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Lorely Burt (Solihull) (LD): Can the Secretary of State clarify the role of the Electoral Commission? Clarity would be appreciated on the extent to which the commission will be able to check political parties' compliance with the requirements on donations, whether it will be asked to give an opinion on the extent to which political parties are observing those requirements and what it is to do if it believes that one or more political parties have failed to comply with the law.

Mr. Hain: I can, as I will explain, give the hon. Lady a positive response to the questions she has asked. The Electoral Commission will be involved in detail on all that. Indeed, it plays a pivotal role. The chairman, Sam Younger, is content with the arrangements we have described.

For the reason I have just given, the Bill will require Northern Ireland parties, for the first time, to comply with the rules set out under the Political Parties, Elections and Referendums Act 2000, which require donations over a certain amount to be declared to the Electoral Commission. However, to take account of the continuing concerns about the possibility of donor intimidation in Northern Ireland, for a transitional period, donations to Northern Ireland parties will be checked privately by the Electoral Commission. If the commission discovers that a donation has been unlawfully accepted, the donation will be made public. That period will run from November 2007 and pave the way for full transition to complete transparency, as in the rest of the UK, in October 2010, which remains the Government's goal.

Lady Hermon: Will the Secretary of State kindly elaborate on where he thinks that intimidation of legitimate and proper donors will come from, given that the IRA has given up its criminality and its weapons and done all the business, as we were told repeatedly last year? How can he stand there and justify the fact that donations will be kept private and secret right up until 2010? Where will the intimidation come from?

Mr. Hain: Concerns were expressed to me—not particularly in relation to the IRA, but generally—about the climate in Northern Ireland's political culture, because there has not been the openness to which we
 
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have become accustomed since we legislated to change the matter after we came to power. There has not been such openness to the same extent in Northern Ireland, so there was therefore a concern, as part of the consultation, that we should allow a period of transition for normalisation to settle in. It was not any particular paramilitary organisation that was a particular concern; it could have been any party or any individual.

Mr. Wallace: Does the Secretary of State accept that there is a principle incorporated in the Bill that will change significantly our relationship in that the rules on donations will also reflect changes in Irish legislation? No matter what the Irish Dail does, that will kick into the rules affecting parties in Northern Ireland and we will be powerless to change that unless we introduce primary legislation to follow the Bill up.

Mr. Hain: Not for the first time in being generous in taking interventions, a point that I was about to deal with has been raised, but may I make another point in relation to intimidation and the transitional period in general? This will allow the political parties in Northern Ireland to adjust to the new arrangements and become accustomed to them, rather than them simply kicking in late next year. A period of transition will be allowed for that to occur. That is right, and it came out of the consultation period.

The other major effect of these reforms will be to apply to Northern Ireland parties the ban on foreign donations that operates under the 2000 Act. However, to recognise the special position of the Republic of Ireland in relation to Northern Ireland's political culture, Irish citizens and other bodies will continue to be able to donate to Northern Ireland political parties, as defined by Irish law. That is consistent with the principles of the Good Friday agreement and reflects the unique relationship between Northern Ireland and the Republic.

Mr. Nigel Dodds (Belfast, North) (DUP): Does the Secretary of State accept that that provision will be seen, and is seen widely in Northern Ireland, as simply a benefit clause for Sinn Fein? Will he think again before inserting an exemption for foreign donors that is aimed specifically at assisting the republican movement in its fundraising efforts in America and elsewhere?

Mr. Hain: That is not the only issue, if it is an issue at all. Not only Sinn Fein was concerned with the issue. I think that this is a sensible step and I am sure that everyone will agree.

Clause 23, the decommissioning clause, is intended to take the peace process a step further. The full decommissioning of IRA weapons, independently verified, was of course welcome and highly significant, but there is more to be done. We want to see all loyalist weapons decommissioned, and also those of dissident republicans. The Bill will ensure that the amnesty scheme stays in place for a further three years to facilitate that process.

