House of Commons Committee on Standards and Privileges Mr Brian Binley
Fifth Report of Session 2009–10
Report and Appendices together with formal minutes
Ordered by The House of Commons to be printed 6 January 2010
HC 238 Published on 11 January 2010 by authority of the House of Commons London: The Stationery Office Limited £0.00
The Committee on Standards and Privileges
The Committee on Standards and Privileges is appointed by the House of Commons to oversee the work of the Parliamentary Commissioner for Standards; to examine the arrangements proposed by the Commissioner for the compilation, maintenance and accessibility of the Register of Members’ Interests and any other registers of interest established by the House; to review from time to time the form and content of those registers; to consider any specific complaints made in relation to the registering or declaring of interests referred to it by the Commissioner; to consider any matter relating to the conduct of Members, including specific complaints in relation to alleged breaches in the Code of Conduct which have been drawn to the Committee’s attention by the Commissioner; and to recommend any modifications to the Code of Conduct as may from time to time appear to be necessary.
Current membership Rt hon Sir Malcolm Rifkind MP (Conservative, Kensington & Chelsea) (Chairman) Rt hon Kevin Barron MP (Labour, Rother Valley) Mr Andrew Dismore MP (Labour, Hendon) Nick Harvey MP (Liberal Democrat, North Devon) Rt hon Greg Knight MP (Conservative, East Yorkshire) Mr Elfyn Llwyd MP (Plaid Cymru, Meirionnydd Nant Conwy) Mr Chris Mullin MP (Labour, Sunderland South) The hon Nicholas Soames MP (Conservative, Mid Sussex) Mr Paddy Tipping MP (Labour, Sherwood) Dr Alan Whitehead MP (Labour, Southampton Test)
Powers The constitution and powers of the Committee are set out in Standing Order No. 149. In particular, the Committee has power to order the attendance of any Member of Parliament before the committee and to require that specific documents or records in the possession of a Member relating to its inquiries, or to the inquiries of the Commissioner, be laid before the Committee. The Committee has power to refuse to allow its public proceedings to be broadcast. The Law Officers, if they are Members of Parliament, may attend and take part in the Committee’s proceedings, but may not vote.
Publications The Reports and evidence of the Committee are published by The Stationery Office by Order of the House. All publications of the Committee (including press notices) are on the Internet at: www.parliament.uk/sandp.
Committee staff The current staff of the Committee are Mr Steve Priestley (Clerk), Miss Rhiannon Hollis (Second Clerk) and Ms Jane Cooper (Committee Assistant).
Contacts All correspondence should be addressed to The Clerk of the Committee on Standards and Privileges, Journal Office, House of Commons, London SW1A 0AA. The telephone number for general enquiries is 020 7219 6615.
Mr Brian Binley 1
Contents
Report Page
Mr Brian Binley 3 Introduction 3 The Commissioner’s findings 3 Mr Binley’s rental arrangement 3 Mr Binley’s registration of interests 6 Mr Binley’s evidence 6 The basis for entering into a leasing arrangement 6 The time taken to reply to the DFA 7 The question of where responsibility lies 7 Mr Binley’s conclusion 8 Conclusions 8 Mr Binley’s request to be present at our deliberations 8 The basis for entering into a leasing arrangement 9 The time taken to reply to the DFA 9 The question of where responsibility lies 10 Overall conclusion 10 Recommendation 11
Appendix 1: Memorandum from the Parliamentary Commissioner for Standards 12
Appendix 2: Letter from Mr Brian Binley to the Clerk of the Committee, enclosing a statement, 30 December 2009 87
Formal minutes 97
Mr Brian Binley 3
Mr Brian Binley
Introduction
1. The Parliamentary Commissioner for Standards has sent us a memorandum, reporting on his investigation of a complaint against Mr Brian Binley, the Member for Northampton South. The Commissioner’s memorandum is reproduced in full at Appendix 1.
2. We have also received written evidence from Mr Binley, which is reproduced at Appendix 2.
3. The complaint against Mr Binley was that he claimed against the Additional Costs Allowance (ACA) for a property in Pimlico, London, which he rented from a company— BCC Marketing Services Ltd—in which he and his wife have an interest.1 With effect from July 2006, the rules of the House have prohibited Members from claiming for the costs of leasing accommodation from a company in which the Member—or the Member’s partner or family member—have an interest.2
4. Mr Binley was first elected in May 2005. He rented the Pimlico property between February 2006 and April 2009. The property was bought by BCC Marketing Services Ltd in December 2005 for Mr Binley’s use as a Member of Parliament.3 Mr Binley is the company’s non-executive chairman, receiving a salary of £8,000 per annum; he and his wife each own 20% of the company. Mr Binley’s son, who is the company’s managing director, owns a further 20%.4
The Commissioner’s findings
Mr Binley’s rental arrangement
5. As the Commissioner states in his memorandum, Mr Binley rented the Pimlico flat from BCC Marketing Services Ltd from February 2006 to 25 April 2009, during which period he renewed the lease annually and claimed the full rental cost of £1,500 a month against his Additional Costs Allowance. In total, Mr Binley’s claims against his ACA in respect of this property amounted to £58,500.5
6. The Commissioner notes that in November 2005 Mr Binley sought the advice of the then Department of Finance and Administration (DFA) about his plans to claim against his ACA for the cost of renting a flat from his company. It appears that Mr Binley was told that the proposed arrangement was permissible, although unfortunately neither Mr Binley
1 Appendix 1, paragraph 1 2 Appendix 1, paragraph 10 3 Appendix 1, paragraph 106 4 Appendix 1, paragraph 75 5 Appendix 1, paragraph 107 and WE9
4 Mr Brian Binley
nor the DFA confirmed this in writing at the time.6 The Commissioner has concluded that the arrangement was within the rules as they were in 2005.7
7. Mr Binley signed a twelve-month lease on the flat and started using it in February 2006. However, in March 2006, the DFA wrote to Mr Binley, informing him of proposed changes to the rules on ACA, which meant that the Department was no longer able to approve Mr Binley’s proposed arrangements.8 Mr Binley told the Commissioner that he challenged this ruling in May 2006, on the basis that at the time he had entered into the arrangement it had been within the rules. The Commissioner has questioned why it should have taken Mr Binley two months to respond and has described the failure to keep a copy of the letter of 25 May 2006 as “unfortunate.”9
8. The DFA replied in June 2006, stating that it was prepared to allow Mr Binley to continue claiming ACA on the property until the end of the 2006–07 financial year. The Commissioner describes this as un “unequivocal” statement, which set a “wholly reasonable deadline.”10 The letter concluded “You will therefore need to make alternative arrangements by the end of the 06/07 financial year.”11
9. The Commissioner has found no record of any further exchanges on this matter between Mr Binley and the House authorities between June 2006 and February 2008, when Mr Binley met the Director of Operations at the Department of Resources (successor to the DFA). He concludes:
… there is no evidence that Mr Binley took any significant action on this decision by the Department until he raised it again with them some 20 months later. He told me in oral evidence that he should have pursued it more effectively. I accept that judgement. … On the basis of the evidence, I cannot find that there was any sort of recognisable appeal process undertaken by Mr Binley against the Department’s decision in respect of his particular case over the period from June 2006 to February 2008.12
I consider it unacceptable that Mr Binley should have taken no significant action to respond to the Department’s decision of June 2006 until February 2008. He did not leave his flat by the end of March 2007 as the Department had ruled. Instead, he continued to make claims against his allowances for the rent of his flat, claims which he knew were not in accordance with the rules. The fact that he did not agree that the renting rules should have been changed mid-Parliament and that he wanted to
6 Appendix 1, paragraphs 108 and 119 to 122 7 Appendix 1, paragraph 122 8 Appendix 1, paragraph 109 9 Appendix 1, paragraph 123 10 Appendix 1, paragraph 124 11 Appendix 1, WE5 12 Appendix 1, paragraph 125
Mr Brian Binley 5
campaign to get this practice stopped, does not in my view provide any justification for ignoring the Department’s decision and continuing with his claims.13
The Commissioner also points out that the Department of Resources continued to pay Mr Binley’s claims after the deadline it had imposed had expired and that it failed to bring the matter to a head.14 The sums paid to Mr Binley from the ACA in respect of the Pimlico flat after April 2007 totalled £37,500.15
10. During the course of his meetings with House officials in 2008, Mr Binley acknowledged that the arrangements for renting the Pimlico flat were outside the rules, but argued that because the rules had changed after he had made the arrangements he should be allowed to continue to claim for the cost of renting the flat until the end of the current Parliament.16 The Department told Mr Binley that his arrangement must end by 31 March 2009 and that after that date the House would no longer meet his ACA claims for the property. Mr Binley asked for this advice not to be put in writing. However, following a relevant Report of this Committee in October 2008, the Department did put the advice in writing.17
11. Mr Binley appealed against this decision to the then Speaker in November 2008 and in January 2009 he asked for a meeting with the Speaker. The meeting took place in March 2009, following which it was agreed that the House would continue to meet the costs associated with Mr Binley’s use of the Pimlico flat until 30 April 2009. Mr Binley moved out of this accommodation on 25 April 2009 and has made no claims in respect of it after that date.18
12. The Commissioner considers that the further delay in resolving this matter between February 2008 and April 2009 was understandable in the circumstances. However, he also suggests that there was “no reason or justification for this matter to have been resurrected in 2008”, because it should have been dealt with by the end of March 2007.19 He continues:
I therefore conclude that Mr Binley was in breach of the rules of the House from March 2007 until he moved from his flat in April 2009 because he did not act on the Department’s clear instructions that by the end of March 2007 he should move out of, or stop claiming for, the flat which was owned by a company in which he had a leading interest. I therefore uphold the complaint.20
The Commissioner points out that “there is no evidence that the public purse lost out as a result of this arrangement. Mr Binley was fully within the rules in claiming for the rental costs of a property in London, the size of his claims was not excessive and they were within
13 Appendix 1, paragraph 126 14 Appendix 1, paragraph 127 15 Appendix 1, paragraph 107 16 Appendix 1, paragraph 110 17 Appendix 1, paragraph 111 18 Appendix 1, paragraph 112 19 Appendix 1, paragraph 130 20 Appendix 1, paragraph 131
6 Mr Brian Binley
the maximum provided for under the allowance.”21 He also accepts that Mr Binley gained no personal financial advantage from the rental arrangement. Nonetheless, he regards Mr Binley’s breach of the rules as a “serious matter” and suggests that Mr Binley made a “serious misjudgement” in his decision not to comply with the original deadline.22
Mr Binley’s registration of interests
13. In the course of his investigation of the complaint against Mr Binley, the Commissioner discovered that Mr Binley had received a registrable benefit. The benefit arose because the company from which Mr Binley leased the flat in order to perform his Parliamentary duties did not charge him for a range of costs, such as utilities and council tax, which under the terms of the lease fell to be paid by him in addition to the rent. The benefit exceeded the 1% of salary threshold for registration in each of the main calendar years of the arrangement—2006, 2007 and 2008.23 Mr Binley’s failure to register that benefit was a further breach of the rules.24
14. The Commissioner has told us that Mr Binley has accepted that the benefit should have been registered and that he has now made an appropriate entry in the Register of Members’ Financial Interests.25
Mr Binley’s evidence
15. Mr Binley has sent us a statement, in which he responds to the Commissioner’s conclusions. He also wrote to us, commenting on the complaints-handling process.26
The basis for entering into a leasing arrangement
16. Mr Binley’s first statement relates to the Commissioner’s conclusion that it was “imprudent” of him in February 2006 to enter into a leasing arrangement for the Pimlico flat without a written reply from the DFA to his letter of 22 November 2005.27 He points out that the Department confirmed orally at the time (in December 2005) and later in writing (in October 2008) that the arrangement was within the 2005 rules. Mr Binley was “shocked and angry” to receive the DFA’s letter of 23 March 2006, in which he was advised of the impending change to the rules. He has told us that “In the light of the slowness of the response from the Department I find it difficult to understand how I could have been more prudent.”
21 Appendix 1, paragraph 132 22 Appendix 1, paragraph 137 23 Appendix 1, paragraphs 133 and 134 24 Appendix 1, paragraph 136 25 Appendix 1, paragraphs 134 and 135 26 Appendix 2 27 Appendix 1, paragraph 121
Mr Brian Binley 7
The time taken to reply to the DFA
17. Mr Binley states that the two-month delay in his reply to the DFA’s letter of March 2006 was due mainly to his heavy workload as a new Member. He points out that, although no copy of his letter of 25 May has been kept, it was referred to in the Department’s letter of 5 June.
18. Mr Binley takes exception to the Commissioner’s conclusion that he took no significant action to respond to the Department’s decision of June 2006 until February 2008. He suggests that the relevant period is not the 20 months from June 2006 (the date of the last written contact between the Department and Mr Binley) to February 2008, but the ten months from the end of March 2007 (the deadline set for the end of his claims in respect of the Pimlico property) to February 2008. He states in his evidence to us that “important conversations were ongoing during the whole of that time although there is no actual record to prove whether I or the Commissioner is correct.” He quotes the reference in the 31 October 2008 letter from the Department to “a number of discussions” it had held with him “about reimbursement of your housing costs through the Additional Costs Allowance.”
19. Mr Binley also sent us a copy of a letter from the Department, marked “Private and Confidential”, which he obtained from another Member. The letter confirms that the Department logs only a minority of calls received from Members, mainly those which seek substantive advice.28 Finally, Mr Binley states that he was, at the same time as pursuing his own appeal, pursuing the wider matter of whether it was reasonable for major changes to the rules on allowances to be implemented during the lifetime of a Parliament. He saw the two processes “as part of the same appeal.”
The question of where responsibility lies
20. Mr Binley takes issue with the Commissioner’s conclusion that the primary responsibility for the breach of the rules rests with him. He repeats that he was in communication with the Department “throughout the whole process” and that the Department was “fully aware” of his situation. He draws attention to the letter to him of 31 October 2008, in which the Department “fully accept that you have acted properly at all times in respect of this matter.”29 He contends that, by continuing to pay his claims after the deadline set by it of March 2007 and by later setting further deadlines, the Department recognised that his appeal was active:
Under their responsibility to “interpret and enforce the rules” they had every power and a duty not to accede to my regular applications at anytime they thought appropriate but they chose not to do so. That can only be construed as giving assent
28 This letter is not printed as it is confidential to those concerned 29 Appendix 1, WE6
8 Mr Brian Binley
and agreeing that I was “acting properly” and the word ‘enforce’ implies the Department had predominance.
Mr Binley adds that at no time did the Department suggest that he should not claim or that he was acting improperly by continuing to claim.
Mr Binley’s conclusion
21. Mr Binley is “bitterly disappointed” with the Commissioner’s conclusion that for a period of 20 months he took no significant action to appeal against the DFA’s deadline, which he suggests “is built on a conviction which itself follows an assumption and that simply is not good enough.” He states that the conclusion that he bore primary responsibility for the breach “flies directly in the face of the edict from the Members Estimate Committee”, set out in the Green Book, that the Department was responsible for interpreting and enforcing the rules.
22. Mr Binley welcomes the Commissioner’s conclusions that neither he nor BCC Marketing Services Ltd misdirected public money and that there is no evidence that the public purse lost out. His statement concludes:
I am even more comforted by the fact that I acted in good faith throughout the whole matter, dealing honestly and openly with the Department at all times and therein lies my defence.
23. In his letter to us, Mr Binley wrote that the time given to him to respond to the Commissioner’s findings “was restricting in the extreme”. He did not request an opportunity to appear before us to give oral evidence, but he did ask to be present at our deliberations.
Conclusions
24. Before reaching conclusions on the Commissioner’s memorandum on this case, we wish to deal with each of the points put to us by Mr Binley.
Mr Binley’s request to be present at our deliberations
25. We did not assent to Mr Binley’s request to be present at our discussion of the Commissioner’s memorandum. To have done so would have been contrary to the long- standing practice of committees of the House that their deliberations are carried out in private. As an officer of the House, the Commissioner attends such meetings at our request, to answer any questions that we may wish to put to him on the content of his reports. A Member who is the subject of an investigation by the Commissioner has ample opportunity to make his case: first, in the course of the Commissioner’s investigation; then, should the complaint be upheld, in written or oral evidence to this Committee; and finally, should a sanction be recommended, on the floor of the House. Mr Binley was told that he could ask to attend the Committee to give oral evidence but he declined to do so.
Mr Brian Binley 9
The basis for entering into a leasing arrangement
26. We recognise that the DFA was dilatory in not replying promptly to Mr Binley’s letter of 22 November 2005 and that Mr Binley recalls that he chased the matter up by telephone in December. But Mr Binley should not have proceeded to sign a lease without written approval of his proposed arrangements. This was indeed imprudent, although Mr Binley has every right to feel let down by the Department.
The time taken to reply to the DFA
27. We have sympathy with Mr Binley’s comment that the workload he experienced as a newly-elected Member was the heaviest he had ever experienced in a new job. However, March 2006 was some ten months after the election and it is not unreasonable, in our view, to expect a new Member to have been on top of the job by then. Mr Binley should have been able to prioritise his work so as to ensure that he responded more promptly to the DFA’s letter of 23 March 2006.
28. As for the period between June 2006 and February 2008, we do not accept Mr Binley’s argument that the ten months prior to the expiry of the end March 2007 deadline should be discounted. This was precisely the period when, if he had a mind to make a formal appeal against the DFA’s ruling, Mr Binley should have been actively pursuing the matter. There is no evidence that he did so. The chronology of events agreed between the Commissioner and Mr Binley contains no reference to any action taken between 5 June 2006 and 20 February 2008.30 Mr Binley’s assertion that “important conversations” were taking place between him and the Department over this period is unsubstantiated by other evidence. The reference in the DFA’s letter of 31 October 2008 to “a number of discussions” about Mr Binley’s ACA claims was made eight months after the renewal of documented contact in February 2008. We do not feel able to place the same reliance on it as evidence of earlier substantive contact as Mr Binley does.
29. Mr Binley has told us that his appeal against the DFA’s decision in his own case was part of the same “appeal” as his campaign to change the Green Book rules so as to rule out major changes to the allowances regime during the lifetime of a Parliament. In our view, Mr Binley was unwise to link what should have been two separate processes. As the Commissioner has commented:
It is regrettable that, following this change in the rules in July 2006, Mr Binley did not separate out his personal position from his policy campaign, settle the one and, if he so wished, fight the other.31
30 Appendix 1, WE25 31 Appendix 1, paragraph 139
10 Mr Brian Binley
The question of where responsibility lies
30. Mr Binley has suggested that the authority given to the DFA in the Green Book to interpret and enforce the House’s rules “had predominance” over the obligation placed on all Members to ensure that their claims are at all times within the rules. We disagree. We accept that the DFA failed to enforce the rules relating to allowances. But this does not mean that Mr Binley was somehow excused from his duty under the Code of Conduct to abide by those rules.32 These are parallel, not overlapping provisions and in this case both parties separately failed to meet their obligations.
Overall conclusion
31. We agree with the Commissioner that Mr Binley breached the rules of the House relating to claims against the Additional Costs Allowance and that this was a serious matter—particularly so for the period from April 2007, when the deadline for bringing his second home arrangements within the revised rules had expired. The breach was sustained and it was deliberate, in that Mr Binley appears to have renewed his lease for a full twelve months on two occasions after the expiry of the deadline. We regard this, together with Mr Binley’s failure either to comply with the DFA’s determination of June 2006 or to pursue expeditiously his appeal against that determination, as a serious failure of his duty under the Code of Conduct to ensure at all times that his use of allowances provided from the public purse is strictly in accordance with the rules.
32. We conclude that the House authorities’ failure to act on the deadline they had themselves set for Mr Binley to bring his second home arrangements within the revised rules was equally serious and that it allowed a highly unsatisfactory state of affairs to continue for far too long. This failure does not absolve Mr Binley of his responsibilities, but it is something that causes us great concern.
33. As for Mr Binley’s failure to register the benefit he received by virtue of his company’s taking on of a range of costs associated with his use of the Pimlico property, we regard this breach as having been rectified. As the Commissioner has noted, the benefit was, in effect, transferred to Parliament, because Mr Binley would have been entitled to claim for these costs had he paid them himself. The public purse did not lose out.
34. Finally, we refute Mr Binley’s imputations regarding the complaints-handling process. The Commissioner’s investigation has, as we would expect, been meticulous and fair. Mr Binley has been kept fully informed at all stages of the process and he has been afforded every opportunity to put across his views.
32 The Code of Conduct, HC 2008-09 735, paragraph 14
Mr Brian Binley 11
Recommendation
35. For breaching the rules of the House by claiming against allowances for the cost of renting a property from a company in which he has an interest, we recommend that Mr Binley apologise unequivocally in writing and that he repay the sum of £1,500. The fact that Mr Binley neither sought nor gained any personal financial advantage from his rental arrangement, which cost no more and probably less than the alternative arrangements that would have been open to him, is a mitigating factor. The failure of the Department to enforce its decision of June 2006 is another, significant mitigating factor, because it allowed Mr Binley to maintain the position that his rental arrangement was being tolerated. Were it not for these mitigating factors, we should have invited the House to consider imposing a more severe sanction.
12 Mr Brian Binley
Appendix 1: Memorandum from the Parliamentary Commissioner for Standards
Contents Page
Complaint against Mr Brian Binley MP 14 Introduction 14 The Complaint 14 Relevant Provisions of the Code of Conduct and Rules of the House 14 My inquiries 17 Findings of Fact 37 a. The rental arrangement 37 b. Registration 39 Conclusions 40 a. The rental arrangement 40 b. Registration 43 c. Overall conclusions 43
Written evidence received by the Parliamentary Commissioner for Standards 45 1. Letter to the Commissioner from Mr Michael Barnbrook, 17 June 2009 45 2. Extracts from article in the Daily Telegraph, 17 June 2009 46 3. Letter to Mr Brian Binley MP from the Commissioner, 22 June 2009 47 4. Letter to the Commissioner from Mr Brian Binley MP, 30 June 2009 49 5. Letter to Mr Brian Binley MP, from the Assistant Director of Operations, Department of Finance and Administration, 5 June 2006 52 6. Letter to Mr Brian Binley MP from the Director of Operations, Department of Resources, 31 October 2008 53 7. Table of Expenditure on London property by BCC Marketing Services Ltd 55 8. Letter to Mr Brian Binley MP from the Commissioner, 2 July 2009 55 9. Letter to the Commissioner from Mr Brian Binley MP, 10 July 2009 56 10. Letter to Department of Finance and Administration from Mr Brian Binley MP, 22 November 2005 56 11. Letter to Mr Brian Binley MP from Assistant Director of Operations, Department of Finance and Administration, 23 March 2006 57 12. Letter to Mr Brian Binley MP from the Financial Director of BCC Marketing Services Ltd, 29 August 2008 57 13. Letter to the Speaker from Mr Brian Binley MP, 26 November 2008 58 14. Letter to Mr Brian Binley MP from the Speaker’s Secretary, 18 December 2008 59 15. Letter to the Speaker’s Secretary from Mr Brian Binley MP, 19 January 2009 59 16. Letter to Mr Brian Binley MP from the Director of Operations, Department of Resources, 13 March 2009 60 17. Letter to Mr Brian Binley MP from the Commissioner, 14 July 2009 60 18. Letter to the Director of Operations, Department of Resources, from the Commissioner, 14 July 2009 60 19. Letter to the Commissioner from Mr Brian Binley MP, 24 July 2009 61
Mr Brian Binley 13
20. Letter to the Commissioner from the Director of Operations, Department of Resources, 27 July 2009 61 21. Extracts from Internal Memorandum to Department of Resources’ staff from the Director of Operations, Department of Resources, 25 April 2008 62 22. Letter to the Director of Operations, Department of Resources, from the Commissioner, 30 July 2009 62 23. Letter to the Director of Operations, Department of Resources from the Commissioner, 4 August 2009 63 24. Letter to the Commissioner from the Director of Operations, Department of Resources, 10 September 2009 63 25. Mr Brian Binley MP - Chronology of Events 65 26. Note of telephone conversation between Department of Finance and Administration advice team and Mr Brian Binley MP, 22 November 2005 66 27. Note of telephone conversation between Department of Finance and Administration advice team and Mr Brian Binley MP, 22 November 2005 66 28. Extracts from letter to all Members from the Director of Operations, Department of Finance and Administration, 25 July 2006 67 29. Letter to Mr Brian Binley MP from the Commissioner, 11 September 2009 67 30. Letter to the Commissioner from Mr Brian Binley MP, 15 September 2009 68 31. Letter to Mr Brian Binley MP from the Commissioner, 25 September 2009 69 32. Statement from Financial Director of BCC Marketing Services Ltd, 12 October 200969 33. Letter to Mr Brian Binley MP from the Commissioner, 29 October 2009 70 34. Letter to Mr Brian Binley MP from Financial Director of BCC Marketing Services Ltd, 2 November 2009 71 35. Agreed note of interview with Mr Brian Binley MP, 5 November 2009 71 36. Letter to Mr Brian Binley MP from the Commissioner, 11 November 2009 85 37. Letter to the Commissioner from Mr Brian Binley MP, 25 November 2009 85 38. Letter to Mr Brian Binley MP from the Commissioner, 2 December 2009 86
14 Mr Brian Binley
Complaint against Mr Brian Binley MP
Introduction
1. This memorandum reports my conclusions on a complaint that Mr Brian Binley, the Member for Northampton South, made claims against the Additional Costs Allowance for a property rented from a company in which he and his wife had an interest, contrary to the rules of the House.
