Maria Miller - Committee on Standards Contents


Appendix 2: Correspondence between the Clerk of the Committee, Mrs Miller and the Parliamentary Commissioner for Standards


Letter from Mrs Miller to the Clerk of the Committee, 3 February 2014

1. Thank you for your letter of 27 January 2014, which also enclosed a copy of the Commissioner's Memorandum ("the Memorandum").

2. I am most grateful to the Committee for the opportunity to comment on the Memorandum and 1 do also appreciate your kindly agreeing to allow me until Monday 3 February 2014 to provide you with a response.

3. I think it is important that I am clear from the outset that I am deeply concerned at the views expressed in the Memorandum, The Memorandum contains a number of serious errors and is wrong in fundamental respects. This follows a flawed and protracted 13-month inquiry, which was conducted without due regard for the core principles of a proper investigatory or adjudicatory process. These failures in the inquiry have in turn distorted the Memorandum produced. More may need to be said about the inquiry process in due course and there is a great deal that could be said about it and about the Memorandum. For the present, however, I expect that the Committee will wish to focus on the main findings contained in the Conclusions section of the Memorandum (from paragraph 117) and at this stage I therefore limit my comments below to these aspects.

4. To assist the Committee I propose to deal below with the three issues identified in the Conclusions section in the Memorandum in the same order and under the same headings as set out in the Memorandum. Before that, I should also address the introductory remarks to the Conclusions section in paragraphs 117 and 118.

The introductory remarks

5. In the introductory remarks to the Conclusions, the Memorandum suggests a difficulty of establishing evidence. In particular, although acknowledging that this relates to matters some time ago, the Commissioner mentions a lack of some documents and of corroborating evidence. It is also suggested that some of my answers to questions were "very general" and that this added to the length of the inquiry. This is not a fair or complete description of the position.

(i)  I would emphasise that I have of course provided the information requested of me; and I have explained if I no longer have documents or the reasons why a document may not exist. Similarly, I have cooperated fully and always immediately agreed to documents held by the House authorities being provided to the Commissioner. This has included both hard-copy documents and a search of the electronic archives including all my electronic diaries. It is, however, not surprising that after so long some documents are no longer available. Thus, for example, the Commissioner mentions the absence of notes from the Department of Finance and Administration, but the Director General for HR and Change has confirmed to her (his letter of 27 September 2013) that "most of our records and correspondence have now been destroyed under the House's Authorised Records Disposal Practice".

(ii)  With regard to corroborating evidence, it is not quite accurate to say that there is no such evidence of my stays in the constituency. At the suggestion of the Commissioner both the constituency chairmen who have held that position for the period in question have given evidence confirming that that is where I lived. Beyond that, it would be odd if anyone outside my family kept such close tabs on me that he or she could provide an actual count of how many nights I spent in any one place very many years. It is true that the Commissioner sought further evidence and for example asked in her letter of 11 November 2013 whether there was anyone who would have seen the family walking the dog near the constituency home. But it cannot seriously be suggested that there might be someone who could be expected to give evidence about whether he/she remembers seeing our dog being walked in say 2005 (some eight years ago) and which day of the week that might have been and why we were there on that particular day.

(iii)  With regard to my own evidence, I have sought to provide answers to the questions as fully as I am able. As the Committee will see, I have responded to letters from the Commissioner on 14 occasions. To ensure that the questions raised by the Commissioner are fully dealt with many of these letters have been very detailed and lengthy, providing financial information going back more than 8 years, and including personal and sensitive information about my family. In addition, on 1 July 2013, I provided the Commissioner with a detailed report ("my Report") setting out my response to the inquiry in very comprehensive terms. Far from being general, my Report addressed the matters in the inquiry in the fullest possible detail. I have done my utmost to assist the inquiry and to provide the relevant information. Indeed one of the reasons for providing my Report was that the matter had already gone on too long and the inquiry appeared to have become diffuse and confused and I thought it would assist to provide all of the information in the fullest possible detail in one place. Throughout the correspondence, both before and after my Report, I have likewise sought to explain the position as fully as I was able.

(iv)  With regard to the time the inquiry has taken, the 13 months that have been taken have not been necessary or appropriate. They have caused me immense difficulty and have created speculation and I have repeatedly since July 2013 expressed to the Commissioner my concern that the inquiry had not been concluded. A point of comparison is that after my Report, the Commissioner took the advice of the Director General of HR and Change. She wrote to him on 12 September 2013 and it took him only two weeks to review all the relevant facts and provide a report dated 27 September 2013 (in which he considered that my ACA claims and designation were fully within the applicable rules). Despite this, the Commissioner has maintained the inquiry for several further months. She wrote to me on 10 October 1013 to say "I believe that I now have all the information which I need to complete my inquiry and am sorry that this first stage has taken so long." Rather than concluding the inquiry, however, she then wrote on 23 October 2013 to raise tangential matters which her own letter noted "may have no relevance to my inquiry".

Having set out these introductory matters, I will now turn to the three matters set out in the Commissioner's conclusions.

Was Mrs Miller's designation of her main and second home correct?

6. The Commissioner addresses this question at paragraphs 120 to 127 of the Memorandum. Her findings are that (a) she fully accepts "the matter is finely balanced" (paragraph 126); (b) she accepts I "sought to do what was fair and reasonable throughout"; but (c) that the designation of my main home should have been for the London house. This last conclusion is incorrect because:

(i)  it applies the wrong test;

(ii)  it considers the wrong factors and indulges in speculation; and

(iii)  it overlooks the actual evidence.

It is of course also noteworthy that the Department of Finance and Administration at the relevant time considered that the designation was correct and that, in his letter of 27 September 2013, the Director General considers that the designation was correct in accordance with the rules in place at the time.

7. The Commissioner's view that everyone is wrong starts from her misunderstanding of the applicable test. In paragraph 121, the Memorandum argues that the question of nights "only became relevant" if the location of the main home was not a matter of fact. This is a misapprehension. The correct approach, as was understood at the time, was that, where an MP had more than one home, the question of the number of nights was the primary test to determine the question of the main home. Even if it was not an absolutely conclusive test, it was the crucial starting point and the Commissioner is wrong to consider that it is not relevant. On that test, the designation of my constituency home was the main home (as the Director General considered). To be clear, although the Commissioner now disregards that test, that is the test that I was advised to use by the Fees Office at the time and is the test that in good faith and accurately I applied.

8. Having disregarded the test completely, the Commissioner then considers factors which she says meant that the London home was the main home.The factors on which the Commissioner relies are that we moved a number of times in the constituency, that we lived in London before I became an MP, that my children had their primary education in London, that under the IPSA scheme my claims are for the constituency, and that the London home would have been maintained even if I had not become an MP. Each of these is relied on in error.

·  The fact that we moved was because each of the moves was to a larger property which was precisely because the constituency was the centre of my family life.

·  The fact that we lived in London before I became an MP and that the London home might have been where I stayed had I not become an MP misses the point. They betray a lack of understanding of the very great changes that becoming an MP requires. Basing the position on a Member's pre-election position is not an appropriate test. It also ignores the actual evidence, as I set out.

·  In this regard, in paragraph 124 of the Memorandum, the Commissioner again conflates a test and falls into error. She considers that the London home was not established exclusively and necessarily for parliamentary duties. This is again not the right analysis. The London home was "established" long before I became an MP. The correct approach, based on the applicable rules at the time, was whether I (ignoring my family for this test) needed to maintain two homes to be able to carry out my duties. I clearly did and was undoubtedly within the rules to do so (and it has never been suggested otherwise). Once that test was satisfied, one of the homes had to be designated as the main home and this had nothing to do with whether a home was originally established exclusively and necessarily for my duties.

