Monday 14 September 2009
 
REBUILDING TRUST IN MODERN DEMOCRATIC BRITAIN

Harriet Harman says reforms in Parliament are essential to rebuild public trust and will have effect before the next General Election.  The Leader of the House set out details of progress on the reforms in a speech at an event organised by the Centre for Public Policy Seminars in London today:

"It is very much a critical time for parliamentary democracy in this country.  Our parliament has suffered much self-inflicted injury and we all recognise it is imperative that we make every effort to rebuild trust in modern democratic Britain not so much for the sake of politicians but for the sake of citizens who need and are entitled to an effective democracy in which they can trust.

Confidence in government essential in economic crisis
 
I think that is important at all times.  But it is even more important at a time when the country has faced the effects of a global financial crisis which has demanded unprecedented intervention and far reaching action by government and which is needed to be sanctioned by parliament.  When the scale of government action is greatest, public confidence in our democracy is crucial and we are determined that we will do everything it takes to renew it.

I think there are four key principles underpinning the action we have taken.

First, transparency - the public must know that they know everything that they want to know.  Allowances are public money and people want to see how they are spent; secondly, sorting out the past - a system of payback of past over payments; thirdly, accountability - allowances governed by strict rules and rigorously audited and, fourthly, independence and an end to self regulation.  The public no longer simply trust us to run and supervise our own allowance system.

Now, we have already taken major steps towards this and I want to set out the work already done while at the same time acknowledging that this is not just a snapshot position. We will have to demonstrate all this very clearly to the public before they are able again to have full confidence in their MPs and their democracy. 

Growing public scepticism and growing demands on MPs

The public are increasingly sceptical and less likely to take anything on trust.  That is not a bad thing.  Far from it.  But it does mean that we have to have higher standards of transparency and accountability and meet those higher standards.  We have to keep reviewing them and we know we not only have to win trust now but be continuously vigilant and keep on earning it.

At the same time as recognising the need for reform and I am fully acknowledging the public anger at the system of allowances and the  resulting abuses that have been exposed. I think that it is really important to argue that most "honourable members" are precisely that, they are people who come into  Parliament as a matter of public service, and are hard-working, decent and honest.

Their responsibility is to represent and respond to their constituents and to do that to the highest standard. To do that,  they must have the resources to provide the best service.  That is the point of the allowance system.  Not to add to MPs' pay but to enable them to do their job, run their office and live both in their constituency and in Westminster.

The system of allowances really began in the 1970s and was a move to enable all MPs, not just those with private wealth, to run an office and live in their constituency and Westminster.  It began very minimally.  Certainly when I first came into parliament in the early 80's the allowances were wholly inadequate to meet the growing demands of constituents to be in contact with their MP and to have their MP take action on their behalf and meet the ever-growing, justified, requests of our constituents whether the first port of call or the last resort in helping with their problems.  In those early years, like many MPs, I had to pay much of my salary to run my constituency office. Over the subsequent years the allowances were increased as demands were recognised. But the root of the problem was that, as the allowances were increased,  the clarity of the rules was not strengthened and the audit was not increased commensurately. So we ended up with a system which was adequate to enable us to do our job but which was complex, unclear and not properly audited.

The work that we have already undertaken and that which is still underway.
 
We had already begun to publish the amounts in allowance given to each MP in allowances - and shown it broken down into headings of expenditure.  But it was evident that with the publication of all receipts and claim forms for MP's expenses, there would be massive scrutiny.

This focussed attention and therefore ahead of the publication under the Freedom of Information Act we established clearer rules. We had started already. We reduced the threshold for claims that need receipts, restricted what could be the subject of claims and put in place more stringent audit. We also ensured that employment contracts and job descriptions for MPs staff must be lodged with the Commons authorities.

Now, there can be no claiming for furniture, no changing the designation of a main home, there is a cap on monthly rent or mortgage payments, there is no minimum amount for receipts to back up claims and MP couples can only claim for one second home, even if their constituencies are miles away from each other.

In April we decided that, from 1st July, any payment to an MP for services, whether in cash or kind, has to be registered. That means that for the first time, the public can see all the payments that are made to Members. The public want to know who, other than them, is paying their MP.
It is basic that the new system must ensure clarity and transparency.  But in order to reassure the public that the system has really been sorted out, it is important that it is completely independent, so that we MPs no longer have to set and run our own allowances,

Independence essential

So, this summer, Parliament legislated to set up a new Independent Parliamentary Standards Authority which - when it gets up and running later this year - will set the rules relating to MPs' expenses and administer the expenses scheme.