The Complaint
2. Mr Michael Barnbrook wrote to me on 17 June 200933 complaining that, according to an article in the Daily Telegraph of that date, Mr Binley had claimed £1,500 a month against parliamentary allowances to rent a flat owned by “his own company”, BCC Marketing Services.34 In his view this was contrary to the House’s rules prohibiting Members from renting properties from themselves or from companies owned by them. Mr Barnbrook stated that, according to the newspaper article, Mr Binley had been told by the Commons authorities that he was in breach of the rules in April 2006, but that after appealing to Mr Speaker, he had been permitted to continue claiming against his allowances. Mr Barnbrook said that it was only in April 2009 that the Speaker had ruled that the claims must stop. Mr Barnbrook noted that the newspaper article stated that Mr Binley had not yet had to repay the £57,000 he improperly received while the Speaker deliberated.35
Relevant Provisions of the Code of Conduct and Rules of the House
3. Paragraph 14 of the Code of Conduct for Members of Parliament provides that:
“Members shall at all times ensure that their use of expenses, allowances, facilities and services provided from the public purse is strictly in accordance with the rules laid down on these matters, and that they observe any limits placed by the House on the use of such expenses, allowances, facilities and services.”
4. The rules and provisions relevant to the use of allowances in respect of Members’ accommodation are set out in the Green Book on Parliamentary Salaries, Allowances and Pensions. The complaint related to claims from February 2006 to April 2009. The relevant rules in the Green Book were, for a short time, those published in April 2005 and, from July 2006, those published that month.
5. Mr Speaker, in his introduction to both editions, wrote as follows:
33 WE 1 34 WE 2 35 Ibid.
Mr Brian Binley 15
“Members themselves are responsible for ensuring that their use of allowances is above reproach. They should seek advice in cases of doubt and read the Green Book with care. In cases of doubt or difficulty about any aspect of the allowances or how they can be used, please contact the Department of Finance and Administration. The Members Estimate Committee, which I chair, has recently restated the Department's authority to interpret and enforce these rules.”
6. The rules for the Additional Costs Allowance are set out in Section 3 of both editions. The rules for 2005 set out the scope of the Allowance as follows:
“The additional costs allowance (ACA) reimburses Members of Parliament for expenses wholly, exclusively and necessarily incurred when staying overnight away from their main UK residence (referred to below as their main home) for the purpose of performing Parliamentary duties. This excludes expenses that have been incurred for purely personal or political purposes.”
7. Eligibility is set out in paragraph 3.2.1 as follows:
“You can claim ACA if:
a You have stayed overnight in the UK away from your only or main home, and
b This was for the purpose of performing your Parliamentary duties, and
c You have necessarily incurred additional costs in so doing, and
d You represent a constituency in outer London or outside London.”
8. Paragraph 3.11.1 gives examples of allowable expenditure including:
• “Rent - on one additional home in either London or the constituency. (If you claim for a rental deposit you must repay this when the deposit is returned to you.)
• Mortgage costs - for one additional home in either London or the constituency. This is limited to the interest paid on repayment or endowment mortgages, legal and other costs associated with obtaining (and selling) that home (eg stamp duty, valuation fees, conveyance, land searches, removal expenses)
…
• Utilities
— heat
— light
— water
— council tax
...
16 Mr Brian Binley
• Maintenance & service agreements
— necessary repairs to make good dilapidations
— decoration
• Cleaning
• Insurance
— buildings and contents”.
9. Paragraph 3.12.1 sets out expenses which are not allowable, including:
“The costs of leasing accommodation from yourself”.
10. The July 2006 rules introduced a number of principles in paragraph 3.3 of Section 3, as follows:
“3.3.1. Principles
You must ensure that arrangements for your ACA claims are above reproach and that there can be no grounds for a suggestion of misuse of public money. Members should bear in mind the need to obtain value for money from accommodation, goods or services funded from the allowances.
3.3.2.
You must avoid any arrangement which may give rise to an accusation that you are, or someone close to you is, obtaining an immediate benefit or subsidy from public funds or that public money is being diverted for the benefit of a political organisation.
3.3.3.
ACA must not be used to meet the costs of a mortgage or for leasing accommodation from:
• yourself;
• a close business associate or any organisation or company in which you—or a partner or family member—have an interest; or
• a partner or family member.”
Mr Brian Binley 17
11. The Guide to the Rules relating to the conduct of Members which was in force from 2005 to 200936 provided for the registration of gifts, benefits and hospitality under category 5. It advised in paragraphs 28 and 29 as follows:
“28. The specified financial value above which tangible gifts (such as money, jewellery, glassware etc.), or other benefits (such as hospitality, tickets to sporting and cultural events, relief from indebtedness, loan concessions, provision of services etc.) must be registered is 1 per cent of a Member’s annual parliamentary salary.
“29. The rule means that any gift, or other benefit, which in any way relates to membership of the House and which is given gratis, or at a cost below that generally available to members of the public, should be registered whenever the value of the gift or benefit is greater than the amount specified above. Any similar gift or benefit which is received by any company or organisation in which the Member, or the Member and the Member’s spouse or partner jointly, have a controlling interest should also be registered.”
My inquiries
12. Having considered carefully the complainant’s letter, I concluded that he had provided me with sufficient evidence of a potential breach of the rules of the House to justify an inquiry.
13. I wrote to Mr Binley on 22 June to invite his comments on the complaint.37 I noted that the essence of the complaint was that he had made claims against the Additional Costs Allowance for property which he had rented from a company in which he and his wife had an interest. I invited Mr Binley to let me know why he had identified his London residence as the one against which to make ACA claims; the dates and details of financial arrangements in respect of the property; why he had decided to make the reported arrangement with the company, BCC Marketing Services Ltd, and what the details were of the ownership of that company; what claims he had made against the ACA for this property from February 2006 to March 2009; why he had considered that the arrangements in February 2006 were within the rules of the Green Book published in April 2005, and whether he had consulted the House authorities on this question; why he had considered that the arrangements were within the rules published in the revised Green Book of July 2006, and what consultations he had had with the House authorities about this; when he first became aware, if that was the position, that the House authorities considered that the arrangement was not within the revised rules and what the sequence of events was which reportedly had led him to appeal to Mr Speaker about this advice; and how and when the situation had been finally resolved, including any reasons for the length of time it appeared to have taken.
36 The Code of Conduct together with the Guide to the Rules relating to the Conduct of Members 2005, HC 351 37 WE 3
18 Mr Brian Binley
14. Mr Binley responded with his letter of 30 June.38 He attached three documents.
15. The first document was a letter from the Assistant Director of Operations in the Department of Finance and Administration (now the Department of Resources) dated 5 June 2006.39 That letter advised that, as discussed with Mr Binley, at the time Mr Binley made his arrangement, the Green Book did not state that it was against the rules to rent from a company in which the Member had an interest. But the revisions which were planned to be published in July 2006 would make this practice against the rules. The letter said that Mr Binley would need, therefore, to make alternative arrangements by the end of the 2006-07 financial year. He could continue claiming on the property until then. The letter also suggested a review of Mr Binley’s situation in the autumn of 2006.
16. The second document was a letter from the Director of Operations, dated 31 October 2008.40 It referred to “a number of discussions” which the Director had had with Mr Binley. Having set out the evolution of the Green Book rules, the Director said that, in his opinion, Mr Binley’s arrangement contravened the Green Book rules published in July 2006 (paragraphs 3.3.2 and 3.3.3). This meant that “the House cannot continue into the future” to meet the rental payment. The letter noted: “I fully accept that you have acted properly at all times in respect of this matter.” But it continued: “as we have discussed, the House cannot agree to your current housing arrangements continuing for the remainder of this Parliament.” It noted that “earlier this year” the Director had proposed that by the end of that financial year (April 2009) reimbursement of rent for the property “must come to an end”. If Mr Binley chose not to move, “the House would not meet rental payments for this property from April 2009 onwards.”
17. The third document which Mr Binley enclosed was a schedule detailing expenditure by BCC Marketing Services and by Mr Binley on the flat.41 It showed that, in the period from 2006 to 2008, the total expenditure on the property by BCC had been £68,274. The income from Mr Binley was identified as £58,500. £9,774 was identified as the deficit.
18. In his letter of 30 June 2009, Mr Binley said that he had identified his London residence for his ACA claims because his family home was in the Northampton South constituency. His London residence had been rented “simply to pursue my role as a Member of Parliament.” He had leased the flat from BCC Marketing Services Ltd. They had bought the flat in December 2005 “in order to help me”. The purchase had been made following discussions with the Department of Resources in the autumn of 2005, when it was “verbally confirmed that the arrangements met the requirements of the Green Book at that time.” Mr Binley said that he moved into the property at the beginning of February 2006. He claimed a rent of £1,500 a month. The rental price included council tax, water rates, electricity and gas costs. The company bought all the furniture, white goods and other furnishings used in
38 WE 4 39 WE 5 40 WE 6 41 WE 7
Mr Brian Binley 19
the flat. It had taken out an interest-only mortgage for £345,000 (which was the cost of the purchase).42
19. Mr Binley noted from the schedule which he had enclosed that “the whole transaction showed a deficit of expenditure over income of £9,774, confirming that the company made not one penny of profit from the taxpayer but instead registered a loss. Consequently the taxpayer got a good deal which was equally beneficial to my family and myself.” Mr Binley said that he had decided to accept the arrangement which had been offered to him by his fellow directors, because he did not “want to cause my wife stress in this regard should anything untoward happen to me during the period of the lease.” He noted that his wife and he together owned 40 per cent of the shareholding in BCC Marketing Service Ltd, which he had founded in 1989. Other identified shareholders owned 40 per cent and 20 per cent respectively. “In other words my wife and I together were not majority shareholders in the company.”
20. Mr Binley noted that the changes in the Green Book rules which impacted on this matter had not been brought to his attention until 23 March 2006, “even though I had been given verbal assent to the arrangements in autumn 2005 and I proceeded to sign a lease pursuant upon that decision.” Mr Binley added: “Recognising that my arrangements were now in contravention of the rules but equally recognising that I had already committed myself to a long-term lease, I felt I was in an impossible situation.” In consequence, he sought permission to appeal against the rule change. He felt “very strongly that rule changes of this nature impacting upon contractual arrangements” should not take precedence over those arrangements. He therefore appealed to the Department of Resources “as was my right”. Mr Binley said that: “they agreed to continue to pay the claimed rental during the period of lengthy correspondence which thereafter ensued between myself and the Department of Resources.” That correspondence culminated in a letter dated 31 October 2008. Mr Binley quoted from that letter.43
21. Mr Binley said that he then made a “final appeal to the Speaker” based on a general principle in the newly published Green Book agreed in January 2009 that: “Major changes impacting on any issue which might require Members to enter into any long-term arrangements or materially affecting the guidance or rulings contained in this document, should be designed to last for the lifetime of a Parliament and not changed mid-term.” Mr Binley said that the Speaker had informed him verbally in March 2009 that he had rejected his appeal, but he offered to allow him to claim rent for a further period until 30 April 2009 so that he could find another flat, “which I duly did”. He noted that “sadly, the new arrangement is more expensive for the taxpayer than the previous arrangements had been.” Mr Binley said that he wished to “confirm that my family and I did not receive a penny of benefit from the arrangements which they would not have received had I rented the property from another source. However, my company did subsidise my living arrangements.” He
42 The Financial Director of BCC Marketing Services provided more accurate information on the mortgage. See WE 32 43 See WE 6 and paragraph 16 above.
20 Mr Brian Binley
therefore felt that his actions “were honourable and the interests of the taxpayer were fully protected”. He considered “the concept of personal honour to exceed all other values.”
22. Mr Binley noted that his “campaign to ensure that rule changes were not imposed midway through a Parliament was vindicated in the new Green Book published in March 2009.” He noted that “four major changes to the Green Book rules” had been made since the publication of the April 2005 Green Book and “that fact alone highlights the unacceptable nature of the process employed during my four years in this House.” Mr Binley said that “The lodging of an appeal in almost all legal contexts invariably requires the preservation of the status quo.” Had the Department not agreed to continue to honour the payment of rent for his accommodation pending the determination of the appeal to the Speaker, the “objective of the appeal” would have been defeated. He would have been obliged to move to another property. He said that it was “well understood and agreed” that, during the period House of Commons authorities were considering his submissions, “for the length of which I was not responsible”, he should continue to be reimbursed on the property. He noted that that agreement had been expressed in the letters of 5 June 200644 and 31 October 2008.45 Money paid to him would have been paid in any event and “each claim was met by the Department of Resources with its full knowledge and agreement of the circumstances of my appeal.” In his view, therefore, there could be “no legitimate case for deciding that I should have to repay any or all of these sums, and thus to bear the full cost of accommodation that was wholly and exclusively necessary for me to fulfil my parliamentary duties.”
23. I considered that I needed some additional information. Accordingly I wrote to Mr Binley on 2 July,46 requesting copies he might have of any other relevant correspondence, including his own letters to Departmental officials. I also asked him for a copy of the lease and any other documentation which identified arrangements for early release or termination. In view of the subsidy which Mr Binley said that BCC Marketing had given him, I said that I would need to consider whether this raised an obligation on him to have registered that benefit in the Register of Members’ Interests. I set out the relevant provisions in the Guide to the Rules.47 I invited Mr Binley to comment on the registration aspects of the matter.
24. Mr Binley responded in his letter of 10 July.48 Mr Binley said that he was not sure that all of the letters transacted between himself and the Department of Resources were included in the files but unfortunately there was little he could do about that. Secondly, he said, “much of the transactions were done either verbally, at meetings or on the telephone.” He noted that whilst those conversations were not recorded “as you will understand they were very important.”
44 WE 5 45 WE 6 46 WE 8 47 The Code of Conduct together with the Guide to the Rules relating to the Conduct of Members 2005, HC 351 48 WE 9
Mr Brian Binley 21
25. Mr Binley asked me to note that in his original letter of November 2005 he had said that the company “wished to use the property for their own use also, but it was later discussed in one of the conversations that the flat could not be used in that way and consequently it never has.” He said that in his view the rent was not a benefit in kind as he was charged a commercial rate. He continued: “The truth of the matter is had I continued to rent the property over a longer period the shortfall experienced by the company would have been eradicated; certainly there was no intention of subsidising me. I just make the point that contrary to the company making money out of the situation the obverse was the case.”
26. With his 10 July letter, Mr Binley also supplied ten enclosures, which he said were “all of the further copies of correspondence we have in our files”. These included a copy of the lease for the flat, dated 30 January 2006.49 Mr Binley also enclosed a letter which he had written to an official in the Department and dated 22 November 2005.50 Mr Binley said in the 2005 letter that he had spoken to a colleague of the official the previous day about his plans to lease a flat in Pimlico for the remainder of his term in the House. The colleague had suggested that, whilst he felt the details of that lease “would not create a problem”, nonetheless Mr Binley should write to the Department so that they could cast their eye over the arrangement and ensure that the matter was properly cleared through formal channels.
27. Mr Binley’s letter said that the flat would be owned by BCC Marketing Services, a company Mr Binley had founded in 1989. Mr Binley’s personal holding in the company was 20 per cent of the total share issue and he remained, as Chairman of the company, on a director's salary of £8000 a year. In addition, Mr Binley’s wife acted as company secretary and also owned 20 per cent of the shareholding. The remaining shares were held by: [Financial Director], 20 per cent; [wife of Financial Director], 20 per cent; and [Managing Director], 20 per cent.
28. Mr Binley’s letter said that the company was buying the two-bedroom flat because it had a need for both the Managing Director and the Financial Director to stay in London on regular occasions, and because it provided him with an opportunity to lease accommodation at a “sensible rate as opposed to continuing to stay at the Carlton Club.” The cost would be some £1,250 per month, “which provided both a flexible and cost- effective alternative to my present arrangements.” Mr Binley concluded by asking the official to review the information he had provided and confirm that the proposal fell within the parameters laid down for Members.
29. Mr Binley also enclosed with his letter of 10 July a letter from the Assistant Director of Operations at the Department dated 23 March 2006. It stated that the Department had been awaiting the outcome of the Members Estimate Committee meeting of 27 February 2006 which considered proposed changes to the rules for the ACA.51 The Assistant
49 Not reproduced here 50 WE 10 51 WE 11
22 Mr Brian Binley
Director’s letter said that one of the changes agreed by the Committee was that the ACA “must not be used to meet the costs of a mortgage or for leasing accommodation from:
• yourself;
• a close business associate or any organisation or company in which you—or a partner or family member—have an interest; or
• a partner or family member.”
30. The Assistant Director’s letter said that a new edition of the Green Book incorporating these changes would be available in the late spring, but in the meantime, as a result of this decision, “I am afraid I am not able to approve your proposal.”
31. Mr Binley also attached another letter from the Department dated 3 March 2008, inviting Mr Binley to a meeting, following his meeting with the Director of Operations of 20 February and the Director’s subsequent discussions with senior Officers of the House.52
32. Mr Binley enclosed a letter to himself dated 29 August 2008 from the Financial Director of BCC Marketing Services stating that the company had taken the decision to purchase the flat at a Board meeting at which Mr Binley was present; that the reasons for so doing were to derive an income from ownership and possibly enjoy a long-term appreciation in value; that Mr Binley was charged an annual rent of £18,000, which was “a fair rent” in the view of the Board, granting no pecuniary advantage to Mr Binley; and expressing the Board’s happiness for Mr Binley to remain in the accommodation.53 Also enclosed was an email of 19 September 2008 in which Mr Binley requested a meeting with the Director of Operations.54
33. Mr Binley enclosed his letter to Mr Speaker of 26 November 2008.55 This said that in December of 2005, some eight months after Mr Binley was elected to the House and following advice given to him over the telephone by the Fees Office, the Company of which he was a Director bought a flat in Pimlico for £358,000, which he arranged to rent.
34. The letter said that the share capital of the Company was owned by Mr Binley (20 per cent) his wife (20 per cent) the Financial Director (20 per cent) the Financial Director’s wife (20 per cent) and the Managing Director (20 per cent). Mr Binley said that the company bought all of the furniture, crockery, cutlery and other household items “which turned the flat into a London home.” In addition, they also paid the rates, electricity, gas and cleaning bills. “In other words, not one iota of parliamentary money has been spent on those items,” Mr Binley said.
52 Not reproduced here 53 WE 12 54 Not reproduced here 55 WE 13
Mr Brian Binley 23
35. In return, Mr Binley’s letter said, he was charged an annual rental of £18,000, paid monthly, which equated to approximately £346 per week, a rental figure which he said “I am sure you will agree is an excellent deal for the taxpayer and sizeably less than if I were to rent from another source, or indeed stay in a hotel.” Mr Binley continued that a Members Estimate Committee meeting on 27 February 2006 had changed the rules governing rental of property in this manner. On 5 April of that year, Mr Binley had received a letter advising him of that change.56 Mr Binley had thereafter met with the Director of Operations at the Department of Resources and explained his objections “both to the fact that rule changes of this kind, affecting long term contractual issues should not in all fairness be made mid term and particularly after new entrants have made decisions of a long term contractual nature as described above.” He had also argued that he had obtained no pecuniary advantage from this rental through his membership of the Board. And he had argued that the amount of money received by way of rental covered only a minority of the interest-only mortgage taken out by the company to make the original purchase.
36. Those discussions with the Director had, Mr Binley’s letter said, continued for some time and culminated in the letter from the Director of Operations written on 31 October 2008, which he copied to Mr Speaker.57 He said that “I might add that I believe the new rules governing this point are unhelpful, not least in a situation where if a family member or close associate worked for a bank or a mortgage company, presumably making it impossible for a Member of the House [to borrow] money from that bank or company which to be truthful is a ludicrous situation.”
37. Mr Binley’s letter said that his real concern, however, was that it was necessary for him to cease renting the property as from the end of the current financial year, which he took to mean 31 March 2009. “I do not need to tell you that this places me in a very difficult position.” This was, Mr Binley’s letter said, firstly, because of the present financial situation: forcing his company to sell the property “could mean a sizeable loss for those close associates who had agreed to buy the property to help me in the first instance.” It was also, Mr Binley’s letter said, because he had won the seat in 2005 with a 4,400 majority and boundary revision meant that that majority had been lost. There was “a distinct possibility that I will cease to be elected at the next election and this will create a quandary in itself for I could not possibly take on another lease in the knowledge that at most I will be taking it on for 12 months. However if an election were called earlier then we could be talking a matter of 2 months and to move in those circumstances would be onerous indeed.”
38. Mr Binley’s letter said he had been told that he could appeal against the decision of the Fees Office to “the final arbiter of these issues, your good self, and I consequently make that appeal to you.” He said that he recognised that he could not argue to continue the present situation longer than the present Parliament but he would equally state that to make a change before that time would create sizeable hardship and difficulty in the way explained.
56 WE 11 57 WE 6
24 Mr Brian Binley
“My appeal therefore is to allow the arrangements, which I was told were within the spirit and the letter of the rules when I entered into them, to continue until the end of this Parliament.”
39. Mr Binley’s letter said that his record showed that he treated taxpayers' money with great care. “Indeed for the last year that records were produced I was in the bottom third of all Members of Parliament in this respect.”
40. Mr Binley sent me the reply from the Speaker’s Secretary of 18 December 2008.58 This said that Mr Speaker had studied closely Mr Binley’s letter to him of 26 November and would “happily talk further with you in the New Year.” The Speaker’s Secretary recognised that Mr Binley had taken advice and followed the rules in December 2005 and that he had become aware that the rules had changed in February 2006 (to be effective July 2006) when the Department wrote to him in a letter which he received on 5 April 2006.59 The Speaker’s Secretary’s letter noted that “Between now and then you have discussed the matter regularly with [the Director].”
41. The letter from the Speaker’s Secretary then said that “Mr Speaker is concerned that, as things stand, you will be placed in a difficult position if, after 31 March 2009, you remain in the arrangement against the rules and having had nearly three years' grace since learning that they will be changing.” The Speaker’s Secretary said “Mr Speaker asks that you go and see [the Director]. If it helps, please come back to Mr Speaker again, but time is short.”
42. Mr Binley also enclosed his reply to the Speaker’s Secretary of 19 January 2009.60 In this he thanked the Speaker’s Secretary for “the implied interest”, and said he was most appreciative. Mr Binley said he had already had a series of meetings with the Director of Operations at the Department of Resources who suggested that he ask the Speaker for a brief meeting “in order to be able to appeal against a decision which he feels he must pursue on the basis of the present Green Book, but which would be overruled on the basis of the new Green Book, which hopefully be adopted later this week.” Mr Binley asked the Speaker’s Secretary if he could arrange for a short meeting of 15 minutes “to allow me to appeal on the basis of my difficult predicament, which will cost myself and others a great deal of money through no fault of my own.”
43. Finally, with his letter to me of 10 July 2009 Mr Binley enclosed a letter dated 13 March 2009 to him from the Director of Operations at the Department of Resources.61 In this he thanked Mr Binley for advising him of his recent conversation with Mr Speaker, and confirmed that the House would continue to meet costs associated with his current flat until 30 April 2009. He attached examples of those items of expenditure which Members
58 WE 14 59 WE 11 60 WE 15 61 WE 16
Mr Brian Binley 25
with rented second homes were able to claim under the current rules of the Additional Costs Allowance.
44. Having considered these documents carefully, I wrote again to Mr Binley on 14 July 2009 asking him to confirm that I was right in concluding from sight of the letting agreement that Mr Binley’s lease was on a 12 month renewable basis expiring on 1 February each year. I also told him that I was proposing now to consult the Department of Resources and would consider any registration issues further with the Registrar of Members’ Financial Interests 62
45. On the same day I wrote to the Director of Operations at the Department of Resources63 asking for his comments and advice on Mr Binley’s case and the documents I had received from him to date; and requesting copies of documentation of the Department’s correspondence and meetings with Mr Binley over the period in question and a summary of his ACA claims. I asked for the Director’s view on why Mr Binley’s arrangements ceased in March 2009, although he had been informed of the Department’s rejection of his arrangement in March 2006.
46. On 24 July I received a reply from Mr Binley.64 He confirmed that his contract was renewable annually, and repeated his concerns about the effect of rule changes on arrangements made over a long term. He said that the Fees Office “kindly recognised this fact by continuing to pay me until March 2009 when the appeal process finally came to an end.”
47. The Director of Operations at the Department of Resources replied to me in his letter of 27 July.65 The Director noted the correspondence between Mr Binley and the Department and his letter to Mr Binley of 31 October 2008 which set out the Department's position.66 The Director of Operations said that the position was that the arrangement was within the Green Book rules when entered into in February 2006. Mr Binley was then notified of a likely change to the Green Book in June 2006 and the new rules came into effect in July 2006. Mr Binley was given until 31 March 2007 to make alternative arrangements.
