The Northern Ireland Secretary, Mr Peter Mandelson, was urged yesterday to repay an £11,000 severance payment he received when he resigned as trade and industry secretary amid the controversy surrounding his £373,000 home loan.
Under parliamentary rules, Mr Mandelson was entitled to receive the tax-free severance payment - a quarter of his £45,201 annual ministerial salary - when he resigned from the British government in December 1998. All ministers, except the prime minister and the lord chancellor, are entitled to the payment unless they are appointed to another ministerial office within three weeks of leaving their original post.
But the Liberal Democrat consumer affairs spokesman, Mr Norman Baker, said that if Mr Mandelson had any "integrity and sense of right and wrong" he should pay back the money to the taxpayer.
Mr Baker told The Irish Times: "I don't agree with severance pay to ministers in principle. Legally he is entitled to the money but this is a question of integrity."
On the day Mr Mandelson resigned he received a letter from Mr Blair, indicating that a return to office had not been ruled out and saying that the MP would "achieve much, much more with us". Mr Baker said that a severance payment when it was clear that Mr Blair's government intended to bring Mr Mandelson back into office was an odd situation: "His job is the job he was elected to do as an MP. I doubt if there should be any severance payments and if income comes back, then the money should come back."
He pointed out that "everybody gets an MP's salary and if they get ministerial office, that is a bonus".
"People know when they take ministerial office that they can be deprived of that at any point in their career, if they are not performing or if the prime minister has a whim to get rid of them."
Mr Baker suggested that if severance payments were to be maintained, the period of qualification should be extended beyond three weeks. "Someone could be given a quarter of their salary and be back in office after a month. The period has to be extended to a year at least."
The Prime Minister, Mr Blair, confirmed the severance payment, in a written Commons reply earlier this week, in which he said there was no requirement for Mr Mandelson to repay the money.
Mr Mandelson left the Cabinet in December 1998 when it was revealed that he had accepted a loan from the then paymaster-general, Mr Geoffrey Robinson, two years earlier to help to finance the purchase of a house in Notting Hill, London. Mr Mandelson was reinstated to the Cabinet 10 months after his resignation. He has repaid the loan to Mr Robinson.