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Whether a given geographical area has two single-seat divisions or one double-seat division can affect the outcome of an election. For example, in the case of two single-seat divisions, the Conservative party might win
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one with a large majority and the Labour party the other with a small majority. That is perfectly reasonable, because there will be two clear winners of the seats, one Conservative and one Labour. In a two-seat division covering the same area, with the same votes cast, the Conservative party would win both seats. My concern is that the drawing up of such boundaries could inadvertently lead to a less representative outcome for the voters. At least, it would be inadvertent on the part of the Boundary Commission; it could be a very advertent action by those who propose a multi-member constituency. That is an unacceptable state of affairs, and the matter should be investigated carefully.

I agree that current legislation is imperfect and that changes must be made. The public must be shown that the electoral process, from funding to polling, is transparent and fair. I hope that the whole House will agree that we must be careful not to damage the current system or undermine the Electoral Commission’s position with the very Bill that is designed to increase efficiency.

7.43 pm

Tony Lloyd (Manchester, Central) (Lab): I commend the final comments of the hon. Member for Isle of Wight (Mr. Turner) that the electoral system must be seen to be transparent and fair. One of the realities behind the Bill is that that is not accepted as being the case. Each one of us, as a serving politician, has a duty to engage in dialogue to try to ensure that we deliver to the people of this country a political system in which they can have confidence.

I agree with my hon. Friend the Member for Slough (Fiona Mactaggart) that, paradoxically, even though there are things for us to consider, many people of all parties, including some whom I have known for many years, engage in party politics because they regard the political system as part of their public duty. We ought to point out that many of those people have credibility and integrity of the highest order. However, that gives us all the more reason to ensure that we have robust laws that crack down on the concerns that lead to suspicion that the political system is not as it should be.

I shall start by mentioning certain aspects of the Bill that, although they may be non-controversial, I hope can be improved as it makes its way through its various stages. There is common agreement that the Electoral Commission needs improving. Most of us have been unhappy with its work, and I certainly welcome the fact that we are relaxing the limitations on those who can actively serve on it. We probably also need to consider the £200 spending limit that appears in the Bill, because there is concern in all parties that that does not reflect reality and will be an impediment not to those who wish to transgress spending rules but to those who are engaged in proper and acceptable politics.

I hope that my hon. Friend the Minister will take account of the concerns that have been raised about the concept of entry-and-search powers. I agree with the hon. Member for Isle of Wight that if things are so serious that entry and search are necessary, it probably ought to be the police who perform that function rather than the Electoral Commission. I do not wish to trivialise the matter, but there is something Monty Pythonesque, Spanish inquisition style, about the Electoral Commission
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entering somebody’s home. It ought not to happen to people engaged in the proper activity of party politics at local or any other level.

I wish to say a few words about the trigger. I am astonished that the Liberal Democrats seem to have switched their position on it entirely. It seems to me to be a rare occasion when their principles and expediency are pulling them in the wrong direction. Both principle and expediency ought to lie on the side of having the trigger, so they should consider carefully why they have come to their conclusions about it.

I should like an even stronger trigger, and the concept of introducing a local trigger is important. As my hon. Friend the Member for Battersea (Martin Linton) said, there should be no ambiguity about the debate that occurred some years ago in the House of Lords. It was entirely about the giving of reassurances that the trigger would remain in operation. That was the only reason why Lord Mackay, speaking on behalf of the Conservative party, withdrew his amendment. Opposition Members need only reread that debate to realise how central that was.

I am not normally in the habit of wishing to say unkind things about other hon. Members’ speeches, but the justification that the right hon. Member for Horsham (Mr. Maude) gave in opposition to the trigger was astonishing. He said that there were many reasons for opposing it, but I think that he gave one. When the case of my erstwhile colleague Fiona Jones came to court, the difficulty was in drawing a legal distinction between what was within and without the rules, because of the narrow nature of the trigger at the time. I would prefer to see proper whole-Parliament spending limits locally. I say to my hon. Friend the Member for Battersea that I would like it to be separate at national level, as there is an important distinction between the two. Nevertheless, whole-Parliament spending limits make an awful lot of sense. The right hon. Member for Horsham gave no proper reason why the Conservative party opposes them, other than expediency.

