Paul Rowen and the anatomy of a Lib Dem expenses scam
Ed Howker 11:53am
Now the Lib Dems are riding high in the polls, they attract greater scrutiny –
which, to put it mildly, they do not always stand up to. In this week’s Spectator, we look at what can be seen as the Lib Dem vice. They may not charge for duck houses, or mortgages. But they
do specialise in taking money intended for MPs expenses, and finding “innovative” ways of putting it into their war chest. Here is a hard example that may interest CoffeeHousers and it
stars Paul Rowen, whom Mr Clegg visited last week – and declared “has done a great job”. He certainly has: for filling the Lib Dem political machine with cash. These documents
were not designed to break the rules – just push them as far as possible, but it’s hardly the behaviour of the “most honest,” as Clegg has styled himself.
The Lib Dem modus operandi is explained in a leaked document which we at the The Spectator have got our hands on, and which is reported in today's Mail. It reveals a disgraceful policy to minimise the costs of party political campaigning and burden the taxpayer with as much as possible. Hilary Stephenson, the Lib Dem election campaign director appointed by Mr Clegg, put her name to this remarkable March 2008 presentation to MPs advising them on how to squeeze every last drop from their allowances, pointing out that "planning will mean that this £125,000 of resource will be used to best effect".
The game, Lib Dem MPs are told, is to exploit these "grey areas" in the Parliamentary expenses regime. It suggests that Liberal Democrat MPs look carefully at the “divide between party political campaigning and MP campaigning”. The “meaning of ‘proportionate and discreet’ use of the logo”, the “ban on party slogans/campaign material on photos" are all areas where "there is lots of scope ... so be imaginative" the presentation explains.
The "Liberal Democrat Best Practice Manual," which we have also seen, shows the same turn of thought in operation at LibDem HQ. Here, Lib Dem MPs are advised about how to "include material that does not meet fees office guidelines" - for instance, "appeals for money" by "paying for the report by other means and pay from the Incidental Expenses provision for advertising space".
What that means, in practice, is sending out LibDem propaganda and charging the taxpayer to run a small ad in a corner advertising the MP’s constituency surgery. Nick Clegg himself employed this kind of strategy himself in 2006, charging taxpayers £300 for inserting adverts about his surgery into Liberal Democrat campaign literature.
But now we get to Exhibit A: PAUL ROWEN MP
In today’s Spectator, I give some examples of exactly how this tactic – to get the taxpayer to cough-up for campaigning – actually works, and focus on two LibDem MPs: Paul Rowen, a former party whip who sits on the Public Administration Committee, and John Leech, the LibDem transport spokesman. The evidence shows that taxpayers’ money has clearly been recycled through Rowen’s expense account and into his LibDem campaign. Here are the details.
Using an organisation called Rochdale Liberal Democrat Print Society, Rowen has claimed £6,000 for the purchase of part of an envelope-stuffing machine, as well as a whopping £700 to advertise his surgery in the newsletters printed on it. And this advertising revenue, of course, helped pay for the distribution of his campaign material – just as the party recommended.
Rowen has also cleverly charged taxpayers for advertising in the local cricket, football and rugby grounds – in one year we paid £1,493 for this privilege. How on earth can Rowen justify this spending to his constituents?
But his imaginative use of expenses goes much further. Since becoming an MP he has filed invoices to Parliamentary fees office for nearly £20,000 in rent for his constituency office on Drake Street in Rochdale. While every MP needs an office, what is interesting about Rowen’s is that it is owned by local Liberal Democrats through a shell company called Rochdale Reform Buildings Ltd. Before Rowen was an MP, this “company” gave him this office space for free. The moment he could claim rent on expenses, he did and the funds were paid to the shell company. The question I put to Rowen’s office earlier was simple: why is an office given for free one day, and then cost thousands of pounds of rent on the next day? Answer came there none.
What happens to this public money next is really interesting: in October 2005, RRB Ltd sends Rowen a cheque for £1,793 – an amount almost exactly equal to his quarterly rent. In fact,
the Rochdale Lib Dems are so blatant about the relationship between that public money and their campaigning income they even file accounts to the Electoral Commission in 2005 containing the
following statement:
"Income in the year increased as a result of part of our headquarters now being rented as an office suite to the new MP."
Straight-forwardly enough, using the mechanism of expenses the public purse is funding the Lib Dem political campaign.
This is clearly unacceptable but gets worse. The 2004 Rochdale Lib Dem accounts, from the period before his election, show that the notional value of Rowen’s annual rent of the offices was just £660 per annum. As soon as he becomes an MP, these costs rise to thousands of pounds per annum. In the year after his election, taxpayers paid rent on Rowen’s office of £5215.07, in 06-07 we paid £5696.69 and a year later £7814.33. Curiously, after the expenses scandal broke Rowen seems no longer to have filed them.
While the duck houses could be blamed on lone MPs, the scams of using taxpayers money for party coffers has been encouraged throughout the Lib Dem party. Nick Clegg should be ashamed.
Previous
Peter Stroud
April 22nd, 2010 12:16pm Report this commentWait for the LibDim trolls to start shouting another Tory smear!
