Appendix 2: Letter of 21 November 2005
to the Chairman from the Minister of State, Department for Constitutional
Affairs
Further to my letter to you of the 14 October, we
have been making progress on drafting an amendment to Schedule
7 of the Political Parties, Elections and Referendums Act 2000
(PPERA) to remove the current duplication of reporting requirements
in respect of political donations. My officials have been working
with both the Registrar of Members' Interests and the Electoral
Commission in developing our proposals to ensure that, while providing
a welcome practical reform for Members, the key principles of
transparency and accountability underlying the current regulatory
regime are maintained. They have also been considering the details
of how the new system will need to work in order to maintain these
principles.
Having considered a range of options, the Government
intends to bring forward an amendment which will remove the requirement
for Members of Parliament to report recordable donations to the
Electoral Commission. Similar amendments will also be made to
the regulatory system for other holders of elective office as
set out in PPERA. These are MEPs, Members of devolved administrations
and local councillors. For technical reasons, it will be necessary
to retain the requirement for the Electoral Commission to record
details of such donations on its register, and the Commission
will continue to monitor compliance with the regulatory system
as set out in PPERA.
Removal of the requirement for Members to report
recordable donations themselves to the Electoral Commission raises
the question as to how best the Commission would in future obtain
the information it needs to discharge its statutory obligations
in this respect. Much of this is already required to be provided
to the Registrar of Members' Interests, and is published in the
Register. However, there are a small number of circumstances in
which information relating to activities which constitute 'donations'
for the purposes of PPERA is not required at present to be reported
to the Registrar for inclusion in the Register. There are also
some respects in which the reporting requirements the House has
set for the Register of Members' Interests are more stringent
than those currently in place under PPERA. For example, the threshold
for reporting gifts, benefits and overseas visits to the Register
of Members' interests is set at 1% of the Parliamentary salary,
currently £590, whereas the threshold set out in PPERA for
recordable donations is £1,000.
I believe the best way forward is to build on the
House's existing registration arrangements, and for the Electoral
Commission to gather the information it needs through these. This
would meet the 'one stop shop' objective. The simplest way forward,
in administrative terms, would be for the House to decide to include
henceforth in the Register the additional information at present
required to be supplied to the Electoral Commission. The Commission
could then simply meet their obligations by drawing on the information
in it.
Such a solution would maintain transparency and accountability,
and also end the potential for confusion caused by the differing
requirements of the House, on the one hand, and PPERA, on the
other. It is important to stress, though, that it would mean no
overall increase in the information that Members were required
to make public.
Discussions between my officials, the Registrar of
Members' Interests and the Electoral Commission suggest that the
areas in which additional information would be required include:
- the precise amount of cash
donations exceeding the £1,000 threshold that would need
to be declared, and the date on which they were received; and
- certain non-cash donations currently reportable
to Electoral Commission but not required to be included in Register
entries that would need to be declared, the dates they were received,
and their actual or notional value.
As I said earlier, the Government would wish the
key principles of transparency and accountability to be retained.
We therefore intend to provide for the removal of the requirement
for Members to report donations to the Electoral Commission only
to come into effect when the Electoral Commission is satisfied
that alternative arrangements have been put in place for it to
be able to access the information it needs.
I will share the draft amendment with you as soon
as we have a suitable text. The intention is to table it in time
for it be considered at Committee. However, there are still technical
issues which need resolving, including a devolution issue with
Scotland which we are still exploring.
I would like to thank you once again for your Committee's
work on this and indeed many other important issues, and underline
our commitment to the governing principles underlying the regulatory
system.
21 November 2005 Rt Hon Harriet Harman QC
MP
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