Political Parties and Elections Bill

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Mr. Wills: Will the hon. Gentleman give way?
Mr. Tyrie: I will in a moment. I hope that I have worded that in a way that does not open up a debate that I not only suspect would be out of order—
The Chairman: It is.
Mr. Tyrie: —but would also be an unnecessary party political exchange of a type that I would like to avoid. None the less, even though we have had such a stricture in an unusual but powerful ruling from a sedentary position, I shall give way to the Minister.
Mr. Wills: I was only seeking illumination from the hon. Gentleman. Could he remind the Committee of what happened to the Hayden Phillips talks and which party withdrew from them?
The Chairman: The answer to that would be completely out of order. I am sorry, I do not often disagree with Ministers in Committee, but I do on this occasion. The hon. Member for Chichester should not deal with the question.
Mr. Tyrie: And I shall not—not even by the back door.
The Chairman: You will probably try.
Mr. Tyrie: I shall not try to, even by the back door.
I want to make one last point. There is the question of the effect on the scope of the criteria for ennoblement, which the hon. Member for Cambridge touched upon near the end of his contributions. It is true that a significant number of donors has as an incentive the idea that such preferment might come upon them one day. There are some pretty good statistics to back up that view. The hon. Gentleman mentioned one about donations in excess of £1 million to the Labour party over the past 11 years. He might have tried looking below £1 million, because the going rate is certainly well below £1 million at the moment—or it was, until the Lord Levy scandal broke.
I want to make only one more point about achieving that part of the objective. I am not sure that new clause 22, or even a hyper-improved version of it, is the way forward. The appointment to a peerage and the sense in which it is an honour need to be completely separate. A peerage should be granted entirely on the likelihood of that person making a contribution to the legislature, whether that is an appointment or, ultimately, an election—I shall not go into that. The position is part of the legislature and it should be treated as an appointment to the legislature, in which we want contributions from that individual, rather than thinking of the peerage as an honour. It should certainly not form part of patronage of any type, even of a Prime Minister.
When I wrote my proposals for reform of party funding, the Leader of the Opposition wrote the foreword and launched them at a press conference, giving warm support. For those interested, although the proposals obtained little coverage due to other issues, on page 6 the hon. Gentleman will find the solution to the problem of new clause 22 set out in detail. My right hon. Friend believes that the link between patronage and the Prime Minister should be completely broken and that those appointments should be made by an independent appointments commission.
My very last point is that the issue will not go away, even if we deal with it before the election, which is extremely unlikely. It will probably come up after the election, whoever wins. I will do whatever I can to ensure that it comes up after the election if the Conservative party wins. This area needs fundamental reform; not along the lines of new clause 22, which would have all sorts of unforeseen and unforeseeable consequences, as the hon. Gentleman admits. We have to have reform, if we are to remove what I described earlier as the stench in the nostrils of the electorate.
3 pm
Tony Lloyd: I commend new clause 22, although not every aspect is unproblematic. For example, removing Members of the House of Lords, which would be an unintended consequence of new clause 22, should not be part of our duties, but the spirit of the clause is right. The hon. Member for Chichester was a little harsh about the motivation behind it. The new clause serves a genuine purpose and there is a need to debate those devices. We can disagree about the mechanisms that ought to be allowed in our political system and the funding thereof, but we ought not to disagree about devices designed to get round clear principles that have already been established elsewhere.
One clear principle, which exists for direct donors, is that overseas residents—those prohibited from taking part in our domestic political processes—should be disbarred from funding. That is the essential import of the new clause, and, in that sense, we ought to seek something that does that. We ought to ensure that the law for corporate structures is in line with the law affecting individuals. It may not be the right mechanism, but I hope that my right hon. Friend the Minister will at least see the logic of moving in the direction that the hon. Member for Cambridge is urging.
Mr. Wills: Like most members of the Committee, we agree with the high-minded principles that we discern behind the amendment and new clause 22. However, as has already been revealed in the discussions, the new clause is, perhaps, too imperfectly drafted to secure the ends that it seeks.
