MPs would face a drastic cut in expenses and live in one-bedroom flats, under proposals by the Midlands MP in charge of cleaning up the House of Commons.
Tony Wright (Lab Cannock Chase) wants to end the second home allowance, which allows MPs to claim for the interest on mortgage payments, and to buy furniture, at taxpayers’ expense.
Most of the controversial claims to emerge in recent months, including for moats and duck islands, were made under the second homes allowance, officially known as the Additional Costs Allowance.
Even when MPs use the allowance as intended they are likely to make a profit if they buy a subsidised second home and property prices rise.
Under Dr Wright’s proposals, MPs would instead be allowed to rent a “modest one-bed flat in central London”.
Any MP who wanted more than this would be told to fund the extra cost himself.
And they would be barred from claiming a subsidy on mortgage payments, so that they could not make a profit by selling a subsidised property.
Dr Wright is to chair a new Select Committee on Reform of the House of Commons, which will draw up an expenses system designed to end abuses and restore confidence in Parliament.
He also called for new employment rules to stop MPs employing family members without a proper appointments process. And he said the communications allowance, which allows MPs to claim up to £10,000 a year for publicity material, should be scrapped.
At the moment, MPs can use the allowance to send out an annual brochure to voters, often named “Westminster Report”, extolling hard work done on behalf of constituents.
The reports are supposed to be non-political, as they are funded by the taxpayer, but MPs are frequently accused of using the allowance to produce political propaganda. Dr Wright wants MPs limited to producing a factual annual report setting out voting and attendance record, outside interests and any expenses claims.
He made the proposals in evidence to the Committee on Standards in Public Life, which is carrying out its own inquiry into the expenses scandal.
The MP, who himself rents a one-bedroom flat in London, told the inquiry: “It was a mistake to allow MPs to buy property and have their mortgage interest paid from public funds.”
This has been a source of many of the abuses that have been revealed, as MPs were turned into property speculators and with inevitable temptation to use public money to invest in the value of their property.
“It has also produced massive capital gains. For example, had I bought a flat in central London in 1992 for £150,000 it could now be sold for as much as £400,000.
“This would have given me a huge capital gain, largely funded by the public purse. I do not think this is acceptable to the public, nor should it be.”
Making the expenses system more transparent would increase public confidence to some extent, but it was also important to ensure MPs simply claimed less, he said. “This means a much less generous system than we have now, especially in relation to property, and an end to the concept of a ‘second home’.”
