Nadine Dorries - Standards Committee Contents


Report


Introduction

1.  This Report arises from a memorandum from the Parliamentary Commissioner for Standards dealing with the conduct of Nadine Dorries in respect of the registration of fees relating to her appearance in "I'm a Celebrity ... Get Me Out of Here!", an ITV television programme. In essence, the Commissioner has found that those payments ought to have been registered. Ms Dorries contended that such payments (if any) were made to a company, Averbrook Ltd, of which she is a director, and that she was not required to register income received by the company, but only any remuneration she drew from it. Ms Dorries further contends that as she was not required to register the company's income, she did not have to respond to the Commissioner's requests for information about payments for her media work.

2.  There are a number of questions we have had to consider in coming to our conclusions:

  • Do the rules require registration of payments that Ms Dorries receives from her media engagements which are made to a third party?
  • Has Ms Dorries breached the Code by refusing to co-operate with the Commissioner's inquiry, given that there was a difference of opinion about registration requirements for such payments?
  • What was the nature of Averbrook Ltd's business and when should the shareholding have been registered?

Since the Commissioner's memorandum sets out the detail of the case, we concentrate on key points.

Registration of payments to a third party

3.  In spite of her reluctance to provide the precise information the Commissioner requested, Ms Dorries has provided evidence that since October 2012 her income from media appearances had been paid to her. Her agents confirmed that:

payments for all written and media work undertaken by Nadine Dorries on behalf of Averbook Ltd since October 2012 have been paid to [us] and following deduction of our commission the remaining balances are paid to Averbook Ltd. No payments are made personally to Nadine Dorries.[1]

In oral evidence, Ms Dorries made clear that although she had a business partner, who had a minority shareholding and acted as copy-editor for her books, Averbrook Ltd. had no income from any sources other than her media appearances:

Andy does not invoice. My agents do not invoice for work that Andy has produced. They invoice for work that I produce, but Andy is a part of the production team that is invoiced for in my name. [2]

4.  The rules require that Members register their financial interests. There are currently 12 categories of registrable interest. We would have expected payments for media work to appear under category 2 in the Register "remunerated employment, office profession etc". The Guide to the Rules relating to the Conduct of Members specifies under Category 3 Clients that:

All employment outside the House and any sources of remuneration which do not fall clearly within any other Category should be registered here. Members must register under this category the precise amount of each individual payment made, the nature of the work carried out in return for that payment, the number of hours worked during the period to which that payment relates and (except where disclosure of the information would be contrary to any legal or established professional duty of privacy or confidentiality) the name and address of the person, organisation or company making that payment.[3]

5.  The Registrar of Members' Financial Interests advised Ms Dorries that any fees from I'm a Celebrity should be registered, whether or not those fees were paid directly to her or to a company. Ms Dorries contended that such registration was not necessary because a) all remuneration was paid to Averbrook Ltd, which had not yet made any payment to her; and b) because "my media work has no such bearing upon my representation of Mid-Bedfordshire".

6.  Ms Dorries also initially told the Commissioner:

I can provide you with a very long list of MPs in all parties who do not declare payments made to their companies or even their shareholdings, given that they maintain such shareholdings below 15%.

[...] I will cite [another Member]; who runs a [...] business. Are you seriously suggesting that every payment made to his busy family business by clients should be declared in the Register of Members' Interests?

I also take issue that, in light of there being no specific rule requiring MPs to register payments made to their Limited Company, you will make one up by telling Members they should and therefore attempting to establish a precedent.[4]

7.  In a letter to the Parliamentary Commissioner for Standards, following her appearance before this Committee, Ms Dorries shifted her position and said:

In the last week I have spoken to a number of MPs. Those in the 2010 intake of informed me that when they ring the registrar they are told they do have to register payments made to their company.

MPs have been in the House longer, such as I, were advised to register only payments drawn from the company.

