Pricey Peers

Lord Lipsey

Some people are for turning the House of Lords from an appointed to an elected House of Lords, and some are against. The arguments bat to and fro; but one has so far received virtually no attention: the cost of the government’s proposals for election.  In the first five years reform could end up costing £433million, according to my detailed calculations. That’s enough for 80,000 hip replacements or a year’s salary for 21,000 nurses. Which, I wonder, would the public prefer? – a better health service or another gang of professional politicians.

The government gives no costing in its proposal (Cm 8077) but from published material, it is possible to work through the basic costing. At the moment Peers cost the taxpayer around £19 million per year in the daily allowance given to us based on attendance as well as any travel, office and other costs we claim. (The figure is based on an average cost per member per sitting found from the latest available quarter of HoL costs which can be found here:

The draft bill proposes that members of the reformed Lords will be either partly or wholly elected. In the first Parliament under the new system, there will be 100 new elected members while two-thirds of the current remain. At the current size of the house (828), that would mean a House totalling 652 members. The draft also states that all members of the reformed House will receive a salary. That is, both the 100 newly elected members and the remaining 552 ‘transitional’ Peers from the previous House (Para 109, Cm8077).

The bill says that the salary for these members should be somewhere between the salary for MPs and Members of the Scottish Parliament and Welsh Assembly (Para 111, Cm8077). Provisions for pensions will also have to be made. Taking the average of MPs’ and MSPs’ current salaries a reasonable estimate for Members’ salaries and pensions in the reformed House is around £79,500.

Based on this, the salary and pension expenses of the House in one year would come to £52million. That doesn’t include the other expenses that Members will have to be allowed to claim. A conservative estimate is that new Members would spend about two-thirds of what MPs currently spend on their expenses and that the old ‘transitional’ members would only use about a quarter of what MPs currently claim. For the existing peers this comes to £38,000 which is roughly what it costs to hire a secretary/PA in London

An important additional cost to include, however, is extra elections. The best  estimate is around £113 million. That’s based on the Government’s official estimate for the cost of the AV referendum (somewhere between £106 and £120million, available from Hansard, Col WA338, 18 May 2011). It could be higher since the proposals recommend an STV voting system which would probably need a heavy investment in electronic voting machinery.

Add all this up and over the first five years you get to £433m.
There’s no doubt that the House needs reform. I would be among the first to support the right kind of proposals and there’s no reason why they can’t be radical. The Lords needs better procedures, a more transparent method of appointing its members and, for sure, a cut in their numbers. A package of measures along these lines would save money – whereas the government’s proposals represent an extravagant way for the Conservatives to try to pacify Nick Clegg and his party.

19 comments for “Pricey Peers

  1. Lord Blagger
    22/06/2011 at 4:51 pm

    So lets abolish you. Over 5 years that 600 million. Lots of wonga for nurses. Far better spending the money that way than a nursing home for failed politicians.

    What’s the betting David Beamish signs an order making you attendance record a state secret because it will bring the Lords into disrepute?

    • Senex
      23/06/2011 at 11:49 am

      Lord Blagger nice to hear from you again; let me help you out here on the subjects of peers being paid a salary. The issue is Employers National Insurance. Your friends in the Commons for whom you never complain must have an employer by law that is unless HMRC leave that section of the paperwork blank and it is a state secret. Would this be the same employer that would pay members of the house? The constitutional arrangement between houses is one of complete separation but your friends down the corridor would have both houses answerable to the same employer in a master servant relationship. What have you to say on this?

  2. 22/06/2011 at 4:59 pm

    I lean toward the option of an unelected, but reformed House of Lords, mainly because the pro-elections lobby has yet to provide me with a good reason to have elections other than “it would be democratic”.

    No one explains why elections in of themselves would make the House any better at doing its job.

    Certainly reform would help – although it seems to be that the best reform would in the Other Place to stop it using the House of Lords as a dumping ground for unwanted MPs or to repaying favours from businesspeople.

    That an elected House would be vastly more expensive is interesting, but probably not one that will sway many people frankly – as they probably accept the cost as part of what being a democracy entails.

    Some argue that the Lords shouldn’t be amending laws without some form of democratic mandate.

    However, considering that the government carried out a consultation/U-Turn (delete depending on preference) about reforms to the Justice system, largely thanks to a dogmatic campaign by the tabloid newspapers – maybe we should be directing our gaze at the unelected newspaper editor?

    At least the Lords can ignore the tabloids, even if the Commons then overturns proposals from the Lords to appease those same tabloid newspapers.

    An unelected Lords is a necessary check on the awesome power of the tabloid newspapers to change government policy.

