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Lord Falconer of Thoroton: My Lords, his terms of reference certainly embrace that. The noble Lord's point is very important. There is state funding that can promote strong political activity of integrity at every level, including at local level. The stronger and more respected that political activity, the better for the health of our political system. We need to look not just at the issues of funding, for example, general elections, but funding local activity in communities.

Baroness Carnegy of Lour: My Lords, does the noble and learned Lord agree that the number of people who vote in general elections, which is worryingly low, is not unrelated to the way parties are funded, and would be closely related if there were certain changes to that way of funding? Would he also agree that it would be very much in the interests of the Phillips committee to look carefully at the report of the Power committee, chaired by the noble Baroness, Lady Kennedy of The Shaws? This has a number of very interesting findings and comments on that subject. Would he further agree that it would be wise of the committee to pay a good deal of attention to that report?

Lord Falconer of Thoroton: My Lords, I would certainly expect Sir Hayden Phillips's committee to look at the Power report, because it specifically addresses this issue. Political funding is one of the
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issues in the political system that causes the public concern. That is why it is so important that we operate together in a unified way to try to reach a solution.

Lord Marsh: My Lords, the noble and learned Lord referred to the need for consensus on this subject. It is obvious that there is a consensus among the three parties to come together on the best way of taking more money from the public and to reach that consensus so quickly that the public will not notice. That may well be the intention. But the serious point is that all politicians—I was an offender in the past—can do one thing above all else, which is to spend public money, in this case, for the benefit of the Government.

Lord Falconer of Thoroton: My Lords, I hope that people will not perceive what emerges as political parties coming together and thinking of ways of getting public money for themselves. One of the critical aspects of this matter is that there is not public confidence in funding arrangements at the moment. If funding arrangements involve state funding, that must be done on a basis that the public regard as satisfactory. The points made by the noble Lord, Lord Shutt, are very important because funding that improves the role of political parties at a local level may well be much more acceptable than state funding for, for example, posters in a general election campaign.

Lord Craig of Radley: My Lords, will the examination by Sir Hayden Phillips include the subject of Short money? If so, will the noble and learned Lord invite him to look at the level of funding for the Cross-Benchers?

Lord Falconer of Thoroton: My Lords, at the forefront of the crisis on political funding is the funding for the Cross-Benchers. Of all the people in the world who will put their concerns to the fore, Sir Hayden Phillips is the man.

Lord Mackay of Clashfern: My Lords, I understood that recommendations for the peerage are confidential until the time at which they are decided upon. The noble and learned Lord the Lord Chancellor said that he has no reason to suppose that the particular publications had come from No. 10. What investigation has he made about where they came from, and what was the result?

Lord Falconer of Thoroton: My Lords, I have made no investigation, but I make absolutely clear how much I deplore these names becoming public before any proper process has been gone through. I also regret that allegations were made by the Leader of the Opposition in this House that they had come from No. 10. I have no reason to suppose that that is right. It is wrong that people should make allegations about such a serious matter without first knowing the facts.

Lord Dubs: My Lords, does my noble and learned friend agree that if we were to separate serving in this
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House from having a title, we would have clarity in the process and the enthusiasm to be here that apparently exists outside the House would be lessened?

Lord Falconer of Thoroton: My Lords, I have assumed that noble Lords come here only to help with legislation and that they are not at all interested in the question of titles. However, I agree that when we come to second Chamber reform, we need to address the question of whether honours should be separated from one's role as a legislator.

Baroness Walmsley: My Lords, will the transparency and level playing field to which the noble and learned Lord has referred include the financial relationships between political parties and trades unions?

Lord Falconer of Thoroton: My Lords, it will include the relationships between political parties and any organisations, including trades unions. Sir Hayden Phillips's inquiry covers the whole of the funding of all political parties, and we need to look at how those relationships are affected by financing.

Lord Richard: My Lords, in the interests of the transparency that the Opposition is now demanding, and which the Government are prepared to accept, can my noble and learned friend tell the House whether, in the interests of that transparency, the Conservative Party has told him the extent of its loans and the Liberal Democrats have told him the extent of comparable loans to that party? Otherwise, it does not seem awfully transparent.

Lord Falconer of Thoroton: My Lords, neither the Liberal Democrats nor the Conservatives have told me anything, but that is hardly surprising.

Lord Pearson of Rannoch: My Lords, now that the Attorney-General has joined us in the Chamber, will the Lord Chancellor care to advance a little on his answers to my noble friend Lord Waddington and the noble Viscount, Lord Bledisloe, and say whether he and the Attorney-General will encourage prosecutions relating to the sale of peerages under the Honours (Prevention of Abuses) Act 1925?

Lord Falconer of Thoroton: My Lords, I think I have already answered that question twice.

Baroness Williams of Crosby: My Lords, I agree with the Lord Chancellor that we face a very serious crisis of confidence in our political system, but one of the aspects of political fundraising is that it sometimes goes beyond traditional methods. Will the Phillips committee discuss the activities of the noble Lord, Lord Levy, the fundraiser for the Prime Minister?

Lord Falconer of Thoroton: My Lords, Sir Hayden Phillips's remit is not to investigate individual cases but to consider the whole system of political funding, and that is what he will do.

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Identity Cards Bill

3.36 pm

The Minister of State, Home Office (Baroness Scotland of Asthal): My Lords, I beg to move that the Commons amendments be now considered.

