United Kingdom parliamentary expenses scandal

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The United Kingdom parliamentary expenses scandal was a major political scandal triggered by the leak and subsequent publication by the Telegraph Group in 2009 of expense claims made by members of the United Kingdom Parliament over several years.[1] Public outrage was caused by disclosure of widespread actual and alleged misuse of the permitted allowances and expenses claimed by Members of Parliament (MPs), following failed attempts by parliament to prevent disclosure under Freedom of Information legislation. The scandal aroused widespread anger among the UK public against MPs and a loss of confidence in politics. It resulted in a large number of resignations, sackings, de-selections and retirement announcements, together with public apologies and the repayment of expenses. Several members or former members of the House of Commons, and members of the House of Lords, were prosecuted and sentenced to terms of imprisonment. The scandal also created pressure for political reform extending well beyond the issue of expenses and led to the Parliament elected in 2005 being referred to as the 'Rotten Parliament'.[2][3][4]

In the United Kingdom MPs can claim expenses, including the cost of accommodation, "wholly, exclusively and necessarily incurred for the performance of a Member’s parliamentary duties".[5] A February 2008 Freedom of Information Act request for the release of details of MPs' expenses claims was allowed by an Information Tribunal. The House of Commons Authorities challenged the decision on the grounds that it was "unlawfully intrusive".[6] In May 2008, the High Court (England and Wales) ruled in favour of releasing the details of MPs' expenses claims.[7][8] In April 2009 the House of Commons authorities announced that publication of expenses, with certain information deemed "sensitive" removed,[9] would be made in July 2009.[10]

However before this could take place, a full uncensored copy of the expenses records and documentation was leaked to The Daily Telegraph, which began publishing details in daily instalments from 8 May 2009. These disclosures dominated the British media for weeks, with the findings being considered to show flagrant and sometimes gross misuse of the expenses system for personal gain by many MPs (including Government and shadow cabinet ministers) across all parties.

On 18 June 2009 the details of all MPs' expenses and allowance claims that were approved during the period 2004 to 2008 were published on the official Parliament website. However items of detail such as addresses were redacted, and the publication excluded claims that were not approved for payment by the Commons authorities as well as any correspondence between MPs and the parliamentary fees office. These omissions resulted in further accusations of unnecessary secrecy,[11][12] and widespread assertions that the most serious abuses would not have come to light had the censored documentation been the only information available.[9] Details of voluntary repayments by MPs amounting to almost £500,000 were also officially published.[13]

A panel was established to investigate all claims relating to the second homes allowance between 2004 and 2008. Headed by former civil servant Sir Thomas Legg, the panel published its findings on 12 October as MPs returned to Westminster following the summer recess. Each MP received a letter stating whether or not he or she would be required to repay any expenses claimed.

It was announced on 5 February 2010 that criminal charges would be prosecuted against Labour MPs Elliot Morley, David Chaytor and Jim Devine, and Conservative peer Lord Hanningfield in relation to false accounting.[14] On 11 March all four announced they would plead not guilty to charges of false accounting.[15] Potential cases against other unnamed MPs and Lords are still being considered by the police and the Crown Prosecution Service as of December 2010.

The Crown Prosecution Service announced on 19 May 2010 that Labour MP Eric Illsley would be charged with three counts of false accounting; he was also suspended from the Labour Party. Lord Taylor of Warwick, a Conservative peer, had also been charged with six counts of false accounting. On 13 October 2010 it was announced that former Labour MP Margaret Moran would also be charged with false accounting, while on 14 October 2010 former Minister of State for Europe and Labour MP Denis MacShane was referred to the Police following a complaint from the British National Party, as a consequence of which he was also suspended from the Labour Party.

Three Labour Peers were suspended on 18 October 2010 due to their expenses claims: Lord Bhatia was suspended from the House of Lords for eight months and told to repay £27,446; Lord Paul suspended from the House of Lords for four months and ordered to pay back £41,982 and Baroness Uddin faces a police investigation for alleged fraud for claiming at least £180,000 in expenses by designating an empty flat, and previously an allegedly nonexistent property as her main residence. She was suspended from the House of Lords until the end of 2012 and required to repay £125,349.

