Most people, perhaps apart from those MPs who seem to be in denial, agree that the present system of expenses for MPs is unacceptable. The rules governing allowances appear capable of being interpreted by MPs and by those who approved payment of allowances in ways that for most of the general public beggar belief! ‘I was only following the rules’ like the far more serious Nuremberg defence of ‘only obeying orders’ has no ethical justification at all. ‘Flipping’ is not only morally repugnant but potentially fraudulent. So abolish MPs’ allowances and make them live on their salaries. This should end the public anger evident since we actually now know about how the whole system has been abused by some less than honourable members.
We do not want to go back to a system when only the wealthy became MPs and it is essential to a vibrant democracy that we encourage the brightest and most committed people to enter Parliament. To do this we have to recognise that MPs should be paid a reasonable salary, that they need to live in London during the parliamentary session if their constituency is a distance from London and that they need to travel to and from their constituencies for constituency business each week. We also need to recognise that there are occasions when their work as MPs involves them in additional expenses.
To achieve change in the existing corrupt system, the solution is to recognise that the MPs’ salaries should have three components. The first component is their salary as an MP currently set around £64,000. Secondly, the question of a living allowance while in London. If you live in Inner or Outer London, this should not be paid. Beyond that, there should be an across the board figure to cover only the cost of accommodation or the state provides accommodation itself and no living allowance is paid. Finally, travel should be based on the cost of second-class rail travel. If MPs want to travel first-class or use other means of transport then they would have to cover any additional cost themselves. What we need here is a reverse of the London allowance with travel bands across the country so that MPs further away from London have a higher travel component. The overall effect of this would be to increase an MP’s overall salary to between £85,000 and £90,000 a year but there would be no second home allowance or expenses for fixtures and fittings and renovations. Finally, the annual increase in MPs’ total salary should be based on the Retail Price Index, so no need for an annual review. This may seem difficult to justify in the midst of recession but it is a perfectly transparent system and would be significant cheaper than the existing system of salary plus allowances. The only additional allowance that I would permit is for additional expenses necessary only for their work as MPs but that this would have to be agreed with the independent auditors in advance and all receipts submitted. This would impose a fiscal control over expenses that currently does not exist. In addition, MPs expenses should be published quarterly as in the Scottish Parliament so that we can see what the additional money is being spent on.
One further way of reducing the cost of the House of Commons would be to reduce the number of MPs. Devolution has made this into a justifiable proposition. While this is particularly the case with Scotland, there is also a strong case for some reduction in Wales and Northern Ireland.