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1099 Political Parties and Elections Bill [LORDS] Political Parties and Elections Bill 1100 [LORD BATES] David Cameron has made in his personal pledge: an incoming Conservative Government would abolish the communications allowance as a first step and a gesture in that direction. We would seek to reduce the cost of politics and the size of the House of Commons. He has put his finger on the national mood at the moment, which is not inclined to put one penny more towards the political process in these straitened times but wants to see the system managed much more efficiently. It is up to the political parties, through interparty dialogue, to come up with ways in which that can be achieved. I would like to make a couple of other points about expenditure limits. There are many other forms of support that political parties receive from the public purse, a point that was raised in the Neill report and was touched on by Sir Hayden Phillips in his review, where he pointed out the value of freepost mailings of manifestos at election time and of political election broadcasts. Significant amounts of funding are there for the incumbent. We are not saying that there is not a problem; big money—I use the term again with no hesitation—needs to be taken out of politics. “Big money” refers not only to trade unions and major wealthy individuals but to the public purse as well. Some steps have been taken and it is worth putting on the record some of the progress that has been made in relation to national limits. We have just experienced a European election that had a national limit on expenditure. That was a good exercise and a good discipline to impose. The very Bill that we are talking about came forward with a limitation on pre-candidacy election expenses for certain general elections. It introduces a limit, which is a step in the right direction, as it acknowledges that we have to find ways of reducing the amount of funding that is going into constituencies. Section 18 talks about a system of limiting the amount of money expended, kicking in after the 55th month of a Parliament. However, there is an important corollary to the point about the limitations on pre-election expenses under the Bill. I would be grateful if the Minister could put some additional remarks on the record about this. The understanding was that that would be matched by a limitation of the communications allowance used during that period by Members in the other place in their constituencies. It seems only right and fair that any limit that applied to donation income should be matched by a gesture from the incumbent Members in limiting the amount that is spent through the communications allowance. Various statements have been made claiming that such a statutory instrument or convention would be in place by the time the Bill received Royal Assent. It would be good to hear that this is still very much the Government’s intention. I recognise the intention behind the amendments but, for the reasons that I have outlined, we do not want to support them at this stage. 5.45 pm Lord Bach: My Lords, this group of proposed amendments seeks to introduce a radical change in the regulation of political expenditure in this country. I pay tribute the noble Lord, Lord Tyler, and the, alas, not present noble Lord, Lord Rennard—whom we hope is getting better—for their passion and commitment to this particular point about national spend and constituency spend. I am unable to accept the amendments, but I hope that what I have to say will go a little way towards making the noble Lord realise that we want to move forward on this. I will not go through the amendments one by one. The noble Lord did not do so either. We recognise the broad shape of the amendments from Grand Committee. We are grateful that some rectification has been made of some of the problems and deficiencies that were identified in the previous versions of these amendments, but we have some concerns. For example, Amendment 67 would impose a five-year limit on a party’s spending but still fails to anticipate the problem of parties saving up the majority of their permitted spend until shortly before an election. In Amendment 68, we are concerned that smaller parties would face great difficulty in accurately calculating the level of their permitted spend, given that it cannot be known how many months will elapse between elections. These are small points, but I make them in case the noble Lord wants to deal with them. The transitional arrangements proposed in Amendment 70 appear to suggest that a party could spend 75 per cent of the permitted £61 million between July 2009 and the next election. That is probably a drafting error, but prescribing any figure in the manner of the amendment would be risky, given that we cannot know exactly when the election will be. Amendment 72 would require registered political parties to report annually on their qualifying expenditure under the proposed new system of spending limits, although it defines expenditure as that found in Schedule 4A to the 1983 Act. However, that schedule lists the regulated matters for the candidate’s spending limit, not the party’s campaign spending limit. That list of regulated matters is to be found in Schedule 8 to