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Viscount Astor: My Lords, we also support these draft rules. I can only echo the questions posed by the noble Lord, Lord McNally, about the setting up of the commission.

Lord Bach: My Lords, I am grateful to the noble Lord and the noble Viscount for their support. The noble Lord, Lord McNally, emphasised how important it is for a free society to ensure that elements of it who are perhaps the most unpopular--sometimes

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for good reason--are protected, as is everyone else by the rule of law. That is what we have sought to do both in the Act and by way of these draft rules. We have tried to maintain the appropriate balance between protecting society and protecting the rights of even the most evil people.

As regards when the commission's membership will be announced, I am afraid that I shall have to resort to the words that noble Lords will have heard many times from this Dispatch Box and, I suspect, from many governments: the names of those sitting on the commission will be announced in due course. However--and more importantly for the moment--the way that the composition of the commission will be established in any given case is as follows. One member of a three-person tribunal (such tribunals will consist of three people) must either hold, or have held, high judicial office. That is the only requirement as far as concerns the three members.

It is the intention that there will also be one other legally-qualified person and one "specialist" member present at each hearing. As for the question of who would qualify as that specialist member--people are now applying to become members of the commission--I can tell noble Lords that the advertisement for such applications specifies that that person should have extensive experience in one or more of the following areas: first, political or social sciences or other relevant areas of legal academic study; secondly, the Armed Forces, police or national security services; and, thirdly, the Diplomatic or Home Civil Service. Of course, legally qualified applicants must be barristers or solicitors with at least seven years' standing on 1st November last year. I hope that those comments are helpful. I beg to move.

On Question, Motion agreed to.

Companies (EU Political Expenditure) Exemption Order 2001

7.40 p.m.

The Minister for Science, Department of Trade and Industry (Lord Sainsbury of Turville) rose to move, That the draft order laid before the House on 17th January be approved. [4th Report from the Joint Committee.]

The noble Lord said: My Lords, the draft order seeks to exclude activities such as the publication of newspapers from the definition of "political expenditure" under Part IX of the Political Parties, Elections and Referendums Act 2000, while, at the same time, ensuring that the principles of accountability and transparency are properly applied in relation to political donations and expenditure by companies.

I should like briefly to remind noble Lords of the background to this draft order. The Neill committee's

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report on the funding of UK political parties recommended that any company intending to make a donation to a political party or organisation should be required to have the prior authority of its shareholders. The Government accepted this recommendation, and--with the blessing of the Neill committee--proposed both that the requirement should be extended to cover political expenditure by companies and that the disclosure requirements under the Companies Act 1985 should be amended to reflect the committee's recommendations.

At the same time, we are conscious that some companies carry on business activities which may, by their very nature, involve the publication or dissemination of material which seeks to influence the views of members of the public; journalism is an obvious example. It was, of course, not our intention that the carrying on of activities such as the publication of newspapers should be considered as incurring "political expenditure"; for that reason, the Government tabled an amendment at Third Reading to create an order-making power under Part IX of the Act to allow Parliament to exempt such activities from the requirement for shareholder authorisation.

May I emphasise that the order-making power under Part IX of the Political Parties Act does not extend to donations to political parties and organisations. Companies which may enjoy the benefits of the exemption will therefore remain subject to the full requirements of the Act in relation to such donations. I beg to move.

Moved, That the draft order laid before the House on 17th January be approved. [4th Report from the Joint Committee.]--(Lord Sainsbury of Turville.)

Viscount Astor: My Lords, we welcome the order just in time for the Prime Minister to announce the next general election. The main reason we welcome the order is that it will allow companies that own newspapers to be exempted from any possibility of having to apply for shareholder authorisation for those newspapers to state that they think that a particular party should win the next general election. As we consider that most newspapers are likely to state that the Conservative Party should win the next general election, we certainly welcome the order. Although the Minister was not involved in the legislation we are discussing, I am sure that he will have heard that the Government cherry-picked the Neill recommendations. Therefore we look forward to the Chancellor in the forthcoming budget--the Government having dodged the issue when the legislation went through this House--giving us tax relief on political donations.

Lord McNally: My Lords, as even the Guardian is usually "iffy" and wishy-washy about whether it should vote Liberal Democrat at general elections, we welcome the measure with absolute neutrality.

Lord Sainsbury of Turville: My Lords, I congratulate the House on its extremely fast and, I think, proportionate scrutiny of the order. The draft

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order reflects two equally important principles in our public and political life: the importance of transparency and proper accountability in relation to the funding of political parties and election and referendum campaigns, and the freedom of the press. I am sure that all noble Lords will agree with me that

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both principles should be properly applied in this country. That is the purpose of the draft order; for that reason, I commend it to the House.

On Question, Motion agreed to.

        House adjourned at sixteen minutes before eight o'clock.

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