MPs’ pay rise unacceptable: Osborne


Published: Sunday 7th September 2014 by The News Editor

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George Osborne has insisted a 10% pay hike for MPs is “unacceptable” after the Commons watchdog reiterated its determination to push ahead with the rise.

The Chancellor suggested the move will be blocked after the general election, stressing that the Independent Parliamentary Standards Authority’s (Ipsa) position was not “final”.

The comments, in an interview with the BBC’s Andrew Marr show, came after new Ipsa chief executive Marcial Boo reiterated its commitment to the increase from £67,000 to £74,000.

He said the economy was recovering and politicians should not be paid a “miserly amount”.

“All the evidence points towards MPs’ salaries having fallen behind,” he told the Sunday Telegraph.

Some viewed the £74,000 figure as “at the low end” and failure to pay “fair” rates would make it harder to recruit good candidates for parliament in future.

“This is an important job, the job of an MP,” Mr Boo said.

“They are there to represent us all, to form laws, to send young people to war.

“It is not an easy thing to do. We want to have good people doing the job and they need to be paid fairly.

“Now, that’s not paid in excess but it’s not being paid a miserly amount either.

“It’s our job to reach the judgement of what the right amount is. There are lots and lots of professionals in public life and in the private sector who earn a lot more than that – so it is not an excessive amount of money at all.”

There was an outcry when Ipsa announced the rise last year, with David Cameron, Ed Miliband and Nick Clegg arguing it was unacceptable at a time when public sector rises were capped at 1%.

MPs are already due a 1% increase to £67,731 next April and under Ipsa’s plan it will go up again a month later to £74,000.

The watchdog has said it will conduct one further review of the pay rise after the election – as it is legally obliged to do – but Mr Boo made clear its conclusions were unlikely to shift.

“We were allowing for any change in economic circumstances,” he said.

“At that time we had only just emerged from recession, it wasn’t quite clear we were going to have the growth that we have got now as a country, so we left the option open to change the position.

“As of now, September, it doesn’t look like there is any major economic factor that would change the determination that we reached in 2013.”

He added: “Parliament as a whole has created an independent body to set MPs’ pay. We have gone through the process in a really rigorous way. It is not an arbitrary figure that we have come up with.

“Obviously, it is for parliament to decide whether they want to take back responsibility for setting their own pay. I don’t believe that’s right.

“I think we are in a better position as a country now when we have an independent, transparent regulator that is tasked with determining MPs’ remuneration.

“This is the number that we’ve come up with and we talked both to the public and to MPs about it.

“But if Parliament wants to change its mind and to change our remit, then that’s clearly for them.”

Mr Boo – whose own £120,000 salary is £10,000 more than that of his predecessor – insisted a change in the law would be needed to prevent Ipsa following through on its proposals.

Another potential block to the pay rise was removed over the summer when Ipsa chairman Sir Ian Kennedy was reappointed for another 18 months – meaning he will remain in post after the general election.

However, Mr Osborne promised that the issue would be “tackled”.

“I don’t think it is acceptable at a time when there is continuing pay restraint in the public sector that MPs would receive such a big increase,” he said.

“But this is not the final verdict, this is not the final report. There will be a report after the election and that’s when we are going to have to tackle this issue.”

John O’Connell, Director of the TaxPayers’ Alliance, said: “Hiking politicians’ wages at a time when the national debt is still rising would be totally inappropriate.

“In insisting on a pay rise, Ipsa is demonstrating itself once again to be totally unfit for purpose. This overgrown monster of a quango needs to understand that the public don’t want the cost of government to go up any further.”

A Labour Party spokesman said: “If the package of proposals being set out by Ipsa is as reported it cannot go ahead when people are going through the biggest cost-of-living crisis for a generation.

“We cannot have an outcome for MPs which does not command public confidence.

“Therefore, we are asking the Conservatives and the Liberal Democrats for a cross-party approach which recognises the current economic circumstances where workers in the public and private sectors are going through such difficult times.”

Published: Sunday 7th September 2014 by The News Editor

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