MP expenses claims 'take too long'

MPs and their staff are spending a "disproportionate" amount of time on expenses claims under the new system introduced following the scandals of 2009, a parliamentary report found today.

The cost of time spent submitting expenses claims is estimated at £2.4 million a year, with 85% of MPs saying that the bureaucratic burden of the new system has eaten into the time they have available to help constituents, said the Commons Public Accounts Committee.

The committee said the Independent Parliamentary Standards Authority should consider scaling back checks on expenses, particularly for small items and low-risk claims, to deliver "a more proportionate and cost-effective approach to validation".

The current scheme is "expensive to run and does not yet demonstrate value for money", with some 38% of claims costing more to process than the value of the sums involved, said the report.

While the total paid out for expenses and staff salaries has fallen by 15% to £118 million since Ipsa's creation - with £19.5 million going on expenses and £98.6 million on salaries - the PAC warned that this may not necessarily represent an efficiency saving.

Some 90% of MPs say that they are using their own money to subsidise their work, because the administrative effort involved in making an expense claim is not worthwhile for small items, it found.

Today's report by the parliamentary spending watchdog found that Ipsa has done "a good job" in introducing the new expenses system on time, making accurate payments and helping improve public confidence.

Some 99.7% of claims made by MPs are within the rules and Ipsa says that rejections are overwhelmingly due to administrative errors rather than attempted abuse.

But the report found there was "significant scope" to improve the cost-effectiveness of the system and warned that MPs were spending "too much" time on claims.

"Ipsa needs to balance its duty to safeguard public money more effectively with its duty to support MPs in undertaking their work," said the committee.

"In addition to the processing costs that Ipsa incurs, there is another important category of cost related to expenses claims: the cost of the time that MPs and their staff spend using the system. To date, Ipsa has not paid enough attention to this substantial cost, nor to the way in which its scheme is hindering MPs in the carrying out of their core duties.

"The cost of an MP or staff member spending time on Ipsa's system is just as much a cost to the taxpayer as Ipsa's own processing costs."

PAC chair Margaret Hodge said: "Ipsa did a good job in introducing the new system for paying MPs' expenses. It came in on time, expenses have been paid within the rules and MPs have been reimbursed accurately. There is evidence that public confidence is starting to improve.

"However, the current scheme is expensive to run and does not yet demonstrate value for money. It is striking that 38% of claims are for less money than the average cost of administering them.

"Ipsa needs to get better at distinguishing between high-value and high-risk claims, which require rigorous checks, and those where the risk of error is low.

"Although there has been a 15% reduction in the amount paid out for MPs' expenses, that cannot be claimed as an efficiency saving while so many MPs report that they are put off from claiming legitimate expenses because the claims process is so bureaucratic."

An Ipsa spokesman said: "We welcome today's PAC report which finds that we have done a good job and that public confidence is increasing, demonstrating the huge progress made in a short time.

"The PAC confirm that we introduced a robust system, that we provide the public with assurance about reimbursement of MPs' claims, and that our work has resulted in a marked improvement in public confidence. Given the public outrage at the abuses of the old system, this is a significant achievement.

"We also welcome the PAC's confirmation that our administrative costs compare well with the other UK legislatures, especially as we are still in the early stages of our operations. We are committed to building on this impressive start and further improving our efficiency and effectiveness."

PA