However, an exceptional few, because payments to their company are regular occurrence based on a fixed term payments for non-execs, disclose what is paid to their company but these MPs are also of the opinion that they do this as a voluntary measure and in doing so are 'over declaring.'

This suggests that the interpretation of the rules has been subtly altered without MPs being formally told.[5]

8.  Both communications suggest that rules have been "made up" or that interpretations have been changed. The Registrar's advice will reflect the particular circumstances of the Member in question, and the relationship between the company and work done directly by the Member concerned him or herself. It is wrong to assume that the rules have been "subtly altered" on the basis of anecdotal information about the advice given to others.

9.  As Ms Dorries said, the rules do not require Members with shareholdings of below 15 per cent of a company to register them, providing that they are not greater in value than the current parliamentary salary. Nor do they require those with registrable shareholdings to register every payment made to those companies in which they have an interest. In many cases such payments will have nothing to do with any activity of the Member who holds the shares, or the payment will be unrelated to a Member's parliamentary role and fall below the registrable threshold. The requirement to register arises when payments are made to a company in respect of work done by the Member concerned.

10.  In the course of this inquiry we have looked most carefully at the rules and the advice given in connection with the registration of payments made to companies in respect of services provided by Members. The background to the current registration requirements is set out in the Commissioner's memorandum.[6] The House had agreed changes to the Guide to the Rules relating to the Conduct of Members on 9 February 2009. On 30 April 2009 the House agreed to a further, freestanding Resolution which required registration of the precise amounts paid to Members for all types of employment, regardless of their value.[7] The Committee on Standards and Privileges then updated the Guide to reflect that Resolution. When the updated Code of Conduct and Guide to the Rules relating to the Conduct of Members was issued to all Members in June 2009 it was accompanied by more detailed guidance, issued under a letter from the then Chair of the Committee on Standards and Privileges, Sir George Young. In his covering letter, Sir George noted that:

I enclose a copy of the revised Guide to the Rules, together with a note prepared by the Registrar which translates the decisions of 9 February and 30 April into more detailed guidance. The guidance necessarily reflects decisions of the House, which bind the Registrar as they bind us all. Members who have concerns about the effect of the changes may wish to communicate them to the Leader of the House, as I have done. [8]

11.  That guidance contained the following:

a number of Members run their own companies. When considering how to make entries in respect of these, Members should distinguish between earnings which are result [sic] from their efforts alone and those which result also from those of others. Members in such a position should:

a) register a company in the appropriate category, which would usually be Category 1;

b) register under Category 3 (Clients) within four weeks of receipt all payments to the company from clients of the company to whom they provide personal services together with the nature of the work and the number of hours worked.[9]

It remains extant on the Commissioner's webpages, on the page where forms for registration can be found.

12.  The June 2009 advice on registration of payments to companies was based on established practice. The Committees charged with considering standards cases have consistently required Members to register work done through companies.[10] In its Seventh Report of Session 1999-2000, published in March 2000, the Committee on Standards and Privileges gave guidance on the registration of fees for media appearances and related work, which included the statement that "in the case of any fees which are paid to a company, rather than directly to the Member, the person or organisation paying the fees should be registered under Category 3 (Clients) as a client of the company if not registered under Category 2".[11] There is an almost exact precedent for the payment to a third party in respect of work done by a Member of Parliament dating from 2001:

Members are required to register any employment "in which the Member has any pecuniary interest".[....] Because the company was owned by Mr Robinson and his own services were an integral part of the agreement for services for which the remuneration was sought, the fact that the payment was to be made to his company, TransTec, for services provided by that company does not alter our view of this case. Whether the payment was intended to be made to Mr Robinson or TransTec is immaterial.[12]

That Report was approved by the House on 31 October 2001.

