Part 3: Stop notices

99.     Paragraph 10 provides that the Electoral Commission can impose a stop notice on a person in order to prevent them from continuing or repeating a particular activity which the Commission reasonably believes is (or is likely to be) a prescribed offence or a contravention of a prescribed requirement or restriction under the 2000 Act. A stop notice can also be imposed where the Commission believes that a person’s behaviour is likely to lead to them committing an offence or acting in contravention of a prescribed requirement or restriction contained in the 2000 Act. In both cases the Commission must believe that the activity, or potential activity, is seriously damaging to public confidence in the effectiveness of the controls in the 2000 Act on income or expenditure by registered parties and others, or that it significantly risks doing so.

100.     Paragraphs 11 to 14 set out the details and limitations of how the stop notice system operates. Paragraph 11 lists the information to be included in a stop notice. This is the grounds for imposition, rights of appeal and consequences of non-compliance. Paragraph 12 requires the Commission to issue a “completion certificate” once they are satisfied that the person has taken the steps set out in the stop notice (at which point it will cease to have effect). The person upon whom a notice has been imposed may apply for a completion certificate at any time and the Commission must make a decision on the application within 14 days of receipt. Paragraph 13 explains how a person may appeal against the imposition of a stop notice, or against a decision not to issue a completion certificate, and provides that any appeal will be heard by a county court (or sheriff in Scotland). It also sets out the grounds for appeal in both circumstances. Paragraph 14 provides that a person who does not comply with a stop notice is guilty of an offence.

Part 4: Enforcement undertakings

101.     Paragraph 15 outlines the powers of the Commission to accept an enforcement undertaking from a person whom the Commission have reasonable grounds for believing has committed a prescribed offence or contravened a prescribed restriction or requirement of the 2000 Act. An enforcement undertaking may be offered by the person suspected of the offence or contravention and outlines the action they will take (within a specified period). The action may be with a view to preventing the recurrence of the offence or contravention or returning the position to what it would have been had the offence or contravention not taken place or it may be action of a kind that has been prescribed in an order by the Secretary of State. Sub-paragraph (1)(d) requires that the undertaking will take effect only if the Commission accept it. Sub-paragraph (2) makes clear that a person who has complied with the accepted undertaking will generally be exempt from other sanctions, including criminal proceedings, in relation to the acts or omissions on which the undertaking is based as long as the undertaking is complied with.

Part 5: Power to make supplementary provision etc by order

102.     Paragraph 16 gives the Secretary of State the power to make orders that are supplemental to, consequential on or incidental to this Schedule. Such provisions may include transitional provision. This includes the power to amend, repeal or revoke any enactment.

103.     Paragraph 17 sets out the consultation process that the Secretary of State must carry out prior to making a supplementary order under paragraph 16. As part of this process the Electoral Commission must be consulted, along with other persons that the Secretary of State considers appropriate. Under sub-paragraph (2) further consultation is required where, following the outcome of the initial consultation, it is apparent that substantial changes to an order will be necessary. Any consultations which are conducted prior to the commencement of this Schedule may count for these purposes.

104.     Paragraph 18 sets out the details of what can be included in a supplementary order regarding the Commission’s power to impose financial sanctions, including fixed monetary penalties, variable monetary penalties and non-compliance penalties. In particular, provision made by virtue of this paragraph may include detail about early payment discounts, late payment penalties, late payment interest and enforcement.

105.     Paragraph 19 sets out the details of what can be included in a supplementary order in relation to enforcement undertakings. The order may include a wide range of detail about procedural matters relating to undertakings, for example, how undertakings are entered into and in what circumstances undertakings are regarded as having been complied with.

106.     Paragraph 20 states that a supplementary order may extend the time available to institute criminal proceedings against a person in certain instances. The first of these is where a non-monetary discretionary requirement (but no variable monetary penalty) has been imposed and the person has failed to comply with the non-monetary discretionary requirement. The second is where there has been a breach of all or part of an enforcement undertaking.

107.     Paragraph 21 allows a supplementary order to set out the details of the appeals process in relation to the imposition of a requirement or the service of a notice under this Schedule. Such an order may include provision conferring relevant powers on courts (for example, to withdraw the requirement or notice against which there is an appeal).