Martin Linton: The point about having a single limit on both national and local spending, as in Canada, is that the national limit—£20 million in this case—would be divided between each constituency and act as a constituency limit as well. That would prevent people from finding any loopholes by juggling money from one limit to the other.

Tony Lloyd: I understand that point, but in this Bill we will probably not be engaged in fine-tuning it, so perhaps it is for another occasion. We disagree on it, but we can return to it privately. The important point is that among the limited number of justifications given by the right hon. Member for Horsham and by one or two of his Conservative colleagues was the suggestion that by reintroducing the trigger we are being unfair to candidates. Electoral law and electoral practice are not about candidates; they are about the integrity of the electoral system and being fair to the electorate.

That touches on the nature of where our political system is going. A short debate took place earlier about the arms race. Hayden Phillips’s report “Strengthening Democracy: Fair and Sustainable Funding of Political Parties” states:

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There is no doubt that a political arms race takes place in every electoral cycle, and it matters not whether the absolute volumes increase election by election—the constant trend has been upwards.

Mr. Tyrie: The hon. Gentleman has correctly quoted from Sir Hayden Phillips’s report. I participated throughout these negotiations, and can tell him that Sir Hayden commissioned a paper on the arms race that drew pretty much the same conclusions as the Pinto-Duschinsky work and that Conservative Members have asked for it to be published. That work was commissioned after Sir Hayden’s first report had been published, and I am reasonably confident that he would not have come to the same conclusions had it already been before him.

Tony Lloyd: I have heard the hon. Gentleman make that point before, but he is wrong on two grounds. First, it is a question not only of whether there is an absolute increase in the volume of spending, electoral cycle over electoral cycle; it is also about what takes place within the electoral cycle. We have seen a number of consequences in how we fund party politics, one of which is that we bunch the spending into the last dash for growth at national level, and that, in itself, is not necessarily a healthy part of the democratic process. Secondly, there has been a consequence at local level: a massive concentration of intense spending. In some constituencies, candidates are outspending their opponents by factors of eight to one. That might be a matter of party difference, but anyone who examines this matter objectively can see that it is not healthy for the body politic.

The arms race exists at national level between the parties over different parts of the electoral cycle and it is intense at local level. Increasingly, our elections are no longer about democratic choice among the whole population; things are concentrated on those who live in the marginal seats deemed to influence elections. My hon. Friend the Member for Battersea mentioned Lord Ashcroft’s claim that 25 of the 33 seats that changed hands were among the 41 on which he spent money, and that shows, as he himself concluded, that money perhaps begins to talk. That is a dangerous and unhealthy trend.

I wish to spend a few moments discussing that kind of spending. The American experience tells us that the correlation between high spending levels and campaigning is that high levels of spending are increasingly associated with negative campaigning; it is not about the positive establishment and advocacy of ideas, values and policies, but about doing down the other—that applies at local level in particular. Local campaigning is in grave danger of being turned entirely into that form of negative campaigning, and that would be a disaster for our political process.

All hon. Members ought to take that point seriously and question where we are going. The plethora of funding structures that make that situation possible might be advantageous for individuals—I am in a happy position, because neither Lord Ashcroft nor the golfing associations would be interested in my seat and that perhaps gives me a sense of relaxation personally—but constituents, including mine, are entitled to dynamic politics fought by all political parties at local level. I do
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not take for granted constituents who are not in those marginal seats; nor should anybody else, including my party.

Adam Afriyie: I have been listening carefully to the hon. Gentleman’s remarks, and he is developing the interesting theme that the level of money may make a clear difference to the outcome. Will he also comment on the amount of money paid to his party candidates by the trade unions, because in many cases it is higher than the donations that he has mentioned? Secondly, where does the communications allowance figure in his deliberations? It provides a considerable sum over a four or five-year Parliament that would appear to aid the incumbent.

Tony Lloyd: Let us put this matter into context. I am told that in some constituencies Conservative candidates are spending in the order of £50,000 or more a year on local campaigns.

Adam Afriyie: And Labour candidates.