Background and legal proceedings[edit]

Heather Brooke in May 2012

In January 2005, the Freedom of Information Act 2000 came into force, allowing members of the public to request disclosure of information from public bodies. One early request came from the journalist Jon Ungoed-Thomas. Another request came from journalist and freedom of information campaigner Heather Brooke. All three asked for details of the expenses claimed by certain MPs to be released.[16] The requests were subsequently passed over to the Information Commissioner, who joined the three journalists' cases together and ordered the release of some information on 15 June 2007.[17] House of Commons authorities objected to this order in June 2007 and MPs had, in May 2007, voted in favour of the Freedom of Information (Amendment) Bill which sought to exempt MPs from the 2000 act. The House of Commons voted 96 to 25 in favour of the Exemption of the House of Commons amendment[18] but the bill was ultimately withdrawn prior to second reading in the House of Lords because peers were unwilling to sponsor the bill.[19][20]

In February 2008, after referral to an Information Tribunal, it was held that Commons authorities would release information on 14 MPs.[21] This decision was subsequently appealed against, delaying the release of information.[22][23]

In the tax year 2007–2008, MPs' costs of staying away from their main homes was limited to £23,083.[24]

In January 2009, Harriet Harman, Leader of the House of Commons, tabled a motion which would exempt MPs' expenses from being disclosed under a Freedom of Information request, in order to prevent any further disclosure of information.[25] Labour MPs were placed under a three line whip in order to force the motion through the Commons. However, opposition parties stated they would vote against the proposals, and large-scale public opposition emerged. The proposals were ultimately dropped on 21 January 2009. The Commons authorities announced that full disclosure of all MPs’ expenses would be published on 1 July 2009.[20]

Ultimately the media disclosure made the legal appeal moot; the appeal was finally heard at the High Court, which ruled on 16 May 2008 in favour of releasing the information.[7] No appeal was lodged against the High Court ruling, and the requested details were made public on 23 May 2008.[26]

Pre-publication controversies[edit]

Prior to The Daily Telegraph's revelations in May and June 2009 and the official publication of expenses claims in June 2009, and during the Freedom of Information cases, there were a variety of exposés that covered the controversial John Lewis List (a list considered to indicate amounts that could be claimed without question) and individual MPs’ expenses claims.[20] Examples of items publicised prior to the May 2009 disclosures included:

Information disclosed by The Daily Telegraph[edit]

In May 2009, two months prior to the official disclosure of full expenses claims, The Daily Telegraph obtained a full copy of all expenses claims. The Telegraph began publishing, in instalments from 8 May 2009, certain MPs' expenses.[35] The Telegraph justified the publication of the information because it contended that the official information due to be released would have omitted key information about re-designating of second-home nominations.[36]

The information in the leaks published by The Daily Telegraph originated from the parliamentary fees office, and had been offered to other newspaper organisations for more than £150,000.[37] In September 2009, the assistant editor of the Telegraph, Andrew Pierce, revealed in an interview that the newspaper had paid £110,000 for the information, and described it as "money well spent in the public interest". The Times and The Sun had turned down an offer to buy the leaked expenses file.[38]

Shortly after the publication of the information, the House of Commons authorities asked the Metropolitan Police to investigate, a request that the Metropolitan Police declined, on the grounds that a prosecution would not be in the public interest.[36][39]

Areas of abuse[edit]

Alongside specific allegations of incorrect claims such as claims for the cost of mortgages which it transpired had already been repaid in full[40] the Telegraph alleged[41][42][43] that parliamentary “Green Book” expenses rules[44] gave wide scope for a number of abuses, especially those related to costs of maintaining two residences, one in the constituency and one in London. Areas of questionable claims highlighted by the Telegraph included (but were not limited to):

Specific claims[edit]

The Telegraph firstly revealed expenses of the governing Labour Party, beginning with the Cabinet on 8 May 2009, before releasing details of the claims by junior ministers and Labour backbenchers. Further allegations were made on 14 May.

