Changes to Expenses

Speaking from Westminster David Maclean said:

“I have been asked if I support the changes announced by Mr Speaker on Tuesday evening.

I was privileged to be part of the emergency meeting last night to plan changes to the allowances system. It was chaired by the Speaker and attended by all the Party leaders. I was at the meeting and argued for changes. Therefore I am very pleased to support Mr Speaker’s announcement. I regret that I and two other MPs had spent 6 months last year working on similar reform plans which were voted down and now everyone is lifting bits out of our report as if they were new ideas.

It was also a chance to push for some of the reforms which were in that MEC Report of spring last year but which was defeated in the Commons. Perhaps the Telegraph, since they are so good at investigative reporting, should check the voting record of those who voted for my report last year to reform expenses and those who voted it down. Some of those calling for reform today were opposed to our reforms last year. That is the real list of “saints” and “sinners.”

We agreed that that there would be no more claims for furniture and white goods. That was in my report and I did not claim for any furniture in the last year. My total furniture claim has been less than £5,000 in 5 years.
We agreed that there could be no voluntary “flipping” of second homes/main homes. I naturally agreed and it is likely that we will now adopt once again the same strict rule I HAD TO OPERATE UNDER in 2001 and 2005 and which the Fees Office on Monday confirmed were the rules that applied to me in the past. The irony has not escaped me. I HAVE NEVER CHOSEN TO “FLIP.”

We agreed that we will all sign a declaration for the taxman on Capital Gains Tax and stating whether or not Additional Costs Allowance was payable on it. Once again I stress that CGT was not payable on my house in the constituency because it was our main home.
We agreed that married couples/partners who were MP could only claim one living in London Allowance.

WE agreed that mortgage payments are for interest only and ALL MPs must produce evidence every year of the amount of the mortgage and that it is ongoing. I have always done so and am appalled that some MPs have claimed for a non-existent mortgage. WE also set a ceiling of £1250 per month (£15,000 pa) My mortgage is less than £6,000 per annum.

We agreed to refer all past Additional Costs Claims to an outside panel for scrutiny. Officials pointed out that there were 28,000 receipts to look at and it could take many months. We asked for it to be done as soon as possible.
We also asked the Fees Office to work up a system to publish all authorised claims on line once they were paid. At the moment we plan to do this every 3 months and it will take some time for the officials to sort this out. However the Conservative Party is doing this already.

We also agreed a “green paper” presented by the Prime Minister on having all the administrative work of expenses handling done by an outside body. The paper was rich in rhetoric but lacking in details. I said that I supported the principle but that there were hundreds of loose ends which had not been thought through and we would look foolish if we rushed this out as the perfect solution only for it to fall apart in days. We all agreed to the concept and asked the Leader of the House to spell out more details today and go out to consultation on how it will work.

I therefore totally support all the changes announced by Mr Speaker. It is ironic that on the day he announces his departure he has set the scene for a new beginning with the changes he has announced.”

The Daily Politics says David Maclean “Unfairly misreported.”

The House of Commons Fees Office says, “For many years the position was that Members who were Ministers or office-holders (this included the Opposition Chief Whip) had to deem their main home for Additional Costs Purpose as their home in London.”

“They support my assertions that I am not a crook but it is too late – my reputation is destroyed – the damage is done.” – says David Maclean.

First of all I am very sorry that I have not been returning media calls and turning down interviews. I have been concentrating my energies in trying to get more evidence to show that the Telegraph deliberately misreported me.
Of course I understand that every reporter and media outlet hated my FOI Bill and that is a genuine position to have but I say again that I brought the bill in to protect MP’s correspondence with constituents. I worked intensely for 6 months last year trying to reform the MP expenses system but that was rejected by the House. However the Telegraph made it clear that they were going to get me on expenses, no matter how thin the story, because of my FOI Bill in the same way as the Mail on Sunday ran a personal story to discredit me at the time.

The main Telegraph attack is very serious. An allegation that I dodged CGT makes me a crook and that allegation has reverberated round the constituency.

I refute the allegations entirely.

