Alistair Darling came under fresh pressure to quit as chancellor yesterday when the Liberal Democrat leader, Nick Clegg, said he should be sacked for profiting from his parliamentary expenses.
Clegg has been making increasingly pointed attacks in the wake of the expenses scandal and was the only party leader to call for the Speaker, Michael Martin, to stand down. Yesterday he turned on the chancellor, accusing him of "flipping" the designation of his main and second homes and claiming public money for personal tax advice. This, Clegg insisted, meant Darling could no longer be trusted with the public finances.
The Telegraph accuses the chancellor of claiming back the cost of two properties at the same time, something prohibited by the parliamentary authorities.
The paper said that in July 2007 Darling submitted a claim for £1,004 for a service charge on his south London flat for the subsequent six month period, during which he moved into the grace and favour residence of the chancellor in Downing street. He then is accused of claiming his second home allowance on this property.
A spokesman for the chancellor denied the alleged rule breach. "The allegation of double claiming is simply untrue. He paid the bills due for his flat until he moved out in September 2007, after which he made no further claims for it," he said.
The calls for Darling to go came amid growing speculation over the future of the chancellor, with reports at the weekend that the prime minister wants to replace him with the schools secretary, Ed Balls. A reshuffle is expected after the local and European election results at the end of this week, or early next week, although it is unclear whether the prime minister has enough political capital to force Darling out if he refuses to move. Sources inside Downing street confirmed that Balls is in the running for Darling's job.
Clegg told BBC Radio 4's Broadcasting House yesterday morning: "He [Darling] needs to enjoy the public's trust when it comes to issues of financial probity, of money, of managing our nation's finances. And given that very unique responsibility that he has, it's simply impossible for him to continue in that role when such very major question marks are being raised about his financial affairs."
Vince Cable, the Liberal Democrat Treasury spokesman, also called for Darling's dismissal, accusing him of having been "caught with his fingers in the till".
Darling was reported by the Daily Telegraph to be among ministers who had paid accountants thousands of pounds of public money to complete personal tax returns, with his bills totalling £1,400 over two years. Ministers insisted the accountancy bills were in relation to their work as MPs and that the claims were allowable as parliamentary expenses.
It was also reported that Darling "flipped" the location of his second home four times in four years, allowing him to claim thousands of pounds towards the cost of his Edinburgh home and a London flat. A spokeswoman for the chancellor said Cable's criticisms were "untrue".
She said: "As Mr Darling consistently explained, he paid for personal tax advice himself. The accountant's fees claimed were for preparing his office accounts to ensure the correct amount of tax was paid. That's an allowable claim. The accountant's fees were fully declared for tax purposes and he paid tax on the benefit.
"The allegation that he changed addresses for personal gain is untrue. He changed the designation of his second home when his circumstances changed in accordance with the rules. He also pays tax on the benefit of living in Downing Street, and pays the council tax there."Speaking at the Guardian Hay Festival yesterday, Cable said he did not want to be chancellor under a Labour government. Asked if he would step in if Brown invited him to be an interim chancellor until the general election, Cable said; "No, I'm not interested in being co-opted. I'm part of a team, not acting as an individual."
He refused to say whether he thought other senior Labour figures, including Hazel Blears, Geoff Hoon and Jack Straw, should stand down after being accused of financial irregularities. "That's not my patch," he said. "I shadow Alistair Darling, that's why I'm focusing on him. He has no moral authority to run the economy in this time of crisis when he's been accused of flipping homes, accepting a grace and favour apartment and charging the taxpayer for accounting bills."