and maintaining rented accommodation for new MPs, similar to a scheme in place in the MoD". I just want to try and understand your thinking on this because, as you appreciate, Members of Parliament are quite different from normal businessmen; they don’t just go on business trips occasionally. They spend half their life with their family, many of them in one place, and half their life with their family in another place. I just wondered whether you would like to spend half your life with your family in an MoD housing estate?

Sir Christopher Kelly: With respect, that was not the suggestion. If you read the recommendation carefully, you will see that is not the suggestion and the suggestion was that consideration should be given to doing the same thing that the Ministry of Defence does for officers who are deployed in Whitehall or elsewhere away from their normal station.

Q168 Mr Leigh: Yes, but they are deployed for a short time.

Sir Christopher Kelly: No, some of them-

Mr Leigh: My question I have put to you is that MPs are very different from other people. They spend half their life with their family in one place and half their life with their family in another place. Would you really want to spend half your life with your family in, frankly, an institution?

Sir Christopher Kelly: Well, if you let me finish, if you look at that scheme you will find, I think, that the people covered by it are not in an MoD housing estate. They are put into rented accommodation in the centre of London, in the case of those who are posted in London. The point of that recommendation was exactly the opposite of what you are suggesting. The point of that recommendation is in a sense the same sort of idea as the notion that you ought to separate out salaries of your staff and office accommodation. The notion is that if there is going to be a move away from mortgage interest towards rent, that giving the responsibility for finding the rented accommodation to an agency would mean that the agency would then have to take on board all those issues of how much you had to pay in order to have a reasonable flat of the right size for whatever your family or other circumstances were, in a reasonable distance from-

Q169 Mr Leigh: You realise it would be fantastically expensive for the taxpayer going through a commercial agency, irrespective of the fact it wouldn’t be any kind of home. When people are with their family for half their life, they do like to have some sort of home. Irrespective of that-we will leave that on one side-you don’t think that it could just lead to an exponential increase in costs using commercial agencies in central London to provide a family home for MPs?

Sir Christopher Kelly: I don’t think you can have it both ways. Employing an agency is not necessarily an expensive way of doing things because you get scale and it is entirely neutral on the type of accommodation. The type of accommodation that is provided is something that somebody else can specify. The point of having an agency is it can be done more cheaply, or that is what the Ministry of Defence told us, it can be done more cheaply, and the need to justify what is spent in order to provide that standard of accommodation passes from the individual MP and goes to the agency. Since an awful lot of the difficulties that arose with MPs’ expenses were about the provision of accommodation, it seemed to the Committee that the notion of taking that possibility of criticism away from you was a good thing to do rather than a bad thing.

Chair: Thank you very much indeed. We are slightly digressing but thanks very much indeed for clarifying your comment.

Q170 Priti Patel: I am interested in public confidence in MPs’ expenses and the system, full stop. Obviously in your capacity as Chairman of the Committee on Standards in Public Life you must see quite a bit of data and viewpoints on public confidence. I would be interested in your view on that. Also I wouldn’t mind knowing your view on IPSA, whether or not you do think the public do have confidence in the new system of MPs’ expenses.

Sir Christopher Kelly: I suspect I see the same surveys as you do. The Committee runs its own survey, which happens every two years. The last survey we did was in December of last year and January. I am over-simplifying, but what that showed was a continuation of what had been apparent in earlier surveys of a downward trend in confidence in MPs.

At the same time as we did that-it was a questionnaire survey-we commissioned an online survey asking the same questions in an effort to see whether you got the same results and, therefore, whether in future surveys we could do it more cheaply. Those questions were repeated in July by the University of Nottingham and what that showed was that since January there has been an increase in confidence, still to a low level but an increase in confidence.

Has IPSA contributed to it? Was that the second question?

Chair: That was the question.

Sir Christopher Kelly: I think there are two things that are important for confidence. One is the public understanding that the level and detail of MPs’ expenses is now determined by an independent body and not by the House itself. I think that was an important thing to happen.