Part 6: General and supplemental

108.     Paragraph 22 limits the use of fixed monetary penalties, discretionary requirements and stop notices. It explains that a fixed monetary penalty may not be imposed on a person if they are already subject to a discretionary requirement or stop notice for a breach. Additionally, if a person has had a fixed monetary penalty imposed on them for a breach or has paid a sum to discharge liability for a fixed monetary penalty, they cannot be given a discretionary requirement or a stop notice in relation to the breach.

109.     Paragraph 23 provides that, if someone is required under Schedule 19A to the 2000 Act to make a statement as part of an investigation by the Commission, the Commission must not take account of that statement when deciding whether to impose a civil sanction on the person. The only exception is for the offence of providing false information set out in paragraph 12(3) of Schedule 19A to the 2000 Act.

110.     Paragraph 24 stipulates that any financial penalty imposed on an unincorporated association must be paid from its own funds.

111.     Paragraph 25 requires the Commission to publish guidance about enforcement of the 2000 Act. The guidance must include details of the sanctions available (both civil and criminal), the circumstances in which civil sanctions may be used and the rights of appeal available. Sub-paragraph (7) requires the Commission to carry out consultations with persons that they consider appropriate prior to publishing guidance. Under sub-paragraph (8) the Commission is required to have regard to the guidance when exercising its functions.

112.     Paragraph 26 stipulates that all monetary penalties paid to the Commission as a result of the imposition of the civil sanctions under the Schedule must be paid into the Consolidated Fund.

113.     Paragraph 27 requires the Commission to publish reports listing the cases in which they have imposed fixed monetary penalties, discretionary notices or stop notices (except where these sanctions have been successfully appealed against); cases in which liability for a fixed monetary penalty has been avoided through payment of a sum; and cases in which an enforcement undertaking has been accepted. Sub-paragraph (2) enables the Commission to exclude information if it might be unlawful for the report to include it (for example, because its inclusion might breach the right to respect for private and family life protected by Article 8 of the European Convention on Human Rights, or there is a statutory restriction on its disclosure).

114.     Paragraph 28 lists the public bodies from which the Commission may request information when exercising the powers under the Schedule. It also precludes disclosures that would contravene certain other relevant legislation on data protection, and provides that powers of disclosure that are independent of this power are not affected by it.

Part 7: Interpretation

115.     Paragraph 28 sets out definitions of words and expressions used in the Schedule.

Schedule 3: Declaration as to source of donation

116.     Schedule 3 makes amendments in relation to donations to individuals and members associations, recognised third parties and permitted participants, which correspond to the amendments made in relation to donations to registered political parties by clause 8. Paragraph 1 inserts new paragraph 6A into Schedule 7 to the 2000 Act (control of donations to individuals and members associations), and paragraphs 2 and 3 make consequential changes to that Schedule. Paragraph 4 inserts new paragraph 6A into Schedule 11 to the 2000 Act (control of donations to recognised third parties) and paragraphs 5 and 6 make consequential changes to that Schedule. Paragraph 7 inserts new paragraph 6A into Schedule 15 to the 2000 Act (control of donations to permitted participants) and paragraphs 8 and 9 make consequential changes to that Schedule.

117.     Paragraph 10 amends Schedule 20 to the 2000 Act to specify the penalties which will be incurred for making a false declaration as to the source of a donation to individuals and members associations, recognised third parties and permitted participants.

Schedule 4: Minor and consequential amendments and Schedule 5: Repeals

118.     Clause 19 gives effect to Schedules 4 and 5. Schedule 4 makes minor and consequential amendments. (All of these are amendments that are consequential on other provisions in the Bill, except those at paragraphs 12 and 18, which make minor drafting changes.) Schedule 5 makes a number of repeals.

FINANCIAL EFFECTS

119.     The provisions that relate to European Parliament elections have no associated costs and are intended to make the administration of those elections simpler and easier to plan. The provisions that relate to the annual canvass are intended to assist with the registration of electors before an autumn poll. While they do create a new type of administrative burden in the event of an autumn poll being held, the Department does not envisage that this will give rise to increased costs if administrators follow Electoral Commission guidance in this respect; and a much larger burden may arise if no action is taken

120.     The additional costs incurred as a result of the provisions relating to the disposal of election documents are not expected to be significant and will be met by central government through the Fees and Charges Order for Returning Officers.

