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Mr. Tipping: The hon. Gentleman asks me to ponder, and I shall do that. I have listened consistently to the Committee's views. The hon. Member for West Derbyshire (Mr. McLoughlin) chastised me earlier for accepting amendments and thus making changes to the Bill. I believe that that is a sign of strength, not weakness.

In a previous intervention, the hon. Member for South Holland and The Deepings (Mr. Hayes) was vexed by the European Union. He suggested a scenario in which the European Union secretly funded clandestine organisations throughout the United Kingdom in a referendum campaign, I dare say about the euro. That stretches a hypothesis beyond the pale.

Mr. Graham Brady (Altrincham and Sale, West) rose--

Mr. Hayes rose--

Mr. Tipping: I shall not revert to the subject of the European Union. I appreciate that it excites Opposition Members. We had a good opportunity to discuss the European Union earlier.

The hon. Member for North Dorset (Mr. Walker) asked why the figure was set at £10,000 and invited me to reflect on it. I have been reminded that the Neill committee suggested £25,000. I am delighted that the right hon. Member for South Norfolk (Mr. MacGregor), who was a distinguished member of the Neill committee, will be able to participate in the debate. The Government have reduced the figure that the committee suggested. As I said, I shall ponder the matter.

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The hon. Member for North Dorset gave me an example to consider. He presented the notion of an advertisement that was circulated by friends and supporters of an organisation. It is difficult to comment on hypothetical circumstances, but the organisation in his example seemed to be an unincorporated body by another name. If that was the case, the commission would want to examine the matter and perhaps involve the police and bring a prosecution. However, I do not claim that there is no scope for avoidance and evasion.

8 pm

Mr. Swayne: The clause is interesting in that it creates an offence in respect of persons or bodies that are not permitted participants and spend more than £10,000 to influence a campaign. I hope that the Minister will say whether such persons or bodies might indeed include the European Union, of which we have spoken. If not, why not? Will he therefore consider tabling an amendment on Report to make it so?

Mr. Tipping: Conservative Members tabled amendments on that point, but did not bother to turn up to move them.

Mr. Swayne: All the more reason for the Minister to consider such a move, given the expression of concern he has heard this evening--although he said that he regards our concerns as pure fantasy. I wonder what world he lives in. He spoke of the EU secretly funding a campaign. There is no question of secrecy; it is doing so openly.

I draw to the Minister's attention the fact that we held such a referendum in 1975, so our concerns are not fantasy and such referendums occur in the real world. At the beginning of the campaign, there was a 2:1 lead in the opinion polls for withdrawing from what was then the Common Market. By its end, albeit on a low turnout, the vote was 2:1 in favour of staying in. The strength of the argument or the wisdom of the British people might have achieved that result, but I cannot help but think that it had something to do with the fact that the no campaign was outspent by the yes campaign by 20:1.

Even if our concerns are fantasy and there is no prospect whatever of such a body as the EU spending money secretly or openly, what possible problem can there be with making such provision in the Bill? If that is unlikely to happen, the Minister will lose nothing, but he will gain everything by assuaging the concern, which is not restricted to Conservative Members, but is rife in the country. That is what his spin doctors would call a win-win situation. I invite him to take his opportunity.

Mr. Hayes: The Minister and I go back a long way and he well knows that I am neither paranoid nor extreme about anything. I am a terribly mild, moderate and reasonable chap, so the last thing in the world that he would want to do is give the false impression that my position is anything less than calm, cool and collected. To correct him, I did not mention the European Union in my intervention; I talked about commercial organisations and multinational companies that might take an interest in funding referendum campaigns. To be absolutely precise,

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my paranoia--if there is any paranoia at all, and I do not think there is--is more about international capitalism than the European Commission.

Mr. Tipping: That is a reflection of the change in the political agendas across the parties.

Mr. Hayes: It is more a reflection of the moderate broad church that is the Conservative party.

The Minister criticised Conservative Members for not moving amendments dealing specifically with the point made by my hon. Friend the Member for New Forest, West (Mr. Swayne) and said that if we felt so strongly we should, at this stage, have moved amendments that would have tightened up the Bill in respect of our particular concerns and fears, but he said also that the Bill is enabling legislation and freely acknowledged that, in the event of a specific referendum campaign at a particular time--many euphemisms have been used, but we all know the spectre that many of us fear--additional legislation specific to those circumstances would be needed. Surely, he cannot have it both ways.

My contention is that, at this stage, we need to set the tone, broadcast the signals and lay the foundations, which the Minister rightly said would be built on when we faced a particular referendum at an indeterminate time in the future. However, if those foundations are of an entirely different making from the building that is required later, there is little sense in arguing that we can construct a good building on shaky, insecure or inappropriate foundations, because that building will not be appropriate for an occasion that may or may not arise either later in this Parliament or in the next.

We must lay foundations that clearly and starkly signal--in the House and more widely--our intentions, assumptions and presuppositions about the conduct of future campaigns and how they are to be supported and funded. I am profoundly concerned that we are changing the nature of campaigning and the funding of campaigns. The Minister and I share a love of robust, honest and frank exchanges of views and a civilised concern that those matters should be dealt with in the right way. I emphasise that I know that from the previous life that we shared. [Hon. Members: "Oh!"] Is not it a pity that Hansard does not record irony?

I am sure that the Minister also shares my desire that referendums and general election campaigns should be conducted, as far as possible, in a spirit of fairness, openness and honesty. The funding of those campaigns is fundamentally important to that fairness and that spirit. I believe, therefore, that these measures will concern decent democrats on both sides of the House--Labour Members as much as Conservative Members--not because they share the same views on what side they might take in a future and so far unspecified referendum, but because they would want that referendum to have a degree of legitimacy. Legitimacy is based on fairness, openness and honesty in terms of funding and the nature of campaigning. I am most concerned that we are missing an opportunity to lay the appropriate foundations on which we could construct a building of which we could all be justly proud.

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Mr. John MacGregor (South Norfolk): I had not intended to speak, but the Minister referred to the Neill committee and I was its only member from the House of Commons. I may not have heard everything he said, but I realised that he was not addressing the point made by my hon. Friend the Member for North Dorset (Mr. Walter) about penalties. As he knows, the Neill committee recommended a limit of £25,000, not in relation to expenditure--we recommended against that and we shall come to it in a moment--but in relation to becoming a registered party and therefore having to observe all the requirements on donations and so on. We now find that there is a limit on expenditure as well, so someone who spends more than £10,000 will be caught on that, too.

I am worried about lowering the limit, which takes me beyond the clause to schedule 19. I said on Second Reading that I was anxious about the enormous number of offences that would apply to breaches of the clause. All of us on the Neill committee knew that it would be difficult to persuade some people of calibre to be treasurers in such circumstances. That applies to political parties more generally, not just to referendums. To be faced with this horrendous list of offences is a further disincentive to people to take on that role.

This problem applies acutely to the clause, because £10,000 is not a high expenditure figure when one is trying to put across a point of view. If someone inadvertently exceeded the £10,000 limit, they would, on indictment, be subject to a fine or one year's imprisonment. That is excessive for someone who may inadvertently breach that low limit. I do not think I heard the Minister refer to that point in his response to my hon. Friend the Member for North Dorset, and I should be grateful if he would address it because it is relevant if we are to lower the limit from £25,000 to £10,000.

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