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Ms Abbott: As it happens, I have a copy of the list of the top 100 employers in the City in front of me, and it is true that the Crown Prosecution Service employs 600 people. Under the terms of the new clause that my hon. Friend is debating so ably, the CPS would not have a voice, yet sleazy institutions such as Arthur Andersen and all types of foreign-owned companies would.

John McDonnell: That is why I am deeply suspicious of the new clause. I am deeply suspicious of any organisation that seeks to promote a wide-ranging amendment to exclude from any dealings that it has with the outside world the very organisations that have the expertise to root out fraud and corruption, criminal activities, financial mismanagement and economic incompetence. I would have thought that any organisation would welcome the participation of those Government agencies.

Phil Sawford: My hon. Friend referred to the special report from the Committee, on which I served. The report says:

"the electoral system within the City of London is flawed in a manner and to an extent which could not be addressed within the powers of the Bill presented."

Does he think that the amendments make the Bill any better? He referred to the numbers of votes that the Bank of England and the CPS would have. We learned in

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Committee of three wards with no electors at all, so 69 votes could represent a bigger swing than I had in Kettering.

John McDonnell: I would not like to delve into the politics of Kettering, apart from commending the voters' good sense in electing my hon. Friend.

The Committee was not alerted to the fact that excluding such bodies means that expertise within the City of London boundaries would be excluded from participation in the good governance of the City of London corporation.

Mr. Dismore: In his list of the bodies involved in enforcement, my hon. Friend missed out the judges in the Old Bailey and the other law courts in the City. The courts are very important institutions, and we all know how many City spivs have ended up in front of a judge at the Old Bailey. Does my hon. Friend agree that judges should also have a part to play?

John McDonnell: My hon. Friend and I clearly have differing views of judges and their ability. I am not sure whether the City of London corporation would benefit from the involvement of Old Bailey judges.

Andrew Mackinlay: Could my hon. Friend or the Minister throw any light on this point? I see that the Bill's promoter is not in the Chamber. [Interruption.] Mea culpa, mea culpa, mea maxima culpa. The right hon. Member for North-West Hampshire (Sir G. Young) crossed the Bar of the House a moment ago.

I have read and re-read the new clause, which says:

"A government department or other body exercising on behalf of the Crown functions conferred by or under any Act shall not be treated as a qualifying body".

It appears that most of those employers, albeit private companies, have had conferred on them by an Act duties and responsibilities that they are fulfilling on behalf of the Crown. Perhaps the right hon. Gentleman can help, because that is nonsense; the new clause is sloppily drafted. A lot of people who think that they will get a vote will not if new clause 1 is accepted.

John McDonnell: My hon. Friend is about 20 pages ahead of me. I will come to that point in due course. This is a poor draft. The previous draft had some relevance because it was based on rateable value. Because the redrafting has been left to the last minute, it is very poor, and I would sack the parliamentary agents responsible.

There is a contrast between the City of London corporation excluding certain bodies yet being desperately keen to extend to others a massive number of votes. It is a disgrace. We have mentioned some of those who will gain if the new clause is accepted. There is a lack of balance. Certain bodies that could root out fraud and corruption would be excluded while others, including Arthur Andersen and Barings, which have been associated with unacceptable practices, would be given additional votes. I am staggered that firms would be extended wider voting rights or could maintain existing voting rights while bodies that are legally respected and supported in many ways by the Government and both sides of the House for their probity would be excluded.

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8.15 pm

Sir George Young: The hon. Gentleman will be relieved to hear that the Bank of England would not be excluded under new clause 1.

John McDonnell: That is interesting. The import of the report was that it would be excluded. That makes the draft even worse. Are we saying that the Bank of England is not a

"body exercising on behalf of the Crown functions conferred by or under any Act"?

