Parliament's new standards watchdog will offer a set of options for reform of MPs' expenses when it launches a public consultation, its chairman Sir Ian Kennedy has revealed.
The news raises the possibility that the recommendations of last year's Kelly report - which proposed an end to taxpayer-funded mortgages and a ban on the employment of MPs' relatives - may not be implemented in full by Sir Ian's Independent Parliamentary Standards Authority.
Sir Ian described the recommendations from Sir Christopher Kelly's Committee on Standards in Public Life (CSPL) as the "foundation" of the new authority's work, but made clear he would not allow Ipsa's hands to be tied.
He also acknowledged that there was a "tension" created by the fact that Ipsa's budget is determined by Parliament, which it is responsible for regulating. He indicated that he would not take a confrontational line with the MPs who hold Ipsa's purse-strings, saying: I don't define `independence' as poking my finger in the eye of Government or Parliament just to show them what's what."
Sir Ian was appointed in November a day ahead of the Kelly Report to oversee the introduction and operation of a reformed expense system for the House of Commons, after the exposure of widespread abuse of the old system. Ipsa will be the first external and independent body in history to govern MPs' expenses.
Despite indications from the leaders of the main parties that Kelly should be implemented in full, Ipsa has drawn up its own proposals for change, which will go out for consultation on Thursday with the aim of putting a new system in place in time for the general election.
Speaking to the Hansard Society, Sir Ian refused to go into the details of Ipsa's proposals but he said: "We are an independent body. We respect gratefully what Kelly has produced. We are building a scheme around Kelly, but we have to make our own way and we have to win the confidence of everybody that we are making our own way."
Ipsa's proposals will be based on "expenses backed by receipts" and not allowances to which MPs are deemed to be entitled. The system will be divided into five categories: Travel and subsistence; accommodation; staff; rental of constituency offices; and general running costs, such as office equipment.
"As regards each of those categories, we have begun from the position taken by the CSPL and worked through ways of translating recommendations into action," he said. We will offer, on a number of occasions, different options for consideration."
Sir Ian described MPs' abuse of the old system as "appalling" and said he hoped Ipsa would oversee a system which would win back public confidence and ensure MPs are properly supported for the work they do.