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John Mann (Bassetlaw) (Lab): Before my right hon. Friend presumes an overall consensus on blaming the Electoral Commission, may I ask whether a bad craftsman blames his tools? Is not the core weakness of the Electoral Commission in applying the principles of both Neill and Nolan that the law that it has in front of it is in some examples far too strong but in others far too weak? Transparency is therefore not possible because the commission does not have the right balance of powers to do what Nolan and Neill wanted it to do.

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Mr. Straw: Both factors are involved. The Committee on Standards in Public Life used exactly the same adjectives as my hon. Friend; it said that it was too weak in some areas and too strong in others. The issue is partly to do with its powers. Far from strengthening the total powers of the commission, this Bill qualifies powers and provides additional but more sensible powers. Another factor has been the nature of the commission and the fact that individuals with recent political experience have not served on it. The Committee on Standards in Public Life and the Constitutional Affairs Committee both recommended that a minority of commissioners should have practical experience from across the political spectrum. Those bipartisan reviews also recommended that the commission’s regulatory role should be clarified, that its investigatory powers should be changed and that it should be given a flexible range of civil sanctions to enable it to consider alternative avenues in cases where breaches have occurred and where the only options at present—this is a part-answer to my right hon. Friend the Member for Rotherham (Mr. MacShane)—are to name and shame or to refer the matter to the Crown Prosecution Service or the police with a view to a criminal prosecution. The Bill takes forward all those proposals, and I shall come to their detail in a moment. There is already all-party consensus on these changes in principle, and relevant measures are included in the Bill. However, I hope that through the process of parliamentary scrutiny we can carefully examine them and improve their detailed operation where necessary.

In addition to reform of the Electoral Commission, the Bill contains important measures to ensure that the true source of donations to political parties is made known to the public. All parties have called for openness and transparency in party funding, so I hope that these measures will secure all-party support as well. It has been a common aim of all legislation, going right back to 1883, that overall spending by parties should be controlled. While of course there may be argument about exactly how to control it, that common aim continues to be shared by the parties. I entirely agree with the hon. Member for Arundel and South Downs (Nick Herbert), who said last year that

The Bill therefore includes measures to improve the control of spending. Although there are strong arguments in favour of a comprehensive overhaul of the system of expenditure controls—to pick up on a point made by Liberal Democrats—and Sir Hayden recommended the introduction of what amounted to continuous all-encompassing spending caps, it is clear that there is not currently consensus on taking such a step. Consequently, I have not included those proposals in the Bill.

Mr. Brian H. Donohoe (Central Ayrshire) (Lab): How did my right hon. Friend come to the conclusion that the level at which a donation can be declared should be reduced from £1,000 to £200? Why does not he take it down to zero, given that there will be problems under the Freedom of Information Act 2000 if he does not do so?

Mr. Straw: First, political parties are not defined as public authorities for the purposes of the Freedom of Information Act and therefore do not have to cope with
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FOI requests—thankfully, because they would not have the apparatus to do so. Secondly, we have received representations from all the main parties and some of the smaller parties asking for the £200 limit to be raised and for the burden of that provision to be made lighter rather than more difficult.

Instead of comprehensive, continuous, all-encompassing spending caps, the Bill tackles one of several weaknesses in the existing controls—the absence of any controls on spending that takes place outside the official election period at a local or candidate level. The Bill proposes a return to the principle of the pre-2000 system known as “triggering”, which will ensure that all expenditure for the purposes of a candidate’s election is regulated. I hope that that will command the same level of support as it did before 2000. During the passage of the Political Parties, Elections and Referendums Act 2000, as the White Paper that I published last June indicates, a Conservative spokesman in the Lords, Lord Mackay of Ardbrecknish, moved a “belt and braces” amendment to put the continuation of the trigger beyond doubt. His amendments were withdrawn only on ministerial assurances, sadly not because experience had shown that they were not necessary.

Mr. Andrew Tyrie (Chichester) (Con): Much of the right hon. Gentleman’s speech has been about the need for consensus. On the need for consultation, where in the Hayden Phillips proposals, or indeed anywhere else, has the proposal on triggering been discussed or consulted on?

Mr. Straw: There was self-evidently a consensus up to and including the passage of the 2000 Act. Everybody believed that the trigger arrangements in the Representation of the People Act 1983 would continue through the passage and implementation of the Act. That is clear beyond peradventure. Lord Neill said that his proposals were designed to buttress the arrangements in the 1983 Act. That was also the view of both Ministers and the Conservative Opposition. Indeed, I regret the fact that we did not accept the amendment from the late Lord Mackay.

