There is a long tradition of elected representatives in the UK drawing income from activities ‘external’ to their work in parliament. In part, this tradition reflects the belated acceptance of a need to pay MPs a full salary. In the 2012 Audit of UK democracy, Stuart Wilks-Heeg, Andrew Blick and Stephen Crone looked at the history of MPs pay from both inside and outside of Parliament.
This article was originally published on the Democratic Audit blog.
While proposals to pay MPs date back to 1780, parliament opted to vote against introducing payments on at least six occasions in the nineteenth century. Indeed, MPs did not receive any payment for their role as parliamentarians until allowances of £400 per annum were introduced by David Lloyd George in 1911.
While allowances paid to MPs did gradually become defined as a salary, their value was only raised sporadically over the next 50 years, causing their real financial worth to decline. Only in 1946, when pay was raised from £600 to £1,000, was the real value of these payments restored to their 1911 level. Thereafter, as Figure 2.6b shows, MPs’ salaries fell again in real terms during the 1950s. By the 1960s, it was clear that some MPs were suffering genuine financial hardship.