MPs' Scheme of Business Costs & Expenses
The MPs’ Scheme of Business Costs and Expenses (‘the Scheme’) is intended to ensure that MPs are reimbursed for costs necessarily incurred in the performance of their parliamentary functions. It sets out a series of fundamental principles and rules within which MPs must operate, while still allowing them appropriate discretion over making claims.
IPSA reviews the Scheme regularly to ensure the budgets and rules are fair and workable for MPs, their staff, and the public. The Seventh Edition of the Scheme came into effect on 1 April
2015 for the 2015-16 financial year, with some of the changes taking effect
after the General Election. The
Sixth Edition of the Scheme only
applies to expenditure incurred up to and including 31 March 2015 in relation
to the 2014-15 financial year.
We have a statutory responsibility to regulate and administer a transparent scheme of business costs and expenses for MPs. Our reviews of the Scheme help ensure that public funds are properly spent and accounted for and that MPs have the support they need to perform their parliamentary functions. As part of each review, we run a consultation seeking the views of the public, MPs and other interested parties about any possible amendments.
For the Seventh Edition of the Scheme, based on the responses we received, as well as the evidence gathered, we considered that only minor adjustments were necessary. IPSA has also reviewed the budget limits to ensure these remain appropriate. IPSA has amended the rules on MPs’ staff pensions to ensure that the Scheme complies with legislation on pension auto-enrolment.
Also available to download above is a Summary of the Scheme. This summary describes the main features of the Scheme and explains some of the rationale behind it. It is not a comprehensive statement of the rules and does not always use exactly the same terminology. It has no status other than an explanatory one and anyone who wants to understand the detail of the rules should refer to the Scheme itself.
This review of the MPs’ Scheme of Business Costs and Expenses (‘the
Scheme’) fulfils our legal requirement to review the Scheme regularly. We have
a continuing commitment to ensure that the Scheme is fair, transparent and
workable. We are
mindful of the need to control costs, while conscious of the need to provide
MPs with the support that they require to carry out their parliamentary
The Scheme’s rules are now widely
understood and observed. This year’s review focused on a small number of
changes to the rules ahead of the General Election on 7 May 2015. We believe
that these changes will help to ensure that the rules remain fair, workable and
transparent into the new Parliament. We have also considered the budget limits
to ensure that these remain at an appropriate level.
As part of this review, we took into
consideration all of the responses we received to the consultation. We are
grateful to all those who took the time to share their views.
The review has resulted in the Seventh
Edition of the Scheme, which will come into effect from 1 April 2015 for the
2015-16 financial year. Some of the changes will take effect from 8 May 2015,
following the General Election.
Sir Ian Kennedy (Chair), Sir Neil Butterfield, Elizabeth Padmore, Anne
Whitaker, Professor Tony Wright.
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Below is a summary of the key
changes made to the MPs’ Scheme of
Business Costs and Expenses (‘the Scheme’), following this review and
public consultation. Most changes come into effect on 1 April 2015, except
where stated otherwise. Please refer to the Scheme for full details of all
the rules and guidance.
We have changed the rules on MPs’ staff pensions
to ensure that the Scheme complies with legislation on pension auto-enrolment. We
have replaced references to the current staff pension scheme (which does not
qualify under the auto-enrolment rules) with a new pension scheme. We have also
removed the provision for MPs’ staff to request alternative pension arrangements
in the new Parliament (as this practice does not comply with the rules on
The Staffing Expenditure budget has been
increased by 1% to £147,000 for London Area MPs and £140,000 for non-London
Area MPs, to reflect the wider public sector pay policy.
Office Costs Expenditure (OCE)
- We have clarified MPs’ responsibilities for notifying
IPSA when there is any change to the rental arrangements of a constituency
- The Office Costs Expenditure budget has been
increased by 0.5% to £26,050 for London Area MPs and £23,400 for non-London
Area MPs, to reflect consumer price inflation.
- We have clarified MPs’ responsibilities for
notifying IPSA when there is any change to the rental arrangements of
There is no change to the Accommodation
- We have amended the rules to clarify that MPs’
staff members may only claim subsistence where their overnight stay is directly
associated with a claimable journey under the Scheme.
- We have moved the Fundamental Principles so that
they have greater prominence within the Scheme (moved from Schedule 1 to the front),
and have renumbered the other Schedules.
- We have removed the redundant references to the
mortgage interest subsidy (Chapter 4 and Annex A) as the subsidy has ended.
- We have added a new Annex A to the Scheme to
provide a summary table of the budgets for 2015-16.
- We will implement the rule changes agreed in
December 2013, including removing hospitality claims and the late sitting food
subsidy. We have tightened the rules on taxis and hotels after late sittings of
the House. We will no longer allow claims, under the Accommodation rules, for
TV licences and home contents insurance. All of these changes take effect from
8 May 2015.
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