·  The fact that my children had their primary education in London is not indicative. I had to be in London for the main part of the working week, (Monday to Thursday days, Monday to Wednesday nights) and so when young it made sense for my children to be with me in London during the week and so to go to school in London. As soon as they were older, they went to school in Hampshire and otherwise lived in the constituency and not in London.

·  The fact that claims are now different under IPSA is irrelevant and no indication of the position at the relevant time. First of all, that is a different scheme with different considerations and secondly I have since become a Minister which I was not for any of the period in question.

9. As well as wrongly considering the above factors, the Commissioner has also disregarded the actual evidence on the issue. For example, paragraph 15(vii) of my Report summarised my evidence as follows: "Importantly, it was a conscious priority for Mrs Miller to maintain a family life as much as possible and therefore for her family to move each week with her in accordance with the demands of her responsibilities in two places. On becoming an MP, Mrs Miller gave a great deal of thought to how to balance her role as an MP with her family life and her role as wife, mother and carer. The way she sought to achieve this was to make Basingstoke the centre of family life because that was where she needed to be on weekends and during Parliamentary recesses. She also sent her children to school in Hampshire as in turn they became old enough. Thus, whatever might have been the position before the 2005 general election, for Mrs Miller and consequently the family the best way to balance family life was to make Basingstoke the main family home."

10. Having disregarded the appropriate test, taken into account misplaced factors and ignored the actual evidence, the Commissioner goes on to conclude at paragraph 125: "1 think that it is likely that Mrs Miller's main family home remained in London, and this was the home exerting the gravitational pull including during the summer months." This statement is without foundation, is not based on any evidence at all and is contrary to what I told the Commissioner. As I said in my letter of 9 May 2013: "The weekend and the school holidays was when [my family and I] were able to spend time together in Basingstoke and where I spent most downtime."Where my children went to school has no bearing on where the children lived during the summer holidays which was in the constituency with me.

11. In reality, the direct evidence before the Commissioner was that my constituency home was my main home after I became an MP. In this regard, I would also particularly ask the Committee to consider my Report which sets out the position on this question very fully.

12. Given the above and given the acceptance that the matter is finely balanced and that I did what was fair and reasonable throughout, it seems to me that the correct question now ought to be whether my designation of my Basingstoke home as my main home was a reasonable one in the light of the relevant circumstances. This also appears to be the way the Committee has approached this question in the past. In this regard, there were compelling reasons as to why the designation of my Basingstoke home was reasonable:

·  It was where I spent the most nights.

·  It was the centre of my family life.

·  There was no financial benefit to me in the designation.

·  I received clear advice from the Department of Finance and Administration as to which home I should designate, and this advice has been confirmed as correct by the Director General of HR and Change.

13. Before turning to the next question, I would also emphasise here that the Commissioner has correctly found that if I had designated the London house as my main home and made ACA claims on the Basingstoke house, I would have been entitled to make the same claims as I made and there was no financial advantage to me or additional cost to the public purse from the designation.

Did Mrs Miller or her parents receive an immediate financial benefit from public funds by living in her designated second home, and if so, did Mrs Miller reflect this in her claim?

14. This question is the only actual complaint made by Mr Mann MP and the only allegation that was set out in Mr Lyon's letter to me of 12 December 2012 which initiated the inquiry in accordance with the Procedure for Inquiries.

15. I of course welcome the Commissioner's conclusions that I acted properly in this regard, that my parents' living with me as a single family unit from long before I was an MP was not contrary to Parliamentary rules, that my case was not at all the same as Mr McNulty's (which was Mr Mann's original complaint), and that my expenses claimed were correct and appropriate. This was also the Director General's view who rightly concluded that there was no inappropriate use of public money in this case.

16. In addition to the above and what was set out in much greater detail in my Report on this issue, I would just add a short further comment given what the Commissioner says in paragraphs 131 to 133 of the Memorandum.

In those paragraphs, the Commissioner refers to the cases of Mr McNulty and Mrs Main. It is important therefore to note the different circumstances of those cases.

17. First, those cases did not involve a single family unit living together but involved independent adult members of an MP's wider family potentially receiving a clear and direct benefit from Parliamentary expenses, which they started to receive only while the relevant MP was in Parliament. That is, however, not my case. My parents are not independent. I have carer responsibilities for them and (like my husband and children) they are and have for nearly 20 years and long before I was an MP been part of my single family unit. Furthermore, as set out in my Report, they did not receive any benefit or financial gain at all from my being an MP or my having to move between Westminster and the constituency. It made no financial difference to them whatsoever, nor, unlike the McNulty case, did they (or I) receive any subsidy or support from public funds in respect of them.

18. Secondly, in neither of those other cases was there a reduction in claims referable to those other family members. In Mrs Main's case, she relied on the fact that she had reduced other of her own expenses slightly because she knew her daughter was living with her; but the Committee found that was not the right way to do it because an MP could not trade off claims not made against claims which should have been reduced. Again this is not my case. I sought throughout to act fairly and reasonably and, as has been concluded, my claims were reduced and were within what was appropriate.

19. With regard to transparency, I would emphasise that I made sure I fully and clearly explained my family arrangements to the Department of Finance and Administration. I would have been happy to have one but was not advised that a formally documented arrangement was needed and I never for one second sought to obtain any additional financial advantage from my claims. As I explained in my Report, because of my family circumstances (regardless of my parents), being an MP and a mother and trying to maintain some family life came at a considerable cost with the unavoidable need to have two family homes which the ACA did not cover and which I had to subsidise.

20. In relation to the above, paragraph 153 of the Memorandum also includes a non-sequitur. There the Commissioner suggests that because in her view there was a lack of formality in my arrangements, there was an inappropriate use of public money. This is not right and does not follow. The only issue is whether money was claimed that should not have been claimed. Apart from the Commissioner's new case in relation to mortgage interest which I discuss below and has nothing at all to do with my parents, it is clear that the claims I made were appropriate and allowable.

Were Mrs Miller's ACA Claims made in accordance with the rules and guidance of the relevant period?

21. The third area of the Memorandum addresses whether my claims (in particular in respect of mortgage interest) were within the rules.

There are two major preliminary problems with this area of the Memorandum. First, it seeks to substitute the Commissioner's findings for those already made by the Legg Inquiry. Secondly, it is an area that has never been within the scope of this inquiry. I address both of these problems first because they disclose significant mistakes by the Commissioner. I then explain how the Commissioner has also misdirected herself on this third question in any event.

22. It will be self-evident to the Members of the Committee that the heading to this section of the Memorandum entirely duplicates the inquiry undertaken by Sir Thomas Legg in 2010. Sir Thomas Legg found that I had no issues in relation to my ACA claims. In relation to this section, there is no new material and the relevant evidence before the Commissioner is the same as the evidence before Sir Thomas Legg. The Commissioner is therefore inviting the Committee to look at the same material but to form a different conclusion from that (correctly) reached by Sir Thomas Legg. She has contended that this is open to her based on the Mackay/Kirkbride case in which the Committee (in one sense but in the most limited way) looked at a case which had already been considered by the Legg Inquiry. The Commissioner has, however, completely misunderstood this case.The Mackay/Kirkbride case did not find that the Committee could consider a Legg matter afresh or might wish to reach a different and irreconcilable conclusion from the Legg Inquiry. On the contrary, in that case, the Committee considered that the questions resolved by the Legg Inquiry were "settled" by the Legg Inquiry. All that the Mackay/Kirkbride case went on to consider was that, in the case of a serious breach as found by the Legg Inquiry, the Committee could apply the same finding because it merited sanction by the Committee. The one thing that the Committee was clear it was not doing was "reopening the extremely thorough audit and review process" which the Legg Inquiry undertook. It is therefore clear from both the Legg Inquiry and the Mackay/Kirkbride case that the Commissioner's third area has already been considered and is settled. The Legg Inquiry's finding in this matter was correct and unimpeachable. There is no basis for it to be revisited.