Tony Lloyd: I would love to be able to tell the hon. Gentleman that the rich trade union members provide such sums—I have been a lifelong trade unionist, and I am proud of my associations with the trade unions, particularly the Labour-affiliated ones—but that dwarfs anything that the trade unions put into any constituency by enormous volumes. There is no comparison in the figures involved.

On the communications allowance, the hon. Gentleman need only do the mathematics to work things out. Conservative Members also benefit from the communications allowance, but it has a very different structure. The fundamental difference is that as long as hon. Members on both sides are confined to using the rules of this House, the communications allowance is restricted to that communication in which any Member of Parliament can engage as a Member of this House without reference to party politics. That is not the same thing as the constant drive of party politics that is being fed through things such as the golfing associations, the Ashcroft moneys and the unincorporated associations from which Conservative Members obtain such benefit.

We perhaps also need to address another difference, which poses a real challenge to every Conservative Member. Anybody can look at the accounts of my constituency party or that of any Labour Member to see exactly what money went in and from what source, be that trade unions or otherwise. I talked to the general secretary of the Labour party tonight, and he told me that the Labour party must ensure that it is seen to honour both the letter and the spirit of this legislation. What is not clear is whether Conservative Members want to honour that same letter or that same spirit.

Conservative Members will know, as I do, of the allegations made in “Dispatches” and in The Sunday Times that the route from Stargate Holdings, a Belizean company, through to Bearwood Corporate Services Ltd has been used to channel moneys into our political system to work outside the impact of our legal framework. That raises questions that ought to be answered by the Electoral Commission, by those who investigate such allegations of unacceptable activity and by the Conservative party if it is genuine in wanting to operate within the spirit and the letter of the law. This is not just about beggar-thy-neighbour politics; it is about genuinely wanting to offer the British public clean and transparent politics.

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I am aware that other hon. Members wish to speak, but I wish to make some further points. Real questions remain as to whether Lord Ashcroft is a registered elector in this country. He has said that he was a major donor to the Conservative party when the Political Parties, Elections and Referendums Act 2000 was in operation, and questions remain as to whether he was a permissible donor and whether the Conservative party’s stewardship was such as to ensure that the moneys going into the party were proper and acceptable. Those questions must be answered.

I have met and worked with many Conservatives, both when I was a local councillor and even here in Parliament. They are people of the utmost integrity, and I would never wish to suggest that being a member of the Conservative party, of itself, is anything other than being about the highest sense of public service and duty. When these allegations are made about our own parties—my party has had to face such allegations in the past—each of us must see whether the activities are consistent with proper and decent transparent politics. On that basis, I would say to this House that there is a long way to go.

7.59 pm

Sir George Young (North-West Hampshire) (Con): It is a pleasure to follow the hon. Member for Manchester, Central (Tony Lloyd), who made a thoughtful speech, and I agreed with what he said at the beginning about regulation and the powers of entry. However, I am afraid that I did not agree with him on clause 10 and the trigger mechanism. The Secretary of State for Justice can normally be relied on to make a robust defence of whatever proposition he is putting to the House, but when he reached clause 10 in his speech today he was extraordinarily defensive, with an over-reliance on an Opposition amendment tabled 10 years ago in the other place. Any objective listener to the debate will have found the counter-arguments, put first by my right hon. Friend the Member for Horsham (Mr. Maude), very powerful. He holed clause 10 below the waterline. Before the smoke had settled, there came another torpedo from the hon. Member for Cambridge (David Howarth), headed the same way. I shall be amazed if clause 10 survives its passage through both Houses in the form in which it is currently drafted.

My right hon. Friend put on the table a genuine offer that would deal with the Lord Ashcroft issue. We would be happy to discuss a cap on donations of £50,000. If the hon. Member for Manchester, Central and his colleagues are worried, that is an offer that should be pursued, because it would address some of their concerns.

I agree with the Secretary of State that the regime introduced by the 2000 Act has, on the whole, worked fairly well, setting up the Electoral Commission and introducing controls on parties and elections. However, since its introduction, a range of committees has considered it—the Hayden Phillips committee, the Constitutional Affairs Committee, the Committee on Standards in Public Life and, of course, the Electoral Commission itself. The time has come to make some running repairs to the 2000 Act. Some of the recommendations from those bodies are included in the Bill, but some are not.

