Select Committee on Standards and Privileges Seventh Report


APPENDIX

Complaint against Mr Ken Livingstone MP

THE COMPLAINT

1.    Mr John Jones, of Shepshed, Leicestershire, wrote to me on 19 December 1999 (Annex A) drawing my attention to two alleged breaches by Mr Ken Livingstone, Member for Brent East, of the Rules for the Registration of Members' Interests:

    (i)  that as a speaker for a company which hires people for events and after dinner speeches, Speakers for Business, Mr Livingstone had been receiving regular payments for parliamentary services of "up to £1600" for each event and had not registered this income;

    (ii)  that he had not registered either the source or proportion of income which he had received for services as a Member of Parliament and which had been paid to his company, Localaction Ltd.

REGISTER ENTRIES

2.    Since his election in 1987, Mr Livingstone has consistently registered his directorship of Localaction Ltd, which he described as a "company formed to cover the publication of my books, Socialist Economic Bulletin and other writing and media work". In September 1996, on the one occasion he received a dividend from Localaction Ltd, he also registered his shareholding of more than 1% of its issued share capital.

REGISTRATION REQUIREMENTS

3.    Since the inception of the Register in 1975 Members have been required to register all sources of remunerated employment, though not the sums received. The Guide to the Rules relating to the Conduct of Members provides (para 16) the following guidance:

    "When registering employment, Members should not simply state the employer company and the nature of its business, but should also indicate the nature of the post which they hold in the company or the services for which the company remunerates them."

4.    From November 1995 a Member engaging in outside employment "which involves the provision of services in the capacity as a Member of Parliament" has been required to deposit with the Commissioner for Standards a written agreement, which would be available for public inspection, including figures for remuneration in bands of (i) up to £1000 (ii) £1001-£5000 (iii) £5,001-£10,000, and thereafter in bands of £5000. These figures are published against the entry in the Register.

5.    The Guide to the Rules gives the following guidance (para. 36, quoting para. 41 of the Second Report of the Select Committee on Standards in Public Life):

    "The new requirement for employment agreements to be put in writing will apply principally to any arrangement whereby a Member may offer advice about parliamentary matters. We think it right, however, that it should also include frequent, as opposed to merely occasional, commitments outside Parliament which arise directly from membership of the House. For example, a regular, paid newspaper column or television programme would have to be the subject of a written agreement, but ad hoc current affairs or news interviews or intermittent panel appearances would not."

BACKGROUND

6.    In 1996 Mr Livingstone approached the then Commissioner for advice on the application of the new rule to Localation Ltd. He confirmed that, apart from a regular commitment to lecture on politics to overseas students at Richmond College, the American International University in London (for which he deposited an employment agreement, and which has since been discontinued) "my other activities are all one-off after dinner speeches or articles for papers. Nothing is on a regular basis". On the basis of that information, the then Commissioner accepted that Mr Livingstone did not need to deposit other employment agreements (Annex B).

7.    On 22 December 1999, I wrote to Mr Livingstone asking him (i) how regularly he carried out speaking engagements for Speakers for Business (ii) whether these related to parliamentary or public affairs (iii) what was the normal payment for such a speech (iv) what was his income from this source in the last financial year.

MR LIVINGSTONE'S RESPONSE

8.    Mr Livingstone told me that he undertook speaking engagements for about half a dozen agencies and a column on public affairs for The Independent, all relating to Parliament, and that he writes a restaurant column for the Evening Standard. Fees from all these sources are paid to Localaction Ltd.

9.    He wrote to me on 10 February 2000 (Annex C) and provided me with a breakdown of the income of £94,963 received by Localaction Ltd from 30 June 1998 and 30 June 1999, which included the following bodies from whom he received remuneration on more than one occasion:


Evening Standard for seven columns £14,549
Independent for ten columns £11,550
Prime Performers for six speeches £9,286
Speakers for Business for three speeches £7,518
Interphiz for four speeches £6,643
Commercial Casting for two speeches £4,090
Norman Phillips for two speeches £3,040
Right Address for two speeches £3,040



10.  Mr Livingstone told me that his speaking engagements had continued at a similar rate for a similar set of companies until the end of 1999, and he later provided me with a similar breakdown from July 1999-February 2000. This showed that, within the total of £126,029 for this period, he had received a further £18,108 from the Evening Standard, £12,250 from The Independent, £1617 from Prime Performers for one speech, £29,387 from Speakers for Business for at least seven speeches, £1500 from Interphiz for one speech, £1540 from Norman Phillips for one speech and £1786 from Right Address for one speech. In addition, over the complete period from 30 June 1998 to 29 February 2000, he had been paid £12,514 by JLA for five speeches, £9368 from CSA for five speeches and £10,813 by Diana Boulter for four speeches.

