Political Parties and Elections Bill

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Nick Ainger: I am still a little puzzled. The Minister and the Electoral Commission tell us that they are producing the guidance, so why is the requirement so onerous? If it is producing the guidance, it does not seem to be too onerous for it to do so. We being told that putting “shall” instead of “may” and creating a duty would somehow be asking far too much, and would take up far too much time. Will my right hon. Friend explain that?
5.15 pm
Mr. Wills: As I was saying, the requirements of the Act to which the measure would apply are complex and various. The guidance being produced is a matter for the commission, and it is doing what it feels is appropriate. Placing a duty on it to provide guidance on every aspect of the Act would be a different matter and would be more onerous. I hope that that answer reassures my hon. Friend.
The hon. Member for Huntingdon asked whether we have consulted the Electoral Commission. The answer is yes; we consult it frequently and will continue to do so.
Mr. Djanogly: On resources?
Mr. Wills: There has not been any formal communication with the commission about resource requirements, but we discuss all those issues with it, and will continue to do so. I hope that I have given enough reassurance for the amendments to be withdrawn.
Nick Ainger: As I have indicated to my right hon. Friend, I am still a little puzzled. The good news is that the commission is producing guidance; that is absolutely essential. We might have to return to this issue, but I shall not press the amendment.
Mr. Djanogly: Parliament is putting in place some pretty material changes here, not least in relation to the commission’s functions. The Minister has just called them complex and various, but I do not see the sense of urgency from him that this matter deserves. Electoral law has consistently fallen into abeyance in the past because of a lack of focus. That is not fair on our party workers, who will need the guidance urgently, and that is why I shall ask the Committee to divide on the amendment.
The Committee divided: Ayes 8, Noes 9.
Division No. 4]
Djanogly, Mr. Jonathan
Duddridge, James
Howarth, David
Laing, Mrs. Eleanor
Reid, Mr. Alan
Turner, Mr. Andrew
Tyrie, Mr. Andrew
Wishart, Pete
Ainger, Nick
Hesford, Stephen
Kidney, Mr. David
Linton, Martin
Lloyd, Tony
Lucas, Ian
Sharma, Mr. Virendra
Whitehead, Dr. Alan
Wills, rh Mr. Michael
Question accordingly negatived.
Question proposed, That the clause stand part of the Bill.
Mr. Djanogly: Political party funding and the organising of elections have been controversial in this country for centuries. One has only to look at a series of reports going back over the years to see that those perennial problems have presented challenges to the electoral system and political parties alike throughout history. To the extent that society changes over time, so do its expectations for electoral and funding probity, and changes then follow. However, the problem has become far more acute under the present Government.
As I said on Second Reading, this is a half-hearted Bill, which is characterised more by what is missing than by our wholesale objections to its content. We are missing an opportunity to rectify the damage and add legitimacy back into the system. We are not the only ones to think that way. A key finding of the Joseph Rowntree Reform Trust was:
“Public confidence in the electoral process in the UK was the lowest in Western Europe in 1997.”
An effective electoral system and its administration must be the foundation of our democracy. For a democracy, we need elections. Those elections cannot be free and fair unless the rules governing them are fair and coherent, and those rules must be administered properly and, if necessary, enforced actively. Party funding regulations are just as important.
Given recent experience, we agree that the regulatory framework needs strengthening. The principle, set out in clause 1, that the commission is now required to both monitor and regulate compliance has long been promoted by the Conservative party, although we will need to tie down exactly what that means. We hope that it will result in the commission doing less of what it should not be doing, such as spending millions of pounds on increasing voter turnout. That is our job as politicians, not the job of the commission. As such, we in the Conservative party cautiously accept in principle some of the proposed additions to the investigatory and sanctioning powers of the Electoral Commission, although we will want to examine more closely how they will work in practice, as we will be concerned to ensure that they do not destroy donors’ willingness to participate.
Part I of PPERA contains 21 sections and two schedules that created the commission and set out its general functions. The commission was established as a corporate body independent of any Department. Sections 5 to 13 provided it with a broad range of functions primarily in relation to the oversight of electoral matters in the UK. Its aim, in essence, is to ensure the integrity of and public confidence in the democratic process.
However, the mandate set by the Government in the legislation was unintentionally broad and ultimately far wider than originally envisaged. The commission sees its function as ranging from the regulation of political donations and expenditure by political parties through to the promotion of greater participation in the democratic process and responsibility for electoral policy review. That is a very extensive remit for a body that, according to the figures on its website, has only six commissioners, one chief executive, an executive team and an employee force of fewer than 200 people.
After the enactment of PPERA, several years passed before the problems associated with the breadth of the remit became apparent. The commission itself, in a report that it published on PPERA in 2003, queried the extent of its role and whether it had sufficient powers to ensure that there was compliance with the Act. By the start of 2007, the problem had become so acute that it was hampering the commission in its work.
The 11th report by the Committee on Standards in Public Life, entitled “Review of the Electoral Commission”, was published in January 2007 and attracted considerable press coverage. While commending the work of the commission to date, it noted rather alarmingly:
“Evidence received by the Committee strongly suggested that it has been less successful in acting as an effective and strategic regulator in a manner which ensures public trust and confidence. The root of this, from the evidence we have received, appears to lie in the Commission’s interpretation of its regulatory mandate in PPERA and, in consequence, its overly passive role.”
That criticism of a too-passive approach to its role as regulator has dogged the commission in recent years. Peter Wardle said in evidence to the CSPL:
“The legislation very much puts the onus on the parties to comply and some of the information that we need, which can trigger our investigations, does not come into our possession until such time as the parties do that under the legislation.”
For a regulatory body whose total net operating costs have exceeded £22 million for both 2006-07 and 2007-08, that is a rather depressing perspective on its role as a regulator.