Alan Douglas
April 22nd, 2010 12:19pm Report this comment... feet of Clegg ...
Alan Douglas
Ian C
April 22nd, 2010 12:19pm Report this commentGood work. Can this now be boiled into two sentences so the mindless media can/will use it? And is it being done across the party?
Ron Todd
April 22nd, 2010 12:20pm Report this commentThe more the fat prats in the commons fiddle the more demands we will get for tax payer funding of the parties.
I pay enough tax already thank you very much.
toco
April 22nd, 2010 12:25pm Report this commentThis LibDem scam at the expense of us taxpayers is scandalous and Clegg should be required to issue a public apology.
2trueblue
April 22nd, 2010 12:33pm Report this commentDuck houses sounded catchy so people stopped looking at other things. Amazing that MR. 'I Will clean if up' Clegg forgot about these items? Loss of memory? No, just thought that it would not come to light. When you are in the spotlight R Clegg you are in the spotlight. Just like the serial flippers, no one has bothered to put the light on that.
alexsandr
April 22nd, 2010 12:36pm Report this commentno, Ed (Who wrote the original piece above) should send his findings to the Lancashire Police with a request for a fraud investigation.
Tim
April 22nd, 2010 12:39pm Report this commentNo wonder the Liberal Democrats push these matters to the limit given the huge disparity with both Conservative and Labour funding. If this, The Daily Telegraph "investigation " and the quite pathetic article in The Daily Mail about Nazi tendencies are examples of scrutiny then quite clearly absolute panic has set in within Tory circles.
It is of course highly ironic that the Telegraph exposure of the expenses scandal is going to lead to change but probably not in the way they anticipated.
Attack the policies of the Lib Dems by all means but leave out the obviously personal attack here on Nick Clegg mostly directly but sometimes indirectly.
If this is the idea of a positive Tory camapign I would hate to see a negative one!!
wound-up
April 22nd, 2010 12:54pm Report this commentIan C is right. This seems complicated, arcane even tiresome in this form. It will have not the slightest effect on media editiors until it's spoon fed them with a pithy narrative. This is what Mr Saachi is good at.
Tiberius
April 22nd, 2010 1:00pm Report this commentSuch things will carry much less traction when they are not related to a Tory.
The shorthand that has developed for scandalous expense claims is "duck houses" and "moat cleaning". It is not "hubby's porno films" or "shared cleaner's expenses".
The TV programmes I saw last night about Clegg's bank account were very keen to point out that his personal account was only a clearing facility, and it was years ago (try that excuse in defence of Caroline Spelman).
The point is that MPs should not only be clean, they should be seen to be clean. But it is only the Tories who have to suffer the cry of "witch".
David B
April 22nd, 2010 1:05pm Report this commentIn the last debate Cameron said that all the parties had problems with donations and expense. Clegg started to get very angry over the mention of Michael Brown.
Now we can see why, he is trying to keep all his skeletons in the cupboard while trying to paint the other parties as tainted and unfit to govern.
You know what they say about people in glass houses!!!
Fatbloke on tour
April 22nd, 2010 1:11pm Report this commentOf course what is the alternative?
Suck up to an off-shore millionaire who has money to burn and an ego to feed?
No surely not even the Tory right wing dog boiling establishment doesn't have the brass neck to pull that flanker?
Whatever next, putting him up for a peerage and inviting him along on official business?
You must be getting very worried, you were expecting a coronation and now you are looking at 14 days to save Scratchy's career.
Oh well if it all go breests up he can always rely on the MiL to pull a few "strings" to get him a nice little cushy job, where his talent as a well spoken Eton educated PR man can be put tp good use.
By the way any thoughts on why Scratchy aka "ShamCam, the flim flam man" doesn't like China?
Possibly Gramps had a soft spot for Hong Kong?
Prime ministerial my arse.
Political souffle promoted two levels above his ability.
Terry
April 22nd, 2010 1:12pm Report this commentI have been querying the expenses of my own LibDem MP here in Westmorland. I did not think when I started that this was part of a deliberate Libdem policy. The reaction of the local Libdems is revealing. They do not realise it is wrong.
http://www.thewestmorlandgazette.co.uk/news/general_election_2010/news/8105319.Baroness_praises_Lib_Dem_candidate_on_Kendal_visit/#commentsList
Rose
April 22nd, 2010 1:22pm Report this commentHi. I just popped in to ask Richard (of York), Tim, the travelling Fatman et al if they are doing the Edinburgh Festival this year?
With a bit of rehearsal they might even be invited to appear in Comedy Clubs around the country.
Best take a break now, chaps, and work on your new scripts.
Fernando
April 22nd, 2010 1:28pm Report this commentIan C - Public funding of political parties.... by the back door
or Public money used for party political purposes.
Any Colour but Brown
April 22nd, 2010 2:06pm Report this commentLibDems launder taxpayer's money through fake companies, whereas Labour launder it through UNITE.
The only difference is the amount
Griff
April 22nd, 2010 2:06pm Report this comment#1. Yes, most of the general public are pretty good at recognising smears now. A co-ordinated attack on the Lib Dems this morning by 4 Tory newspapers - it seems that Andy Coulson, ex editor of the News of the World, has been busy over the last few days.