On 11 and 12 May, publication focused on the frontbench of the Conservative Party.[71] followed by the claims of backbench Conservative MPs whom the newspaper dubbed "the grandees" of the party.[72] On 12 May, the Leader of the Opposition, David Cameron, announced that all questionable claims by the Shadow Cabinet would be repaid.[73]

The Liberal Democrats expenses were revealed last of the three main parties.[74] followed by Sinn Féin members' claims in which it was reported that the five Sinn Féin MPs together had claimed nearly £500,000 in second home allowances, despite never taking up their seats at Westminster due to the party's abstentionist policy.[75][76] Sinn Féin stated that its members often have to travel to London on parliamentary business.[76]

The claims published by The Daily Telegraph ultimately covered the entire gamut of Parliament—all major parties and several minor ones, ministers (including the Prime Minister Gordon Brown, the Chancellor, cabinet and shadow cabinet members) through to backbenchers, and members of both the House of Lords and the House of Commons. A number of members were expelled from their parties, or would not stand for re-election; some members repaid, in part or whole, sums they had previously claimed. Expenses claims to be repaid averaged £3,000[77] with the highest repayment being £42,458.21 by Barbara Follett. There were also payments to the UK tax authority for taxes on possible gains or income previously not paid.[78]

Source of information[edit]

Former SAS officer Major John Wick, the owner of a London based risk management company[79][80] has been named as the middle-man for an unnamed whistleblower; he has spoken of the need to bring the information he had been given into the public domain.[81] Wick stated that:

The person on the end of the line told me he had a hard drive which contained details of every MP's expense claims over the past four years. Every receipt, every claim and every piece of correspondence between MPs and fees office staff was detailed—some four million separate pieces of information [...] those directly involved in processing the raw data were shocked and appalled by what they were seeing.[80]

I was also being told that critical information—particularly the removal of addresses from the files—would lead to many of the scams never being publicly exposed. The ultimate source was adamant that the key thing was that both the information and the way in which it was handled should be in the public domain and that its release was in the public interest [...] I was assured that the data was not stolen but that it was an unregistered copy that had been produced as a result of the lax and unprofessional security procedures.[80]

Wick went on to explain that following legal advice and review, and soul searching over loyalties, he had felt the matter was of sufficient concern to merit publication in a "serious newspaper", and following discussions with a number of papers, the Telegraph had been granted exclusive access to study the material for 10 days from 30 April 2009.[80]

There is an unresolved issue with the data itself, with different numbers being cited by different sources. The Telegraph stated that 4 million pieces of information existed; The Guardian states there were 2 million ("two million documents in all, including copies of expense claim forms, handwritten comments scrawled in margins, even attached sticky notes").[82]

Media handling[edit]

In May 2009, major national newspapers such as The Times described the resulting controversy as "Parliament's darkest day"[83] and a "full blown political crisis",[84] reporting upon cross-party firings and resignations, an exodus of shamed MPs,[83] the prospect of criminal[85] and tax evasion[86][87][88] charges, and a motion of no confidence being prepared against the Speaker.[89]

Public interest in the expenses debate led to the 14 May 2009 edition of the BBC political and current affairs television programme Question Time recording its highest viewing figures in its 30 year run, of 3.8 million, with audience members heckling guest panellist Margaret Beckett. The following week's edition on 21 May was brought forward for a special edition into the prime time slot of 9 pm BST.

Nadine Dorries, a Conservative MP, criticised the Telegraph's handling, which she described as "picking off a few MPs each day, emailing at noon, giving five hours to reply, recording the conversation, not allowing them to speak, telling them they are going to publish anyway".[90] She stated that the stress felt by some MPs was akin to "torture". Her comment was rejected by senior Conservatives. (See also Effect on MPs and on the political structure below)

Impact[edit]

A widespread public reaction was heightened as a result of several factors: the incident broke in the face of an economic recession and financial crisis, under an already unpopular government,[91][92] only weeks before the 2009 European Parliament elections.

Political response[edit]

Following the publication of expenses politicians from all parties responded to the controversy.

