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Research compiled by Richard Teather (Senior Tax Fellow, Adam Smith Institute). Commentary by Dr Eamonn Butler (Director, Adam Smith Institute).

How MPs live like multi-millionaires

MPs' generous expenses, index-linked pensions and second-home allowances give them a multi-millionaire lifestyle that their constituents could scarcely dream of, according to these shock figures, compiled by the Adam Smith Institute's Senior Tax Fellow, Richard Teather.

If MPs' perks are treated as post-tax income, then the average MP enjoys a gross salary, not of the headline £64,766, but of a staggering £319,165. That is nearly 18 times the pay of the average voter.

Teather, a tax expert from Bournemouth University, has also produced a 'fat-cat ranking' for each of our Westminster representatives. He starts with MPs' basic salaries – ranging from £64,766 for backbenchers to £194,000 for the Prime Minister – and adds in their pension rights, another £17,357 for backbenchers, up to £52,059 for Gordon Brown.

But what is the value of all those expenses claims – from barbecues to bathplugs – that the rest of us would never have a hope of getting through our employers, never mind the steely gaze of Her Majesty's Revenue and Customs? Teather's figures show that to pocket the same amount that the average MP claims in expenses, the rest of us would have to earn £228,215 before tax and National Insurance were taken out.

It all amounts to a total pay package worth £319,165 – and that is just the average. Welsh Secretary Paul Murphy tops the league table with a package of pay, pensions, and expenses worth £423,932 a year. That is more than 28 times the average income of his Torfaen constituents.

On the best interest rate currently available – 1.83% from Birmingham Midshires, you would need over £23 million (£23,165,683) to get an income matching Paul Murphy's annual £423,932. You would need over £17 million (£17,440,710) to earn in interest what the average MP earns from Westminster.

The highlights of Richard Teather's research are detailed below, but our 'Top Tens' are also available in PDF format here. You can download the full data on MPs' expenses and total pay equivalent by clicking here.

The fattest and leanest cats

According to Teather's research, the top ten fat cats are all Labour MPs, including Hazel Blears, Jack Straw, David Miliband and Geoff Hoon – recently embroiled in the 'three homes' row. That, of course, is largely because their total income is boosted by their ministerial salaries, rather than the volume of expenses they claim. But we should also remember that many ministers get other perks that do not have to be claimed for – like the chauffeur-driven cars and grace-and-favour apartments. And they rarely have to buy lunch, dinner, or drinks for themselves.

Eight out of the leanest ten MPs are Conservatives, including Malcolm Rifkind, John Redwood and Sir Nicholas Winterton – perhaps now chastised after taking £66,000 in expenses for 'rent' on a home owned by his family trust.

The MP who cleans up most from expenses is Ann Keen (Labour, Brentford & Isleworth), whose £167,306 expense claims are worth a staggering £283,569 before tax and National Insurance.

The Keen family is remarkable. Ann’s husband Alan Keen is also an MP, with a salary and expenses package worth £330,272, and her sister Sylvia Heal is an MP as well, with a package worth £338,294. That is more than £1m (£1,071,617 in fact) between the three of them.

The regional fatcats

Welsh MPs are the fattest regional cats, with earnings equivalent to £323,068 – over 20 times the pay of their constituents. Other MPs, like Gordon Brown, have a larger overall cash package, but their constituents are wealthier too, so their earnings do not soar quite so spectacularly above those of their constituents.

The leanest are MPs from London, at £308,881 or nearly 15 times the pay of their constituents – but that is because many London MPs live too near to Westminster to claim a second-home allowance.

Of the individual MPs, the top 10 regional fat cats were:

And the top 10 regional lean cats were:

Fat kittens

Along with the £1,000 fireplaces and £550 sinks, MPs' expenses also include the costs of assistants. We defend the inclusion of these staff costs in the figures, since MPs routinely employ family members to boost their household income. (Though rather less of them do now, since the case of Derek Conway, who claimed for his full-time student son. He has chosen not to stand for re-election.)

It is worth asking, for example whether even Jacqui Smith would pay a non-relation £40,000 a year for the rather flawed administrative help that her husband provides as her assistant, paid from taxpayer funds. The rest of us are challenged by HMRC when we employ relatives, and have to show that their job justifies the pay. But MPs' affairs are dealt with by a special HMRC office in Cardiff, which seems to exempt MPs from this sort of scrutiny.

In addition, much of the work of MPs' assistants involves campaigning for their re-election. Critics of the Parliamentary expenses system see this as corrupt as those MPs who claim their full expenses allowance and then make large donations to their local Party – in effect, a taxpayer subsidy to their political grouping and their general election campaign.

In my new book, The Rotten State of Britain, I claimed that MPs "conspire in an organized and systematic scam against the public". Richard Teather's figures show just how enormous that systematic scam really is.

MPs are always embarrassed to raise their salaries, so they decided to take instead what my colleague Dr Madsen Pirie has dubbed 'stealth salary' – getting the same money, but in the form of expenses. Aided by advisers and officials, they almost all organized their affairs to get the maximum benefit – making their sister's spare room their 'main residence' or charging 20p a mile for cycling to Westminster, for example. They never imagined for a moment that their expense chits would ever see the light of day. That was not supposed to be part of the deal.

But now these expenses are indeed being exposed. And it is not just the huge range of goods and chattels that they've been claiming for, but the enormous scale of the scam that appals their voters. To live like an MP, it seems, any of the rest of us would have to be a multi-millionaire.

Download PDF files:

The fatcat MP list – top 10s and highlights

Full data on MPs expenses and total pay equivalent