MPS MAKE MILLIONS SELLING HOMES YOU HELPED PAY FOR
Outrage as 160 politicians profit from taxpayer-funded mortgage perk
MORE than 160 MPs made £42million profit selling houses taxpayers helped fund.
They include Tories Michael Gove, David Tredinnick and Maria Miller who claimed for second homes. Ex-MP Martin Bell said: “They should pay it back.”
CAMPAIGNERS last night demanded MPs who pocketed vast sums after flogging their taxpayer-subsidised homes hand back the cash.
On the 10th anniversary of the Westminster expenses scandal that shocked Britain, the Mirror can reveal 160 politicians raked in more than £42million in profits selling properties public money helped fund.
Six, Tories Maria Miller, Michael Jack, Sir Graham Brady, David Tredinnick, Crispin Blunt and Labour MP Hugh Bayley made at least £1million each.
Mr Blunt sold his house for £2million. He declined to comment.
These are the properties on which politicians reclaimed thousands of pounds in mortgage interest payments at public expense under the discredited old expenses system.
Under parliamentary rules they are entitled to keep the gains. But with trust in politicians still low after the expenses scandal and the ongoing Brexit shambles, critics insist if MPs want to regain that faith they should hand the money to the Treasury.
Former chairman of the Committee of Standards in Public Life, Sir Alistair Graham, said: “People should not be making a profit. It was there to help them meet their public responsibilities. You should not be profiting out of special taxpayer funds.
“You should repay any gain you made over that period.
“The arrangement was made purely to take into account MPs who came from the North who would struggle to meet the housing costs.
“It would need to be carefully calculated but the Independent Parliamentary Standards Authority has done this before and they can do it again. I don’t think anything will restore trust, it’s at such a low ebb, but it’s the right thing to do.”
Former MP, journalist and ethics campaigner Martin Bell added: “It’s an open and shut case, of course they should pay it back. There is the spirit of the law, why are they making a personal profit from allowances which they receive from the taxpayer? In this case they very clearly are.
“Most people would agree. It is public money that has been spent and it gives quite the wrong impression if MPs make a profit in that way.
“I think it is only right and in the public interest that MPs are not seen to make a profit out of public money.
“I have always felt MPs should set an example. But there was a feeling then that MPs were charging the maximum they could. There was a fill your boots attitude.”
When then-Lib Dem leader Nick Clegg sold his second home in 2011, he returned nearly £40,000 in profits to the Treasury, saying he did not want to be “holier than thou” but encouraged other MPs to “get out of the property game”.
Few, if any, of his former colleagues appear to have followed suit.
Our investigation found MPs made an average profit of £255,000 on selling their taxpayer-subsidised homes, FURY Martin Bell and Nick Clegg while millions of voters struggle to even get on the housing ladder. Of the 20 who have made more than £500,000 in gross profit, 14 are Tories and six Labour.
Fourteen have sold not one but two of these properties.
We found Labour MPs making an average of £193,000 profit on the sales but the Tories made twice this each, averaging £417,000.
Until 2010, MPs – except those with seats in inner London – were allowed to claim up to £24,000 a year for a second home under the controversial Additional Costs Allowance.
They were able to claim the interest payments on their mortgages along with running costs. The old system was intended to allow MPs from all over the country to have a home near the Commons, where they can sit late into the night, but also live in their constituencies where they hold surgeries and meetings.
There was nothing stopping them keeping the profits if they sold up. After the expenses scandal, the system was overhauled. Taxpayers no longer foot the bill for the mortgages of MPs, who now can claim up to £22,760 in rent for a second home.
But MPs who had already bought theirs were allowed to keep them, plus any profits from the sale. Those with second homes in the capital have benefitted from a booming market. Since 2001, the average London house price has rocketed from £149,543 to £479,920.
Prices in exclusive areas around Westminster have risen even more. Our investigation found most but
not all of the second homes were funded by the taxpayer, so there may be examples of even greater profits than those we have unearthed.
Not all the paper profits translate into hard cash – the true profits after estate agent fees will be lower.
If the MPs still designated the property as their second home when they sold up they would have had to pay capital gains tax on the profits.
