The Times: Osborne to be investigated by sleaze watchdog over #mpsexpenses

by Stephen Tall on July 2, 2009

Here are the allegations, as summarised in a Lib Dem press release issued this afternoon:

George Osborne used his second homes allowance on a London property and then switched it to a large farmhouse in his Cheshire constituency of Tatton. He bought the Cheshire residence ten months before he won his Tatton seat in 2001. Instead of taking out a mortgage on the farmhouse he increased the mortgage on the London property which he bought for £700,000 in 1998.

He designated the London house his second home, even though it was his main residence, so he could claim mortgage interest payments. Two years later he took out a separate £450,000 mortgage on the farmhouse, made that formally his second home, and has since claimed £100,000 on it. It is claimed that Mr Osborne was able to reduce the mortgage on his London home to less than £200,000 before he sold it for £1.48million in 2006, making a £748,000 profit. He did not pay capital gains because he had declared it his main home since 1998 with the tax authorities – despite the two years it was formally designated as his second home with Commons officials.

The Liberal Democrats have calculated that if Mr Osborne had paid tax for those two years, he would have been liable for £54,948. David Cameron has banned his MPs from flipping their homes and avoiding paying capital gains tax.

Here’s the story in The Times:

George Osborne, the Shadow Chancellor, is to be investigated by a sleaze watchdog after revelations in The Times over his second-home allowance claims. … [John Lyon, the Parliamentary Commissioner for Standards] is to look into a complaint about Mr Osborne’s claims for a second-home allowance after it emerged that he had taken out a mortgage on his constituency home that was nearly £5,000 more than its purchase price.

… Mr Lyon said he would look into a claim that “Mr Osborne claimed for mortgage payments that were not necessarily incurred, contrary to the rules of the House”.

“Since your complaint involves allegations relating to events of over seven years ago, I have consulted the House of Commons Committee on Standards and Privileges and they have agreed to me initiating an inquiry into this part of your complaint.” He said that he put the claims to Mr Osborne, adding: “When I have received his response, I will consider best how to proceed.”

And here’s what Lib Dem Treasury sokesman Lord (Matthew) Oakeshott has to say about the allegations:

George Osborne should know that you can’t tell the taxman one story and the fees office another. We asked him to come clean and pay the taxpayer back weeks ago but he did nothing.

“This is a real test of David Cameron’s leadership – he needs to make his Shadow Chancellor pay back the tax he’s dodged. It looks like Cameron has either got one rule for the Notting Hill set and another for the knights of the shires, or that George Osborne is simply too close to chop.”

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Before you get too excited about Osborne,can you please confirm:

1)What action the Lib Dems have taken against Lord Rennard and whether or not the £41,000 he claimed for a second home has been reimbursed to the taxpayer?

2) When can the innocent individuals who were swindled by your now jailed donor expect to get their £2 million reimbursed?

by john zims on July 2, 2009 at 8:17 pm. Reply #

Can we also ask why Osborne is maxing out the petty cash allowance £250 per month and what he is spending it on.

http://mpsallowances.parliament.uk/mpslordsandoffices/hocallowances/allowances-by-mp/george-osborne/George_Osborne_0708_IEP.pdf

Pages 121, 196, 244 (£1000 in one go), 309 (£500)…

Also p254 – employing a whole Conservative Association as a secretary. Might be legit.

p404 charging legal fees – for unspecified purpose – to the staffing allowance. Might be legit.

by Joe Otten on July 2, 2009 at 8:21 pm. Reply #

John, sorry mate, but we spent it.

by Joe Otten on July 2, 2009 at 8:23 pm. Reply #

@ John Zims

1) Forced to step down (unlike Osborne, Gove or Lansley, the “front bench flippers”)
2) Money received within the rules and in good faith, so there is no case for giving it back. Anyway, as Joe Otten says, it has already been spent, on legitimate party expenses, not for personal gain, unlike Osborne’s money.
3) On the subject of party funding, when are the Tories going to come clean about Lord Ashcroft and also back an end to this current corrupt system where the rich simply buy votes through massive donations? Never, I suspect. How sleazy of them.

by Robert C on July 3, 2009 at 12:49 pm. Reply #

@John Zims

If you sold a your house to someone you thought was legitimate but who turned out later to be a crook, would you give the money back to the people he swindled and bankrupt yourself in the process? I don’t think so.

However, if you continually take money from a person who is so evasive he won’t even say where he resides for tax purposes (despite clear rules forbidding overseas donations) like the Tories do at present, I would say that is pretty dodgy.

by Robert C on July 3, 2009 at 12:58 pm. Reply #

@John Zims

Should George Osborn become Chancellor of the Exchequer would he tell the taxpaying public “Do as I do”?

by Stanley Theed on July 3, 2009 at 8:32 pm. Reply #

Interesting to see that a Conservative peer, Lord Hanningfield, has apparently been investigated by the police over his claims for overnight subsistence allowance “despite living less than 40 miles from Westminster” – allegedly at the instigation of the Lib Dem MP for Colchester, Bob Russell:
http://news.scotsman.com/uk/39Vendetta39-sparks-expenses-probe.5429080.jp

One can only wonder what Bob Russell – not to mention Lord Oakeshott – and especially not to mention the police! – thinks of the Rennard affair!

by Herbert Brown on July 5, 2009 at 12:16 am. Reply #

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