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April 19, 2013 / politicsbitesize

MPs’ ‘housing benefit’

Wordle-of-MPs-expenses-002Under the Coalition government the welfare system is in the throes of the first overhaul since the 1940s.  Hundreds of thousands of households across the UK face the prospect that any benefits they may be in receipt of will take a hit thanks to new measures implemented in April 2013.

Needless to say, the cap on benefits, the ‘bedroom tax’ and the cut to council tax benefit has been met with fierce resistance. Many of the opponents of the measures designed to reduce government spending, and therefore the UK’s deficit, have called the policies an assault on the poorest in society.

The Government asserts that at present the housing benefit bill of £21bn is a waste of taxpayers’ money.  It is an argument that many have agreed with, but the message misses the point.  Many housing benefit recipients are in work but the wages they get are so low that they are unable to afford the high rents that private sector landlords are allowed to charge.  So, instead of slashing the housing benefit bill by imposing the under-occupancy penalty (‘bedroom tax’), another solution, beneficial to all but the landlord, would be to control rental prices.

There is another drain on the UK taxpayer, however, that hasn’t been addressed under the ‘housing benefit’ umbrella and that is the Accommodation Expenditure budget.  According to the Independent Parliamentary Standards Authority (IPSA), this budgets is ‘designed to meet the costs of overnight accommodation necessarily incurred in the performance of an MP’s parliamentary functions’ but ‘in practice, this means that eligible MPs can choose to claim rental expenditure in one location (either London or their constituency) or claim hotel costs’.

IPSA consulted with MPs in November 2012 and has delivered the findings in its paper, Review of the MP’s Scheme of Business Costs and Expenses.   The document outlines the cost, to the taxpayer, of MPs’ expenses in the areas of accommodation, travel and subsistence. It informs the reader that, ‘MPs who choose to rent in the London Area can claim up to £20,000 per year for their rental payments and other specified associated expenditure’.

The figure of £20,000 pa to cover rent is a handsome sum and to make it available to those with an average annual salary of £65,738 seems a little rich! This ‘housing benefit’ or subsidy was claimed in 2011-2012 by 320 MPs and, according to the IPSA review, the total value of these claims was a little over £4.6m.  Added to this figure are the 366 MPs who claimed council tax expenses, which equates to a cost of nearly £380,000.  In total then, nearly £5m was claimed in housing and council tax ‘benefit’ by MPs whose salaries are already paid by the taxpayer.

Politics:bitesize believes that opponents to the current wave of policies designed to cap benefits should start to protest against this waste of taxpayers money.  It would be liberating to hear a call at the upcoming People’s Assembly event for ALL MPs to live off their very generous salaries and to pay their OWN rent and council tax instead of relying on handouts from the state!

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