    • Senex
      23/06/2011 at 11:40 am

      Ian I’m sure you vote at general elections how effective do you feel your vote is from a personal perspective? I’m no longer as young as you but I see viciousness within the young just waiting for a demagogue to come along and exploit it.

      Enoch Powell could have been such a demagogue had he not been marginalised. What would have happened if Enoch Powell had risen on a tide of racial hatred to become Prime Minister of a party that blamed its failings on the new arrivals? I presume you would have been happy to see the house turn its legislative machine to oppose the government only to have it thrown out on the basis that it is not a legitimate chamber.

      There is more to governance than just legislation. These appointed peers have no conscience they stick their heads in the sand and hide behind a lack of accountability. They let bad things happen because they are powerless to stop them and they never complain. The constitutional precedent for them existing at all comes from a dark period in our history, Cromwell’s Republic.

  3. Gareth Howell
    22/06/2011 at 6:42 pm

    One of the key functions of a newly reformed Lords is to receive and discuss delegated legislation from the EU (European Union)
    It is an extra responsibility that parliament has not had until recently.

    It has to be paid for. I don’t think there is any magic in the figure £433m that the noble Lord Lipsey (How d’ya do my lord) quotes.

    There does seem to be a magic about the number 15 in all these deliberations. Having people elected for 15 years is laughable.
    It should be just like any US representative chamber. 2 terms of 3(5in our case) years at the most, and then out finito, caput, gone, end, finished, don’t come back, and for a little Spanish “Nada Más!”

    Otherwise corruption sets in as always.

    It is not as though the Ancients do not know how to lobby extremely effectively for their causes, and even have their own tame members in the other place. With a democratically elected second chamber, they may have wonder of wonders, a tame member in each!

  4. 22/06/2011 at 9:36 pm

    I’m glad to see a sensible estimate of the costs. We know what the public would prefer the money to be spent on (indeed, anything other than politicians’ salaries). Also, if asked, we know the sorts of issues they would rather the existing politicians spend their time debating.

    I hear proponents of an elected Lords saying that such reform was in the manifestos of all parties, so they have a mandate. Apart from the fact that voters can’t pick and choose individual issues, who exactly were the public supposed to vote for if they didn’t want an elected Lords?

    As you say, reform of the workings of the current House is needed, especially to reduce numbers following Brown’s and Cameron’s ridiculous number of new appointments. I’d even favour a system of more tightly controlling numbers of appointments. But more professional, career politicians? No thanks.

    • Senex
      23/06/2011 at 11:56 am

      Jonathan if the public were to pay peers a salary from their taxes they would want some accountability to the public. Why not! The public is paying them they should be answerable directly to the public. The house does not do accountability to the public it does accountability even in an appointed house to the establishment. The outlook for the weather is particularyly balmy do you not think?

  5. Senex
    22/06/2011 at 10:33 pm

    Good Lord you sound like Blagger! I entirely agree with you all the more reason to privatise the houses finances thereby removing the burden on the tax payer. Let the establishment pay for it! Hip. Hip. Hurrah!

  6. MilesJSD
    23/06/2011 at 12:09 am

    My constructive submissions for reforming Parliament, an indeed the Nation and World, into both Earth-Environmental & Participatory-Democratisation efficiency and sustainworthiness, have already been submitted to the Lords of the Blog since May 2010.

    These include, but as yet not in the following words, a clear mponetary-separation of Work-Costs & Expenses from Personal-Life -Income, the latter strongly arguably should be basicly no more than one-human-living per one-human-person/parliamentarian/peer.

    Nonetheless, there is one essential life-activity that has been recommended to me personally just this week, by an international health-educator (whom I could name but will not because that could be construed by your Hansard censors as being ‘advertising’) so I have just submitted the evidently-non-profit-activity address to Baroness Murphy’s latest blog, but it has not been published, and I might have got the link wrong there. .

    In it I suggest that the now-freely-available-online activity for “Ageless Grace” become a national-right and an easily affordable daily-practice, for all members of Parliament and of The Establishment, but most especially for all ages and levels of The People.

    I wish you one and all a lowering of your incomes into a personal-efficiency sustainworthiness bracket, quite distinctly of course from your Workplace-Costs-budgetings.


  7. Lord Blagger
    23/06/2011 at 10:21 am

    The existing corruption hasn’t been dealt with by the Lords, mainly because so many are at it. Namely expenses fiddles.

    Then you have the outright corruption of selling changes to legislation for cash. The Lords have slapped some wrists, but they still sit in the Lords affecting the law of the land. The Lords haven’t kicked them out for good. We still have crooks sitting in the Lords and turning up.

