Clause 10 - Expenses of elected representatives

Part of Finance Bill – in a Public Bill Committee at 2:45 pm on 16 May 2013.

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Photo of Sajid Javid Sajid Javid The Economic Secretary to the Treasury 2:45, 16 May 2013

I thank the hon. Lady for her support for the clause. She speaks with experience as a former MSP. Clause 10 provides for the income tax treatment of certain expenses paid or reimbursed to Members of the devolved Administrations in Scotland, Wales and Northern Ireland under their respective expenses schemes. For the main part, the changes introduced by the provisions continue the long-standing concessionary tax treatment that previously applied to similar expenses. They are necessary to reflect the fact that HM Revenue and Customs can no longer apply concessionary treatment and must instead either withdraw or codify all such arrangements.

As with Members of this House, a Member of the devolved Administrations has to perform duties in both their constituency or region and their Parliament or Assembly. The exemptions introduced in the clause are therefore required in order for those Members to carry out their parliamentary or Assembly functions effectively.

The clause codifies elements of the long-standing concessionary tax treatment that has been applied to certain UK travel expenses because Members are required to carry out their duties in both their constituencies and in their Parliament or Assembly. However, while the concessionary treatment applied to all travel within a Member’s constituency, the clause does not allow tax relief for journeys between a Member’s home and their main constituency office.

That is in line with the treatment both of Members of this House and ordinary employees for whom there is no tax relief available for ordinary commuting. That restriction will apply only to journeys to a Member’s main office. That ensures that Members who represent large constituencies, such as that of my hon. Friend the Member for Penrith and The Border or hon. Members from Scottish constituencies, are not unfairly disadvantaged simply because they need more than one office to serve their constituents effectively.

The clause also introduces a new statutory exemption for reimbursed travel expenses incurred by a spouse or partner who shares caring responsibilities with the Member for travel between the constituency home and the Member’s parliamentary home. That is also in line with the treatment for Members of this House. The hon. Lady asked about caring responsibilities and whether the Government had plans to broaden the definition. I am not aware of any plans, but she makes a good point and I will consider it further.

In conclusion, the changes introduced by the clause place the tax treatment of travel expenses received by Members of the devolved Administrations on a statutory footing and bring them more broadly into line with the treatment of travel expenses for Members of this House.