Page last updated at 20:17 GMT, Thursday, 28 May 2009 21:17 UK

MP to repay 'staff quarters' cash

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Tory MP rejects 'staff quarters' claims

A Tory MP has agreed to repay £20,000 in tax and mortgage payments, much of which was claimed from public funds towards staff quarters in his home.

Sir John Butterfill said he was given incorrect advice about what he could claim for a section of his house, later sold for £1.2m, occupied by a gardener.

He denied avoiding capital gains tax on the 2005 sale of the six-bedroom house.

Lib Dem leader Nick Clegg is calling for MPs' summer breaks to be delayed until Westminster reforms are agreed.

Sir John, who announced last year he would stand down from Parliament at the next election, is the latest MP from his party to be the focus of reports in the Daily Telegraph, which has obtained details of all MPs expenses over a four-year period.

The one mistake I made was that in claiming interest on the home, I didn't separate from that the value of the servants, or the staff, wing
Sir John Butterfill

He told the BBC's Newsnight he had spent nearly £500,000 renovating a virtually "derelict" property in Woking and therefore any capital gain he would have made when selling it in 2005 would have been "minimal".

But he said he was prepared to re-examine the transaction and if he had made a profit, would repay an "appropriate amount".

According to the paper, Sir John designated a six-bedroom property in Woking as his second home and regularly claimed towards the cost of running it from his second home allowance.

At that time, the Bournemouth West MP said his main residence was a smaller flat in his constituency.

But when it came to selling the Woking property, the paper said Sir John informed Revenue and Customs that it was his main residence and therefore not liable for capital gains tax.

Under the rules, MPs can designate different properties as their primary and secondary residences for the purposes of claiming expenses and for capital gain liability.

'One mistake'

However, Sir John admitted he had made an inadvertent error in not "separating out" the cost of claims for mortgage interest and council tax on a new annex he added to the Woking property to accommodate his gardener and his family.

"The one mistake I made was that in claiming interest on the home, I didn't separate from that the value of the servants', or the staff, wing.

"And I claimed the whole of that and the whole of the council tax relating to that," he told Newsnight.

"I cleared that with the fees office at the time. I wasn't told I needed to separate out the part of the house that was being occupied by my gardener and his wife from the whole house.

"I understand now that I should have done that."

Having discussed his claims with the Tories' internal scrutiny panel on expenses, Sir John said he had agreed to repay an estimated £20,000 in claims he said were, with hindsight, "inappropriate".

These would also include £3,000 for work on his Bournemouth flat, he added.

"Bar gates"

The continuing revelations about MP expenses have increased the pressure on party leaders to be seen to act.

Writing in the Guardian, Mr Clegg set out a 100-day action plan to clean up Commons expenses and speed up key constitutional changes.

"Let us bar the gates of Westminster and stop MPs leaving for their summer holidays until this crisis has been sorted out, and every nook and cranny of our political system reformed," he wrote.

Mr Clegg wants to change the electoral system, capping donations to parties, abolishing the House of Lords and making it possible for MPs to be sacked by their constituents.



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