48. The Director continued “For reasons not entirely clear to me this timetable for making alternative arrangements was allowed to slip.” However, he said, it was relevant that in February 2008 my investigation into the circumstances of Sir Nicholas and Lady Winterton's ACA claims began, in which Sir Nicholas and Lady Winterton questioned the Department's interpretation of the Green Book and its right to enforce this interpretation through ceasing to pay ACA. The Standard and Privileges Committee report of 18 June
62 WE 17 63 WE 18 64 WE 19 65 WE 20 66 WE 6
26 Mr Brian Binley
200867 was clear about the proper interpretation of the rules and in its view of the necessity for the Members—and by extension others in a similar position—to make alternative arrangements.
49. The Director of Operations told me he first had contact with Mr Binley in February 2008. At a subsequent meeting with him in March he had made it clear that the Department “required him to move from his current address if he was to continue to claim ACA into the future. I indicated that I considered that the House could not continue to pay ACA for his current second home beyond March 2009. I wrote to Mr Binley on 31 October confirming the position.”
50. The Director then said that in November 2008 Mr Binley “chose to make representations to the then Speaker of the House about the Department's decision. Mr Speaker Martin felt unable to support Mr Binley's case and notified him accordingly.” Given the elapsed time, the Director of Operations had agreed to a suggestion that the timetable for ceasing ACA for the London property be extended by one month to 30 April 2009. The Director said that Mr Binley moved accommodation on 25 April and no claims were met in respect of the London property after that date.
51. The Director enclosed with his letter a summary of Mr Binley's claims for the last four years.68 This confirmed that Mr Binley claimed £1,500 a month for rent for the period of his lease of the flat from February 2006 to April 2009. The Director also enclosed an internal memo from him following his March 2008 meeting with Mr Binley.69 This recorded that at the meeting the Director had told Mr Binley that it was “not possible” for Mr Binley’s arrangements to continue up to the next election. He said that he had agreed with the Clerk “that his [Mr Binley’s] arrangement… must end by 31 March 2009. After this date we will no longer meet his ACA claims for this property.”
52. The Director’s memo said that Mr Binley had “accepted this advice. He asked that it not be put in writing; but he fully understood the position (although he didn't agree with our ruling) and accepted that the House would not extend the arrangement beyond this date.”
53. I wrote again to the Director on 30 July,70 saying that I needed to be clear about the chronology of events and to understand the background to the length of time it took to cease payment of the Additional Costs Allowance in respect of Mr Binley’s second home. I said that I needed also, where possible, to see the documentary evidence which substantiated the chronology. I sent him a table setting out the chronology of events as reflected in the information the Director of Operations and Mr Binley had given me, and asked him to confirm this chronology – or add to or amend it as necessary, including documentary evidence.71 I wrote again to the Director on 4 August inviting his comments
67 Committee on Standards and Privileges, Twelfth Report of Session 2007-08, HC 744 68 Not reproduced here 69 WE 21 70 WE 22 71 Not reproduced here (but see final version at WE 25)
Mr Brian Binley 27
on Mr Binley’s letter of 24 July72 in which he said the Department “recognised” his argument, and on his interpretation of the Department’s views.73
54. The Director of Operations replied to my letters of 30 July and 4 August in his letter of 10 September74. He enclosed his revised version of my chronology 75 and said that the chronology demonstrated that throughout the period in question the Department’s “basic assessment” of Mr Binley’s claims was the same, “namely that that they were outwith the rules in force at the time or outwith the rules about to come into force”. The letters from the Assistant Director of Operations of 23 March76 and 5 June 200677 were clear that Mr Binley’s claims for rent could not continue indefinitely. However, at this stage the new rules had not been formally codified into a revised Green Book and Mr Binley had, “understandably perhaps”, chosen not to act in anticipation of such changes to the rules. Following the issuing of the new Green Book in July 2006, however, no immediate action was taken either by the Department or Mr Binley to bring to an end the payment of rent for the London property in question. In the Director’s discussions with Mr Binley in February and again in March 2008, the Director said that he had reiterated the Department’s view of the position and set a new deadline for Mr Binley for the arrangements to come to an end.
55. The Director also noted that during this time the Department's attention was also on a similar case involving Sir Nicholas and Lady Winterton. The Department's interpretation of the Green Book in this case was being closely scrutinised. The Director continued by saying that “Notwithstanding the element of uncertainty that existed, my view at the time was that it was right to leave in place the deadline I had set Mr Binley to leave the London property.” The Director’s letter of 31 October 2008 therefore merely documented the understanding between Mr Binley and himself, including restating the Department's position in respect of his claims after 31 March 2009.78 The timeframe, he said, recognised that Members could not easily and quickly change their London home arrangements and some transitional period was appropriate.
56. The Director said “I hope this demonstrates that from March 2006 through to October 2008 the Department was entirely consistent in its interpretation of the Green Book and entirely transparent in this in its dealings with Mr Binley. Thus, 'recognising' Mr Binley's arguments was no more than expressing the view that these were not without merit.”
57. The Director added a number of other enclosures to his letter of 10 September. These included notes of two telephone calls from Mr Binley to the Department on 22 November 2005, in which he had asked for advice on whether he could, within the rules, lease a flat in
72 WE 19 73 WE 23 74 WE 24 75 See final version at WE 25 76 WE 11 77 WE 5 78 WE 6
28 Mr Brian Binley
London purchased by a company of which he and his wife were 20 per cent shareholders, and had been requested to put the details in writing to the Department in order to receive a definitive ruling.79
58. The Director also enclosed a copy of a letter from himself to all Members, dated 25 July 2006, advising of changes to the Green Book and enclosing copies of the new edition.80 This drew Members’ attention to changes to the ACA. The Director also enclosed the full copy of a letter of 23 March 2006 from the Assistant Director of Operations to Mr Binley, the first page of which had been supplied to me by Mr Binley with his letter of 10 July.81
59. I wrote to Mr Binley on 11 September inviting his comments on the Director’s letter and its enclosures, and on the accuracy of the chronology I and the Department had constructed.82 I particularly drew his attention to the fact that the Department had advised that Mr Binley’s claims were outwith the rules in force at the time, or outwith the rules about to come into force. I also noted that it was the Department’s view that the arrangement was within the rules when Mr Binley entered into it in February 2006.
60. Mr Binley replied to me on 15 September, saying that he was happy with the general accuracy of the Department’s chronology and believed that it “overwhelmingly” coincided with his understanding of the situation.83 He noted, however, that there was no comment with regard to his general concern that Members should not be expected to change long- term contractual agreements within the period of a Parliament. He said he was “delighted” that the Department had again confirmed the “correctness” of his second home arrangements. He observed that the judgement of the Fees Office was “vital” with regard to the correctness of a particular claim and the very fact that in their letter of 31 October 2008 the Department had “laid down an initial period for which they agreed to pay rent intimated to me that I could correctly claim for that rent during that defined period.” In that letter the Director had “specifically stated that I had done nothing wrong up to that point but that he could not allow the payment of rent for my existing flat beyond the end of the financial year”.
61. Mr Binley welcomed the Director’s confirmation that he had the right to appeal to the Speaker and thereafter acted on the Speaker's ruling immediately and that following further discussions, the Director “kindly allowed him a further short period of grace in order to vacate the flat I was renting from the company of which I was a minority shareholder thus confirming again the Office's power to allow a claim or otherwise.”
62. Given those lengthy involvements with the Fees Office and the fact that their authority was clearly established by their own actions, Mr Binley said, “I simply fail to understand
79 WE 26, WE 27 80 WE 28 81 WE 11 82 WE 29 83 WE 30
Mr Brian Binley 29
where any wrongdoing might have occurred and I am therefore hopeful that you will come to the same conclusion.”
63. On 25 September I wrote to Mr Binley, letting him know the outcome of the consideration which the Registrar of Members’ Financial Interests had given to the question of whether he should have registered any benefit from his accommodation arrangements in his company flat in the Register of Members’ Financial Interests.84 I noted that Mr Binley had said in his letter of 10 July85 that the rent was not a benefit in kind as he was charged a commercial rental, that if he had continued to rent the property over a longer period the shortfall experienced by the company would have been eradicated and that there was no intention that the company should subsidise him.
64. I noted that in his letter of 30 June86 Mr Binley had told me that he paid to BCC Marketing Services Ltd £1,500 a month which included council tax, water rates, electricity and gas costs and that the company bought all of the furniture, white goods and other furnishings used in the flat. The company had taken out an interest-only mortgage for £345,000 (the cost of purchase) at the time of purchase and the interest payment when he embarked on the arrangement amounted to £1,600 a month.
65. On this basis I said it would seem that, in the first year at least, there appeared to have been a benefit to Mr Binley of £100 a month (or £1,200 in the year), excluding the contribution which would need to be made in this monthly rent to the company’s purchase and initial furnishing costs. I had, however, not been able to reconcile this figure with the figures for the first 39 months which Mr Binley annexed to his letter of 30 June and which showed an overall deficit of £9,774. Setting aside the necessary contribution to the company’s costs of purchasing and furnishing the property, it would seem that Mr Binley’s rent exceeded the costs by £7,708 over the 39 months.
66. I asked Mr Binley to provide me with a calculation by calendar year of the company’s costs (including the amortised purchase and initial furnishing costs). I also asked him if he could check the total running cost figures he had provided (parking, lighting and heat, insurance, council tax and water) since some appeared quite low for a 39-month period. That would enable me to compare the annual cost of the apartment with the annual rental income (which I understood was £18,000).
67. On 12 October Mr Binley wrote to me enclosing a statement made by the Financial Director of BCC Marketing Ltd, which set out the background to Mr Binley’s rental of the London property from the company from January 2006 to April 2009.87 The Financial Director said the leasehold flat had been purchased in December 2005 for a basic price of £345,000. Stamp Duty of £10,350 was paid together with various legal and professional fees
84 WE 31 85 WE 9 86 WE 4 87 WE 32
30 Mr Brian Binley
of £3,134. The total of £358,484 was capitalised in the company's books. As the leasehold was in excess of 100 years it has not been thought necessary to amortise the lease in the company accounts. A deposit was paid by the company and the balance of £297,000 was provided by a repayment loan.
68. In order to set a level of rent, the Financial Director said, telephone calls had been made to estate agents in the Pimlico area. The general consensus of opinion was that for a flat of that value in that area, an annual amount of £18,000 would seem to be appropriate. This figure was applied, according to the Financial Director, so that Mr Binley, as a director of the company, would not be subject to a benefit in kind.
69. The Financial Director enclosed some schedules relating to the flat, showing the expenses incurred, the loan interest and the rent paid from February 2006 to April 2009.88 The Financial Director demonstrated that BCC “suffered a deficit from the rental in 2006 (£2,656), 2007 (£3,450) and, to a lesser extent, in 2008 (£133).” A gain of £3,346 had arisen in the short period in 2009 when Mr Binley continued living in the flat. The Financial Director said: “These figures would have been the same had the flat been let on the open market as the rent was set at normal commercial rates.”
70. Since the flat was vacated by Mr Binley in April 2009 it had been re-let to unconnected persons at a rent of £385 per week, or £20,000 per annum. This would indicate, the Financial Director believed, “that the rent set three years earlier was a true market rent at that time.”
71. I wrote to Mr Binley on 29 October saying that I had consulted the Registrar of Members’ Financial Interests and that what followed reflected her advice.89 I observed that the figures provided by the Financial Director of BCC Marketing Services suggested that in the first two years of the arrangement the company made a significant loss, with a smaller one in the third. This raised the question of whether Mr Binley had received a benefit by virtue of this loss.
72. I went on to note that the purpose of the Register was “to provide information of any financial interest or other material benefit which a Member receives which might reasonably be thought to influence his or her actions …. taken in his or her capacity as a Member of Parliament”. I pointed out that the question was not only whether Mr Binley had received a benefit, but whether he might reasonably be thought to have received one. The Register was compiled on the basis of whether or not a Member received a registrable benefit within a calendar year. Under the rules current from July 2005 until July 2009, Members were required to register, under Category 5, “any material benefit of a value greater than one per cent of the current parliamentary salary, from any company, organisation or person within the UK, which in any way relates to membership of the House”. In 2005 the relevant figure was £590, in 2006 it was £600.
88 Not reproduced here 89 WE 33
Mr Brian Binley 31
73. In the light of this summary of the relevant rules, the Registrar’s view, which I emphasised was provisional at that stage, was that it would have been appropriate for Mr Binley to have registered a benefit in 2006 and 2007, since the difference between his rental payments and the company’s outgoings on the flat exceeded one per cent of the annual parliamentary salary.
74. In response, Mr Binley sent me a copy of a letter of 2 November, which he had received from the Financial Director of BCC.90 In it the Director said that the schedules of loss and gain which he had forwarded did not show the increase in the value of the company investment in the London property. The Board of Directors had “regularly monitored” the letting arrangement during the course of Mr Binley’s tenancy and was always satisfied that any deficit in revenue was more than compensated for by an increase in the capital value. Despite the fall in residential property values in certain areas in recent times, the Financial Director said, the Board was satisfied that the current value of the property exceeded the purchase price. This was confirmed, in his view, by the fact that the flat was currently being let at a rental of £20,000 per annum, reflecting the increase in capital value. It was the view of the Board that at no time did the company suffer an overall deficit during Mr Binley’s tenancy and that therefore, Mr Binley could not have received any benefit.
75. I arranged to interview Mr Binley on 5 November, while I consulted the Registrar on the Financial Director’s response, which I did not receive until Mr Binley gave it to me at the interview. When I met Mr Binley, I confirmed with him that BCC Marketing Services Ltd was founded by Mr Binley and that over the period 2006–2009 he had held a 20 per cent shareholding, as did his wife. I noted that his son, the Managing Director, held a further 20 per cent. Mr Binley was non-executive chairman and he was paid £8,000 per year.
76. Mr Binley said that he had consulted the Department of Finance and Administration [DFA] in writing in the autumn of 2005 and a few days later rang them and was told orally that it was acceptable for him to rent the company flat and to claim the full rent under the ACA. The company bought the flat in December 2005 and then furnished it; Mr Binley’s rental arrangement began in February 2006.
77. Mr Binley confirmed to me that in March 2006 he had been told in writing by the Department that his arrangement was not acceptable under the Green Book rules about to come into effect. He had challenged that ruling in May 2006 and was told in June 2006 that he had to bring the arrangement to an end by March 2007.
78. I suggested to Mr Binley that he had taken no action on this decision until February 2008, when he had again challenged the ruling. He replied that “There were a number of discussions with the Department”, but “I realise that I can’t prove these conversations. And not all the letters are included in the files.” He confirmed that he had been told in a meeting with the Department of Resources of 26 March 2008 that the arrangement must end by 31
90 WE 34
32 Mr Brian Binley
March 2009. Mr Binley had spoken on the telephone to the Department over the summer of 2008 and had had a meeting in October 2008, after which the Director of Operations said to him in a letter that the arrangement must end by 31 March 2009.
79. Mr Binley confirmed that he had appealed to the Speaker in November 2008. In March 2009 his appeal had been rejected, but he was allowed to continue claiming for the firm’s flat until the end of April 2009, when he moved. Mr Binley said that he could not disagree that he had challenged the ruling three times—in May 2006, in February 2008 and in November 2008—but he told me that “I saw the whole process as an appeal. As I have explained, it was about changing the rules mid term. The appeals process was wider than implied by those three dates.”
80. In explaining his thinking behind the arrangement he had come to, Mr Binley said: “I am eighteen years older than my wife. I was 63 when I came into Parliament. I felt that to take out a liability at that stage would place her in more difficulties should anything untoward happen. I had an offer from members of my Board, because travelling up and down with a suitcase each weekend was getting hard work. I put the offer to the Fees Office who recognised that I was not renting from myself.” He had thought of renting from someone else, “but I didn’t want to go through the process of looking for somewhere. And I was then living in the Carlton Club which was not satisfactory by any means. When the offer came about it seemed attractive, and having as landlords people I know seemed an advantage. I went to the Fees Office, they said it was okay, so I proceeded.”
81. Mr Binley said he had discussed with the Department the possibility of sharing the use of the flat with fellow directors of his company, but had been told orally that that was not acceptable, although renting the company flat would be allowed. There had been a number of conversations but no written confirmation from the Department of the acceptability of his renting arrangement. Mr Binley said; “I was not as careful as I ought to have been. In the light of what I know now, I would have asked for a letter each time.” He said that he had only come in to the House on 5 May 2005 and was [at the time] overwhelmed by the experience.
82. Mr Binley said that he had not expected the Department’s letter of 23 March 2006 in which he was told that his London flat arrangement would not be within the new rules. He said that he did not accept the advice of the Department to find another flat because he had signed a lease for the Pimlico flat.
83. Mr Binley acknowledged that the lease was for only a year, but continued: “Yes, but it is also about the ambience. People—my Board—were helping me out. Having got them into that situation, I felt that there was a responsibility on me. I had accepted a situation they were not knowledgeable about. I owed it to them to take things further.” Mr Binley said he could see no reason why the House of Commons “should not act decently. That is why I campaigned so hard. People should know where they stand.” He said “My constituents have sent me here to fight injustice. I have fought it all my life. It seemed wrong to change contractual arrangements mid term, not least within months of being given the go ahead.”
Mr Brian Binley 33
84. Mr Binley observed that he had accepted what the Fees Office had said originally about his arrangements as “totally credible and meaningful”. He said that to find that the advice stood only for a matter of months was “outside the world of reality” as he knew it in business. On that basis he had appealed.
85. Mr Binley accepted that it would have been possible for him to have moved out earlier if he had wished, but he observed, “I was saying that this was wrong and I wanted it reviewed. If I had moved the reason for my appeal would have ceased to have any meaning.” Mr Binley said it had taken two months, from March 2006 to May 2006, for him to challenge the Department’s decision, because: “Parliament takes more of my time and attention than anything else I have ever done. There are so many things crowding in on you. Things take an order of precedence; some things are urgent and they get done in that order.” There were phone calls, although he could not be specific about the details, and there were “other conversations that took place”.
86. Mr Binley said that he had circumstantial evidence that he had appealed the decision: “I refer to the Director of Operations’ letter of 31 October 2008, when he said that there were ‘a number of discussions’”. He then observed that “The importance of all this has grown enormously. The ambience attached to expenses has grown. We are in a changed world. Would I, knowing what I now know, do it differently? Yes I would. But I was a relatively new Member. I should have pursued it more effectively and I didn’t.” In explaining why he had not gone to the Speaker until 26 November 2008 to appeal against a decision letter of 5 June 2006, Mr Binley said: “Well, if you take into account the three months when this place closes down in the summer, it looks less dramatic.” And, he said, “There were conversations but no record. So I have no evidence of my actions.” He said,“I saw the whole process as an appeal process. I intimated my appeal at different stages.” Mr Binley said that the conversations which had started in February 2008 were “still about the correctness of changing the rules mid term. Officials would come back to me and I would come back to them.” He believed he could make the Department reconsider his claim.
87. Although he had referred in his letter to me of 15 September 2009 to the judgement of the Fees Office being “vital”, Mr Binley said that he did not accept their judgement on the propriety of his arrangements because he felt it was a battle worth fighting. He pointed out that the Department did keep paying his claims; as the “enforcement authority” they could have stopped paying him at any time.
88. Mr Binley said that, although he could not now prove it, “We were having a conversation.” Had the Department ceased to pay him, he would have “gone to the Speaker”. The circumstantial evidence of his appeal was that the Department kept paying him and “the Director agreed to go on doing so. That suggests to me an agreement to continue. If not, they could have stopped paying me. They were the enforcers.”
89. Mr Binley said that successive Green Books were full of confusing statements. “I didn’t in any way want to cheat the taxpayer. The change of rules did fly in the face of reasonableness. I have in part won my case, which proves that. The whole thrust of my argument [about avoiding mid-term changes to the rules] was written into the April 2009
34 Mr Brian Binley
Green Book. I am grateful for that … except that the Green Book changed materially only a few months later, in July 2009, when the detail of the rules was changed again.”
90. Mr Binley was unable to say who had initiated the conversations which had taken place between him and the Department of Resources in February 2008. However, there were conversations going on, he told me. They had been better documented in 2008, as “the ambience of the Fees Office was changing then. The searchlights were already pointing at that area.” Over eight months between February and October 2008 there had been a number of discussions, and Mr Binley said that they were both policy discussions on the general point about changing the rules mid-term and conversations about his own situation. He told me “I was advised early on by a lawyer that if I moved out there would be no grounds for pursuing that appeal.” And he was pursuing his case “in other ways too”.
91. Mr Binley said that he had accepted the advice of the Department in March 2008 that he had to move out by March 2009. He felt he had taken the issue as far as he could go. He had received some satisfaction. He said “I wanted to continue the appeal to the end and pursue it in discussion with the Speaker. When the Speaker said no I said I needed a little more time to move. He said that that was perfectly fair and I went back to the Director who agreed that that was reasonable.”
92. Mr Binley accepted that he had asked the Department not to put their advice to him in writing in March 2008. He told me, “I thought what the Director had said was fair, but I still wanted to go to the Speaker. I didn’t want his advice to be definitive. It was about the ambience of good relations: atmosphere plays a part.” But Mr Binley did not accept any implication that he might have been content for the discussion to go on: “If you meant that I intended to string this out for my own personal benefit, it is totally untrue. It didn’t come into my mind. What counts is what I know to be true. The very fact that I was still fighting a battle about the Green Book underlines that.” Mr Binley said that he “was going through the process. There were two years of phone conversations, but that is not my fault.” He was “fighting a battle. That is what the people of Northampton sent me here to do.”
93. Mr Binley said that, on the question of whether he should have registered the rental of the Pimlico flat as a financial benefit, he found it ironic that having been accused of stealing the taxpayers’ money he was now accused of just the opposite, of providing them with a benefit. The initial figures he had provided were “done on the back of some crude calculations—showing that my successor in the company-owned flat was charged £2,000 more and that he had to pay council tax and bills on top.” The question of registration was a different matter, Mr Binley said. A benefit in kind was “a matter for the taxman.” It required a “more precise accounting process” than he was capable of. He had an accountant to deal with the Inland Revenue, and if he believed it was a commercial rent, he took his advice. Mr Binley said: “but I have no hang ups about this. I am happy to register if you tell me to.”
94. Mr Binley denied that, in leasing from a company in which he had an interest, he was in effect leasing accommodation from himself, at least in part. He said that a limited company “is a stand alone body. That argument would be much stronger if I was the major
Mr Brian Binley 35
shareholder or sole owner. I cleared that side of the rules with the House authorities. I consulted the Fees Office as the Green Book advised. All the way through, since [the Assistant Director’s] letter it has been accepted that it was not against this rule to rent from a company in this way at the time.” Mr Binley continued: “ It would have been unwise of me not to take note of their [the Department’s] advice. I abide by the rules. I will not take the advice of the court of public perception. And if something is not right, don’t change the rules in a way that impacts unfairly on people … What should I have said, having been told to take the advice of the Fees Office, that I wouldn’t listen to them? That would lead to anarchy.”
95. Mr Binley did not accept that he considered that since he did not agree with the rule he did not need to follow it until he had completed his campaign against it. He said: “I was appealing against an unfair process. I felt it was dishonest. In the normal world of business it would have been a matter of dispute ending in an employment tribunal.” Mr Binley did not accept that the Department had given him a reasonable period of time in 2006 in which to bring his arrangements within the rules – nine months. He said: “ they had changed the terms of my contract without paying heed to me … I felt so strongly that I had tried to get the rules changed over a period of two years.”
96. Mr Binley accepted that he would look at the issue differently now. “But why didn’t I think then as I would now ? There wasn’t the pressure on allowances that there is now. It was a different time and ambience. I felt I had been let down and placed in an invidious position, affecting people I had worked with for twenty years. Since the Conway case91 I would look at it differently, I am sure I would.”
97. Mr Binley said he saw a “clash between the implication in the Green Book that Members are solely responsible for submitting their claims and the idea of the Fees Office as enforcing authority”. Mr Binley continued “I thought I was acting in the interests of the taxpayer, myself and colleagues. I wasn’t misdirecting or misappropriating money. It was right and proper to pursue that argument. One of my predecessors, Bradlaugh, fought seven times for his belief. My case is based on the Fees Office having the final say—they are the enforcer.” Mr Binley noted the statement from Mr Speaker that Members should abide by the decisions of the Department. He said: “I accepted their responsibility to interpret the rules and my right to appeal against them. I appealed against them.”
98. Mr Binley said he had been “livid” at the Department for apparently agreeing to his arrangement in 2005 and then rescinding that decision just weeks after he had taken up residence. He said that he had been “prepared to challenge the decision and fight to the end.” But “looking back” it was a fair assumption that there were quite long periods when not much was going on: “I can’t prove what was going on”.
99. On the issue of the impact of his second home arrangements on the public purse, Mr Binley said “I didn’t pay for the lease of the flat. If there was a benefit it was to the taxpayer. It wasn’t a luxurious flat … The taxpayer would have been paying more money if I had lived
91 Committee on Standards and Privileges, Third Report of Session 2008-09, HC 207
36 Mr Brian Binley
elsewhere. I didn’t misuse the apartment or the taxpayer’s money. In fact any benefit during the period I lived there was to the taxpayer.” Mr Binley asked whether the Director of Operations’ letter [of 31 October 2008] was accepted.92 This said that Mr Binley had “acted properly at all times in this matter.”
