Leader: MPs should be paid more but the whole system needs urgent reform

There is a sense of widespread disenfranchisement from a political system that people feel is corrupt and rigged against them.

This article is from the upcoming New Statesman, out on 4 July. To purchase the full magazine - with our  signature mix of opinion, longreads and arts coverage, plus an essay by John Bew on Syria, a critical appraisal of Vermeer by Craig Raine and columns by Laurie Penny, Rafael Behr, Will Self and Mehdi Hasan - please visit our subscription page.

The suggestion that MPs’ pay should be increased, during this protracted and bitter period of austerity, seems like an idea drawn from the Louis XVI school of public relations. Average wages are not forecast to return to their pre-recession level until 2023 and, after a two-year pay freeze, public-sector salary rises have been capped at 1 per cent until 2016. If any group is to be exempt from such privation, how many will agree it should be MPs?

After the expenses scandal of 2009, MPs ceded control over their pay to an arm’s-length regulator, the Independent Parliamentary Standards Authority (Ipsa). David Cameron declared at the time: “We say that from now and into the future, MPs should not vote on our pay, our expenses, our pensions, our terms of service . . . Isn’t that an essential part of restoring faith in parliament, in politics, in this House of Commons, that all of us care about?” What he did not anticipate was that Ipsa, unbeholden to public opinion, would suggest that MPs’ pay should rise, not fall. When the body publishes its recommendations later this month, it is expected to propose a 13 per cent increase in MPs’ basic salaries from their current level of £66,396 to £75,000. MPs also have generous pension allowances.

For fear of incurring the wrath of voters and the tabloid media, all three of the main party leaders have distanced themselves from the report. Mr Cameron has argued that the “cost of politics” must be reduced, Ed Miliband has suggested that any increase in pay should be pegged at 1 per cent and Nick Clegg has described, with his usual verbal elegance, the prospect of a rise as “potty”. Some MPs have even suggested that parliament should strip Ipsa of its responsibilities in this area. Yet, privately, most recognise the case for reform. A survey of 100 MPs conducted by YouGov on Ipsa’s behalf found that 69 per cent thought they were underpaid, with an average salary of £86,250 proposed.

Any assessment of MPs’ pay must begin by acknowledging that, by historical standards, they are not underpaid and that they already earn vastly more than most of those they represent. In 1979, MPs were paid £9,450, the equivalent of £40,490 in real terms. Their pay has since risen by more than 50 per cent, compared to an average increase of 37 per cent. The median full-time salary in the UK is £26,312, putting MPs comfortably in the top 5 per cent of earners.

Yet if parliamentarians have less cause for complaint than some suggest, the case for an increase in their pay remains a compelling one. The average MP now works 69 hours a week, excluding travel, with much time spent on constituency casework. British members are paid significantly less than their counterparts in Japan (£165,945), the United States (£108,032), Australia (£120,875), Italy (£112,898) and Canada (£99,322) and less than the average GP (£88,920) and far less than the typical BBC executive.

Should MPs’ salaries remain frozen at their current level, the result will be an even narrower political system, the preserve of the trust-fund class, the wealthy and the entitled. It was in an attempt to avert this fate that David Lloyd George introduced an annual stipend of £400 for MPs in 1911, describing it is an allowance for those “who cannot be here because their means do not allow it”.

Today, for those without inherited wealth or lucrative business interests, the obstacles to becoming an MP are becoming more formidable. As the former Labour general secretary Peter Watt recently wrote of parliamentary selections, “If you can’t afford to take a couple of months off work, pay for accommodation and travel, abandon your family and pay for your own materials you are screwed.” Add to this the estimated £10,000 cost of running for parliament and higher pay begins to look like nothing less than adequate compensation for what is or should be a hugely demanding job. It was this consideration that led Commons officials to encourage MPs to treat their expenses as a de facto second salary, creating the conditions for the scandal uncovered in 2009.

If an increase in pay is to be sold to the public – and it will have to be at some point – it will only be acceptable as part of a wider set of measures to improve democracy and accountability. In return for an increased basic salary, MPs should relinquish any significant outside interests and devote their full attention to legislation and to their constituents (many of whom are in desperate need of it). The bloated House of Lords, whose 760 members are able to claim a tax-free daily allowance of £300 for “clocking in”, must finally be reformed and replaced with an elected senate. All 92 hereditary peers should be abolished. And all parties must give greater thought to how to enable more working-class candidates to stand for parliament, including the possibility of a public allowance for those without the necessary means.