23. As indicated above, this part of the Memorandum is also a question which was not within the scope of the Commissioner's inquiry. It was raised late in the day after the Commissioner had told me in her 10 October 2013 letter (when the investigation was already 10 months old) that she had concluded the inquiry. Thereafter in her letter of 23 October 2013, she asked about my mortgage interest which she accepted "may have no relevance to my inquiry". Following my reply, the Commissioner wrote to me by letter dated 11 November 2013 (now 11 months into the inquiry) setting out an entirely new inquiry question and asking for financial information going back to 1996, nearly 20 years ago and almost 10 years before I became an MP. After 11 months of an inquiry, this seemed extraordinary. Furthermore, the new inquiry question was not an allegation (such as the actual allegation of wrongly housing my parents) but simply an open-ended question as to whether all my claims were within the rules. This is not consistent with the Procedure for Inquiries which requires a complaint and in particular an allegation. Since that 11 November 2013 letter (starting with paragraph 3 of my letter of 26th November 2013 in which I set out eight reasons why it was wrong for the inquiry to be expanded to this further questions), the Commissioner and I have been engaged in debate as to whether this question is within the scope of the inquiry or not. I have maintained it is not and cannot be. The reason this remains important and I need to explain it a little further is that (i) it is indicative of the Commissioner's approach and undermines her conclusions and (ii) the direct consequence of the flawed procedural approach the Commissioner has adopted is that her report in this section is replete with errors.

24. It is straightforward to demonstrate that the question is not within the scope of the inquiry.

·  Both the letter of 12 December 2012 initiating the inquiry and the present Commissioner's letters of 25 April and 8 August 2013 confirm in terms the actual and correct scope of the inquiry, which does not include this third aspect. My Report considered the inquiry in the same terms and the Commissioner wrote to the Director General explaining that was her inquiry in the same terms.

·  As noted above, the third aspect was raised after the Commissioner had otherwise stated that she was ready to conclude the inquiry.

·  Despite my request, the Commissioner refused to include in the Memorandum the actual allegation as set out by Mr Lyon in his letter of 12 December 2012 and even though that is the founding basis for this whole process.

·  When the Commissioner provided a draft of the first half of her Memorandum, I pointed out that, in the section of the relevant provisions, she had included a number of provisions that had never previously been mentioned in the inquiry. I wrote "the provisions which paragraph 8 of your draft report includes as relevant to your inquiry are not provisions which Mr Lyon said he was considering in his letter of 12 December 2012. Indeed, those provisions have been mentioned for the first time in your draft report. As paragraph 20 of the Procedure for Inquiries makes clear, the letter from the Parliamentary Commissioner initiating the inquiry must 'set out the relevant rules of the House'. In compliance with this clear requirement, Mr Lyon did set out the rules of the House which were relevant to the inquiry he was considering and which he initiated. The rules he set out did not include the rules in paragraph 8 of your draft report which you are apparently now considering." In reply, the Commissioner wrote, "You are inaccurate in your statement that the rules he set out did not include those to which I refer in paragraphs 7 and 8 of my report" (emphasis added). This was incorrect. It was entirely accurate of me to state that paragraph 8 was wholly new.

·  In her letter of 17 December 2013, the Commissioner's supposed basis for this question being within the scope of the inquiry was that the first line of Mr Mann's letter of complaint says "I wish to register a complaint regarding Maria Miller's misuse of Parliamentary allowances between her election to Parliament in 2005 and April 2009." The second sentence then sets out what that complaint is, namely about my parents. As I pointed out in reply, "...the fairness of any investigation, including this one, requires it to be conducted within a framework provided by a specific and expressly set out allegation so that the exact case to be answered is clear and so that that exact case can be met. A generalised introductory reference is not a specific allegation and will not do to set the scope of an inquiry. Furthermore, it is not Mr Mann's inquiry and he has no power to specify the scope of the inquiry. Mr Lyon's letter of 12 December 2012 formulated the actual allegation I was required to meet".

·  Since the reasoning in the Commissioner's letter of 17 December 2013 was so untenable, the Commissioner's Memorandum has now switched the supposed justification to the third and fourth sentences of Mr Mann's letter. This is no better because those sentences are no more than general background to the complaint. They do not make an allegation and were never understood to make one either by Mr Lyon or by the present Commissioner when each of them put the terms of the inquiry to me. Finding a new justification for a new inquiry at the stage of the Memorandum is hardly an appropriate way to investigate a matter.

25. It is not only the justification for the inquiry that is new. The matters set out in this part of the Memorandum are also new. They include allegations that have never been put to me and mistakes that I have never had any opportunity to correct. By way of further example, I have never before been shown for comment any of the tables of figures which the Commissioner now presents. On no view is this a fair or proper way to conduct an inquiry and it goes some way to explain why the purported findings are so wrong. I therefore turn to the content of this section of the Commissioner's Memorandum. The Commissioner raises two issues under this part of the Memorandum. The first is a £50,000 increase in my mortgage in 2007. The second relates to my mortgage before I became an MP. I deal with these in turn.

The 2007 £50,000 increase

26. The first issue relates to the additional mortgage I took out at the end of 2007, which increased the value of my mortgage by £50,000. The Commissioner deals with this from paragraph 139 onwards. Regrettably, the Commissioner's new allegation here was not raised with me during the course of her extensive inquiry and I only became aware of this allegation when the Committee provided me with a copy of the Commissioner's conclusions last week. Her conclusions here are misconceived and make a number of errors.

(i)  The Commissioner appears to find that I made a claim in respect of the interest on the £50,000 additional mortgage which was not an allowable claim. This is incorrect. I did not make a claim for the interest on the £50,000 additional mortgage. This is clear from the figures contained in the schedule I provided to the Commissioner under cover of my letter of 3rd January 2013. These figures have never been questioned by the Commissioner and have been relied upon by her during her inquiry. In fact, at no stage did my claim for mortgage interest exceed the amount of the mortgage when I entered Parliament. Since I did not make a claim for this additional interest, the Commissioners' comments in paragraph 155 are particularly inappropriate and misplaced.

(ii)  Sir Thomas Legg was of course provided with the same information for his inquiry into whether I claimed ACA in accordance with the rules and found there were no issues here.

(iii)  The further criticisms of the Commissioner's approach here are less important given that there was not any claim for the interest here in the first place. Nevertheless, her second error is that in paragraph 139 she suggests that the claim was not (or in reality would not have been) allowable because (a) there was no evidence I had discussed this with the House authorities; and (b) not having discussed the additional mortgage with the authorities made it non-allowable. Conclusion (a) is not appropriate or open to the Commissioner because I have never given any evidence on the point since it has never been relevant; and the Commissioner cannot simply assume and pronounce there is no evidence of a particular issue about which I have never been asked. Conclusion (b) is wrong and a further misunderstanding of the rules. The test of whether an interest claim is allowable is not whether it was discussed but whether the claim was within the allowable categories.