    They don’t want to reform because its too cosy. They like the cash. They don’t care about the public.

    What is being proposed is yet another stitch up. More money for them. No doubt pay offs as well. Redundancy for expenses.

    Then the political corruption steps in. Notice its all about party lists. Who decides who gets on a party list? Yep.

    Then there will be a threshold because we can’t have the BNP or heaven forbid, UKIP winning seats.

  8. Lord Blagger
    23/06/2011 at 10:22 am

    Peers cost the taxpayer around £19 million per year in the daily allowance given to us based on attendance as well as any travel, office and other costs we claim.

    False. You cost us about 115 million a year. You just trying to minimise the figure by ignoring all the other costs it takes to run you.

    • Senex
      23/06/2011 at 11:59 am

      The answer is privatise the house!

  9. Lord Blagger
    23/06/2011 at 10:52 pm

    The commons want it to be ambiguous. They are employed by the state, and then by Heisenberg’s principle, if someone else is looking, they aren’t.

    So they pass laws that say their expenses are exempt from income tax and scrutiny by HMRC.

    That’s why we need an equalities law added to the Human Rights Act. If MPs vote themselves a privilide, we all get it automatically.

    I would go farther. Double the pain, half the gain for MPs, councilors and laws.

  10. maude lewes
    25/06/2011 at 2:09 pm

    @Lord Lipsey:

    I am totally with you on that last paragraph.

    If you compare the cost of this to the cost of the European body we pay so heavily for, it comes off well.

    However, how much of the money given to the EU is handed back to many of the Lords in various covert practices that the British people are not allowed to know about? One can only assume it is for fear of retribution? And how many who receive large annual stipends from this same EU are hereditary peers?

    Is this amount added to the overall costs in your quote?

  11. MilesJSD
    28/06/2011 at 6:00 pm

    ‘Privitisation’ is no answer;

    simply because the consumption, and destruction-thereby, of three (3) Earths*, to sustain the ‘evolving’ economic-world-governance, is by no stretch of the honest human imagination a “Private” matter;

    it is very very much, and very urgently, a Public responsibility;

    and so must be the constitution and performance goals and remits of every Body of Governance.

    ‘Selling-out’ the House of Lords to a “Private” Boardroom (assuredly no better than the super-injunctions-protected RBS-bunch-of-bodging-bankers)
    would be an even worse disaster than the blindly-power-mad current Lower-House offensive to make that Upper-House “democratically-elected”.
    *Sky524 Discovery Science: “Ecopolis”
    (unfortunately in which Nobel prizewinning world-leading scientist Prof Kammen sets out to dismiss all remedies for making our Civilisation long-term
    “sustainworthy*”, except just one immediate “prize-winner” to be immediately-implemented in order to “save the world”.

    I can not believe that this Human Race on Earth can not afford to implement every one of the new and sustain-worthy remedies proposed to that programme “Ecopolis”;
    nor can I believe that Kammen’s finally-selected “one-only” will be sufficient, either.

    (* “sustainworthy” = my JSDM-submitted new term needing to be formulated more effectively than is the “Carbon-Footprint” so-called “eco-nomically measurable” one).

    • maude elwes
      30/06/2011 at 1:43 pm

      Privatisation of the Lords.

      Well, that would really make a difference wouldn’t it?

      Now we should consider paying an accountant to buy an off the shelf ‘House of Lords Ltd.’ which they will then use to select who will speak on behalf of the country, scrutinize legislation and put forward a coherent balance to the Commons. All at a lesser cost.

      As Mac of old would scream, whilst throwing down his racquet and sliding across the court after it, ‘you cannot be serious.’

      • Lord Blagger
        30/06/2011 at 4:27 pm

        It would work if it was structured right.

        Here’s an example of how not to organise a tender.

        Consider parking. Councils have to put it out to tender. A good thing. Councils then set the rules for the tender. Now you and I might think that the ideal criteria is how to minimise the price to the consumer. Not so with councils. Their tender criteria is how much they can gouge the consumer.

        A bit like the lords. What’s in it for them, not what it costs the taxpayer.

        So put it out to auction. I’ll bid. Hell, I might even contribute. I can’t sack the lords since they aren’t employed, but hey ho, I don’t have to pay redundancy either. 600 million saved for the government. Just a nod and no amendments. Its back to MPs to get it right.

        • maude elwes
          01/07/2011 at 1:51 pm

          @Lord Blagger:

          Well, if you think you have a good one, expand on it then.

          I can find a million pitfalls but, maybe I’ve missed something.

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