I was a back bencher from November 2005 when I ceased to be Chief Whip and when we sold Deer Rudding in 2006 it was my main home within the rules of the Green Book as well as legally in the eyes of the Inland Revenue. Had it been my second home at the time of my selling it, I would have paid capital gains tax on it, if there were any to pay since I have read ridiculous stories on my alleged profit on that house.

I have made it absolutely clear that I will pay capital gains tax on my flat in London when and if I sell it.

I have never flipped my homes. This was all done by the book as and when I became a minister and then ceased to be one, and again when I became chief whip and then ceased to be.

I have now obtained a transcript of The Daily Politics programme (Attached as well as link where this item appears just over half way through). The presenter said that there were 5 categories of MPs involved in this scandal;
• Law Breakers (claiming for a non-existent mortgage)
• Rule Breakers (claiming for impermissible expenses like swimming pools)
• Playing The System (like “flipping” house 5 times in 4 years)
• Lapse of Judgement (like claiming for expensive antique furniture) and
• Unfairly Misreported (like Gordon Brown and David Maclean)

She went on to say,” Now they were initially criticised by the press, but if you delve a little bit deeper it does appear that they had valid reasons for making the claims.”

I also attach a letter from the Director of Operations of the Fees Office of the House of Commons. It confirms exactly what I said to the Telegraph and issued in my statement, “For many years the position was that Members who were Ministers or office holders (this included the Opposition Chief Whip) had to deem their main home for Additional Costs Purposes as their home in London.”

I am also looking through all my old paperwork to send to the Chief Whip and David Cameron’s Scrutiny Committee so that they can rule on whether any of my expenses were out of order. I will, naturally abide by their decision. However that is now academic; despite the statement of the Daily Politics presenter and the letter from the Director of the Fees Office supporting my position, the damage is done. Even if I were exonerated by The Pope and President Obama that will not wash in the court of public opinion. Once you are branded a crook, that sticks.

I am devastated by being included with MPs who broke the law and saddened that so many prefer the Telegraph version of events rather than the truth.”

David Maclean’s response to Sunday Telegraph front page story of 17th May

“I was contacted by the Telegraph on Saturday with a whole series of allegations ranging from the serious to the farcical. They were sent a full explanation and denial but have chosen to publish a distorted version of a serious allegation that I dodged Capital Gains Tax.

I utterly refute this allegation.

The Telegraph know that this is untrue but it did not suit their plan for Sunday. An insider told me on Saturday that no matter what I said I was “going to be done” because of my FOI Bill. The Telegraph planned to cover all MPs who were involved with the FOI Bill and since I was the lead MP they had to get me even if I had committed no offence. Hence the 8 allegations in the hope that one could stick.

This is my full response to the Telegraph allegations on CGT and claiming for a “Main Home.”

In all my life as an MP I have had a main home in the constituency and a flat in London. I rented a flat in London until about 1993 when I purchased one. The constituency has always been my base and I spend 4 weekends out of five here and most nights per year.
I quote from the Green Book Rules we all had to follow. These rules were changed by the Government in 2004 I think.

3.9.1 Definitions

Main Home

When you enter Parliament we will ask you to give the address of your main home for the purposes of ACA and travel entitlements. It is your responsibility to tell us if this changes. This will remain your main home unless you tell us otherwise.

If you are a Minister or office holder then your main home is deemed to be in London. Unless you are provided with an official residence, you will receive a London supplement with your salary and you may be eligible to claim ACA in the constituency.

For other Members the location of your main home will normally be a matter of fact. If you have more than one home, your main home will normally be the one where you spend more nights than any other.

I have complied with those instructions every year I have been an MP. When I became a minister in 1987 the Fees Office deemed me to be London based and I had to claim on my constituency house. On ceasing to be a minister in 1997 we reverted to the normal rule of claiming additional costs in London. When I became Opposition Chief Whip in 2001 the Fees Office informed me that I was now a paid office holder and I was deemed to live in London as my main home whether or not that was the case. I was therefore instructed to claim ACA on my constituency home. I did not “flip” or choose to do this. It was compulsory and I would have been reported for a serious breach of the rules if I tried otherwise. When I ceased to be Chief Whip in Nov/Dec 2005 I followed the instruction above and since I was now a backbencher again my additional costs were claimed on my London Flat.