(iv)  Thirdly, in paragraph 140, the Commissioner apparently finds that the rules would not permit interest on a loan which paid for improvements before I became a Member. This is again a serious error because it is an assertion without any evidence. The Commissioner is simply speculating here. There is no evidence that the £50,000 was used to pay for improvements before I became an MP and I would not have sought to claim that interest on that basis, although the point is hypothetical since I did not claim that interest at all.

(v)  Finally, in paragraph 140, the Commissioner appears to refer to evidence beyond reasonable doubt. Unfortunately, this again betrays a misunderstanding. This is not the standard of proof that the Commissioner is required to apply and in reality it is a gratuitous attempt to lend weight to a finding. It is moreover quite misguided and in breach of the established principle that an investigatory body, especially one before which there has been no hearing and which has not heard live evidence, cannot properly reach a view beyond reasonable doubt. It is also embarrassing since the findings said to be made on this basis are incorrect and unfounded, as set out above.

My mortgage before I became an MP

27. The second issue relates to an interpretation of the Green Book. The Commissioner contends that the Green Book provided that it was not possible for a Member to claim mortgage interest in excess of the original loan secured on the property when it was purchased, and critically that this rule extends to the financial arrangements by Members before they were ever elected. She therefore argues that the fact that I had remortgaged before I was an MP meant that my actual mortgage costs in 2005 could not be claimed beyond the level of the original mortgage in 1996.

28. The Commissioner's contentions are based on her novel interpretation of two rules. The first is paragraph 3.1l.1 of the 2005 Green Book which states that mortgage costs were:

    "limited to the interest paid on repayment or endowment mortgages, legal and other costs associated with obtaining (and selling) that home (eg, stamp duty valuation fees, conveyance, land search, removal expenses)"

29. It seems plain to me that the rule sets out two categories of allowable costs: (1) mortgage interest and (2) legal and other costs associated with buying and selling a home. This is clear as these two categories are separated by a comma. I am reinforced in this view because the 2003 Green Book contains the same wording save for the fact that the word "and" appears immediately after the comma. Save for confirming mortgage interest is claimable, it is of no assistance to the Commissioner's contentions. If I for one moment considered that this was the rule then I would not have claimed any amount over the purchase price. However, the point did not occur to me then and even now I think it is clear that the Commissioner's contentions cannot be correct.

30. The second rule relied upon is 3.12.1 that Members could not claim for "interest on any additional mortgages, advances or loans secured on the same property."(I might note that these words from 3.12.1 were not mentioned in the inquiry letter of 12 December 2012 or alleged against me prior to the Memorandum.) This rule was amended in July 2006 but even while it was in force the natural and ordinary meaning of this rule was that MPs who wished to take out additional borrowing could not claim mortgage interest in relation to that borrowing. The Commissioner contends that this rule has a much wider meaning to the effect that it extends to borrowing prior to an MP even being elected. Furthermore, in her view, it makes no difference if such borrowing was taken out to fund payments connected with the property that would be allowable under the Green Book at least from 2006.

31. This is with respect an interpretation that is wider than the wording naturally permits and has never previously been suggested. If the rule had that wider meaning, it would have been worded very differently. The rule would have simply said that a Member could not claim for an amount that is more than the original loan secured on the purchase of the property in respect of the original mortgage only. There are further factors that very strongly support the fact that the Commissioner's contention is unsustainable. These include:

1.  If this was the rule then one would expect that the Department of Finance and Administration would have introduced procedures to ensure compliance, such as asking a Member to confirm the initial mortgage value secured on a property. No such procedure existed. Indeed the procedure was to ask members for evidence of their current mortgage. I would add that although the Commissioner did seek the guidance of the Director-General of HR and Change on the first two issues above she has chosen not to seek his advice in relation to this matter even though I suggested to her that she do so in my letter of 17th January 2014.

2.  I am not aware of any complaints or investigations where the issue has been raised prior to this point. The Commissioner does refer in her Memorandum to the cases concerning Mr Osborne and Mr Duncan. However, both of those cases concerned additional borrowing taken out by the respective Members after they were elected. They are therefore of no relevance to this point. Indeed, in both cases there was no mortgage secured on the property at purchase and no adverse finding was made in relation to this. It therefore appears that the Commissioner's approach is inconsistent with the approach of her predecessor, which in turn would also mean that a different standard was being applied to me from that which has always been applied in the past.

3.  The provisions of the Green Book were of course carefully considered and thoroughly applied by Sir Thomas Legg, including the specific issue of mortgage interest claims. Sir Thomas's extensive work involved closely analysing the provisions in the Green Book, forming an independent view as to how they ought to be interpreted and then applying them to the claims made by each Member. The Legg enquiry did not consider that such a point was sustainable otherwise it would have necessarily formed part of its work. If he had interpreted the rules in the way the Commissioner suggests he would have had to write to every Member, and former Member, whoever claimed mortgage interest, seeking details of the initial loan secured on the property. He did not do that and did not suggest that remortgages before becoming an MP were relevant.

4.  In practical terms, the rule would cause ridiculous and anomalous results, which would also be socially divisive. For example, a person who had purchased a run-down house for £100,000 and improved it at a cost of £200,000 obtained by remortgaging would have a total mortgage cost of £300,000. A wealthier person might just buy the same level of house already developed for £500,000. When the two people subsequently became MPs, the former would be able to claim interest on only £100,000 while the latter could make a claim on interest on £500,000. Equally, the person with the £300,000 house could sell on becoming an MP and buy a much more expensive house and claim all the interest but if she made the decision not to do so would have to be limited to the original £100,000. That is an absurd and entirely unnecessary approach to the rules. The Commissioner's approach is also retroactive since it is not an approach that has ever been applied to anyone else or at any time previously.

32. In the light of all of these matters, I would urge the Committee not to form a view that is inconsistent and contrary to that of the Legg Inquiry but to find that the interpretation advanced by the Commissioner is not correct and it is not reasonable to suggest that this contention should have been apparent to me or any other Member at the relevant time. Accordingly, there can be no adverse findings in relation to this third, new, aspect on any view.

33. In addition to the above, there is another important point to emphasise here. The Commissioner's approach is that I should have designated London as my main home and claimed expenses on my constituency home. She also concludes in paragraph 145 that if I had designated in this way as she suggests, then all of my claims would be fully allowable and I was fully entitled to make the claims I made. Given this and given that it must be obvious that I sought to abide by the rules entirely honestly and without seeking to obtain any financial advantageeven the Commissioner accepts elsewhere that I sought to do what was fair and reasonable throughoutit cannot conceivably be a fair or just approach to suggest that I claimed other than correctly in accordance with the system and rules in place at the time and as understood at that time and at all times (until the Commissioner's new approach).

34. Because of the approach of principle I have set out above, I have not addressed in this letter the various purported tables of figures that the Commissioner has put together in the Memorandum but never previously shown to me. As explained above, I do not believe these figures arise for consideration. If they were to do so, there are a number of further errors and inaccuracies that it would be important to raise. Indeed, there are a number of further factual and other concerns I have about the Memorandum. Having set out the facts and matters above, I am not setting all these further concerns out at this stage before the Committee has had the opportunity to consider the above. I would, however, wish finally to deal with one particular factual matter. In the penultimate paragraph of the Memorandum, the Commissioner seeks to draw an adverse inference from her view that I "abruptly ceased to claim" in April 2009. Whilst I did provide an explanation to the Commissioner for this it may assist if I provide an explanation directly to the Committee.