Resignations and disciplinary action[edit]

Resignation of the Speaker[edit]

The resignation of Michael Martin, Speaker of the House of Commons, followed after he was pressured to step down for approving the allowances system that MPs have manipulated with questionable claims of expenses. The pressure and viable threats of a proposed vote of no confidence in Martin ultimately forced his resignation.[105] Michael Martin’s response to the handling of the expense crisis was not well received by the majority of the House. He attacked MPs in Parliament who defended The Daily Telegraph for publishing details of expenses and allowances. Martin then concluded his part in the debate over how to handle the expense scandal, by announcing that the Commons clerk had referred the matter of the leaked information to the Metropolitan Police Commissioner. Overall, Martin appeared to be more concerned with the nature of the leak of the information, which led to The Daily Telegraph’s publishing details of MPs expenses and allowances, rather than offering an anticipated apology or explanation. The majority of the MPs felt Martin’s defensive approach and attacks on various MPs as whistleblowers and the backbenchers was a clear indication that Martin was no longer able to lead the House with the required impartiality. MPs from his own majority party, Labour, and the minority opposition party, the Conservatives, felt he had lost the confidence of the public and the House in general.[106][107][108] Martin was the first Speaker to be forced out of the office by a motion of no confidence since John Trevor in 1695.[109] Despite apologising to the public on behalf of the House of Commons on 18 May,[110] Michael Martin announced his resignation as Speaker of the House of Commons and as Member of Parliament for Glasgow North East the following day, both effective 21 June.[111]

Cabinet and Ministerial resignations[edit]

Labour backbenchers[edit]

The Labour Party formed a three-person panel of its National Executive Committee (NEC) in order to investigate some of its MPs who were referred to it over expenses allegations, which quickly became known as the "Star Chamber" (a reference to the court of the same name employed by English monarchs to dispense summary justice in the 16th and 17th centuries).[117] Individual cases (in alphabetical order) include:

Conservatives[edit]

Peers[edit]

Creation of the Independent Parliamentary Standards Authority[edit]

On 20 May 2009 Harriet Harman announced the creation of the Independent Parliamentary Standards Authority, intended to manage Members' expenses at an "arm's length" from the House, ending the historical self-policing by MPs of their expenses. The IPSA will be responsible for: paying MPs’ annual salaries; drawing up, reviewing, and administering an MPs’ allowances scheme; providing MPs with publicly available information relating to taxation issues; preparing the MPs’ code of conduct relating to financial interests; and determining the procedures for investigations and complaints relating to MPs. Henceforth, there will therefore be two codes of conduct for MPs to follow: a non-statutory code drawn up by the House of Commons itself; and a statutory code drawn up by the IPSA. The IPSA will take over some of the functions previously undertaken by the Fees Office. It will not, however, determine the level of MPs’ pay. That will remain a matter for the Senior Salaries Review Body which annually informs the Speaker of the House of Commons of the percentage increase to be awarded to MPs.

Surge in independent candidates[edit]

A surge in proposed independent candidates and enhanced profile of minority parties were noted in the press.[149] In various cases these candidates stood in recognition of the loss of public goodwill suffered by established MPs and parties, and proposed to stand on "clean slate" or anti-sleaze platforms.[150] In the immediate aftermath of the revelations, a Populus survey said that only 45% of people were committed to voting in the next general election (although 54% said they wanted an election as soon as possible), which had fallen by around a quarter since before the disclosures began. The Conservatives still maintained their lead over Labour, but support for the BNP was up.[151] The poll showed that 19% of voters were prepared to vote outside of the main three parties, with the British National Party, Green Party of England and Wales, and United Kingdom Independence Party also hoping to capitalise, and was particularly pertinent because of the subsequent European Parliament election.[152]

Effect on MPs and on the political structure[edit]

The expenses disclosures were published over an extended period of time, with the focus moving to different MPs daily. As a result there was significant pressure on MPs who did not know whether, and for what, they would be discussed, as well as a general deepening hostility that grew over a relatively long period.

On 22 May 2009 Nadine Dorries, the Conservative MP for Mid Bedfordshire went on record in saying that many of her colleagues "feared a suicide" and that MPs were "beginning to crack". She likened the atmosphere in Westminster to that surrounding Senator Joseph McCarthy's "witch hunts" of suspected Communists during the 1950s.[153] The comment led to a forceful rebuke by Conservative leader David Cameron, who stated that the anger and mood were warranted and that MPs should be more concerned about what the public were thinking.[154][155]

On 23 May 2009 the Archbishop of Canterbury Dr. Rowan Williams warned about the potential effect of the controversy on the democratic process, and that "the continuing systematic humiliation of politicians itself threatens to carry a heavy price in terms of our ability to salvage some confidence in our democracy."[156] On the same day writing in The Times, columnist and former MP Matthew Parris reflected that "extravagance, genuine mistake, sly acquisitiveness and outright criminal fraud are now jumbled together in the national mind as though there were no moral differences".[157]

