Revelations by a British national newspaper have thrown the House of Commons into chaos and created a political crisis that is likely to destroy the reputations of many MPs.
The crisis began when The Daily Telegraph began to publish details of MPs’ expenses claims for the last four years. The details – from a stolen data disc paid for by the newspaper – revealed that hundreds of MPs had been abusing the expenses system to claim thousands of pounds to which they were not entitled.
The first article published by the paper concentrated on members of the Government. It revealed that the Prime Minister, Gordon Brown, had paid his brother £6,000 for “cleaning services” at his private flat in Westminster. Mr Brown said they had used the same cleaner and that he simply paid his brother a share of the cost.
The Justice Secretary, Jack Straw, admitted he had over-claimed for both is council tax and for mortgage bills, while Lord Mandelson, the Business Secretary, claimed thousands of pounds to improve his constituency home after he had announced his resignation as an MP. He then sold the property for a profit of £136,000.
Hazel Blears, the Communities Secretary, claimed for three different properties in a single year. She spent almost £5,000 on furniture in three months after buying the third flat in an upmarket area of London.
David Miliband, the Foreign Secretary, spent hundreds of pounds on gardening at his constituency home — leading his gardener to question whether it was necessary to spend the money on pot plants “given [the] relatively short time you’ll be here”.
Northern Ireland Secretary Shaun Woodward, the wealthiest member of the Cabinet, received £100,000 to help pay the mortgage interest on a £1.35 million flat, while the former deputy prime minister, John Prescott, claimed for two lavatory seats in two years and had mock Tudor beams attached to the front of his house.
Most of these claims were made for something called the Additional Costs Allowance (ACA). The ACA is supposed to reimburse MPs for the cost of renting, mortgage interest payments or staying in a hotel in London. In fact, many MPs use it to buy a property in London. Of the 586 MPs who claimed the allowance in 2007, more than half claimed over 90 per cent of the £22,110 maximum. According to the MPs’ rule book, the Green Book: “The ACA reimburses MPs for expenses wholly, exclusively and necessarily incurred when staying overnight away from their main UK residence for the purpose of performing parliamentary duties. This excludes expenses… incurred for… personal or political purposes.”
Under existing rule, MPs can be reimbursed for expenses worth up to £250 without having to provide receipts. They are also allowed to claim for food bills of up to £400 a month and do not have to provide receipts for items under £250. This has allowed MPs to buy an iPod or a fish tank from a supermarket without producing receipts. Many MPs also used the ACA to buy “white goods, electrical equipment and other furnishings”. Some admit they have increased the value of their property with designer kitchens.
In the following days the scandal continued to grow as it became clear MPs had been abusing their powers to claim, in some cases, vast sums of money to which they were not entitled. Many MPs had been claiming the cost of buying apartments in central London when they already had homes nearby. One MP claimed £115 as the cost of changing 25 light bulbs. Another claimed for a new water heating system because he claimed the old one was “too hot”.
One former Conservative minister claimed £9,000 a year for gardening costs. Another claimed more than £125,000 for repairs and maintenance at a London flat owned outright by his partner, where he lives rent-free.
Oliver Letwin claimed more than £2,000 for a leaking pipe to be replaced under his tennis court. Alan Duncan spent thousands from his allowance on gardening, including repairs to his lawnmower. Andrew Lansley spent more than £4,000 of taxpayers’ money renovating his country home months before he sold it. Another claimed for hundreds of sacks of horse manure for his garden. Douglas Hogg charged for the cost of having his moat cleared, his piano tuned and stable lights fixed at his country manor house.
Bob Marshall-Andrews claimed £118,000 for expenses at his second home, including stereo equipment, extensive redecoration and a pair of Kenyan carpets.
Day by day the scandal grew with more and more revelations. The reaction of MPs was at first very defensive. The House of Commons authorities called in the police to investigate who leaked the information to The Daily Telegraph, while MPs blamed officials for allowing their excessive claims to be passed without comment.
By the fourth day, the mood was changing as politicians realised that there was huge public anger at their excessive claims. Opposition leader David Cameron said that any MP in his party who had broken the rules would be sacked. He called the scandal “the biggest political crisis to engulf Westminster for many generations”. A day later he ordered members of his shadow Cabinet to refund excessive claims. A government minister, Hazel Blears, announced she would be repaying £13,000 to the tax authorities for a house she sold at a profit. Phil Hope, the Care Services minister, pledged to pay back more than £41,000 for furniture, fittings and other items claimed on his second home.