121.     Electoral administrators may incur costs as a result of the provisions relating to the CORE scheme, but these should be partially if not wholly off-set by savings achieved through the reduction of burdens produced through other provisions of the CORE Scheme.

122.     The Electoral Commission is directly financed by Parliament (paragraph 14 of Schedule 1 to the 2000 Act). The Commission submits annual estimates to the Speaker’s Committee and the Committee examines the estimates, considers advice from HM Treasury and the Comptroller and Auditor General, and lays the estimates before Parliament (explaining any modifications which it has made if relevant). Additional costs from this Bill will be financed in the same way. The Commission has already re-staffed its party and election finance team with a view to the forthcoming legislative changes. The Commission’s provisional estimate is that the additional costs arising to it as a result of the changes to its powers and governance in the Bill will amount to approximately £650,000 per annum. The Commission will consider the extent to which this can be met from within its existing settlement.

123.     There would be no cost to the National Loans Fund.

PUBLIC SECTOR MANPOWER

124.     As indicated above, a small increase in the manpower of the Electoral Commission may be required in order for it to fulfil its expanded role. The Department does not envisage that there would be any other impact on public manpower as a result of the provisions of the Bill.

SUMMARY OF IMPACT ASSESSMENTS

125.     The completed impact assessments for the Bill analyse the costs and potential benefits of the proposals and assess their probable impact on race, gender and disability equality. These are available in the Vote Office.

126.     The impact of the Bill will depend upon how the Electoral Commission decides to implement internal changes as a result of its changed role. The level of extra costs which the Commission might incur is estimated above, though this figure does not account for reprioritisation within the Commission and there is likely to be some scope for meeting some of the costs from within the Commission’s existing settlement.

127.     Under the provision that relates to candidate spending, candidates will be required to report all spending incurred for electoral purposes, not just that which is used between dissolution of Parliament and the election. The level of spending to be reported will be the same, as the spending limit will not change, but the time period during which campaign activities are reportable is likely to be longer. Whilst this may increase the administrative burden for some candidates and their agents, the burden will be no greater than it was under the pre-2000 triggering regime and this change to reporting requirements is considered to be a necessary consequence of effective regulation.

128.     The provisions that relate to European Parliament elections have no associated costs and are intended to make the administration of those elections simpler and easier to plan. The provisions that relate to the annual canvass are intended to improve the registration of electors before any autumn poll. While they do create a new type of administrative burden in the event of an autumn poll being held, a much larger burden may arise if no action is taken.

129.     No impact assessment has been carried out on the provisions relating to the disposal of election documents in Scotland. The additional costs incurred by Parliamentary Returning Officers in Scotland and their support staff as a result of the new policy will not exceed £5m and will be met by central government through the Fees and Charges Order for Returning Officers.

130.     No impact assessment has been carried out on the provisions relating CORE scheme. There will be an impact on electoral administrators but this is expected to be less than £5m in total and should be partially if not wholly off-set by savings achieved through the reduction of burdens produced through other provisions of the CORE Scheme. These will be explored in detail through consultation on the CORE Scheme Order.

131.     Under the arrangements for greater transparency of donations, donors will be required to make a declaration as to whether or not, to the best of their knowledge, a third party has given the donor to the political party, regulated donee, recognised third party or permitted participant more than £5,000 - or £1,000 with respect to donations to accounting units of registered parties - with a view to, or otherwise in connection with, the making of the donation. The main impact of this policy will be the extra administrative burden placed on donors in completing the declaration, and on recipients, who will have to process the declarations. The simplicity of completing and processing declarations should ensure that the administrative burden is not significant. It is considered that, the relatively small additional burden on parties and other individuals and entities on whom it is imposed, to ensure that donations over the threshold are accompanied by an appropriate declaration and accordingly advising the Electoral commission in donation reports, is justified by the additional transparency this clause entails by requiring donors, at time of making the donation to consciously consider whether they are acting as an agent for someone else.

COMPATIBILITY WITH THE EUROPEAN CONVENTION OF HUMAN RIGHTS

132.     Section 19 of the Human Rights Act 1998 (“HRA”) requires the Minister in charge of a Bill in either House of Parliament to make a statement before second reading about the compatibility of the provisions of the Bill with the Convention rights (as defined by section 1 of that Act).