Section 54(8) of the 2000 Act makes it clear that an individual on any of the following registers is entitled to donate to a UK political party: the register of parliamentary electors; the register of local government electors; the register of relevant citizens of the EU; and the register of peers made under regulations under section 3 of the Representation of the People Act 1985. The amendment would change that so that only those on the parliamentary register would be able to donate, which would prevent UK citizens living abroad and EU citizens living in the UK from donating. We do not think that a limitation of that sort is desirable, given that those categories of person have a right to vote and otherwise participate in our political system.
As we have heard, the new clause would also prevent peers from donating. Of course, it is right, in our and in most people’s view, that peers may not vote for representatives in the House of Commons, but it is not right that they should be barred from participating in the democratic process in other respects. In any event, as I have mentioned, the future reform of the House of Lords, to which everyone is committed, would make such a change inevitably anachronistic if we introduced democratically elected peers, either in whole or substantial part.
The amendment would further prevent companies owned by such individuals—that is, peers and individuals with foreign connections—from being able to donate. That would be a significant departure from the 2000 Act, under which all companies that are registered and carry on business in the UK are eligible to donate. We all understand the concerns that lie behind the amendments. It is equally clear, however, that they need to be addressed in some other context and not through the wholesale amendment of the 2000 Act to prevent any company with significant foreign connections or any company owned or controlled by a peer from being able to donate. As currently drafted, the amendments would prevent a significant number of individuals and companies with genuine connections to the United Kingdom from being able to donate, and that is not an effect that we want to achieve.
However, as the hon. Member for Cambridge made clear, and as my hon. Friend the Member for Manchester, Central and the hon. Member for Chichester said, these are important issues. The purpose of the amendment is perhaps to open up discussions on how we can come to some kind of final resolution of these complex but fundamentally important issues on party funding and spending. I think we can all agree that the discussion is not finished, but as I have said over and again in Committee, and as my right hon. Friend, the Secretary of State said on Second Reading, we believe that we can move towards such a final resolution only on the basis of consensus. Such important issues cannot be dealt with in any other way and certainly should not be turned into a party political football. That is why I share the regret of the hon. Member for Chichester that the Conservative party walked away from the discussions.
Mr. Tyrie: Will the Minister give way?
Mr. Wills: I am just concluding my remarks.
Mr. Tyrie: Will the Minister give way?
The Chairman: Order. The Minister is not giving way.
Mr. Wills: I hope that one day we will see consensus emerge on what we all agree are important issues. I think that all members of the Committee will wish to return to the subject in due course, but I do not believe that the amendment and the proposed new clause provide the place to do that. Having heard the debate from both sides, I hope that the hon. Member for Cambridge will withdraw the amendment.
David Howarth: The Minister came back to the point about consensus, but he seems to have a highly restricted view of where we should be going and how. There are times when politicians have to go with the consensus of the public, rather than the consensus of the parties. His final remarks illustrated that there is not even consensus among the parties on why the previous talks broke down, never mind on what to do about it. The public expect us to act, and to do so in a way that they see as fair, not partisan. The Government are in a position to make proposals that will be perceived as fair by the public as a whole. It is interesting that amendments have been tabled by Labour Back Benchers that would have had an adverse effect on the Labour party, but which they tabled anyway. That is the spirit in which the debate should continue.
Mr. Wills: Of course we must move forward in the way that the public want—that is what we all are here to do. I hope that the hon. Gentleman recognises, however, that if we cannot secure consensus among the parties it will become a partisan issue, axiomatically so. It will become very difficult to secure an enduring settlement. The public certainly do not want it to become a party political football or for it to be batted around between elections. We saw that at the beginning of the 20th century; it is not helpful to the processes of democracy. That is not an excuse for kicking the matter into the long grass and I hope that the hon. Gentleman will accept that. It is a duty of all hon. Members to try to achieve consensus, so that we can do precisely what the people of this country want us to do.
David Howarth: I am happy that the Minister has just said that it is a not a matter of kicking the issue into the long grass, but he is not right about the conditions under which we can get a permanent settlement. It is not necessary to have agreement among the parties to reach a position that will be stable. We need to reach a position that the public think is fair and when an attempt to move away from it would be seen as partisan and would lose support for the party that proposed it. That is what I am asking for on not only the issues raised under new clause 22, but donations, expenditure caps and relations between the unions and the Labour party. The possible solution that has been suggested would enable us to reach the point at which we could propose a settlement that the public, not the parties, would want.
