MPs’ pay: an expensive mistake

Step back for a moment to 2009, to the height of the UK MPs’ expenses scandal. In a frantic bid to placate the public and muzzle a critical press, MPs from all parties welcomed the introduction of an ‘independent’ body that would make all future decisions about MPs’ pay and expenses on their behalf. They could now wash their hands of the matter, and reassure the public that decisions about parliamentary pay and perks were now well and truly out of MPs’ control.

Such an approach was cheered by red, blue and yellow political parties alike. It would, MPs announced, ‘boost trust’ in parliament. In a debate in the House of Commons following the scandal, a Labour MP declared it was time to ‘grasp the nettle’ because ‘the future is absolutely in independent regulation’. A Lib Dem MP claimed that ‘self-regulation for this place was on very flimsy foundations indeed… [T]he House has forfeited the right to self-regulation’.

The Tories offered ‘the cooperation of the official opposition’ in ‘relinquish[ing] the right to determine how we reward ourselves’. An ‘outside structure’ is necessary if parliament ‘is not to sink further in the eyes of voters’. This move ‘from self-regulation to a system of statutory regulation’ would, declared the then leader of the House of Commons, Harriet Harman, offer ‘reassurance’ to the public, putting parliament ‘above reproach’. Shortly afterwards, the Independent Parliamentary Standards Authority (IPSA) was launched. Statutory regulation of the state – what could go wrong?

Four years on, IPSA has done little to assuage public cynicism towards politicians. This magic bullet for boosting trust is loathed by the public and MPs alike. At £6.6million, the establishment of the IPSA cost over six times what MPs fiddled in expenses, with IPSA repeatedly being told to keep spiralling running costs down. According to a doctor responsible for MPs’ wellbeing, the stress IPSA has been creating is even impacting upon their ‘mental health’. And now it looks set to make matters worse by announcing that it is going to increase MPs’ pay from £66,400 to £74,000 (a rise of 11 per cent) in 2015.

A cynic may think that MPs would welcome such an increase. After all, as an anonymous poll conducted by IPSA found that 69 per cent of MPs believed they were currently underpaid, and they wanted, on average, a pay increase of 32 per cent to £86,250. But even the least-PR-savvy individuals in the Commons have recognised that this is electoral suicide, especially when the government has only granted a pay rise of one per cent to the rest of the public sector.

Cue cross-party outrage. Such a pay rise would be ‘utterly comprehensible’, ‘staggering’, ‘alarming’, blustered MPs of every hue. The decision was ‘entirely out of any context of the real world’, ‘absurd’, ‘crazy’, ‘ludicrous’ and ‘will destroy what’s left of trust in MPs and politics’.

However, having put such decisions safely in the hands of an external body, for MPs to overrule IPSA would require, as Conservative MP Sir Peter Bottomley points out, ‘MPs to pass a law saying IPSA is abolished’. This rather puts MPs between a rock and a hard place: either they scrap the body they set up to get them out of the hole of the expenses scandal, or they allow IPSA to potentially dig an even deeper hole for MPs at the least opportune of times.

It’s hard to have any sympathy. The PR disaster MPs seem now powerless to avert is a direct result of them relinquishing decision-making power in the first place. From regulation of the police to regulation of the press, politicians have been only too quick to champion ‘independent’ regulation of institutions. The irony of the MPs’ pay-rise proposals is that MPs are becoming one of the first groups to be hit by the very real problem of this outsourcing of authority – namely, what happens if this ‘independent’ body ends up making a wholly inappropriate or utterly wrong decision?

At least in this instance, MPs do have the ‘nuclear’ option of scrapping IPSA and taking decisions back into their own hands – although it seems unlikely they will have the stomach for it. When it comes to regulating the press, the much touted Royal Charter is being designed specifically to remove even that option, allowing an independent body to almost literally reign supreme.

The clear lesson from this mess is that ‘grasping the nettle’ should not mean relinquishing decision-making power. MPs have, after all, been elected to make the tough decisions – and this should include even tricky matters such as their own remuneration. Attempts to avoid making decisions by setting up unelected and unaccountable ‘independent’ bodies to be ‘above reproach’ are grounds for reproach indeed. It’s time MPs truly ‘grasped the nettle’ and ditched IPSA and the whole fixation with independent regulation, and took on the responsibility of making difficult decisions themselves.

Patrick Hayes is a columnist for spiked.