David explains to his electors

17 May 2009

Of course, my electors deserve an explanation from me about the press revelations this weekend.

Despite the impression given, I have committed no crime and had my then partner, Brenda, and I split up in 2004, and she had gone off to Australia, buying her out of her half of our London flat would have been uncontroversial.

Now, after twenty three years as an MP our reputation has been tarnished even though I acted in good faith and on the advice of the necessary authorities. I want to be very clear - we have made no money out of this. The second mortgage I took out to buy the sole ownership of the flat I stay in in London still has to be paid off by me - not the taxpayer.

I copied all of my claims and associated documents to the Journal newspaper voluntarily on Friday 15th May. I was contacted by the Telegraph on Saturday 16th to say they were running a story from the leaked information they held, on Sunday.

Brenda and I are devastated at the impact this has had on our lives and the damage to our reputation as a hard working couple for the people of Tyneside and the North East. Some MPs undoubtedly have abused the system, that is clear, and we are upset to be now lumped in with those who have bought garden sheds, home cinema systems, multiple televisions etc.

But more important than us is the general political fall out across the country. It is a volatile and dangerous situation for which MPs and no one else are to blame. I am genuinely sorry and apologise to my electors and all who know me that I have been part of the Parliament that has allowed this situation develop and I will do all I can to see that it is rectified as soon as possible.

All claims are now to be independently investigated and if by any chance, and despite the advice and information I was given at the time, there is any question whatsoever about the action that was taken I will of course take whatever steps they recommend to correct matters.

Here is the outline of the history of the situation that I provided to the Telegraph on the main issue they were running with and which I subsequently also sent to the Sunday Sun.

When Brenda Graham and I began our new life together at the beginning of 1999 I was living in rented accommodation in Dolphin Square, Pimlico. The rent at that time was £650 per month.

Brenda had a large sum of money she inherited from her parents and wanted to invest it for her retirement and her two daughters. She decided that the London property market, which was booming at the time, was a good way to do this and we decided to buy a flat together. She would provide the Deposit with the sum she had to invest and I would move in as my London address for Parliamentary purposes. In 2001 we secured a joint, interest only, mortgage on an ex-council flat in Lambeth. The flat was registered in both our names. The interest payments were met by the 'Fees Office' in the normal way and amounted to £540 per month - providing a saving to the tax-payer of £110 Per month. A win-win situation.

After three years and the pending introduction of the 'Freedom of Information Act' all sorts of rumours were circulating as to how this and other pressures on the MPs' allowances system would affect things. There were suggestions that where MPs were 'sharing' a flat with another person the Fees Office should pay only half the rent or interest on the mortgage, that when MPs' flats were sold any 'profit' on the sale should go to the tax-payer, and that the Freedom of Information Act would reveal personal details of partners sharing accommodation as well as MPs themselves.

Brenda was understandably very concerned about this as she could see her parents' inheritance being locked into the flat with no prospect of any growth. Also, that despite having provided a large deposit - thereby keeping interest payments down - she could also be faced with having to pay 50% of the monthly payments even though she herself did not live there. However realistic or otherwise these prospects were, like any other right minded person faced with the same situation, naturally she wanted out and her inheritance money back. We were not then married, after all.

We spoke about this and I asked for advice from the Fees Office. The advice was that I could buy her out of her 50% so that she could release her money and invest it elsewhere. Also, as her money had been lying there for 3 years she wanted to know if she was allowed any growth in that period. We were advised to get a valuation, which we did and found that the value of the property in the very volatile London property market at the time had indeed increased substantially.

I therefore applied for, and was granted a second mortgage to return Brenda's deposit and her half of the increased valuation. The flat was then transferred to my sole name. This arrangement and the valuation were fully discussed with the fees office, supported by my bank, properly conducted and legally processed.

Brenda and I later married. For those who think that means we therefore jointly benefited from the second mortgage arrangement they should consider this. The money Brenda received over and above her original deposit did not come like manna from heaven. It was borrowed from the bank and still has to be repaid. The fees Office only pay the interest, not the capital. That was down to me and now it is down to us, so Brenda is responsible jointly with me to repay the loan at the end of the day. Unless there is a net gain on the sale of the property - and in today's housing market that is unlikely - there will be no net gain to us either.

Finally, because of falling interest rates, the monthly interest payment on my flat, paid by the Fees Office, is now £330 whereas the rent at Dolphin Square is now £350 a WEEK.

All members' claims for the last four years are now to be put to an independent scrutiny committee and, if for any reason and despite the advice we were given at the time, they feel there is anything wrong or irregular about the arrangement in my case then of course I will make full redress.

David Clelland

NB: I live in a one bedroom, former council flat in Lambeth right next to the Waterloo main line. Thankfully there are few trains between 1am and 4am.

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Promoted by Ken Childs on behalf of David Clelland, both of 19 Ravensworth Road, Dunston, Gateshead. NE11 9AB