House of Lords: Allowances

Lord Sewel Excerpts

Tuesday 20th July 2010 Lords Chamber

[Lord Grenfell]

My Lords, I have a lot of sympathy for what the noble Lord, Lord Methuen, has said in his amendment, but I wish to address the question of the all-party parliamentary groups, of which I am a great supporter. The country groups—I do not exclude the others but my experience is with the country groups and I declare an interest as an officer of three of them—are great added value for your Lordships' House because they bring us into contact with the Parliaments and Governments of other countries.

However, there seems to be a problem which may be an inconsistency. Perhaps the noble Lord could clear it up. Under “Type of business” in Annex A, it says that the daily allowance would be available for,

“Committee Visits and official business

Members of parliamentary delegations

Travel as a Representative of the House

Lords outreach programme”.

But paragraph 21 says:

“There are three categories of such business as follows”,

for parliamentary business away from Westminster.

Paragraph 21(b) refers to,

“travel in connection with certain authorised business, such as CPA and IPU business”.

Unless that covers the activities of the all-party groups, we have a problem. Will the Leader of the House tell us whether the phrase,

“such as CPA and IPU business”,

would cover all-party groups because so many of them are in relation to the IPU? We need to know that. A lot of Peers would like to go on some of these all-party group visits but are somewhat deterred by the fact that when they are away they are deprived of some of the allowances to which they feel that they are entitled.

[Lord Sewel]

My Lords, a centrepiece of the proposals, which perhaps causes some of us great difficulty, is the abolition of the separate overnight allowance and its wrapping up in a uniform fee of £300 for all Peers. Before I speak on that, I want to speak briefly about the matter of the £150 dealing with committee visits and delegations. For some years now I have been a member of and have chaired various sub-committees and committees of your Lordships' House. I have found an understandable reluctance among some Peers to travel away from Westminster on specific days when the House is sitting. My fear is that the proposals before us today will increase that reluctance. Can we have an assurance from the Leader of the House that if it is evident that it is becoming more difficult for Peers to go on delegations and, for example, committee visits to Brussels on a day basis, that that will be looked at fairly quickly? We get enormous value out of short visits to see the Commission and other European institutions, so it would be a sad thing if those were to attenuate over time.

Let me return to the main issue. On 28 June the noble Lord, Lord Strathclyde, in referring to the advantages of the £300 uniform fee, said:

“How much Peers spend on each item would be entirely up to them”.

Yes, but that is not the entire story. He also said in summing up that one of the major advantages would be that:

“This will mean a reduction in the amount that some Peers have claimed in the past”.—[Official Report, 28/6/10; cols. 1512-13.]

Again, yes, but that is not the whole story. First, how much real choice do Peers have on how they spend the daily allowance? There is actually not much choice at all if you live a significant distance from London. If you live 300, 400, 500 or 600 miles from London—I should declare an interest as I live in Aberdeenshire, which is just over 500 miles away from Westminster—and come down on a Monday, you are here for the rest of the week. You cannot go backwards and forwards, so you have to have accommodation for an entire week.

I do not think that Peers should be expected to live out of a suitcase. It is quite reasonable that they should be able to rent or obtain a modest one-bedroom flat. The going rent for that, on checking with estate agents and The House magazine, is somewhere in the region of £350 a week, which is £18,200 over a year, plus council tax and utilities. That is approximately £20,000 a year that someone needs to pay out in order to maintain a presence in London, which is an absolute requirement to attend your Lordships’ House. It is not a matter of choice; it is an imperative and a requirement.

Under the proposals, a payment of £300 over 145 sitting days—over a five-year Parliament there are actually fewer than 145 sitting days, but we shall take that figure for the moment—produces support of £43,500 a year. Those living a significant distance from London are locked into a system where almost 50 per cent of their total possible support will be taken up by the housing costs that are a pre-requisite of attending your Lordships’ House. That is not something which is faced by those whose primary residence is in London.

The noble Lord, Lord Strathclyde, said that some will lose. Yes, that is absolutely true, and we pray in aid austerity to defend it, which is reasonable. We ought to be prepared to make sacrifices in a situation where our fellow citizens are making sacrifices. So let us look at the 24-hour rate. The claimable amount for those whose principal residence is outside London will go down from £335 to £300 a day, which on a weekly basis is a small reduction of £140 a week. For those whose principal residence is in London, it is a move from £161 a day to £300 a day. That does not seem to be a contribution to austerity. How is that figure squared?

I recognise that there were two problems with the overnight allowance: some people did not tell the truth; and some people were confused because we had never defined what was a principal residence. We went through the pain of establishing a robust, common-sense and sensible definition of what is a principal residence. That is now followed-up by a paper trail by which you can clearly demonstrate that your principal residence is outside London. Why do we not use the robust system that we have introduced?

As the noble Lord, Lord Tomlinson, said, equity does not mean that you treat everyone the same but that you recognise the differences that people have to face in order to perform the same task. That is the essence of the problem. I accept that what is proposed has been brought forward in all honesty, that it is not perfect but deals with a number of problems, that everyone is treated the same and superficially it looks fair and simple and provides rough justice. My problem is that it has within its heart the possibility for great injustice, and that has not been addressed.

--- Later in debate ---

[Lord Strathclyde]

It is entirely typical of my noble friend to ask such an excellent question. My figures were, of course, on a like-for-like basis. He will recognise that phrase from his time in government.

[Lord Sewel]

I am very grateful to the noble Lord for giving way. Has he any calculation of the effect of moving from £161 a day to £300 a day for those who do not claim the overnight allowance?

[Lord Strathclyde]

No, my Lords, because I do not know how many of those who claim the £160 amount would claim the £300 amount, so I cannot help the noble Lord with that. It is my view that, on a like-for-like basis, it is broadly cost-neutral. The House is increasing in size, but was in any case, so it was going to cost more. I hope that we will get a worthy and worthwhile contribution from the new Members of this House who come here to play their part.

I was just saying that it is now 40 years since the original expenses scheme was introduced. I have no idea whether it will be another 40 years before we return to the issue. I know that it is the dream of the Deputy Prime Minister—and me—that long before that, we will have a fully reformed House, in which case there will be an entirely different regime.

The resolutions and Motions before us today will allow us to return in October to start afresh with a new scheme of financial assistance for Members. They allow us to put past indiscretions very much behind us. I believe that they will give us the confidence to look forward and concentrate fully on the excellent work that this House does in holding the Government to account. I very much hope that the House will now approve the resolutions before us.