Parliamentary Standards Act 2009

Background

In 2009 the Daily Telegraph published a series of damaging reports cataloguing various revelations pertaining to the allowances and expenses claims submitted by a number of MP’s and members of the House of Lords. The expose revealed, amongst other alleged and proven misconduct, a culture of oppression with respect to the Fees Office and a series of claims for purchases and expenses which bore little or no relevance to the ability of said MP’s to carry out the functions of their office. Amongst the more spurious claims were those made with respect to the cleaning of a moat, the purchase of toiletries, the expenses incurred in employing domestic staff, bulk supplies of manure, a top of the line home entertainment system and an allowance for the cost of installing a floating duck house for a garden pond. It is worth noting that not all claims were allow, yet the fact that certain MP’s were prepared to make the attempt implied fundamental flaws in the operation of the allowances system and severely eroded public faith in the integrity of elected officials.

The resulting public outcry carried with it demands that Parliament take steps to reform the current system and introduce much needed independent oversight. The response came swiftly, with the Parliamentary Standards Bill moving through both the Commons and Lords in a matter of weeks before coming into force on July 21st 2009.

Statutory Purpose

The principal aim of the PSA 2009 is to reform the procedure by which MP’s submit expenses and allowances claims, as well as the assessment of those claims, by moving away from the previous system of self-regulation (perceived to be a catalyst for abuse) and towards a system of largely independent oversight, with a view to ensuring transparency and discouraging the submission of spurious or fraudulent claims. The PSA 2009 also aims to reinforce the aspects of the new regime by buttressing the new regulatory framework with newly introduced criminal offences relating specifically to the submission of misleading or fraudulent claims, although the PSA 2009 as enacted does not go as far as the initial Bill, in that several proposed offences did not survive the passage of the Bill through the House of Commons.

Statutory Approach

The chief innovations of the PSA 2009 lie in the creation of a separate, independent regulator, the Independent Parliamentary Standards Authority (IPSA) to oversee the development and administration of a new scheme for MP’s allowances and for the determination of claims. The IPSA is responsible for drawing up rules concerning the disclosure of Members’ financial interests, superseding the operation of the register formerly established by Resolution of the House. The PSA 2009 also introduces the office of Commissioner for Parliamentary Investigations, with the Commissioner being tasked to investigate allegations of misuse of the allowances system and breaches of the financial interest rules.

Key Provisions

Section 3

Section 3(1) is the most significant provision, as it provides for the introduction of the Independent Parliamentary Standards Authority (IPSA), with section 5(3) imposing the relevant duty to prepare an appropriate allowances scheme and to subject this scheme to regular review and revision, if necessary.

Section 10

Section 10 of the PSA 2009 introduces a criminal offence of submitting false or misleading information in the specific context of a parliamentary claim for allowances. Section 10(1) states that the offence will be made out with respect to the application of an MP where said MP:

Submits a claim under the MP’s allowances scheme, and
Provides information for the purposes of that claim the member knows to be false or misleading in a material particular.
The section 10 offence is triable either way, with the penalty in the event of both summary conviction and conviction on indictment being a sentence not exceeding twelve months imprisonment, a fine not in excess of the statutory maximum, or both.

Section 15

Section 15, sometimes referred to as the ‘renewal’ clause, provides that a number of PSA 2009 provisions will cease to have effect two years from the date on which section 8 enters into force unless they are renewed by order of a Minister of the Crown. The introduction of s.15 is a hedge against the possibility that function of IPSA and the Commissioner may have unforeseen consequences, given the fast-track nature of the Act’s passage into law.