100. On 11 November I wrote to Mr Binley, saying that I had consulted the Registrar of Members’ Financial Interests about the further information provided by the Financial Director in his letter of 2 November. She took the view that it was not necessary to show that the company suffered an overall loss on the flat for Mr Binley to have received a benefit. It would, in her view, be possible for the company not to maximise its income from the property by charging less than a full market rate but nonetheless not actually to make a loss. She noted, in this context, that the tenant who took over from Mr Binley paid a monthly rent more than 10 per cent higher than Mr Binley did, which suggested that, in the later stages of his tenancy at least, Mr Binley may well have been paying less than the market would bear.
101. I noted in my letter of 11 November that Mr Binley had explained to me that the rent of £1,500 a month was established as being a fair one by means of telephone calls to local estate agents. I observed, however, that the lease signed in February 2006 specified that Mr Binley would himself pay “all charges for water, gas, television and electricity… together with the usual standing charge meter rents and companies’ hire charges… and all rentals and telecommunications charges… and register with the Local Authority as appropriate and pay the council tax or similar levy”. In the event, as the figures Mr Binley had provided showed, the company had paid lighting and heat, council tax and water during his tenancy, amounting to a total of some £5,500. The annual value of this benefit would have amounted to more than one per cent of the annual parliamentary salary in each year of Mr Binley’s tenancy, and on this basis the Registrar was of the opinion that it should have been entered in the Register of Members’ Financial Interests.
102. Mr Binley replied to me on 25 November.93 He recognised that his arrangement “was a good deal” and acknowledged that the formal rental agreement did not include tax and utilities. “However I find it difficult to understand how I gained a benefit personally, on the basis that the taxpayer was paying the rental and of necessity would have had to pay the other costs had they not been included in the rental payment.”
103. Therefore, it appeared to Mr Binley that the taxpayer had been the beneficiary and indeed “that was recognised by the company who, I believe, didn't want to be seen to be extracting a charge from the public purse which could be construed as being profit-making at the state’s expense.” However, Mr Binley said that he was not qualified to argue the point from a tax perspective or that of an accountant and consequently accepted the Registrar's judgement. He wished to “belatedly register what she [the Registrar] considers to be the value [of the] benefit in kind.”
92 WE 6 93 WE 37
Mr Brian Binley 37
104. I wrote to Mr Binley on 2 December, noting that he had accepted the Registrar’s judgement that the benefit arising from the rental levels which he was charged during his time in the flat should have been registered in the Register of Members’ Financial Interests. I said that I was asking the Registrar to get in touch with him direct to agree with him a suitable entry under category 5 of the rules.94
105. Following discussions with the Registrar, on 17 December Mr Binley made the following entry in the Register of Members’ Financial Interests, under Category 5: “In 2006, 2007 and 2008 I received a registrable benefit in respect of the rent I paid for a flat rented from BCC Marketing”.
Findings of Fact a. The rental arrangement
106. Mr Binley was elected as the Member of Parliament for Northampton South in the May 2005 general election. His main home was in his constituency. He needed an additional home in London to fulfil his parliamentary duties. Having initially stayed in a London club, in February 2006, Mr Binley began renting a flat which had been purchased for his use by BCC Marketing Services Ltd. Mr Binley and his wife each had a 20 per cent shareholding in that company. Mr Binley was—and is—its non-executive chairman. BCC purchased the London property in Pimlico in December 2005 for £345,000, taking out an interest-only mortgage for £297,000.
107. Mr Binley continued to rent the flat from BCC Marketing Services Ltd and to charge the rental cost of £1,500 a month against his Additional Costs Allowance from February 2006 to 25 April 2009. In total, Mr Binley’s claims against his ACA in respect of the rent of this property amounted to £58,500. Within this sum, his claims amounted to £51,000 for the period from July 2006 to 25 April 2009, and £37,500 for the period from April 2007 to 25 April 2009.
108. Before signing the rental agreement on the flat in February 2006, Mr Binley had sought the advice of the then Department of Finance and Administration initially in a telephone call and, later that day, 22 November 2005, in a letter. Mr Binley’s evidence is that he was subsequently told verbally that the arrangement was acceptable within the rules of the Green Book.
109. On 23 March 2006, the Assistant Director of Operations in the Department of Finance and Administration wrote to Mr Binley, telling him that, as a result of a decision by the Members Estimate Committee on proposed changes to the rules on ACA, he was not able to approve Mr Binley’s proposed arrangements. Mr Binley replied on 25 May 2006, although there is no record of that letter. On 5 June 2006 the Assistant Director of Operations wrote to Mr Binley acknowledging that at the time he made his Pimlico flat
94 WE 38
38 Mr Brian Binley
arrangement it was not against the rules to rent from a company in which he had an interest. Therefore, the Assistant Director said he was prepared to allow Mr Binley to continue claiming ACA on this property until the end of the 2006–07 financial year. The Assistant Director went on to say that the planned revisions to the Green Book, due to be published in July, would make this practice against the rules. Mr Binley would therefore need to make alternative arrangements by the end of the 2006–07 financial year.
110. Mr Binley met the Director of Operations at the Department of Resources to discuss this issue on 20 February 2008 and again on 26 March 2008. During the course of those meetings, Mr Binley acknowledged that the arrangements for renting his Pimlico flat were outside the rules, but argued that because the rules changed after he had made the arrangements he should be allowed to continue to make claims for this flat until the end of the current Parliament. The Director of Operations told Mr Binley that this was not possible and that he had agreed with the Clerk and Chief Executive of the House of Commons that his arrangement must end by 31 March 2009. After that date the House would no longer meet Mr Binley’s ACA claims for the property. Mr Binley accepted this advice, although he asked that it not be put in writing.
111. On 18 June 2008, the Standards and Privileges Committee’s Report HC 744 was published.95 It made clear the need for two Members—and by extension others in a similar position such as Mr Binley—to make alternative arrangements in circumstances such as the ones described in this case, where rules had changed after agreement had been entered into. In October 2008, the Director of Operations again met Mr Binley and on 31 October 2008 the Director sent Mr Binley a letter. This made clear that the House could not agree to Mr Binley’s current housing arrangements continuing for the remainder of the Parliament. The Director recalled that earlier in 2008 he had proposed that by the end of that financial year (2008-09) the reimbursement of rent for Mr Binley’s Pimlico flat must come to an end. Alternatively, if Mr Binley chose not to move home, the House would not meet rental payments for this property from April 2009 onwards.
112. Mr Binley wrote to the Speaker on 26 November 2008 to appeal against the Director’s decision. The Speaker’s Secretary replied on 18 December 2008. On 19 January 2009 Mr Binley asked for a meeting with Mr Speaker. The meeting took place in March 2009. Following that meeting the Director of Operations wrote to Mr Binley on 13 March 2009 stating that the House would continue to meet the costs associated with his current flat until 30 April 2009. Mr Binley moved out of this accommodation on 25 April 2009. Mr Binley made no ACA claims in respect of this Pimlico property after that date.
113. The Department of Resources’ view is that Mr Binley’s arrangements were within the rules when he entered into them in February 2006. They were no longer within the rules from July 2006. Accordingly, the Department had asked Mr Binley to change his arrangements by the end of the financial year 2006–07, but this timetable was allowed to slip. Nevertheless, from March 2006 to October 2008, the Department had been entirely
95 Committee on Standards and Privileges, Twelfth Report of Session 2007-08, HC 744
Mr Brian Binley 39
consistent in its interpretation of the Green Book rules and open in its dealings with Mr Binley. It had made clear that Mr Binley’s claims for rent could not continue indefinitely. In March 2006 and again in June 2006, it had set a deadline of the end of March 2007 for ending the arrangement. It had subsequently set deadlines of March 2009 and then April 2009 in October 2008 and March 2009 respectively.
114. Mr Binley’s evidence is that he was given a verbal agreement following his letter to the Department in October 2005 that he could lease his accommodation in London from BCC Marketing Services Ltd. He had acted on that agreement and leased the flat from February 2006. It was not acceptable for him subsequently to be expected to change his contractually agreed arrangement following the change to the rules in July 2006. He had therefore embarked on a campaign to ensure that rules affecting Members’ long-term arrangements should last for the lifetime of the Parliament. His personal leasing arrangements were integral to that campaign, part of which he conducted by means of appealing against the decision of the Department of Resources that he should bring his leasing arrangement to an end within a period shorter than the lifetime of the Parliament. He conducted that appeal through continuing, but unrecorded, discussions with officials in the Department of Resources from March 2006 to February 2008 and subsequently in meetings with a senior Departmental official in 2008. When he had exhausted that avenue, in October 2008, he appealed to the Speaker. Throughout that time, and until April 2009, the Department had continued to meet his rental claims for the property. He therefore believed he had the Department’s agreement to his claims. He accepted the Speaker’s ruling in March 2009 and vacated the flat. His campaign was partially successful in that the provision he had sought was put in the new Green Book rules first introduced in April 2009, although the Green Book rules continued to be changed after that date. Mr Binley notes that he received no personal financial benefit from the arrangement and that the cost to Parliament increased once he rented a flat from a new landlord. He considers that it was right for him to have had the opportunity to pursue his appeal from March 2006 to March 2009, that he was not responsible for the length of time it took, and that he acted honourably at all times. b. Registration
115. BCC Marketing Services Ltd charged Mr Binley a rental of £1,500 a month. While the lease specified that Mr Binley would meet other charges, these charges were in fact met by the company. The company did not continue to meet these charges for the tenant who succeeded Mr Binley.
116. Mr Binley has accepted the Registrar’s advice that, because these additional charges were met by the company, and not by him, Mr Binley received a benefit in each of the calendar years of his rental arrangement: 2006, 2007 and 2008 (but not 2009). He should have registered that benefit in the Register of Members’ Financial Interests under category 5 (“Gifts, benefits and hospitality (UK)”. Accordingly, Mr Binley made an appropriate registration on 17 December 2009.
40 Mr Brian Binley
Conclusions
117. The principal question which I have to resolve is whether, in the particular circumstances of this case, Mr Binley was within the rules of the House in continuing to claim against parliamentary allowances for a flat in London rented from a company in which he had a significant financial interest for two and three quarter years after that practice was specifically prohibited by a change in the rules.
118. There is a secondary question about whether the arrangement provided Mr Binley with a financial benefit which he should have registered in the Register of Members’ Financial Interests. a. The rental arrangement
119. Mr Binley was elected to the House at the 2005 General Election. He quite properly needed to sort out his accommodation arrangements in London. The company which he founded, of which he was chairman and in which he (and his wife), had a significant financial interest, was prepared to purchase a flat for him and charge him rent. Mr Binley intended to claim for this charge from parliamentary allowances. He very wisely decided to consult the then Department of Finance and Administration about this proposed arrangement. He did so in November 2005.
120. The Department were right initially to advise him to write a letter about this matter (and not attempt to deal with it on the telephone). Mr Binley quite properly wrote such a letter. On his evidence, he then followed it up with a telephone call a few days after having sent the letter. There is no record of that call. But Mr Binley recalls that the official to whom he spoke told him that it was within the rules for him to move into the company’s flat and to claim for rent from his Additional Costs Allowance.
121. Mr Binley was in my judgement imprudent to rely solely on this telephone conversation when he entered into his leasing arrangement for the flat three months later in February 2006. He had been advised to write to the Department. He had done so. He would have been well advised to have pressed for a written reply or, at the very least, to have followed up his telephone conversation with a confirmatory letter, as he himself accepted at our interview. Instead, he was to sign a lease on the basis of a telephone conversation for which there is no record.
122. I have considered whether Mr Binley was in breach of the rules when he signed his agreement to take on the flat in February 2006. I agree with the Department that it is arguable that the then existing rule that a Member may not lease a property from themselves should have applied to this property. Mr Binley and his wife had a significant interest. The firm was founded by Mr Binley. Mr Binley was its chairman. But I accept that, despite this uncertainty, Mr Binley’s arrangement was within the rules when he signed this lease. I accept also Mr Binley’s evidence that he received verbal agreement to this arrangement from the DFA, although he would have been best advised to have had it in writing.
Mr Brian Binley 41
123. Mr Binley was understandably very annoyed to receive a letter from the Department in March 2006, only a few weeks after he had signed the lease, responding to his November letter and telling him that, because of the forthcoming change in the Green Book rules, the arrangement was not acceptable. But, given the importance to him of this matter, it is not clear why it took him two months before, on his evidence, he wrote to the Department about the ruling. It is unfortunate that a copy of that letter does not exist.
124. The Department’s statement of 5 June 2006 was unequivocal. The arrangement was not within the new Green Book rules. Mr Binley had to leave the flat by the end of March the following year. That was shortly after the end of the first year of the lease Mr Binley had signed. In my judgement that was a wholly reasonable deadline to set. It allowed Mr Binley and his company plenty of time to make alternative arrangements. And it allowed Mr Binley more than enough time to take any appeal he wanted to make to the Speaker. He was understandably angry. But he was given nine months to work through it.
125. In the event, there is no evidence that Mr Binley took any significant action on this decision by the Department until he raised it again with them some 20 months later. He told me in oral evidence that he should have pursued it more effectively. I accept that judgement. There is no evidence of telephone conversations on this matter between Mr Binley and the Department over this period. Even if such conversations had taken place, on Mr Binley’s evidence I think the greatest probability is that they were about the policy which allowed the rules to change mid-Parliament, not Mr Binley’s own circumstances. On the basis of Mr Binley’s evidence, it does not seem that any such calls were with senior staff in the Department. On the basis of the evidence, I cannot find that there was any sort of recognisable appeal process undertaken by Mr Binley against the Department’s decision in respect of his particular case over the period from June 2006 to February 2008.
126. I consider it unacceptable that Mr Binley should have taken no significant action to respond to the Department’s decision of June 2006 until February 2008. He did not leave his flat by the end of March 2007 as the Department had ruled. Instead, he continued to make claims against his allowances for the rent of his flat, claims which he knew were not in accordance with the rules. The fact that he did not agree that the renting rules should have been changed mid-Parliament and that he wanted to campaign to get this practice stopped, does not in my view provide any justification for ignoring the Department’s decision and continuing with his claims.
127. The Department has some responsibility for this unacceptable state of affairs. It did not, as it had suggested, review the arrangement in the autumn of 2006. It continued to meet Mr Binley’s claims for the rent on the flat after the deadline it set of 31 March 2007 had passed. The Department should have brought this matter to a head in March 2007 and challenged Mr Binley on his continued claims. It did not do so. As a result, I recognise that, with some justification, he may have thought that the Department were not pressing the point.
128. But I consider that the primary responsibility rests with Mr Binley. Having had the initial decision from the Department confirmed in June 2006, he should either have
42 Mr Brian Binley
accepted and implemented the decision (which gave him nine months to move out of the apartment) or have appealed against that decision to the Speaker as he was finally to do in November 2008, nearly two and a half years after the Department had confirmed its decision. The nine months’ leeway from June 2006 to March 2007 gave him plenty of time for such an appeal to be made. By March 2007, the time for any appeal by Mr Binley was exhausted. There were no grounds for resurrecting it nearly a year later.
129. The evidence suggests that the matter was, however, discussed between Mr Binley and the Department in February 2008. In his oral evidence, Mr Binley referred to the impact of the Committee’s report on the case of Mr Derek Conway (the Member for Old Bexley and Sidcup).96 This report was published at the end of January 2008. On Mr Binley’s evidence I think it reasonably likely that that was the reason for Mr Binley’s case being raised again in February 2008: expenses were coming under the spotlight.
130. The time taken to resolve this matter in 2008 was more understandable. It was understandable that, after the Department and Mr Binley had come back to the matter in February 2008, they would wish to await the outcome of my consideration of another complaint and the outcome of the argument made in the course of that inquiry that changes to the Green Book rules should not apply to pre-existing agreements.97 It was understandable that Mr Binley’s decision to appeal to the Speaker took some months to resolve. But in my judgement there was no reason or justification for this matter to have been resurrected in 2008. Mr Binley should have been able to resolve his concerns about this case, including if necessary with the Speaker, between June 2006, when he was told that he would have to leave the flat, and March 2007, the deadline set by the Department.
131. I therefore conclude that Mr Binley was in breach of the rules of the House from March 2007 until he moved from his flat in April 2009 because he did not act on the Department’s clear instructions that by the end of March 2007 he should move out of, or stop claiming for, the flat which was owned by a company in which he had a leading interest. I therefore uphold the complaint.
132. I make the following additional observations on the matter:
1) The Speaker’s introduction to the 2006 Green Book makes clear that the Members Estimate Committee, chaired by the Speaker, had given the Department of Finance and Administration (now the Department of Resources) authority to interpret and enforce the Green Book rules. While I understand Mr Binley’s eventual decision to appeal to the Speaker, I consider that the initial decisions by the Department in 2006 had the authority of the Green Book and of the Members Estimate Committee.
96 Committee on Standards and Privileges, Third Report of Session 2008-09, HC 207 97 Committee on Standards and Privileges, Twelfth Report of Session 2007-8, HC 744
Mr Brian Binley 43
2) It is fair to note, as I have above, that the Department must bear some responsibility for allowing this issue to drag on through 2006 to 2008.
3) It is also fair to note that there is no evidence that the public purse lost out as a result of this arrangement. Mr Binley was fully within the rules in claiming for the rental costs of a property in London, the size of his claims was not excessive and they were within the maximum provided for under the allowance. Mr Binley’s mistake was to continue to rent from a company in which he had an interest, despite the change in the rules intended to prevent this. b. Registration
133. Mr Binley identified early on in his evidence to me that, in his view, the company had made a loss on the arrangement because the rental income did not meet the full costs of the property. At my request, Mr Binley and the company’s Financial Director provided me with various figures and explanations of the company’s expenses on the flat set against the rental income. But it is clear, and Mr Binley has accepted, that there was a benefit to him because the company did not charge him for a range of costs, such as utilities and council tax, which the terms of the lease had ascribed to him in addition to the rent. Whether or not the company made a loss over the period of Mr Binley’s tenancy, that clearly represented a benefit to the Member. It was a benefit which the company did not give to the tenant who succeeded Mr Binley.
134. The benefit arose from Mr Binley’s membership of the House, since the flat was made available to him by the company specifically to help him to fulfil his parliamentary duties. The benefit exceeded the threshold for registration in each of the main calendar years of the arrangement—2006, 2007 and 2008. That benefit should, therefore, have been registered in the Register of Members’ Financial Interests. For this purpose, it is not material that the benefit was, in effect, then transferred to Parliament (since Parliament benefited from Mr Binley’s claims for the property being less than they would otherwise have been).
135. Mr Binley has now made an appropriate registration entry in the Register. I am grateful to Mr Binley and the Financial Director of BCC Marketing Services Ltd for their help on this matter and for the advice of the Registrar of Members’ Financial Interests.
136. I conclude, therefore, that Mr Binley was in breach of the rules of the House by not registering in the Register of Members’ Financial Interests that, from 2006 to 2008, he had received a registrable benefit in respect of the rent he paid for a flat rented from BCC Marketing Services Ltd. This benefit should have been registered under category 5 of the Rules for Registration. This matter did not form part of the complaint. c. Overall conclusions
137. I consider the breach of the rules in respect of the Mr Binley’s rental claims to be a serious matter. This is not because I consider that Mr Binley personally secured any financial advantage from the arrangement. And I accept his evidence that the company
44 Mr Brian Binley
only bought the flat because they wanted to help him in his parliamentary duties. But it is a serious matter when a Member does not bring themselves and their arrangements within the rules of the House having been given sufficient time to do so. On his own evidence, Mr Binley decided to fight to the end the decision which the Department of Resources had properly made. He was wrong not to have concluded any such fight by March 2007. It was, in my view, a serious misjudgement to allow the matter to drag on beyond the March 2007 deadline and then to take up the issue nearly a year later. That was neither necessary nor wise.
138. It is clearly important that Members should ensure that their registration obligations are identified and that they do make sure that they make the necessary entries in the Register of Members’ Financial Interests. But it is, I think, understandable that Mr Binley did not spot that the arrangement he had with his company created a registrable benefit for him. The difficulty of achieving an adequate arrangement when that arrangement is with a company in which a Member has a close interest underlines, in my view, the wisdom of the House in changing the rules in July 2006.
139. It is regrettable that, following this change in the rules in July 2006, Mr Binley did not separate out his personal position from his policy campaign, settle the one and, if he so wished, fight the other.
21 December 2009 John Lyon CB
Mr Brian Binley 45
Written evidence received by the Parliamentary Commissioner for Standards
1. Letter to the Commissioner from Mr Michael Barnbrook, 17 June 2009
I wish to register a formal complaint against Mr Brian Binley, Member of Parliament for Northampton South.
My complaint is based on a newspaper article in the Daily Telegraph dated 17th June,2009, in which it states that Mr Binley claimed £1,500 a month to rent a flat from his own company, BCC Marketing, for more than three years, despite House of Commons rules forbidding MPs from renting properties from themselves or their companies.
Mr Binley was first warned that he was in breach of the rules in April, 2006, but was permitted to continue claiming, after appealing to Michael Martin, the Speaker of the House of Commons.
Mr Martin only ruled in April, 2009 that the claims must stop but Mr Binley has not yet had to repay the £57,000 he improperly received whilst the Speaker deliberated.
It therefore seems appropriate that, having lost the appeal, Mr Binley should repay all monies from April. 2006, when the matter was first brought to his attention.
The relevant rule in the Green Book is: 3.3.3
“ACA must not be used to meet the costs of a mortgage or for leasing accommodation from:
a. Yourself;
b. A close business associate or any organisation or company in which you-or a partner or family member- have an interest; or
c. A partner or family member.”
You will be aware that I am not able to supply evidence to support my complaint, not having access to the Commons Fees Office, but I am not aware that Mr Binley is denying the allegations made against him in the Daily Telegraph.
In any case, you as Parliamentary Commissioner for Standards, have authority under Standing Order 149, to obtain from any Member, any correspondence that will assist you in your investigation.
I also understand that details of all Members' expenses will be in the public domain as from Thursday, 18th June 2009.
I enclose a copy of the article from the Daily Telegraph for your assistance. I look forward to your early response.
17 June 2009
46 Mr Brian Binley
2. Extracts from article in the Daily Telegraph, 17 June 2009
Tory claims £57,000 to rent flat from own company * Millionaire MP broke Commons rules * Payments continued despite warning
A MILLIONAIRE Conservative MP broke parliamentary rules by claiming more than £50,000 in taxpayer- funded expenses to rent a flat from his own company.
Brian Binley claimed £1,500 a month to rent the flat for more than three years, despite House of Commons rules forbidding MPs from renting properties from themselves or their companies.
The Daily Telegraph can disclose that Mr Binley's rental claims were first flagged up by parliamentary officials in April 2006, but the payments were not stopped until April of this year.
In 2006, he was told that the claims were not allowed. But he was permitted to continue claiming after appealing to Michael Martin, the Speaker of the House of Commons. Mr Martin only ruled in April 2009 that the claims must stop but Mr Binley has not had to repay the £7,000 he improperly received while the Speaker deliberated.
…
It is not clear why Mr Binley, the MP for Northampton South, was permitted to continue receiving substantial sums of taxpayers' money for more than three years despite being in breach of the rules.
Mr Binley was elected to the Commons in May 2005. He at first used the "second home'' parliamentary allowance - the additional costs allowance (ACA) - to stay at the Carlton Club in London, a gentleman's club for Conservative supporters.
In February 2006, he began claiming rent at £1,500 a month for a flat in Pimlico, close to the Houses of Parliament. Land Registry records show that the flat is owned by a company called BCC Marketing, which had purchased the property in December the previous year for £345,000.
Mr Binley is the chairman and founder of BCC Marketing and currently owns 20 per cent of the shares in the company. His wife Jacqueline holds a further 20 per cent of the shares while his son James works for the business.
Initially, the arrangement for Mr Binley to pay his own company may have been within MPs' rules. In 2005, the Green Book, which sets out parliamentary rules, stated that MPs were barred from claiming for "the costs of leasing accommodation from yourself''. However, in April 2006, the rules were tightened specifically to bar MPs from paying rent to their own companies. Following the change, the House of Commons Fees Office contacted Mr Binley to inform him that his arrangement was outside the rules.
Mr Binley appealed and, when Mr Martin rejected that appeal two months ago, Mr Binley says that he moved out of BCC Marketing's flat and into nearby premises.
He insisted yesterday that the rent he paid to the company did not fully cover the costs of the mortgage on the flat. However, had he bought the flat directly himself he would only have been able to claim for the interest on the mortgage, which is substantially less than the full cost of repaying the loan.
After the Daily Telegraph began disclosing information about MPs' expenses last month, Mr Binley held a public meeting in his constituency and handed out copies of his expenses, with addresses redacted.
"I have dealt with my expense claims honourably and honestly, and will be handing out a full breakdown of my claims, year by year,'' said Mr Binley at the time. "Anyone who wants to tar us all with the same brush should be ashamed of themselves.''
