Parliamentary Standards Act 2009

Peter Bottomley Excerpts

Thursday 15th December 2011 Commons Chamber

[Adam Afriyie]

The hon. Lady makes the point very well. Those who actually read the report will see that that is exactly what we were attempting to achieve. I think that we achieve it elegantly in our recommendations to IPSA on how to improve the way it operates, and we achieve it in quite a moderate fashion in the recommendations that the Government may want to take up in the months and years to come.

[Sir Peter Bottomley (Worthing West) (Con)]

I echo the words of my hon. Friend the Member for Colchester (Bob Russell) about anything that we say here not being derogatory about IPSA staff, who face the same problems we do. I draw the attention of my hon. Friend the Member for Windsor (Adam Afriyie) to the answers in annex 1, which show that four out of five MPs think that IPSA is not effective in helping us to do our job. I tried to ring IPSA this morning, because I see that 99 times out of 100 it answers the phone within 60 seconds. I started calling at 9 o’clock; it is now half-past 12. That is three and a half hours. It is a bit like the train operating company that said, “No trains this morning were late because we didn’t run any.” IPSA will not answer the phone before 1 o’clock, and then we discover that the person we want is at lunch. If the amendment is carried—I am not sure whether it should be—will my hon. Friend try to persuade IPSA to pay attention to the detail of the report? Does IPSA have to be the only public service that for half the day is not available to somebody who wants to ring it?

[Adam Afriyie]

That is another point very well made. I hope that the direction of travel in the recommendations will precipitate such an outcome when IPSA reflects on them.

I draw everyone’s attention to the survey in annex 1, on page 66, which contains some telling statistics. We conducted a brief survey towards the end of the inquiry to ensure that we were picking up contemporary, rather than historical, points of view of Members of Parliament. There are some striking figures. For example, 81% of MPs do not believe that the board of IPSA has been effective in supporting MPs in conducting their duties. Even if the intention was to be supportive, it is quite telling that over 80% of MPs do not think that it is. Another fascinating statistic is that 93% of MPs are subsidising their work here. That is a contemporary figure from two or three weeks ago.

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[Adam Afriyie]

The hon. Gentleman makes his point well. It is not in the report, but I accept it.

To return to the point made by my right hon. Friend the Member for Chichester (Mr Tyrie)—[Interruption.] Have I just promoted him?

[Sir Peter Bottomley]

He should be right hon.

[Adam Afriyie]

Indeed he should.

The report contains two pretty uncontroversial recommendations, and again this brings me to the second misrepresentation. The first recommendation, which is for the Government, is that the primary duty of the independent regulator and its administration should be to support MPs to perform their duties cost-effectively and efficiently. The Committee on Standards in Public Life and the constitutional historians we spoke to recommended that, as virtually every body in the world has that kind of line in their legislation. There is no time limit on that, so we recommend that the Government should at some point get around to doing that, and I urge them to do so.

IPSA is unique in being both the regulator and administrator of an expenses system. The second recommendation is that the law should be updated to enable the separation of those two functions. We are not saying that the administration function should definitely come to the House of Commons. We say nothing of the sort. We are not going to recreate the old Fees Office, which would be absolute madness, so that will not happen. However, we should be able to separate those two functions within the legislation, and I urge the Government—there is no need to answer this now—to make headway and look at how we might facilitate that while ensuring that the regulatory role is entirely independent of the House.

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[Adam Afriyie]

The report also makes that recommendation, urging IPSA to continue in that direction and, as far as possible, like most other organisations, to do some central purchasing and secure some wholesale agreements, as it has with rail travel. It is stepping slowly in that direction, but we urge it to move a lot more quickly, so that our time and that of our staff can be spent on constituents rather than on unnecessary bureaucracy.

It is very hard to see anything controversial in our report; it is incredibly moderate, calm and analytical. It also asks that IPSA be more transparent and explain to the public—on its website, or in a letter to us—its existing system of supplements for London, for the outer London area and for mileage; explain its rationale for those items, which it has introduced, because the public need to know why it has done so; and then to show very clearly the methodology behind the calculation that enables it to arrive at its figures for those supplements. That would be a very useful exercise, because then people might see how the numbers are calculated and where they come from.

In the second part of recommendation 17, we say that if the system that IPSA has already introduced to London and the outer London area were rolled out—so we are not making a decision on it, but saying, “if it were rolled out”—let us ask a third party, not us or IPSA, to undertake a cost-benefit analysis to see whether it saves taxpayers money and provides them with value for money. Even if it does, and it may not, that is not good enough, however, so we recommend that a third party evaluate whether the system continues to meet the aims of the 2009 Act. Again, that is pretty uncontroversial: we simply, and perfectly reasonably, ask for information, and for an analysis and evaluation to be undertaken.