Our politics are debased and our culture is hysterical. The public is no longer merely sceptical of MPs’ motives; it is cynical about them. And fewer and fewer people wish to become members of a political party. There is a sense of widespread disenfranchisement from a political system that people feel is corrupt and rigged against them.

If we are to have a democracy that is truly worthy of the name, it is time to recognise that we will need to pay for it.

The Houses of Parliament. Photograph: Getty Images

This article first appeared in the 08 July 2013 issue of the New Statesman, The world takes sides

Getty
Show Hide image

The tale of Battersea power station shows how affordable housing is lost

Initially, the developers promised 636 affordable homes. Now, they have reduced the number to 386. 

It’s the most predictable trick in the big book of property development. A developer signs an agreement with a local council promising to provide a barely acceptable level of barely affordable housing, then slashes these commitments at the first, second and third signs of trouble. It’s happened all over the country, from Hastings to Cumbria. But it happens most often in London, and most recently of all at Battersea power station, the Thames landmark and long-time London ruin which I wrote about in my 2016 book, Up In Smoke: The Failed Dreams of Battersea Power Station. For decades, the power station was one of London’s most popular buildings but now it represents some of the most depressing aspects of the capital’s attempts at regeneration. Almost in shame, the building itself has started to disappear from view behind a curtain of ugly gold-and-glass apartments aimed squarely at the international rich. The Battersea power station development is costing around £9bn. There will be around 4,200 flats, an office for Apple and a new Tube station. But only 386 of the new flats will be considered affordable

What makes the Battersea power station development worse is the developer’s argument for why there are so few affordable homes, which runs something like this. The bottom is falling out of the luxury homes market because too many are being built, which means developers can no longer afford to build the sort of homes that people actually want. It’s yet another sign of the failure of the housing market to provide what is most needed. But it also highlights the delusion of politicians who still seem to believe that property developers are going to provide the answers to one of the most pressing problems in politics.

A Malaysian consortium acquired the power station in 2012 and initially promised to build 517 affordable units, which then rose to 636. This was pretty meagre, but with four developers having already failed to develop the site, it was enough to satisfy Wandsworth council. By the time I wrote Up In Smoke, this had been reduced back to 565 units – around 15 per cent of the total number of new flats. Now the developers want to build only 386 affordable homes – around 9 per cent of the final residential offering, which includes expensive flats bought by the likes of Sting and Bear Grylls. 

The developers say this is because of escalating costs and the technical challenges of restoring the power station – but it’s also the case that the entire Nine Elms area between Battersea and Vauxhall is experiencing a glut of similar property, which is driving down prices. They want to focus instead on paying for the new Northern Line extension that joins the power station to Kennington. The slashing of affordable housing can be done without need for a new planning application or public consultation by using a “deed of variation”. It also means Mayor Sadiq Khan can’t do much more than write to Wandsworth urging the council to reject the new scheme. There’s little chance of that. Conservative Wandsworth has been committed to a developer-led solution to the power station for three decades and in that time has perfected the art of rolling over, despite several excruciating, and occasionally hilarious, disappointments.

The Battersea power station situation also highlights the sophistry developers will use to excuse any decision. When I interviewed Rob Tincknell, the developer’s chief executive, in 2014, he boasted it was the developer’s commitment to paying for the Northern Line extension (NLE) that was allowing the already limited amount of affordable housing to be built in the first place. Without the NLE, he insisted, they would never be able to build this number of affordable units. “The important point to note is that the NLE project allows the development density in the district of Nine Elms to nearly double,” he said. “Therefore, without the NLE the density at Battersea would be about half and even if there was a higher level of affordable, say 30 per cent, it would be a percentage of a lower figure and therefore the city wouldn’t get any more affordable than they do now.”

Now the argument is reversed. Because the developer has to pay for the transport infrastructure, they can’t afford to build as much affordable housing. Smart hey?

It’s not entirely hopeless. Wandsworth may yet reject the plan, while the developers say they hope to restore the missing 250 units at the end of the build.

But I wouldn’t hold your breath.

This is a version of a blog post which originally appeared here.

0800 7318496