13.  It is clear that the motion in 2009 was intended to tighten existing rules rather than to relax them. The intention was to ensure that registration of Members' remunerated work outside the House was complete and transparent: it would frustrate this aim if a Member were able to avoid registration by the device of ensuring payments for his or her work were made to a company.[13] While company accounts give some indication of payments received by a company, they do not give the detail which the Guide to the Rules requires. The Code and Guide are not intended to be interpreted in a narrow legalistic way. Members need to measure their conduct against the Seven Principles of Public Life, which are part of the Code and include accountability, openness, honesty and leadership. The use of payments to a company to avoid declaration of earnings would be incompatible with these principles.

14.  We acknowledge that the Guide to the Rules could be better expressed. In its proposed revision to the Guide, the Committee on Standards and Privileges agreed to changes in registration categories and agreed that:

if payments in respect of work done by a Member are made to some other person or organisation, and if those payments are not passed on to the Member in a form which can be easily linked to the work done, or at all, that Member should nevertheless register any such payment to the other person or organisation in respect of the Member's work.[14]

The then Commissioner's memorandum on the revision clearly indicated that this was a clarification, not a change to the rules. We regret that Ms Dorries's conduct has proved this clarification was wise.

15.  We also note that while Ms Dorries' media work may not have influenced her representation of mid-Bedfordshire, it is likely to have been linked to her work in the House. The entry from Ms Dorries's agent's website makes clear that her written media work was related to parliamentary affairs. We find it hard to believe she would have been invited to appear on "I'm a Celebrity" if she had not come to public prominence as a Member of the House.

16.  It is clear that Ms Dorries's media work was remunerated, whether or not those payments were made to her or to her company. We agree with the Commissioner that Ms Dorries should have registered payments for such media services even though those payments were made through Averbrook Ltd. We consider the question of confidentiality agreements later in this Report.

Advice from the Registrar

17.  In oral evidence, Ms Dorries said:

I telephoned the Registrar and had a conversation with her about it. I asked her "What do I need to do?", taking into account what other Members do who have businesses, of which there are many on both sides of the House. I asked, "What is the proper procedure for doing this?" She said to me, "I advise that you register every payment that goes into your company." I knew from other Members that that is not what Members do, so I said, "Do I have to do this?" She said, "No, you don't have to. I advise that you do."

I thought that that was ambiguous advice, so I sought a further layer of legal advice on top of that—an interpretation. The advice that I got was, "Yes, you have to disclose any remuneration that you receive—any payment that you personally receive—but you do not have to disclose any payment that goes into the company." I spoke to other colleagues—lots of them—who have businesses, and they all said exactly the same thing. They have also taken advice, and that has always been the interpretation of the rules; you disclose and you register what you take personally as payment, not what the company receives.[15]

As the evidence appended to the Commissioner's evidence shows, on 21 January 2013 the Registrar advised Ms Dorries in writing:

I also confirm that this office has always advised that a Member who has earnings from employment should register these if they are paid not to him or her but to another entity, such as a company of which he or she is an unpaid director. While the current Guide to the Rules does not cover this specific scenario, we have advised in individual cases that such earnings should be registered, and you will find in the current Register a number of such payments listed under the employment categories.[16]

18.  Ms Dorries and the Registrar interpreted the rules differently. Ms Dorries told us she consulted her colleagues; the advice she reports that they gave may well have been based on very different company arrangements than those in her case. She also sought legal advice for her interpretation of the rules: the requirements of the Code and Guide are those of the House, not of the courts, and there is no scope for the courts in interpreting them.

19.  It is for each Member to decide whether a particular interest falls within the rules requiring registration, bearing in mind the Code of Conduct, the Guide to the Rules and the purpose of the Register itself, which is "to provide information of any pecuniary interest or other material benefit which a Member receives which might reasonably be thought by others to influence his or her actions, speeches or votes in parliament, or actions taken in his or her capacity as a Member of Parliament".[17] Members should also have regard to The Seven Principles of Public Life, one of which is openness. The Committee on Standards and Privileges advised Members to approach the Registrar for guidance, and a previous Commissioner noted that following such advice gave Members "considerable assurance in the face of any subsequent complaint" and that if for any reason a breach was found, the advice would still have much weight when the Commissioner drew his conclusions.[18] The Registrar's advice will reflect best practice. Nonetheless, although it is prudent to take advice, Members may choose to disregard it, and if a complaint is made to explain later to the Commissioner and to the Committee why they considered that advice mistaken.