Secondly, Sir Hayden Phillips refers on page 15 of his report to the concerns, which were expressed by some parties but not others, about the lacunae, as it were, in the current arrangements. He says that he takes such concerns seriously, discusses how to deal with them and then says:

If we had found a consensus in favour of comprehensive and continuous spending caps, the trigger would not be necessary. However, I suggest to the House—I hope that we can achieve a consensus on this—that the trigger is necessary and appropriate. I do not for the life of me understand quite why it should arouse such controversy, given that everybody accepted that it was there before.

Mr. Alan Reid (Argyll and Bute) (LD): I think that “Ardbrecknish” was the place name in my constituency that the Lord Chancellor was trying to pronounce.

The Lord Chancellor started by referring to the fact that political campaigns had become more national. One of the flaws in the Bill, however, is that it contains
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absolutely nothing that would prevent a political party from deluging a marginal constituency with literature, telephone calls and newspaper adverts urging people to vote for the party, as long as the candidate’s name was not mentioned.

Mr. Straw: I have dealt with why we have not been able to move forward with those proposals. The trigger arrangements, which have been a feature of electoral law since 1883 and were repeated in the 1983 legislation, did not totally control spending at the local level before a general election, but they did have a dampening effect. Like me, many hon. Members were candidates before the 2000 Act came into force, and the advice to candidates, which again is recited in the Library note, was that we had to concentrate on expounding on our parties’ policies, not on the merits of candidates, which did dampen expenditure.

Mr. Francis Maude (Horsham) (Con): Let me deal with the ingenious concept that the Justice Secretary has just introduced—that there was a consensus before 2000 that the old triggering arrangements were wonderful and should be retained. Why, then, was there a consensus in the 2000 Act that they should be abolished? He talks about the amendments that Lord Mackay tabled in the other place, but will he acknowledge that they were explicitly described by Lord Mackay as probing amendments and promptly withdrawn?

Mr. Straw: I am very happy to provide the right hon. Gentleman with the exact quotations between now and the winding-up speeches, but it was never the purpose of either Lord Neill or the then Home Secretary, who happened to be me, that the provisions in what became the 2000 Act should replace the triggering. Everybody thought that the drafting of what became the 2000 Act would complement and supplement the 1983 Act, except in one or two particulars, and not be an alternative to it, and that is a matter of record.

David Howarth rose—

Tony Lloyd (Manchester, Central) (Lab) rose—

Mr. Straw: I need to make some progress.

Mr. Tyrie: It is quite extraordinary for the Justice Secretary to suggest that there was a consensus that the rules should stay and that they somehow evaporated into thin air. On the contrary, Lord Bach turned down the proposal in Lord Mackay’s probing amendment by saying that “this new formulation”—that is, what the Government introduced—

It is to those provisions that the Justice Secretary intends to return.

Mr. Straw: I know that Lord Bach said that, but the basis of what he said is not what the hon. Gentleman says it is. I am very happy for this to be dealt with in greater detail in the winding-up speeches, but everybody believed that what was in the 1983 Act would continue. Lord Neill’s report was quite explicit that what became the 2000 Act should buttress what was in the 1983 Act.

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Tony Lloyd: I do not think that the observations made across the Floor have been very helpful. My own memory is quite clear: Lord Mackay withdrew his amendments because he was assured that the trigger would remain in place. It was on that basis that there was all-party consensus. Our noble Friend Lord Bach attempted to reassure Lord Mackay that the trigger would remain, but he was wrong. On the basis of those assurances, Lord Mackay withdrew his amendments. There was absolute consensus on the trigger at that point.

Mr. Straw: My hon. Friend is entirely correct, and that is what the record shows, too.

Let me turn briefly to the detail of the Bill. Clause 1 clarifies the Electoral Commission’s regulatory role to make it clear that a key part of its role is to take appropriate steps to secure the compliance of parties and others, including by helping parties to comply, especially given that parties rely so much on unpaid volunteers. The clause also enables the commission to publish guidance to assist parties and others in this respect.

Clause 2 and schedule 1 change the commission’s investigatory powers. They repeat, with minor changes, the commission’s current power to require political parties and other regulated entities to disclose information relating to finance and expenditure, and for the first time enable it to compel anyone else to disclose or provide information or an explanation, where that is reasonably required for the purpose of investigating a suspected event or contravention of a requirement in the Act. The scope and proportionality of these powers will be examined in detail in Committee, but it is worth pointing out—this relates to the point raised by my right hon. Friend the Member for Rotherham—that the Bill contains important safeguards on the use of these powers, which go beyond those in the Political Parties, Elections and Referendums Act 2000. They include the provision that the powers of entry require a warrant from a court on evidence of a reasonable belief that a criminal offence has been committed. That is not required under the existing schedule 19. In any event, the existing powers have been used only once since the Electoral Commission was established nearly eight years ago.