I think the second thing that will affect confidence is the disappearance of stories about the misuse of expenses, and that depends upon two things. It depends on whether or not there is any misuse of expenses, clearly, and on the way that the press report what happens. My impression is that the degree of media interest has gone down, as you would expect it to go down. There is a precedent, I think, in Scotland where stories about MSPs’ expenses have not gone away but since they reformed their system, the degree of interest in MPs’ expenses is, I understand, much less than it was, to an extent that some of the things that they brought in, when they initially brought in the scheme, they have now stopped doing them.

Q171 Priti Patel: On that point, it is also about the language that is used externally when this is discussed particularly in the media. For example, under the current scheme we have allowances like the London weighting allowance, which is set and it is not controversial and it is set by IPSA so it is independent. How would you view public confidence with regard to allowances versus expenses, which seem to be much more expensive and costly to administer?

Sir Christopher Kelly: This is clearly a key issue. When we did our inquiry, now some time ago, the Committee did look at the notion of allowances rather than expenses in general. We came down against them for a number of reasons, but one was because it seemed to us that it was, I think the right word is, invidious if all expenses were paid as allowances rather than expenses. I know that there are some precedents for that in other countries, including Zimbabwe for example, so there are certainly some precedents for it.

Q172 Stephen Williams: And Canada.

Sir Christopher Kelly: And Canada, thank you.

Mr Leigh: And Germany.

Chair: And Denmark.

Sir Christopher Kelly: Forgive me. There are some precedents for it, but if you pay everything as allowances then what that means is the individual Member of Parliament then has to make a choice as to whether or not they spend money on things that help them provide better services for their constituents or whether it goes into their own bank account. That seemed to us to be wrong, because people ought to be reimbursed for the expenses properly incurred.

That clearly does not apply in the same strength if what you are talking about is only a portion of expenses and I know that you, Chairman, are particularly interested in housing, in a housing allowance. I think the same argument does apply to some extent but the more important argument in that context is actually history. Since credibility and trust and confidence are so important, the notion that the response to a situation in which it appeared that some of your colleagues and former colleagues were exploiting the previous system would be to move over to a system in which, instead of having to justify what they needed in order to provide them with a decent level of accommodation, they were simply handed a sum of money. I am not sure that that would improve public confidence.

Q173 Chair: Sir Christopher, do you recognise the tension here? It is not one way or other, but there the Act has multiple aims: improving public confidence, savings, value for money for the taxpayer, and allowing MPs to do their job on behalf of their constituents. There are many aims and many of these can be in conflict depending on which particular system is chosen, so it is a matter of judgment as to which approach to adopt.

Sir Christopher Kelly: Indeed. I couldn’t agree more. Using a commercial agency based on the MoD experience, which found so little favour with Mr Leigh, was a partial attempt to find a way of reducing the cost and the time that MPs needed to spend on particular-

Q174 Chair: If we could look at a few details, and just forgive me if you do not know the answer. There are several allowances that IPSA have created and extended, in fact, such as the London allowance. I have not ever read anything or seen any MP undermined for accepting the London allowance. That is the only part of the scheme that seems to be uncontroversial and not bringing MPs-this is my personal observation and that of others. I just wondered-

Sir Christopher Kelly: People are very familiar, of course, with the notion of London weighting because it does, or used to, appear in many people’s remuneration. I was talking specifically about housing and the history of housing.

Q175 Mr Leigh: Can I just follow up on this, because it is a key point? It rather goes back to my last question. If you have an expense system, you do recognise that it does distort behaviour, it does create perverse incentives. For instance, the current perverse incentive that if you were an MP before the election and you were paying for your house or flat with mortgage interest, you are no longer allowed to do so. So what you do is you let out your house or your flat and you rent at vast cost a flat next to you. Now, that is going on on a very considerable scale at a lot of cost to the taxpayer.

So I am sure you will accept that an expense system does both create perverse incentives. Also, it is often very bureaucratic; it involves a lot of expenditure in overseeing it and people spend up to the limit of their expenses often. Don’t you recognise that, or don’t you agree that there is at least an arguable point that if you have a flat rate allowance system, people get on with their lives, which is what most people want to do anyway. They make the choices of where they live, and most people live sober, modest and industrious lives at much less cost to the taxpayer? Don’t you at least accept that is an arguable proposition?

