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IPSA blog > Posts > IPSA Board member Anne Whitaker: MPs’ business costs and expenses - higher or lower than before the scandal?


October 04
IPSA Board member Anne Whitaker: MPs’ business costs and expenses - higher or lower than before the scandal?

Last month, IPSA published all the details of every claim made by every MP for the full 2012-13 calendar year. Publishing this information is one of the most important things IPSA does – it means everyone can see exactly where public money is being spent.

It also means everyone can see exactly how much was claimed overall, and how this total changes over time. 

If you read the news reports, you’d be forgiven for thinking that in 2012-13 MPs’ claimed more in business costs and expenses than ever before. In fact, several newspapers said exactly that.
The problem is, they were entirely wrong.
I should point out that IPSA doesn’t think that expense claims rising or falling is necessarily a good thing – MPs’ need to run effective offices, and need resources to do their jobs. Each MP decides how to run their office differently, depending on the needs of their constituency, and costs will naturally change over time.
At the same time, it’s important that debates about how we allocate limited public resources are conducted with accurate facts.
So, fact one: the total value of claims published by IPSA for 2012-13 was £98.1m. You can find them all here.
Fact two: In 2008-09, the last year before the expenses scandal, the House of Commons Fees Office paid a total of £102.3m in expenses. You can find that on page 34 of this report (you need to subtract the cost of paying for Opposition parties for it to be a fair comparison - it’s not something IPSA pays).
Some simple calculator work will show you that the IPSA total for 2012-13 is £4.2m lower than the House was in 2008-09 - clearly not the record, then.
However, this gap doesn’t allow for the increase in prices between the 2008 and 2013. Once price and wage inflation is added in, the 2008-09 total rises to £108.4m – more than £10m higher than IPSA in 2012-13. 


In fact, when you compare what IPSA has paid in business costs and expenses to the system we replaced, it’s pretty obvious we’ve saved the taxpayer quite a bit of money: 
Expenses paid, £m (inflation-adjusted)
Fees Office**
*IPSA started paying MPs’ expenses following the May 2010 election. This means the IPSA figure only covers 10 months. The Fees Office figure of £105.6m has been reduced to also reflect 10 months.
**2008-09 total in £ of the day
That’s £38.5 million saved, in less than three years. And still £10m a year cheaper than the system we replaced.
That’s worth remembering next time someone tells you that nothing has changed since 2009.



Re: IPSA Board member Anne Whitaker: MPs’ expenses - higher or lower than before the scandal?

Your 'simple calculator work' sadly fails to compare like figures from 2008-9 and 2012-13 (the ones from the accounts are not equivalent). You also conflate price inflation and wage inflation - two rather different things, especially over this period.
 on 10/7/2013 5:41 PM

IPSA response - Re: IPSA Board member Anne Whitaker: MPs’ expenses - higher or lower than before the scandal?

You’re right that those two inflation measures were different over the period. That difference is reflected in the table – price inflation is applied to the non-payroll costs, and 1% to the salary costs to reflect public sector pay policy over the period.

Not sure why you don’t think the two figures are comparable. Those responsibilities are the ones that passed to IPSA (apart from the funding to Opposition parties, which is both noted and allowed for). Even in cash terms, the total cost of expenses claimed in 2012-13 is lower than in 2008-09.

TH – IPSA staff.
 on 10/9/2013 9:20 AM

Re: IPSA Board member Anne Whitaker: MPs’ business costs and expenses - higher or lower than before the scandal?

Just glancing through:
:: central provision of IT and other services still comes from the the Commons budget - a few million.
:: You also need to take off the members fund and other grants - still paid by the Commons.
:: Not all insurance came across to Ipsa's budget (employment liability etc)
:: The Communications Allowance was substantively shifted to the Commons budgets when it was scrapped - stamps and postage now sits on the members account and is worth around £2.5m.

Also not sure it's a good idea to adjust the claims figures to 10 months when it seems likely that April and May, after the end of the financial year, would be low-claiming.

I take the general point on inflation, and the unfairness of cash comparison. But if you're claiming to be putting out more accurate figures than everyone else - I don't think you've made it over that bar.
 on 10/11/2013 4:13 PM

Re: IPSA Board member Anne Whitaker: MPs’ business costs and expenses - higher or lower than before the scandal?

These figures do appear to suggest, then, that too much money was indeed being claimed before IPSA's arrival...
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