Did Ms Dorries co-operate with the Commissioner's inquiry?

20.  The Rules are clear that "the Commissioner may investigate a specific matter relating to a Member's adherence to the rules of conduct under the Code. Members shall co-operate, at all stages, with any such investigation by or under the authority of the House."[19]

21.  It would have been entirely proper for Ms Dorries to have provided the information requested, with the rider that she believed the information was not registrable and a request that the Committee should keep the sums involved confidential if they concurred with her interpretation of the rules. The Parliamentary Commissioner repeatedly told Ms Dorries "the evidence I receive is confidential unless and until it is published by me or the Committee on Standards"[20] and that "I would not expect to publish details of payments unless I had concluded that the rules of the House required you to have registered them."[21] What the rules do not contemplate is a blanket refusal to provide evidence.

22.  On this occasion the Commissioner did not ask the Committee to use its powers to compel the provision of evidence because, as her memorandum makes clear, there was sufficient material in responses from Ms Dorries combined with information already in the public domain to make progress with her inquiry.

23.  We recognise that the extent of the Commissioner's jurisdiction in this case had effectively been challenged by Ms Dorries herself and that, as Ms Dorries said, the Commissioner quite rightly could not give "an absolute degree of confidentiality", since it would depend on the Committee's judgment.[22] If Ms Dorries had simply asked for the matter to be referred to the Committee, we would not necessarily have considered the failure to provide information as a breach of the Code. We also recognise that, as Ms Dorries says, she responded promptly to the Commissioner's letters. But Ms Dorries responded to the Commissioner's requests for information with accusations that "your report amounts to a witch hunt" and "you are choosing to use a vexatious complaint made against me to reinforce your 'on the hoof make it up as you go policy" and threats of legal action.[23]

24.  Accountability is one of the principles of public life:

"Holders of public office [...] must submit themselves to whatever scrutiny is appropriate to their office"[24]

The Commissioner's memorandum sets out the position with the utmost clarity:

It is each Member's personal responsibility to register their interests. However, once I have initiated an inquiry into a Member's conduct, it is not for that Member to decide whether he or she has broken the rules. My role in investigating complaints is to report the facts I have established and to offer my conclusion on whether the Code has been breached. It is then for the Committee, and ultimately the House, to rule on whether or not the Member has breached the Code. [25]

25.  The rules require Members to subject themselves to the Commissioner's scrutiny. Accusations of the sort made by Ms Dorries are unacceptable. We agree with the Commissioner that Ms Dorries has committed a breach of the Code through her attitude to the Commissioner's inquiries.

Failure to register the Averbrook shareholding

26.  The Guide to the Rules requires remunerated directorships or shareholdings of above 15 per cent of the registered share capital of a company or of greater value than the current Parliamentary salary. Paragraph 20 states that:

Companies which have not begun to trade or which have ceased trading need not be registered, either under this Category or under Category 9 (Shareholdings). "Not trading" should, however, be interpreted in a strict sense; if a company is engaged in any transaction additional to those required by law to keep it in being, then a remunerated directorship in that company should be registered. If a Member wishes to register a directorship in a company which is "not trading" the Member should make the position clear by adding the words not trading after the name of the company.[26]

While Averbrook Ltd may have been an off-the-shelf company doing no more than required to keep it in being at the time Ms Dorries' office first contacted the Registrar, it is clear it was trading from October. This is shown by the evidence from Ms Dorries' accountants:

I confirm that all of your earnings since October 2012 have been reflected through Averbrook Ltd.[27]

We note that the Commissioner concludes that "I have no evidence that the apparent late registration of Ms Dorries' interest in Averbrook Ltd was other than inadvertent". It is unfortunate that the Registrar was not made aware that Averbrook Ltd was trading, and Ms Dorries' shareholding should therefore have been registered, in a timely manner. We agree with the Commissioner's finding that the failure to register the shareholding was a breach of the rules, but we do not consider it a serious breach.

