CentreRight: Sir Patrick Cormack is just plain wrong

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August 19, 2009

Sir Patrick Cormack is just plain wrong

Guest post from Mark Wallace, TPA Campaign Director

Fresh from his attempt to become Speaker of the House of Commons, Sir Patrick Cormack is in the headlines for advising Sir Christopher Kelly’s Committee on Standards in Public Life to double the pay of MPs in return for abolishing all allowances and expenses.

This proposal would be completely the wrong response to the recent scandal and the current crisis of confidence in Parliament. That is the case for several reasons:

To do so would be to accept the shoddy argument that some MPs behaved greedily and dishonestly because they are poverty-stricken or underpaid. As the TPA laid out in a recent research paper (PDF), MPs are already in the top 3% of earners in the UK, and are among the best paid representatives in Europe (even before taking into account their generous final salary pensions).
The idea that any MP – guilty or not – should be rewarded for the dishonesty of their colleagues is unacceptable to the public and clearly contrary to any sense of justice. If anything, the recent scandal demonstrates that MPs have had too many opportunities for personal enrichment. Legitimising such greedy behaviour does not make it ok, it compounds the problem and insults the public who have a totally different set of rules to live by.
Against the background of a recession in which huge numbers of ordinary taxpayers are losing their jobs, taking pay cuts or accepting pay freezes, a large jump in remuneration for MPs could only harm the already poor standing of Parliament. If the people think you are a bunch of greedy swindlers, the way to prove them wrong is not by demanding an extra £66,000 a year.
If the Telegraph’s revelations have demonstrated one thing, it is that transparency is essential to make sure taxpayers’ money is not being abused. What Parliament should be doing to win back public trust is publishing all expenses claims in full on a regular basis, for all to see. By replacing a system of receipts with a pay rise, Parliament would be choosing opacity and denying the public the right to know anything about how their money is spent.
Sir Patrick conveniently fails to mention the massive knock-on costs of a pay rise due to the various final-salary benefits that MPs enjoy. For a start, they are on final salary pensions – meaning that a doubling of their salary would produce a massive hike in their taxpayer-subsidised pension pots. Furthermore, the parachute payments given to MPs who leave Parliament are also calculated based on length of service and final salary. The windfall from a massive salary hike would be huge.
Replacing travel and accommodation expenses with one pay band would produce an inequitable settlement for different MPs. If you are an MP on the outskirts of London, you will be considerably better off than an MP from Manchester, Glasgow or Cornwall simply because you don’t have so far to travel.
Even if you accept the dubious principle of replacing expenses and allowances with a pay rise, this is a hugely excessive rise. Sir Patrick wants a pay rise of £64,000 to replace a system of expenses from which he claimed £28,201 in 2007/08. That’s doubling the cost for taxpayers, and even after Sir Patrick has paid the extra income tax and NI on that figure a quick calculation would suggest he might be around £10,000 better off.

Posted by Matthew Sinclair at 16:09 | Permalink

Comments

Guest post from Mark Wallace, TPA Campaign Director

This proposal would be completely the wrong response to the recent scandal and the current crisis of confidence in Parliament. That is the case for several reasons:

To do so would be to accept the shoddy argument that some MPs behaved greedily and dishonestly because they are poverty-stricken or underpaid. As the TPA laid out in a recent research paper (PDF), MPs are already in the top 3% of earners in the UK, and are among the best paid representatives in Europe (even before taking into account their generous final salary pensions).
The idea that any MP – guilty or not – should be rewarded for the dishonesty of their colleagues is unacceptable to the public and clearly contrary to any sense of justice. If anything, the recent scandal demonstrates that MPs have had too many opportunities for personal enrichment. Legitimising such greedy behaviour does not make it ok, it compounds the problem and insults the public who have a totally different set of rules to live by.
Against the background of a recession in which huge numbers of ordinary taxpayers are losing their jobs, taking pay cuts or accepting pay freezes, a large jump in remuneration for MPs could only harm the already poor standing of Parliament. If the people think you are a bunch of greedy swindlers, the way to prove them wrong is not by demanding an extra £66,000 a year.
If the Telegraph’s revelations have demonstrated one thing, it is that transparency is essential to make sure taxpayers’ money is not being abused. What Parliament should be doing to win back public trust is publishing all expenses claims in full on a regular basis, for all to see. By replacing a system of receipts with a pay rise, Parliament would be choosing opacity and denying the public the right to know anything about how their money is spent.
Sir Patrick conveniently fails to mention the massive knock-on costs of a pay rise due to the various final-salary benefits that MPs enjoy. For a start, they are on final salary pensions – meaning that a doubling of their salary would produce a massive hike in their taxpayer-subsidised pension pots. Furthermore, the parachute payments given to MPs who leave Parliament are also calculated based on length of service and final salary. The windfall from a massive salary hike would be huge.
Replacing travel and accommodation expenses with one pay band would produce an inequitable settlement for different MPs. If you are an MP on the outskirts of London, you will be considerably better off than an MP from Manchester, Glasgow or Cornwall simply because you don’t have so far to travel.
Even if you accept the dubious principle of replacing expenses and allowances with a pay rise, this is a hugely excessive rise. Sir Patrick wants a pay rise of £64,000 to replace a system of expenses from which he claimed £28,201 in 2007/08. That’s doubling the cost for taxpayers, and even after Sir Patrick has paid the extra income tax and NI on that figure a quick calculation would suggest he might be around £10,000 better off.