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Lord Norton of Louth: Before the noble Lord sits down, a large thrust of his argument is that there should not be a public subsidy of political parties. But surely there already is. I refer to what is provided for parties at election time in terms of mail distribution and election broadcasts. In effect, it is already there; so the principle surely is already conceded.

Lord Bassam of Brighton: I accept that there is state support, but it is very limited and it is for specific purposes. This takes us a stage further. It would, by another route, be indirect state funding. Most people would accept that whether it is tax relief or direct grant aid, it is state funding. This is a big leap to take in that direction.

Lord Cope of Berkeley: It has been an extremely interesting debate. As the Minister rightly acknowledged at the start of the debate, the majority of the argument has been against him. Nevertheless, there are some points to which I should like briefly to respond.

The noble Baroness, Lady Gould, picked up the view expressed by the Labour Party representative which is quoted in the Neill committee report. The idea that all Conservative Party members are rich is absolute nonsense, as those of us who have been involved in the party for many years know, and certainly as every Conservative MP, or, for that matter, candidate finds out every weekend in his or her constituency. It is also true--we on these Benches have come to recognise it--that some wealthy and generous individuals support the Labour Party and occasionally turn up to contribute to our debates.

However, there is also what I might call "the Green Party point". That was specifically considered by the Neill committee in paragraph 8.23 of its report. We have chosen very precisely in the amendment the definition recommended by the Neill committee. Of course it was open to any Member of the Committee to modify the definition in whichever way he thought appropriate. We stuck to the definition of the Neill

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committee, not just for the sake of sticking to the recommendation but also because we agreed with the argument. If registered political parties were chosen to be the beneficiaries, that would include all kinds of campaigning groups and so on, where it would be less appropriate.

The same point applies to the choice of £500 as the cut-off limit. We accepted the Neill committee's figure. I agree that it can be argued about in both directions--up or down. But no amendments were tabled in either direction. We support the Neill committee's recommendation but are keen also to establish the principle that lies behind it rather than confuse the debate by arguing about the detail of it. Similarly, on the administrative costs, we are entirely open to suggestions which might help the work of the Inland Revenue in ensuring that the scheme proceeded smoothly and was able to be managed in the most appropriate way to avoid misuse. I am not undertaking to accept any Inland Revenue amendment. I have seen enough Inland Revenue amendments to know that some of them go too far in stamping on these matters. But there it is.

The Minister discussed the question of direct state funding and rightly said that we do not think that that is desirable. The Conservative Party does not think that it is desirable, although I am not arguing against the ways in which it already happens--either through the Short and Cranborne moneys, which were referred to, or through the assistance in kind at the time of elections, with free broadcasts and so on. Sometimes we look across the Atlantic with horror at the enormous amounts of money being spent by American candidates in the elections. I refer not only to the presidential candidates but, particularly at this time in the American election cycle, all candidates. They seem to spend absolutely huge quantities of money. But most of that--or a large proportion of it--goes on buying television time. In order to get a comparable figure in this country, one has to take into account the free broadcasts that political parties are allowed, particularly at election times, although not only at election times. So there is already state funding in that sense. There is also tax relief at least as far as concerns inheritance tax.

The difference of this proposal from straight state funding for the ordinary activities of political parties centrally is, as the noble Lord, Lord Goodhart, pointed out, that it would directly link the relief received by the parties to the donations. However, I thought that theMinister might slightly have given the game away when, as another of his arguments against the proposal, he said that there is no public clamour for it. That means that it has not so far turned up in a focus group, or not very definitely, or for that matter in a poll of some kind. That is not necessarily a very good way to decide on policy, particularly when an extremely senior, wise and expert committee, appointed for the purpose to review the matter and to go into all the details--I refer to the Neill committee--made this recommendation.

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The noble Lord, Lord Clinton-Davis, suggested that the Government should consider the matter. I recommend to the Committee that we should give them time to do that, particularly as the Minister said that the Government would reflect on the debate, although he argued in the opposite direction. I certainly think that he should reflect on the debate. While he is doing that, please will he ensure that the Labour Party stops putting out press releases saying that the Bill implements the Neill recommendations? It is quite clear from the Minister's response to what has been said in the past hour that it does not do that in this very important respect. However, as I said, we should give the Government time to reflect. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Schedule 6 [Control of donations to individuals and members associations]:

4.45 p.m.

Lord Bach moved Amendment No. 182A:

    Page 114, line 28, leave out ("and") and insert ("or").

The noble Lord said: In moving this amendment, I wish to speak also to Amendments Nos. 182B, 182C, 186A, 187A and 189A. There are three opposition amendments in this group, Amendments Nos. 182D, 182E and 182G. If I may, I shall speak to them before they are moved.

The government amendments in this group fulfil a commitment given by the Parliamentary Secretary, Privy Council Office, Mr Paddy Tipping, during the Committee stage of the Bill in another place. It was suggested by the honourable Member for North Dorset, Mr Walter, that the disclosure threshold for donations to members' associations should be £5,000, rather than £1,000. His argument ran that members' associations, such as the Tribune Group or the Tory Reform Group, were national bodies not local bodies, and that in the interests of consistency the disclosure threshold should match that for donations to the central organisation of a political party.

We agree that there is some force in his argument, although members' associations will not exclusively be national bodies. The group of Labour councillors on Brighton and Hove Council could, for example, constitute a members' association for the purposes of Schedule 6 to the Bill. That said, we accept the point made by the Opposition Front Bench in another place and are content to raise the limit accordingly.

Government Amendments Nos. 182A, 182B and 182C address a matter of drafting only. The definition of a "controlled donation" for the purposes of Schedule 6 presently refers to a donation received by a person or members' association for their "use and benefit". However, the test should be whether a donation is made for either the use or benefit of the recipient. For example, a donation which took the form of services in kind could not be said to have been made available for the recipient's use but the recipient would nevertheless reap a benefit.

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I turn to opposition Amendment No. 182D. It is not precisely clear to me why the noble Lord, Lord Mackay, whose name is attached to the amendment, wishes to exclude from the ambit of Schedule 6 donations made to elective office holders in connections with their official functions. He may have in mind routine gifts given, say, by a visiting leader of a European centre-Right party to the Leader of the Conservative Party. I should be surprised if many gifts of that kind came above the £1,000 disclosure limit or even perhaps the £200 de minimis. In any event, the amendment does not make a distinction between such gifts and, say, a donation of £10,000 to the Leader of the Opposition to help him to run his office. Such a donation--£10,000--would be in connection with the discharge by the Leader of the Opposition of his official functions and ought to be subject to disclosure in the usual way.

Amendment No. 186E would require the electoral commission to issue guidance to regulated donees about what constitutes political activities. I remind the Committee that Clause 9 already enables the commission to issue advice to regulated organisations and individuals, so we do not see the need for a provision along these lines in Schedule 6. We are sure that the commission will be ready to assist regulated donees to meet their obligations under the Bill, including by offering guidance. But we should recognise that it would be difficult to compile comprehensive hard and fast rules on what is or what is not a political activity. The message to regulated donees is: if in doubt, ask.

In responding to Amendment No. 182G. perhaps I may say that we are grateful to the Opposition for drafting it. We accept the amendment. It is an improvement. I beg to move.

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