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Last Updated: Friday, 29 June 2007, 08:20 GMT 09:20 UK
The ins and outs of allowances
Jerry Thomas
The Politics Show London

Houses of Parliament
Time for a critical review of pay and allowances...

In this new era of government, politicians are falling over themselves to show greater "transparency" in their actions. With the saying "charity begins at home", there are calls for an independent review of MPs' salaries and allowances...

For the hardworking MP, representing a far flung constituency outside London and sometimes hundreds of miles from the Palace of Westminster, the Additional Costs Allowance (ACA) of 21,634 pounds to fund accommodation in the capital when parliament is sitting, is not so much a perk as a financial necessity.

The issue is especially topical as, this month the new boundaries for English Westminster constituencies were approved by the Privy Council to come into effect at the next general election.

But the necessity of having the same allowance for Outer London constituencies is, at best, a questionable award - at worst, an inappropriate use of public money.

Especially when one considers the definition of what constitutes an Outer London constituency.

Inner or outer...?

What do Shepherds Bush, Tottenham and Leyton all have in common?

Bank notes
Some MPs may end up with fewer notes in the pocket after the review

Aside from hosting professional football clubs, they are all, according to the House of Commons, deemed to be in Outer London.

This might come as a surprise to Londoners in general and specifically to local people.

These areas along with West Ham, Ealing, Acton and Wanstead, are all a relatively short tube ride away from the House of Commons.

Currently, MPs are given the choice between the 21,634 ACA to pay for alternative accommodation to their constituency home or the 2,613 London Supplement, which all of the Capital's MPs are entitled to.


Norman Baker MP
If MPs do choose to buy, they should not stand to profit from the purchase
Norman Baker

Norman Baker, Liberal Democrat MP for Lewes, who claims the ACA to rent a flat off Trafalgar Square himself, feels that it is wrong for MPs to be entitled to use the allowance to buy a property.

"If MPs do choose to buy, they should not stand to profit from the purchase.

"Any profit on sale should go back into the public purse - any loss should be shouldered by the purchaser."

The issue highlights an increasing call for greater transparency and accountability in MPs' dealings.

There are calls for an independent body to address the issue of MPs' pay and whilst there is no suggestion of impropriety, the current system of in-house scrutiny hardly inspires confidence.

The Senior Salaries Review Body is reporting on MPs' salaries and allowances in the next few weeks.

One of the things they will be looking at will be the ACA.

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