HOW SHOULD THE FUND AND INDIVIDUAL
DONATIONS HAVE BEEN REGISTERED?
49. As I have pointed out above[23],
Categories 4, 5 and 10 are potentially relevant to this case.
In the following paragraphs, I examine each in turn to establish
where the Fund, and the individual donations, might most appropriately
be registered in the light of my conclusion in the preceding paragraph.
50. It is clear on the facts that, if the donations
were to be seen as sponsorship, and thus in principle registrable
under Category 4, Mr Galloway did not need to register them as
none of the individual donations to the Fund reached the threshold
of more than £1,000 which could have rendered them registrable
in this category. Even if they had passed this threshold, this
would not in my view have been the appropriate category as its
primary purpose is to ensure the registration of donations made
to Members either as candidates or in support of their parliamentary
role. As paragraph 27 of the Guide to the Rules notes:
"Any contribution for the personal benefit
of a Member should be entered under Category 5 (Gifts, benefits
and hospitality (UK))."
51. Category 5 differs from Category 4 as to its
purpose and in a number of other respects, two of which are particularly
relevant to this case. First the threshold for registration is
lower, being any gift of a value greater than 1% of the current
parliamentary salary: in 2003, this was £550; currently it
is £590. Secondly, the obligation to register relates to:
"any gift. or material benefit, of a value greater than
1 percent of the current parliamentary salary…which in
any way relates to membership of the House" (emphasis
added).
52. The scope of a gift for the purpose of registration
under Category 5 is widely drawn. As paragraph 28 of the Rules
makes clear, it covers both tangible gifts and other benefits,
including "relief from indebtedness", as previously
noted, and "loan concessions".
53. On the information provided by Mr Galloway and
his legal advisers, four individual donations made to his Legal
Fund significantly exceeded the threshold which would have rendered
them registrable under category 5, if they met the requirements
for registration in all other respects. I have set out above why
I believe that they did meet those requirements. They were certainly
gifts (in that they were given without any firm expectation that
they would be returned); they were of material benefit to Mr Galloway;
and because Mr Galloway's public reputation (which embraced his
reputation as a Member) was at the heart of the libel case, they
were gifts or benefits which related to his membership of the
House.
54. Paragraph 34 of the Guide to the Rules gives
valuable guidance on how to apply the test as to whether a gift
or material benefit relates to membership of the House. It states:
"Gifts and material benefits in this Category
(and other Categories) are exempt from registration if they do
not relate in any way to membership of the House. The extent to
which this exemption applies in any particular case is necessarily
a matter of judgement. Both the possible motive of the giver and
the use to which the gift is put have to be considered: if it
is clear on both counts that the gift or benefit is entirely unrelated
to membership of the House, or would not reasonably be thought
by others to be so related, it need not be registered. If there
is any doubt it should be registered."
55. Adopting this approach, I am in no doubt that
the four individual donations to Mr Galloway's Legal Fund which
exceeded the then threshold of £550 should have been registered
under Category 5.
56. Where should the existence of the Fund itself
have been registered? The Committee on Standards and Privileges
has not previously considered the general question whether funds
of this size and kind should be registered under Category 5. It
has, however, considered the question of registration of general
funds under Category 4 and has resolved that, where individual
donations exceed the relevant threshold for registration, both
those individual donations and the fund itself should be registered.
57. The Committee may wish to consider, in the context
of its planned review of the Guide to the Rules relating to the
Conduct of Members (due to be undertaken later this year), whether
it would be appropriate to adopt a similar approach in relation
to Category 5 as to Category 4. Any such decision could not, of
course, apply to Mr Galloway retrospectively. I conclude that
the complaint against Mr Galloway in respect of the registration
of the Fund as a whole cannot be upheld on the basis that he should
have registered its existence under Category 5.
58. I have already indicated, however, that I believe
that, approaching the matter from first principles, the Fund itself
met the tests for registration (as set out in paragraph 31 above).
If not in Category 5, where should the Fund itself have been registered?
59. The answer, I submit, is in Category 10. This
is the category specifically provided to catch any relevant interest
not falling within any other category which nevertheless falls
within the definition of the main purpose of the Register. I have
set out above why I believe the Legal Fund was an interest falling
within the definition of the main purpose of the Register. As
such, if it was not registrable in any other, more specific, category,
the Legal Fund was in my view registrable under Category 10.
60. This case sets an important precedent. It is
perfectly possible to conceive of other circumstances in which
a Member involved in a criminal or civil action linked to their
political activities would be assisted in meeting his or her legal
costs by a 'defence fund' set up by supporters. There are also
other circumstances in which a Member might establish a fund for
a particular purpose from which they derived a material benefit.
It would be odd if the mere fact that no individual donation to
the fund exceeded the threshold for registration as a gift meant
that the fund itself—which, taken as a whole, could constitute
a substantial material benefit—did not need to be registered.
61. Bearing in mind the overall purpose of the Register,
I believe that such funds (whether or not any individual donation
exceeds the threshold for registration under Category 5) should
be registered under Category 10 if they meet the definitional
requirement, unless the Committee were, at some future point,
to decide to extend the scope of Category 5 to include them.
62. For the reasons I have set out, I conclude
that Mr Galloway should have registered in 2003:
a) In Category 5, the names of the four donors
whose gifts to his Legal Fund exceeded the then threshold for
registration under this category; and
b) In Category 10, the existence of the Legal
Fund itself.
63. On these grounds, I recommend that Mr Crossey's
complaint should be upheld.
20 April 2006 Sir Philip Mawer
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