Sir Christopher Kelly: I accept the proposition that it would be a lot simpler and administratively easier to pay a supplement rather than to expect people to claim expenses. Yes, of course, that must be true. Whether that meets the other objectives of the system is another question.

Chair: Can I move on to independence? I am just conscious of time. I don’t want to take up too much of your time, because I know we are all busy.

Q176 Stephen Williams: I just want to pick up where Edward left off in case Sir Christopher gets the impression that everyone on the Committee is in favour of broad allowances, because that would not be the correct impression. Wouldn’t there be a danger if allowances were given to MPs for accommodation or whatever it happened to be, that MPs who already have London accommodation, because they are effectively Londoners who take a seat somewhere else, would be at an advantage over MPs who represent part of the country, live in that part of the country and need accommodation?

Chair: If you could answer that one briefly, because I want to get on to independence.

Sir Christopher Kelly: I imagine you would have to deal with that issue by introducing variable allowances to cope with different circumstances, in which case you get back to an expenses system.

Q177 Stephen Williams: On the question of IPSA itself, what sort of beast do you think it is? Do you think it is a body that has a contract to administer an expenses and payroll scheme, or do you think it has more the nature of a regulator of Parliament?

Sir Christopher Kelly: Two things about that. I think it is a body that was given a very difficult task. It was asked to set up a new organisation and a new system against a very tight deadline because everyone thought it was important for the new system to be in place before the start of the new Parliament. I think that the effects of having to do those things at a rush showed in the organisation and I am very interested in the verdict of the NAO that IPSA had done-I am paraphrasing-remarkably well in that element of things.

The real thrust of your question, I think, goes back to the very first question that the Chairman asked, which is in the Committee’s view the purpose of the organisation is to make sure that you are supported in the job that you do by having your expenses reimbursed efficiently and effectively in a value for money way while, of course, providing confidence to the taxpayer that that is done in a way with integrity.

Q178 Stephen Williams: But if Parliament were Marks & Spencer and IPSA were the contracted-out payroll department of Marks & Spencer, I think there would be a reasonable expectation they would efficiently administer the payment of salaries to the manager of a small team of staff and the expenses that are associated with that, but you would not necessarily expect them to say how they interact with the customers in the shop, what time of day they turn up and what time they can travel to work. That is what I am getting at. IPSA is more regulating the behaviour of MPs and that is governing what we claim rather than supporting what we need to do in the discharge of our duties.

Sir Christopher Kelly: Of course they have to be a regulator too, because when the responsibility for setting your own expenses was taken away from the House so was the responsibility for regulating it. That was part of the package. When the Committee was doing its work, one of the things that we understood quite clearly was that the way that Members of Parliament went about their work varied enormously. All members of the Committee spent some time with different Members of Parliament to make sure that we understood what it looked like from a local level and it is quite clear that people do their jobs in different ways, and that is as it should be. So what we thought we were trying to do was devise a scheme that allowed for the fact that people did their jobs in different ways, lived in different parts of the country and had different types of constituencies and, therefore, could quite reasonably claim for different forms of expenses.

If the scheme is having the effect of making you do things in different ways solely-then that clearly is something that needs to be looked at, in my view. It should not. An expenses scheme should be supporting you. Within the limits set by the scheme, the scheme should be supporting you in doing the things that you, as the elected representatives of the people, determine that is what you should be doing.

Q179 Chair: Thank you very much. One supplementary on that. The most important thing to an MP individually, and what we strive for in the public domain, is improving public confidence in MPs, and the reputation of individual MPs has now improved. It strikes me that if an MP is able to subsidise their work, which it appears that 91% of MPs are doing, then somebody who is wealthy and able to fund their own work-they may have independent wealth, such as a trust fund, an inheritance or an inherited home, or have been successful in a business career before arriving in Parliament-has a great advantage in politics by being able to defend their reputation by spending their own money under the current system.

Sir Christopher Kelly: I think there is something wrong with the system if significant numbers of Members of Parliament are having to subsidise their own work to a significant degree. I have seen that statistic too and if that is what is happening, then clearly there are issues there that need addressing.

Chair: Thank you very much.

