Background Outline of the current system of MPs’ allowances
3.Allowances for MPs have been set by a series of resolutions approved by the House of Commons over many years. The first allowances schemes related to stationery and travel. The scheme has grown over the years and the matters for which allowances are claimable have similarly expanded.
4.In January 2008, the Review Body on Senior Salaries (“the SSRB”) produced a Review of parliamentary pay, pensions and allowances 2007 (January 2008) Cm 7270-I. That report made a range of recommendations concerning the way in which MPs’ allowances should be paid. The House considered the SSRB report on 24th January 2008, resolving to accept some of the recommendations and referring others to the Members Estimate Committee. The Members Estimate Committee published its report on the review of allowances on 25th June 2008.(1) It described its report as a “root and branch review” driven by the objectives of adequately equipping MPs and “to meet public expectations for clearer audit and transparency”.
5.The House of Commons debated this report on 2nd July 2008, accepting some of the recommendations but not others, and tasked the Advisory Panel on Members’ Allowances with setting out the conclusions of the House of Commons in a revised system of allowances. The Advisory Panel’s work was contained in a January 2009 report of the Members Estimate Committee.(2) On 22nd January 2009, the House resolved that the revised system of allowances should govern all expenditure on MPs’ allowances for claims on or after 1st April 2009 and empowered the Members Estimate Committee to make such modifications to previous House resolutions relating to MPs’ allowances “as are necessary to ensure that they are consistent with the provisions in the Green Book”.(3)
6.Also on 22nd January 2009, the House resolved to accept the arrangements for audit and assurance of MPs’ allowances set out in the report of the Members Estimate Audit Committee to the Members Estimate Committee (contained as annex 3 to the January 2009 report).(4) Amongst other things, the Members Estimate Committee recommended that the current limitation on the scope of the audit by the National Audit Office should be removed. The effect of this is to bring about full scope audit, the same level of audit provided by the National Audit Office for other public sector bodies.
7.The current system of allowances is set out in The Green Book: A guide to Members’ allowances (“the Green Book”). The allowances scheme is designed to ensure MPs are able to work effectively in Parliament and in their constituencies. It provides support for employing staff, servicing MPs’ offices, overnight stays away from home while on Parliamentary duties, communicating with constituents, House stationery and postage, and travel.
8.The Green Book sets out certain principles, derived from the MPs’ Code of Conduct, which MPs are to adhere to when making claims against parliamentary allowances. The principles are as follows.
9.Parliamentary oversight of the Green Book is currently provided by two House of Commons committees: the Members Estimate Committee and the Committee on Members’ Allowances. The Members Estimate Committee has the same membership as the House of Commons Commission, and is chaired by the Speaker of the House of Commons.
10.The functions of the Members Estimate Committee are: to codify and keep under review Commons resolutions and the Green Book; modify those provisions in the interests of clarity, consistency, accountability and effective administration, and conformity with current circumstances; and consider appeals against determinations by the Committee on Members’ Allowances. (See Standing Order No. 152D.)
11.The functions of the Committee on Members’ Allowances are: to advise the Members Estimate Committee on the discharge of its functions; advise the Speaker, the Members Estimate Committee and the Leader of the House on the development of the arrangements concerning MPs’ allowances; approve practice notes on MPs’ allowances; and determine (subject to an appeal to the Members Estimate Committee) the application of the rules in such cases as may be referred to them by Members. (See Standing Order No. 152G.)
12.The scheme set out in the Green Book is administered by the Commons Department of Resources, often referred to as the “Fees Office”. As set out in the Standing Orders, if an MP’s expenses claim is refused by the Fees Office, the MP may appeal to the Committee on Members’ Allowances. The MP may make a further appeal to the Members Estimate Committee.