Sir Patrick Cormack (South Staffordshire) (Con): I would like to echo what the right hon. Member for Rotherham (Mr. MacShane) said a few minutes ago. There are many of us, in all parts of the House, who believe that the powers are far too strong, and that they will allow people to invade the privacy of homes and political offices. There is not even absolute clarity that House of Commons Officers will be immune from this sort of raid. I hope that the Lord Chancellor will listen carefully when these issues are debated in Committee and in the other place, and that he will be willing to accept amendments in respect of them.

Mr. Straw: I am certainly willing for these matters to be looked at in great detail, but it is worth pointing out that there are already a large number of such powers in the 2000 Act. One area of the Bill seeks to broaden those powers so that the Electoral Commission can obtain an order against any other person as well as against a political party. However, the use of those
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powers, whomever they are used against, will have to be made through a court, which is not the case at the moment.

Mr. MacShane: Will my right hon. Friend give way?

Mr. Straw: I want to make some progress, if I may.

Up to now, the Electoral Commission has faced a genuine dilemma, given the powers available to it: either reprimand or reference to the police, but nothing in between. Clause 3 and schedule 2 give the Electoral Commission access to a flexible range of civil sanctions that may be imposed in relation to certain offences and contraventions under the 2000 Act. The schedule sets out the range of new civil penalties available to the commission, when the commission is able to apply those sanctions, to whom they apply and what appeal processes are available to an individual or organisation subject to a sanction. Which of the offences in the 2000 Act will attract civil sanctions will be set out in secondary legislation. I want to give a reassurance to my right hon. Friend the Member for Rotherham that when a civil penalty is applied by the Electoral Commission, no criminal prosecution can be instituted. That provision appears in paragraph 4 of schedule 2 to the Bill. In practice, therefore, the provision reduces the scope for criminal reference, rather than increasing it.

Clause 4 provides that each person proposed for appointment as an electoral commissioner must be selected in accordance with a procedure put in place and overseen by the Speaker’s Committee on the Electoral Commission. This makes it clear that responsibility for the oversight of the recruitment and selection process remains with the Speaker’s Committee.

Clause 5 enables the appointment of four commissioners with recent political experience. Clause 6 increases the minimum number of electoral commissioners that may be appointed, and clause 7 reduces the time period for restrictions on past political activity for Electoral Commission staff. We have gone rather further than the Committee on Standards in Public Life proposed, but I think we have done so in a sensible direction.

Clause 8 is designed to increase the transparency of political donations by requiring donors giving above a limit—currently £200 in the Bill—to a political party to declare whether the money is its own. If it has received a sum above the limit

the making of the donation, it must declare that to be the case and go on to declare whether it believes that certain sections of the Act apply. Those provisions supplement the existing requirements of the 2000 Act by making it clear that the identities of the true donor, on whose behalf the donation is made, must be given to the recipient of the donation. If a donor declares that those sections of the 2000 Act do not apply, they must explain why.

Mr. Walker rose—

Mr. Straw: I am afraid that I am about to conclude.

Making a false declaration about any of those aspects will be a criminal offence.

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Mr. Rob Wilson (Reading, East) (Con) rose—

Mr. Straw: As I said, I am about to finish.

I should say—I referred to it earlier—that representations have been received from a number of parties that the £200 limit is too low, and we also received wider representations about the impact of clause 8 on those charged with complying with the law. Although I am clear that greater transparency is essential, it should not be achieved at the cost of overburdening political parties and I am ready to consider representations on the detail of our proposals in that area.

Nick Herbert (Arundel and South Downs) (Con): Will the right hon. Gentleman give way?

Mr. Straw: I will, of course, give way to the hon. Gentleman, who is on the Front Bench.

Nick Herbert: I am grateful. Before the right hon. Gentleman finishes, will he explain why the Bill says almost nothing about electoral fraud? Five years ago, the Electoral Commission recommended individual voter registration and it has repeatedly done so. Four years ago, the Government said that they accepted it or were at least sympathetic to the principle, so why has nothing happened in the intervening period?

Mr. Straw: It is not the case that nothing has happened. Indeed, a great deal of work is going on in respect of the matter. By the same token, if, as we hear, the Conservative party is interested in forming a consensus, we need it not just on individual registration, but— [Interruption.] It is not just about the principle, but about how it will work. We are considering proposals, and, for example, the experience of Northern Ireland, which saw a substantial drop in registration. We need to reflect on that experience and much else besides, including in countries such as Australia, before proceeding.

Mr. Philip Dunne (Ludlow) (Con): Will the right hon. Gentleman give way?

Mr. Straw: No, I am about to conclude.

Clause 9 helps to lift and partly remove an unfair burden in the 2000 Act by clarifying that, if a party or treasurer is charged with the offence of accepting an impermissible donation, they will not be guilty if they can show that they took all reasonable steps to verify that the donation was from a permissible donor. That was always the intention underlying the 2000 Act; the Bill makes a technical change to put that point beyond any doubt.

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