The importance of this is that it represents a major change from dealing with allowances "in house".  We have recognised that no matter how clear our rules, no matter how robust our audit, the public will simply not be satisfied if we are, as MPs, running our own expense system.

And just as MPs no longer vote on our own pay, in future we will play no part in setting or administering the allowances.

The framework of the allowances is being reviewed, again completely independently, by the Committee on Standards in Public life which is chaired by Sir Christopher Kelly and he will report later this autumn on the allowance structure which he recommends is necessary both for commanding public confidence and for enabling MPs to fulfil our important constituency and parliamentary duties.

Dealing with the past - payback of overclaims

It is not enough for the claims in the future to be clear, transparent and robustly audited.   We have to deal with the past in a way that commands public confidence.  It is not enough for past overclaims to be to be identified and exposed to public scrutiny, as they have been. They need to be paid back.  When social security benefits are overpaid even where it is simply a mistake, they have to be paid back.  The same principle is going to apply to MPs.   If they were not fully within the rules as they obtained at the time, those payments are going to have to be paid back.

To establish this, we have set up an independent review to look at each and every claim made by each and every MP over each of the last 5 years and identify whether each and every claim was fully within the rules.  Sir Thomas Legg is leading this review.  We expect him to report to the all-party Members Estimate Committee chaired by the Speaker in the autumn and any overpayments will be paid back. The new Parliamentary Standards Act gives the Independent Parliamentary Standards Authority the power to deduct past overpayments from Members' future claims.

Strengthening the role of the House of Commons

It is also necessary to continue to build on the reform to procedures within Parliament to strengthen the role of backbenchers and parliament in holding the government to account.  To do this, on a cross party basis, a parliamentary Committee on House of Commons reform has been established, with Tony Wright as its chair, to make recommendations to improve the way the House works including the procedures for the appointment of members and Chairmen of Select Committees, the scheduling of business in the House, and enabling the public to initiate debates and proceedings of the House. Proposals will come out later this year.

More diverse representation.
 
We need change not only to increase transparency and accountability but also to reflect further changes in society and in public attitudes including the increased diversity in society and changing public attitudes to women's equality, and rights for disabled people.
 
Though the House of Commons is much more representative of our diverse ethnic communities and though women are better represented now than they were when I first entered parliament in 1982 - there is still a long way to go.
 
When I first entered parliament, 97% of MPs were men and 3% women.  Since then, we have increased the number of women MPs - but only to 20 %.  Those women have not only changed the face of British politics but have changed the public policy agenda too - with childcare, flexible working  and domestic violence issues like that now moving from the margins to the mainstream of the political agenda. But as there as still 5 times as many men as women in the House of Commons, we still have further to go.
 
Ten per cent of our population is black or asian yet only 2% of MPs are black or asian. To be representative of the population there should be five times that number. 
 
There are 10 million disabled people in this country.  Yet while many disabled people work alongside those without disabilities - what is normal outside the House is still exceptional within it.
 
We have taken further action as a government.  We have brought forward legislation to allow all women shortlists. We have legislated to outlaw discrimination on grounds of disability and sexual orientation. 
 
In the new Equality Bill, we are changing the law to enable political parties, as part of their process of selecting candidates to take positive measures to bring forward candidates from under-represented groups, particularly black and asian people.
 
But government action is not enough. We need a whole House of Commons approach and that is why we established the Speaker's Conference last November to consider, and to recommend to parties, how to improve representation of women, disabled, and minority ethnic people in the House of Commons so that it better represents society. 
 
Its interim report in July recommended that each political party should commit to report a candidate's gender, ethnicity, disability and sexual orientation by 12th October to put a spotlight on the progress being made. This transparency is vital to making progress. I look forward to the Conference's final recommendations at the end of the year.

But people's confidence that they have genuine power in their democracy is bound up with socio-economic status too.

The chairman of the FTSE top 100 company expects, and does, have influence and power in a way which is not felt by the council tenant struggling to make ends meet.  Democracy is quintessentially a doctrine of equality.  So, our quest to ensure equality in our democracy goes hand in hand with our determination to bring about greater socio-economic equality - to narrow the gap between rich and poor.

That is one of the many justifications for the clause in the equality bill which will lay a new duty on all strategic public authorities to act in a way which narrows the gap between rich and poor.

Together, all these measure will see us make more progress to a representative and trusted House of Commons.

All of these are steps that are necessary before the next general election:

. Sorting out MPs allowances
. Further strengthening the role of parliament and
. Taking steps to make parliament more diverse and representative

All this can and will be done so that when it comes to everyone being asked to cast their vote at the next General Election they will be able to have confidence in the system to which they are being asked to elect their representatives."