Page last updated at 12:49 GMT, Wednesday, 28 October 2009

MP mortgage claims 'to be banned'

Houses of Parliament
Details of MPs' expenses claims were leaked in May

MPs would be banned from claiming the cost of mortgage interest payments on expenses and from employing relatives, under proposals by an official review.

The BBC understands the inquiry into expenses will say MPs should only claim for rented homes in future but changes will be phased in over five years.

It will also propose MPs living within an hour's journey of London should not be able to claim for a second home.

More than 200 MPs employ relatives and about 415 claim for mortgage payments.

The BBC's deputy political editor James Landale said he had been told the inquiry would also recommend wider cuts to the expenses regime.

No vote?

These include substantial cuts to the resettlement allowance, paid to retiring MPs, scrapping the controversial £10,400 communications allowance and the £25-a-day subsistence allowance and reducing travel costs by MPs within London.

Sir Christopher Kelly's independent committee on standards in public life is due to publish his report on reforms to the discredited system of MPs' expenses on 4 November.

Prime Minister Gordon Brown told MPs it would be announced in a statement to the House on Wednesday and then would be given to the new independent parliamentary standards committee to implement - such a process means the recommendations were unlikely to be put to a vote of MPs.

Earlier Mr Brown's spokesman said all the main parties had committed to accepting the proposals in full, as long as they met three tests of improving transparency, accountability and reduced costs.

But Labour MP Sir Stuart Bell, a member of the Commons Members Estimate Committee which carried out its own review of MPs' expenses last year, said: "I don't think the House would accept any enforced redundancies of present staff."

He also told the BBC he accepted that future claims for mortgage interests should not be allowed but said current mortgage arrangements "cannot be disturbed".

'Not realistic'

MPs will debate the proposals, he said and "have the opportunity if they so wish to amend them, bearing in mind we do accept the public's outrage at these events".

Conservative MP Roger Gale said his wife Suzy has worked for him for 27 years and does "a very good, very hard, very long job", 60 hours a week, and was highly qualified. He said the reported proposals were "not realistic".

"I've heard one comment, which I think is absolutely ludicrous, to the effect that apparently somebody living an hour's train ride from London will not be allowed to have a base in London," he said.

MPs to rent second homes only
Ban on MPs employing family members on Commons payroll
Ban on MPs close to London claiming second home allowance
Allowances for inner London MPs to be reduced
Changes phased in over five years

"I just don't believe that Kelly lives in the real world, I don't think he knows what kind of hours we work or what kind of job we do."

However Labour MP John Mann said Parliament had to accept the recommendations "lock, stock and barrel" if it was to regain its "moral authority" after the damage of recent months.

Fellow Labour MP Stephen Pound said he would be "absolutely amazed" if the ban on mortgage interest claims was not implemented immediately, saying it should be "good enough" for MPs to rent rooms in lodgings or to stay in hotels.

But he said there would be "clear legal ramifications" if MPs were immediately banned from employing relatives: "You cannot just tear up contracts of employment like that."

'Rotten system'

Asked about the reports on Wednesday morning Lib Dem leader Nick Clegg said he looked forward to seeing the report in full and hoped it would recommend a "radical, total overhaul of this rotten system of expenses". His party has long supported an end to mortgage interest claims.

The Unite union's Parliamentary staff branch has invited spouses and other relatives to a special meeting on the day the report is published.

Chairman Dan Whittler said: "Whether it is unfair dismissal or discrimination law we will offer our members whatever protection we can. Family members of MPs staff save the taxpayer money by working many hours in unpaid overtime."

Some MPs have already claims in the face of public anger and others face requests for further repayments after a review of all second home claims since 2004 by Sir Thomas Legg.

Sir Christopher has not commented on the reports, but it is understood he briefed the Conservative and Liberal Democrat leaders along with Cabinet Secretary Sir Gus O'Donnell on Tuesday afternoon.

An independent panel which looked at Welsh Assembly Members' expenses recommended in July that AMs should not be allowed to claim towards mortgage interest and relatives should not be employed - although any existing arrangements would continue.

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