Legg orders 390 MPs to repay £1.1m

Public faith in Britain's political classes sank further on Thursday as 390 MPs were ordered to repay £1.1m of inappropriate expenses and several were braced to hear whether the Crown Prosecution Service would pursue criminal charges.

With the general election less than four months away, more than half of all MPs - including the three main party leaders - were publicly chastised for taking advantage of a "deeply flawed system" of allowances.

Sir Thomas Legg, a former Whitehall mandarin turned expenses enforcer, listed overpayments ranging from £40,000 to 40p in a report likened to a Domesday Book of parliamentary excess.

His investigation has infuriated backbenchers and helped to accelerate the biggest parliamentary exodus since the second world war, which will see at least 150 MPs quit politics before the election.

The day of reckoning will ultimately still leave taxpayers out of pocket, however. The cost of the Legg review was £1.16m - some £40,000 more than the £1.12m recouped from errant MPs.

Although the Legg report is an important stage in bringing some closure to the expenses saga, the repercussions of last summer's scandal will continue for weeks to come.

Not only will the Crown Prosecution Service announce on Friday whether it will pursue criminal charges against a handful of the worst offending MPs, there will also be another 13 appeals against the Legg review from MPs who missed a New Year deadline.

Sir Paul Kennedy, a former judge brought in to oversee appeals by MPs, has already allowed 44 to be upheld at least in part - helping some MPs protect their reputations as they prepare for tough re-election battles. Peter Lilley, former Tory cabinet minister, had a £41,000 demand dropped entirely.

Indeed, in several judgements Sir Paul said he was "troubled" by the idea that "legitimate transactions" had in retrospect been described as "tainted" or "wholly invalid". Questions also remain over the £300,000 which has not yet been paid back by MPs and former MPs. They include Ivor Caplin, a former Labour MP, who ignored requests to provide evidence for £17,865 of mortgage claims in 2004-05.

As such the scandal could linger even in the run-up to the election, where several independent candidates, including Esther Rantzen and Martin Bell, are campaigning on an anti-sleaze ticket.

However, the exact electoral impact of plummeting public trust in politicians remains uncertain, particularly as many of the MPs most closely implicated by the scandal are stepping down. John Curtis, professor at Strathclyde university, said: "There are so many of them in the frame that it is hard to target individuals."

Sir Thomas said the MPs expenses saga had been "traumatic and painful". Public confidence had been damaged and the "scars would no doubt take time to heal", he wrote in his 237-page report.

All three of the main party leaders were among the MPs asked to pay back money, with Gordon Brown ordered to return £12,000, mostly relating to cleaning.

There was anger within Westminster on Thursday as some MPs criticised the "retrospective" nature of some of Sir Thomas's decisions, including his demands for money to be paid back on what he deemed excessive claims.

The process of replacing the discredited Fees Office, which oversaw the tarnished claims, is meanwhile going ahead, though not without controversy.

Sir Christopher Kelly set out recommendations in November, including an end to taxpayer-funded mortgages, in favour of MPs having to rent.

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