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Lord Bassam of Brighton moved Amendments Nos. 74A and 75:

    Page 15, line 24, at end insert--

("( ) In connection with the registration of a party in both the Great Britain register and the Northern Ireland register, subsection (1)(a) and the other provisions of this section apply (in accordance with section (The new registers)(5)) separately in relation to the party in Great Britain and the party in Northern Ireland, and in that connection--
(a) any reference in this section to a constituent or affiliated organisation in relation to the party shall be read as a reference to a constituent or affiliated organisation in relation to the party in Great Britain or the party in Northern Ireland, as appropriate; and
(b) any reference in this Part to the party's constitution shall be read as a reference to the party's constitution so far as relating to the party in Great Britain or the party in Northern Ireland, as appropriate;
and the party's scheme must show that the financial affairs of the party in Great Britain will be conducted separately from those of the party in Northern Ireland.").

On Question, amendments agreed to.

Clause 23, as amended, agreed to.

Clause 24 [Financial structure of registered party: accounting units]:

Lord Bassam of Brighton moved Amendment No. 76:

    Page 15, line 39, leave out ("and (7)") and insert (", (7) and (8)").

On Question, amendment agreed to.

Lord Mackay of Ardbrecknish moved Amendment No. 76A:

    Page 15, line 42, leave out ("the person registered as treasurer of the party") and insert ("any other officer of the accounting unit").

The noble Lord said: I am trying to be helpful to the Government by suggesting an amendment which seeks to correct a fairly bizarre piece of drafting in the Bill which is certainly bizarre in its effect.

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I notice that the noble Lord, Lord Bach, is to reply to the amendment. We may make some progress here. The noble Lord's briefing probably says that as presently drafted Clause 24(3) applies the provisions of Clause 22(5) and (7) to the political parties' accounting units with certain modifications. Put more simply, Clause 24(3) means that if the treasurer of a local Conservative association or a constituency Labour Party dies, resigns or is voted out, until a successor is appointed the responsibility for the local party's financial affairs falls on the national treasurer of the national party.

How can the national party treasurer possibly ensure personally--and he must do so personally, for he will be legally liable under the Bill--that the financial affairs of such a local party are administered to the required standard, when the treasurer will probably have his or her hands tied with all the other consequences of the Bill?. He or she will be busily involved in the bureaucracy here in London, whereas the local party may be far away and may not be in a very good seat for the political party, which may not have a very big organisation there.

I may be wrong, but as I read the clause it appears that the national treasurer will be open to criminal prosecution if such a local party breaches any of the Bill's complex rules while he is responsible for its financial affairs. The drafting of the clause, in so far as it relates to local parties, does not reflect Clause 22(5) which relates to national parties. If the national treasurer dies or resigns, the leader of the party becomes legally responsible for the finances. I wonder whether the noble Lord, Lord Bach, has told the Prime Minister about that as well. But if a local treasurer dies or resigns, it is not the chairman or the secretary of the local party who becomes responsible and takes over the legal responsibility, but the national treasurer of the party. Is it realistic to expect the national treasurer of a party to discharge all the functions relating to the United Kingdom and then to discharge these particular local functions as well?

My amendment would change the situation so that another officer of the local party, rather than the national treasurer, would take over responsibility if a local treasurer died or resigned. I believe that that is a simpler, better and fairer way to deal with this matter. I hope that the Government will be prepared to accept it. It seems more relevant to the reality of how political parties are run and not to the odd way that the Bill sometimes assumes that political parties are run. I beg to move.

Lord Bach: I am afraid that I cannot be as helpful as I have been earlier this evening to the noble Lord. Amendment No. 76A is concerned with the situation in which a person registered as the treasurer of an accounting unit ceases to hold office and a person has yet to be registered in his or her place. The Bill presently states that in such circumstances the person registered as the treasurer of the party as a whole shall

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be deemed to be responsible for that accounting unit's financial affairs until such time as another person is registered as the accounting unit's treasurer.

If the amendment were to be carried, that responsibility would instead fall to some other officer of the accounting unit itself. We understand the reasons for the amendment. The very purpose of providing for the registration of separate accounting units is to take account of the fact that constituency associations and other local party organisations are usually responsible for their own financial affairs. In these circumstances, it would not normally be appropriate to hold the national party treasurer responsible for the accounts of such local party units. However, under Clause 24, the national treasurer would step into the void only in exceptional circumstances, such as the death of the treasurer of an accounting unit.

The difficulty with the noble Lord's approach is that it envisages responsibility for compliance falling to,

    "any other officer of the accounting unit".

But there is no requirement on a registered party to notify the electoral commission of the names of any other officers of an accounting unit. How then would the commission know which particular officer is to be held responsible? Unless we were to complicate the registration scheme yet further by providing for the registration of other officers of each accounting unit, the only practical alternative is to deem the registered treasurer of the central party organisation to be the responsible officer.

In practice, the end sought by the amendment could be achieved if, in the event of the registered treasurer of an accounting unit ceasing to hold that position, the party promptly registered another officer of the accounting unit as its new treasurer. That would, of course, require the management committee of the accounting unit to act quickly to appoint a successor. But it would need to do that in any event under this amendment in order to ensure that one of its number took on responsibility for the accounts. This underlines the fact that political parties will need to be alert to the consequences of the registration arrangements.

If a party intends to register as a party with accounting units, it will be important to ensure that procedures are in place to respond quickly to the death, or resignation, of a registered officer of the party or of one of its accounting units. With a little planning and guidance from party headquarters, we see no reason why that cannot be done. Many of us have practical experience of how parties actually run. We do not believe that what we propose here is impractical.

11.30 p.m.

Lord Hodgson of Astley Abbotts: This is another example of the view from 20,000 feet, as opposed to the view on the ground. In his eloquent explantion, the Minister talked about "accounting units". We are talking about constituency associations. They are real,

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live things: they are not creatures of Whitehall or of the commission. They vary enormously in their strength and their capability--and that applies to all parties--depending on where they are located. The role of the Conservative association treasurer in Stoke-on-Trent Central, or of the Labour Party treasurer in Cotswold, is not an enviable one.

In such circumstances, and bearing in mind the additional weight that will be imposed on them by other provisions in the Bill, there is a real chance that many of these associations will become de facto defunct because people will not wish to take on the burden, especially in parts of the country where their party is not the predominant one. If that were to happen, it would have serious implications for our democracy. It is important that all parties--indeed, even dear old Mr Bill Boakes's party--should be encouraged to have as wide a participation as possible.

My noble friend's amendment would provide greater flexibility at local level, instead of this moving immediately from the local "accounting unit"--a ghastly phrase, but I shall use it--to the centre. I can envisage a situation where the treasurer (if we have a treasurer when we come to the final version of the Bill) of, say, the Conservative Party, the Labour Party or the Liberal Democrat Party will end up being de facto and de jure the treasurer of a whole range of individual associations at local level, especially in parts of the country that are not favourable to that particular party's cause. It will not be possible to find people to take on the work and the responsibilities that will be thrust upon them by virtue of the Bill. At least the amendment of my noble friend offers an opportunity to take a slightly wider view. I believe it to be worthy of greater support and explanation than the Minister has so far given it.

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