MPs' expenses watchdog told to change or be scrapped

The MPs' expenses watchdog was under unprecedented threat today after Downing Street refused to rule out scrapping it.

David Cameron has branded the Independent Parliamentary Standards Authority "anti-family" after a wave of protest by MPs having to live in one-bedroom second-home flats in London.

But the authority today stressed it would not "step back" from its duty to protect taxpayers' money, after the expenses scandal which rocked Parliament and could see several Labour MPs jailed.

MPs have called for the body to be scrapped or at least overhauled, accusing it of running a bureaucratic and costly regime.

The Prime Minister's official spokesman declined to rule out scrapping the new system of expenses, saying it was a matter for Parliament.

Mr Cameron told backbench MPs last night he recognised the body had "caused a lot of pain and difficulty" and said a "better system" needed to be in place by April 1, otherwise it would be changed, according to his aides.

But he refused to bow to pressure from MPs and highlighted the National Audit Office's refusal yesterday to sign off nearly £14 million of claims in the Commons accounts for 2009/10.

The watchdog said: "We have a duty to administer a system which is workable and fair to MPs. But we have an overriding responsibility to the public. We take very seriously the task of trying to restore public confidence in how MPs are supported by the taxpayer."