35. Those Members of the Committee elected before 2010 will need little reminding as to what it was like when the expenses scandal broke. I, in common with many Members, was particularly concerned about the impact on my immediate family. One strand of the scandal was the suggestion that Members who had constituencies close to London, such as Basingstoke, did not need to claim an accommodation allowance as they could commute. Strong feelings were expressed both in the local media and to me directly. At the time I formed the view that the right thing for my family and particularly my young children was to cease claiming. I nonetheless continued to maintain two homes at my own expense as it was the only way I could continue to carry out my duties as a mother and Member of Parliament.

36. I have sought at all times to be fair and reasonable in relation to my claims. I had absolutely no reason to act contrary to the rules. I have never sought to gain any financial advantage from the ACA.

37. I hope this letter is of assistance to the Committee. If any further information from me would be helpful, I will of course provide all the assistance I can.

3 February 2014

Letter from the Parliamentary Commissioner for Standards to the Clerk of the Committee responding to Mrs Miller's letter of 3 February 2014

I am grateful to the Committee for the opportunity to respond to Mrs Miller's letter of 3 February 2014.For ease of reference I have reformatted Mrs Miller's letter to add paragraph numbers but have made no other changes. I have not responded to every detail.

Mrs Miller's letter seeks to apply legal principles and arguments to a process of the House which was set up to investigate complaints. The role of the Commissioner is to act as an independent investigator, who is able to establish the facts, interpret the Rules and present a balanced and fair report on the relevant issues to the Committee. My Memorandum providesmy conclusions on whether the rules of the House have been breached so that the Committee can reach its own view and if necessary recommend a sanction to the House. This process must be fair to the parties involved and use procedures which are clear and transparent,but it is not a legal process.

The Procedure for Inquiries says,

1. "Members will be informed about allegations against them when the Commissioner has decided there is sufficient evidence to justify initiating an inquiry. The Commissioner will write to the Member concerned. In this letter the Commissioner will: tell the Member the nature of the allegation; set out the relevant rules of the House; provide the Member with the evidence supporting that allegation; and ask the Member for their response. What is asked of the Member is to give a full and truthful account of the matters which have given rise to the allegation.

2. In the course of the inquiry the Commissioner may ask the Member follow-up questions, seek evidence from any witnesses, including any identified by the Member, and consult authorities such as the relevant Department of the House of Commons, or the Registrar of Members' Financial Interests. The Commissioner may interview the Member in the course of the inquiry, and will always see or speak to the Member if the Member so requests."

Introductory remarks

Paragraph 5

Mrs Miller refers to paragraph 118 of the Memorandum in which I say "many of her responses to my questions have been very general and required repeated probing. This has added considerably to the length of my inquiry." She says "I have responded to letters from the Commissioner on 14 occasions…many of these letters have been very detailed and lengthy, providing financial information going back more than 8 years".Mrs Miller's first four letters to me (3 Jan, 18 Feb, 10 April, 9 May) do contain a great deal of information and her fifth (4 June) contains some, but the remaining nine letters, beginning with the letter of 1 July in which she says she has taken "independent legal advice" are increasingly procedural, and though many of them are lengthy and detailed, they contain little in the way of precise information. They consist more of arguments as to why this information should not be sought.

The following is a brief example of a "very general" answer to a specific question:

Question (19 March):

    "Finally, it appears from the statement from the Coventry, dated 31 May 2008, that you increased your mortgage when you remortgaged with the Coventry on 14 November 2007. Please could you tell me why you did this?"

Answer (10 April):

    "The mortgage changed in the normal course of events."

Paragraph 5(i)

Mrs Miller implies that I have criticised her because documents are not available. This relates to paragraph 117 of my Memorandum, where I say,"Throughout my inquiry it has been difficult to establish information and evidence to the standard of proof which I would have wished. This is in part because of the length of time since some of the relevant events took place. There is also a lack of supporting evidence." In recognition of this, and the operation of the Department's disposal policy, I have made no finding in relation to the absence of the required documentation from the files of the Department of Resources: full mortgage interest statements for 2007-08 and 2008-09; forms reporting Mrs Miller's change of main home; or records of her conversations with staff about the designation of her home.

Paragraph 5 (ii)

Mrs Miller says "it is not quite accurate to say that there is no [corroborating] evidence of my stays in the constituency". She says that two constituency chairman wrote to me"confirming that that is where [she]lived".

This is a reference to paragraph 118 in which I say "despite sustained efforts I have not been able to find evidence to support the information she has given me about the number of nights she spent at each of her properties." One chairmansaid"She was always in Basingstoke on a Friday for her surgery meetings. I was not at home during the week, but... I would see her most weekends at her home...."The other chairman said, "[she] was (and is) in the Constituency on almost every Friday and weekend on Constituency business."This does not amount to "evidence to support the information she has given me about the number of nights spent at each of her properties."

I note from earlier memoranda considered by the Committee that when an inquiry concerned a dispute about the pattern of use of a Member's home, my predecessor sought independent evidence of this. Many families who live in an area over a period of years know at least one or two people who would be aware of the general pattern of their coming and goingbut Mrs Miller has not been able to provide any contact independent of the family who might give even a general sense of this. I find this unusual.The suggestion that she might regularly walk the dog on certain days and meet others doing the same was intended only as an example of the sort of verification which would help to establish her movements.

Paragraph 5 (iv)

Mrs Miller comments that I "maintained the inquiry for several further months" after the Director-General's letter of 27 September 2013.

My practice is to collect and collate the evidence needed before completing the analysis and coming to conclusions in order to avoid prejudging issues. This is what I did. On 10 October I said I thought I had the necessary evidence. In undertaking the analysis I discovered that I had not received all the information requested about her mortgage. Until it was received I could not say how relevant it was.My letters were intended to keep Mrs Miller informed of the progress of the investigation.

Was Mrs Miller's designation of her main and second homes correct?

Paragraph 6

Mrs Miller disputes my conclusion about the designation of her main and second homes.In her letter she misinterprets paragraph 126 of my Memorandum; it is not the designation of her home but "my conclusion" that is finely balanced.

Mrs Miller says that my conclusion that her London home was her main home is incorrect because

i)  It applies the wrong test

ii)  It considers the wrong factors and indulges in speculation

iii)  It overlooks the actual evidence.

I consider each of these allegations in turn.

The wrong test

I do not accept any of these points. I refer the Committee to paragraph 121 of the Memorandum and to the reports concerning Jacqui Smith and Ed Balls & Yvette Coopersummarised in paragraphs 12-18.

Paragraph 7

Mrs Miller says "In paragraph 121, the memorandum argues that the question of nights 'only became relevant' if the location of the main home was not a matter of fact. This is a misapprehension." This is however the approach followed by my predecessor in earlier cases and one which the Committee on Standards and Privileges did not dispute. For example, in his Memorandum on his inquiry into Ed Balls & Yvette Cooper[168], my predecessor said in (paragraph 82)

    "The rules provide that when the location of the main home is not a simple matter of fact (because the Member has more than one home) the objective test is that it is normally the one where they spend more nights than any other."[my emphasis]

In the same report he also says

    "if you have more than one home, your main home will normally be the one where you spend more nights than any other—as long as this is not a rigid rule…that seems to me to be an acceptable guide."

The Committee agreed.