I am not saying, “I was only following the rules,” but that I was forced to obey a rule which I thought illogical but which was rigorously enforced before Labour diluted them in 2004 when all MPs could “elect” which was their main home. That, I believe has caused the “flipping” problem.

The telegraph were sent a copy of the Green Book Rules. They know exactly what I and other paid office holders had to do but they have deliberately chosen to make totally misleading allegations about my constituency home. I have never “flipped” my property or sought to refurbish it at taxpayers expense. Indeed it would have been amazing if I could have “done up” Deer Rudding for only £20,000. It consumed all my salary and a huge mortgage.

Turning now to the Telegraph point 1.
Point 1.

As stated above, this was my main home which I was told I had to claim on because they would not allow me to claim on my London flat. The Fees Office were, I believe paying 1/12 of the maximum per month and wanted proof that the total costs of the house in the constituency were above the maximum. I could have sent them bare evidence to cover costs of £21,000 but in an attempt to be absolutely open with the Fees Office I gave them a statement showing the complete running costs and maintenance of my main home. I repeat the key point that my additional costs of living in London at that time were about £21,000 and I wanted to claim on my London flat but was compelled by the Fees Office and the rules to claim for my constituency house instead. That is why I had to show them evidence that my constituency house was costing more than £21,000 so that they could refund me the costs of living in London.

I know that it sounds ridiculous having to go through these hoops and how easy it is for the Telegraph to paint it as a ruse to milk the taxpayer or dodge tax. This rule permitted neither of those things and I did neither of those things. Nor could I milk the system because I was not in charge of events; I could not have foreseen when I would cease to be Chief Whip nor that my wife and I would split up and we would sell Deer Rudding. The only other option was to claim nothing at all but then I would have had to resign because I could not afford to live half my life in London or Cumbria without an allowance for one of them.

That house in Hesket Newmarket was our main home and was at all times even when I was made to nominate London under Green Book rules. Therefore capital gains was not paid on it. I will be eligible and will pay for capital gains on the London flat, at least when it rises above the purchase price one day hopefully. The house at Hesket Newmarket was my main home in the eyes of the Fees Office and the Inland Revenue when I sold it and therefore no tax was payable.

On Monday I will attempt to get confirmation from an official from the Fees Office that these

14thMay 2009 I have cut my expenses by almost 20% in 2008 -2009 – says David Maclean
Member of Parliament for Penrith and the Border, David Maclean, says that in the financial year just ended – 31^st March 2009 he estimates, from provisional figures, that the total amount claimed in running his office and living in London will be down from £155,000 to about £127,000. These were all savings made in the last financial year, before the scandal broke and without paying anything back.

He has released a full statement from Westminster, as follows:-
“I serve on the House of Commons Commission. Last year, Sir Stuart Bell (Labour), Nick Harvey (Lib Dem) and I were asked by the House of Commons to devise a new system of allowances. We worked hard for six months, took evidence from the Inland Revenue, Sir Christopher Kelly, independent accountants and others. Our report – The MEC Report on allowances was published and we made some serious recommendations for change.

• We recommended a large extension of independent audit of all expenses.
• We recommended that the receipt threshold be reduced from £25 to zero and that all claims should have receipts.
• We said that the Green Book on allowable expenses should be tightened and made more detailed.
• We said that, with immediate effect, Members should no longer be able to claim for furniture, household goods and capital improvements.
• We recommended that the Additional Costs Allowance be reduced from £24,000 to £19,600 for rates, rent, mortgage and utilities only and that a flat rate daily subsistence sum of £30, approved by the Inland Revenue, be introduced.

Regrettably the Government whipped against these key proposals, like abolition of the John Lewis list and cherry picked the best proposals. That has now come back to haunt us.

However, in looking at all my operating and running costs during last year I decided to implement our own report recommendations and immediately put them into practice even though they were not voted through. It would have been inconsistent to do otherwise. I also decided on cost savings. When the financial crisis struck in October I realised that this country would have to make radical cuts in government and local Government expenditure and we, as MPs would have to show the way. No matter what we were spending before and no matter what the maximum permitted allowance was I thought that we could only preach cutting back, if we cut back first.

