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  • Writer's pictureHertford and Stortford Labour Party

Labour vows to close severance 'loophole' exploited by Marson

The Labour Party has pledged to reform the rules on taxpayer-funded severance payments handed out to government ministers when they leave their jobs. 


Under the current rules, Julie Marson, the MP for Hertford and Stortford, was able to claim a payout of £4,479 in September 2022, which Labour says would have been reduced to £920 if their new proposals had been in place.


Ms Marson was originally appointed as an assistant government whip on 8 July 2022 after Boris Johnson faced a slew of front bench resignations during the final weeks of his premiership. She served in the role until 20 September 2022, when she was sacked by new Prime Minister, Liz Truss, a fortnight into her own short-lived premiership.


Despite only earning approximately £3,682 in her seventy-five days in the government whips' office, Julie Marson claimed £4,479 in severance, equivalent to three months wages. She then returned to exactly the same job 38 days later after Rishi Sunak succeeded Liz Truss as Prime Minister, but was not required to return her previous severance payment.


Mrs Marson was one of ninety-seven Tory front-benchers who claimed severance payments during the political chaos of 2022/23, as control in Downing Street switched from Johnson to Truss, and Truss to Sunak. It was recently revealed that the total severance bill over the course of that financial year cost UK taxpayers £933,086.


Since 1991, when John Major was in Downing Street, ministers have been legally entitled to three months' wages at their current annual salary when they leave their post, no matter how long they have been in the job, or the reasons for their departure.

 

Labour has now announced that, if the party is elected to government later this year, it will change the law so that individuals can only claim a quarter of their actual earnings as a minister in the previous twelve months, not a quarter of their annual salary. In the case of Julie Marson, that would have brought her payout down from £4,479 to £920, almost a fifth of what she was able to claim under the current rules.


Labour is also proposing two other changes to what it calls the 'glaring loopholes' in the current law on severance payments.


  • First, any minister who returns to a new job while still enjoying the benefit of their severance payment will have the corresponding amount clawed back. At present, ministers are only required to refund their payouts if they return to government within three weeks.


  • Second, any ministers who lose their jobs because of allegations of misconduct or breaches of the ministerial code will in future have their payouts suspended, and quashed entirely if those allegations are upheld. 


Altogether, Labour has calculated that – if its proposed reforms to the severance rules had been in place in 2022/23 – the total cost of ministerial payouts would have been cut by more than 40 per cent in that year, from £933,086 to £555,093, a saving for UK taxpayers of £377,993, including a £3,559 reduction in the payment to Julie Marson.


Josh Dean, Labour's Parliamentary Candidate for Hertford and Stortford, welcomed his party's new proposals on ministerial severance, saying:


"It was always deeply wrong that Julie Marson could claim three months' severance for seventy-five days work, and then return to the same job thirty-eight days later, and all at the taxpayers' expense. If she claims she was just following the rules, then it's clear those rules need changing, and I'm pleased that is what Labour has now proposed.


"But that doesn't change the fact that, at a time when families in our community were struggling just to pay their bills and put food on the table, Julie Marson thought she was entitled to £4,479 from the taxpayer. That says to me she does not understand how hard life is right now for people in our community. 


"This year, we have the chance to get rid of the government that has caused such misery in our country and such chaos in our politics, and we have the chance to elect a local Labour MP in Hertford and Stortford who understands the issues faced by our residents and will work to tackle them. Only a Labour government is going to bring about the change that Britain so desperately needs.”

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