Mrs Miller relies heavily on the Director-General's advice. He said"In her letter to you of 18 February 2013, Mrs Miller provides information that indicates that around two-thirds of her time was spent at her nominated main home in Basingstoke. In addition to this, she states in her letter of 9 May 2013 that two of her children moved their schooling to Hampshire in the period after she was elected and that weekends and recesses were predominantly spent at the constituency home. This would have been sufficient information to allow my Department to agree that it was correct for Mrs Miller to nominate her Hampshire property as her main home, with the consequence that her London property was her second home for ACA purposes. I agree, therefore, that the designation of the homes was correct."

At this juncture however the Department has an incomplete record of the information available to it in the past, and no record of the exact advice which was given. The Director-General's advice is, as he says, "inevitably hypothetical". It is based on the information which was available to him in 2013.

My investigation has brought to light further facts which have led me to a different view. For example, Mrs Miller cited in her letters of 9 May and 4 June, and in the Report of 1 July, that two of her children went to school "in Hampshire" as evidence that Basingstoke was her main home. She omits to mention that both children went to boarding schoolsa circumstance that greatly reduces the relevance of the place of schooling to the location of the family home.

The wrong factors

Paragraphs 8 and 9

Mrs Miller takes issue with my conclusion that her main home was her London property, and that her Basingstoke homes should have been designated as her second home for the purpose of her allowances. I came to this conclusion on the basis of the overall picture presented by Mrs Miller's evidence. I noted that in 2005 her Basingstoke home was not a permanent base for her and her family; that the rental agreement for the first propertyhad already expired and that she was to move three times in the period from May 2005 to April 2009; that each of the Basingstoke homes had fewer bedrooms than her five bedroomed London home; thatbefore she first rented a home in Basingstoke in 2003, Mrs Miller's home was in London, in the five bedroomed house which she and her husband had bought with a mortgage in 1996, to which she had welcomed her parents and brothers; and which had been repaired and improved over the years and that this was again designated as her main home under the IPSA scheme from 2010 onwards.I noted that London was also where her husband worked and where each of her children in turn started school.In my view all these factors pointed towards the London property being Mrs Miller's main home as the term is normally understood. Mrs Miller has not refuted this overall picture.

It is important to remember the purpose for which the ACA was set up, which was "to reimburse Members of Parliament for expenses, wholly, exclusively and necessarily incurred when staying overnight away from their main UK residence ... for the purpose of performing Parliamentary duties...". Mrs Miller argues that one of her homes had to be designated as her main home and this had nothing to do with whether it was originally established exclusively and necessarily for her parliamentary duties. I agree with her that the purpose for which a home was set up may not always be relevant. However, it was against the rules to claim for the costs incurred on what was at the time a Member's main home.

The actual evidence

Paragraph 9

Mrs Miller says that I have "disregarded the actual evidence" on the issue of the designation of her home. I have Mrs Miller's accounts of where she spent her time, and of her wish to make Basingstoke the centre of family life, but there is little independent evidence. The only other direct pieces of evidence are letters from Mrs Miller's constituency chairmen (which do not go to the question of where Mrs Miller spent the majority of her nights) and the household bills which she submitted to the Fees Office in 2008-09.I have already commented at paragraph 125 that Mrs Miller's utility bills and invoices for 2008-09 do not support the idea of a house that was (except for the month of September and occasional other times) unused during the 19 to 20 weeks of Parliamentary recess each year, and from Friday to Sunday evenings during sitting periods. For example, her electricity bills submitted to the Fees Office and published online showed a usage of 1466 kWh in 39 days from October to November 2008, and 6509 kWh in three months from 15 November 2008 to 16 February 2009.

Mrs Miller appears now to be suggesting (in paragraph 10) that her older children were never, or very rarely, at the London home.

It is of course for the Committee to decide on this issue but I remain of the opinion that on the balance of probabilities Mrs Miller should have designated her London house as her main home.

Paragraph 13

Mrs Miller says "I would also emphasize that the Commissioner has correctly found that if I had designated the London house as my main home and made ACA claims on the Basingstoke house, I would have been entitled to make the same claims as I made and there was no financial advantage to me or additional cost to the public purse from the designation." This is not accurate. In paragraph 126 of my Memorandum I said "I have received no evidence that Mrs Miller designated her main home other than in good faith, or that she was motivated by financial gain. Mrs Miller has informed me, and I accept, that the costs of the Basingstoke properties, had she designated them as her second homes, would also have been above the ACA limits." I have no evidence to the contrary.

Did Mrs Miller or her parents receive an immediate financial benefit from public funds by living in her designated second home, and if so, did Mrs Miller reflect this in her claim?

Paragraph 14

I do not agree that this was the only actual complaint made by Mr Mann but will return to this issue in my response to paragraph 23.

Paragraph 15

Mrs Miller says I concluded "[Mrs Miller] acted properly in this regard....and that [her]expenses claimed were correct and appropriate."and that the Director-General of HR and Change "concluded that there was no inappropriate use of public money in this case". These statements are both inaccurate. The Director-General's letter of 27 September 2013 expresses no such view.

It has been recognised that it could be appropriate for family members to live with a Member in that Member's second home. However, as I say in paragraph 133 of my Memorandum"Should arrangements such as this be made to accommodate members of the extended family, it was important that they were discussed very specifically with the Fees Office and that clear financial procedures were in place to ensure that claims were appropriately reduced and that the Fees Office were aware of this."Mrs Miller did not do this and this was not acceptable.The Director-General helpfully suggested the advice his Department might have offered to the Advisory Panel on Members' Allowances, and what he would have regarded as an "equitable outcome" which was "inevitably hypothetical"; a basis on which a formal arrangement for abatement could have been made (paragraph 134). Heconcludes that because Mrs Miller's household costs were significantly above what she could claim, the abatement could be considered as having come from the excess portion of the expenditure.

However, he was not aware of my concerns that Mrs Miller might have over-claimed in respect of her mortgage interest. Much of my concern throughout this inquiry has been about the lack of transparency in Mrs Miller's arrangements and communications and her misinterpretation of my Memorandum in this and other paragraphsprovidesan example. What is beyond dispute is that Mrs Miller claimed allowances which were at or almost at the maximum across the period in question. She was not permitted to claim any more.

Paragraph 19

Mrs Miller says she would have been happy to have a formally documented agreement for the abatement of her claims but was not advised that one was needed. However, in the paper attached to her first letter to me[169]Mrs Miller justifies her position saying, "The remaining question is therefore the meaning of the statement that "living costs for anyone other than yourself'"are not allowable. The word "yourself" cannot mean the MP alone as MPs could and did claim for accommodation which allowed them to claim accommodation costs in relation to their family. Indeed, any other interpretation would be contrary to the public interest in enabling a diverse parliament as recognised by IPSA in its consultation paper. My circumstances are simply that my family includes my parents for whom I have caring responsibilities.

However, I note that in paragraph 86 of Mr Lyon's report in relation to Mr McNulty he stated as follows:

    Itmight be argued that the rules I have identified should not apply to parents who are dependent on a Member. After all, a Member's partner and a Member's children are able to share the home for which a Member claims the Additional Cost Allowance. But the relationship between an adult and their dependent child, and between them and a dependent adult relative, is not the same, important though those responsibilities are. It does not, in my judgment, carry with it an expectation that dependent parents should be able to share a property funded in whole or in part from public funds without at least the full value of that benefit being reflected in the Member's claims.

This report is dated before the IPSA consultation paper that I have quoted from above. Mr Lyon was quite rightly seeking to draw a line where the use of the word 'yourself' in the rules does not have its natural and ordinary meaning, as it must include the MP's family. His views were expressed in the context of an entirely different arrangement and based upon whether there is a distinction between dependent children and financially dependent adults. Mr Lyon was clearly not addressing the facts that relate to my situation and of course he did not have the benefit of the IPSA consultation paper when he wrote his report in relation to Mr McNulty. This is no criticism of Mr Lyon as Mr McNulty's circumstances were radically different and did not raise the same issues.

