Skip to the content

12 December 2013: IPSA publishes final report on MPs’ pay and pensions

The Independent Parliamentary Standards Authority today published its decisions on reforming MPs’ pay and pensions.

IPSA has set out a package of reform with the following elements:

  • A one-off uplift in salary to £74,000 in 2015, an increase of 9.26%, to address the historic shortfall. Thereafter, MPs’ pay will be linked to average earnings – if they go up, so will MPs’. If they don’t, neither will MPs’.
  • A new pension on a par with those in other parts of the public service, saving the taxpayer millions. Following public consultation on our proposals from earlier this year, we have decided to increase MPs’ pension contributions further, reducing the cost to the taxpayer even further.
  • Scrapping out-of-touch “resettlement payments” worth tens of thousands of pound per MP. These will be replaced with more modest loss-of-office payments, which will be available only to those who contest their seat and lose.
  • A tighter regime of business costs and expenses, including ending the provision for evening meals.

Taken together, this package of reform is cost neutral.

IPSA is obliged by statute to review its determination on MPs’ pay in the first year of each Parliament, and will review the decisions on MPs’ pay following the 2015 election before implementing them. 

IPSA also continue to develop the idea of MPs providing an account of their activities throughout the year.

IPSA’s chair, Sir Ian Kennedy, said the reforms would set MPs’ pay on a sustainable footing for a generation when implemented after 2015 general election. 

For the first time, MPs’ pay and pensions will be set independently, and away from political deals cooked up in Westminster. We are sweeping away the out-of-date and overly generous benefits, and introducing a one-off uplift in pay. Crucially, thereafter MPs’ pay will be linked to everyone elses'.

We have designed these reforms so they do not cost the taxpayer a penny more. When taken with the tens of millions we have saved by reforming the business cost and expenses regime, we have saved the taxpayer over £35 million with the changes we have introduced since 2010.