Public Duty Costs Allowance

Monday 21st November 2022 Lords Chamber

Question

15:05

Asked by

[Lord Rennard]

To ask His Majesty’s Government what plans they have to revise the Public Duty Costs Allowance for former Prime Ministers.

[The Minister of State, Cabinet Office (Baroness Neville-Rolfe) (Con)]

My Lords, the public duty costs allowance assists former Prime Ministers who remain active in public life. The allowance is not paid directly to former Prime Ministers; rather, claims may be made from the allowance to reimburse incurred expenses that arise from the fulfilment of public duties, such as office and secretarial costs. The allowance has been frozen at an annual limit of £115,000 since 2011. The Government keep these matters under review.

[Lord Rennard (LD)]

My Lords, we have a rapidly increasing number of ex-Prime Ministers. Three of them continue to sit as MPs. While Theresa May claims only a part of the ex-Prime Minister’s allowance, Boris Johnson and Liz Truss are entitled to claim up to £115,000 a year for as long as they say they are doing public duties, which may be for the rest of their lives. This is in addition to MPs’ office costs allowance, which is subject to some public scrutiny, unlike the ex-Prime Ministers’ allowance. They are also able to earn from speeches, books and newspaper articles. Is it not time that we had a proper review of these allowances? We have reduced it for sitting MPs and made it for a fixed period only.

[Baroness Neville-Rolfe (Con)]

My Lords, hitherto this allowance has been the subject of cross-party consensus. Of course, it was introduced by the Conservative Government to update the arrangements at the time of the late Baroness Thatcher’s retirement and has been claimed since 2013 by several former Prime Ministers. However, no claims have been received from Boris Johnson or Liz Truss in relation to the PDCA; nor has any indication been given that claims will be made.

[Lord Butler of Brockwell (CB)]

My Lords, I was Cabinet Secretary and Mr Major was Prime Minister when this allowance was introduced. Is not the noble Lord, Lord Rennard, being a little ungenerous? Former Prime Ministers do incur extra costs as a result of the public office that they have held. The allowance need be claimed only to the extent that they incur those extra costs.

[Baroness Neville-Rolfe (Con)]

I very much agree with the noble Lord, Ex-Prime Ministers still have a special position in public life and need to pay office and staff costs in support of that. Sometimes, things change. The arrangements referred to were extended to a colleague of the noble Lord, Lord Rennard, Sir Nick Clegg, who was Deputy Prime Minister from 2010 to 2015, a unique status at that time. He claimed £444,000 before he left to become a highly paid Silicon Valley executive and lobbyist.

[Lord Collins of Highbury (Lab)]

My Lords, the Minister is right that there was a consensus on the introduction of this allowance, and no one disputes the need for it. However, she is also right that the Government should keep this under review, because after the retirements of the late Baroness Thatcher and Tony Blair, both long-serving Prime Ministers, we now have a situation where a Prime Minister has served the shortest period in history. Does that not indicate the need for a review and perhaps the introduction of a pro rata allowance?

[Baroness Neville-Rolfe (Con)]

I assure the noble Lord that the Government keep these matters under review and that the level of the limit is reviewed by the Prime Minister, at the start of a Parliament and annually. However, as I said, we have no plans to revise the limit at this time.

[Baroness Jones of Moulsecoomb (GP)]

My Lords, I deeply regret that there has not been a Green Prime Minister at whom the Minister can take pot-shots. It is ludicrous and inappropriate, if the Conservative Party is going to change its Prime Minister every seven weeks, to give them that sort of allowance. What about having a limit on the amount of time that they have served as Prime Minister; for example, two and a half years?

[Baroness Neville-Rolfe (Con)]

It is very much my hope that the current Prime Minister serves for a long time and that this problem passes.

[Lord Wallace of Saltaire (LD)]

My Lords, when we have Ministers cracking jokes about how many people have occupied their post in the last six months, we recognise that the rate of ministerial and prime ministerial turnover needs to decrease. When she was Prime Minister, Prime Minister Truss made it very clear that she was in favour of a smaller state, with fewer subsidies to individuals. May we therefore take it as given that she is highly unlikely to claim what would be, in effect, a state subsidy now that she has resigned?

[Baroness Neville-Rolfe (Con)]

Whether to waive such payments is entirely a matter for the ex-Prime Minister involved, as the noble Lord knows only too well. But I applaud Prime Minister Truss for some of the points she made about efficiency. These are important issues and we should not decry her for making such points.

[Lord Porter of Spalding (Con)]

Does my noble friend agree that, given the performance of some sitting Prime Ministers over the last 25 years, paying ex-Prime Ministers could sometimes be seen as better value for the taxpayer than paying serving Prime Ministers?

[Baroness Neville-Rolfe (Con)]

My Lords, I do not know how to answer that question. I return to the point I made at the beginning: ex-Prime Ministers have a special position in public life. This is not as it is in other countries, where ex-Prime Ministers often have substantial salaries, houses and things. I have been around the world and noticed that. We have a public duty costs allowance, which is incurred only when the former Prime Minister fulfils public duties linked to their former office. That is carefully reimbursed by the Cabinet Office, when it has evidence that the money has been properly spent.

[Lord Bird (CB)]

Is it possible that we could get back some of the cost of running a Prime Minister when we realise that they can make millions of pounds after they leave office? Mr Blair and Mr Cameron are worth a few bob, and I know Mr Johnson will be. We could try to get 10% or 20% of that money back in the public coffers.

[Baroness Neville-Rolfe (Con)]

I do not agree with that, although I am a big reader of the Big Issue.

[Lord Forsyth of Drumlean (Con)]

My Lords, could my noble friend assure me that none of the money from the allowance will be used by Mr Gordon Brown and Sir Keir Starmer to plot the abolition of this House?

[Baroness Neville-Rolfe (Con)]

It is up to past Prime Ministers, including Gordon Brown, to submit invoices in accordance with the rules of this scheme. I am sure they will continue to do that.

[Baroness Prosser (Lab)]

My Lords, noble Lords should bear in mind that questions and answers should be about the principles being posed. Finger-pointing at individuals, from whichever side of the Chamber, is deeply unhelpful and does nothing to enhance the status of this House.

[Baroness Neville-Rolfe (Con)]

I agree with the noble Baroness. That was exactly what I have been saying, in slightly different language. This allowance has been the subject of cross-party consensus. It is important to maintain the special position of former Prime Ministers in public life. I started with my mentor, Baroness Thatcher, who certainly needed this allowance in her latter days.