MPs to face a year in prison for fiddling expenses

MPs caught fiddling their expenses could face a year in prison from the autumn after the House of Commons agreed to surrender its right to police itself. Parliament looks likely to approve rules that will see Members who lobby for money or fail to declare how long they spend on work outside Parliament being hauled before a judge.

Gordon Brown promised the Independent Parliamentary Standards Authority (Ipsa) as part of “root and branch” reform of the system and a code of conduct for MPs, who were presented with 93 pages of new rules and regulations. It will be accompanied by three new criminal offences:

— Knowingly making a false claim for an allowance, with a maximum penalty 12 months’ imprisonment. The law could have been used to attempt to prosecute Michael Trend, the former Tory MP for Windsor found guilty of abusing the allowances system and ordered to repay £90,277. It might also have been used to prosecute Derek Conway, the former Tory MP for Old Bexley and Sidcup, who wrongly employed his son;

— Failing to register outside interests, which carries a maximum £5,000 fine. For the first time MPs will have to declare how much they get paid for jobs that have no connection with Parliament and how long they spend on them. This includes, for instance, Sir Menzies Campbell, a barrister, who will have to declare how much time he spends representing clients;

Taking money to lobby for work outside Parliament. Maximum penalty: £5,000 fine. Most famously, this would have caught Neil Hamilton and Tim Smith, who were given money by the lobbyist Ian Greer to ask parliamentary questions, and other tasks, on behalf of the Egyptian owner of Harrods department store, Mohamed Al Fayed.

Mr Brown told the BBC: “There are indeed criminal offences in this Bill so that if an MP misleads deliberately or if an MP does something like, without reasonable excuse, fails to register a relevant interest, that is a criminal offence and that would then be investigated by the police.”

The wording of many of the rules has generated significant concern among MPs because for the first time it means private conduct will be regulated by the courts. For instance, advocacy that benefits one company becomes illegal. However, if the lobbying benefits more than one company, it is apparently legal.

Conservative backbenchers also complained that ministerial roles were not counted as “second jobs” that require the hours they work to be registered. Harriet Harman, the Leader of the Commons, said that ministerial salaries were already made public and ministers’ diaries could be requested under freedom of information rules.

Some MPs queried whether they could be banned from discussing an individual company if they had accepted so much as a cup of tea from them.

The legislation has won support in principle of the opposition parties, and the Government will push it through Parliament before the summer. It may face a bigger challenge in the House of Lords, which is watching carefully to ensure that it does not create unwelcome precedents for peers.

The Ipsa will consist of a chief executive, five commissioners and an investigator, probably modelled on the Parliamentary Commissioner for Standards, at present John Lyon.

As well as administering payments using staff transferred from the Fees Office, it will be able to force MPs to pay back allowances and set rules without separate parliamentary approval. This may mean that its powers grow over time.

Senior lawyers have pointed out that decisions by the body will be open to challenge in the courts. At present the investigator works for and reports to the Committee on Standards and Privileges, which means that its decisions are protected from legal challenge by parliamentary privilege.

Mr Brown said that the Government was acting now — with Opposition support — to get rid of the old system of self-regulation because past Commons attempts to reform itself had failed. He said: “The mistake of the past was simply to leave everything to the House of Commons to do it on an all-party agreement basis, so that you got the lowest common denominator. That has proven to be wrong. It wasn’t acceptable.”

Last night a middleman who helped to leak details of MPs’ expenses claims said that he was proud of his actions. Henry Gewanter, a US publicity consultant based in Britain and brought in to help to get the data to the media, said that he did not know the whistleblower’s identity, adding: “Nobody involved in this did it for money.”

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