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I begin with a word of warning about the Government’s approach to matters dealing with elections. Party advantage has not always been erased from their mind. When the original legislation went through, I was my party’s spokesman on these matters and I recall that one key recommendation of the Neill Committee was not in the Bill: the principle of match funding to encourage party membership. The absence of that recommendation caused the Government much difficulty with the Bill in the other place. Since then, that recommendation has been repeated by several bodies. At the time, its omission was seen as partisan because it would have benefited the Conservative party. The alibi that that was unaffordable was destroyed by the Government’s subsequent munificence in almost every field of public expenditure. I mention that in the context of today’s debate because the Government have form in seeking to tweak electoral legislation for party advantage, and we need to be clear to prevent it from happening with this Bill. My right hon. Friend put down some markers in that respect, and I am sure that the other place is on red alert.

I wish to speak briefly on two issues, the first of which relates to clause 5 and putting politicians on the Electoral Commission. The commission has made it clear that it does not like that suggestion. It has said:

That is seriously overplaying its hand. If four of the 10 commissioners were put forward by the leaders of the political parties, it would enhance the credibility and effectiveness of the commission, rather than contaminate its independence. I have met many of the commissioners, and they did not strike me as people who would be walked over by politicians and of course they would remain a majority. Nor is it the case that politicians are always partisan. Anyone who has been a Minister or a Chairman of a Select Committee will realise that politicians are perfectly able to switch to neutral mode. If I may say so, Madam Deputy Speaker, the Deputy Speakers are good examples of that. They are elected with a party hat, but they serve the House impartially and neutrally.

The Committee on Standards in Public Life has representatives of the political parties, and I have seen no evidence that people think it less independent because there are two MPs on it. My Committee has powers to make recommendations, and although it is composed solely of party politicians coming from four different parties, I do not believe that that has compromised its effectiveness or credibility. So I believe that the anxieties expressed by the commission on that score are misguided.

My second point relates to clauses 2 and 3, coupled with schedule 1. I apologise to the hon. Member for Cambridge, because this is an internal matter for the House. The clauses will extend the investigative powers of the commission considerably, and Members of Parliament will be subject to the new provisions. This part of the Bill is relevant to the ongoing debate about how best to resolve the current requirement on colleagues to register certain interests both with the Registrar of Members’ Interests here and with the Electoral Commission. How do the proposals to extend the investigatory powers of the commission and their
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application to MPs fit the provisions of section 59 of the Electoral Administration Act 2006, which has not yet been brought into effect?

When the 2000 Act was introduced, nobody spotted that it introduced two parallel reporting regimes for MPs, and that has caused much confusion. Colleagues who have registered their interests on the register here and whose entries are accessible online are now getting letters in some cases from the Electoral Commission saying that they have committed a criminal offence because they have not also registered the identical item with it. That is absurd, but it is what the law currently requires. That is why the House, after full consultation with the Electoral Commission, passed section 59 of the Electoral Administration Act 2006 which, in a nutshell, would introduce a one-stop shop for MPs in respect of the vast majority of what are called “permissible donations”. We would register our interests here, and the commission would get the information it required for its registers from us, streamlining and simplifying the process without compromising on transparency.

Section 59 cannot be enacted without a commencement order laid by the Secretary of State. There is real pressure from both sides of the House to get on with this. The issue is central to assessing the impact that the proposals in the Bill will have on hon. Members, and other holders of “relevant elective office”. In practice, once section 59 is commenced, MPs will remain subject to the overall legislation on donations, but would be relieved of the personal obligation to report each recordable donation we receive to the Electoral Commission as well as the register. Consequently, we will no longer be at risk of committing the criminal offences that can arise from a failure to comply in full with the statutory requirements. As such donations make up the overwhelming bulk of donations that Members report to the commission, the decision on commencement is of considerable significance when looking at the potential impact of this Bill on the House.

So, what is the Government’s policy on commencement of section 59, which they put on the statute book two years ago? The Secretary of State wrote to me in August, saying:

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