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Minister faces flat sale pressure Expenses system 'wrong' - Blears
(about 1 hour later)
Communities Secretary Hazel Blears is facing pressure after confirming she did not pay capital gains tax on profit from the sale of a London flat. Cabinet minister Hazel Blears says she understands why people "hate" MPs' expenses as she faces pressure over the sale of her "second home".
The property was registered as her main residence with the Inland Revenue, while at the same time she claimed MPs' second home expenses on the same flat. She sold the flat for a £45,000 profit but did not pay capital gains tax as it was registered as her main home with the Inland Revenue.
Ms Blears said she had complied with Commons and tax rules. She said she had not broken any rules but said the system was "wrong".
Former Archbishop of Canterbury Lord Carey has said Parliament's moral authority has hit its "lowest ebb".
Ms Blears claims were published in the Sunday Telegraph - as the newspaper group continues its daily revelations of claims made by MPs under their controversial second home allowance.
Moles removed
It has concentrated on claims by Labour ministers so far - although it also reports that the Conservative former minister John Gummer claimed public money to have moles removed from his country estate.
The Sunday Telegraph also reports second home claims by Sinn Fein MPs, who do not take their Commons seats.The Sunday Telegraph also reports second home claims by Sinn Fein MPs, who do not take their Commons seats.
Speaking outside her house in Salford on Sunday she said: " I understand entirely why the public hates this. I understand entirely why the public hates this. The system is wrong. Hazel Blears class="" href="/1/hi/uk/8042214.stm">MPs' prestige at low ebb - Carey class="" href="/1/hi/uk_politics/8039273.stm">MPs' expense claims - key details class="" href="/1/hi/uk_politics/7840678.stm">Q&A: The MP expenses row
"The system is wrong, it needs to be changed." The newspaper has already reported that Ms Blears changed the property she designated as her "second home" twice in a year - between a home in her Salford constituency and two London flats.
She said she would favour getting a "group of ordinary people" together with the independent body, to work out a fair system to which that all MPs would have to adhere. On Sunday, the newspaper reported she had claimed a flat in south London was her "second home" - for which she could claim expenses - and claimed £850 a month towards mortgage payments.
"We've got to get it sorted out as quickly as possible," she added. But when she sold it for a £45,000 profit four months later, she did not pay the 40% capital gains tax charged on the sale of second homes - as it was registered with tax officials as her main residence.
There are those MPs who, despite their good intentions, have fallen victim to an overly complex expenses system that has served to portray their actions in an unflattering light Sunday Telegraph MPs' expense claims - key details Q&A: The MP expenses row
Ms Blears sold her south London flat in August 2004, making a £45,000 profit, when it would have been registered with tax authorities as her main residence.
But four months earlier, she had declared to Commons authorities that the same flat was her second home, and started claiming expenses of £850 a month for the mortgage.
A spokesman for Ms Blears earlier said: "Hazel has complied with the rules of the House authorities and [HM Revenue & Customs]. No liability for capital gains tax arose on the sale of her flat in Kennington."
Capital gains tax is charged at 40% on profit from the sale of a properties not regarded by the taxman as a main residence.
A spokeswoman said HM Revenue & Customs (HMRC) could not comment on individual taxpayers' affairs.
Sinn Fein claimsSinn Fein claims
Ms Blears has denied any wrongdoing and said she complied with the rules. But questioned outside her Salford home on Sunday, she added: "I understand entirely why the public hates this. Right, the system is wrong. It needs to be changed."
Conservative defence spokesman Liam Fox told the BBC ministers used to have to claim their main home was in London - but that had been changed under Labour. "It seems to me there has to be hard and fast rules about what is your primary home," he said.
The public think the rules are wrong and ... go way beyond the legitimate needs of people who have to be in London to represent their constituents Liam FoxConservatives
He said he was not concerned about Conservative expenses claims - due to be published next week - and MPs would have to answer for themselves.
"The trouble is that politicians have tended to say 'well, we are only acting within the rules'," he said.
"But the public think the rules are wrong and ... go way beyond the legitimate needs of people who have to be in London to represent their constituents."
The Sunday Telegraph reports that five Sinn Fein MPs have claimed a total of almost £500,000 in second home expenses - despite the party not taking up its Commons seats.The Sunday Telegraph reports that five Sinn Fein MPs have claimed a total of almost £500,000 in second home expenses - despite the party not taking up its Commons seats.
'Do not profit'
A Sinn Fein spokesman denied that the MPs, including president Gerry Adams and Northern Ireland deputy first minister Martin McGuinness, had done anything wrong.A Sinn Fein spokesman denied that the MPs, including president Gerry Adams and Northern Ireland deputy first minister Martin McGuinness, had done anything wrong.
