House of Lords: Financial Support for Members — Motion to Approve

Part of the debate – in the House of Lords at 3:46 pm on 14th December 2009.

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Photo of Lord McNally Lord McNally Leader in the House of Lords, Spokesperson for Constitutional Affairs , Liberal Democrat Leader in the House of Lords 3:46 pm, 14th December 2009

My Lords, the Leader of the House and the Leader of the Opposition have done the House a service by being so unequivocal in recommending acceptance of this report. The Leader of the House rightly put our debate in the context of the wider issues of conduct, reform and the crisis of confidence that we face in terms of public attitudes to our Parliament.

During the past five years, I have been a member of the Leaders' Group, the Procedure Committee and the House Committee, the main committees responsible to the House for allowances and conduct. Over the past few months, as we have had to deal with the various challenges to the reputation of this House, I have asked myself many times whether we, who were charged with these responsibilities, could and should have acted sooner and with a greater sense of urgency to avert some of the troubles that have beset us. On conduct, I do not think that is true. On the issue raised by the Sunday Times sting, we acted decisively and even rejected the views of an Attorney-General to assert our right to discipline wayward Members. We acted quickly to appoint the Eames Committee, which moved with commendable speed to report. In my view, our acceptance of that report puts matters of conduct and discipline on a clear and transparent basis. I am less sure that we can claim the same about the handling of expenses and allowances.

The truth is that the system that we are in the process of replacing is, to put it at its kindest, cheap and cheerful. Its main benefit was that it allowed Members of modest means to participate fully in the work of this House and also allowed for a greater geographic spread of participation. In short, as the Leader of the House indicated, it prevented the House of Lords becoming the preserve of the rich, the retired and the London-based.

Whatever any strict interpretation of the rules may have said, Members were encouraged by nods and winks to assume that they could claim beyond reimbursement for outgoings and expenditure to provide a little padding. Such rough justice worked well in encouraging men and women in their 40s and 50s to accept working peerages in spite of the fact that such acceptances involved loss of career and salary advancement within their profession as well as a large measure of pension contribution and entitlement.

As that rough justice worked, as it provided a very effective and value-for-money return to the taxpayer and as its cost was not bureaucratic and cost little to administer, perhaps we lost sight of the change in public mood to such arrangements. As the Chairman of Committees reminded us, and as the SSRB bluntly put it, our existing systems,

"lack precision, transparency and rigour" and do not meet current standards for control of public money. Or, as the Lord Speaker put it in her excellent Hansard lecture last Thursday, which I recommend that every noble Lord read:

"having failed to provide any clarity over what has constituted reimbursement for actual expenses and what was an allowance, and having been regulated with the lightest of touches. The system was an accident waiting to happen and happen the accident did".

Whether those of us charged with responsibilities in those matters could and should have acted earlier is a judgment easier to make with hindsight. In June of this year, we did act, as the Chairman of Committees explained, by referring the matter to the SSRB. My group, the Liberal Democrat group, submitted joint evidence to the SSRB which recommended replacing the attendance allowance, office costs and 40-day additional office costs by a single, taxable daily rate for the job. Our evidence also called for a specific and receipted overnight allowance. These changes, we argued, would involve,

"a significant switch in resources used presently for accommodation needs to general financial support".

That being the thrust of our evidence and the outcome of the SSRB deliberations, I hope that my colleagues on these Benches will support what the House Committee has called "the architecture and principles" of the system proposed in the SSRB report. The House Committee also recommends that an ad hoc group of Back-Benchers,

"consider and consult on issues in the ... report and advise on their implementation", and the Leader of the House has set out in her speech some of the topics that noble Lords could submit as ideas to the group.

I support that way of going forward. Like the noble Lord, Lord Strathclyde, I agree that we need to deal with some of the gargoyles in the report, but it would be disastrous if we were to allow it to be thought that by setting up the committee we were giving ourselves some wriggle room on the main recommendations of the report: namely, the £200 daily allowance and the £140 overnight expenses. Those, in my view, are the immovable iron poles of what has been termed the architecture, and voting for the resolution today should mean accepting those figures. We cannot appear to be setting our own rates-in that way lies public condemnation.

What the ad hoc committee can and should do is look at some of the recommendations on overnight expenses so that they are fair and realistic not only to hotel and club dwellers, but to renters and owner-occupiers as well. I hope that it will look also at guidance on travel both for long distance out-of-towners and middle distance commuters. Some of both the wording used and implementing bureaucracy suggested by the SSRB would be more suitable for tagged prisoners on day release than for Members of the House of Parliament.

In the excellent Hansard lecture to which I have already referred, the Lord Speaker cited President Obama's Chief of Staff, Rahm Emmanuel, as advising, "Don't let a serious crisis go to waste". That is good advice. That is why, like the Leader of the House and the noble Lord, Lord Strathclyde, I believe that the ad hoc committee should be bold in looking at how, while accepting the broad architecture of the SSRB, we use the collective wisdom of this House to make sure that we have the accountability and public acceptability which I think acceptance of the SSRB report will bring. However, at the same time, we must not burden the public purse with a bureaucracy whose costs will outweigh any notional savings and which will not reflect the realities of life for an active working Peer.

Retaining and enhancing the reputation of this House is a three-legged stool. The first leg is the Eames report, which, as I said, offers a clear basis of truth and consequences in terms of conduct in this House. The second leg is our response today to the SSRB report. Our message must be that we accept the report and that we are determined to make it work.

The third leg is equally important if the other two are to stand. I do not believe that public patience with this House will long remain if the notional membership is bloated to more than 800 in the next year without at least the very modest proposals suggested by my noble friend Lord Steel making their way into law. The Constitutional Reform Bill seems to be dawdling a suspiciously long time in the Commons. Unless the provisions relating to this House can be enacted before the general election, any notional saving to the public purse will be swallowed up by the cost of new creations, who are bound to be regular attenders. I accept that fundamental reform of this House is for another day and another Parliament, but we must do what we can in the time remaining in this Parliament to tidy up what we can if we are to avoid further public outrage and contempt.

I think I have said before that it is now 43 years since I first entered this Palace seeking my first political job. I did so with a sense of awe for what it is, and what it stands for, and awe I retain to this day. My predecessor on these Benches, Roy Jenkins, once likened public trust to carrying a very valuable glass vase across a highly polished floor. It is our turn to do the carrying. Voting for this Motion tonight will be one step in ensuring that we do not slip.