The Cost of MPs

There has been widespread consternation at the Independent Parliamentary Standards Authority’s move to increase MPs salary 11% up to £74,000 for the next Parliamentary election.  I don’t think many people could justify such a massive pay rise in the current economic climate – especially in a week where our Chancellor is introducing billions of pounds worth of public service cuts and planning to raise the pension age earlier than previously planned.

It’s always going to be a thorny issue; how much we pay the Members of Parliament that are so loathed by so many.  They are among the most important public servants, and deserve a fair wage for the level of decision-making and work they have to do – but should they be treated as though they are above other public servants in such a time of austerity?  My opinion, which I’d envisage many would agree with, is that they should not.

Currently, MPs earn a wage of £66,396 per year in addition to the ability to claim expenses for purchases and payments related to their duties.  Of course, these expense claims have come under intense scrutiny over the last few years as some MPs have been making ludicrous claims or even false ones – but they still exist.  Personally, I think as things stand that the current salary is reasonable, but the expenses system does still need a radical overhaul.

£66,000 per year is over double the average salary in the UK, which stood at £26,664 in January.  ONS statistics put this MPs salaries above that of air traffic controllers, senior police officers and managers, directors and senior officials.  MPs still earn only half as much as chief executives and most directorships though, and when you consider that MPs are in essence the chief executives of the country, some would say that this isn’t fair in some ways.  Indeed, a YouGov survey of MPs in January suggested they believe their salary should be £86,250.

IPSA is taking on board this desire in proposing their 11% increase, but at the same time say that in 2015 that they will tie increases in salary to the UK’s national earnings.  Why is this not being done now if it is a policy that MPs, the public and themselves agree upon?

Personally, I would set MPs salary at two and a half times the average national salary.  Judging by figures above, that would be £66,660; a slight pay increase on the current salary, and well within the 1% public pay rise cap (and coincidentally including the digits of the devil. – you are welcome to check the sums yourself to ensure that fact is serendipity).  This means that MPs’ salaries are related to the economic success of the country, which is the duty of MPs to ensure.  I can’t think of a more fair way of rewarding MPs for their efforts.

The expenses system is necessary, but needs to work in a way that is practical and taxpayer-friendly.  Travel for official business, meaning between constituency and Westminster (and perhaps to a second official home close to London), should be claimable – but only at the cheapest rate available.  Whether this is at the rate of a Megabus or train journey, MPs should only be able to claim the cheapest way of fulfilling their journey.  They can choose to pay extra themselves for the comforts of first class if they want to, but out of their own pocket.

Limits should be imposed on staff and office costs that are related to the budgets of small businesses with a similar number of employees.  For some MPs this may be an increase on what they currently spend, and for some a reduction.  At least it will then be grounded in reality.

Expenses aren’t for lifestyle choices.  We shouldn’t be funding MPs shopping bills, cars or any other personal purchases.  The idea of a salary is a recompense for work done with expenses being recompense for purchases made that are essential for work.  If MPs can follow this simple logic, they will be on their way to building a fairer system for themselves that will attract more support from their constituents.

MPs should be funded to do their job, and be able to do it well, but it should be done in a way that provides value for money – which the current system does not.

The Scottish Parliament is an example the Westminster parliament could perhaps follow when it comes to paying its’ members.  The salary at Holyrood is £53,091, which is at a comparable level to MPs at Westminster in taking into account the job being performed but also the scale to which they are taking decisions.  There is currently a fixed relationship between MSP and MPs pay, but today Alex Salmond has pledged that this will not continue if MPs’ salaries do rise by 11%.  For reference, The table below shows the salaries of Holyrood and Westminster members in their differing roles:

Scotland UK Extra
Member £53,091 £66,396 25%
Cabinet Minister £92,988 £134,565 45%
Speaker/Pres. Officer £92,988 £142,162 53%
Prime/First Minister £129,998 £142,500 10%

However – unlike at Westminster – MSPs’ office, staff and constituent ‘surgery’ costs are capped at £60,700.  This is a much more reasonable limit than for MPs, which are unlimited, but at the discretion of IPSA.  Travel is covered at a fixed rate per mile, instead of allowing members to choose how they travel freely and expect to be reimbursed.  One striking difference is that the Scottish Parliament will not fund second homes nearer to the Parliament for MSPs to use, because of Scotland being smaller than the UK, but instead offering an allowance to MSPs where it is unreasonable for them to return to their constituency between days of work in Edinburgh.  The measures from the Scottish Parliament are much fairer to the taxpayer, and still allow MSPs to perform their duties and receive proper financial recompense for it.

Politics on this country is suffering from wide scale apathy from the electorate, and sensible restrictions on MPs salaries and expenses are one of the many ways in which Parliament can begin to rebuild their tarnished reputation.  Although MPs are currently coming out against IPSA’s proposals for a pay rise, whether they will shun them and rein in their salaries in line with their policies in other areas is still to be seen.

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