I would suggest that the rules at the time did permit the use of the ACA for members of the MP's family beyond spouse and dependent children, in appropriate but limited circumstances. These circumstances would include my position where I had an established family life with my parents for whom I had carer responsibilities. This is entirely consistent with the views expressed by IPSA in their consultation paper as to where the public interest lies and also is consistent with the rules not inhibiting family life. It is also consistent with the advice I received from the house authorities at the time."

Mrs Miller has developed her own rationale for her position despite clear guidance to the contrary and misunderstands the purpose of the ACA"to reimburse Members of Parliament for expenses, wholly, exclusively and necessarily incurred when staying overnight away from their main UK residence ... for the purpose of performing Parliamentary duties..."There is no evidence that she sought the advice of the House authorities on this specific matter and the Director General's letter suggests that this would have been an unusual matter which would have come to senior attention.

Paragraph 20

Mrs Miller says that it is a "non sequitur" that "because in [my] view there was a lack of formality in [her] arrangements, there was an inappropriate use of public money."I agree that this last sentence of paragraph 153 could have been better worded. I should have said "the lack of abatement resulted in an inappropriate use of public money". I am happy to revise this wording.

Were Mrs Miller's ACA claims made in accordance with the rules and guidance of the relevant period?

Paragraphs 21and 22

Mrs Miller addresses this section of my Memorandum, which concerns whether her claims (in particular for mortgage interest)were within the rules. She says that it "entirely duplicates the inquiry undertaken by Sir Thomas Legg in 2010", and implies that I had no remit to inquire into whether her claims were in accordance with the rules of the House.She disputes my reliance on the Committee's decision in the Mackay/Kirkbride case. However, Mrs Miller misquotes the Committee when she says that they considered that the question considered by the Legg Inquiry had been "settled". The Committee said,"We regard the question of repayment as having been settled by Sir Thomas Legg." (my emphasis).

My remit (see page 1 of this letter) is different from that of the Legg Inquiry, which was "to determine the validity of payments of the Additional Costs Allowance (ACA) made to Members of Parliament during the period April 2004 to March 2009, andtorecommend any repayments which MPs should make."[170]I can find no precedent to suggest that the Commissioner cannot inquire into a matter already considered by Sir Thomas, or is bound by his decisions. I note that after the conclusion and publication of the Report of the Legg Inquiry in February 2010 my predecessor inquired into specific claims against the Additional Costs Allowance by Members. In some cases, (for example his inquiries into allegations against Shahid Malik and Anthony Wright) he came to the conclusion that certain claims not identified by the Legg Inquiry were in contravention of the rules at the time, and these were repaid.

Paragraph 23

I have already responded to Mrs Miller's assertion that the questions I raised about her claims for mortgage interest were not part of the scope of the inquiry (paragraph 111 of the Memorandum). Mrs Miller says "It was raised late in the day, after the Commissioner had told me in her 10 October 2013 letter... that she had concluded the inquiry."Without repeating that, Mr Mann's letter clearly expresses his concern about her claims for mortgage interest as does the Telegraph article. My predecessor sent both of these to Mrs Miller with his first letter.I agree that his paragraph stating

    "In essence, the complaint is that you claimed against your additional costs allowance and personal additional accommodation expenditure from May 2005 to April 2009 for the costs of your overnight stays away from your main home in a property in which your parents lived, which provided them with an immediate benefit and which did not take full account of their living costs, contrary to the rules of the House."

is less specific, but the rules which he goes on to cite clearly include mortgage and other costs. If he did not intend to look at this issue he would have indicated this both to Mrs Miller and to Mr Mann at the outset of the inquiry. The Committee has recently considered my Memorandum concerning the inquiry into Simon Hughes, started by my predecessor approximately a month before this matter. It provides a contemporaneous example of his practice of specifying the heads of complaint into which he would not inquire.

Paragraph 24, third bullet point

This refers to Mrs Miller's comments on my draft report when she was invited to ensure that it was factually correct. Mrs Miller asked me to include at paragraph 3 the paragraph from my predecessor's opening letter to her in which he explained the essence of the complaint he was inquiring into. In fairness to her I accepted many of her suggested amendments which were not strictly factual. However, I did not consider that this paragraph should be separated from quotations of the Code of Conduct or that it fitted at that point in my Memorandum.

Fourth bullet point

Mrs Miller says that I had included in my Memorandum a number of provisions from the Green Book which had not previously been mentioned in my inquiry. This matter is addressed fully in WE48 and 49.I had added to my draft report two bullet points from the Green Book rules which do not appear in my predecessor's letter. Mrs Miller appears to be arguing that once his original letter had been sent out, the precise rules he had identified as being relevant could not then be changed in anyway.This cannot be the case. During the course of an investigation many issues may come to light and will need to be considered alongside the original complaint. The complainant, according to the Procedural Note, is required to give sufficient evidence to justify an inquiry, but no more. He cannot be expected to know all the detail of the area that concerns him and that is for the investigation to discover. If further evidence emerges, another rule, or in this case additional bullet points included in a rule already identified, may become relevant.In this case the mortgage issues were not new matters but part of the original complaint. I do not consider that my Memorandum must mirror exactly the original letter. It would of course be a different matter if I had suddenly introduced entirely new issues which bore no relation to the original complaint, but I have not done so.

With reference to her fifth and sixth bullet points, in accordance with the Procedural Note Mrs Miller was informed of the allegations against her, the relevant rules were set out and she was provided with the evidence to support the allegation (paragraph 2 of the Procedural Note). Mr Mann's letter makes the issues clear and as I have already said, the Commissioner did not exclude anything.I do not think Mrs Miller could have been in any doubt about the issues or that they included the mortgage; particularly as the Commissioner went on to ask specific questions about the mortgage arrangements in his letter.

The 2007 £50,000 increase

Paragraph 26

(i) Mrs Miller says "the Commissioner's new allegation here was not raised with me during the course of her extensive inquiry..." In fact I have repeatedly asked Mrs Miller for information about the additional mortgage in letters of 19 March, 25 April and 23 October 2013. It is not correct to say that she was not aware of the issue, and when the difficulty in making an appointment became apparent, I wrote to her. Mrs Miller has not been prepared to share any information about this with me. It is important not to make any assumptions about the use to which any of the additional mortgage amounts may have been put.

In relation to the £50,000 increase to her mortgage, Mrs Miller says "At no stage did my claim for mortgage interest exceed the amount of the mortgage when I entered Parliament." In fact Mrs Miller's claims for mortgage interest increased in each year until 2008-09. In 2005-06 they were £15,829; in 2006-07, £17,268; in 2007-08, £17,788; and in 2008-09, £19,264.63.

Full mortgage interest statements are not available for the period from November 2007 to April 2009, which is the period for which Mrs Miller maintained an increased mortgage of something over £576,000. But I accept, as I said in my conclusions, that (bearing in mind the offset) she did not claim the full amount of interest she paid on the extended loan. During the period November 2007 to March 2008, mortgage interest statements show that Mrs Miller paid £10,991.57 in mortgage interest (to which were added the creditsmade by her lender to reflect the interest she received on another account), and claimed £7,335 from her allowances. For the year 2008-09 mortgage interest statements are incomplete, but Mrs Miller says that her mortgage costs were £21,530.She claimed £19,264.63.