Viv Evans
April 22nd, 2010 2:56pm Report this commentNota bene:
reporting on the wrong-doings of the LibDems is now not just an 'attack', it is a smear.
Reporting on anything not even faintly similar done by Tories is fully justified, not an attack, not a smear, but 'the people's righ to know'.
Throw in words like 'nasty tory press', and have the oh-so-fair, totally unbiased Beeb report it, and you get the present situation.
I wish someone would explain why it is fair and necessary to scrutinise everything coming out of a Tory mouth, but everything spoken by any LibDem or NuLab person is as true as can be and needs no scrutiny whatsoever.
Clegg and the LibDems have had the privilege of sailing under the radar, being second division.
Now they're aiming fro the top jobs, the heat is on them, as it has been on the Tories for years.
Gotta live with this, Cleggie.
Ken
April 22nd, 2010 2:59pm Report this commentFMOT: "Political souffle promoted two levels above his ability" - Most accurately applied to describe half the appointees in Liebour cabinets since 1997 but make it 6 levels.
For tokenism they will be hard to beat.
oldtimer
April 22nd, 2010 4:15pm Report this commentGuy News pointed out something similar re Sarah Teahter and other LibDem MPs here:
http://www.youtube.com/watch?v=XFHFWO2jEvY
It seems to be a regular scam for them.
anne allan
April 22nd, 2010 7:41pm Report this commentThis sounds familiar; I have heard of another constituency where its LibDem MP has been indulging in these arcane practices.
michael
April 23rd, 2010 10:44am Report this commentthe real questions for
Mr 'socialchapterbacktax' Clegg wrt his bank account are ones of employment.
who actually employed this 'help'...
The donor, the party, or Mr Clegg.
Grey areas are usually tax....'efficient'
Who has the admin?
Have all the relevant NI PAYE collections been made and passed on.
Have employers contributions been made?
If Nick Clegg was the employer, and non of the above have been administered , has he payed income tax on the donations?.........In the same way that employing an au pair or a mechanic is paid out taxed income.
Whiter than white? .... if the Inland Revenue were investigating, Mr Clegg would be legally obliged to prove his own innocence.
michael
April 23rd, 2010 11:38am Report this commentWas that one of Nick Clegg's previous bosses? 'Pissed' on This Week.
Perhaps one of DC's previous bosses should have been similarly touched on Question Time.
Supertelly debates.
It's interesting to see just WHO cares
Tony Gilligan
April 23rd, 2010 12:16pm Report this commentRochdale is not covered by Lancashire Police - the correct service is Greater Manchester Police and in my humble opinion they should be investigating these extremely serious claims that have been made in the Spectator about Liberal Democrat Parliamentary expenses.
Mr Rowen has a lot of explaining to do. he has already tried to dismiss this article by describing this as a "Right Wing Tory Smear".
But let's make sure all the FACTS come out for the electorate to decide.
Mr Rowen states that his office rent was set by an "independent" surveyor. No it wasn't - there is a clear link to the Chartered surveyor who set the rent - Mr Crossley - and Mr Crossley's (and wife's) shareholding in Rochdale Reform Buildings Ltd- Mr Rowen's Landlord- a company with a registered address at Rochdale Lib Dem HQ in Drake Street and directors that included former Liberal MP Cyril Smith and former Lib Dem Leader of Rochdale Council Alan Taylor. Cllr Taylor's "partner" is also the company secretary of the company that donated to Rochdale Lib Dem Accounting Unit (see Electoral Commission website).
Keep up the excellent work of exposing smug Lib Dem hypocrisy. The manner in which the Lib Dem council and Lib Dem MP in Rochdale have mismananged, cocked-up and covered-up with bare faced cheek and spin is truly remarkable.
Matt Boothman
April 23rd, 2010 3:26pm Report this commentI live in Rochdale. No way is that dilapidated old office on Drake Street worth £5215 p/a. It's not even worth £52.15 p/a.
Seeker of Truth & Justice
April 26th, 2010 3:33pm Report this commentLiberal Democrat Councillors in Rochdale, who control the local Council, are forced to hand over 10 per cent of all their Councillor’s allowances to cover the party to fund political activity. There is no choice, it’s compulsory.
Councillor allowances are meant to help meet the costs of representing their communities across the four townships of Rochdale, Pennines, Heywood and Middleton and not fund political activity. The level of payment is set by an independent review body.
All local councils must pay their members a basic allowance - the same level for all members. This is intended to cover time commitments and incidental costs. The basic allowance includes an amount to cover all travel they may incur when undertaking duties within the borough, subsistence and a contribution towards land line telephone costs. The basic allowance paid to all Rochdale Borough Council members during 2008/09 was £7,644.
Such funds for Councillors come from locally collected Council Tax. Rochdale Lib Dems this year set a near 4% increase the highest in Greater Manchester and one of the highest in the country.
During 2008-2009, Council allowances paid in Rochdale to Lib Dem Councillors totalled over £375,000 meaning £37,000 being paid to the local Lib Dems through the Council tax to fund their political activity.
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