Mr. Tyrie: I agree entirely with the hon. Gentleman. Does he agree that we cannot arrive at the point at which one party can have a veto over change if it were clearly what the overwhelming majority of voters concluded would enable greater public trust to be restored in such matters?
David Howarth: I agree with that. What matters is whether the public would perceive as fair a system with which one party did not agree. If the other parties ganged up on a particular party just to do it down, the public would not consider that to be fair. It would not be a stable position. I am not suggesting that. We should all think about what would be a fair settlement and go for it, regardless of whether one or two of us might object on partisan grounds to the eventual fair solution.
Having heard the debate on new clause 22, I readily confess that it could do with some more work. As the Minister said, a number of groups are excluded from parliamentary elections, some of which I certainly would want to exclude from the right to donate, including peers. I would be a bit more doubtful about others, such as European Union electors who are not peers in this country. An interesting question was asked about whether we should allow United Kingdom citizens abroad, some of whom are not peers strangely enough, to be donors.
I want to mention prisoners, the issue raised by the hon. Member for Huntingdon. At the moment, they are not allowed to vote. A European Court of Human Rights judgment is against the Government on that point. The problem can be resolved in several ways, but not by granting the right to vote to all prisoners. Taking away the right to vote should be considered to be a specific part of a sentence, because the right to citizenship and the rights of citizenship should be considered separately from other aspects of what happens to someone. That is the correct approach, because being a citizen with the right to vote should be considered an important matter.
Even though I recognise the problems in how new clause 22 has been drafted, I am encouraged by the remarks made by the hon. Member for Manchester, Central about the acceptance of the spirit behind it, especially behind proposed subsections (2) and (3) on anti-avoidance. It is the constant task of legislators to look out for ways in which what they intend is being got round in the world outside. That is why legislation cannot be for ever. When rules that are laid down are being avoided by devices that undermine their spirit and intention, we should do something about it. With that in mind, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 9 ordered to stand part of the Bill.

Clause 10

Election expenses incurred for person not yet a Candidate
3.15 pm
Martin Linton: I beg to move amendment No. 201, in clause 10, page 8, line 29, leave out subsection (2)(b) and insert—
‘(b) for “after the date when he becomes a candidate at the election” there is substituted “after the 50th month following the month of the previous general election”’.
The Chairman: With this it will be convenient to discuss amendment No. 202, in clause 10, page 9, line 2, at end add—
Martin Linton: We come now to triggering, which for many of us is the most important issue in the Bill. I am conscious that we have very little time left so I shall not take an unfair share of it. It is important to set out the issues. I have been dedicated for a long time to the notion that if the Bill achieves nothing else, it should close the loophole unintentionally created in the 2000 Act—on which Committee I also served—which leaves completely unrestricted spending by candidates up until the date of dissolution.
Triggering—in other words, control of candidates’ spending—was in force for 17 years before that, since the 1983 Act and, as far as I know, since the Corrupt and Illegal Practices Prevention Act 1883. For most of our history we have had control of candidates’ spending. It was dropped only by mistake in the 2000 Act. I have looked up the historic debate in the House of Lords where that occurred. Amendment No. 253G was the first time in the discussion of that Bill that it was proposed to introduce the words
“a) on the date of—
(i) the dissolution of Parliament,”—[Official Report, House of Lords, 24 October 2000; Vol. 618, c. 227.]
That was just a few weeks before the Bill received Royal Assent, long after it had left the House of Commons and long after the Committee stage. The phrase had never been mentioned and there had been no intention or discussion to remove the trigger during the course of that Bill. Then on 24 October that amendment appeared in the House of Lords. It was opposed by the Conservative Front Bencher Lord Mackay of Ardbrecknish, who sought to delete the words
“on the date of dissolution”.
Sadly, the deletion was opposed by the Government Front Bencher at that time, Lord Bach, who said:
“If he withdraws his amendments, I promise to look at the point that he has raised.”—[Official Report, House of Lords, 24 October 2000; Vol. 618, c. 229.]
That is a phrase we often hear in Committee and on Report. I have implicit trust in the Minister that when he has said to me that he promises to look at the points that I raised on a number of amendments, he will be as good as his word.
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