March 13, 2008
Is £10,000 too much for a kitchen?
Expect some over-excited coverage of MPs “John Lewis list” which tells them how much they can spend kitting out their London homes.
The list was published by the Commons’ authorities today under a freedom of information request by Press Association.
The cost of the stuff in question - beds, new kitchens, rugs, dining tables - is not exactly surprising. The prices are the same as you would see at, er, John Lewis.
For an excellent take on the whole “scandal”, it’s worth reading Daniel Finkelstein at The Times.
What is more controversial is the extent of the objects which MPs can claim via their additional cost allowance.
A £10,000 kitchen doesn’t sound expensive to me (I can say that from bitter experience) but why should taxpayers be paying for this in the first place? Or TVs, or dining tables, or £300 rugs?
This state of affairs came about years ago when the allowance was set up to prevent public criticism of an outright pay rise. Unfortunately the opposite has happened.
A committee chaired by Michael Martin, the speaker, will report this summer and is likely to recommend scrapping the allowance and rolling up the £21,110 into MPs’ salaries. This could be unpopular with the public as it looks like a big pay increase. But it’s not before time.
In the meantime, the real story will be when MPs are forced to disclose how they have spent their allowances - in a few days’ time - thanks to a recent decision by the information commissioner. (Unless the House appeals against it, which seems likely).
That will be far more interesting than the theoretical list of what they may or may not have spent. Here, for the record, are highlights from the John Lewis list:
Air conditioning unit: £299.99
Bed: £1,000
Bookcase/cabinet: £500
Coffee maker/machine: £100
Coffee table: £250
Dining arm chairs: £150 each
Dining table: £600
Food mixer: £200
Free-standing mirror: £300.00
Fridge/freezer combi: £550
Gas cooker: £650
Hi Fi/stereo: £750
Installation of new bathroom: £6,335
Installation of new kitchen: £10,000
Recordable DVD: £270
Suite of furniture: £2,000
Television set: £750
Wardrobe: £700
If the allowances paid to an MP are converted into additional salary then MP’s will get a bigger pension when they retire.
An additional £25,000 salary would cost the public purse over a further £9000 more a year in extra National Insurance and pension scheme contributions.
An MP (on the standard salary of £62,000) who managed to last the 27 years required to get a 2/3 pension would end up with a pension £17,000 higher pa than if expenses were paid. (all at today’s values).
No wonder many MPs think this such a simple and transparent solution - I can see through it.
Posted by: Nick Michaels | March 14th, 2008 at 8:47 am | Report this commentIt’s a good point, Nick. But I’m told that if they do roll the expenses into the salary they will change the actuarial basis of the pension system so that MPs don’t benefit further on retirement.
Adding the expenses to the salary will be contentious enough: I’m told it could be a 50 per cent rise to £94,000, to take account of the fact that the expenses are currently tax-free.
Posted by: Jim Pickard | March 17th, 2008 at 11:19 am | Report this comment