Recommendation 17(c) may have caused a little concern. During my discussions with the Leader of the House and others, there was some concern that it implies that Members should take control of the expenses system again and “decide” what IPSA does. May I just be absolutely clear, however, and ask Front Benchers to reflect on the fact that, if that were the argument, I have made it clear—including in the amendment that I attempted to table—that that is definitely not the intention? If a word is slightly out of place, I would just say that the report is not legislation but merely a set of recommendations, and I apologise on behalf of the Committee.

The recommendation states that, once the cost-benefit analysis has been completed and we are able to work out whether the taxpayer would get better value while accountability, transparency and everything else are maintained, the House should express its opinion, which I imagine would be in the form of a motion or an early-day motion, stating: “In the opinion of this House, we think this piece of work is jolly good and IPSA should think about it.” We would not be overruling IPSA—nothing of the sort; it would be another recommendation in a report, and that would be it.

[Sir Peter Bottomley]

Will my hon. Friend explain recommendation 18, which states that MPs should have no increase in pay during a Parliament? I agree with that, but should it not read as IPSA setting, in advance of an election, what the pay will be?

When I searched for best matches for IPSA telephone operating hours, the search engine recommended that I go to the International Professional Surrogates Association, which deals with problems of “physical and emotional intimacy”. That is the problem we have with IPSA.

[Adam Afriyie]

I suspect that we have some of those problems in the House as well.

On recommendation 18, in the Welsh Assembly and many others throughout the world a figure is set for the duration of a Parliament. We now have fixed-term Parliaments for five years, but the Committee felt that, even if we did not, it would be far better to select a figure that remained the same for the entire Parliament. Then we would not have the constant moving around and unnecessary changes that we currently experience. The situation seems to work very well in Wales with the Welsh Assembly and elsewhere, so we recommend not that IPSA introduce the proposal, but that it look at it, so that we do not have stories every three months about another change—another shift in the level—and whether a figure relates to RPI or to CPI. Let us forget all that and just have a fixed figure that runs for a Parliament.

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[Mr Raynsford]

I assure my hon. Friend that I do not make a profit.

I thank the hon. Member for Windsor (Adam Afriyie) not only for his introductory remarks, which have given a good and fair outline of the Committee’s report, but for all his work, not just as Chair of the Committee but prior to its establishment, in ensuring that this important issue is looked at in a clear and dispassionate way. I believe that, under his chairmanship, the Committee achieved that objective. It looked carefully, rigorously and dispassionately at the evidence and has come forward with recommendations that I believe are sound and sensible and should be taken up.

However, a few key messages need emphasising. The first is that, contrary to what has been suggested by some commentators, who have rushed into print to condemn the report, the Committee was adamant—no pun intended—in its support for the retention of independent regulation of MPs’ expenses. As the surveys conducted by the National Audit Office earlier this year and the Committee itself more recently have demonstrated, there is a very wide degree of support among MPs generally for the principle of independent regulation. Some 77% of MPs who responded to the latest survey agreed that independent regulation was important for restoring public confidence.

Having said that, the way in which the independent regulator has operated the system since May 2010 has been fraught with problems. Those problems provided a huge amount of evidence to the Committee in the course of its considerations. They are all documented in the report and its annexe. The process for making claims, considering them and paying expenses has proved slow and cumbersome. Many MPs have been left substantially out of pocket because of the time lag between expenditure and reimbursement. The system is far from cost-effective. As the hon. Member for Colchester (Bob Russell) highlighted, the NAO concluded last summer that 38% of claims at that time involved processing costs higher than the amount being claimed.

The system also imposes heavy burdens on MPs’ staff, thus diverting them away from their primary responsibility of looking after the interests of constituents. It also, of course, imposes burdens on MPs themselves. There is a great deal of evidence that MPs are not able to perform other functions because of the time that they have to spend on cumbersome bureaucratic processes. There is also evidence that MPs are deterred from making claims because of time-consuming and tortuous processes and the lack of clear advice from IPSA on what claims may be appropriate. There is also the fear of being subject to media and public criticism, either for claiming too much, or—paradoxically—for claiming too little; we all know of examples of minor items that Members feel would be held up to ridicule if a claim were seen to have been made for them.

Both the NAO report last summer and the Committee’s report, published now, demonstrate a very high level of dissatisfaction on the part of MPs about the working of the system as currently operated—not, I stress, about the concept of independent regulation, but about the system as it is currently operating.

[Sir Peter Bottomley]

On dissatisfaction, I should say that the public interest is illustrated in paragraph 80, page 27, which points out that the cost of IPSA is £6.4 million. If we allowed £400,000 for processing payroll, that would leave costs of £6 million for other expenses of £19.5 million. I cannot believe that the House would allow that to happen in any other part of the public sector.

[Mr Raynsford]

I was going to come to this point later, but I entirely concur with the hon. Gentleman's view that the system is cumbersome and slow, and is not cost-effective. It is costing the country a great deal more than is necessary for a safe, rigorous and transparent system for overseeing MPs’ expenses claims.