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THE BLAIR SWITCH PROJECT

Tony Blair TONY BLAIR and accountants PricewaterhouseCoopers jointly helped push through a rule change in 2004 that brought the MPs’ expenses scandal to the heart of government. Without Blair’s new rule, explicitly designed to boost ministers’ expenses, many of the current frontbench embarrassments would not now be an issue. The Senior Salaries Review Board (SSRB) looked at MPs’ pay, using a survey of MPs prepared by PwC, and the firm was happy to support a point that Private Eye understands was pushed by the then prime minister. Its report said: “There were comments made about the rules which require ministers and other paid office holders to elect their London residence as the main residence and the constituency as their second property. The rules mean that the ACA [Additional Costs Allowance] is used against costs on a property which in many cases has been owned by the MP and his or her family for a significant number of years and where the mortgage is typically low.” Bad taste paint jobs  The report makes it clear that ministers had complained that because they were deemed to live in London, they could not “flip” homes in order to claim higher expenses; they could only claim on their generally cheaper properties outside the capital. According to the review board, the rule was dropped in February 2004. Hazel Blears’ property ladder, Maria Eagle’s flipping, Caroline Flint’s new London flat, the bulk of Shahid Malik and Shaun Woowdard’s expenses and Kitty Ussher’s war on “bad taste” swirly Artex paint finishes all depend on the 2004 rule change, as do the bulk of Gordon Brown’s own additional costs claims. Westminster property speculation  The Commons members’ estimates committee of senior MPs told Private Eye that it changed the rule in February 2004, reflecting the concerns in the PwC report. The former PM’s support for the change was no random act of greed (indeed, Blair did not personally use the change to raise money himself, relying instead on a complex mortgage transaction on his constituency home.) He was actually trying to increase his ministers’ income while publicly appearing to keep a lid on their headline pay. He did so by following a model set in 1985 by Margaret Thatcher, who, trying to hold back public sector pay and wanting MPs to appear to set a good example to teachers and the like, had introduced the crucial change in the Additional Costs Allowance which allowed MPs to begin claiming their mortgage costs rather than simply hotel bills or rents. Thus began the great Westminster property speculation game – Blair simply extending the perk to his London-based ministers who were always whingeing that they didn’t earn enough.

OTHER TOP STORIES IN THE LATEST ISSUE: - CALL CARTER-FUCK: One MP’s reaction to revelations about his dodgy expenses - THE FUTURE OF BANKING: Report for Alistair Darling concludes it’s going to look pretty much the same as the past - EYE TOLD YOU SO: Margaret Moran’s creative use of parliamentary resources… as revealed by Eye three years ago - KNOCKED ON THE HEAD: Gavel Basher says farewell (and good riddance) to Speaker Martin… - MAD NAD: Why MP Nadine Dorries is in two minds, as well as two homes, on all sorts of issues - DOUBLE ENTRY ACCOUNTING: Why Gordon wants government to keep two separate sets of books on PFI – but ‘transparency’ from the banks   To read these stories and more in full, buy the latest edition of Private Eye  or subscribeand have the magazine delivered to your home every fortnight.