Up to this point, MPs had claimed that their excessive claims were not illegal, because they had been accepted by the office in the House of Commons that deals with such matters. However, as the revelations continued, it became clear that some of the claims were illegal and potentially could result in criminal charges of fraud.
It was revealed, for example, that Labour MP Elliot Morley had claimed £16,000 for mortgage payments on a house that had already been paid for. In other words, the mortgage did not even exist. The following day he was suspended from the party. The same thing happened to David Chaytor. On the same day, Andrew Mackay resigned as David Cameron’s aide over “unacceptable” expenses claims and Greg Barker agreed to pay back £10,000 in tax he had not declared properly.
And still the revelations continued. MP James Clappison claimed £100,000 in expenses despite the fact that he owned 24 houses. Husband-and-wife MPs, Sir Nicholas and Anne Winterton claimed more than £80,000 for a London flat owned by a trust controlled by their children. Andrew Mackay and his wife Julie Kirkbride had ‘his and hers’ second homes, while Alan and Ann Keen claimed almost £40,000 a year on a central London flat although their family home was less than 10 miles away.
Labour Cabinet minister Shahid Malik – the first Asian to be elected to the Cabinet – was forced to resign as Justice Minister after insisting he would not pay back any money to the Parliamentary officials for an unusual claim for rent. He claimed £66,000 on his second property while paying less than £100 a week for his main house. Soon after he resigned, Prime Minister Gordon Brown announced an inquiry into his rent payments.
Liz Blackburn went on last-minute shopping sprees before the end of each financial year, in an apparent attempt to make sure she claimed as close to maximum expenses as possible. David Clelland, who tried to block disclosure of MPs’ second-home spending, claimed for the cost of “buying out” his partner’s £45,000 stake in his London flat. Greg Knight, an MP with a collection of classic cars, claimed £2,600 in expenses for repair work on the driveway at his designated second home.
It also became routine for MPs to order goods such as televisions, furniture and household fittings for their house in the capital, but to have them delivered to their homes in their constituencies, sometimes hundreds of miles away.
How had all this come about? How had the “Mother of Parliaments” allowed itself to become a feeding trough for MPs?
Part of the reason goes back to the recession in the 1980s when it became politically unacceptable for MPs to vote themselves pay rises at a time when everyone else in the country was facing cuts in wages. A tacit agreement allowed MPs to claim some expenses as a way of making up for the fact that their salary was worth less than previously. However, this quickly transformed into a system that allowed massive abuses to take place.
Documents produced by The Daily Telegraph show that the Parliamentary office that vets expenses colluded in some of the unusual arrangements being put forward by MPs. It also became clear that the Speaker of the House of Commons, Michael Martin, had approved many of the controversial claims and had attempted to head off attempts to reform the system of allowances. On 19 May, after failing to appease the House of Commons with an apology, he was forced to resign – the first time a Speaker has been forced from office since 1695.
By the end of the second week it was clear that there would have to be some kind of criminal inquiry, in addition to various investigations into ‘dubious’ claims. Sir Paul Stephenson, head of the Metropolitan Police and Britain’s most senior policeman, said he was prepared to begin criminal inquiries into alleged misuse of expenses.
“We will not back down where there is an obvious and clear need to investigate and people can be confident about that,” he said. It is known that last week Sir Paul held talks with Keir Starmer, the director of Public Prosecutions to assess whether criminal inquiries may be necessary. “I do not want to get drawn into party political battles,” he added, “But if there are matters that are brought to my attention that warrant investigation then rest assured we will investigate. We will not back away from our responsibilities.”
The revelations, for which The Daily Telegraph is thought to have paid several hundred thousand pounds, are only the latest to engulf the House of Commons. Last year it emerged that almost 180 MPs from all parties admitted that they employ relatives. They are facing demands to publish how much they pay them following a scandal when it was revealed that a senior Tory MP, Derek Conway, had claimed salaries for his children, even though they had done little or no work for him. He was forced to resign from his post.
Whatever happens now, it is clear that this affair is going to reverberate for the next few months. Already it has claimed some notable scalps, but many more are certain to follow and several promising political careers already lie in ruins. Saddest of all is the extent to which public confidence in politicians has been damaged. That will take years to repair.
*Nick Fielding is a British journalist and a former senior investigative reporter for the Sunday Times.