MP expenses: Are the rules clear?

Updated

Rorting of expenses is a big issue. In 2012 taxpayers shelled out a whopping $100 million in MP entitlements. More than a third of that was in travel expenses.

ABC Fact Check looked at this issue in October 2013, after several MPs paid back entitlements after questions were raised about what should and shouldn't be claimed.

Parliamentarians on both sides of politics - including Prime Minister Tony Abbott - had been claiming expenses to attend weddings, sporting events and even ski trips.

At the time, Communications Minister Malcolm Turnbull said the rules were "ambiguous at times" and that "it is not uncommon for people to pay expenses claims back".

But then Labor leadership contender Anthony Albanese said the rules were "pretty clear", and that in 17 years he'd never had to repay an entitlement claim.

Fact Check examined Mr Albanese's claim.

The claim: Anthony Albanese says the rules on MP entitlements are "pretty clear".

Anthony Albanese says the rules on MP entitlements are "pretty clear". The verdict: The rules are not clear. In the many documents describing how the system works, there is no definition of what constitutes parliamentary, electorate and official business.

The rules

There are 11 separate pieces of legislation that govern parliamentarians' entitlements. There are also three sets of regulation, six determinations by the Remuneration Tribunal and 21 determinations by the Special Minister of State.

A handbook has been produced as a one-stop-shop for members and senators to consult when it comes to filing a claim. The handbook contains more than 200 pages of copious advice with frequent references back to the legislation. There is also a separate handbook for ministers.

Sorry, this video has expired Video: Watch John Barron present the facts (ABC News)

The handbook says that while advice and assistance can be given by public service advisers, "it remains the responsibility of senators and members to satisfy themselves that their use of parliamentary entitlements is lawful".

"It is also in the senator or member's interest to satisfy themselves that the use is publicly defensible," it says.

In a report published in December 2004, the Australian National Audit Office said the Department of Finance "necessarily relies heavily upon self-assessment by parliamentarians" for "assurance that Commonwealth resources are only used within the terms of the relevant entitlements".

In essence, the set of rules governing entitlements relies on self-assessment. Parliamentarians must answer to themselves, and to the public.

Travel entitlements

Travel entitlements in particular have been landing parliamentarians in controversy.

The first page of the travel entitlement section of the handbook seems clear at first glance. It says parliamentarians may claim travel entitlements "in most circumstances only for parliamentary, electorate or official business, but not party business".

But how do senators and members define 'parliamentary', 'electorate' and 'official' business? This is the crux of the problem.

A 2009 review of the entitlements framework chaired by former bureaucrat Barbara Belcher examined the vexed issue of defining parliamentary, electorate and official business without bringing much clarity to the issue.

The Belcher review quotes a 1997 report by the Remuneration Tribunal, which said:

"The Tribunal considered the question of defining these concepts [of ministerial, parliamentary and official business] during the course of its annual review. It has decided, however, that it would be inappropriate (indeed improper) for it to define them to exclusion. Its position on this question essentially revolves around the due reticence which all in the executive arm of government must have that they do not impede the elected arm in the exercise of its function. While we can give an extensive list of examples of Parliamentary or electorate travel, any such list will not be exhaustive."

The review also found that in recent years the entitlement framework had developed "ambiguity" and "inconsistency". It found travel entitlements were arguably the most complex and ambiguous in the system.

The cost

The Department of Finance releases reports showing the total entitlements claimed by parliamentarians every six months.

The reports show parliamentarians were paid over $100 million in entitlements in 2012, with more than $35 million going to travel expenses.

A parliamentarian's entitlements are often referred to as his or her "other salary". The entitlements include car costs, office fit-outs, electoral staff salaries, telecommunications, family travel costs, overseas travel and travelling allowance.

Each month MPs and senators receive a private detailed report of their expenditure on entitlements. Every six months they receive a preliminary report from the Department of Finance for them to certify before it is posted on the internet. The certification includes saying the claim is allowed under the relevant legislation.

If there is any doubt about the legitimacy of the claim there is a help desk with an 'entitlements manager' available to assist.

A 2011 review into Administration of Parliamentary Entitlements was commissioned by the Department of Finance. It said: "Advice on entitlements, whether written or oral, can lack clarity or be inconsistent."

Matter of judgment

After the Belcher review was handed down in 2010, the government did make changes to the structure of parliamentarians' base salaries. But a key recommendation to consolidate the rules into one piece of legislation has not happened, a member of the review committee, Allan Fels, says.

Mr Fels also says the transparency of the entitlements claims process has not improved. He suggests one way to focus the minds of MPs would be for them to post all their expenses claims on their websites immediately.

Opposition Leader Tony Abbott recently said: "The point I make is that people should be careful and cautious when they claim entitlement. If there is any doubt, they should resolve the doubt in favour of the taxpayer and that is exactly what I have done."

Mr Abbott was referring to the repayment of $1,700 he had claimed to travel to the weddings of former colleagues Sophie Mirabella and Peter Slipper in 2006. He said he sought advice, and was told the entitlement was "unclear".

"I was the Leader of the House of Representatives and the Leader of the House of Representatives has certain representational roles and I believed it was within entitlements," he said.

After a number of MPs paid back their expense claims for another wedding, Mr Abbott decided to review his own records. "I decided that I should check. I was advised that the matter was unclear and, in order to put the thing beyond doubt, the money was repaid," he said.

Long-serving Liberal MP Philip Ruddock, who also claimed entitlements for attending Mr Slipper's wedding, said he would not be repaying the money. "Look, I have thought about it overnight and, quite frankly, my judgement at the time was that what I did was appropriate and I still think it was appropriate." Mr Ruddock says he went to the wedding because Mr Slipper was the chairman of the Committee on Legal and Constitutional Affairs.

"I went because he was the chairman of the committee that was working closely with me on a number of issues at that particular time and I was the Attorney-General," he said.

In this instance, two parliamentarians applied one set of rules to the same social function, but produced two different outcomes.

The verdict

The rules are not clear. In the many documents describing how the system works, there is no definition of what constitutes parliamentary, electorate and official business. It is up to individual members and senators to judge whether they are entitled to be reimbursed for travel to weddings, school fetes, iron man competitions, fun runs or charity events. Mr Albanese is incorrect.

Sources

Topics: anthony-albanese, federal-government, alp, federal-parliament, australia

First posted