Monday, 18 May 2009

Parly expenses

When Scots receive legal aid to prevent the repossession of their homes, the legal aid board expect them to pay all of that money back if they have made a notional capital gain in saving their home.

When I met Housing Minister Alex Neil recently, I argued that this was unfair as financially poor households were being told to pay back hundreds of pounds in legal aid when they were living on breadline benefits.

Mr Neil disagreed. He told me that it was morally right that those who had made a notional profit with the help of public funds should pay that money back.

Accordingly, will he and the other 27 MSPs who have made a notional profit from the Scottish Parliament's second homes allowance repay the public money they have received? The Herald (18 May) reports they have made an overall profit of £1.7m, with Mr Neil personally benefiting from a potential £95,505 profit.

I welcome Patrick Harvie's call for MSPs to relinquish any capital gains for the sake of the reputation of the Parliament, but would argue that the Scottish Parliament needs to change the rules to make it a legal requirement for MSPs to repay all second home allowance payments from capital gains.

A simple solution would be for the Scottish Parliament to secure an all sums due standard security on MSPs properties, so that when the property was sold the taxpayer would receive a full refund of mortgage interest relief payments. This would prevent capital gains being hidden, for example, by equity being taken out of the property by way of an increased first or second mortgage.

It is ridiculous for the First Minister to dismiss Scotland's expenses scandal as a 'legacy issue'. Firstly, there is nothing historic about 28 MSPs standing to trouser £1.7m thanks to the taxpayer, and secondly these MSPs will continue to get free mortgage payments until 2011.

Until this issue is resolved, the Scottish Parliament's nose is in the same trough as Westminster.

1 comment:

  1. This is a massive problem and one I hope will be addressed. I'm presently facing repossession and having taken legal advice have been told that I have an excellent chance of a reponing note being granted and time to pay granted at the subsequent court hearing.....but the lawyer is not prepared to do the work unless he gets the money upfront. Which if I had I'd use to clear the arrears.