Allowances

Motion to Agree

Moved by

That:

(1) The Resolution of 27 March 2024 relating to the House of Lords allowance is amended as follows with effect from 1 June 2025.

(2) For paragraph 4 substitute—“(4) The maximum daily amount payable to a Member should be £125.”

(3) For paragraph (7) substitute—“(7) In relation to the year beginning with 1 April 2026, and each subsequent year beginning with 1 April—

(a) any formula or mechanism included in the IPSA determination for the year as a result of section 4A(4) of the Parliamentary Standards Act 2009 (adjustment of MPs’ salaries) should be treated as applying for the purposes of adjusting for that year the amount of the allowance payable to a Member of this House, and

(b) accordingly, the amount of the allowance payable to a Member in respect of a day of attendance in that year should be—

(i) the amount obtained by applying the formula or mechanism to the amount payable by way of allowance (under paragraph 4 or this paragraph) in the previous year, or

(ii) where no formula or mechanism is included in the determination, the same amount payable by way of allowance (under paragraph 4 or this paragraph) in the previous year.”

(4) In respect of a day of attendance before 1 June 2025, the Resolution of 27 March 2024 relating to the House of Lords allowance continues to have effect without the amendments made by this Resolution.

My Lords, I will speak to the second Motion at the same time, but I will move and speak to the third Motion separately.

In April 2024, the noble Lord, Lord True, as Leader of the House, moved a Motion to establish an overnight allowance to recognise the increased cost of staying in London, away from Peers’ main homes. That scheme set a rate of £100, which noble Lords based outside London could claim as a contribution towards the cost of a hotel. The scheme was welcomed across the House and followed representations from, and discussions with, those who chaired the main party groups and the convenor. It was agreed that it should be reviewed after about a year of operation, and these changes proposed result from that review.

The first change relates to the amount that can be claimed. The scheme was automatically uprated in line with inflation, so it is now £103 a night. It is hard to pick an exact amount, but this figure is not a realistic reflection of the cost of hotels across the capital. The commission therefore recommends an increase to £125 a night. This will continue to be uprated in line with inflation. As previously, claims are linked to attending the House on a sitting day, and receipts must be provided.

The existing scheme covers only hotel-type accommodation. Other noble Lords make other arrangements in London to enable their attendance in the House. The commission and the usual channels have considered this very carefully. We concluded that a new flat-rate allowance of 50% of the hotel allowance was the best way forward. This will again be tied to attendance in the House, with a robust system of verification. For noble Lords whose main address is outside London, they would be able to claim £63 per night to spend at a designated property in Greater London where they stay and are responsible for the costs. To claim, noble Lords must have stayed in the property the day before or the day after attending the House, and the finance team will require documentation to support the claim.

My Lords, I thank the noble Baroness the Lord Privy Seal for making this statement, which I think will be very welcome to the House. She referred to the discussions we had last year when I took the decision to put to the House the reintroduction of the overnight allowance. I was very grateful for her support on that, and I am very happy to reciprocate the full support from this side following the very careful consideration we have had of these issues in the usual channels and elsewhere, under the guidance of the noble Baroness.

It is always difficult to strike a balance, and I think that the commission, in its decision on the proposals put forward by the noble Baroness, has struck a reasonable balance which will support people who come to this House from all over the country, who wish to work hard on behalf of the House and on behalf of the country. Talking of hard work, I may say that my noble friend Lord Howe, who is next to me, last week completed 34 years on the Front Bench in your Lordships’ House. If that is not a definition of hard work, I do not know what is.

There is a lot of loose talk outside this House about people in this House being lazy and lining their pockets. You do not become rich by becoming a Member of the House of Lords; many people here make great sacrifices. We should not claim that we are poor or that we are underprivileged, but it is right that the House makes provision to enable those of us who come here to do a hard day’s work to enable us to do so in the most reasonable fashion. Obviously, there is a duty on us to behave with honesty and clarity, as we all do and will all do, I have no doubt, under these new proposals. I support them.

Rather than wearying the House, I say in advance that I strongly support the noble Baroness’s further Motion, because that also relates to hard-working and valued Members of the House. So again I thank the noble Baroness and commend these proposals unreservedly to your Lordships.

My Lords, I support this Motion. I have a very simple question for the Leader. Bearing in mind what happened during the period up to 2009, have the usual channels thought carefully about what the phrase

“where it is necessary to do so”

means? Will there be some sort of check, for instance, or will it be a pure self-declaration as it used to be before—which led us into a bit of trouble?

I am grateful to both noble Lords for supporting the Motion before the House. The noble Lord quotes “where it is necessary to do so”, but I am not quite sure where he is referring to in my comments or in the report. However, I think his point is about the verification, and I will address that first. He is right to address that because it must be a very robust process of verification. They will require a copy of the council tax statement, and for those many of those who have a second place in London where they stay, it will say “Second Home” on it; it specifies that it is not their main home. In addition to the council tax statement, there will of course be a record of people’s travel patterns back and forward to the House. So it is quite clear that if someone is travelling from another part of the country to stay in London for a few days to ensure they can carry out their duties in this House, that would be another point of verification. The noble Lord is right to raise the point, but this is why the commission took a long time to look at this, to give consideration to ensure that we were confident on that point.

I am grateful to the noble Lord, Lord True. Indeed, I supported him when he first raised this issue last time last year. There is a balance of responsibilities both to the taxpayer and to Members of this House, but we would be the poorer if the only people who could attend your Lordships’ House to undertake their responsibilities were those who either lived in London or had private finance to enable them to stay in London.

This is less than is received in other places in overnight allowance; it is a contribution towards it, and Members will use their daily allowance to pay the rest of it. I appreciate the support from both noble Lords, and I hope that Members will agree that this is a way forward if we are to represent not only those who can afford to live in London.

I wonder whether the noble Baroness can give me clarification. I use as an illustration my own situation, which I know is far from unique. I rent the use of a room in an apartment in London on an annual basis, but, as I read the Motion and the details in the financial support document, I will not be able to claim any reimbursement for the rent I pay for the use of that room. Is that so?

Depending on the circumstances, that may be the case. It is where somebody is responsible for paying more than just the rent for a single room. I do not know if the noble Lord is on the council tax bill or what other costs he incurs, but it is not for those who stay in rooms of family and friends. It is for hotel bills and for those whose name is on the council tax form to show that they are staying there. The noble Lord will have to discuss that with the finance team, but he may not be covered renting a room in a friend’s house.

Motion agreed.