Accordingly I decided to squeeze my own costs even further.

I was going to issue these figures when they are finally signed off in July but because of the current expenses scandal I am issuing provisional figures today and I estimate that last year, despite sharp rises in rail fares, I have cut my overall costs by almost 18%. I may even achieve 20%.

Here are the details:-

• Communications Allowance – Nothing claimed. Saving £8,000
• Staff wages including NI, pensions etc – £64,000. Saving £13,000
• Office running costs – £20,000 Saving £5,000
• London Additional Costs – £21,700 £1,000 saving on last year and almost £3,000 below maximum.
• Mileage – about £4,000 (not finalised) Same as last year
• Rail – £16,000 (Estimate) UP £4,000 partly because of increased rail fares and also because of special disability assistance funded by the House of Commons.

I stress that these are provisional figures but I do not expect the final total to be out by £2k-£3k either way. I have done it by concentrating on the essential things I and my office have to do.

• We have restructured the office to achieve cost efficiencies.
• I have kept car mileage, in the largest constituency in England, in check
• I have implemented our report recommendation of no furniture purchases.
• I have implemented the Conservative Party policy of not claiming for Communications Allowance.
• I have purchased from my own pocket and ironing press and carpet steam cleaner so that I can save £1,000 on professional cleaning bills.

With all these changes I am fairly certain that my total operating costs for last year will be down from £155,000 last year (This was about middle of the pack of all MPs) to under £130,000 when all the figures are reconciled.

I will shortly look at my old operating costs and I have volunteered to be one of the first to take them to David Cameron’s scrutiny committee and will repay anything they think excessive.

Therefore, when in my Budget speech of 22^nd April I said that the Government was delaying cutting spending and should do it now, I had already done it. No doubt there will be criticism if I bought a kettle from Peter Jones instead of Argos and I will have to defend that but I can say to all my constituents that when the country is broke and we all have to make savings, that I already have started and am trying to put my mouth where their money is.

I am looking at my budget for this coming year and I am determined to make a further 10 % saving. If all government departments cut their costs by 30% in two years then we would soon reduce our terrible debts.”

12th May 2009 “I support Cameron’s expenses plan” – David Maclean
 
Member of Parliament for Penrith and the Border, David Maclean, says he strongly supports David Cameron’s tough new plan to be ruthless on all Conservative MP’s over expenses claims.  He has also volunteered to submit his past expenses to the special new scrutiny committee for checking, even though they have not been challenged yet.

Speaking from Westminster he said, “Last year a senior Labour MP, a Lib Dem MP and I worked very hard for six months inventing a new, streamlined and fairer allowances system that was cost neutral to the taxpayer and Members of Parliament.  It abolished the John Lewis list among other radical reforms.  David Cameron put a 3 line whip on it to try to vote it through.  But Labour put on a 3 line whip against the reforms going through and we lost.  I fought for those reforms at the time and I regret that they did not go through.  Now we must, whether justified or not, bare the complete loss of our reputations from this expenses scandal.  I therefore support David’s initiative that we have to go way beyond the House of Commons rules and submit ourselves to further scrutiny, above and beyond what is legally necessary.  I am therefore going to look out my past expenses claims which have all been approved by the House of Commons authorities and ask the scrutiny committee to look at them.  If they say that anything I have legitimately claimed is in their opinion unreasonable or excessive then I shall pay it back.

For the record, my quad bike and electric wheelchair is owned by the House of Commons authorities and I have the use of it so long as I am an MP.  Nevertheless, if the new committee thinks this is excessive I shall give them up.

These steps are all essential until Christopher Kelly reports on a new allowances scheme and he will have to do what has been lacking in the criticism of the last few days i.e. suggest a workable alterative.  We have to spend almost half our working lives in Westminster, every suggestion on how the cost of that should be covered has been rejected by media critics.  At some point, someone will have to invent a system which will be regarded as fair to the taxpayer and to MP’s so that Members of Parliament will be able to do their work in the constituency and also go to London to fight for our constituencies there.”