Q180 Mr Raynsford: Could I firstly ask a little bit about transparency issues? In paragraph 13 of your submission, you refer to your report in which you recommended that rejected claims should be published as well as accepted ones, but you then go on to say, "We continue to believe that it was right initially to do so but we also believe that there could be advantage in reviewing that requirement in the light of experience". Can you tell us what prompted you to that view and could you expand a little on how you would see this theme taken forward?

Sir Christopher Kelly: It was partly based, as the next sentence you have not read out says, on what happened in Scotland where I think the view was taken that given the history-I mean, you can’t get away from history-confidence required that people could see what was going on. I think what happened in Scotland was that people could see that people weren’t making outrageous claims and, therefore, there was no particularly interesting further evidence to be gained from publishing rejected complaints. If that is also the situation here, then it seems to me to be a perfectly reasonable thing to cease publishing rejected claims, particularly if you can also rule out those claims that are rejected because people have misunderstood, which I understand is the vast majority, but the response to that might be a greater willingness to provide advice about claims in the first place.

Q181 Mr Raynsford: Is there any reason why you didn’t go slightly further in your response to us and say you do recommend now that this should be changed?

Sir Christopher Kelly: I think it is an empirical issue, not one for expressing opinion. Has the situation progressed so much that that step could be taken without a further drop in confidence? As I say, I think that is an empirical issue rather than one on which to express a view of principle.

Q182 Mr Raynsford: Can we go on to the compliance function, which, of course, was established on the basis of your Committee’s recommendation? Has it operated in the way you intended and do you think it has proved cost-effective?

Sir Christopher Kelly: I have to be frank and say I don’t know the answer to that question. I have not been following it in sufficient detail to provide a proper answer. There clearly is an issue, which is one of the subjects of the consultation paper that IPSA has issued, about whether Members of Parliament who are being investigated should be named at the point at which they are investigated rather than when the investigation is complete. The consultation paper, as I understand it, proposes that in future Members of Parliament should only be named at the end of the period. Speaking personally, I have no difficulty with that. It seems to me to be an entirely sensible and fair thing to do.

Q183 Mr Raynsford: Do you think the Compliance Officer should have the degree of independence to determine whether names should be published or not?

Sir Christopher Kelly: I would have to think about that.

Q184 Mr Raynsford: I put this question to the Compliance Officer earlier against a background in which a certain number of cases are clearly the subject of complaints that may appear to be either malicious or pretty trivial and in which someone’s reputation could be damaged as a result of publication.

Sir Christopher Kelly: Sorry, I thought you were asking me the question the other way round. If you moved to a system in which names are not published, do you think-

Q185 Mr Raynsford: No, where names are publishable at the discretion of the Compliance Officer rather than determined by rules.

Sir Christopher Kelly: Speaking personally, I would have sympathy with the view that the rules should be that names are only published at the end of investigations. I am not sure that I understand why the Compliance Officer should have discretion about that if there was a straightforward task.

Q186 Mr Raynsford: If someone has been the subject of a malicious and vexatious complaint, their name is still published even though this might result in their reputation being damaged.

Sir Christopher Kelly: Sorry, published by whom?

Mr Raynsford: By the Compliance Officer.

Sir Christopher Kelly: But only at the end of the process-

Mr Raynsford: Yes.

Sir Christopher Kelly: But surely in those cases the Compliance Officer would be saying, "This Member of Parliament had a malicious complaint made against him and I have investigated it and it is entirely without foundation."

Q187 Mr Raynsford: But in your earlier response you did say that the public attitude would be influenced both by the absence of abuses and the way in which the press report those matters.

Sir Christopher Kelly: Yes.

Q188 Mr Raynsford: Is it, in your experience, not the case that occasionally the press may be tempted to present some issues in ways that do not altogether exonerate an individual?

Sir Christopher Kelly: Of course it is, but if the Compliance Officer is clear in the way in which he expresses his judgments and if he says, "This complaint is entirely without foundation" it is quite difficult to write a story. Even for some newspapers it is quite difficult to write a story that suggests the contrary.

Chair: I am often surprised. Thank you very much.

