Page last updated at 18:29 GMT, Wednesday, 20 May 2009 19:29 UK

Expenses reform 'to boost trust'

Michael Martin outlines new rules on MPs expenses

Commons leader Harriet Harman has set out changes to MPs' expenses she says will put Parliament "above reproach".

Moving from self to external regulation was necessary for "reparation and for reassurance" following the outcry over leaked expenses revelations, she said.

Immediate changes, agreed by party leaders, include a £1,250 a month cap on mortgage interest and rent payments.

Others are a ban on "flipping" second homes in 2009/10 and on claiming for furniture, cleaning and stamp duty.

The changes - which are temporary until an independent review of the whole system makes new recommendations in the autumn - were welcomed by the Conservatives and Liberal Democrat leaderships.

'Chaos'

But Tory leader David Cameron, speaking earlier at prime minister's questions, said the only way to end the "paralysis" caused by the expenses scandal was to hold a general election.

In angry exchanges with Prime Minister Gordon Brown, Mr Cameron seized on remarks by Mr Brown in which he said an election would cause "chaos".

"The prime minister calls elections chaos. I call them change. Why can't we have one?," asked Mr Cameron.

Mr Brown said the Conservatives would cause "chaos" with public spending cuts, prompting Mr Cameron to say: "So there we have it - the first admission that you think you are going to lose."

The days of MPs being judge and jury of their own expenses, are over
Nick Clegg, Lib Dem leader

The party leaders agreed to temporary changes which were unveiled by Speaker Michael Martin on Tuesday, after he announced he would be standing down.

Ms Harman told MPs the government would consult on setting up a new Parliamentary Standards Authority, which would be able to disallow claims, order some to be repaid and issue financial penalties. It would also regulate and administer peers' allowances.

But it would not suspend MPs - that would remain an issue for the House of Commons via the standards and privileges committee.

Most MPs were "hard working, decent and honest" but reforms were needed to ensure "Parliamentary democracy is as strong and confident as it can be," she said.

She said while politics was all about "deeply held, different views" there was a "consensus across all parties that we need to put the reputation of Parliament above reproach".

'Quite worried'

Her Conservative shadow Alan Duncan said MPs must embrace the "massive structural shift" of giving up the right to determine their own remuneration - if Parliament was "not to sink further in the eyes of voters".

Liberal Democrat David Heath welcomed plans for external regulation - but said he was concerned the new rules might mean MPs were given a "perverse incentive" to buy, not rent.

Ms Harman said the members estimate committee would consider the matter when it meets later "to work out how we put the very important cap on accommodation expenses into practice".

INTERIM CHANGES
Ban on changing designated second homes for 2009/10
Bills and mortgage/rent claims allowed - furniture claims banned
Married couples to claim only one allowance
All claims to be published online quarterly
Capital gains tax liable on second homes

Some MPs raised concerns about the new rules leaving people worse off and there were questions about who the new standards body would be accountable to.

Tory Brian Binley said some MPs were "really quite worried" that they would be caught out "through no fault of their own".

But Labour's Clive Efford asked how the £1,250 cap on mortgage interest had been arrived at - suggesting it was too high - Ms Harman said the members' estimate committee had looked at the average for all MPs.

Two Labour MPs, Don Touhig and Diane Abbott, stuck up for staff in the Commons Fees Office who many MPs have claimed approved claims which now appear questionable.

'Good job'

Ms Abbott warned against blaming the ordinary staff "on average salaries" for something all MPs had to take responsibility for.

Meanwhile, Tory Anthony Steen has become the latest MP to announce that he will not be a candidate at the next election following allegations that he claimed £87,000 over four years for his country home.

In a statement, he said that he did not want to "distract from the real story" of who would be the best prime minister for the UK and thanked his constituents for their support.

Hazel Blears has insisted she will be carrying on with her job despite Mr Brown's remark that it was "totally unacceptable" that she failed to pay capital gains tax on the sale of the flat she designated her second home for expenses purposes.

Speaking in her Salford constituency, Ms Blears said comments by the prime minister's spokesman that she was doing a "good job" showed that Mr Brown had "full confidence" in her.

The Daily Telegraph has, meanwhile, published further revelations about MPs' expenses claims.

Blears: 'PM thinks I'm doing great job'

MPs targeted include Conservative James Gray, who reportedly claimed £2,000 for the future redecoration of his second home on the day his lease ended - he told the newspaper he had paid for "dilapidation caused by 10 years of occupation".

Labour MP Chris Mullin's claim - for £45 towards the licence fee for his black and white television - is contrasted with some of his colleagues' claims for expensive plasma screen TVs.

Liberal Democrat MP Phil Willis is accused of spending about £15,000 of public money on mortgage interest payments and refurbishing a flat in which his daughter now lives - he said she had never been a "permanent resident".

Labour MP Ian Davidson reportedly paid a family friend £5,500 to renovate his London flat and had reclining furniture worth £1,459 delivered to his constituency home in Glasgow - which he had claimed for the London flat.

He said the furniture was later driven to his London flat and he had sought permission to use the friend for renovations - which he said would have been cheaper than using a London firm.

On Tuesday Mr Martin told MPs he intended to stand down, so becoming the first Commons Speaker to be effectively forced out of office for 300 years.

He had been under pressure after attacking MPs who had criticised his handling of the row and speculation has already switched at Westminster to whom his successor might be.



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