However, if the months are considered separately, the picture is different. In some months it is clear from the available statements that Mrs Miller did claim for the full amount of her mortgage interest on the extended loan. In each month from January to March 2009, Mrs Miller was reimbursed for a sum which was close to, or the same as,the full amount of the mortgage interest she paid; a total of £1,894.71. Over the same period the sum she paid (which includes both her own interest payments and the offset credit from another account) was £1,896.26. In April 2009 she claimed £164.68, which is the sum she paid before the offset credit was added. (The statement does not show the offset credit for that month.)

(ii)Mrs Miller says that the claims for interest on an extended mortgage were considered by Sir Thomas Legg who found "no issues". I am unable to say why he found no issues. I am aware of nine cases where Members had extended mortgages, or established additional mortgages, between 2004 and 2008, and where he took aview on whether the Members were properly able to claim for the additional interest incurred.

(iv) Mrs Miller implies that I allege that she claimed interest on the £50,000 increase in 2007. She has misunderstood this paragraph, which refers to increases to the mortgage in the years before she became a Member. (See my comments on paragraph 26, where I explain that I accept that she did not claim the full interest on the 2007 increase.). When the rules were changed to allow mortgage increases to pay for repairs or improvements, these could not have included repairs or improvements before the Member entered the House. My interpretation is borne out by the Committee's decision in the case of Mr George Osborne.

(v) Mrs Miller says that my reference to "beyond reasonable doubt" was a misunderstanding. She says "This is not the standard of proof that the Commissioner is required to apply". But the Procedural Note is clear at paragraph 39:

    "When considering allegations against Members, the Commissioner and the Committee normally require allegations to be proved on the balance of probabilities, namely, that they are more likely than not to be true. Where the Commissioner and the Committee deem the allegations to be sufficiently serious, a higher standard of proof will be applied, namely, thatthe allegations are significantly more likely than not to be true."

My Mortgage before I became an MP

Paragraph 29

Mrs Miller disagrees with my understanding of the rule in the 2005 Green Book which says that Members may claim mortgage costs limited to

    "the interest paid on repayment or endowment mortgages, legal and other costs associated with obtaining (and selling) that home..."

It is a list, separated appropriately by a comma between the first and second items and "and" before the final item and all of the items are "associated with obtaining (and selling) that home".

In contrast the word "and" is crucial to the sense of the 2003Green Book by separating the sentence into two parts. The effect is that it says mortgage costs limited to

    "[the interest paid on repayment or endowment mortgages] and [other costs associated with obtaining (and selling) that home]"(My emphasis)

It is the comma that is redundant here.

If we consider the context, we have a situation in which the rules of 2003 are tightened in 2005, but then in 2006 there appears to have been concern that the change has had too harsh an effect.The rule itself does not change but additional provision is made in 3.13.1to allow for interest on mortgages to improve a property to be paid provided that Members consult the House before making any commitments. This was not permitted in 2005.

I therefore maintain that my interpretation of the 2005 rules is the correct one and thatit did apply to the interest on mortgages taken out before the Member entered the House.Nor can any Member anticipate the change of rules in 2006 before they happened.

Paragraph 31

1. Mrs Miller says that she suggested on 17 January that I should seek advice on this issue from the Director-General of HR and Change. This is not correct.With respect to her argument that I should not be considering her mortgage at all and referring to my letter of 12 September, she says, "If your enquiry was wider in scope it would have been appropriate to raise these wider issues with the Director-General."

2. Mrs Miller says that she is not aware of any complaints or investigations which concerned mortgages or advances secured on the same property which were over and above the original mortgage to purchase that property. She says that the cases involving George Osborne and Alan Duncan are not relevant because the additional borrowing was taken out by the Members after they were elected.This is not accurate in the case of Mr Osborne. The circumstances were complicated, but his initial loan of £470,000 covered not only the £445,000 purchase costs of the property which he bought in 2000, but also transaction costs and initial repairs.

Paragraph 33

Mrs Miller suggests that I have said in paragraph 145that if she had designated London as her main home "all of my claims would be fully allowable and I was fully entitled to make the claims I made". This is a misrepresentation of my argument. In connection with the rough calculations I have made I said,"The table below shows that if she had designated her constituency homes as her second homes from May 2005 to March 2009 and if she had reduced her claims by 2/7 to take account of her parents' presence in the household, she could have claimed around £54,000 for rent over the period. I have not been able to establish the other costs associated with these properties, but I consider it likely that if Mrs Miller had claimed for these, also reduced by 2/7, her claims would have been at or around the ceiling of the relevant allowance from May2005 to March 2009."

Paragraph 34

I note Mrs Miller's explanation of why she ceased to claim in 2009. She objects to my use of the words "abruptly ceased to claim".Mrs Miller claimed ACA/PAAE at or near the maximum for every month over nearly four years. She then made a very small claim for April 2009, and thereafter no claim at all. That is what I meant by "abruptly ceased to claim".

Mrs Miller refers to "further errors and inaccuracies" in the tables of figures in my conclusions. It is correct that some of the figures in the conclusion will be unfamiliar to Mrs Miller. They form part of my analysis which was not shared with her in draft. My calculations are based on figures supplied by Mrs Miller either directly to me or indirectly via the statements given to the Fees Office. The only figures from another source are the council tax figures for the years from 2005-06 to 2007-08 which Mrs Miller said she was unable to obtain. (My office found these available online.) The table in paragraph 134 compares her claims to the total ACA allowances and the figures will be familiar. The later tables consider reductions of two-sevenths as suggested by the Director-General in respect of her parents' living costs.I have made it clear that I have insufficient information to be precise and that these are very rough estimates only.

On re-examination I believe there is an error in the table included in paragraph 142, for which I apologise. I have used incorrect figures in the second line which in turn have led to a final figure approximately £9,000 higher than it should have been. I ask the Committee to accept my sincere apology for this mistake and for permission to correct the figures before the Memorandum is published. Paragraphs 147 and 155 are also affected and the over-claim figure should be approximately £44,000 rather than £51,000. I have attached the revised section as an appendix to this letter[171].

Conclusion

The Committee has also asked me whether there have been any particular difficulties which have arisen in this inquiry. While there are always issues that arise when an inquiry is begun by one person and then taken on by another, I have already addressed the particular concern about the scope of the inquiry. Looking at the written evidence it can be seen that there were few gaps in responses to letters on either side.The only significant delay occurred between July, when Mrs Miller sent her first legal document, and September. She did not want me to take the advice of the Director-General on the basis of the summary of the statement of facts I had prepared and thought instead I should conclude my investigation.The number of letters exchanged was a concern to me and early in the inquirywas necessitated by the vague or imprecise answers to questions, which I have already mentioned. Much time was spent looking for evidence to support Mrs Miller's case. Towards the end of the inquiry responding to Mrs Miller's increasingly procedural letters took more and more time and delayed the conclusion of my work.

This letter responds at some length to most of the misrepresentations of my inquiry and my Memorandum by which Mrs Miller has attempted to discredit both the Memorandum and myself. I remain of the view that my inquiry and the Memorandum are robust and that the conclusions are sound. I remain, of course, happy to assist the Committee further.

13 February 2014


168   CommitteeonStandardsandPrivileges,FourteenthReportofSession2007-08,HC1044 Back

169   WE5 Back

170   Appendix1ACAReview:ReportbySirThomasLegg Back

171   TheinformationprovidedinthisappendixhasnowbeenincorporatedintotheCommissioner'smemorandum.See Appendix 1 Back


 
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