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Presiding over record homelessness, rising rents and house prices far outstripping the average wage, MPs are exposed as pocketing huge sums from selling taxpayer-subsidised homes.

Prime Ministerial hopeful Michael Gove is among MPs named in reports today (April 10) as having made a collective £42m in profit from such sales – and under Parliamentary rules they are entitled to keep the money.

Gove, touted as the next Tory leader, is said to have made £870,000 on two homes.

Already, Sir Alistair Graham, former chairman of the Committee of Standards in Public Life has said such profit should not be made when the money was to help MPs meet their public ­responsibilities.

“You should not be profiting out of special taxpayer funds, you should repay any gain you made over that period,” said Sir Graham.

“The arrangement was made purely to take into account MPs who came from the North who would struggle to meet the housing costs.

“It would need to be carefully ­calculated but Independent ­Parliamentary Standards Authority has done this before and they can do it again – I don’t think anything will restore trust, it’s at such a low ebb, but it’s the right thing to do,” he said.

The investigation by the Daily Mirror found MPs made an average profit of £255,000 on selling their taxpayer-subsidised homes, while millions of voters struggle to even get on the housing ladder.

Of the 20 who have made more than £500,000 in gross profit, 14 are Tories and six Labour.

Fourteen MPs have sold not one but two of these properties.

Labour MPs were making an average of £193,000 profit on the sales but Tories made twice this each, averaging £417,000.

Until 2010, MPs – except those with seats in inner London – were allowed to claim up to £24,000 a year for a second home under the controversial Additional Costs Allowance in a system intended to allow MPs from all over the country to have a home near the Commons, but also live in their constituencies.

After the expenses scandal, the system was overhauled so taxpayers no longer footed the bill for mortgages of MPs who now can claim up to £22,760 in rent for a second home.

But MPs who had already bought their homes were allowed to keep them, plus any profits from the sale – and in London, the average London house price has rocketed from £149,543 to £479,920.

The investigation hints at even greater profits than those we have unearthed.

If the MPs still designated the ­property as their second home when they sold up they would have had to pay capital gains tax on the profits.

And some will have paid any ­mortgage themselves in full while they were not in parliament or after the rules changed banning the claims.

The investigation found three MPs – all Labour – who made a loss on their transactions.