ANALYSIS AND CONCLUSIONS

11.  The Rules make it clear that all sources of paid employment outside the House must be registered and no distinction is made between payments made directly to Members and fees received by companies on their behalf. Members are not required to disclose the rate of remuneration in most instances. This is only necessary when the employment "involves the provision of services in the capacity as a Member of Parliament". Members are required to specify the services for which they are remunerated.

12.  Between June 1998 and 1999 Mr Livingstone carried out 36 speaking engagements, including 28 on behalf of a variety of agencies for each of which he was paid a minimum of £1500. While his description of Localaction Ltd in the Register includes "writing and media work", it does not mention lectures or speeches. In my view, Mr Livingstone's entry should have included such information and his current Register entry is therefore deficient.

13.  Mr Livingstone believed that, having cleared his Register entry with the then Commissioner in 1996, it was still in accordance with the Rules. However analysis of the payments made to Localaction Ltd between June 1998 and June 1999 demonstrates that the rule on employment agreements applies to a number of his regular commitments, including his regular public affairs column for The Independent.

14.  While his individual speeches are given to different audiences and are in that sense one-off activities, his remunerated employment with at least four agencies, Speakers for Business, Prime Performers, Interphiz and Right Address is regular and therefore brings him within this requirement. He has accepted my advice that all these sources of income need to be registered separately with a clear description of their activities and that he must deposit an employment agreement showing his annual remuneration in the appropriate band.

15.  Mr Livingstone is not required to deposit an employment agreement for his restaurant column in the Evening Standard because its subject matter "is wholly unrelated to parliamentary or public affairs". As a major source of earnings, however, it requires a separate entry in the Register.

MATTER FOR CONSIDERATION

16.  The Committee may wish to consider whether, in cases of this kind, any more detailed disclosure is required.

17.  The main purpose of the Register is "to provide information of any pecuniary interest or other material benefit which a Member receives which might reasonably be thought by others to influence his or her actions, speeches or votes in Parliament, or actions taken in his or her capacity as a Member of Parliament." Such influence could equally well be exercised by a body which is willing to pay a Member a substantial fee for a speaking engagement as by the provider of any other form of employment or benefit.

18.  While the Rules specify the financial thresholds above which gifts, benefits and hospitality must be registered, no such figure is set for the registration of remuneration for employment.

19.  While some Members list each of their speaking engagements in the Register, the majority submit general entries such as "occasional fees for newspaper articles, broadcasting appearances, lectures etc", which give no indication of the income from these activities or the bodies providing the remuneration.

20.  As most Members are asked from time to time to carry out remunerated speaking engagements, my office has always taken the view that it would be unreasonable to expect every occasion to be registered individually when the fee is small. If asked for advice, we have taken the main purpose of the Register as our guide and recommended that, when fees of £500 or more are received, either singly or cumulatively, from a single source, both the event and the source should be specified in the Register; but there is no written guidance in the Guide to the Rules. The Committee may take the view that some written guidance on this point would be helpful to Members.

21.  Though most Members include income from newspaper articles, speeches etc as remunerated employment (in category 2 of the Register), Mr Livingstone's earnings from these sources are paid to his company. Detailed information about the individual providers of his fees could alternatively be entered as clients (in category 3), which requires Members who are directors of companies to register "any provision to clients of services which depend essentially upon, or arise out of, the Member's position as a Member of Parliament."

CONCLUSIONS

22.  I uphold the following components of Mr Jones' complaint:

    (i)  Mr Livingstone should have made a comprehensive entry in the Register to cover all the services he provides through Localaction.

    (ii)  Although the Rules for Members do not require Mr Livingstone to give the total remuneration he receives for his services in his capacity as a Member of Parliament which is paid into Localaction, they do require him to register, in appropriate bands, the remuneration which he receives from each company to which he regularly provides such services. He should have done so for The Independent, Prime Performers, Speakers for Business, Interphiz, JLA, CSA, Diana Boulter and probably for Norman Phillips and Right Address.

    (iii)  Mr Livingstone was also required to deposit with my office employment agreements with these employers from the point at which he began to provide these services regularly.

    (iv)  Mr Livingstone should have made a separate Register entry for his Evening Standard column.

8 March 2000  
Elizabeth Filkin


 
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