IPSA decision on MPs’ pay
The Independent Parliamentary Standards Authority, IPSA, have now announced their decision in respect of the future of MPs’ pay. As the name suggests, IPSA is independent of Government and of MPs ourselves.
Before IPSA made its final decision, I set out my view about its proposals several times over the last year. I thought the proposals were ill-judged, particularly when average pay rises elsewhere were running lower than they are at the moment.
IPSA said they would review their decision after the election. They have now done so and announced, that, subject to a change in respect of the formula for future pay rises, they will go ahead with their planned changes. Here is the link to the IPSA report so you can see for yourself what it says.
My own view hasn’t changed from what I said last year. I also know it would be popular for me to simply respond to IPSA’s final decision by saying I will refuse to accept the rise IPSA are implementing. However, the reality of the situation is that it is not that simple.
I have three reasons for saying that:
My first reason is that IPSA was set up to be independent of Parliament so that never again MPs would be able to vote on our own pay and conditions. That is an important principle but if we now say we won’t accept IPSA’s decision because we think it is too much, what is to stop us doing the same on occasions when we think it is too little?
My second reason is that I and other Labour MPs have argued that where government has set up independent pay review mechanisms -for example in the case of nurses- they should accept the results. Ministers have not lived up to that in recent years but I think it is important for me to be consistent even if Ministers are not. In the case of independent review mechanisms it is important to always remember that accepting who has the right to make the decision is not the same as approving or disapproving of the decision itself.
My third reason is that IPSA’s review of what would be an appropriate pay rise for MPs to reflect changes in the cost of living or average earnings over the past year. It is about setting a long term framework not only for MPs pay but also for our pensions and other conditions. IPSA say that it is also self-financing, with the cost of the salary rise being offset by reduction in conditions elsewhere – for example in relation to MPs’ pensions. It is also being implemented as a package. As far as I know there is no mechanism for refusing to accept the pay increase and keeping everything else as it is.
Having established the new framework, IPSA have also announced that from now on, MPs pay will be pegged to a formula so that it rises in accordance with average pay rises for the public sector. In a letter to MPs this week, IPSA say that over the last Parliament, MPs had a pay increase of 2% compared to 5% across the public sector and around 10% in the whole economy.
As an MP, I have always used part of what I am paid through my salary to help subsidise my work representing people in Northfield. IPSA’s decision will make that a bit easier and I imagine my contributions to charity are likely to rise too. These will be personal and private decisions, and I do not claim they are somehow a way of refusing to accept IPSA’s decision. I hope this sets out some of my reasons for taking the view I have on IPSA’s announcement this week.