Mr Binley's actions are likely to put David Cameron under pressure to discipline him. It is understood that the MP's controversial arrangement had not been disclosed to the Conservative Party's scrutiny committee, which
Mr Brian Binley 47
is examining expense claims made by the party's MPs. The committee is now expected to re-examine Mr Binley's expenses.
Yesterday, Mr Binley defended his decision to pay rent to BCC Marketing. "I am an MP from a working-class background who knows that most of his constituents don't earn much above the average wage and therefore treats taxpayers' money with the care it deserves,'' he said.
"I did rent a flat for the reasons that I have stated from a company that I founded. The rent charged included council tax, water rates, electricity, gas, and all the furnishings and white goods in the flat. In addition, I paid the cleaner, rightly and properly, from my own pocket.
"When the mortgage was taken out, it was totally cleared by the Fees Office and when the rules were changed which stated that I could not rent from a company that I had an interest in, I appealed that decision. I sadly lost that appeal, accepted the decision and found another flat which unfortunately costs the taxpayer more money because that is the going rate.''
…
17 June 2009
3. Letter to Mr Brian Binley MP from the Commissioner, 22 June 2009
I would welcome your help on a complaint I have received from Mr Michael Barnbrook about the claims you made against the Additional Costs Allowance for your London residence.
I attach a copy of the complainant’s letter of 17 June and the article in the Daily Telegraph, of the same date, to which he refers. In essence, the complaint is that you made claims against the Additional Costs Allowance for property which you rented from a company in which you and your wife had an interest, contrary to the rules of the House.
The Code of Conduct for Members of Parliament sets out in paragraph 14 the following:
“Members shall at all times ensure that their use of expenses, allowances, facilities and services provided from the public purse is strictly in accordance with the rules laid down on these matters, and that they observe any limits placed by the House on the use of such expenses, allowances, facilities and services.”
The complaint relates to your claims from February 2006 to April 2009. The relevant rules in the Green Book were, for a short time, those published in April 2005 and, from July 2006, those published that month.
Mr Speaker, in his introduction to both editions, wrote as follows:
“Members themselves are responsible for ensuring that their use of allowances is above reproach. They should seek advice in cases of doubt and read the Green Book with care. In cases of doubt or difficulty about any aspect of the allowances or how they can be used, please contact the Department of Finance and Administration. The Members Estimate Committee, which I chair, has recently restated the Department's authority to interpret and enforce these rules.”
The rules for the Additional Costs Allowance are set out in Section 3 of both editions. The rules for 2005 set out the scope of the Allowance as follows:
“The additional costs allowance (ACA) reimburses Members of Parliament for expenses wholly, exclusively and necessarily incurred when staying overnight away from their main UK residence (referred to below as their main home) for the purpose of performing Parliamentary duties. This excludes expenses that have been incurred for purely personal or political purposes.”
Eligibility is set out in paragraph 3.2.1 as follows:
“You can claim ACA if:
48 Mr Brian Binley
a You have stayed overnight in the UK away from your only or main home, and
b This was for the purpose of performing your Parliamentary duties, and
c You have necessarily incurred additional costs in so doing, and
d You represent a constituency in outer London or outside London.”
Paragraph 3.11.1 gives examples of allowable expenditure including:
“• Rent - on one additional home in either London or the constituency. (If you claim for a rental deposit you must repay this when the deposit is returned to you.)
• Mortgage costs - for one additional home in either London or the constituency. This is limited to the interest paid on repayment or endowment mortgages, legal and other costs associated with obtaining (and selling) that home (eg stamp duty, valuation fees, conveyance, land searches, removal expenses)
…
• Utilities
❖ heat
❖ light
❖ water
❖ council tax
...
• Maintenance & service agreements
❖ necessary repairs to make good dilapidations
❖ decoration
• Cleaning
• Insurance
❖ buildings and contents”.
Paragraph 3.12.1 sets out expenses which are not allowable, including:
“The costs of leasing accommodation from yourself”.
The July 2006 rules introduced a number of principles in paragraph 3.3 of Section 3, as follows:
“3.3.1. Principles
You must ensure that arrangements for your ACA claims are above reproach and that there can be no grounds for a suggestion of misuse of public money. Members should bear in mind the need to obtain value for money from accommodation, goods or services funded from the allowances.
3.3.2.
Mr Brian Binley 49
You must avoid any arrangement which may give rise to an accusation that you are, or someone close to you is, obtaining an immediate benefit or subsidy from public funds or that public money is being diverted for the benefit of a political organisation.
3.3.3.
ACA must not be used to meet the costs of a mortgage or for leasing accommodation from:
❖ yourself;
❖ a close business associate or any organisation or company in which you - or a partner or family member - have an interest; or
❖ a partner or family member.”
I would welcome your comments on this complaint in the light of this summary of the relevant rules. In particular, it would be helpful to know:
1. why you identified your London residence as being the one against which you made your ACA claims, together with dates and details of the financial arrangements in respect of the property;
2. why you decided to make the arrangement you reportedly did with BCC Marketing, and details of the ownership of that company;
3. details of your claims against the ACA for this property in each financial year, or part-year, from February 2006 to March 2009;
4. why you considered that your initial arrangements in February 2006 were within the Green Book rules published in April 2005, and whether you consulted the House authorities about this;
5. why you considered that your arrangements were within the revised Green Book published in July 2006; what consultations you had with the House authorities about this; when you first became aware, if that was the position, that the House authorities considered that the arrangement was not within the revised rules, the sequence of events which reportedly led to you to appealing to Mr Speaker about this advice, and how and when it was finally resolved, including any reasons you may have for the length of time it appears to have taken.
Any other points you may wish to make to help me with this inquiry would, of course, be very welcome.
I attach a note which sets out the procedure I follow. I have written to the complainant to let him know that I have accepted his complaint and am writing to you about it. I would be grateful if it were possible to let me have a response within the next three weeks. If there is any difficulty about this, or you would like to have a word about any aspect of this complaint, please contact me at the House.
I would be grateful for your help on this matter.
22 June 2009
4. Letter to the Commissioner from Mr Brian Binley MP, 30 June 2009
Thank you for your letter of 22nd June 2009. Let me now attempt to answer your questions.
Question 1
I identified my London residence for ACA claims because my family home is in the Northampton South Constituency and has been for 25 years and my London residence was rented simply to pursue my role as a Member of Parliament.
50 Mr Brian Binley
I leased the flat at … from BCC Marketing Services Ltd which bought the flat for that purpose in order to help me in December 2005. The purchase was made following discussions with the Department of Resources in the autumn of 2005 wherein it was verbally confirmed that the arrangements met the requirements of the Green Book at that time. I thereafter moved into the property at the beginning of February 2006 claiming a rent of £1500 per calendar month. Incidentally the rental price included council tax, water rates, electricity and gas costs and the company bought all of the furniture, white goods and other furnishings used in the flat. The company had taken out an interest only mortgage for £345, 000 (the cost of the purchase) at the time of the purchase and the interest payment then amounted to £1600 per month. I attach in appendix,98a copy of the company's expenditure on the flat during the period I leased the property together with the rental income received and you will note that the whole transaction showed a deficit of expenditure over income of £9,774 confirming that the company made not one penny of profit from the tax payer but instead registered a loss. Consequently the taxpayer got a good deal which was equally beneficial to my family and myself.
Question 2
I decided to accept the arrangement which was offered to me by my fellow directors because my wife is eighteen years younger than I and I was sixty three at the time I entered Parliament. As a consequence I didn't not want to cause my wife stress in this regard should anything untoward happen to me during the period of the lease. As already stated I took the precaution of clearing the arrangement with the Department of Resources during the autumn of 2005 and received confirmation that the arrangements were perfectly acceptable within the rules and the meaning of the Green Book. I should also tell you that my wife and I together own 40 per cent of the shareholding of BCC Marketing Services Ltd, a company I founded in 1989, and which has employed hundreds of people in the time it has been in existence making a sizeable contribution to Inland Revenue. The other shareholders are … who collectively own 40 per cent and … who also owns 20 per cent. In other words my wife and I together were not majority shareholders in the company.
Question 3
You will know that the rules in the Green Book impacting upon this particular matter were changed at the end of February 2006 although notice of that change wasn't brought to my attention until 23rd March, even though I had been given verbal assent to the arrangements in autumn 2005 and I proceeded to sign a lease, pursuant upon that decision. Recognising that my arrangements were now in contravention of the rules but equally recognising that I had already committed myself to a long term lease, I felt I was in an impossible situation and consequently sought permission to appeal against the rule change. I felt very strongly that rule changes of this nature impacting upon contractual arrangements should not take precedence over those arrangements not least because the lease agreement could be upheld in law; I felt that to be an unacceptable practice not only for myself but also for other Members of Parliament.
I therefore appealed to the Department of Resources as was my right and they agreed to continue to pay the claimed rental during the period of lengthy correspondence which thereafter ensued between myself and the Department of Resources. That correspondence culminated in a letter date 31st October 2008 which stated and I quote:
"That in our discussions you made the following points..
(i) That the current arrangement was within the ACA rules at the time it was entered into;
(ii) The 2006 rules are themselves open to interpretation (in fact, you argue that the rules are less than legally watertight)
98 WE 7
Mr Brian Binley 51
(iii) That changing the rules during the life of Parliament and expecting Members to abandon any standing arrangements was unreasonable; and
(iv) That market conditions meant that any new rental or other arrangements was unlikely to result in a saving to the taxpayer.
I fully accept that you have acted properly at all times in respect of this matter. However, notwithstanding the background to the current position, as we have discussed, the House cannot agree to your current housing arrangements continuing for the remainder of this Parliament.
The rules in the Green Book are clear on this point. We also discussed the fact that making alternative housing arrangements in London against your busy schedule is not a simple matter. So, earlier this year I proposed that by the end if the current financial year the reimbursement of rent for [the London property] must come to an end. Alternatively, if you choose not to move home, the House would not meet rental payments for this property from April 2009 onwards”.
I thereafter made a final appeal to the Speaker based on a general principle in the newly published Green Book which was agreed at the end of January 2009 which stated:
"As a general principle major changes impacting on any issue which might require Members to enter into any long- term arrangements or materially affecting the guidance or rulings contained in this document, should be designed to last for the lifetime of a Parliament and not change mid term"
The Speaker thereafter informed me verbally, in the middle of March that he had rejected my appeal but he kindly offered to allow me to claim rental for a further period to 30th April 2009 in order for me to find another flat and vacate the flat which I have lived in since February 2006 which I duly did. I think it is also worth pointing out that had I not claimed for rent on my existing flat I would have claimed a similar amount or more for accommodation elsewhere during that period. I might say however that sadly, the new arrangement is more expensive for the taxpayer than the previous arrangements had been requiring that I pay weekly rentals of £365 exclusive of council tax, water rates, electricity, and gas. However although the new arrangement would be more costly to the tax payer they did fall within Addition Cost Allowance limits at the time the lease agreement was signed.
Question 4
I have already explained why I considered my initial arrangements made in the autumn 2005 fell within the Green Book rules published in April 2005 in answer 1 detailed above.
Question 5
You will note from the above that that I did not consider my arrangements were within the revised Green Book published in 2006, but that through no fault of my own I found myself between and rock and a hard place having signed a long term lease the reasons of which are equally outlined above and that is one of the reasons why I appealed. The answers to the other facets of question five are given above.
Let me herein confirm that my family and I did not receive a penny of benefit from the arrangement which they would not have received had I rented a property from another source. However my company did subsidise my living arrangements which is proved by the attached account detailing the total expenditure incurred during the whole period of the rental, which when set against total income showed a deficit of some £9,774. I therefore feel that my actions were honourable and the interests of the taxpayer were fully protected.
You will note from the ranking of MPs expenditure that I treat taxpayer's money very carefully by the fact that I was ranked 414th in the ranking of MPs total claims in 06-07 and 378th in the rankings for 07-08. With regard to ACA alone I was ranked 334th and 302nd respectively. Furthermore I have always paid for the cleaning of my flat out of my own pocket. In other words I take my responsibilities to the taxpayer very seriously. Above all consider the concept of personal honour to exceed all other values.
I might also tell you that my campaign to ensure that rule changes were not imposed midway through a Parliament was vindicated in the New Green Book published in March 2009 which now states:
52 Mr Brian Binley
"As a general principle major changes impacting on any issue which might require Members to enter into any long- term arrangements or materially affecting the guidance or rulings contained In this document, should be designed to last for the lifetime of a Parliament and not changed mid term"
It should also be recognised that four major changes to the Green Book rules have been undertaken since the publication of the April 2005 Green Book relevant to the period when I entered parliament in May 2005 and that fact alone highlights the unacceptable nature of the process employed during my four years in this House.
The lodging of an appeal in almost all legal contexts invariably requires the preservation of the status quo. If it were otherwise, the appeal would be rendered pointless. In my case, had the Department of Resources not agreed to continue to honour the payment of rent for the original accommodation pending the determination of the appeal to the Speaker, that accommodation would have either have had to have been sold or leased to another tenant so as to provide for the payment of the company's mortgage, and thus, the objective of the appeal would have been defeated. I would have been obliged to move to another property, whether rented or otherwise, for the cost of which I would have been entitled to submit application for payment on the ACA.
Therefore, it was well understood and agreed that during the period the House of Commons Authority was considering the submissions I had made, for the length of which I was not responsible, I should continue to be reimbursed for the rent on the existing property.
This agreement was expressed in two letters dated 5th June 200699 and 31st October 2008 which I attach hereto.100
It follows that it would have been necessary for the monies paid to me between March 2006 to March 2009 to have been paid in any event, and that each claim was met by the Department of Resources with its full knowledge and agreement of the circumstances of my appeal.
Therefore there can be no legitimate case for a finding that I should have to repay any or all of these sums, and thus to bear the full cost of accommodation that was wholly and exclusively necessary for me to fulfil my Parliamentary duties
I hope the above is helpful to you at this stage in your deliberations however I am more than willing to provide further information if and when required. Please therefore come back to me if you wish me to do so.
30 June 2009
5. Letter to Mr Brian Binley MP, from the Assistant Director of Operations, Department of Finance and Administration, 5 June 2006
Thank you for your letter dated 25 May 2006. I am very sorry for the delay in replying.
As we have discussed, at the time you made your current arrangement, the rules relating to the Additional Costs Allowance as published in the Green Book did not state that it was against the rules to rent from a company in which you had an interest. Therefore, I am prepared to allow you to continue claiming ACA on this property until the end of the 06/07 financial year.
However, the planned revisions to the Green Book, due to be published in July, will make this practice against the rules. You will therefore need to make alternative arrangements by the end of the 06/07 financial year..
99 WE 5 100 WE 6
Mr Brian Binley 53
I suggest in advance of this that we review your situation in the autumn.
I hope this is helpful.
5 June 2006
6. Letter to Mr Brian Binley MP from the Director of Operations, Department of Resources, 31 October 2008
We have had a number of discussions about the reimbursement of your housing costs through the Additional Costs Allowance (ACA). I promised to write to confirm the agreement we reached and to set out, for the record, the reasons for this.
You currently rent your London property from a company in which you and your wife are significant shareholders. As you are aware, this raises questions about whether this is within the rules of the House.
First, it might be helpful if I set out how the ACA rules themselves have evolved. The advice in editions of the Green Book until 2002 tended towards basic rules. Novel or complicated housing and ownership arrangements were not covered. Members were advised to seek guidance where necessary.
The June 2003 Green Book which was in effect at the time of the 2005 General Election had the following reference:
“3.12.1 The following expenditure is not allowable:
“The costs of leasing accommodation from yourself.”
It is an arguable point whether when you were elected, this form of words might have led you to consider the arrangement. Of course, the strict technical position was that you were not “leasing accommodation from yourself”.
There was a significant change to the Green Book in July 2006 when the following text appeared:
“3.3.1 Principles
“You must ensure that arrangements for your ACA claims are above reproach and that there can be no grounds for a suggestion of misuse of public money. Members should bear in mind the need to obtain value for money from accommodation, goods or services funded from the allowances.
“3.3.2
“You must avoid any arrangement which may give rise to an accusation that you are, or someone close to you is, obtaining an immediate benefit or subsidy from public funds or that public money is being diverted for the benefit of a political organisation.
3.3.3 ACA must not be used to meet the costs of a mortgage or for leasing accommodation from: yourself...”
The purpose of this new formulation in the Green Book is, in my view, clear. Moreover, the Department is empowered to interpret the rules in the Green Book by the Speaker. Your rental arrangement, in my opinion, contravenes both paragraphs 3.3.2 and 3.3.3. This means that the House cannot continue into the future to meet your rental payments for [the London property] as it does now.
In our discussions you made the following points:
(i) that the current arrangement was within the ACA rules at the time it was entered into;
(ii) that the 2006 rules are themselves open to interpretation (in fact, you argued that the rules are less than legally watertight);
54 Mr Brian Binley
(iii) that changing the rules during the life of Parliament and expecting Members to abandon any standing arrangements was unreasonable; and
(iv) that market conditions meant that any new rental or other arrangement was unlikely to result in a saving to the taxpayer.
I fully accept that you have acted properly at all times in respect of this matter. However, notwithstanding the background to the current position, as we have discussed, the House cannot agree to your current housing arrangements continuing for the remainder of this Parliament. The rules in the Green Book are clear on this point. We also discussed the fact that making alternative housing arrangements in London against your busy schedule is not a simple matter. So, earlier this year I proposed that by the end of the current financial year the reimbursement of rent for [the London property] a must come to an end. Alternatively, if you choose not to move home, the House would not meet rental payments for this property from April 2009 onwards.
I would be grateful if you would let me in due course know how you intend to proceed. I look forward to hearing from you.
31 October 2008
Mr Brian Binley 55
7. Table of Expenditure on London property by BCC Marketing Services Ltd
Income/Expenditure Account
BCC Marketing Services Ltd
Purchase and Lease of a flat in […] 2006–08
Purchase price £345,000
Expenditure by BCC Amount Income from Brian Binley
Stamp Duty £10,350
Valuation £639
Survey £600
Interest £44,917 £58,500
Parking £110
Lighting and Heat £2,947
Insurance £221
Council Tax £2,449
Water £146
Total £68,274 £58,500 £9,774 deficit
*Note Brian Binley also happily paid £4,500 from his own pocket for furnishings in the flat.
** When Brian Binley first calculated interest, he calculated it as its original figure of £1,600 per month.
BCC Marketing Services Ltd
8. Letter to Mr Brian Binley MP from the Commissioner, 2 July 2009
Thank you for your letter of 30 June about this complaint in respect of your ACA claims for your London residence.
I was most grateful for this prompt response, and for your offer to provide any further information which I thought might be helpful. You have forwarded two letters which you received from the Department of Resources about this issue. It would be helpful if you could also supply copies of any other relevant correspondence which you hold, including your own letters to Departmental officials. And could you also supply a copy of the lease or any other documentation which identifies arrangements for early release or termination?
In view of the subsidy which you say BCC Marketing gave you, I will also need to consider whether this raised an obligation on you to register that benefit in the Register of Members’ Interests. The Guide to the Rules for 2005 to 2009 (HC 351) provides for the registration of gifts, benefits and hospitality under category 5. It advises in paragraphs 28 and 29 as follows:
56 Mr Brian Binley
“28. The specified financial value above which tangible gifts (such as money, jewelry, glassware etc.), or other benefits (such as hospitality, tickets to sporting and cultural events, relief from indebtedness, loan concessions, provision of services etc.) must be registered is 1 per cent of a Member’s annual parliamentary salary.
“29. The rule means that any gift, or other benefit, which in any way relates to membership of the House and which is given gratis, or at a cost below that generally available to members of the public, should be registered whenever the value of the gift or benefit is greater than the amount specified above. Any similar gift or benefit which is received by any company or organisation in which the Member, or the Member and the Member’s spouse or partner jointly, have a controlling interest should also be registered.”
I would welcome your comments on the registration aspects of this matter.
When I receive your response, I will be consulting the Department of Resources and the Registrar of Members’ Interests.
Thank you again for your help.
2 July 2009
9. Letter to the Commissioner from Mr Brian Binley MP, 10 July 2009
Thank you for your letter of 6 [in fact 2] July. I am most appreciative.
I enclose all of the further copies of correspondence we have in our files.101 I'm not sure all of the letters transacted between myself and the Department of Resources were included in the files but unfortunately there is little I can do about that.
Secondly much of the transactions were done either verbally, at meetings or on the telephone, and clearly whilst those conversations they were not recorded as you will understand they were very important.
Thirdly you will note that in my original letter dated 23rd November 2005 that the company wished to use the property for their own use also, but it was later discussed in one of the conversations that the flat could not be used in that way and consequently it never has.
I might say the rent was not a benefit in kind on the basis I was charged a commercial rate. The truth of the matter is had I continued to rent the property over a longer period the shortfall experienced by the company would have been eradicated; certainly there was no intention of subsidising me. I just make the point that contrary to the company making money out of the situation the obverse was the case.
Hope the above is help to you.
10 July 2009
10. Letter to Department of Finance and Administration from Mr Brian Binley MP, 22 November 2005
I talked to your colleague yesterday about my plans to lease a flat in Pimlico for the remainder of my term in the House. Your colleague suggested that whilst he felt the details of that lease would not create a problem, he nonetheless asked I write to you so that you could cast your eye over the arrangement and ensure that the matter was properly cleared through formal channels.
The flat will be owned by BCC Marketing Services, a company I founded in 1989 which now employs around 110 people. My personal holding in the company is 20 per cent of the total share issue and I remain, as
101 WE 10, WE 11, WE 12, WE 13, WE 14, WE 15, WE 16
Mr Brian Binley 57
Chairman of the company, on a director's salary of £8000 a year. In addition, my wife acts as company secretary and also owns 20 per cent of the shareholding.
The remaining shares are held as follows: [Financial Director], 20 per cent; [wife of Financial Director], 20 per cent; and [Managing Director], 20 per cent.
The company is buying the two-bedroom flat because it has a need for both the managing director and the financial director to stay in London on regular occasions, and because it provides me with an opportunity to lease accommodation at a sensible rate as opposed to continuing to stay at the Carlton Club. The cost will be some £1,250 per month, which provides both a flexible and cost-effective alternative to my present arrangements.
And that's about it. Perhaps you would be kind enough to review the above and confirm that the proposal falls within the parameters laid down for Members.
Thank you for your help.
22 November 2005
11. Letter to Mr Brian Binley MP from Assistant Director of Operations, Department of Finance and Administration, 23 March 2006
You asked whether you could rent a flat space from a company in which you have a 20 per cent holding.
I am sorry not to have given you an answer more quickly, but I have been awaiting the outcome of the Members Estimate Committee meeting of 27 February which considered proposed changes to the rules for ACA. One of the changes agreed by the MEC was as follows:
ACA must not be used to meet the costs of a mortgage or for leasing accommodation from:
• yourself;
• a close business associate or any organisation or company in which you—or a partner or family member—have an interest; or
• a partner or family member.
A new edition of the Green Book incorporating these changes will be available in the late spring, but in the meantime, as a result of this decision, I am afraid I am not able to approve your proposal.
I hope this will not cause you too much difficulty. If you need further advice on using your ACA, please approach the Enquiries and Advice team on ext 1340.
23 March 2006
12. Letter to Mr Brian Binley MP from the Financial Director of BCC Marketing Services Ltd, 29 August 2008
I refer to our recent conversation and would now clarify the situation regarding your occupancy of the above property.
The leasehold ground floor flat was purchased by BCC Marketing Services Limited in December 2005 for a total cost of £358,484, including Legal Fees and Stamp Duty. The decision to make the purchase was taken at a full Board meeting at which you were present. The reasons were twofold -- to derive an income from ownership and to possibly enjoy a long term appreciation in value.
I would remind you that you and your wife jointly own just 40% of the Share Capital of BCC Marketing Services Limited, the 'remaining 60% being owned by [name] and myself (and my wife). Thus the decision to
58 Mr Brian Binley
purchase and the choice of occupant were, and remain, the decision of the full Board, all Board members being shareholders.
You are currently charged an annual rental of £18,000, paid monthly. It is the view of the Board of directors that this is a fair rent in the current economic situation. You certainly obtain no pecuniary advantage regarding this rental through your membership of our Board or the ownership of a minority shareholding. Furthermore,
We are happy for you to continue your occupancy under the present terms.
29 August 2008
13. Letter to the Speaker from Mr Brian Binley MP, 26 November 2008
In December of 2005, some eight months after being elected to this House and following advice given to me over the telephone by the Fees Office, the Company of which I am a Director, bought a flat in Pimlico for £358,000, which I arranged to rent.
The share capital of the Company was owned by myself (20 per cent) my wife (20 per cent) the Financial Director (20 per cent) his wife (20 per cent) and the Managing Director (20 per cent). The company bought all of the furniture, crockery, cutlery and other household items which turned the flat into a London home. In addition, they also pay the rates, electricity, gas and cleaning bills. In other words, not one iota of Parliamentary money has been spent on those items.
In return, I am charged an annual rental of £18,000, paid monthly, which equates to approximately £346 per week, a rental figure which I am sure you will agree is an excellent deal for the taxpayer and sizeably less than if I were to rent from another source, or indeed stay in a hotel.