On 11 June 2009 ex-communities secretary Hazel Blears, who chose to resign from the government just before the English county council and European elections, said that she regretted the timing of her decision. She also stated that her decision to wear a brooch with the words 'rocking the boat' on the same day as the resignation was a "stupid thing to do". Speaking to the Manchester Evening News she said of the brooch "It was a brooch my husband had given me. I'd had four weeks of intense media pressure, the like of which I have never known, not just on me but on my husband, my dad, my family. At that point I'd had enough. It was a stupid thing to do but I think it was just trying to put a brave face on—not going out cowed on the basis of expenses claims that genuinely are not true."[158]

Reform proposals[edit]

On 25 May 2009, Health Secretary Alan Johnson (seen as a possible candidate for Labour leadership) stated that one response to the controversy should be a full review of the electoral and political system. He proposed as part of this, a referendum on changing the electoral system to Alternative Vote Plus.[159]

David Cameron, the Conservative Party leader of the opposition, set out his proposal for reform in The Guardian.[160] He proposed strengthening the power of backbenchers over the government, and other measures as part of 'a radical redistribution of power'. Writing in the Guardian on 27 May 2009, Liberal Democrat leader Nick Clegg suggested cancelling MPs holidays until 'the constitutional crisis sparked by the row over expenses is resolved'.[161] Setting out a week by week plan Clegg made wide ranging proposals from placing a cap on individual donations to political parties, to replacing the House of Lords with an elected Senate, to allowing a referendum on electoral reform.[162]

The major political parties and some minority parties (not UKIP) have stated they will publicly disclose information on expenses claims by UK Members of the European Parliament. The proposed disclosures vary between parties.[163]

A study of the possible influence of the voting system on MPs behaviour concluded that those MPs with the safest seats were twice as likely as those with the most marginal seats to be involved in the expenses row.[164]

Police and tax authority responses[edit]

The UK tax authority HM Revenue and Customs (HMRC) has identified around 40 MPs, including the former Chancellor of the Exchequer, as having claimed for their tax return costs. A minority of these have affirmed they paid tax on the sums involved; HMRC have confirmed they are investigating former Chancellor Alistair Darling's tax claims, along with those of others involved. Darling had claimed the costs of preparing his tax return as an expense of his office, although tax law regards them as personal costs. Lord Millett, a former Law Lord, described Darling's claim as "astounding",[165] and guidance to ministers in 2005 had stated that such expenses were not claimable for tax purposes.[59]

The Economic and Specialist Crime branch of the Metropolitan Police Service have started investigating claims made by a few MPs.[166]

Criminal charges[edit]

See also: R v Chaytor

Keir Starmer, Director of Public Prosecutions for England and Wales announced on 5 February 2010 that three Labour MPs, Elliot Morley, David Chaytor and Jim Devine, and Conservative peer Lord Hanningfield would face criminal charges of false accounting (s. 17, Theft Act 1968) in relation to their expense claims. He said that the Crown Prosecution Service had concluded that "there is sufficient evidence to bring criminal charges and that it is in the public interest to charge the individuals concerned".[121][122] All four denied wrongdoing and said they would fight the charges. A joint statement from Morley, Chaytor and Devine said "we totally refute any charges that we have committed an offence and we will defend our position robustly", while Hanningfield said "all the claims I have ever made were made in good faith".[146][167]

David Chaytor[edit]

David Chaytor (Labour) appealed along with Jim Devine and Elliot Morley to the Supreme Court of the United Kingdom that his actions were protected by parliamentary privilege. The Supreme Court ruled against them and he subsequently pleaded guilty to charges of false accounting, and was sentenced to 18 months imprisonment.[168]

Jim Devine[edit]

Jim Devine (Labour) pleaded not guilty and was found guilty on two counts but cleared of a third (relating to £360) on 10 February 2011.[169] On 31 March 2011 he was sentenced to 16 months imprisonment.[128]

Eric Illsley[edit]

Eric Illsley (Labour) pleaded guilty to charges of false accounting and was sentenced at Southwark Crown Court to 12 months imprisonment.[170]