The Bill is not just about the political process. It contains important provisions on energy that are designed to help to put Northern Ireland on a new footing by creating a single wholesale electricity market
 
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on the island of Ireland. Compelling market-led arguments resulted in similar action in 2003 to enable the Scottish market to be integrated with the England-Wales wholesale electricity market. Now it is Northern Ireland's turn. The electricity industry and the business community in Northern Ireland support the move, for the simple reason that a single market makes sound economic sense. It will be both more sustainable and more liable to attract new investment. It is expected that the single market will bring consumer benefits by boosting economies of scale and creating fuel savings. Together with access to a larger marketplace, that should spur greater competition and provide for a more efficient pricing mechanism. Crucially, the new market will bring enhanced security and diversity of electricity supplies.

Renewable sources offer a further outstanding opportunity to secure our energy supply, while protecting our environment. That is particularly important for Northern Ireland, where more than 99 per cent. of our primary energy requirements come from imported fossil fuels. That is a worrying level of reliance in economic and environmental terms, and in terms of security of supply. Increasing sustainability is not just an option but an imperative. Developing renewable energy and renewable technologies offers us a way forward and we must grasp it with a sense of urgency.

Last month, I launched a £59 million package of assistance aimed at enhancing and accelerating the development and deployment of renewables in Northern Ireland. It is an initiative in which the public sector will lead by example and in which everyone will have a part to play, with the potential to lever in hundreds of millions of pounds in private investment. The Bill will enable that package of assistance to be effectively targeted at a wide range of renewable energy initiatives that will be critical to a more sustainable energy future for Northern Ireland.

Clause 24 increases the threshold on the amount that the Northern Ireland Executive can borrow from the national loans fund, in effect extending the Executive's overdraft limit. In particular, that will facilitate the massive increase in infrastructure investment that I announced in December.

Clause 27 and schedule 3 extend to Northern Ireland the provisions in the Serious Organised Crime and Police Act 2005 relating to the investigatory powers of the Director of Public Prosecutions. The purpose is to provide powers in investigations of serious offences that are undertaken in Northern Ireland equivalent to those available in the rest of the United Kingdom. The provisions will enable prosecutors and investigators to compel witnesses to provide information in serious organised investigations of matters that might otherwise have proved difficult to uncover. The creation of those new powers for Northern Ireland will give investigators and prosecutors additional weapons with which to tackle the major ongoing problem of serious organised crime on a UK-wide basis.

Clause 28 will provide corporation sole status to the office of the Chief Constable of the Police Service of Northern Ireland. It will extend to Northern Ireland arrangements similar to those that already exist for chief police officers in Great Britain, so that any prosecution
 
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relating to breaches of health and safety at work legislation will ordinarily be brought against the office of the Chief Constable, rather than against the individual office holder.

Clause 29 will place a duty on relevant Ministers to fill judicial vacancies in Northern Ireland, except where the Lord Chief Justice of Northern Ireland agrees that a particular vacancy may remain unfilled. That will bring Northern Ireland into line with the arrangements put in place for England and Wales in the Constitutional Reform Act 2005. The aim is to remove any perception that Ministers could use the filling of judicial vacancies to place pressure on the judiciary and influence its independence. The change does not disturb either the current arrangements for judicial appointments or the post-devolution arrangements already provided for in the Justice (Northern Ireland) Act 2002, as amended.

The Bill's reforms will help to sustain a different and welcome environment in Northern Ireland. The IRA's historic statement of 28 July last year—ordering an end to the armed campaign and the dumping of all arms, and instructing volunteers to engage in purely political and democratic programmes through exclusively peaceful means—has been the subject of independent verification. The Independent Monitoring Commission's reports of 19 October and 1 February show that the IRA has taken a strategic decision to turn its back on the ways of the past. In its most recent report, published on 8 March, the IMC said that, in its view, the IRA has taken a strategic decision to follow a political path, that it does not present a terrorist threat and that it is not a threat to members of the security forces.

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