A Members Estimate Committee meeting on 27th February 2006 changed the rules governing rental of property in this manner. The change was as follows:
"ACA must not be used to meet the costs of a mortgage or for leasing accommodation from:
• Yourself;
• A close business associate or any organisation or company in which you — or a partner or family member — have an interest; or
• A partner or family member."
On the 5th April of that year I received a letter advising me of that change. I thereafter met with [the Director of Operations at the Department of Resources] and explained my objections both to the fact that rule changes of this kind, affecting long term contractual issues should not in all fairness be made mid term and particularly after new entrants have made decisions of a long term contractual nature as described above.
Secondly I argued that I obtained no pecuniary advantage from this rental through my membership of the Board.
Thirdly I argued that the amount of money received by way of rental covered only a minority of the interest- only mortgage taken out by the company to make the original purchase.
Those discussions with [the Director] continued for some time and culminated in a letter received on 6th November 2008, a copy of which I enclose. I might add that I believe the new rules governing this point are unhelpful, not least in a situation where if a family member or close associate worked for a bank or a mortgage company, presumably making it impossible for a Member of the House [to borrow] money from that bank or company which to be truthful is a ludicrous situation.
Mr Brian Binley 59
My real concern however is that as you will see from the letter of 6th November, it is necessary for me to cease renting the property as from the end of the current financial year, which I take to mean March 31st 2009. I do not need to tell you that this places me in a very difficult position.
Firstly, because of the present financial situation, forcing my company to sell the property could mean a sizeable loss for those close associates who had agreed to buy the property to help me in the first instance.
Secondly I won the seat in 2005 with a 4,400 majority and boundary revision has meant that I lose approximately 6000 majority, meaning that I now represent a seat which to all intents and purposes is classified as a Labour seat, with a majority of approximately 1600. In other words there is a distinct possibility that I will cease to be elected at the next election and this will create a quandary in itself for I could not possibly take on another lease in the knowledge that at most I will be taking it on for 12 months. However if an election were called earlier then we could be talking a matter of 2 months and to move in those circumstances would be onerous indeed.
I am told that I can appeal against the decision of the Fees Office to the final arbiter of these issues, your good self, and I consequently make that appeal to you.
I recognise that I cannot argue to continue the present situation longer than the present parliament but I would equally state that to make a change before that time would create sizeable hardship and difficulty in the way explained. My appeal therefore is to allow the arrangements, which I was told were within the spirit and the letter of the rules when I entered into them, to continue until the end of this parliament.
Suffice it to say that my record shows that I treat taxpayers' money with great care. Indeed for the last year that records were produced I was in the bottom third of all Members of Parliament in this respect.
Can I conclude by thanking you for your consideration and add that I would be delighted to meet with you for a short time if your busy schedule allowed in order to explain the matter further.
26 November 2008
14. Letter to Mr Brian Binley MP from the Speaker’s Secretary, 18 December 2008
Mr Speaker asked me to write to you having studied, closely, your letter to him of 26 November. He will happily talk further with you in the New Year.
He recognises that you took advice and followed the rules in December 2005 and that you became aware that the rules had changed in February 2006 (to be effective July 2006) when the Director of Operations wrote to you on 5 April 2006. Between now and then you have discussed the matter regularly with [the Director].
Mr Speaker is concerned that, as things stand, you will be placed in a difficult position if, after 31 March 2009, you remain in the arrangement against the rules and having had nearly three years' grace since learning that they will be changing.
Mr Speaker asks that you go and see [the Director]. If it helps, please come back to Mr Speaker again, but time is short.
18 December 2008
15. Letter to the Speaker’s Secretary from Mr Brian Binley MP, 19 January 2009
Thank you for your letter of 18th December and the implied interest, I am most appreciative. I have already had a series of meetings with [the Director of Operations at the Department of Resources] and he suggested that I ask the Speaker for a brief meeting in order to be able to appeal against a decision which he feels he must pursue on the basis of the present Green Book, but which would be overruled on the basis of the new Green Book, which hopefully be adopted later this week.
60 Mr Brian Binley
I therefore would be most grateful if you could arrange for a short meeting of 15 minutes to allow me to appeal on the basis of my difficult predicament, which will cost myself and others a great deal of money through no fault of my own.
I look forward to your positive response.
19 January 2009
16. Letter to Mr Brian Binley MP from the Director of Operations, Department of Resources, 13 March 2009
Thank you for contacting me this week about the arrangements you are making to move from your current London home to new accommodation. You also advised me of your recent conversation with Mr Speaker.
I can confirm that the House will continue to meet costs associated with your current flat until 30 April 2009. Please notify the Department of your new address as soon as you are able.
I attach examples of those items of expenditure which Members with rented second homes are able to claim under the current rules of the Additional Costs Allowance. New rules come into force from 1 April and although in general these items would continue to be reimbursable costs, you should note that the overall cost of furnishings in any one year is limited to 10 per cent of the available allowance. For 2009/10 this is £2,422.
If you are unsure about whether an expense may be met from the allowance, please contact the Enquiries and Advice Team on (ext 1340) for advice.
13 March 2009
17. Letter to Mr Brian Binley MP from the Commissioner, 14 July 2009
Thank you for your letter of 10 July in response to mine of 2 July about this complaint in respect of your ACA claims for your London residence.
I am most grateful for the further documentation you have provided.102 I hope I am right in concluding from sight of the letting agreement that it was on a 12 month renewable basis expiring on 1 February each year. I would be very grateful if you could just confirm this for me.
I propose now to consult the Department of Resources. When I receive their response I will be back in touch. And I will be considering further with the Registrar of Members’ Financial Interests any registration issues.
Thank you again for your help.
14 July 2009
18. Letter to the Director of Operations, Department of Resources, from the Commissioner, 14 July 2009
I would welcome your comments and advice on a complaint I have received against Mr Brian Binley MP about his claims against the Additional Costs Allowance.
I attach a copy of the complainant’s letter of 17 June, together an online version of the newspaper article which he enclosed; my letter to Mr Binley of 22 June; Mr Binley’s response of 30 June with its enclosures; my letter to Mr Binley of 2 July; his response of 10 July, with its attachments; and my letter to him of 14 July.
102 WE 10, WE 11, WE 12
Mr Brian Binley 61
In essence, the complaint is that Mr Binley claimed for property which he rented from a company in which he and his wife had an interest, contrary to the rules of the House.
I would welcome your advice and comments on this complaint. In particular, it would be helpful to know whether there is anything you would like to add to what you said to Mr Binley in your letter of 31 October 2008, a copy of which was enclosed with his letter to me of 30 June. Could you also let me have copies of any other relevant notes or records on your files in relation to this matter? And I would welcome your view on how it has come about that, while Mr Binley was told of the Department’s decision in its letter of 23 March 2006, it was not until March 2009 that the arrangement ceased.
In addition, it would be helpful if you could let me have a summary of Mr Binley’s ACA claims for each of the last four financial years.
Finally, I have written to Mr Binley to ask him to confirm my reading of the letting agreement he sent me which is that it was on a 12 month renewable basis expiring on 1 February each year. I will let you know when I have his response.
Any other information and advice you may be able to give me would, of course, be very welcome.
I would be grateful if you could let me have a response to this letter within the next three weeks. Thank you for your help.
14 July 2009
19. Letter to the Commissioner from Mr Brian Binley MP, 24 July 2009
Yes my contract was renewable annually, but of course had I moved as stated in an earlier letter, the reasons for my appeal would have fallen through as a result of that move which would have defeated the point totally.
You will know that I was very concerned that arrangements entered into over a long period should not be affected by rule changes during the period of a Parliament as happened in my case.
I would finally say that the Fees Office kindly recognised this fact by continuing to pay me until March 2009 when the appeal process finally came to an end.
I do hope the above is helpful to you.
24 July 2009
20. Letter to the Commissioner from the Director of Operations, Department of Resources, 27 July 2009
Thank you for your letter of 14 July about the above complaint. You are aware of the correspondence between Mr Binley and the Department and my letter to him of 31 October 2008 which sets out the Department's position. Mr Binley changed his second home on 25 April 2009. On the policy aspects of the case there is little more I can add that is not already covered in my October letter, although the Standards and Privileges report on Sir Nicholas and Lady Winterton (HC 744) is relevant.
Your principal question appears to be about the chronology of events and the length of time it took to cease payment of Additional Costs Allowance (ACA) to Mr Binley in respect of his second home … Broadly the position is that the arrangement was within the Green Book rules when entered into in February 2006. Mr Binley was then notified of a likely change to the Green Book in June 2006 and the new rules came into effect in July 2006. Mr Binley was given until 31 March 2007 to make alternative arrangements.
For reasons not entirely clear to me this timetable for making alternative arrangements was allowed to slip. However, it is relevant that in February 2008 an investigation by you into the circumstances of Sir Nicholas and Lady Winterton's ACA claims began in which Sir Nicholas and Lady Winterton questioned the Department's interpretation of the Green Book and its right to enforce this interpretation through ceasing to pay ACA.
62 Mr Brian Binley
The Standard and Privileges report (HC 744) of 18 June 2008 was clear about the proper interpretation of the rules and in its view of the necessity for the Members—and by extension others in a similar position—to make alternative arrangements.
I first had contact with Mr Binley in February 2008. At a subsequent meeting with him in March I made it clear that the Department required him to move from his current address if he was to continue to claim ACA into the future. I indicated that I considered that the House could not continue to pay ACA for his current second home beyond March 2009. I wrote to Mr Binley on 31 October confirming the position.
In November 2008 Mr Binley chose to make representations to the then Speaker of the House about the Department's decision. Mr Speaker Martin felt unable to support Mr Binley's case and notified him accordingly. Given the elapsed time, I agreed to a suggestion that the timetable for ceasing ACA for [the London property] be extended by one month to 30 April 2009. As mentioned above, Mr Binley moved accommodation on 25 April and no claims were met in respect of [the London property] after that date.
I enclose a summary of Mr Binley's claims for the last four year along with a confidential internal memo from me following my March 2008 meeting with Mr Binley, both of which were requested by you.
27 July 2009
21. Extracts from Internal Memorandum to Department of Resources’ staff from the Director of Operations, Department of Resources, 25 April 2008
This is to record two discussions I have had with Members fairly recently and to ask that you ensure that appropriate action is taken when the time comes
Brian Binley
I met Mr Binley on 26 March to discuss his ACA home. Briefly he claims rent on a London flat which is owned by a company of which he was the founder and he and his wife are still major shareholders
…
He understands that this arrangement is outside the rules, but … he argued that because the rules changed after he had made the arrangements they should be allowed to continue until the next election.
I told him at the meeting that this was not possible and that I have agreed with the Clerk that his arrangement and others … must end by 31 March 2009. After this date we will no longer meet his ACA claims for this property (it is a slightly interesting question whether if he chose to claim for, say, food, whether we would pay it.)
Mr Binley accepted this advice. He asked that it not be put in writing; but he fully understood the position (although he didn't agree with our ruling) and accepted that the House would not extend the arrangement beyond this date.
…
the position needs to be noted and watched. I need to be kept in the picture of any changes, please.
25 April 2008
22. Letter to the Director of Operations, Department of Resources, from the Commissioner, 30 July 2009
Thank you for your letter of 27 July responding to mine of 14 July about the complaint against Mr Brian Binley MP in respect of his claims against the Additional Costs Allowance.
Mr Brian Binley 63
It was most helpful to have your statement of the position. As you identify in your letter, I need to be clear about the chronology of events and to understand the background to the length of time it took to cease payment of the Additional Costs Allowance in respect of the second home in which Mr Binley had an interest as director of his company. I need also, where possible, to see the documentary evidence which substantiates the chronology.
I have prepared, therefore, the attached table setting out the chronology of events as reflected in the information you and Mr Binley have given me.
I would be grateful if you could confirm this chronology – or add to or amend it as necessary. I would be grateful, too, if you could put in any of the dates which are at present uncertain. And I would be particularly grateful if you could focus on the evidence column and provide any documentary evidence you may hold in respect of the events identified.
Once I have your response, I propose to write again to Mr Binley to show him your correspondence to me, the documentation I hope you will be able to provide, including a copy of your internal memo following your 2008 meeting with him, and the chronology of events.
It would be very helpful if you could let me have a response to this letter within the next two weeks. But I recognise that that may not be possible and, if that is so, would be grateful if you could let me have a response by the end of August.
30 July 2009
23. Letter to the Director of Operations, Department of Resources from the Commissioner, 4 August 2009
I last wrote to you on 30 July for further help on the chronology of events in relation to the rent claims by Mr Brian Binley MP against his Additional Costs Allowance.
I have now received a letter of 24 July from Mr Binley confirming that his contract was renewable each year and noting that you recognised Mr Binley’s argument that arrangements entered into over a long period should not be affected by rule changes during the period of a parliament. I enclose a copy of Mr Binley’s letter of 24 July, together with a copy of my letter to him of 14 July to which this was the response.
Any further comments you might wish to make on Mr Binley’s interpretation of your view would, of course, be welcome with your reply to my previous letter, which I hope could be with me by the end of the month.
I am letting Mr Binley know that I have copied his letter to you.
4 August 2009
24. Letter to the Commissioner from the Director of Operations, Department of Resources, 10 September 2009
Thank you for your letters of 30 July and 4 August about the above. You have asked me to review a table of the chronology of events in this case, to supply any further relevant information and to comment on Mr Binley's letter of 24 July.
I am now able to attach a revised table of events as requested.103 I am sorry this has taken some time but you will appreciate that a number of Departmental staff were involved in this case over some three years. I am also able to attach copies of those documents referred to in the final column of the table.
103 WE 25
64 Mr Brian Binley
The table demonstrates that throughout the period the Department's basic assessment of Mr Binley's claims for rent for [the London property] was the same, namely that they were outwith the rules in force at the time or outwith the rules about to come into force.
Letters from the Assistant Director of Operations of 23 March and 5 June 2006 were clear that Mr Binley's claims for rent could not continue indefinitely. At this stage the new rules had not been formally codified into a revised Green Book and, understandably perhaps, Mr Binley chose not to act in anticipation of such changes to the rules. A new Green Book was duly issued in July 2006. However, no immediate action was taken either by the Department or by Mr Binley himself to bring to an end the payment of rent for [the London property]
In February and again in March 2008 in discussions with Mr Binley I reiterated the Department's view of the position and set a new deadline for the arrangements to come to an end (see my internal memo of 25 April 2008). Mr Binley disagreed with the Department's interpretation of the rules and his reasons for doing so were summarised in my letter of 31 October 2008.
You will be aware that during this time the Department's attention was also on a similar case involving Sir Nicholas and Lady Winterton. The Department's interpretation of the Green Book in this case was being closely scrutinised, including by the House's own legal advisers. There is a reference to this effect in paragraph four of my letter to you of 18 April 2008 (HC 744, page 33).
Notwithstanding the element of uncertainty that existed, my view at the time was that it was right to leave in place the deadline I had set Mr Binley to leave [the London property]. My letter of 31 October 2008 therefore merely documented the understanding between Mr Binley and myself, including restating the Department's position in respect of his claims after 31 March 2009. The timeframe recognised that Members cannot easily and quickly change their London home arrangements and some transitional period was appropriate.
In November Mr Binley exercised his right to seek a determination from Mr Speaker on his case.
I hope this demonstrates that from March 2006 through to October 2008 the Department was entirely consistent in its interpretation of the Green Book and entirely transparent in this in its dealings with Mr Binley. Thus, 'recognising' Mr Binley's arguments was no more than expressing the view that these were not without merit.
I hope this explains the position.
10 September 2009
Mr Brian Binley 65
25. Mr Brian Binley MP - Chronology of Events
Date Event
22 November 2005 Mr Binley speaks to Department of Finance and Administration (DFA)
22 November 2005 Mr Binley writes to DFA to confirm whether proposed arrangements are acceptable.
November 2005 Telephone advice given by DFA – reportedly saying arrangements meet Green Book requirements
February 2006 Rental payments on the London property start
23 March 2006 Assistant Director of Operations replies: refusing agreement to meet rental costs because new edition of Green Book when published will prevent it.
5 April 2006 Mr Binley receives letter from Department of Resources advising of change to Green Book
25 May 2006 Mr Binley writes to Assistant Director of Operations
5 June 2006 Assistant Director of Operations agrees to extend ACA claims, but requires alternative arrangements by end of financial year 2006-07. Assistant Director of Operations suggests review in autumn
July 2006 New Green Book sent to all Members
August 2006 – January No developments. 2008
20 February 2008 Director of Operations has meeting with Mr Binley on 20 February
26 March 2008 Director of Operations has further meeting with Mr Binley
June 2008 Standards and Privileges Report HC744 published
Summer 2008 Telephone conversations between Director of Operations and Mr Binley
19 September 2008 Mr Binley requests meeting with Director of Operations
October 2008 Director of Operations meets Mr Binley
31 October 2008 Director of Operations writes to Mr Binley – arrangements must come to an end by end of 2008-09
26 November 2008 Mr Binley writes to the Speaker appealing the decision
18 December 2008 Speaker’s Secretary writes expressing Mr Speaker’s concerns about Mr Binley’s difficult position and suggesting Mr Binley meets with Director of Operations
19 January 2009 Mr Binley asks for a meeting with Mr Speaker
66 Mr Brian Binley
March 2009 Mr Binley meets Mr Speaker – appeal rejected, but can claim to 30 April 2009
March 2009 Telephone conversation between Mr Speaker and Director of Operations about outcome of appeal
13 March 2009 Director of Operations writes to Mr Binley confirming the House will pay costs until 30 April 2009
25 April 2009 Mr Binley moves flat
26. Note of telephone conversation between Department of Finance and Administration advice team and Mr Brian Binley MP, 22 November 2005
Enquiry ID:
MP/Supplier: BRIAN BINLEY MP
Allowance: ACA
Sub1: GUIDANCE
Sub2: OTHER
Query: I wish to lease a flat in London a company is buying in which both my wife and myself are 20 per cent shareholders, is this OK ?
Advice: We need to consider all the implications. Please send brief written details to [first official] who will make a decision.
Date: 22/11/2005 09:08:53 Closed: 22/11/2005 09:08:53
User:[second official]
27. Note of telephone conversation between Department of Finance and Administration advice team and Mr Brian Binley MP, 22 November 2005
Enquiry ID:
MP/Supplier: BRIAN BINLEY MP
Allowance: ACA
Sub1: GUIDANCE
Sub2: OTHER
Query: Mr Binley has requested to send a letter to someone in F & A in connection with his renting a flat. What is the person’s name.
Advice: [first official] Agreed they will send a hard copy rather than an email to ensure a quick response.
Date: 22/11/2005 18:00:35 Closed: 22/11/2005 18:00:35
User: [second official]
Mr Brian Binley 67
28. Extracts from letter to all Members from the Director of Operations, Department of Finance and Administration, 25 July 2006
The Green Book: Revised Edition and Other Matters
I am pleased to be able to let you have (i) two copies of the new Green Book, published in accordance with the instructions of the Members Estimate Committee (MEC), (ii) The Second Edition of the Concordance of Resolutions, (iii) a new Quick Guide, (iv) a copy of the Department of Finance and Administration's new newsletter and related briefing material, and (v) a letter about Parliamentary Pensions. This is a weighty package to distribute just as the House rises, but I considered it important to ensure Members had this material for the summer break.
The Green Book
I would like to draw your attention to the revised Green Book and to some of the main changes from the 2005 edition.
Additional Costs Allowance
The new guidance strengthens the accountability rules to bring the allowance rules more in line with those relating to the Incidental Expenses Provision. These include matters to do with conflicts of interest and joint ownership.
On advice from the Advisory Panel on Members' Allowances, the MEC decided to allow Members more flexibility to increase the value of mortgages on their ACA home. The new rules make it clear that you can only do this if you are moving to new accommodation or if you are repairing or improving your existing ACA home. The new guidance strongly advises Members to discuss any proposals to change ACA arrangements with the Department of Finance and Administration (Enquiries and Advice Team on x1340).
The Section 3 of the Green Book is revised as follows:
• new paragraphs 3.3.1 - 3.3.3, which consider basic principles behind claims for ACA;
• new paragraphs 3.7.1 - 3.7.3 dealing directly with mortgages, which clarify the rules relating to mortgage providers but also reflect the MEC's decision of July 2005 to allow re-mortgaging in certain circumstances; and
• changes allowed under the rules as a result of the decision on re-mortgaging - paragraphs 3.13.1 and 3.14.1.
…
25 July 2006
29. Letter to Mr Brian Binley MP from the Commissioner, 11 September 2009
This letter is to show you the advice I have received from the Department of Resources on the chronology in relation to this complaint about your rent claims, and to invite any comments you may wish to make.
I wrote to you on 14 July and again on 4 August, when I let you know that I was consulting the Department of Resources. I attach a copy of my initial letter to them of 14 July; a copy of their initial response of 27 July, together with its attachments; my follow-up letter to them of 30 July with a chronology of events; and their response of 10 September with the two relevant letters and a revised chronology of events. They have also advised on the complaint which, as you will see, is that your claims were outwith the rules in force at the time, and outwith the rules about to come into force. You will see also that the Department’s view is that the arrangement was within the rules when you entered into it in February 2006.
68 Mr Brian Binley
I would welcome your comments on the Department’s response and on the accuracy of the chronology enclosed with their letter of 10 September.
Subject to the comments you make, I may need to consult further the Department of Resources. I think it may then be helpful if we met for an interview before I come to a conclusion on this matter. At this stage I am considering whether I should submit a memorandum to the Committee on Standards and Privileges about this complaint, but I will decide that once I have received and considered your response and all the other evidence you have helpfully provided. If I do need an interview with you, I will write to you nearer the time to let you know a little more about the process and the areas I suggest we need to cover.
If you could let me have a response to this letter by the end of the month, that would be most helpful. Thank you again for all your help.
11 September 2009
30. Letter to the Commissioner from Mr Brian Binley MP, 15 September 2009
I am grateful for copies of correspondence from the Fees Office enclosed in our letter of the 11th September and am happy with the general accuracy of their chronology which I believe overwhelmingly coincides with my own understanding of the situation.
It is interesting, however, that no comment is made with regard to my general concern to the effect that Members should not be expected to change long-term contractual agreements within the period of a Parliament and indeed that rule changes impacting upon long-term contractual arrangements should not be made during that period.
Furthermore, there is no cognisance of the fact that eventually the third Green Book produced during this Parliament included a general principle to that effect which would seem to justify the battle I fought and position I took.
The second point I would make relates to the responsibility of the Fees Office to disallow claims they disagreed with thus underlining their function in this respect. As a new Member of Parliament, I was under the impression that the judgment of the Fees Office was vital with regard to the correctness of a contractual agreement and indeed that is exactly the position I pursued with regard to my own original arrangements and I am delighted to learn that the Fees Office has again confirmed the correctness of those arrangements.
The very fact that the Fees Office laid down an initial period for which they agreed to pay rent intimated to me that I could correctly claim for that rent during that defined period. Indeed that position seems to have been confirmed in [the Director’s] letter of the 31st October 2008 when he specifically stated that I had done nothing wrong up to that point but that he could not allow the payment of rent for my existing flat beyond the end of the financial year, 2009, all of which confirms to me that it was the Fees Office's decision as to whether or not a claim was allowable in this respect.
Finally, I welcome [the Director’s] confirmation that I had the right to appeal to the Speaker and thereafter acted on the Speaker's ruling immediately and that following further discussions, [the Director] kindly allowed me a further short period of grace in order to vacate the flat I was renting from the company of which I was a minority shareholder thus confirming again the Office's power to allow a claim or otherwise.
Given those lengthy involvements with the Fees Office and the fact that their authority was clearly established by their own actions, I simply fail to understand where any wrongdoing might have occurred and I am therefore hopeful that you will come to the same conclusion.
Can I conclude by thanking you again for the correspondence contained in your communication of the 11th September and add that I would be delighted to have the opportunity of meeting with you prior to the announcement of your final decision on this matter.
15 September 2009
Mr Brian Binley 69
31. Letter to Mr Brian Binley MP from the Commissioner, 25 September 2009
The purpose of this letter is to let you know what consideration I and the Registrar of Members’ Financial Interests have given to the question of whether you should have registered any benefit from your accommodation arrangements in the Register and to invite your response.
I wrote to you about this on 2 July when I raised with you the question of whether you should have registered a benefit. It appeared from what you had told me in your letter of 30 June that your London flat may have been subsidised by the Landlord, BCC Marketing Ltd, of which you are a shareholder.
My letter of 2 July set out the relevant registration rules and asked whether you considered that you should have registered a benefit.
You replied in your letter of 10 July that the rent was not a benefit in kind on the basis that you were charged a commercial rent, that if you had continued to rent the property over a longer period the shortfall experienced by the company would have been eradicated and that there was no intention that the company should subsidise you.
When I wrote to you on 14 July, I noted that I would be considering this issue further with the Registrar.
In your letter of 30 June you had told me that you paid to BCC Marketing Services Ltd £1,500 a month which included council tax, water rates, electricity and gas costs and that the company bought all of the furniture, white goods and other furnishings used in the flat. The company had taken out an interest-only mortgage for £345,000 (the cost of purchase) at the time of purchase and the interest payment when you embarked on the arrangement amounted to £1,600 a month.