Moved accordingly, and, on Question, Motion agreed to.

16 Clause 5, page 4, line 44, leave out "must" and insert "may, if the individual so chooses,"
22 Clause 8, page 7, line 42, leave out "must" and insert "may, if the individual so chooses,"

The Commons insist on their disagreement to Lords Amendments Nos. 16 and 22 but propose Amendments Nos. 22E and 22F in lieu.

22E Page 7, line 38, after "accompanies" insert "or includes"
22F Page 7, line 43, leave out from "manner" to the end and insert "ensure that an application to be issued with such a card accompanies or is included"

Baroness Scotland of Asthal: My Lords, I beg to move that the House do not insist on its Amendments Nos. 16 and 22, in respect of which the Commons have insisted on their disagreement, and do agree with the Commons in their Amendments Nos. 22E and 22F in lieu.

Amendments Nos. 22E and 22F were agreed by the other place on Thursday 16 March by a majority of 51 votes. They are technical amendments to Clause 8, which makes it clear that an application for an identity card must include or accompany one to be entered on the national identity register. I will also seek to persuade your Lordships not to accept Motion A1, tabled by the noble Lord, Lord Phillips of Sudbury, which would amend Motion A by adding Amendments Nos. 22G and 22H, which would delay the proposed automatic linkage between designated documents and identity cards so that it would apply only to applications made after 31 December 2011.

I will explain first why we believe that the amending Motion is not the helpful compromise which I am sure the noble Lord, Lord Phillips, intended it to be or which he may suggest it is to this House, but would do little more than reinstate Amendments Nos. 16 and 22, which would unpick the linkage between designated documents and identity cards, albeit for a limited time rather than indefinitely. I remind the House that we have debated these issues several times, but this issue has now been in three Bills and, if the amendment tabled by the noble Lord, Lord Phillips of Sudbury, found favour, we would have had the joy of discussing it in three Parliaments.

The noble Lord's Motion would mean that we would have to delay the requirement for applicants for designated documents to be registered and to obtain an identity card until the end of 2011—that is, after any new election. Although we might not expect to phase in the introduction of identity cards to all categories of passport applicants straight away, any constraint on designation would create uncertainties in our planning and would risk incurring additional costs. First, in line with other EU countries, we expect
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to start issuing biometric British passports that include fingerprints by 2009. Without the requirement for recipients of designated documents, such as biometric passports, to register on the national identity register and be issued with an identity card, we would have to provide for two alternative processes with separate records for those who chose to register and those who chose not to register. I am not saying that such processes would not be technically feasible, but such a purely artificial deadline would create real problems for the phasing of the scheme, all of which would be bound to impact on costs—something about which this House purported to have a great deal of concern.

Linking the issue of fingerprint biometric passports with identity cards makes sense and is the basis of the Government's planning for rolling out the identity card scheme as people renew their existing identity documents. As my right honourable friend the Home Secretary has already made clear, anyone who feels strongly enough about this linkage not to want to be issued with an identity card in this initial phase will be free to surrender their existing passport and apply for a new one before the designation order takes effect. However, I doubt whether very many people would want to avoid the opportunity of obtaining an identity card when their passport is renewed.

The House has focused very much on the impact on people applying for passports, but we are also likely to start issuing biometric resident permits to those foreign nationals temporarily resident here around the same time, in 2008 or 2009. Again, without the requirement for designation and registration on the national identity register, foreign nationals could opt out of the scheme and we would be forced to maintain separate records for those who opt in and those who opt out of the register. If in the initial stage registration was optional, there would be extra costs, even if this lasted only two or three years.

There would also be delays, not only in British passport holders being registered but also in foreign nationals being included on the national identity register. A change in the way in which the scheme is to be phased in would require considerable reworking of the current identity cards business plan and procurement strategy. This would create further delay in the programme and so could add to costs.

I could go on about the details but we now have the same argument for the fourth time. The Government say that the link should be made—and made now—with certainty and clarity so that procurement can go on. Members opposite say no; they want delay, they want procrastination and they want to put it off until after the next election. Members of the other place have had the advantage of thinking about this on three occasions. On a previous occasion when they discussed this, the vote against your Lordships' position was 33; it is now 51. On the previous occasion I indicated that I believed the voices in the other place would get louder. We now have a cacophony coming from them of "No", "No" and "No" again. They were asked to consider again and they have considered again.
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We are asking now for this House, having done its duty with such diligence and care, to determine that its proper function is to review, amend and suggest. The proper function of the other House, holding the mandate of the people of this country, is in the end to decide. Its Members will pay the price of that decision when the next election comes about; we, on our comfortable Benches, will not.

There are those who think that this Parliament should be unicameral. I would not like this House to give them any more basis for suggesting that that would be a good move.

We come to a position where I have to entreat the House to use its normal wisdom—something that I hope your Lordships brought into the Chamber today—and to decide that now, if not the previous occasion, is the appropriate time to let the other House have its way and bow, as we must, to their mandate.

Moved, That the House do not insist on its Amendments Nos. 16 and 22, in respect of which the Commons have insisted on their disagreement, and do agree with the Commons in their Amendments Nos. 22E and 22F in lieu.—(Baroness Scotland of Asthal.)

3.45 pm

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