133.     Secretary Jack Straw, the Secretary of State for Justice, made the following statement of compatibility in accordance with section 19:

“In my view the provisions of the Political Parties and Elections Bill are compatible with the Convention rights.

134.     In making the statement the Secretary of State has given consideration to the fact that the following provisions of the Bill may raise issues in relation to convention rights. For the purposes of what follows the Electoral Commission is considered to be a public authority as defined in section 6(3) of the HRA.

Clause 13

135.     Clause 13, which makes provision in relation to voter registration, may be said to engage Article 3 of Protocol 1 (the right to free elections by secret ballot). It is arguable whether this Article is even engaged. However, if it is engaged the provision made by this Bill is compatible as it seeks to ensure effective voter registration, rather than to restrict it.

Schedules 1 and 2

136.     While compatible with Convention rights, Schedules 1 and 2 to the Bill provide powers which, when used, may give rise to issues relating to Convention rights. In each case it will be the duty of the Commission (and any other public authority able to exercise a power) to ensure that a power is exercised compatibly with Convention rights in accordance with section 6 of the HRA. The relevant powers have built into them some important safeguards to ensure that each power is capable of being exercised fully compatibly with Convention rights.

Schedule 1 (inserting Schedule 19A in the 2000 Act)

137.     Paragraphs 1 to 3 of the Schedule contain various powers to require the disclosure of documents and to make copies of, or inspect, those documents or related information. These powers raise a number of issues around Convention rights.

138.     Where disclosure is sought under paragraphs 1 to 3 it is a criminal offence under paragraph 12 to refuse to comply with any requirement imposed by the Commission. Use of evidence provided under such a “compulsory” power in proceedings that may incriminate the person providing it could infringe the privilege against self-incrimination, a key component of the procedural fairness guarantees provided by Article 6 (right to a fair trial). Paragraph 11 is designed to ensure that the privilege is protected by prohibiting the use of a self-incriminating statement against the person who provided it in criminal or civil proceedings, except where the proceedings relate to the making of false statements. This is supplemented by paragraph 24 of Schedule 19B, which ensures that this type of evidence may not be relied on by the Commission when deciding whether to impose a fixed monetary penalty or a discretionary requirement. An additional safeguard is the power in paragraph 10, which prevents disclosure of information that is subject to legal professional privilege.

139.     Obtaining information under the various methods in paragraphs 1 to 3 may result in the production or inspection of personal information, with the result that Article 8 (right to respect for private and family life) may be engaged. In each case the powers feature appropriate safeguards relating to the nature of the documentation that may be required and the purpose for which it can be examined. In the case of paragraph 3, there is the additional safeguard of needing to obtain a warrant from a justice of the peace before the power can be exercised. In each case, these requirements should help to ensure that any use of the power to obtain disclosure is justified and proportionate in the pursuit of a legitimate aim of helping the Commission perform its monitoring functions. However, an individual judgement will need to be made in each case, and the Commission will have to consider justification and proportionality carefully each time it proposes to exercise the power.

140.     The powers of entry under paragraph 1 and 3, possibly using reasonable force under the latter, may raise a specific issue under Article 1 of Protocol 1 (protection of property). Both paragraphs feature safeguards designed to ensure that the powers will be exercised compatibly with Convention rights. The fact that under paragraph 3(1), a warrant may not be issued unless the Commission can demonstrate to a justice of the peace that they hold the same reasonable suspicion as to wrongdoing as under paragraph 2 ensure that the legitimate aim of investigating a breach of the law is pursued by the granting of any warrant and subsequent entry authorised by it. Further, a warrant may only authorise the use of such force as is reasonable to enter the premises and to take documents named in the warrant that are relevant to the investigation. For these reasons the power should be capable of being used in a way that is fully compatible with Convention rights. Again, this will be matter for careful consideration by the Commission in each case.

Schedule 2 (inserting Schedule 19B in the 2000 Act)

141.     The provision of civil sanctioning powers in Schedule 19B to the 2000 Act, as inserted by Schedule 2 to the Bill, raises a number of issues around Convention rights. The most significant issues relate to Article 6 (right to a fair trial) and the Bill contains appropriate safeguards to ensure compatibility with that and other Convention Rights.