On this basis it would seem that, in the first year at least, there appears to have been a benefit to you of £100 a month (or £1,200 in the year), excluding the contribution which would need to be made in this monthly rent to the company’s purchase and initial furnishing costs.
I have, however, not been able to reconcile this figure with the figures for the first 39 months which you annexed to your letter of 30 June and which show an overall deficit of £9,774. Setting aside the necessary contribution to the company’s costs of purchasing and furnishing the property, it would seem that your rent exceeded the costs by £7,708 over the 39 months.
Before the Registrar could give reliable advice on this, therefore, I would need to have a calculation by calendar year of the company’s costs (including the amortised purchase and initial furnishing costs). I would also be grateful if you would check the total running cost figures you provided (parking, lighting and heat, insurance, council tax and water) since some appear quite low for a 39-month period. That would enable me to compare the annual cost of the apartment with the annual rental income (which I understand was £18,000).
I am sorry to trouble you further on this, but if you could let me have a response, ideally within the next week, I will write to you again with the Registrar’s advice. I think it would be helpful to have this resolved before we meet for our interview.
25 September 2009
32. Statement from Financial Director of BCC Marketing Services Ltd, 12 October 2009
Rent of flat at … by BCC Marketing Services Ltd to B A R Binley for the period from January 2006 to April 2009.
The leasehold flat was purchased in December 2005 for a basic price of £345,000. Stamp Duty of £10,350 was paid together with various Legal & Professional fees of £3,134. The total of £358,484 was capitalised in the company's books. As the leasehold was in excess of 100 years it has not been thought necessary to amortise the lease in the company accounts. A deposit was paid by the company and the balance of £297,000 was provided by a repayment loan from [name of bank].
70 Mr Brian Binley
In order to set a level of rent, telephone calls were made to estate agents in the Pimlico area. The general consensus of opinion was that for a flat of that value in that area, an annual amount of £18,000 would seem to be appropriate. This figure was applied so that Mr Binley, as a director of the company, would not be subject to a benefit in kind.
The attached schedules show that BCC suffered a deficit from the rental in 2006 (£2,656), 2007 (£3,450) and, to a lesser extent, in 2008 (£133). A gain arose in the short period in 2009 (£3,346). These figures would have been the same had the flat been let on the open market as the rent was set at normal commercial rates.
Since the flat was vacated by Mr Binley in April 2009 it has been re-let to unconnected persons at a rent of £385 per week, or £20,000 p.a. This would indicate that the rent set three years earlier was a true market rent at that time.
12 October 2009
33. Letter to Mr Brian Binley MP from the Commissioner, 29 October 2009
I wrote to you on 19 October in response to your letter of 12 October about the question of whether you should at any time have registered a financial benefit in respect of the flat you rented from the company in which you and your wife had an interest. I said then that I would be consulting the Registrar of Members’ Financial Interests. I have now done so, and what follows reflects her advice.
The statement from [the Financial Director], which you enclosed with your letter of 12 October, says that local estate agents were consulted before setting the rent. This consultation indicated that £18,000 annually was an appropriate rent for the type of flat in the area. This figure was applied so that, as a Director of the company, you would not be subject to a benefit in kind.
The figures provided by [the Financial Director], however, also suggest that in the first two years of the arrangement the company made a significant loss, with a smaller one in the third. This raises the question of whether you had received a benefit by virtue of this loss.
The purpose of the Register is “to provide information of any financial interest or other material benefit which a Member receives which might reasonably be thought to influence his or her actions …. taken in his or her capacity as a Member of Parliament”. As you see, the question is not only whether you received a benefit but whether you might reasonably be thought to have received one.
The Register is compiled on the basis of whether or not a Member receives a registrable benefit within a calendar year.
Under the rules current from July 2005 until July 2009, Members were required to register, under Category 5, “any material benefit of a value greater than one per cent of the current parliamentary salary, from any company, organisation or person within the UK, which in any way relates to membership of the House”. In 2005 the relevant figure was £590, and in 2006 it was £600.
In the light of this summary of the relevant rules, the Registrar’s view, which I emphasise is provisional at this stage, is that it would have been appropriate for you to have registered a benefit in 2006 and 2007, since the difference between your rental payments and the company’s outgoings on the flat exceeded £650.
It would be very helpful to have your comments on this advice. If any written comments could reach me by noon on 7 November, that would enable me to take them into account when we meet the following day. Alternatively, you may wish to cover this at our meeting.
I look forward to hearing from you.
29 October 2009
Mr Brian Binley 71
34. Letter to Mr Brian Binley MP from Financial Director of BCC Marketing Services Ltd, 2 November 2009
I refer to the letter from John Lyon CB dated 20 October 2009 headed 'Complaint from Michael Barnbrook'. Mr Lyon is asking whether you received a benefit from BCC Marketing Services Limited during the time that you rented a flat from the company.
I have already produced schedules that show that in the first two years of your occupancy the company did in fact suffer a deficit on the transaction, but that this was being remedied in year three. What I did not show in those schedules was the increase in value of the company investment in the property. The Board of Directors regularly monitored the letting arrangement during the course of your tenancy and was always satisfied that any deficit in revenue was more than compensated for by an increase in the capital value. Despite the fall in residential property values in certain areas in recent times, the Board is satisfied that the current value of the property exceeds the purchase price. This is confirmed in the fact that the flat is currently being let at a rental of £20,000 p.a., reflecting the increase in capital value.
It is the view of the Board of Directors that at no time did the company suffer an overall deficit during your tenancy and that therefore, you could not have received any benefit.
2 November 2009
35. Agreed note of interview with Mr Brian Binley MP, 5 November 2009
Present:
John Lyon [JL]
Brian Binley MP [BB]
Notetaker
Introduction
JL Thank you for coming in.
This is [the notetaker]. She will take a note of our discussion and show it to you so you can be satisfied as to its accuracy. It will be fairly full but it will not be verbatim.
The note will be included in the memorandum I submit to the Committee on the complaint and you can expect it to be published with the Committee’s Report.
I wrote to you on 29 October to set out the procedure and to give you the main areas I wanted us to cover. Other matters may arise during the course of the interview. Are you content for me to start?
BB Yes. But I would like to ask three or four questions later.
The Facts
JL Can I first confirm the facts? The company was founded by you. You held over the period 2006– 2009 a 20 per cent shareholding, as did your wife; your son, … held a further 20 per cent and you were (perhaps still are) the Chairman of the company.
72 Mr Brian Binley
BB Yes, I am non-executive chairman and I am paid £8,000 per year. … my adult son, is managing director.
JL You consulted the Department of Finance and Administration [DFA] in writing in November 2005 and a few days later rang them and were told orally that it was acceptable for you to rent the company flat and to claim the full rent under the Additional Costs allowance [ACA].
BB Yes. I consulted them earlier in the autumn. I took the precaution of clearing my arrangements with them. It was a verbal discussion.
JL The company bought the flat in December 2005 and you began the rental arrangement in February 2006.
BB Yes. In the meantime my company had spent money furnishing the property.
JL In March 2006, you were told in writing that your arrangement was not acceptable under the Green Book rules about to come into effect.
BB Yes.
JL You challenged that ruling in May 2006 and were told in June 2006 that you had to bring the arrangement to an end by March 2007.
BB Yes.
JL You took no action till February 2008, when you again challenged the ruling.
BB There were a number of discussions with the Department. As I said to you in my letter of 10 July “ much of the transactions were done either verbally, at meetings or on the telephone…”
I realise that I can’t prove these conversations. And not all the letters are included in the files.
JL We will come to those discussions later, and to the period from June 2006 to February 2008. On the facts, you were told in a meeting with the Department of Resources of 26 March 2008 that the arrangement must end by 31 March 2009. You spoke on the telephone to the Department over the summer and had a meeting in October, after which the Director of Operations said to you in a letter that the arrangement must end by 31 March 2009.
BB Yes.
JL You appealed to the Speaker in November 2008. In March 2009 your appeal was rejected, but you were allowed to continue claiming for the firm’s flat until the end of April 2009.
BB Yes.
Mr Brian Binley 73
JL You moved from the flat in April 2009.
BB Yes.
JL On this basis, it seems you challenged the ruling three times—in May 2006, in February 2008 and in November 2008.
BB In those terms I can’t disagree. But I saw the whole process as an appeal. As I have explained, it was about changing the rules mid term. The appeals process was wider than implied by those three dates.
JL It seems you took no action on the first ruling in May 2006 until you discussed the issue again with the Department in February 2008. But I will take further evidence on this.
November 2005
JL You told me in your letter of 30 June 2009 that you decided to set up in the flat to avoid stress on your wife should anything happen to you. Can you explain your thinking a little more fully?
BB I am eighteen years older than my wife. I was 63 when I came into Parliament. I felt that to take out a liability at that stage would place her in more difficulties should anything untoward happen.
I had an offer from members of my Board, because travelling up and down with a suitcase each weekend was getting hard work. I put the offer to the Fees Office who recognised that I was not renting from myself. Indeed the Director of Operations’ letter of 31 October 2008 recognises that I was not leasing from myself. I had earlier had confirmation of this in the Assistant Director’s letter of 5 June 2006. It was not against the rules to rent from a company.
The Director said in his letter of 31 October 2008 “I fully accept that you have acted properly at all times in respect of this matter.”
JL Did you consider other options?
BB Yes, I did. But have I got proof? I doubt it.
I thought of renting from someone else , but I didn’t want to go through the process of looking for somewhere. And I was then living in the Carlton Club which was not satisfactory by any means.
When the offer came about it seemed attractive, and having as landlords people I know seemed an advantage. I went to the Fees Office, they said it was okay, so I proceeded.
JL Am I right in taking from your letter of 22 November 2005 that the original intention was to share the flat with two Directors of the company, BCC marketing? When did you drop that idea? And why?
BB Yes, the idea was that it would be available for use by members of the company. They come down occasionally. We thought the flat could be of use when they had to stay overnight. But the
74 Mr Brian Binley
Fees Office advised that it wouldn’t be sensible. As a consequence I didn’t pursue it. In my letter of 10 July I said that we were advised that the flat could not be used in that way.
JL You wrote to the Department on 22 November 2005. When did any discussion take place?
BB Before we bought the flat. It was pointed out to me that using the flat by the company would not be sensible, so we didn’t do it. It never happened.
JL You wrote to the DFA in November 2005. Would you not have expected a written reply on a matter of such importance?
BB Not necessarily. I had a number of conversations that didn’t involve letters.
I only came in to the House on 5 May 2005. I was still overwhelmed by the experience. I was not as careful as I ought to have been. In the light of what I know now, I would have asked for a letter each time.
JL Can you recall who you spoke to on the phone, which, according to the schedule agreed, happened a few days after your letter?
BB No, forgive me.
JL What did they say?
BB They told me that sharing was not proper, but the arrangement for renting was not against the rules. I was not leasing from myself.
JL Did they promise to write?
BB I don’t think so.
JL Did you ask them to write?
BB No.
Let me explain. Joining the House was the most overwhelming experience, and I was on a steep learning curve. I wish I had had the capacity to deal with it in a more realistic manner.
JL Did you consider writing a confirmatory letter setting out your understanding of the advice given?
BB No. I wish I had.
March 2006
Mr Brian Binley 75
JL You then started the rental in February 2006. Did you expect the Department’s letter of 23 March 2006?
BB No.
JL Why did you not accept the advice and find another flat?
BB Well, I had signed a lease.
JL For a year.
BB Yes, but it is also about the ambience. People – my Board - were helping me out. Having got them into that situation, I felt that there was a responsibility on me. I had accepted a situation they were not knowledgeable about. I owed it to them to take things further.
I felt that treating people in this way was unacceptable. I was very angry not only for myself but for other people. I would never dream of treating my employees like that. If I did I would face an industrial tribunal.
I saw no reason why the House of Commons should not act decently. That is why I campaigned so hard. People should know where they stand. It is a matter of human decency.
JL In the end you moved out quite quickly. Would it have been possible for you to have moved out earlier if you had wished?
BB Let me say that I hold my responsibility very seriously. The situation was unsatisfactory and not of our making. I felt it was very very wrong.
My constituents have sent me here to fight injustice. I have fought it all my life. It seemed wrong to change contractual arrangements mid term, not least within months of being given the go ahead.
I went to the Fees Office for advice. The first page of the Green Book says “In cases of doubt or difficulty about any aspect of the allowances or how they can be used, please contact the Department of Finance and Administration. The Members Estimate Committee… has recently restated the Department’s authority to interpret and reinforce these rules.”
I had accepted what the Fees Office said as totally credible and meaningful. To find that the advice stood only for a matter of months was outside the world of reality as I know it in business. On that basis I appealed.
JL But they gave you nine months to move.
BB I appealed.
JL But would it have been possible for you to move out earlier if you had wished?
BB Of course. But I was saying that this was wrong and I wanted it reviewed. If I had moved the
76 Mr Brian Binley
reason for my appeal would have ceased to have any meaning.
JL Why did it take from 23 March 2006, when the Department wrote to you, to 25 May 2006, when you wrote to the Department—that’s two months—for you to challenge the decision?
BB This is the hardest job I have ever done. I have founded two companies, which together now employ 230 people. But Parliament takes more of my time and attention than anything else I have ever done. There are so many things crowding in on you. Things take an order of precedence; some things are urgent and they get done in that order.
JL Were there phone calls?
BB I can’t say there were calls, but there were other conversations that took place. 1
June 2006
JL The Department wrote on 5 June 2006 agreeing to allow you until March 2007 to make alternative arrangements. Did you accept that deal?
BB I accepted it on the basis that I thought the appeal allowed me to go to Mr Speaker as I understood and as was inferred to me. I expected the issue to have been closed in that time and it wasn’t.
JL But the Department wrote on 5 June 2006, giving you a determination. They agreed to allow you until March 2007 to make alternative arrangements.
BB I was still arguing against that decision.
JL When did you appeal against it? Do you have any evidence of your appeal?
BB Well, why did the Director allow me, in his letter of February 2008, to continue to April 2009?
JL Do you have any evidence of any conversation with the Department between 5 June 2006 and February 2008? Did you write back to the Department to challenge the ruling?
BB I have circumstantial evidence. I refer to the Director of Operations’ letter of 31 October 2008, when he said that there were “a number of discussions”.
The importance of all this has grown enormously. The ambience attached to expenses has grown. We are in a changed world. Would I, knowing what I now know, do it differently? Yes I
1 Mr Binley later suggested that “I can’t be specific about the details of calls “ would be more accurate..
Mr Brian Binley 77
would. But I was a relatively new Member. I should have pursued it more effectively and I didn’t.
June 2006–February 2008
JL On the evidence, you appealed on 26 November 2008 against a decision letter of 5 June 2006. Is that a reasonable period do you think?
BB Well, if you take into account the three months when this place closes down in the summer, it looks less dramatic.
JL It is still 2½ years.
DD There were conversations but no record. So I have no evidence of my actions.
JL I am finding it hard to grasp what appeal was ongoing. You had a clear decision in June 2006, but you appealed in February 2008.
DD I saw the whole process as an appeal process. I intimated my appeal at different stages.
JL So was the appeal process you deciding not to accept the Department’s decision?
Normally there would be evidence of an appeal continuing. I have seen no such evidence.
DD The Director of Operations intimates that such conversations took place. In his letter of 31 October 2008 he implies that there were earlier conversations during the period.
JL Surely those were the conversations that started in February 2008.
But can you give me an idea of who you rang up and spoke to?
DD I didn’t speak to the Director until later, but the Assistant Director came on the scene a bit earlier.
The conversations were still about the correctness of changing the rules mid term. Officials would come back to me and I would come back to them. I intimated I would take it to the Speaker if necessary.
JL Did the Department tell you they were reconsidering your claim?
DD I believed I could make them reconsider.
JL You say in your letter of 15 September that the judgement of the Fees Office was vital. Given that, why did you not accept that judgement when it was made on 23 March and then 5 June 2006?
78 Mr Brian Binley
DD Because I felt it was a battle worth fighting.
JL But if their decision is final, why did you believe they should still pay you?
DD They did keep paying me. They were the enforcement authority – they could have stopped it at any time.
JL Why did you think it acceptable to ignore the Department’s ruling for that period of time and take no action formally to tell them why you were continuing to claim beyond March 2007? Did you take their silence as consent?
BB We were having a conversation, although I can’t prove it now.
JL Did you put any note on your claim forms after March 2007 to make clear that you were lodging the claim against the decision of the Department?
BB I doubt it.
But they knew the situation. I was claiming to the office I was having the discussions with. I remind you that the Director has said that I acted properly.
JL Had the Department ceased paying your claim, would you have accepted that decision, or would you have gone to the Speaker?
BB I would have gone to the Speaker. I had been saying that I wanted to see him. My final appeal was to him.
There is circumstantial evidence of an appeal in that the Department kept paying me and the Director agreed to go on doing so. That suggests to me an agreement to continue. If not, they could have stopped paying me. They were the enforcers.
JL But, in March 1997, was it not the case that, by continuing to claim, you had gone through a red light?
BB I saw it as a total injustice.
JL But it is a Member’s own responsibility to obey the guidance.
BB We are talking about balance there. Successive Green Books are full of confusing statements.
I didn’t in any way want to cheat the taxpayer. The change of rules did fly in the face of reasonableness. I have in part won my case, which proves that. The whole thrust of my argument [about avoiding mid term changes to the rules] was written into the April 2009 Green Book. I am grateful for that … except that the Green Book changed materially only a few months later, in July 2009, when the detail of the rules was changed again. No reference was made to the need to avoid mid term change.
The point for which I had fought so hard was changed, for political reasons. What decency or
Mr Brian Binley 79
principle is there in that?
2008
JL Let me move now to February 2008. Who initiated the contact in February last year?
BB I don’t know.
Well, there were conversations going on, how many I can’t tell you. It was part of the process. They were better documented in 2008, as the ambience of the Fees Office was changing then. The searchlights were already pointing at that area.
JL Between February and October—eight months—it seems there was a series of meetings and telephone conversations between you and the Department. Is that right?
BB Yes, they were about the unfairness of changing rules mid term. I don’t believe you should treat people like that. I have never done that in my business life.
JL Was it what you might call a policy discussion – or was it about your own situation?
BB Both. I was advised early on by a lawyer that if I moved out there would be no grounds for pursuing that appeal.
JL Did you think you were making progress?
BB I was pursuing this in other ways too. I am a member of the 1922 Executive. I kept the ‘22 informed.
The spotlight changed with the whole Conway issue eighteen months ago.
JL You had a meeting with the Department of Resources in March 2008. The note of the meeting says that you accepted the advice that your arrangement must end by 31 March 2009. Is that right?
BB Yes, I felt I had taken the issue as far as I could go. I had received some satisfaction. The Director gave me a fair agreement and a chance to meet the Speaker. That took some time to arrange.
JL Given that you wanted to take the matter to the Speaker, I am not sure how it can be said that you accepted their advice?
BB I did, but I wanted to see the Speaker within their timeframe.
JL Is it not odd to say “I accept your advice but I have decided I want to appeal”?
80 Mr Brian Binley
BB I wanted to continue the appeal to the end and pursue it in discussion with the Speaker. When the Speaker said no I said I needed a little more time to move. He said that that was perfectly fair and I went back to the Director who agreed that that was reasonable.
JL The note also says that you asked that the advice of the Department not be put in writing. Why not?
BB I thought what the Director had said was fair, but I still wanted to go to the Speaker. I didn’t want his advice to be definitive. It was about the ambience of good relations: atmosphere plays a part.
JL Following further telephone calls the Department wrote to you on 31 October saying your arrangements must come to an end by March 2009. They made clear that you had contravened two paragraphs of the Green Book. That was six months after they had already told you of that decision in your meeting of 26 March 2008. Was that not much the same as the decision which they made and which was to have come into effect two years before?
BB Yes, but the Department had continued to pay me and they had a direct responsibility to enforce the rules. That suggests a tacit approval.
JL Does this not suggest you were content for the discussion to go on ?
BB If you meant that I intended to string this out for my own personal benefit, it is totally untrue. It didn’t come into my mind. What counts is what I know to be true. The very fact that I was still fighting a battle about the Green Book underlines that.
JL Why did you not appeal to the Speaker in June 2006 when the same decision was sent to you?
BB I was going through the process. There were two years of phone conversations, but that is not my fault.
JL But you could have gone to the Speaker?
BB I was fighting a battle. That is what the people of Northampton sent me here to do.
JL The Speaker’s secretary’s letter of 18 December 2008 suggested you meet the Department. Did you do so?
BB No. Since the time was limited. I decided I would rather see the Speaker. I had partly achieved my objective in getting the rules changed in April 2009 – even if the changes of July 2009 ignored that change.
The Rules: Registration
JL Could I now apply the rules to your case? First, registration.
Mr Brian Binley 81
BB I wrote to your office about this yesterday. Here is the letter.
JL Thank you. I had not received this letter. I will need to show this to the Registrar and take her advice.
BB I find it ironic that having been accused of stealing the taxpayers’ money I am now accused of just the opposite, of providing them with a benefit.
The initial figures I provided were done on the back of some crude calculations – showing that my successor in the company owned flat was charged £2,000 more and that he had to pay council tax and bills on top.
This question of registration is a different matter. A benefit in kind is a matter for the taxman. It requires a more precise accounting process than I am capable of. I have an accountant to deal with the Inland Revenue, and if he believes it is a commercial rent, I take his advice.
JL Your accountant is unlikely to be an expert on House rules.
BB Yes, but I have no hang ups about this. I am happy to register if you tell me to.
JL Thank you. I will come back to you when I have read the letter.
The Rules: Leasing
JL Could I now turn to the rules in respect of your lease of the flat? The 2005 rules prohibit the cost of leasing accommodation from yourself (3.12.1). You leased accommodation from a company which you founded and in which you had a 20 per cent interest. Were you not in effect leasing accommodation from yourself, at least in part?
BB No. A limited company is a stand alone body. That argument would be much stronger if I was the major shareholder or sole owner.
I cleared that side of the rules with the House authorities. I consulted the Fees Office as the Green Book advised. All the way through, since [the Assistant Director’s] letter it has been accepted that it was not against this rule to rent from a company in this way at the time.
JL Did you not consider that there was a risk in such an arrangement that it could be seen that your use of allowances were not above reproach—contrary to the Speaker’s introduction to the 2005 rules?
BB Forgive me – we either have the Fees Office or we don’t. It would have been unwise of me not to take note of their advice. I abide by the rules.
I will not take the advice of the court of public perception. And if something is not right, don’t change the rules in a way that impacts unfairly on people.
I was told by the Fees Office, by the Assistant Director privately that it was right and proper for me to make this arrangement. And the Director has confirmed that I was not leasing from myself. What should I have said, having been told to take the advice of the Fees Office, that I
82 Mr Brian Binley
wouldn’t listen to them? That would lead to anarchy.
JL The additional provisions in the 2006 rules were set out in the July 2006 Green Book, shortly after you had started leasing your apartment on 1 February 2006. They specifically prohibited claiming for accommodation leased from any organisation or company in which you—or a partner or family member—had an interest. Do you accept that, had you not started your arrangement, that provision would have applied to you and that you could not have leased the flat from your company?
BB Of course. I wouldn’t have done that. Even if I had started the process but not signed a lease, I would not have continued.
JL So why did you not simply find another flat and rent elsewhere—as you were to do three years later?
BB I wish I had thought of these matters. This is the hardest learning curve I had ever climbed. And there is a real lack of support and help for new Members.
JL You say in your letter of 18 September that you fought a battle to change the rules so that Members should not be expected to change long-term contractual agreements within the lifetime of a Parliament. Do you consider your arrangement, which lasted at most a year at a time, a long-term contractual agreement?
BB Yes, of course. It was signed only in February 2006 and I was told of the change in March. Changing my arrangement would have caused sizeable cost to my fellow directors. They had been personally kind to me. Keeping the flat and renting it out would have been an added focus and worry to them. They live in Northamptonshire, and the property is down here. Taking on tenants is a difficult matter.
JL Is it your argument that since you did not agree with the rule you did not need to follow it until you had completed your campaign against it?
BB Not at all. I was appealing against an unfair process. I felt it was dishonest. In the normal world of business it would have been a matter of dispute ending in an employment tribunal.
JL Do you think the Department gave you a reasonable period of time in 2006 in which to bring your arrangements within the rules – nine months?
BB No, they had changed the terms of my contract without paying heed to me. I felt so strongly that I tried to get the decision changed over a period of two years. I tried hard in conversation and in committee. In business you get the information and you make a decision – but in this place it is massively different; you don’t have that degree of control.
It was a different time and ambience. I felt I had been let down and placed in an invidious position.
JL Would you look at it differently now?
Mr Brian Binley 83
BB I am sure I would.
But why didn’t I think then as I would now?
There wasn’t the pressure on allowances that there is now. It was a different time and ambience. I felt I had been let down and placed in an invidious position, affecting people I had worked with for twenty years. Since the Conway case I would look at it differently, I am sure I would.
JL Given the Department’s repeated rulings and the Speaker’s decision, do you now accept that your arrangements were in breach of the rules - at least from April 2007 when the deadline set by the Department had expired?
