Page last updated at 21:33 GMT, Tuesday, 25 May 2010 22:33 UK

Expenses watchdog to up financial help for MPs amid row

Houses of Parliament
MPs are already concerned about how the new system will work

MPs are to be offered cash advances of £4,000 to cover office and travel costs after many criticised new rules set by Parliament's new expenses watchdog.

IPSA, set up in the wake of the expenses scandal, has faced a backlash from some MPs claiming the new rules are overly complicated and draconian.

As well as offering more money upfront, the watchdog has changed the rules on reimbursing members for phone calls.

IPSA chairman Sir Ian Kennedy said it had listened to MPs' feedback.

New rules governing MPs' expenses - drawn up after an independent inquiry into the whole system - came into force with the start of the new Parliamentary session.

The Independent Parliamentary Standards Authority (IPSA) has said it will pay salaries for the first time this month and will pay the first expenses on a weekly basis in June.


But MPs are concerned there is not enough money available for set-up costs in the first few months.

Others have been arguing the £110,000 annual staffing budget is too tight as MPs are now being asked to pay pensions contributions personally rather than out of a central fund and this could result in staff being laid off.

Labour MP Jim Sheridan described the system last week as "cumbersome" and even "vindictive", arguing it penalised MPs without other sources of income and those not living in London.

He said there was a "lot of anger" among MPs from all parties about the changes and members were not being given enough time to adjust their budgets.

IPSA has held meetings with the political parties to try to reassure them about the new rules and has contacted every MP to discuss the new arrangements.

Loans and advances were already available for major outlays such as deposits on flats and offices - especially for the unusually large number of first-time MPs.


But Sir Ian Kennedy said the watchdog had noted MPs did not have sufficient resources to cover bills for office equipment, stationery, transport and hotel accommodation and would provide additional support.

"We have always said we will listen to feedback and, where evidence is provided, make adjustments to assist the implementation of the rules," he said.

"We have looked at the evidence and we are prepared to offer further advances which we will recover later this year."

He also confirmed MPs would be allowed to state which of their phone calls are private and which are political in nature and a proposal to automatically treat 15% of calls as private - and therefore not liable to be reimbursed - would be dropped.

The new expenses rules were unveiled in March following a lengthy consultation process.

Among the biggest changes is the new rule that MPs cannot buy homes and claim back the mortgage interest. Instead they can claim up to £1,450 a month in rent.

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