The Bank of England is formally constituted; it exercises functions under the Bank of England Act 1998. I think that the right hon. Gentleman is seeking to confuse the House because that is inaccurate, although he may not be doing so deliberately. I ask him, because he has introduced such an element of confusion into the debate, to withdraw the Bill, seek legal advice and publish it. I say that with the greatest respect because we all hold him in deep affection—[Interruption.] All right, affection. Our confidence in him as an interpreter of legislation has been undermined by that statement. I am amazed that he should tell me that the Bank of England is not a

"body exercising on behalf of the Crown functions conferred by or under any Act".

I am happy to seek legal opinion on that statement, to be paid for by the City of London corporation.

Mr. Alan Simpson (Nottingham, South): At some stage, I hope that my hon. Friend will reflect on the verification of the numbers ascribed to each of the major employers in the City of London. It is difficult to know where those numbers were conjured up from. The Labour party has had its own experience of verification of the block vote being an important aspect of democratic accountability. We are in danger of seeing the reintroduction of the block vote, in this case for the City of London.

Madam Deputy Speaker: Order. Mr. John McDonnell.

John McDonnell: I invite my hon. Friend to expand on that point at a later date, because it is an invaluable contribution to the debate.

Under the old clause, exclusion was based on property or rateable value—the hereditament—as against the qualifying body status based on the definition of a body corporate or an unincorporated body other than a partnership. Is the new clause superfluous? I am unsure whether a Department can be defined as a body corporate or an unincorporated body. Perhaps the right hon. Member for North–West Hampshire will clarify that point. It may be relevant and required if we are seeking to bar from qualifying body status all those bodies and agencies that exercise functions on behalf of the Crown but that are not Departments. There is a breadth in the new clause. In passing, I wish that we could amend the legislation by referring to Government functions rather than Crown functions, which are a Bagehotian fiction.

The complexity that exists today in defining the scope of Crown exclusions, which has never existed in the past, arises from the reform, over several decades, of how Government perform their functions. The complexity, which has ensnared the new clause, is based on the devolution of Government functions to agencies and other

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bodies, including private companies. That is the point that my hon. Friend the Member for Thurrock (Andrew Mackinlay) raised. Government is no longer so simple that we can draft a new clause that is all-encompassing yet at the same time restrictive.

Mr. Hopkins: I have a very simple approach to words—I read what they say. The new clause refers to

"exercising on behalf of the Crown functions conferred by or under any Act".

Some four years ago, along with other right hon. and hon. Members, I voted through the Bank of England Act 1998. It conferred specific responsibilities on the Bank of England in relation to interest rates and inflation. I cannot see how that can be separated from the new clause.

John McDonnell: May I refresh my hon. Friend's memory? I think that we voted against the measure.

The new clause would exclude any body from exercising functions allocated by the Crown under legislation. The delivery of Government functions is complex and I shall offer some examples that might be caught by the provision.

Mr. Dismore: Before my hon. Friend gives those examples, may I ask him to speculate on the case of people who work for London Underground? The legislation on London Underground is incredibly complex and is something of a moveable feast, depending on whether the public-private partnership goes ahead, whether the company should be transferred to Transport for London or whether it retains its current status— in effect as a Government function. Will London Underground workers move in and out of the franchise?

John McDonnell: That is a good point. It relates to one of my two examples—the other is Railtrack. The case of London Underground is more complex because of the nature of the public-private partnership that the Government want to impose on the people of London.

British Rail was established by statute and exercised its functions on behalf of the Government and would thus be caught by the provision. Railtrack is a private company but it exercises functions on behalf of the Government, so is it caught? What is Railtrack now that the Secretary of State has taken control of the company? Is it a public body or a private body? Is it caught by the provision or is it excluded?

The clause is a minefield because it is so badly drafted. Let us consider London Underground where there is that interesting moveable feast. If the PPP is established and takes over sections of the underground, the companies participating in the PPP constitute bodies corporate exercising functions on behalf of the Government under legislation and could thus argue that they are caught by the provision. However, some parts of those companies will exercise other functions—as is normal in private companies—so how much of the company will be caught by the provision?

Will workers engaged in the PPP work of a company be excluded while workers who serve other interests in the same company escape the provision and thus be

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counted in the allocation of votes for the City of London corporation? The complexities of that exclusion call for significant amendment.

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