Q189 Guto Bebb: Can I take you back to the issue of the provision of advice by IPSA. The Compliance Officer made the case that quite a few complaints about MPs are made by political opponents, for example, and yet when an MP is unsure how to progress a claim, IPSA seems to be very reluctant to offer advice. Do you think that can be justified?

Sir Christopher Kelly: I am very sympathetic to the notion that IPSA ought to be prepared to offer advice. It may be that during the early stages when they were overwhelmed with work, as it were, that was difficult for them. Even accepting that they are a regulator, I know of other regulators who are prepared to offer advice and I have some sympathy with the notion that they should be prepared to do so, but that is not an issue for me to decide.

Q190 Guto Bebb: On some occasions, MPs have been advised to just put in a submission and see what happens, but in view of the issues surrounding MPs’ expenses you can understand why MPs would be reluctant to take the risk, I suspect.

Sir Christopher Kelly: Absolutely. I understand that completely.

Q191 Guto Bebb: Secondly, in terms of the cost of the scheme, I think I am right in saying that something like 38% of all claims cost more to process than the actual amount of the claim in question. Do you have any views about how a system can be developed that is less costly and difficult to justify in terms of costs?

Sir Christopher Kelly: I have seen that figure. I don’t understand enough about it to know whether it is the cost of claims now or whether it is based on the cost of claims over the past period, in which case it presumably does not take into account some of the changes that have already been made, including, for example, the greater use of credit cards and so on. Clearly, anything that could be done to reduce the costs is greatly to be welcomed, and there may very well be ways of doing that without in any way endangering the integrity of the scheme or the way it appears to the outside world.

Q192 Mr Leigh: As you know, MPs have to do everything online now. This is immensely bureaucratic. I don’t want to go into all the details, but presumably the whole purpose of this, from your point of view, would be to have instant transparency. If the whole thing was published that should work quite well. You apply for a journey from London to Newcastle and immediately, the moment you apply for it, it would flash up. So it is bureaucratic, but in fact it can’t be published immediately because it all has to be redacted to remove people’s home addresses and the rest of it. I wonder what you think the public actually gain from this. The MP has all the bureaucracy of doing this, but the public doesn’t gain because there is no instant transparency anyway. It is published on a bi-monthly basis, which encourages newspapers, almost, to store up all bad news. I just wonder what we gain from this online system over the paper-based system. As long as the claim is backed by an invoice, what do you think is wrong with a paper-based system?

Sir Christopher Kelly: I am not sure I have a view on that.

Mr Leigh: If you do not have a view, that is fine.

Sir Christopher Kelly: I think I regard it as a matter of detail rather than principle-

Q193 Mr Leigh: But I am just saying in terms of public confidence or transparency, that is all. But if you don’t have a view, that is fine.

Sir Christopher Kelly: I am not sure that I fully understand the question. Whether it is more practical to do it online or on paper, I would find it surprising if it is not cheaper online.

Q194 Mr Leigh: We need not go into all of it, but if I just tell you that it is quite a bureaucratic system because you have to, for instance, type in everything online, then you have to get an invoice out and all the rest of it, so in fact you are duplicating a paper-based procedure with an online procedure. That explains some of the heavy costs of the present system. Everything has to be checked and double-checked online and on paper. I am not an expert either, but I suspect that explains a lot of the increased transactional costs of IPSA compared to the old Fees Office.

Sir Christopher Kelly: This seems to me to be absolutely the sort of issue on which sensible consultation has a chance of producing the right answer. It may be that this is another issue of the maturity of the scheme. There are plenty of examples, including, for example, in the submission of tax returns, where people are familiar with the notion that you submit your tax return but you have to retain the receipts in case somebody then decides to ask to see them. Whether there is some move that is possible in that direction as the scheme matures, I really don’t know. I think people would need to talk about the advantages and disadvantages.

Q195 Chair: I am conscious of the time. One supplementary there is that we used to publish all the receipts. IPSA no longer publishes those receipts. Do you think that is a good or a bad thing? Obviously there is a cost-benefit equation here, but it seems to me that if one has collected all the receipts the public do ask, "Why aren’t they publishing the receipts?"

