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New rules for MPs to be outlined MPs may not face family jobs ban
(about 10 hours later)
Details of how MPs' expenses will be overhauled are to be outlined as part of a public consultation on changes to the now discredited former system. The man in charge of overhauling MPs' expenses has suggested they might not have to stop employing relatives.
All the party leaders want sweeping changes proposed by the Kelly committee in November to be fully implemented in light of abuses by many MPs. More than 200 MPs employ relatives but a six-month inquiry said the practice should be phased out.
But the man who will introduce the new system has suggested he does not feel bound to enact all the recommendations. But Sir Ian Kennedy, who decides what plans go forward, said he wanted to give people the chance to argue against a ban as he launched a consultation.
Sir Ian Kennedy said he would consult on other options in some cases. But he also said generous "golden goodbyes" should end and suggested MPs take out employment insurance.
'Cherry-picking' fear In the consultation document on changes to the expenses system, he also suggests MPs with children - those with "caring responsibilities" could get the right to claim higher expenses.
Sir Ian, chairman of the external regulator which will introduce and enforce the new expenses system, wants to consult MPs and the public over the shape of the new regime in time for the next election. 'Golden goodbyes'
The consultation process will focus on proposals in key areas such as what MPs can be reimbursed for travel, subsistence, accommodation and staff costs. There had been concerns that reducing expenses could mean fewer people with children applying to be MPs.
Gordon Brown, David Cameron and Nick Clegg have endorsed all the recommendations put forward by Sir Christopher Kelly's committee as a way of rebuilding trust in Parliament. The proposals say any changes must not "unduly deter" any group of people from standing for election.
These include a ban on mortgage claims for second homes and on MPs employing spouses and relatives on their payroll. Sir Ian - the man appointed to head up the external regulator which will introduce and enforce a new expenses system - is consulting on proposals drawn up after Sir Christopher Kelly's inquiry into the much-criticised expenses system.
Other recommendations would require MPs making a capital gain on the sale of a publicly subsidised home to repay the money, prevent MPs within "a reasonable commuting distance" of London from having second homes funded out of the public purse and reduce the pay-offs to MPs standing down between elections. There is also an argument that the tenure of an MP is inherently uncertain, such that MPs should not have locked themselves into long term mortgage arrangements dependent on public funding Ipsa consultation
But there has been speculation as to how many of these will be adopted by the Independent Parliamentary Standards Authority (IPSA). That inquiry proposed ending MPs' mortgage claims, stopping them employing relatives and reducing generous "golden goodbye" payoffs to retiring MPs or those who lose their seats.
Some MPs have expressed concerns that the reform package will be "cherry-picked" with some proposals watered down. The consultation document confirms that Sir Ian backs proposals to stop MPs buying taxpayer-funded second homes - something that had led to criticism MPs could act as property speculators at public expense.
Speaking on Tuesday, Sir Ian said he wanted to "build" the new system around the Kelly recommendations but his body must have a free hand to shape the system in the best interests of MPs and taxpayers. Instead of being allowed to claim for mortgage interest, they should claim for rent and hotel stays, utility bills and insurance, the document says.
The consultation document would show of the Kelly proposals the regulator would endorse and those for which it believed alternatives were worth considering, he suggested. Security measures
'Clean sheet' Several MPs have raised concerns they may lose money if forced to sell properties earlier than expected to comply with new rules.
There is a consensus behind most of the main Kelly proposals, including a future ban on mortgage interest claims on second homes, outlawing the practice of "flipping" homes and restricting expenses claims to items such as utility and phone bills - excluding gardening and cleaning claims. But the document points out: "There is also an argument that the tenure of an MP is inherently uncertain, such that MPs should not have locked themselves into long term mortgage arrangements dependent on public funding."
But some of the recommendations, particularly that of barring spouses and family members from MPs' payrolls after a transitional period of five years, are controversial and unpopular with many MPs. But it also suggests MPs should be allowed to claim for "approved security measures" - something that was not backed by Sir Christopher Kelly's six-month inquiry.
Sir Ian has said the new system must be "clear, workable and fair" for MPs and "command the support and confidence of the public". Sir Ian said he was not convinced taxpayers should fund payoffs for retiring MPs
He also warned a new system would not be in place in time if the poll was held before May, the most likely date for the election. And while Sir Christopher Kelly had said MPs within "reasonable commuting distance" of Westminster should not be able to claim for a second home - Sir Ian narrows that down by suggesting only those in the London transport zones one to six should be stopped from claiming.
The document says Ipsa, the external regulator set up by Parliament to introduce a new expenses system, is giving "detailed consideration" to a suggestion that Parliament use a rental agency to find MPs properties - as the Ministry of Defence does to allocate its staff London homes.
The inquiry into the expenses system recommended a cut to the generous "golden goodbye" payoffs for MPs who step down or lose their seats at a general election.
Currently they can get payoffs of up to £65,000 - depending on how long they have been an MP - the first £30,000 of which is tax-free.
Sir Ian's paper suggests he might go further, adding: "We remain unconvinced of the need for payments to MPs on leaving parliament."
It points out that some professions "where there is a risk of unexpected job losses" people can take out their own insurance policy.
"MPs voluntarily accept a career with a high level of uncertainty and we understand that many would want arrangements in place to help mitigate that uncertainty.
"We do not believe, however, that there is a clear-cut case that the taxpayer should bear the cost of supporting those arrangements."
All the party leaders want sweeping changes proposed by Sir Christopher Kelly's inquiry to be fully implemented in light of abuses by many MPs.
But Sir Ian has suggested he does not feel bound to enact all the recommendations and will decide after the consultation which closes next month.