Kevin Barron MP – Expenses Detail

Rother Valley MP Kevin Barron, who reportedly claimed monthly mortgage interest of £1,509 on his London flat in 2004/05, which rose to £1,791 in 2005/06. It increased in 2007/08 to more than £2,000;

Blunkett’s expenses claim for path repair – The Star

When I uploaded the information that Kevin Barron MP has in his surgery window in Dinnington I noted that it wasn’t clear if the amounts he claimed under the heading Rent/Mortgage Interest was, in fact rent, or mortgage interest.

The figures got higher year on year  – despite interest rates varying very little – so I thought they might be rent, but The Star seems certain they are mortgage interest payments. I’m not sure where they have got their figures from though, as they don’t match the ones in the window – but then they don’t match the figures previously published either.

The figures in the window of Kevin Barron’s surgery window for Rent/Interest claimed on expenses are:

2004/5  £14,557.70 (average of base-rate  in period 4.6%)
2005/6  £17,098.76 (average of base-rate in period 4.58%)
2006/7  £18,481.25 (average of base-rate in period 4.83%)
2007/8  £19,936.72 (average of base-rate in period 5.52%)

The biggest percentage increase is from 2004/5 to 2005/6, when the interest claimed by Kevin Barron MP went up by over 17%, despite the base rate falling.

What is interesting is that Kevin Barron MP claimed pretty much the most he could each year. I can’t find the figures for the yearly limits as yet, but I know that he was claiming the absolute maximum in the latest year – one can only assue he shopped around for his mortgage very carefully each year in order to maximise the amount he could pay to a mortgage company, or that he had a very bad mortgage deal that got more expensive each year even when the base rate fell, or that he has increased the amount he has borrowed each year.

If I could claim my mortgage interest on expenses and wanted to make some money out of it, I think I would soon think of the idea of extending the value of my mortgage each year and using the borrowed money to pay of some of the capital. The increased annual allowance would allow of the extra borrowing (which would have been supported by the rise in value of the property) and I would be left with a property with more equity – thus meaning when I sold it I made more money.

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3 responses to “Kevin Barron MP – Expenses Detail

  1. Of course, IF you could claim your mortgage interest on expenses you WOULDN’T extend the value of your mortgage because you WOULDN’T want to make some money out of it …. would you ?

    • Your argument about paying off the capital makes no sense. If he extends his mortgage by, say, £20,000, then that is £20,000 he still has to pay back at the end of the mortgage term. He can’t use that to pay off the capital, as the capital has just increased by £20,000. The only way he could make it work is to put that £20,000 into an investment (say a FTSE tracker, or even gilts) or to trade up the property ladder to get the biggest possible property so that the rise in value is maximised.

  2. Oh yeah – see, this is why I wouldn’t fiddle – I’d be useless.

    You’re right – you’d extend the mortgage, invest the money elsewhere and charge the extra interest to the tax-payer.

    If you bill me for your advice I’ll submit it on my expenses.

    I don’t know who this ‘he’ is you refer to by the way – I’m not saying anyone has done anything like what I outlined, just that it might occur to someone who was looking to make money out of their expenses. 🙂

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