11% rise makes MP’s pay £74,000 a year
Ministers have condemned the controversial £7,600 rise in pay suggested by Ipsa (Independent Parliamentary Standards Authority). The pay rise would come in after the election in May 2015. After this date their pay should increase inline with the average household wage.
The extra £7,600 is said to balance their pension cuts and make up for their pay freeze over the last few years. In addition to this, research by Ipsa shows that two thirds of MPs believe that they are underpaid, even though they receive nearly three times the national average wage of £26,500.
One retiring MP supporting the pay rise is Jack Straw who said “What I’m concerned about is to ensure that the pay is sufficient to attract people from modest backgrounds who have not inherited a house, who don’t have family or personal income, but who are going to make a career out of politics.”
However, at a time when teachers, nurses and other public sector workers are accepting a 1% pay rise, it is not surprising that many MPs are worried about the effect or accepting of this pay rise. Andy Burnham, Labour MP, has described this rise as “wrong” and damaging to “what’s left of the public trust”.
Despite all three party leaders disagreeing with the pay increase when it was first proposed, Ipsa do not need to get their approval so it is unlikely to be reversed. Ipsa will have to review pay at the start of next parliament. In response to the “current difficult economic circumstances” Ipsa abandoned its previous plans to raise pay from its basic level of £66,396 to £73,365 or even £83,430.
The pay rise is said to cost the tax payer £4.6ml, but this should be offset by changes to their pension scheme (which should bring their pensions in line with other public sector workers), other changes to allowances and a squeeze on the so called “golden goodbye” payments.
Other changes to their pay include TV licences, contents insurance no longer being met for second homes, as well as taxpayer funded taxis being scrapped before 11pm.
Caroline Lucas, the Green MP for Brighton and Hove, had this to say about the pay rise that was being offered to MPs, “Accepting a pay rise of 11%, particularly at a time when so many of our constituents are struggling to make ends meet, would be absolutely wrong.
Many people who are in work are looking forward to either no pay rise next year, or at best another below-inflation increase, while many others are still without work.
MPs have to be in touch with the people they represent. That’s why I think an 11% pay rise sends out completely wrong message. I support the principle of an independent body to make decisions on MPs’ pay, but I had no idea the recommendation would be so out of touch with the economic reality. The system won’t allow me not to take the pay increase, so if re-elected I’d donate the extra money to a local charity.”