The parliamentary expenses scandal has provoked outrage all over Britain in the last few weeks.

We have learned that it is possible to spend £1,645 on a floating duck house – which apparently the ducks did not even like (perhaps a plasma screen TV would have helped?) – and to waste hundreds of pounds on hundreds of tonnes of manure.

The extent of row means that we should not be surprised to find that social housing has become involved. AsInside Housing reported on 8 May, the Sunday Times found that Baroness Uddin bought a fl at in Maidstone in 2005 and told the House of Lords that it was her main residence.

This allowed her to claim £29,675 a year to cover the cost of staying in London to attend debates, as well as £11,868 for subsistence. In addition, she claimed £13,197 in office costs, but the location of that office has not been made public. And all along Baroness Uddin had a social housing property in east London.

Let us be quite clear about two things. Baroness Uddin’s behaviour appears to have been entirely within the rules. But – as the comments posted on Inside Housing’s website make clear – it is also beyond the pale.

The peer seems to have acquired the Maidstone fl at with the intention of claiming that her long-standing London property was her second home.

At least a handful of other London-resident peers appear to have acquired property outside London like this, but frequency does not lessen the extent to which this behaviour is essentially dishonest.

Baroness Uddin makes a considerable profit from the arrangement. Unlike in the House of Commons, the House of Lords’ rules allow peers to claim a fl at rate per night, so any peer lucky enough to have a low rent social housing property – or to own a property outright – can indeed make a (tax free) fortune and remain inside the rules.

But those rules were clearly never designed to allow people to make a profit of tens of thousands of pounds a year, and to use them like this will fail in what Harriet Harman, leader of the Commons, has called ‘the court of public opinion’.

Nor does it appear that Baroness Uddin has breached her social housing contract.  

She has a joint tenancy with her husband and as long as he never lives in the Maidstone property, their continued occupation of the east London home is within the rules laid down by the Housing Act 1988.

Now, if her husband lived in social housing in Glasgow and worked nearby we would understand why Baroness Uddin needed to live apart from him for her work in the Lords.

But she appears to be in the bizarre position of claiming to live apart from him in Maidstone whenever possible (since Maidstone is her main home) but to live with him when she needs to be in London. What a strange relationship that appears to be!

Yet, for all this, there is a bigger scandal, which is that Baroness Uddin is living in social housing at all.

She has proven that she is rich enough to buy her own home, and she received £55,732 tax free last year in House of Lords’ allowances.

Furthermore, unlike MPs, as a peer she essentially has a job for life – and so allowances for life. She is in the top 5 per cent of British income distribution. And yet she remains in social housing, depriving a family who, if they are at the top of the housing needs register in Britain in 2009, must be in real need of a home.

Quite remarkably, Inside Housing reports that Baroness Uddin’s last question in the House of Lords was on housing and homelessness in east London.

She asked: ‘My Lords, does my noble friend accept that our policy on homeless families impacts greatly on those who are waiting on the list?’

She then went on to question Baroness Andrews on whether she was ‘aware’ that about 25,000 families were on the waiting list in east London.

Indeed, Baroness Uddin, there is a very long waiting list for housing in east London. To continue to live in social housing yourself while professing to care about homelessness makes you a hypocrite. Nothing more and nothing less.

Baroness Uddin does not have to face the voters. We have no ability to tell her and others like her what we think of people who are rich by any definition of the word, yet stay in social housing and claim to be concerned about families with real housing needs stuck on apparently endless waiting lists. Baroness Uddin is a Labour peer.

The Labour Party can decide whether she is a fit and proper person to represent them in the House of Lords, or whether she is instead a hypocrite who plays the system for all it is worth, and is unworthy of everything the party stands for. The decent thing would be for the baroness to pay back the past expenses and to resign her social housing tenancy.

If she is not prepared to do this the Labour Party has a choice: it can back her or sack her.

Harold Wilson famously remarked that the Labour Party ‘is a moral crusade or it is nothing’. The decision it makes will tell us whether the Labour Party of 2009 is indeed a moral crusade, or whether it is, in fact, nothing.

And although we, the people, do not get the chance to vote on Baroness Uddin’s future, we will get to vote in the next year on whether Labour should remain in office.

Dr Tim Leunig is an academic in the economic history department at the London School of Economics. His only expenses are a complimentary copy of Inside Housing and one fish and chip lunch with the commissioning editor