Tuesday, March 31, 2015

"Benefits Cheats"? But they're within the rules.

JIM MURPHY, MP, Labour's leader in Scotland, first made his name twenty years ago as leader of the National Union of Students, reversing the union's opposition to the abolition of grants and introduction of tuition fees.  His firm hand against opponents led to a Commons Early Day Motion condemning his "intolerant and dictatorial behaviour", signed by 17 Labour MPs, but did him no harm at all with Labour's leadership, assuring Murphy himself a seat in parliament.

Remembering how Murphy betrayed poor students and loyally served Tony Blair's government, the SNP and others are ridiculing the Labour leader's promise to keep university tuition free in Scotland.

But just how keen Jim Murphy is on keeping public spending to the limit and making sure no one is unfairly claiming benefit might be judged against the news that he is one of 46 MPs who have claimed more than £1.3million for rent or hotel rooms at the same time as receiving rent from properties that were often purchased and refurbished from taxpayers’ money.

Labour's leader in Scotland owns a property bought with help from the taxpayer just two miles from the Palace of Westminster, which he let out. Over two years from 2012/13 he claimed £39,372 to rent another London flat for himself.

An investigation by Channel 4 News found 25 Conservatives, 14 Labour and four Liberal Democrats had benefited from an expenses loophole, which is not against parliamentary rules. Many of the MPs bought their London properties with the help of the taxpayer under the previous expenses system that allowed claims for mortgage payments.

Andrew Lansley is the former Tory health secretary whose 'reforms' managed to radicalise the Royal College of Nursing and the BMA against him, though he received a donation of £21,000 from John Nash, the chairman of private healthcare provider Care UK and founder of the private equity fund Sovereign Capital. Lansley has claimed more than £7,440 since 2013 to stay in London hotels, despite owning a flat with his wife in Pimlico, within walking distance of Westminster. The flat was acquired with public help, and though the South Cambridgeshire MP has not rented it out, it is being used by his daughter, who has launched a business there.

MPs used to be able to claim expenses for mortgage repayments. Since the claims were stopped by the Independent Parliamentary Standards Authority (IPSA) following the expenses scandal, the MPs have switched to renting out the properties they own and instead claimed expenses for rent and hotels. Under the current system, MPs are allowed to claim £20,600 a year in London rent and £150 a night for hotels.
Labour’s shadow culture minister Chris Bryant has claimed £35,350 in the past two years to rent a property in London despite already owning a penthouse. He bought the two-bedroom apartment, which has a private lift and porter, in 2005 and claimed around £1,000 a month in mortgage claims.

But when the rules changed he moved into another flat and let out the property he already owned for around £3,000 a month.

Former Liberal Democrat defence minister Sir Nick Harvey has charged the taxpayer £39,772 in expenses for the rent of a flat, despite owning a house in Lambeth which he has let out to tenants since the rule change.

SNP MP Angus MacNeil owns a flat in Lambeth, a short walk from the Houses of Parliament, which was paid for with taxpayer help. But he has claimed £42,177 in hotel expenses om the three years since 2012/13.

Former Chairman of the Committee for Standards in Public Life Sir Alistair Graham said MPs should be seen to be upholding the spirit of the rules that state they must not ‘exploit the system for personal financial advantage’

He told Channel 4 News: ‘It’s not always just about exactly what the rules say. It is about you taking personal responsibility that public funds are used in a proper and appropriate way that your constituents would be comfortable with. I’m sure we will hear all sorts of sob stories about why it’s justifiable to do what they’ve done. But they must know in their heart of hearts that the public will see this as MPs on the make.’

Indeed, when I read about this I was reminded of my own experience some years ago renting a flat on a council estate, one of the less affluent pockets in Pimlico, from a fellow who was the official tenant and, as I found out, receiving housing benefit on top of the rent I paid. Having been unable to get a flat otherwise, and enjoying the novelty of living in central London, I found my "landlord"'s little fiddle amusing, until I found myself out of work and unable to claim help with my rent because he was already claiming.

If I had responded to all the government's expensive propaganda urging us to expose a benefit cheat I could have shopped the guy, I suppose, but that would not have brought me any benefit, nor have advanced my name on the housing waiting list. 

This kind of situation of the poor finding ways to 'rip off' the system by exploiting those who become even poorer, is probably more common than people like to admit, partly because the system has failed to provide reasonable legitimately rented homes to workers who need them.

Now things are much worse.  More than a third of the homes sold through "right to buy" for council tenants are now in the hands of private landlords renting for profit. In some quite poor London boroughs the proportion rises to 50 per cent. The Tories want to extend "right to buy" to Housing Association tenants. Meanwhile Housing Associations are raising rents, more land and housing is falling into the hands of developers, and the obligation to provide "affordable housing" is becoming a sick joke on most ordinary Londoners.


But getting back to those MPs, and former ministers, who are not exactly short of a few bob or having to go to the food bank, there's no point in calling any place to report them as benefits cheats,
because it seems they have not broken any rules.

North Devon MP Sir Nick Harvey said: "This situation is not of the MPs' choosing. MPs have been obliged to let out their own properties since 2010 because the new rules say they cannot claim mortgage interest - only rent. Letting income covers the mortgage and other outgoings and is of course taxed. It is not MPs' fault that the rules compel them to rent a separate flat to live in.
"In some cases this may even cost the taxpayer more than leaving them in their own home. Changes made with the best intentions sometimes have unintended consequences, as you have highlighted."

Ah well. 



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