BB Do I accept the right to change the rules mid term? No, I don’t. The April 2009 Green Book accepted the principle that rules should not be changed in this way.
The people whose job it is to enforce the rules kept agreeing for me to continue to be paid.
And if I had changed my living arrangements, the reasons for my appeal would not exist. I was given this advice by a lawyer. It was because I felt so strongly that I didn’t change them.
JL Do you see any distinction between your policy campaign and your personal position on your flat?
BB I saw a clash between the implication in the Green Book that Members are solely responsible for submitting their claims and the idea of the Fees Office as enforcing authority, but it is easy to highlight one part of the Green Book over another. I was looking just at the front page which was especially highlighted by the Speaker in a way which suggested to me that it was a priority.
I was not trying to be clever or avoid my responsibilities. I was charging the taxpayer fairly and properly. The taxpayer was getting a fair deal.
I thought I was acting in the interests of the taxpayer, myself and colleagues. I wasn’t misdirecting or misappropriating money. It was right and proper to pursue that argument. One of my predecessors, Bradlaugh, fought seven times for his belief. My case is based on the Fees Office having the final say – they are the enforcer.
JL The Speaker’s introduction to the 2005 Green Book gives the Fees Office two responsibilities: to interpret the rules and to enforce them. He asks Members in doubt or difficulty to contact the Department. He then says—“the MEC, which I chair, has recently restated the Department’s authority to interpret and enforce these rules.” Is that not a clear statement from Mr Speaker that Members should abide by the decisions of the Department, even though you said they did not enforce them?
BB I accepted their responsibility to interpret the rules and my right to appeal against them. I appealed against them.
JL Was it reasonable for the appeal in your case to take that length of time?
BB What is it that common law says? I am thinking of the principle of estoppel. It holds that “ if a credible authority gives a ruling on a matter, that ruling must be considered to be a reliable defence should the recipient act upon that advice – provided that no unlawful reason is given
84 Mr Brian Binley
which might have impacted upon that advice.”
JL What do you say to a suggestion that you felt very angry at the Department for apparently agreeing to your arrangement in 2005 and then rescinding that decision just weeks after you had taken up residence, and as a result you were not prepared to accept the Department’s clear ruling and decided to fight it to the end?
BB I would say I was bloody livid. I was prepared to challenge the decision and fight to the end.
JL But there were quite long periods when not much was going on.
BB Taking that perspective, looking back, that is a fair assumption. I can’t prove what was going on.
The Public Purse
JL Finally may I ask you about the impact of your arrangements on the public purse? Having carefully considered the financial arrangements, do you think there was any way in which it could be said that there was any loss to public funds?
BB Not at all.
I didn’t pay for the lease of the flat. If there was a benefit it was to the taxpayer. It wasn’t a luxurious flat. Was it reasonably comfortable for my four days up here? Yes it was. The taxpayer would have been paying more money if I had lived elsewhere. I didn’t misuse the apartment or the taxpayer’s money. In fact any benefit during the period I lived there was to the taxpayer.
Conclusion
JL Any final points you would like to make?
BB Yes. My questions are as follows. Does the evidence confirm that I acted openly and in full knowledge of the Department of Resources from August 2005 to the present?
Is there any evidence to suggest I misdirected taxpayers’ money for my own enrichment?
Is the Director’s letter [of 31 October 2008] accepted, when he says that I have acted properly at all times in this matter?
Do you confirm that as the Speaker said, the Department had the authority to interpret and enforce these rules?
JL Thank you very much indeed. [The note taker] will now prepare a note of our discussion and show it to you so you can comment on its accuracy. As you know, you can expect the note to the included with the memorandum I will prepare for the Committee and it will subsequently be published with the Report. Once I have the note of the meeting I shall prepare the factual sections of my memorandum which again I would show you to check its accuracy. I will then add my conclusions and submit the full memorandum to the Committee. The Clerk will show you it and invite any comments you want to make about it. Any such comments will be
Mr Brian Binley 85
submitted to the Committee with my memorandum.
Thank you for coming in.
Interview concluded at 11.30am.
5 November 2009
36. Letter to Mr Brian Binley MP from the Commissioner, 11 November 2009
Thank you for passing to me the letter of 2 November from … the Financial Director of BCC Marketing Services Ltd, about the costs in relation to the letting of the company’s flat to you from 2006 to 2009. In my letter of 20 October I asked whether you received a benefit during the time that you rented a flat from the company. I have consulted the Registrar of Members’ Financial Interests about the further information provided by [the Financial Director].
[The Financial Director] argues that the capital value of the flat appreciated in each year and that therefore in no year did the company suffer an overall deficit. He argues from that that therefore you could not have received any benefit.
The Registrar takes the view that it is not necessary to show that the company suffered an overall loss for you to have received a benefit. It would, in her view, be possible for the company not to maximise its income from the property by charging less than a full market rate but nonetheless not actually to make a loss. She notes, in this context, that the tenant who took over from you paid more than 10 per cent more than you did, which suggests that, in the later stages of your tenancy at least, you may well have been paying less than the market would bear.
You have explained to me that the rent of £1500 a month was established as being a fair one by means of telephone calls to local estate agents. The lease, however, signed in February 2006, specifies that you would yourself pay “all charges for water, gas, television and electricity… together with the usual standing charge meter rents and companies’ hire charges… and all rentals and telecommunications charges… and register with the Local Authority as appropriate and pay the council tax or similar levy”. In the event, as the figures you have provided show, the company paid lighting and heat, council tax and water during your tenancy, amounting to a total of some £5,500. The annual value of this benefit would have amounted to more than 1 per cent of the annual parliamentary salary in each year of your tenancy, and on this basis the Registrar is of the opinion that it should have entered in the Register of Members’ Financial Interests.
I should be grateful for any comments you wish to make on this matter by 18 November. I hope then that it will be possible to conclude my inquiries and finalise the factual sections of my draft memorandum to the Committee.
I look forward to hearing from you.
11 November 2009
37. Letter to the Commissioner from Mr Brian Binley MP, 25 November 2009
Thank you for your letter of the 11th November, wherein you referred to your conversations with the Registrar on the question of received benefit pertaining to a rental of £1,500 per month, paid to my company, which included the cost of council tax, water rates, gas and electricity.
86 Mr Brian Binley
I recognise that it was a good deal and I equally recognise that the formal rental agreement does not include tax and utilities. However I find it difficult to understand how I gained a benefit personally, on the basis that the tax payer was paying the rental and of necessity would have had to pay the other costs had they not been included in the rental payment.
Therefore, it appears to me, that the taxpayer was the beneficiary and indeed that was recognised by the company who, I believe, didn't want to be seen to be extracting a charge from the public purse which could be construed as being profit making at the states expense.
Be that as it may. I'm not qualified to argue the point from a tax perspective or that of an accountant and consequently accept the Registrar's judgement and would wish to belatedly register what she considers to be the value [of the] benefit in kind.
You might therefore come back to me to tell me how I might do this, In conclusion can I thank you for your help in this matter.
25 November 2009
38. Letter to Mr Brian Binley MP from the Commissioner, 2 December 2009
Thank you for your letter of 25 November about whether you should have registered the rental benefit in respect of the rental of your company flat.
I was grateful for this letter, and note that you have accepted the Registrar’s judgement that the benefit arising from the rental levels which you were charged during your time in the flat should have been registered in the register of Members Financial Interests.
I am asking the Registrar to get in touch with you direct to agree with you a suitable entry under category 5 of the rules.
I will now prepare the factual sections of my Memorandum and let you see them in draft as soon as they are completed.
Thank you again for your help.
2 December 2009
Mr Brian Binley 87
Appendix 2: Letter from Mr Brian Binley to the Clerk of the Committee, enclosing a statement, 30 December 2009
Thank you for your letter received on the 24th December enclosing both the report of the Parliamentary Commissioner, together with the information that the committee will meet to consider the report on Wednesday 6th January at 9.30am.
You will know from our telephone conversation that I felt the time frame presented to me was restricting in the extreme, covering as it did the festive season and denying me the opportunity to seek professional advice as I had wished to do.
However, I have decided to rely on my own resources and use my own words, therefore I enclose a copy of a statement which I would ask be distributed to Members of the committee. Consequently I will not be seeking to delay the process by requesting a more convenient date.
I was however surprised to learn that whilst I can’t be present at the meeting on the 6th January when both Mr Lyons’ submission and my own will be considered by the Committee, Mr Lyon will be present.
The very fact that Mr Lyon comes to a judgement in his submission regarding my behaviour places him in the role of prosecutor. You will therefore hold a meeting at which the virtual prosecutor will be present but the prosecuted will be absent and that seems totally unjust from my perspective and could well impact upon my human rights. The answer would be to allow me to be present at the meeting and I request that you do so.
I am sure I have no need to tell you how important the outcome of this matter is to both my family and myself. We have been abused and vilified but, most importantly, my personal integrity and character have been brought into question and the sum total of much of my life in this respect will be assessed in my community on the basis of the decisions handed down. The matter is therefore extremely important to me and indeed the outcome of your deliberation could impact on my family and I more heavily than most matters tried in our Courts of Justice.
In conclusion can I again thank you for responding to my phone call on Christmas Eve and ask that you pass a copy of this letter on to the Chairman of the Committee for his perusal.
88 Mr Brian Binley
Brian Binley MP ______
Statement in response to the Draft Memorandum submitted by the Parliamentary Commissioner for Standards to the Committee for Standards and Privileges for their consideration on Wednesday 6th January 2010. ______
1. My Statement will concern itself solely with the Commissioners Conclusions detailed on pages 37 to 43 of the Draft Memorandum and will specifically respond to the most crucial statements made by the Commissioner in those conclusions.
2. Page 38. Paragraph 121:- Commissioners statement
“Mr Binley was in my judgement imprudent to rely solely on this conversation when he entered into this leasing arrangement for the flat 3 months later”
My Response i) I had first put this matter to the Department of Resources in August 2005 and followed that initial call with two further phone calls before 22nd November 2005 and on each occasion I was consistently told that the arrangements proposed fell within the rules.
ii) The Department asked me to put the details in writing which I duly did on the 22nd November 2005.
iii) I hadn’t received a response by early December and called again because the company was due to complete the purchase during that month. I was again specifically told that the arrangement was within the rules. I therefore advised the company of that response and they proceeded to complete the purchase of the flat.
iv) I finally received a response to my letter, some four months after I sent it, on the 23rd March 2006, just 5 weeks after I had moved in telling me that the rules were to be changed in such a way as to exclude the arrangement. I was both shocked and angry.
v) Fortunately the Department, in a letter dated the 31st October 2008 stated “that the current arrangement was within the rules at the time it was entered into” However that was the first written confirmation I had received.
Mr Brian Binley 89
vi) The Commissioner also accepted (Paragraph 122. Lines 18-20) that the current arrangement was within the rules at the time it was entered into.
vii) In the light of the slowness of response from the Department I find it difficult to understand how I could have been more prudent. Incidentally I was later to learn the length of time it took the Department to reply was not unusual
Page 3 paragraph 123: - Commissioners statement.
“It is not clear why it took him two months before, on his evidence, he wrote to the Department about the ruling.”
My Response: -
i) The workload of a new Member is the heaviest I have ever experienced in a new job and was the major reason for my delayed response.
ii) The letter said that the new edition of the Green Book would be published in the late spring (In fact it was published in July 06) and it might have been in my mind initially to await publication
iii) The Commissioner used the phrase “on his evidence” as though I was the only authority in support of the claim yet the Assistant Director of Operations, in his letter of the 5th June, thanks me “for my letter dated 25th May”
Page 39. Paragraph 124 – Commissioners Statement
“allowed Mr Binley enough time to take any appeal to the Speaker “
Page 39. Paragraph 125 – Commissioners Statement
“There is no evidence that Mr Binley took any significant action on this decision by the Department, until he raised it again with them some 20 months later”
Page 39. Paragraph 126 – Commissioners Statement
“I consider it unacceptable that Mr Binley should have taken no significant action to respond to the Departments decision of June 06 until February 2008.
90 Mr Brian Binley
My Response:-
i) Herein lies the sequence wherein the Commissioner arrives at his most damning conclusion detailed on page 41. Paragraph 131 to the effect that I was personally responsibility for breaching the rules from March 2007 to April 2009. If arguments can be made to challenge the general thrust of this sequence of statements than the Commissioners major conclusion becomes highly questionable.
ii) The initial statement is a subjective assumptive devoid of supporting evidence. However both actual and circumstantial evidence exists to support a contrary view which I shall detail below.
The initial statement leads directly to the Commissioners second and more severe assumption which is equally devoid of supporting evidence which leads to the third even harsher statement. Each of those statements leads directly to the Commissioners prime conclusion in page 41 Paragraph 131 which is so damning and harmful from my perspective. The sequence is built one upon the other, like stones in a column, and if one is proven to be weak the structure itself is unsustainable In other words if the available evidence suggests that meaningful ongoing discussions continued with the Department then the Commissioners case is placed in grave doubt.
iii)I first refer to my own evidence given to the Commissioner during my interview with him on the 5th November 2009, a record of which is listed as number 70 in the bundle if evidence received by him, wherein I consistently maintained that discussions has been ongoing during the whole of the period in question
Page 71. Line 3 Commissioner “You took no action till February 2008”
Line 4 BB’s Response “There were a number of discussions with the Department. As I said to you in my letter of the 10th July much of the transactions were done either verbally, at meetings or on the telephone…”
Page 74. Line 6 – Commissioner “But the Department wrote on the 5th July 06 giving you determination. They agreed to allow you to March 07 to make alternative arrangements”
Line 8 BB’s Response
“I was still arguing against that decision”
Mr Brian Binley 91
Page 74. Line 26 Commissioner “It was still 2½ years”
Line 27 BB’s Response “There were conversations but no record”
NB. The Period from the date initially set by the Department as the date they would conclude payment of rent was March 2007 and the Commissioners own statement during our interview of the 5th November 2009 on page 71 said “you took no action until February 2008 when you again challenged the ruling”. Thereafter the Commissioner said on page 18 lines 25 – 26, “The Director also enclosed an internal memo from himself following his March 2008 meeting with Mr Binley” confirms that even by the Commissioners own reckoning the longest period that no significant action took place was not the 20 months the Commissioner quotes in his conclusion on page 39. Paragraph 125 .Line 9 but was no more than 10 months from March 07 to February 08. However, I maintain, and I believe circumstantial evidence suggests, that important conversations were ongoing during the whole of that time although there is no actual record to prove whether I or the Commissioner is correct. The major point however is that the Commissioner’s estimate of the period of inactivity varies widely within his own submission and proves yet again the unreliability of those submissions.
Page 75. Line 14 – Commissioner
“Why did you think it acceptable to ignore the Departments ruling for that period of time and take no action formally to tell them why you were continuing to claim beyond March 2007, did you take their silence as assent?”
Line 17 BB’s response “we were having conversations although I can’t prove this now”
Page 76. Line 4 – Commissioner “let me move now to February 2008. Who initiated contact in February last year?”
Line 6 BB’s response “Well there were conversations going on”
In other words I made it clear throughout the whole interview that discussions were ongoing during the period the Commissioner states I took no significant action.
iv) The Director of Operations’ letter of the 31st October 2008
92 Mr Brian Binley
Page 52 – Line 6 “We have had a number of discussions about reimbursement of your housing costs through the Additional Cost Allowance” also supports the view that important discussions were ongoing during the time in question.
v) Director of Operations letter 31st October 2008 Page 53, line 35 “In our discussions you made the following points” equally underlines that point and even details the major discussion items which had been ongoing from the start of the appeal process.
vi) Director of Operations letter 31st October 2008 Page 53, line 5 “ I fully accept that you have acted properly at all times in this matter” not only infers that the matter was ongoing but also confirms that my claims for rent during this period were considered by the Department to be proper.
vii) The Commissioner continually refers to the fact that there is no record of conversations between June 06 and February 08 whilst I maintain they were ongoing. However a letter to a colleague from the Department dated 17th November 2009 makes it clear why this is the case.
The relevant paragraph reads:- “I can confirm that no such record is held by the Department. However, it is also the case that only a minority of calls are documented on our logging system, mainly those which sought substantive advice. Whilst I would have expected, therefore the addressee’s enquiries to be reflected in a record of some sort, I cannot rule out that it simply was not recorded by staff at the time”
viii) It should also be noted that further to my discussions with the Department during this time I was also pursuing the matter through the 1922 Executive Committee, a fact which I mentioned to the Commissioner during our interview (see page 76 – line 17) and indeed I saw both processes as part of the same appeal. I found it surprising that the Commissioner failed to mention that fact in his conclusions, not least because my proposal, which was endorsed by the 22 Executive, and submitted to the body responsible for formulating the Green Book published in March 2009, was accepted and as a result the Green Book now includes the following general principle
Mr Brian Binley 93
“ As a general principle, major changes impacting upon any issue which might require Members to enter into any long term arrangements or materially affecting the guidance or rulings contained in this documents, should be designed to last for the lifetime of a Parliament and not changed mid-term.
I seemed odd to me that the Commissioner did not see this as a vindicating factor regarding this matter not least because my appeal could well have impacted upon the acceptance of this general principle. Indeed if the Department had objected it is unlikely that the principle would have been included in the Green Book.
Paragraph 128 Line 5 – Commissioner
“But I consider that the primary responsibility rests with Mr Binley”
Paragraph 132 Line 9-12 – Commissioner
“The Speakers introduction in the Green Book makes it clear that the Members Estimates Committee, chaired by the Speaker, had given the Department of Finance and Administration (Now Department of Resources) authority to interpret and enforce the Green Book Rules.
My response –
i) Herein lies the second major issue. Where does responsibility for continuing to pay claimed rent during the period in question rest? There is no doubt that the two statements above run counter to each other in this respect but who has predominance.
ii) It is true that the Green Book places sizeable responsibility on the Member “to ensure your arrangements for your ACA claims are above reproach and that there are no grounds for a suggestion of misuse of public money”. The fact that I sought the advice of the Department and was in communication with them is fully attested to throughout the whole process and it is clear that the Department was fully aware of my situation throughout the whole period under review. No greater testament can be made in this respect than the comment made by the Director of Operations in his letter to me dated 31st October 2008 when he wrote that he “ fully accepted that you have acted properly at all times in this matter”
iii) It is true that my appeal extended beyond the initial date set by the Department for closure but it is equally true that the Department recognised this fully, not only by paying me after March 07 but also by readily agreeing
94 Mr Brian Binley
to further extensions on the time frame to March 09 and thereafter April 09. Under their responsibility to “interpret and enforce the rules” they had every power and a duty not to accede to my regular applications at anytime they thought appropriate but they chose not to do so. That can only be construed as giving assent and agreeing that I was “acting properly” and the word ‘enforce’ implies the Department had predominance.
iv) The foreword in the Green Book, which by its very presence must be considered pre eminent, highlighting as it does certain specific issues selects the need for Members to seek the advice of the Department on important matters as one of those issues and the Commissioner accepted that I had followed that advice fully as did the Director of Operations. The second matter which is given pre eminence refers to the Departments responsibility to interpret and enforce the rules as outlined above suggesting that if a Member fails to seek advice and makes an illegal claim the Department has a duty to enforce the rules and reject the claim.
Equally if a Member does seek advice which he thereafter rejects by claiming illegally then the Department has an equal duty to enforce the rules and reject the claim.
But if a Member seeks advice and fully informs the Department of his actions and the Department continues to meet his claims then the Member must surely have every right to believe that his claims have been endorsed by the Department and their assent to the claim has been given. This must especially be so given the fact that both responsibilities are given pre- eminence in the forward written by the Speaker himself.
If the Department, makes its decision on a claim on the basis of its knowledge, then by the very nature of the order of the process the Department must be considered predominant.
As a new Member, I especially considered the Department to be the overriding authority in this respect and never acted in a manner which failed to recognise their authority. I therefore continued to claim because discussions were ongoing with the Department during the whole of that time and the Department was fully aware and informed of the situation.
Finally, had the Department “enforced” non-payment of my claims at any time I would have seen that action as emanating from the responsible “authority” and acted upon it immediately? However at no time was it ever suggested or even hinted to me that I should not claim or that I was acting improperly by so claiming as the Commissioner now states that I was.
Mr Brian Binley 95
Conclusions i) I was bitterly disappointed with the quality of the Commissioner’s Report, not least with regard to the way he arrived at his major conclusion, to the effect that I took no significant action following the original decision made by the Department to pay my rent claims until March 2007, until I raised the matter again some 20 months later. ii) Putting aside the fact that the period the Commissioner regularly quotes for my inaction varies sizeably throughout his conclusions, he consistently states that “there is no evidence” that I took action even though I quoted both circumstantial and direct evidence to the contrary , culminating in the Director if Operations statement contained in his letter to me, dated 31st October 2009 that “I fully accept that you have acted properly at all times in respect of this matter” Yet the Commissioner fails to highlight one piece of evidence in support of his contention. iii) In other words his conclusion is built on a conviction which itself follows an assumption and that simply is not good enough bearing in mind that my integrity and good character have been so seriously questioned in my local community and beyond. iv) Further serious doubt is cast upon the Commissioner findings as a result of the paragraph in the letter from the Department to a colleague on the 17th November 2009 (denoted on page 5, paragraph vii of this submission to the effect that “ only a minority of calls are documented on our logging system” I recognise that the Commissioner was not aware of that letter when he formulated his conclusions, but at the very least, he should have made enquiries of a similar nature with the Department before arriving at his judgement. v) To simply assume that the Department was recording every conversation or transaction is unacceptable bearing in mind its relevance to my claims. To learn that the Department itself publicly admits to that important shortcoming must cast sizeable doubt on the Commissioners central conclusion. The Committee may well think this to be especially worthy of serious consideration bearing in mind that would weigh heavily in any court in the land. vi) The Second major conclusion made by the Commissioner rests on the contention that primary responsibility for paying rent during the period the Commissioner erroneously concludes I was inactive “rests with Mr Binley”. Such a conclusion flies directly in the face of the edict from the Members Estimates Committee, chaired by the Speaker, to the effect that the Department has a direct responsibility to enforce the rules.
96 Mr Brian Binley
The word ‘enforce’ is a very strong word indeed and carries with it a serious degree of responsibility especially when the Department is fully aware of, and conversant with, all of the circumstances surrounding a given issue as they were in this case.
For the Commissioner to almost dismiss that duty with a rather mild statement to the effect that the Department “must bear some responsibility” shows a woeful lack of willingness to fully interpret the meaning of the word of the edict of the M.E.C. Furthermore it may be true that the Department also didn’t consider their role as deeply as they should, but that is the responsibility of the House Authorities and not new Members struggling to come to terms with a complicated and often contradictory set of rules.
vii) I am grateful, however, for the Commissioner’s finding that neither I nor the company in which I have an interest misdirected public money to our benefit and that “there is no evidence that the public purse lost out”. Indeed the cost to the public purse would have continued whether I had fought this battle or not and the evidence suggests that it cost the taxpayer less than if I had rented another property during that time. The evidence also underlines the fact that the company kept its rental low because it did not want to be seen to be benefiting from the taxpayer.
viii) Furthermore, I was myself acutely aware of the need to treat the spending of Taxpayers money with extreme care from the time I was elected as attested to by the fact that my overall expense claims always place me in the lower part of the annual list of M.Ps expenses.
ix) The evidence, therefore, totally refutes any implication that the original arrangement, vis-a-vis the flat or indeed the time taken to pursue the appeal, was motivated by personal gain but to the contrary underlines continually that I acted honestly and in good faith.
x) It is ironic however that my family and I should have suffered the abuse, vilification and personal stress this complaint has motivated when the reason for appealing the original rule change was to fight what I, and eventually the House, considered to be an injustice implicit in a mid-term change which impacted adversely on Members long term contractual arrangements.
xi) I am immensely proud of the fact that existing and future Members of Parliament will benefit from this important new principle which was included in the March 2009 Green Book. The irony however is that the fight to bring about this change has already cost my family and I dearly.
Finally I am even more comforted by the fact that I acted in good faith throughout the whole matter, dealing honestly and openly with the Department at all times and therein lies my defence.
Mr Brian Binley 97
Formal minutes
Wednesday 6 January 2010
Members present:
Sir Malcolm Rifkind, in the Chair
Mr Andrew Dismore Mr Chris Mullin Nick Harvey The Hon Nicholas Soames Mr Greg Knight Dr Alan Whitehead Mr Elfyn Llwyd
Draft Report (Mr Brian Binley), proposed by the Chairman, brought up and read.
Ordered, That the Chairman’s draft Report be read a second time, paragraph by paragraph.
Paragraphs 1 to 3 read and agreed to.
Paragraph 4 read, amended and agreed to.
Paragraphs 5 to 18 read and agreed to.
Paragraph 19 read, amended and agreed to.
Paragraphs 20 to 24 read and agreed to.
Paragraph 25 read, amended and agreed to.
Paragraphs 26 to 34 read and agreed to.
Paragraph 35 read, amended and agreed to.
Two papers were appended to the Report.
Resolved, That the Report, as amended, be the Fifth Report of the Committee to the House.
Ordered, That the Chairman make the Report to the House.
[Adjourned till Tuesday 19 January at 9.30 am