Conclusion and recommendations

27.  Payments directly made for services should be registered whether or not they are made to a third party. That is the advice given by the Registrar, and, as we note, this advice is consistent with earlier decisions of the House following reports from the Committee on Standards and Privileges. There are many entries in the Register where Members have noted payments for their services which have been made to companies, rather than to them directly. Even so, we share the Commissioner's regret that the House has not yet had time to consider the proposed revisions to the Guide put forward by the Committee on Standards and Privileges in December 2012. This would have ensured the Guide to the Rules contained explicit provisions reflecting the advice of successive Registrars and the precedents from the Committee on Standards and Privileges.

CONFIDENTIALITY AGREEMENTS

28.  Ms Dorries told the Commissioner she could not provide the detailed information the Commissioner sought because:

All contracts with commissioning companies are confidential and commercially sensitive.[28]

In oral evidence she said there was a confidentiality agreement between ITV and Averbrook and that:

if I were ever to disclose and to say, "This is the amount of money that I am paid by ITV," I would fall foul of that contract and would be at the mercy of ITV [29]

As the Commissioner points out, the rules permit the withholding of the identity of the name and address of those from whom payments are received where there is a legal or professional duty of privacy or confidentiality; they do not permit withholding the fact that payment has been made.[30]

29.  We sought advice on the extent to which the law of confidentiality can bind Members in official proceedings of the House from Speaker's Counsel, and the Clerk of the Journals. While the rules relating to the conduct of Members recognise the public interest in upholding professional confidentiality, the House's rights to information cannot be overridden by confidentiality agreements. If they were, then Members could evade the registration requirements by making sure that such agreements were in place for all their employment. Erskine May deals with witnesses and evidence in connection with Committee powers[31] and makes clear that:

there is no restriction on the power of committees to require the production of papers by private bodies or individuals, [...] Solicitors have been ordered to produce papers relating to a client.[32]

The prohibition against impeaching or questioning proceedings in Parliament in Article 9 of the Bill of Rights, and the provisions of the Parliamentary Papers 1840 also make it unlikely that an action for damages or other claim for breach of contract, where such a breach arose from obedience to an Order of the House, would be heard by a court. As Speaker's Counsel said:

No such action could be sustained in the courts of the United Kingdom, and this by reason of the constitutional principle reflected in Article IX of the Bill of Rights.[33]

In any event, Ms Dorries should not have signed a contract which required her to keep confidential matters which should have been registered.

30.  It was only after the Committee shared the paper on confidentiality with her that Ms Dorries informed us that she would "seek to ensure that future contract wording is amended to include the exemption provisions" about confidentiality. She also asked to include the following information in her Register entry:

For the year from October 31st 2012 to October 31st 2013:

Approximate gross income is £142,000

Giving a profit of £82,000

A dividend payment of £10,000 is being paid to Nadine today (30.10.2013)

Nadine spent approximately 60 days working on Averbrook's projects, which are still best described as 'writing and media appearances'.

These figures are provisional before the full accounts are produced in December but Nadine would like the register to be updated as soon as possible.[34]

This information gives a broad view of Ms Dorries's major activities, and the time she spends upon them. It does not meet the requirement that under category 3 of the register "Clients":

Members must register [...] the precise amount of each individual payment made, the nature of the work carried out in return for that payment, the number of hours worked during the period to which that payment relates.[35]

31.  In her initial evidence, Ms Dorries suggested that other Members might be using limited companies as a way of avoiding the House's registration requirements, although her more recent comments modify this assertion. The Register shows that many Members already follow the Registrar's advice, and we have seen no evidence of widespread use of companies to evade registration requirements. Any Member with concerns about their current arrangements for registering company related income should consult the Registrar as soon as possible.

