March 24, 2009 12:27 am

Minister faces possible expenses inquiry

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Labour faced a fresh ministerial probe on Monday night as the parliamentary standards watchdog considered launching an inquiry into the expense claims of Tony McNulty, the employment minister.

A formal complaint was lodged against Mr McNulty by a Tory MP after it emerged that the minister used at least £60,000 ($87,400) of second home allowances to fund a property where his parents live.

John Lyon, the parliamentary commissioner for standards, will make a decision on the complaint against Mr McNulty this week.

Separately, Gordon Brown, prime minister, on Monday night attempted to limit the controversy by calling for a broad review of the system by the Committee on Standards in Public Life, an independent advisory body to government. The committee had confirmed on Monday morning that it was likely to start an inquiry into MPs’ expenses, although it would not start until the autumn.

Mr Lyon is conducting an investigation into Jacqui Smith, home secretary, after it emerged that she claimed expenses while lodging at her sister’s home.

Both Mr McNulty’s constituency home and his main home, where he spends almost all nights, are within 10 miles of Westminster. Mr McNulty admits the arrangement appears “odd” but he insists it is within the Commons rules.

After details of his claims emerged, Mr McNulty said the system was ripe for a shake-up. He plans to stop making further claims to cover the mortgage interest costs on his second home.

A series of revelations about MPs’ expenses have eroded public confidence in parliament and prompted repeated attempts to reform the self-regulated system.

But the biggest changes to the expenses regime – which permits an MP to claim up to £24,000 to maintain a second home – were heavily voted down in parliament.

On Monday, Downing Street said the prime minister had “full confidence” in Mr McNulty. He declined to discuss the details of the allegations, as they did not relate to the minister’s “government responsibilities”.

Alan Duncan, shadow Commons leader, said the allowance should be folded into MPs’ salaries – although he realised this would be politically unpalatable during a recession. “One day we are going to have to get rid of this allowance,” he said.

Nevertheless, Mr Duncan said there were “serious questions” over Mr McNulty’s arrangements, saying “the allowance is for a second home ... not for a constituency office”.

The Liberal Democrats urged MPs to “get rid of this charade” over allowances for MPs living within commuting distance.

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