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Mr. Cook: This is a matter for the House to decide, and the House's decision will be one that I personally would take as binding on me as Leader of the House. I would not argue with that judgment. [Hon. Members: "Hear, hear."] But[Laughter]since I have been generous in giving that assurance to the House as Leader, I would ask the House to consider the advice that I am about to offer it.
We would ask hon. Members, before taking their decision, to reflect on whether Members of Parliament can accept an even wider gap than already exists in the rate of accrual between our pension scheme and the schemes of those who work in our hospitals, schools and local authorities. My colleagues at the Treasury attach particular weight to the public spending consequences if the accrual rate in the amendment were to become general across the public sector.
Mr. John Butterfill (Bournemouth, West): Could I say first that although the amendment stands in my name, it does so on behalf of all the trustees? Our soon to be ennobled Friend, Mr. MacGregor, is not able to attach his name, although he remains chairman of the trustees. All the other trustees of the fund support the amendment. As I wish to show later in the debate, ours is actually the meanest accrual rate of any assembly anywhere in the western world.
Mr. Cook: I have noted that the trustees have all signed the amendment and that they made a submission to the SSRB precisely in the terms of the amendment. I spoke yesterday with John MacGregor and it is only fair to report to the House that he fully shares the views expressed in the amendment.
Nevertheless, the fact remains that when that submission was put to the SSRB, it was not persuaded by the proposal and did not accept the basis of the argument put forward. The SSRB drew particular attention, as my right hon. Friends at the Treasury have done vigorously, to the fact that that would create a quite remarkable difference between our pension scheme and others in the public sector. Hon. Members have to reflect on whether they are willing to contemplate the public spending consequences of making a comparable change in those schemes.
There is no report before the House on the additional costs allowance. However, I recognise the widespread feeling among Members that the present allowance does not reflect the current realities of the London housing market. This is a particular problem for new Members seeking accommodation for the first time at current rates.
An amendment has been tabled by my hon. Friend the Member for Sheffield, Attercliffe (Mr. Betts), and many, many other Members. If I understood the point of order earlier, many other Members who have not yet got their name on to the Order Paper also support it. This, again, is a House of Commons matter on which the House must make its own decision. However, the terms of the amendment would result in a very large increase indeed and would produce a new ceiling of £19,300, an increase of 42 per cent.
I fully understand why some Members demand parity with the new overnight allowance recommended for the House of Lords and define parity as 144 nights at £120. However, under the amendment as drafted, we would end up with £2,000 more a year than such parity with the House of Lords allowance would afford. This, I suspect, would be challenging to explain to Members of the House of Lords, let alone to justify to members of the public. But as I said, I recognise that there is a problem with the additional costs allowance. For some years, it has been uprated only in line with the retail prices index, while the London housing market has tended to uprate itself faster than RPI.
Mr. Clive Betts (Sheffield, Attercliffe): I do not know whether my right hon. Friend is aware of the calculations for the last financial year, which show, essentially, that the House of Lords overnight allowance was £84. If one divided the additional costs allowance by the number of days Parliament sat, it came to about £83. Proposing the same proportionate increase would mean that when the total additional costs allowance is divided by the number of days Parliament sits, it comes out at the same figure.
Page 44 of the second volume of the SSRB report states that three-star hotel accommodation has been the traditional way of judging both the overnight allowance for the Lords and the ACA for the Commons. There is the same basis for both schemes, but one is to get an increase this time while the other does not.
Mr. Cook: The issue of principle does not turn the calculation, but the figure I have just mentioned would be the consequence of my hon. Friend's amendment. We would end up with an additional costs allowance of £19,300, which is well above what would be required to meet 144 nights at the overnight allowance of £120 for Members of the House of Lords.
I understand the concern that lies behind my hon. Friend's amendment. I personally would regard it as unfortunate if the House were to depart from the principle that, before increasing our pay or personal allowances, we should first invite assessment by the independent review body. I give an undertaking to the House that, in the event of Members rejecting this amendment, the Government will refer the issue of the additional costs allowance to the SSRB and will invite it to report on an appropriate revised ceiling, as a matter of urgency. That will give us
I turn now to the resolution on Members' allowances and insurance. Let me dispose first of the provision for appropriate insurance. It is a matter of regret that we live in an age which is increasingly litigious, and I have to report that Members of Parliament also are victims of the increasing tendency to sue. Last year, the issue came before the House as the result of an action for defamation brought against an Opposition Member. The House then resolved to make general provision for insurance against action for defamation and to cover the Member for his costs.
This year, the matter comes before the House again because of a legal action claiming negligence against my right hon. Friend the Member for Blackburn (Mr. Straw). I have set out some of the facts of that case in a written answer, and as a legal settlement of the action has yet to be reached, the House will understand if I cannot enlarge on that.
In any case, the particular facts of the case are not the key issue. The central point is that what has happened to my right hon. Friend could have happened to many Members of the House. We all prize the hard work of our constituency staff, but with the best will in the world they can make mistakes under pressure. In today's litigious world we all face the risk of being sued for their mistakes. In most other professions, insurance cover against such a legal risk is routine and Members of Parliament should have the same protection.
The resolution before the House will ensure that all Members are provided with insurance cover against claims for negligence, as well as claims for defamation. That will provide future cover for any Members who find themselves in the same position as my right hon. Friend. It would be unfair to leave my right hon. Friend with any liability that arose from the conduct of his constituency duties, and the separate resolution compensates him for any reasonable costs of the present action. I hope that this resolution will receive all-party support in the same spirit as the resolution compensating the hon. Member for Mid-Worcestershire (Mr. Luff) last year.
I turn now to the office costs allowance, on which the SSRB proposed sweeping changes. At the outset, I would ask the House to recognise that those changes are so sweeping thatunavoidablyissues will arise in the light of experience that will require adjustment. Indeed, some of the amendments on the Order Paper already highlight problems on which the SSRB report does not offer specific guidance. A good case in point is the amendment from the hon. Member for Beckenham (Mrs. Lait) on the use of the staff element to pay for research on a consultancy basis.
We therefore believe that it will be essential to provide more flexibility in the system in order that modest adjustments can be made without the cumbersome procedure of a further review by the SSRB. The resolution therefore proposes that there should be a Speaker's advisory panel to supervise the transition and to advise on the implementation of the new system. The panel will combine cross-party membership with senior officials who can advise on the practical implications of our conclusions.
The resolution also gives authority to the Speaker to make directions as necessary, and those will, of course, be published for Members of the House. That will assist the authorities in responding to the detailed problems that will inevitably occur in phasing in such a radically different system, and in resolving individual cases of difficulty.
The new system represents a radical overhaul of the way in which we fund support for Members in pursuit of their constituency and parliamentary duties. Although it has been proposed by the SSRB, it follows from extensive evidence from Members of the House, and remedies much of the frustration that Members have expressed with the present system.