32.  Ms Dorries must register the details required by the rules. That leaves her initial failure to abide by the Registrar's advice, and her attitude toward the Commissioner's inquiry. The House's Code of Conduct and disciplinary system depend on Members being prepared to explain their conduct, to submit to public scrutiny and where necessary, to respond to the Commissioner's inquiries. We recommend that Ms Dorries

  • register all payments in respect of her employment, whether or not they have been channelled through Averbrook Ltd or any other third party and
  • apologise to the House by way of a Personal Statement.

We expect Ms Dorries to consult the Registrar in person about the detail of her Register entry within 21 days of publication of this Report. We will monitor Ms Dorries's compliance and will recommend further action if necessary.


1   WE 11 (Footnotes: "WE" footnotes refer to the numbered items in the virtual volume on the Committee's website) Back

2   Q 4 Back

3   House of Commons, The Guide to the Rules relating to the Conduct of Members, HC (2010-12) 1885, para 24 Back

4   WE 23 Back

5   Appendix 4. Back

6   Appendix 1, paras 46-48 Back

7   The rules were subsequently amended to increase the threshold for registration after experience had shown that the stipulation that all payments had to be registered had resulted in trivial payments and gifts being entered on the register. Back

8   The Committee on Standards and Privileges was concerned about the lack of a lower threshold for the registration of payments. Back

9   Guidance issued under a letter from Sir George Young, the then Chairman of the Committee on Standards and Privileges, to all Members of Parliament on the Guide to the Rules, dated 23 June 2009, para 29 Back

10   Committee on Members' Interests, First Report of Session 1989-90, Geoffrey Robinson, HC 135 Back

11   Committee on Standards and Privileges, Seventh Report of Session 1999-2000, Complaint against Mr Ken Livingstone, HC 342, para 11 Back

12   Committee on Standards and Privileges, Seventh Report of Session 2000-01, Complaint against Mr Geoffrey Robinson, HC 465, para 5 Back

13   Committee on Standards and Privileges, Third Report of Session 2012-13, Proposed Revisions to the Guide to the Rules relating to the conduct of Members, HC 636, Appendix 1, para 34 Back

14   Ibid., Appendix 1, para 36 Back

15   Q 13 Back

16   WE 16 Back

17   House of Commons, The Guide to the Rules relating to the Conduct of Members, HC (2010-12) 1885, para 11 Back

18   Committee on Standards and Privileges, Tenth Report of Session 2007-08, Conduct of Mr George Osborne, HC 560, paras 14-15 and Appendix 1, para 64 Back

19   House of Commons, The Code of Conduct, HC (2010-12) 1885, para 19 Back

20   WE 9 Back

21   Ibid. Back

22   Q 19 Back

23   WE 23 Back

24   House of Commons, The Code of Conduct, HC (2010-12) 1885, para 8 Back

25   Appendix 1, para 61 Back

26   House of Commons, The Guide to the Rules relating to the Conduct of Members, HC (2010-12) 1885, para 20 Back

27   WE 8 Back

28   WE 3 Back

29   Qq 10-12 Back

30   House of Commons, The Guide to the Rules relating to the Conduct of Members, HC (2010-12) 1885, para 24 Back

31   This is because such matters are most likely to arise in Committee in modern practice.  Back

32   Erskine May, The Law, Privileges, Proceedings and Usage of Parliament, 24th edition (Chippenham and Eastbourne, 2011) p 819 Back

33   Appendix 4 Back

34   Appendix 6 Back

35   House of Commons, The Guide to the Rules relating to the Conduct of Members, HC (2010-12) 1885, para 28 Back


 
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© Parliamentary copyright 2013
Prepared 11 November 2013