University 18 Yrs + | Parliament
Introduction to Members of Parliament Interests and Expenses
Before the 17th century MPs were paid expenses by the town that sent them, either in money or goods; Great Yarmouth decided to pay their MPs partly in fish.
By the 18th century MPs were local gentry with their own resources and the practice lapsed. Parliamentary candidates had to be wealthy because they had to pay all their election expenses, including the cost of holding the poll and MPs were expected to donate to local charities and other worthy causes.
From the 20th Century
By the beginning of the 20th century trade unions were sponsoring Liberal and Labour MPs to get working class representation but a court decision in 1909 made it illegal for them to use their funds for political purposes and the Liberals, who had an electoral pact with Labour, introduced MPs pay in an Act of 1911.
MPs’ pay was gradually increased from £400 in 1912 to £3250 in 1964, with still the assumption that MPs were part-time and had other income, but thereafter, with Governments applying prices and incomes policies to deal with Britain’s economic problems or coping with periodic recessions, party leaders were reluctant to be seen to increasing MPs’ pay. This had a number of effects:-
Independent Bodies setting pay
There was an attempt to get independent bodies to decide MPs’ pay by comparing the job with other types of work, though the problem has always been that there isn’t really any occupation which has the range of tasks that MPs do.
The Top Salaries Review Body was given the job in 1971, this was taken over by the Senior Salaries Review Body in 1996 and then, after the expenses scandal, it was given to IPSA, the new expenses regulator.
The problem has always been that these bodies come up with higher salaries than the party leaders are prepared to allow, given the public reaction to pay increases, as the recent IPSA proposal demonstrated.
The current salary is £66,000, less than for most other legislators in Western countries. IPSA recommended an increase to £74962 from April 2016 and this has been implemented despite media pressure and the decisions of some MPs not to take the increase. Hansard Society survey found that on average MPs worked 65 hours a week so their salary amounts to about £20 an hour, before tax.
Expenses developed, partly as a substitute for higher wages, and the whips encouraged MPs to see it that way.
Free rail travel was introduced in 1924 and office and research expenses were introduced in 1969 and gradually increased to allow MPs to deal with the increasing amount of constituency correspondence and the increasing complexity of Government.
MPs were increasingly expected to live in the constituency as well as London and, given that there was no allowance for running a second home, this created problems. One Labour MP from Glasgow with several children couldn’t afford to rent in London as well as maintain his house in Glasgow and so, at the end of business, travelled to Glasgow on the overnight sleeper, as rail fares were paid, and back again the next morning.
An Additional Costs Allowance was added to allow MPs to support a second home. Older MPs with no pension stayed in the House of Commons until they died and eventually a pension scheme and a resettlement grant for MPs who retired or lost in the general election was added. Finally, a Communications Allowance for distributing material to constituents was added in 2007.
MPs take on other paid work
Most MPs experience a drop in salary if they give up their previous job to become an MP. Given that the Parliamentary tradition had been that MPs did other work in the morning and came to Westminster in the middle of the afternoon it became accepted that MPs could have other paid work. By the 1980s some MPs were signing up to political consultancies and accepting any clients that the consultancy asked them to take on.
The Committee on Standards and Privileges consisted of senior MPs who were charged with investigating any misdemeanours by MPs but the general view was that MPs were gentlemen and knew what was right and wrong and it was mostly ineffective.
The system of self-regulation in Parliament contrasted with the strict regulation of Ministers, civil servants and local councillors in relation to interests.
There was a register of members’ interest but no compulsion on MPs to take part. Parliament has since suffered from two scandals that have affected the public’s perception of Parliament and have led to changes in the regulation of MPs interests and expenses.