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What the Lib Dems say about MP expenses

April 30, 2009

column-picture1Gordon’s premiership is unravelling.

We now hear that the Prime Minister has made a U-turn on his hastily drafted MP expenses proposals.

MPs voted on these issues in Westminster today.

The Prime Minister, earlier in the week, sensing that he would lose the free vote, changed tack, and asked Sir Christopher Kelly (of the anti-sleaze watchdog) to outline an alternative scheme before the summer.

It is of vital importance that we get these changes right, because the system as it stands is doing untold damage to any vestiges of trust and confidence that the electorate retains in our political system.

On Monday, Nick Clegg wrote to Gordon Brown and David Cameron outlining Liberal Democrat proposals for reform of the system.

Within our proposals, I am most pleased to see our commitment to MPs being prevented from making capital gains out of owning second homes.

This is something that Norman Baker – the Lib Dem MP for Lewes – has campaigned on for some time, and I have long supported him.

Here are the key bits of the letter:

‘[These are] the three principles that I believe are essential in the reform of the MPs second home allowance: first, that any reform should be at lower overall cost to the taxpayer; second, that reform must be transparent with money paid in return for evidence of costs genuinely incurred; and, third, that MPs should not be able to profit from the sale of properties they have bought on the back of subsidies from the taxpayer.

‘That is why I have proposed that we should simply stop MPs from buying properties altogether, providing support for rental and associated costs only instead.

‘However, in our discussion on Wednesday, it was clear that both yourself and David Cameron believe that MPs should continue to be able to own second homes for which they claim public support. Given this, I would like to suggest a slight change in my original proposals so that we can reach a consensus as soon as possible.

‘I propose that:

1. Personal additional accommodation expenditure is reduced and is only claimable against basic utility bills, council tax and either rent or mortgage interest on production of the necessary receipt or agreement (all of which should be in the public domain);

2. But MPs should be banned from making any capital gains from that part of a mortgage paid for by the taxpayer (i.e. if it is an interest only mortgage, the taxpayer would get 100% of the capital gain; if it is a capital and interest mortgage, the taxpayer would get the capital gain in proportion to the share of total mortgage costs paid);

3. Personal additional accommodation expenditure should be restricted to members of parliament representing constituencies outside Greater London;

4. There is a mechanism set up for the independent validation of the designation of first and second homes.

‘This would meet your objective of allowing home ownership to continue, but would still meet my key test that MPs should not be able to make profits by using taxpayers money to make investments in the property market rather than simply as a support for the ongoing costs of doing their jobs as MPs.

‘Whilst I’m prepared to make this change to my proposals in order to secure agreement, I should reiterate once again my strong opposition to a system of daily allowances. Such a system – in almost any form – means taxpayers will have almost no idea what their money is being spent on by MPs.

‘Any reforms must be durable, transparent, reduce the cost of our politics and not merely constitute an interim fix that falls apart under public scrutiny.’

These are sensible and honourable proposals.

I hope Sir Christopher will make use of them.

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One Comment
  1. Nick – You do realise that this is the best opportunity your party has of being voted in. I truly believe that those that waste their vote, due to apathy, may be persuaded to ‘go for it’ and sadly i think those people are likely libdem voters, who have previously assumed that libs will never succeed – to be fair, the lib dems aren’t without scandal…..
    back to MP expenses – it is not humane to single out one layer of government. why not start the fight to see Leaders of local government expenses (elections in offing…), starting with East Sussex ? could be interesting, especially as ours is married to an MP and nurtured the ‘Barking Mincer – Battle in Westminster, …’- conceals sexuality to family, conceals alleged fraudulant financial claims from Tax and VAT……. what else?????????/ cheers, alli PS no doubt made his money on cottages and conversions…

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