142.     The first safeguard as regards Article 6 relates to the standard of proof. Before a fixed monetary penalty or a discretionary requirement (monetary or otherwise) may be imposed the Commission must be satisfied to the criminal standard of proof (i.e. beyond reasonable doubt) that a prescribed offence has been committed or a prescribed restriction or requirement has been breached. In contrast a stop notice is essentially preventative in nature. Because of this, a different standard of proof (reasonable belief) applies.

143.     Whether the criminal or civil limb of Article 6 is engaged, the Article requires access to an independent and impartial tribunal in certain circumstances. In recognition of this, a final decision of the Commission to impose a fixed monetary penalty, discretionary requirement (whether monetary or otherwise) or stop notice is subject to an appeal to a county court. Other related enforcement decisions (including a decision to impose a non-compliance penalty for failure to comply with a discretionary requirement and a refusal to issue a completion certificate in respect of a stop notice) allow the same right of appeal. These appeal rights are sufficient to ensure that the provisions are compatible with Article 6 by providing a direct right of appeal to the county court, which stands free of any additional right to seek judicial review.

144.     There is no right of appeal as regards enforcement undertakings. Given the voluntary nature of these arrangements, the absence of any dispute between the parties and the fact that failure to comply does not have direct consequences in terms of civil or criminal liability, neither limb of Article 6 is engaged.

145.     A third safeguard, contained in paragraphs 4(1) and 8(1) of the inserted Schedule, is that no criminal conviction may be pursued where a decision has been taken to impose a civil penalty that is potentially capable of classification under the criminal limb of Article 6. There are exceptions to this where the sanctions in question do not feature a punitive element. For discretionary requirements an exception to this rule applies where a person fails to comply with a non-monetary discretionary requirement and a variable monetary requirement has not also been imposed. A similar exception is made in respect of enforcement undertakings that are not complied with. Because these sanctions are not punitive in nature the possibility of further criminal or civil proceedings should be preserved in case the entirely preventative requirement is not complied with.

146.     In order for this measure to be fully effective, time limits for criminal prosecution in the event of such failure may be extended by order (see paragraph 21 of the inserted Schedule). In making any order of this type the Secretary of State would be bound by section 6 of the HRA to ensure that these time limits are not given retrospective effect so as to contravene Article 7 of the ECHR (no punishment without law).

147.     A requirement in a stop notice to cease carrying on an activity could impose a constraint on the ability of an individual or organisation involved in the political process to act in certain ways. A requirement of this sort could be said to engage Article 10 of the ECHR (freedom of expression). Article 10 is unlikely to be engaged as it does not provide a right to participate in the political process in breach of domestic law regulating such participation. Even if Article 10 is engaged, there should be no interference as a stop notice seeks to prevent unlawful acts rather than lawful participation in the political process. In any event, the high threshold to be satisfied before a stop notice can be issued should ensure that any decision to do so is justified and proportionate in pursuit of a legitimate aim.

148.     In addition, Article 1 of Protocol 1 (protection of property) might be said to be engaged, depending on the factual circumstances. However, if engaged, then, for the same reasons given in respect of Article 10, any interference would be justified and proportionate in the pursuit of a legitimate aim.

149.     Paragraph 27 imposes an obligation on the Commission to publish reports summarising the cases in which civil sanctions have been imposed. There is a wide discretion about what a report may contain and the power should be capable of being exercised fully compatibly with Article 8 (right to respect for private and family life) should it be engaged. As an extra safeguard, paragraph 27(2) enables the Commission to omit anything that it thinks would be unlawful to publish (e.g. because publication would be incompatible with Article 8).

150.     Paragraph 28(1) enables specified bodies to provide information which they hold, or which is held on their behalf, to the Commission for the purposes of enabling the Commission to exercise any powers provided by Schedule 19B. It will be for the named bodies to ensure that the power is exercised compatibly with Convention rights, notably Article 8. In all cases, the exercise of the power should be in pursuit of a legitimate aim (that of enabling the Commission to perform its regulatory role properly and effectively). Whether the purported exercise is proportionate to that aim will be a matter for the disclosing body to consider in each case.