‘Winding down’ payments for MPs who lose their seat at next election to be doubled
MPs who lose their seat at the next general election will receive double the financial support following a ruling from parliament’s expenses watchdog.
MPs who suffer an election defeat have previously been entitled to two months of financial assistance to help close their office and manage the departure of staff.
But the Independent Parliamentary Standards Authority (IPSA), which governs MPs’ pay and expenses, has ruled this should be increased to four months.
The so-called winding-down payments will now also be made available to those who choose to stand down at the next election.
However, payments will not be given to MPs who step aside outside the election period, such as former prime minister Boris Johnson, who stood down in June.
The rule change means the winding-up payment will be paid to all MPs who leave parliament at the next election – whether they lose their seat, stand unsuccessfully in a new or different seat or stand down.
As of April this year, MPs are paid an annual salary of £86,584.
IPSA’s ruling comes following the confirmation of 75 current MPs that they will not be standing at the next election – including 50 who were elected as Conservatives.
For Labour, 14 MPs are stepping down, while seven from the SNP will not seek re-election.
IPSA, which is an independent body, said it made the decision because the time to fully close down an MP’s parliamentary and financial affairs was longer than the time covered.
“Former MPs will continue to have access to their normal budgets [pro-rated] for that four-month period, and they will continue to employ staff as needed to assist them in winding up their affairs,” the ruling said.
As well as winding down payments, MPs who have served more than two years are also eligible for loss-of-office payments, with longer-serving MPs receiving larger amounts.
Bob Seely, the MP for the Isle of Wight, criticised the move.
“I don’t think people resigning should be getting a payout,” he told TalkTV.
“But this is an independent body, I’m afraid to say we don’t get to vote on it unless somebody tells us that we do, and frankly, I am more concerned about dealing with my constituency casework.
“So I’m not particularly happy about this either because it just shows us in a bad light and despite the fact it’s an independent body, everyone is going to blame us for it.
“It really winds me up, frankly.”
John O’Connell, chief executive of the TaxPayers’ Alliance, echoed his concerns, saying: “Doubling golden goodbyes for MPs is a kick in the teeth for taxpayers.”
He added: “Hard-pressed Brits are already funding generous salaries, perks and pensions for elected officials.
“IPSA should be mindful of that when recommending more taxpayers’ money for politicians.”
A report by parliament’s Commons Administration Committee in February found that Westminster’s payouts to MPs compared poorly with comparable international democracies.
The median loss-of-office payment for MPs who were defeated in the 2019 general election was £5,250 – equivalent to less than one month of their then £84,144 salary – with the amount paid depending on the length of service.
By comparison, an ousted MP in Germany who has served for 18 years qualifies for £162,360 compensation, while outgoing Australian MPs can expect to receive either £31,455 or £62,909, depending on length of service.
The payments, similar to redundancy packages, will be available to all eligible MPs who leave parliament at the next election.
Separately, severance payments for outgoing prime ministers have been criticised recently after Liz Truss received £18,660 despite serving in office for just 49 days.
Her chancellor, Kwasi Kwarteng, received £16,876 after he was forced to resign following his mini-budget, which caused turmoil in the financial markets.