Sir Christopher Kelly: What does transparency mean? Transparency means that there is visibility about what it is that is being claimed and granted, and that someone has the confidence that if something has gone wrong that will be properly investigated and dealt with, and if it is an error dealt with as if it was an error, and if it is someone doing something they shouldn’t have done that it will be properly dealt with by some form of sanction. That is what is required. Everything else is a practical detail about how best to implement it.

Q196 Mr Leigh: The final question. We all completely understand that you have to have an independent body that sets the level of the salaries and the expenses and all that. We all understand that. What I am struggling with is, what happens if an approach adopted by IPSA, for the sake of argument, firstly, undermined public confidence in Parliament, secondly, cost the taxpayer too much or, thirdly, failed to sufficiently support MPs in performing their duties? What options would the country have, or Parliament have, to change the situation, or should they just say that IPSA is independent and, therefore, if it fails to support that there is nothing they can do about it? Should we have the option to change the board? What do you think?

Sir Christopher Kelly: This is an issue about accountability, isn’t it? IPSA has processes for accountability in the same way as other organisations do. From my observation, it certainly operates with a lot of attention from Members of Parliament. It has, I think, shown evidence of responding to criticism. The scheme is now in its third iteration. It is different from how it was at the beginning because it has heard criticisms that have been made, it has issued consultation papers and it has responded to that consultation. Isn’t that the way the process is supposed to operate?

Q197 Mr Leigh: So ultimately, Parliament should have no further sanction?

Sir Christopher Kelly: Parliament is sovereign, of course. You don’t need me to tell you that. Parliament can do whatever it likes, but you began your question by saying you accepted that IPSA should be independent.

Mr Leigh: On the level of salaries and on expenses and allowances, yes.

Sir Christopher Kelly: You have presumably, for reasons that you accept, given it a degree of independence and you can’t really be surprised if it exercises it. As I say, I think the only question that remains is. Are accountability processes adequate? I would have thought the evidence was that they are responding to criticism in an appropriate way.

Q198 Chair: Two brief, brisk questions to finish. The first one is, on that subject, it seems to me that the public still believe that MPs control their own pay and conditions, even given all of the handing over of pensions. It is still reported in such a way that most of the public believe that MPs still control what they are doing, even if it is a conspiracy theory. Therefore, the actions that IPSA undertake can continue to undermine the way that Parliament is viewed by the public. Naturally, we have handed over to independent control, and most MPs are satisfied with the fact that they set the rates and design the schemes. The aims of the Act are pretty clear. If it were not fulfilling the aims of that Act, and measurably so, do you think that Parliament would have a duty to intervene at some point?

Sir Christopher Kelly: You could never say never. I think the public reaction to that would depend upon the circumstances and how bad the situation was.

Q199 Chair: This is my final question to you. I have given you a lot of praise, and I mean it. Your reports are researched well, the measurement systems are great on public confidence, it is in-depth, you take different views from different angles on the way that politicians and public figures are regarded, and I have great respect for that work and the way it is presented in a very impartial fashion. If you were asked to perhaps measure the public confidence in Members of Parliament and public confidence in Parliament, would that be a task that you would be prepared to take on at some point, given that, from what we have seen so far, IPSA is not necessarily measuring it in as professional a fashion as you have been?

Sir Christopher Kelly: I am not quite sure I understand the question. We do it already in our biennial surveys.

Q200 Chair: If you were asked to do it more frequently and have a bit more of a focus on it?

Sir Christopher Kelly: We only do it every two years, partly for costs reasons-it costs money to do it-and partly because attitudes don’t necessarily change that quickly, or if they do it is not necessarily very sensible to measure fluctuations because things do change. In our surveys I mentioned in answer to the earlier question, in January confidence in journalists was higher than we had expected because, after all, journalists had played a role in uncovering what the public thought was the expenses scandal. By July, it had become apparent what had happened at News International and elsewhere and the situation had reversed itself. So I am not sure regularly monitoring this question produces information that is particularly useful. Doing it about every two years is, in my view, about right.

Chair: Thank you very much indeed for your time.

Sir Christopher Kelly: A pleasure.

Chair: Thank you very much indeed for your evidence. This session is now closed.

Prepared 2nd November 2011