No one will respect MPs unless they stand up for reasonable payby Peter Riddell / July 18, 2013 / Leave a comment
Published in August 2013 issue of Prospect Magazine
Politicians can never get it right over their own pay and expenses. The decision—after the expenses scandal in 2009—to shift responsibility to Ipsa, the independent regulator, is in danger of backfiring because party leaders ran for cover in the face of a populist outcry from the blogosphere and the press over speculation about a big pay rise for MPs. Ipsa, it is said, is out of touch; now is not the right time for an increase.
But the party leaders are wrong. The Ipsa process and its balanced package offer the best way forward for both MPs and voters. Pay for MPs was introduced a century ago to enable working men to serve in the Commons. The real value of the pay has fluctuated. It has generally lagged behind average earnings when inflation has been rapid, while much has depended on the attitude of prime ministers, who have generally sought to demonstrate that MPs are setting a restrained example. But during the 1980s and 1990s that led to evasion as small increases in pay were offset by a proliferation of allowances, often ill-defined and subject to abuse. That resulted in the expenses scandal, where the damage was caused not just by a few outright crooks but also by the exposure of a deeply flawed system which tainted parliament.
The hurried response was to create Ipsa to handle expenses and pay. The party leaders believed that MPs had lost the trust of voters on anything to do with money. Hence, responsibility was handed to an independent body. However, some heavy-handed initial rules and regulation alienated many MPs, strengthening the position of those who argued that MPs should never have surrendered control in the first place.