Of more concern, perhaps, was that the Government seemed to support that passive role when only 18 months ago Lord Falconer stated in evidence for the same CSPL report:
“The Electoral Commission’s role, as set out by PPERA, was not to investigate. It was simply to be a recipient of information. They were in a sense exactly the same as the Register of Companies (Companies House).”
The CSPL expressed considerable surprise at the time at those comments. Will the Minister address that issue and tell us why there has been a change of approach from the Government, as welcome as it is? It is important that that is placed on the record.
The explanatory notes to the Bill indicate that the commission has estimated that the additional costs arising as a result of the changes to its powers and sanctions will amount to about £650,000 per annum. Could we please hear from the Minister how likely it is that it will be able to meet those costs from its existing budget? Details on the budget would be helpful.
Of more concern is that, once again, the Government are swinging wildly between opposing sides of the argument: from a placid commission to a full-throttled regulator with all the powers needed to enter people’s homes. I do not say that as an indication of a likely approach that I have received notice of from the commission. Rather, it is an observation of the potential held in the wording of the Bill. A lack of balance runs throughout the Bill, and I will return to it in coming debates as I attempt to highlight some of the Bill’s inconsistencies.
Our concerns focus on the tendency of the commission to travel the path of least resistance and sometimes spread itself so widely on less vital issues that it has been left wanting when faced with larger problems. I would like to take this opportunity to quote from the submission of my hon. Friend the Member for North-East Hertfordshire (Mr. Heald) to the CSPL in June 2006. It adds considerable weight to what I am saying. He stated:
“We have concerns that the Commission may have attempted to do too much, such that it has spread itself too thinly and failed to deliver on inflated expectations of what an ‘independent electoral watchdog’ should achieve. This problem of ‘mission creep’ is not unique to the Commission and has affected other public sector agencies...Although the Commission has a statutory function to review and issue reports on matters relating to elections, it has produced an excessive flurry of investigations into every single aspect of the electoral system. We are concerned that the Commission may have adopted the institutional mindset of ‘change for change’s sake’.”
I will give one more short excerpt. My hon. Friend continues:
“We would suggest that the Commission has interpreted its remit to believe that elections must be ‘modernised’ as an end in itself. RPA2000, PPERA, and successive legislation, have created an institutional instability in the electoral system.”
My hon. Friend’s comments are just as relevant today.
“In a classic example of public choice theory in action, these reviews have resulted in the conclusion that the Commission should have a bigger budget and more power. ‘The need for the Commission to take on new functions has been pressed on us...We recognise that now a central electoral body exists, there is an inevitable logic in locating certain central functions with the Commission.’ Mirroring this trend of constantly seeking to expand its role, the Commission’s expenditure has spiralled from £7 million in 2001-02 to £26 million in 2006-07.”
That has been a common feature of the commission’s performance to date. It bemoans its lack of powers, yet only 29 people have been prosecuted for crimes under PPERA. Compare that with the 400-plus cases of alleged electoral fraud that have apparently occurred in the same period, and one begins to get the impression that better utilisation of what the commission has is needed as much as more powers.
Furthermore, the commission’s predisposition—albeit somewhat reduced in recent months, it has to be said—to include itself in non-regulatory or enforcement activities such as the promotion of the electoral system and encouraging people to vote has, in the view of many, detracted significantly from its role as a guardian of the electoral system’s integrity. As my hon. Friend the Member for Chichester so accurately stated in his submission to the report of the CSPL:
“The first area where I think a mistake has probably been made was in asking the Electoral Commission to take responsibility for voter participation. I am confident, in retrospect, the majority of people think that it should not have...I think that is the responsibility of political parties. If people are not interested in politics it is our fault, primarily.”
I presume that “our” refers to politicians.
Yet that element of the commission’s work is supported by a ring-fenced £7.5 million, or some 34 per cent. of last year’s costs—more than one third of its expenditure. I believe that those figures are right, but I would appreciate it if the Minister could confirm that that is the case. The Government’s original rationale for placing this function within the remit of the commission was alarm at the continuing drop in turnout at various elections. While the reasons individuals do not vote are highly subjective, it is surely a political party issue rather than a commission one. As my hon. Friend the Member for North-East Hertfordshire the then shadow Secretary of State for Constitutional Affairs, noted in the Committee on Standards in Public Life’s report,
“I think it is an important issue, but I think someone else should be doing it”.
Even more damning is the suggestion from the CSPL that the evidence of any impact, in terms of increased turnout in elections on the back of the Commission’s work, is at best mixed and some would argue negligible.
5.30 pm
So this is the commission we find ourselves confronted with today. We accept the need for an effective commission and recognise it as a necessary and vital part of the modern electoral fabric. It is its duty to act as a watchdog of party financing and electoral administration. If we get it correct, people will have faith in the system and its integrity and we shall not undervalue the role of promoting the integrity of the system when assessing people’s propensity to vote. In other words, if I do not trust the system, why should I bother voting? That is the fundamental issue that the Government consistently shirk in the Bill, in which they continue, wrongly, to put turnout on the same level as countering fraud. The priority needs to be to refocus the commission, and that is what the amendment and new clause 1 sought to do, which is why we will be coming back to it at later stages.
What we have got, through a combination of deficiencies in the PPERA, is a mandate for the commission that is too weak in some cases and too broad in others. This has left us with an enforcement body that has fallen short of fulfilling both its potential and its important statutory duties. We will want to ponder where we have got to before the Bill is considered on Report, but I am not satisfied that we are yet where we want to be. It would be helpful if the Minister spent a little time analysing how we got to this position. Was it poor management, a poor legal structure, or a bit of both? Is he confident that the Bill, following the implementation of clause 1, is going to deal with the problem?
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