Denis MacShane[edit]

Denis MacShane (Labour) was jailed for six months on 23 December 2013 for expenses fraud, after admitting submitting 19 fake receipts amounting to £12,900, making him the fifth MP to get a prison sentence as a result of the scandal.[171]

Margaret Moran[edit]

Margaret Moran (Labour). On 6 September 2011 the Crown Prosecution Service (CPS) announced that Moran would face 21 criminal charges[172] 15 of false accounting and six charges of forgery. She was summoned to appear at Westminster Magistrates' Court on 19 September 2011 where she was reported to have wept throughout the hearing.[173] Moran was sent to the Crown Court at Southwark for trial on 30 October 2011. She failed to appear and a 'not guilty' plea was entered by default in her absence. A date for the trial of an issue was set for 18 April with a directions hearing set for 15 December.[174] On 15 December 2011 Mr Justice Saunders was informed that psychiatrists considered Moran unfit to plead with the defence contending that the trial should therefore not proceed.[175] In April 2012, after receiving evidence from a number of psychiatrists, the judge determined that Moran was not fit to plead. On 13 November 2012 a jury found her guilty of the acts alleged.[176]

Elliot Morley[edit]

Elliot Morley (Labour) admitted two charges of dishonesty and was sentenced at Southwark Crown Court on 20 May 2011 to 16 months imprisonment.[177] On 8 June 2011, he was expelled from the Privy Council, the first expulsion since Edgar Speyer in 1921, and thereby stopping him from using the honorific title The Right Honourable for life.[178]

Lord Taylor of Warwick[edit]

Lord Taylor of Warwick (Conservative) pleaded not guilty to six charges of false accounting, but was convicted at Southwark Crown Court on 25 January 2011.[179] On 31 May 2011 he was sentenced to 12 months imprisonment.

Lord Hanningfield[edit]

Paul White, Baron Hanningfield (Conservative) pleaded not guilty to six charges of false accounting, but was convicted at Chelmsford Crown Court on 26 May 2011.[180] He was given a 9-month sentence[181] which was confirmed when his appeal[182] against the conviction and sentence failed in July 2011. As a low-risk prisoner he was released in September 2011 on home detention after serving a quarter of the sentence.[183] After repaying the wrongly claimed £30,254.50 he returned to the House of Lords in April 2012.[184]

Independent audit[edit]

An independent panel chaired by former civil servant Sir Thomas Legg was established following the row, with a remit to examine all claims relating to the second homes allowance between 2004 and 2008.[185] The panel published its findings on 12 October as MPs returned to Westminster following the summer recess, with each MP receiving a letter in which they were informed whether or not they would be required to repay any expenses they had claimed. Among those who had to repay expenses were Prime Minister Gordon Brown who claimed £12,415 for cleaning and gardening costs and Liberal Democrat leader Nick Clegg who was asked to pay back £910 from a £3,900 claim he made for gardening between 2006 and 2009.[186] Conservative leader David Cameron repaid £218 and was asked to provide more information regarding excessive claims made in 2006 when he changed his mortgage.[186] Former Home Secretary Jacqui Smith apologised to the House of Commons after a separate investigation found that she had breached expenses rules over claims made on her second home.[186]

However, MPs from all main political parties expressed their anger at Legg's decision to apply the rules retroactively, a decision which meant claims that had previously been regarded as legitimate were now considered to have breached the rules. Many senior MPs questioned Legg's authority and cast doubt on the legality of his findings.[187] It was reported that some MPs, including Tory Jonathan Djanogly would challenge the requests to repay their claims.[188] But both the Labour and Conservative leaders urged their party members to pay any overpaid expenses back. Gordon Brown said that MPs should "deal with" the retroactive rules,[189] while David Cameron warned that any member of the Conservative Party who was unwilling to comply with the rules would not be able to stand for the party at the next general election.[190]

Awards[edit]

At the 2010 British Press Awards, The Daily Telegraph was named the "National Newspaper of the Year" for its coverage of the MPs expenses scandal, which was also referred to as the "Scoop of the Year". William Lewis won "Journalist of the Year" for his reporting role as well.[191]

See also[edit]

References[edit]

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External links[edit]