Parliamentary watchdog Ipsa is set to recommend a rise of £7,600 to £74,000, to come in after the 2015 election.
Ipsa does not need to get the agreement of Parliament to bring in the changes.
But Treasury minister Danny Alexander urged it to reconsider, saying it would be “wholly inappropriate” at a time of curbs on pay in the public sector.
The rise – to come into effect in May 2015 – comes as part of a package of changes to MPs’ salary and benefits which would see some allowances scrapped.
MPs currently earn a basic salary of £66,396 but the Independent Parliamentary Standards Authority is expected to say on Thursday that their pay has fallen behind in recent years and a substantial “one-off” rise is justified.
The BBC’s political correspondent Gary O’Donoghue said Ipsa would conduct a statutory review of pay at the start of the next Parliament, at which point the rise could theoretically be reversed, but this remains unlikely.
All three party leaders disagreed with the move when it was first proposed earlier this year but the watchdog is expected to say it will press ahead with the rise – expected to cost the public purse £4.6m.
What I’m concerned about is to ensure that the pay is sufficient to attract people from modest backgrounds ”
Jack StrawLabour MP
Mr Alexander, Lib Dem Chief Secretary to the Treasury, urged the watchdog to reconsider, saying it must take into account public opinion as well as “the wider economic climate and the climate of people’s living standards”.
It would be “wholly inappropriate for MPs to get such a large pay rise when every other public sector worker sees their pay rises capped at 1%,” he told the BBC’s Andrew Marr show.
Conservative defence secretary Philip Hammond said he would not personally be accepting the pay increase, saying it was the “not the moment” to do so.
“Whatever the rights and wrongs of whether MPs’ pay is too high, too low, comparable to other people, at a time when we are asking people across the public sector – nurses, doctors, teachers – to accept pay restraint, members of Parliament have to be seen to be leading the way,” he told BBC Five Live’s Pienaar’s Politics.
He suggested the Cabinet would take a “collective line” on the issue of whether to accept the rise or not.
It is regarded as a no-brainer by MPs that many voters loathe the idea of politicians being paid more, especially at a time of austerity.
The main party leaders conclude that it’s too politically toxic.
But privately a lot of MPs believe a pay rise, however unpalatable to taxpayers, is justified.
Like so many workers, they have seen real-terms pay cuts in recent years (albeit on salaries at least three times the average).
Other perks have also been trimmed since the expenses scandal.
Few are keen to put their head above the parapet, but those who have argue that MPs’ pay has fallen behind that of head teachers, doctors or local council leaders.
The argument goes that people from those middle class professions could be deterred from running for Parliament.
“We could end up with a Commons full of toffs and nerds,” a former MP once said to me, adding that this would not be an unedifying combination.
But no matter how many arguments are put forward in favour of a hefty pay rise for MPs, it’s not going to be an easy one to sell to the public.
Shadow Chancellor Ed Balls told the Dermot Murnaghan show on Sky News that the proposed increase was “preposterous” and he could not defend it at a time when people were facing a “cost of living” crisis.
But former Labour foreign secretary Jack Straw, who is retiring as an MP in 2015, said the party leaders could not complain about the decision after handing responsibility over to an outside body.
“What I’m concerned about is to ensure that the pay is sufficient to attract people from modest backgrounds who have not inherited a house, who don’t have family or personal income, but who are going to make a career out of politics,” he said.
And Conservative backbencher Sir Peter Bottomley said it was sensible for MPs’ pay to be set by an outside body at the start of each Parliament, with a regard to how to attract MPs from all walks of life.
“The only way MPs could overturn this is to defy their leaders and pass a law saying Ipsa is abolished or it will be ignored,” he said. “That’s impractical given the public interest in setting up Ipsa first.”
Tea and biscuits
A Downing Street spokeswoman said MPs’ pay was “a matter for Ipsa” but ministers believed the “cost of politics should be going down, not up”.
Ipsa previously said it had looked at increasing the current salary of £66,396 to anywhere between £73,365 and £83,430, but opted for a lower figure “in recognition of the current difficult economic circumstances”.
After 2015, it proposes that MPs’ wages would increase annually in line with average UK earnings.
At the same time as recommending a pay rise, the watchdog is also expected to announce a squeeze on pensions and the resettlement grants that MPs are given when they leave Parliament.
The amount that MPs have to contribute to their pensions is set to increase while MPs’ final salary scheme is expected to be downgraded to a career average in line with the rest of the public sector.
Other changes would also see a £15 dinner allowance and claims for tea and biscuits scrapped. And it would mean taxpayer-funded taxis were only permitted after 23:00.
There would also be a crackdown on claims made for running second homes, with costs such as TV licences and contents insurance no longer being met.
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