"It is widely known that Sinn Fein MPs travel regularly to London on parliamentary business and utilise the accommodation that we rent when there," he said."It is widely known that Sinn Fein MPs travel regularly to London on parliamentary business and utilise the accommodation that we rent when there," he said.
"We do not purchase properties at public expense and therefore do not profit from the expenses claimed as of right.""We do not purchase properties at public expense and therefore do not profit from the expenses claimed as of right."
The Telegraph has published details of expenses claims by the prime minister, government ministers, other Labour MPs and a prominent Conservative MP in recent days.
Further reports about MPs from other parties are expected in coming days.
'No impropriety'
Work and pensions minister Kitty Ussher received more than £22,000 over a 12-month period towards improvements to her home, the paper reported.
A spokesman said the claims hade been in line with Commons rules and approved by the fees office.
Mr Brown says the expenses system does not work and must be changedMr Brown says the expenses system does not work and must be changed
"[Ms Ussher] fully supports the committee on standards in public life's review into creating a better system for MPs' expenses that the prime minister has asked for, and believes it is right that MPs' expenses claims should be published," he said. Other MPs' claims revealed in the Sunday Telegraph include former PM Tony Blair, former Transport Secretary Stephen Byers, former Home Secretary John Reid and junior ministers Kevin Brennan and Kitty Ussher.
The Sunday Telegraph has clarified an earlier report about a £6,577 claim made by Gordon Brown to reimburse his brother for payments to a cleaner that the men shared. Work and pensions minister Ms Ussher reportedly received more than £22,000 over a 12-month period towards improvements to her home and asked whether she could claim to have "Artex coverings" removed from the ceiling.
A leader article said: "There are those MPs who, despite their good intentions, have none the less fallen victim to an overly complex expenses system that has served to portray their actions in an unflattering light. A spokesman said the claims had been in line with Commons rules and approved by the fees office and Ms Ussher supported the independent inquiry into "creating a better system for MPs' expenses", due to report back by the end of the year.
"For example, the receipts submitted by Gordon Brown for the cost of a cleaner, shared with his brother Andrew, fall into such a category. Poll ratings
"There has never been any suggestion of any impropriety on the part of the prime minister or his brother." The Sunday Telegraph has clarified an earlier report about a £6,577 claim made by Gordon Brown to reimburse his brother for payments to a shared cleaner - saying there was no suggestion "of any impropriety".
The question you have to ask is who devised the system? MPs devised the system under their self-regulating arrangements Sir Alistair Graham, ex-chairman, committee for standards in public life Full details of all MPs' claims were due to be published in July after a Freedom of Information battle - but the Telegraph has revealed the information early. The Commons has asked police to investigate the leak .
Full details of all MPs' expenses dating back four years, running to 2.4 million receipts, were due to be published in the middle of July after the Commons authorities lost a Freedom of Information battle. Meanwhile a survey of 2,246 people, by BPIX for the Mail on Sunday, suggests Labour's ratings have slumped to just 23% - lower than when Michael Foot was party leader in the 1980s.
But the Telegraph is revealing the information early.
The Commons authorities have complained to the Metropolitan Police, who confirmed they were considering a request for an investigation into the leak to the paper.
Former chairman of the committee for standards in public life, Sir Alistair Graham, said the expenses system had to be decided in the public and taxpayers' interest, by an independent outside body.
"It is depressing to keep hearing [MPs] saying, 'Well, it's the system that was wrong and we are changing the system.'
"The question you have to ask is who devised the system? MPs devised the system under their self-regulating arrangements and that's what must change for the future."
Former sports minister Kate Hoey said that if MPs were found to have "changed homes deliberately in order to be able to capitalise on selling a flat and then moving on and getting another one, I hope that their consciences would say that they maybe should pay money back".
An ICM poll of 508 adults for the News of the World found that more than two-thirds of respondents said they believed the expenses revelations had damaged the prime minister.
Some 89% believed the reputation of Parliament had been tarnished, and 91% said they wanted expenses records to be published in full straight away.
Labour's poll ratings have slumped to just 23% - lower than when Michael Foot was party leader in the 1980s - according to a survey of 2,246 people by BPIX for the Mail on Sunday.
A YouGov poll of 2,209 voters for the Sunday Times suggested Labour's support had dropped by seven percentage points to 27% - 16 points behind the Conservatives.A YouGov poll of 2,209 voters for the Sunday Times suggested Labour's support had dropped by seven percentage points to 27% - 16 points behind the Conservatives.
Energy Secretary Ed Miliband told the BBC having a bad week was "part of being in politics" and said Gordon Brown was the right man to lead Labour through the next general election.
But he said the focus on expenses was "profoundly depressing" and said the system had to change.