And some will have paid any mortgage themselves in full while they were not in Parliament or after the rules changed banning the claims. After Labour MP Barry Gardiner made a £198,500 profit selling his flat in 2007, he revealed he had paid 40% capital gains tax and claimed “the public purse has benefited” from the arrangement. He said: “The amount returned to the Exchequer in capital gains tax approximates to the total amounts claimed over the entire four-year period.”
We have also found three MPs – all Labour – who made a loss on the transaction. They include former Home Secretary Jacqui Smith. She went on to make a £20,000 loss selling her second home in her constituency.
But most MPs made considerable profits from the properties which some pledged to hand back.
When the expenses scandal came to light in 2009, there was widespread public anger at what many saw as MPs being greedy.
There were outrageous claims, including clearing a moat and a £1,600 floating duckhouse.
And 392 former and current MPs were ordered to repay £1.3million of the money. ■ Additional reporting: Amy Coles, Amy-Clare Martin
It’s an open and shut case, of course they should pay it back MARTIN BELL FORMER MP AND ETHICS CAMPAIGNER
BORIS Johnson’s Oxfordshire farmhouse has soared in value to £1.2million – but the taxpayers who helped him buy it won’t see a penny.
Boris’s nest egg is one of 170 “second homes” owned by current and former MPs that have shot up by £100million.
Many were bought in flashy Central
London postcodes before the 2000s boom – some have quadrupled in value.
The average growth is £570,000 for each of the 170 MPs, before costs and tax, if the properties were sold today.
Boris bought his country pile in 2003 after he was elected MP for Henley.
He paid £640,000 for it and has since seen its value rise by £560,000, or 88%.
Boris designated it his second home, meaning between 2004 and 2008 he claimed £77,957 in mortgage interest. He
to own it throughout his two-year stint living at taxpayers’ expense while Foreign Secretary.
Of the MPs’ properties the Mirror has uncovered, the top five increases in value were all owned by Tories.
Millionaire Nicholas Soames is sitting on the biggest nest egg. The member for Mid Sussex’s London pad, bought for £623,000 in 1995, is now worth an estimated £4million.
Disgraced former MP Andrew Mackay and wife Julie Kirkbride, also a former Tory MP, own two properties worth a total of nearly £4million.
The former Labour MP with a partly funded property which has risen most in value is Roger Godsiff.
Nine MPs – including current MPs Maria Eagle, Mark Hendrick, Joan Ryan and Phil Willis – have claimed on two properties and still own them.
Former Prime Minister David Cameron had a property in his constitcontinued uency in Witney, Oxon. He said of the Witney loan: “It was a very large mortgage. It was £350,000 worth of mortgage. It was about £1,700 a month I was claiming.”
The average value of the properties owned by Tories is £1.3million, a rise of £707,000 since they were bought.
For Labour MPs, the average is worth £717,000, up £495,000 for each.
After the expenses scandal, MPs were allowed to continue claiming mortgage interest payments for a twoyear “transitional” arrangement but had to repay any increase in property value over this period. Only 71 did, and repaid sums from £737 to £81,446.
One of them – Chancellor Philip Hammond – claimed another £20,967.74 in mortgage interest payments over 16 months between 2010 and 2011 on his London townhouse, bought in 2005 for £2.5million.
The newly formed Independent Parliamentary Standards Authority ordered him in 2012 to repay £34,883.54 – the amount it ruled the value had risen over that time.
It is now worth around £4million and the Chancellor is making more than £10,000 a month renting it out while he lives for free in a grace and favour flat in Downing Street.
DEMOCRACY is a great leveller and a golden opportunity for people to improve their lives, so obviously we need MPs to be trusted – and that includes over the explosive issue of expenses.
Today’s Mirror probe into how 160 benefited from the old, discredited system to make £42million between them on houses bought with taxpayer help won’t help restore that trust.
We acknowledge previous rules allowed MPs to cash in. But that doesn’t excuse them biting criticism from voters who are still smarting a decade after the great expenses scandal.
So we challenge MPs who banked or are sitting on fat profits from homes bought with public assistance to donate any windfalls to the Exchequer as a gesture of good will.
More than ever, we want renewed faith in our politicians to build a fairer Britain.
The current expenses system is significantly better but legacy questions continue to taint politics and politicians.