Memorandum by Richard Heller
1. This evidence is offered to the Committee
by an individual with no prospect of obtaining an honour either
by payment or merit. I hope that it will therefore be regarded
as disinterested.
2. Its prime purpose is to suggest that
the Committee look at the links between donations and honours
in the wider context of the purchase of influence in public life.
It offers the Committee a proposal for amendment of the existing
law on the purchase of honours to include the attempted purchase
or sale of public appointments, or the attempted financial procurement
of changes in public policy or actions or omissions by any public
official. It also suggests that all peers and MPs should declare
their donations or loans to any political movement, other than
ordinary membership fees.
3. The Committee might also wish to study
what internal mechanisms, if any, are employed by the parties
to scrutinize donations and loans. In the wake of the Mittalgate
affair the Labour party set up an ad hoc committee chaired by
Lord (Matthew) Evans of Temple Guiting, now a government minister.
Remarkably, Lord Levy, the party's chief fundraiser was a member,
which made him responsible for scrutinizing his own efforts. I
am not aware of any parallel initiative by other parties, but
it might be instructive for the Committee to see if they existed,
what criteria they applied and what results they achieved.
THE LAW
ON THE
SALE OF
HONOURS
4. The Committee will be aware that the
Honours scandals of Lloyd George's Coalition government from 1916
to 1922 prompted the Honours (Prevention of Abuses) Act 1925.
This made it for the first time a criminal offence to buy or sell,
or attempt to buy or sell any dignity or title of honour. To this
day only one person has ever been convicted or even charged with
an offence under the Act—the notorious honours broker Maundy
Gregory. Interestingly, Gregory was charged years after his heyday
for a particularly blatant offence when he tried to sell a knighthood
to an affronted naval commander. He pleaded guilty (to protect
his more famous clients), served a short sentence, and was pensioned
off to live in France.
5. Since Gregory's conviction in 1933 the
law has been flouted systematically with impunity. Honours have
been given regularly in exchange for political donations (officially
"for political and public service").
THE CASE
FOR A
NEW LAW
6. The sale of honours is a public mischief
which should be prevented by law. It tarnishes the sovereign,
as the fount of honour. It devalues awards to people for service
to the state. The sale of a peerage is particularly offensive,
since it confers legislative power on the purchaser (and executive
power if he or she then becomes a minister). However, recent developments
have revealed the possibility of allied and arguably more serious
dangers to public life. The Ecclestone affair suggested that donations
could be used to secure changes in public policy. The Mittalgate
affair suggested that they might be used to procure actions by
public officials—even the Prime Minister. Whether or not
these suggestions were true, they highlight the case for bringing
such matters within the ambit of the law.
7. Two other aspects of modern government
also point to the potential value of new law. The first is the
proliferation of quangos, taskforces and other advisory bodies
with an influence on public policy. Modern Prime Ministers have
an almost limitless power to appoint people to such bodies, without
any form of scrutiny. It is arguably more important to prevent
the sale of such appointments than the sale of honours, since
they confer power as well as status. The second is the growth
of organized lobbying, which is virtually unregulated except by
lobbyists themselves. The "Lobbygate affair" opened
the possibility that lobbyists would make direct offers, as in
the United States, to secure changes in public policy. A new law
could check this development without preventing people from employing
others to help make their case to government.
8. To assist the Committee's deliberations,
I have drafted a revised law based on amendment to the 1925 Act.
This is reproduced in the Appendix, with a Commentary.
9. I hope that the Committee might also
consider the merits of requiring all peers to declare substantial
donations or loans to any political cause. This would aid transparency
in public life and save researchers unnecessary labour. It would
also add a small safeguard against the creation of "soft
money" on the American model—contributions to political
causes which benefit parties without showing up in their accounts.
I think it would be right for MPs to submit themselves to the
same discipline.
16 March 2006
Appendix: The Public Life (Prevention
of Abuses) Act 2006
An Act to amend the Honours (Prevention of Abuses)
Act 1925, to make provision for the prevention of other abuses
in public life, and for connected purposes
1. If any person:
(a) accepts or obtains or agrees to accept
or attempts to obtain from any person, for himself or for any
other person, for any purpose; or
(b) gives, or agrees or proposes to give,
or offers to any person,
any gift, money or valuable consideration as an inducement
or reward for procuring or assisting or endeavouring to procure
(i) the grant of a dignity or title of honour
to any person or otherwise in connection with such a grant, or
(ii) appointment to any office of profit
under the Crown or any public appointment, or
(iii) any change in the law or public policy
for the time being in force in any part of the United Kingdom,
or
(iv) any action or omission by any person
holding an office of profit under the Crown or any public appointment,
he is guilty of an offence and liable on conviction
on indictment to imprisonment for a term not exceeding three months
or a fine not exceeding the prescribed sum, or to both; and where
the person convicted, whether on indictment or summarily, received
any such gift, money or consideration which is capable of forfeiture,
he is in addition to any other penalty liable to forfeit the same
to Her Majesty.
2. An offence under this Act may be committed
outside the United Kingdom.
Commentary
Upright passages reflect the existing wording
of the 1925 Act: italic passages are additions. New sub-clause
iii) might at first sight appear to criminalize legitimate lobbying
or advocacy. I think not. In my view it would criminalize the
suggestion of any direct link between paying money etc and changing
the law or public policy. It would also criminalize any form of
payment by results for a lobbyist, if the law is changed. It would
not criminalize the payment of money etc to secure the assistance
of any person or organization in campaigning to secure a change
in the law. If sub-clause iii) made lobbyists more cautious in
their promises and their methods, so much the better. Sub-clause
iv) creates a new offence which would be a useful supplement to
the laws on corruption of public officials. I believe that Clause
2 might plug a gap in the 1925 Act, on the assumption that a revised
Act would actually be enforced rather than fall into disuse.
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