the 2000 Act. Amendment 71—and here I come to more major issues—would make two crucial changes to the list of regulated matters for candidates’ spending, as set out in Schedule 4A to the 1983 Act. First, it seeks to add spending on newsletters or similar publications, which is by the central party but relates to candidates. Secondly, it would add market research or canvassing activity to the list of regulated matters. The noble Lord, Lord Tyler, raised concerns about the current list of regulated matters for the candidate and campaign spending limits in Grand Committee. Election spending is, of course, regulated by separate limits, according to whether it is by or on behalf of a party, or by or on behalf of a candidate. This is clearly an important distinction. The noble Lord’s concern is that spending by a central party organisation, which might be specifically aimed to enhance the electoral prospects of an individual candidate, would not be recorded against that candidate’s spending limit. So we understand the point and the noble Lord’s concern, but we fear that the proposals would introduce further complexity into what is already a complex area of legislation. We are concerned that they could be
1101 Political Parties and Elections Bill [17 JUNE 2009] Political Parties and Elections Bill 1102 difficult to understand and operate in practice and could blur the respective roles and responsibilities of the election agent, central party and local party. In the White Paper that preceded this Bill, the Government stated that they would assess whether there is clarity over which expenses count towards the party campaign and candidate spending limits. We stated that we would bring forward proposals to update the lists of regulated matters. However, such changes would be made via secondary legislation rather than in this Bill. The Government will consult fully with all the major political parties and the Electoral Commission before bringing forward proposals for change. Any proposals would then be subject to full scrutiny by both Houses. The concerns that the noble Lord, Lord Tyler, raises and the changes that he proposes to make to Schedule 4A would best be addressed during the course of that consultation and those discussions. I understand that there is due to be a meeting of party administrators and officials from my department, the Ministry of Justice. This could be a productive issue to be considered at that meeting, which I believe is due to be held later this summer. This is a complex area of legislation and any proposal for change would have to be considered very carefully if we are to avoid the unintended consequences that are always a danger of introducing changes that have not been sufficiently considered. I can give no guarantee that it will be possible to address fully the noble Lord’s concern, not least as his proposal would be a significant change and we have concerns about the practical effect of such a step. However, I reassure him that we intend to look at the lists of regulated matters, and to do so not on a solitary or party basis—although he tempts me, I shall resist the temptation to be parti pris—but on a consultative and co-operative basis. To return to the main thrust of the debate, which we are grateful to the noble Lord for raising, this group of amendments is based, in a broad sense, on the package of recommendations on spending put forward by Sir Hayden Phillips, although there are some key differences between Sir Hayden’s suggested reforms and the amendments before us today. The noble Lord, Lord Tyler, mentioned the key one. Sir Hayden proposed that the whole of term limit should be £150 million, including a general election premium of £20 million. Sir Hayden’s proposals for the treatment of smaller parties also differed, and he did not propose introducing the new controls until after the next general election. These differences are significant. We are not considering the Hayden package of reforms with these amendments, but a revised version which has not come about as the result of cross-party talks and discussion. We have constantly stated that we broadly support the approach of comprehensive spending limits as proposed by Sir Hayden. However, we have also made it clear that there are concerns about how these could be made to operate effectively in practice. I talked about a meeting of officials and party administrators. Such a meeting has not yet been arranged but we will seek—I give that promise from the Dispatch Box—to arrange a meeting of the type I mentioned to take place this summer. We have also made the case—I know that the noble Lord, Lord Tyler, is not particularly happy with this—that it is necessary to proceed in this area only on the basis of cross-party consensus. We do not think that we can introduce fundamental changes to the regulation of party funding unless all the main parties are signed up to the way forward. That requires detailed discussion between parties and scrutiny of any proposals for change. That is what the Sir Hayden Phillips talks sought to achieve. Alas, they failed to settle on proposals that all parties could support. We have always said that this Bill is not intended to be the last word on party funding issues. We hope that, in the long term, cross-party agreement can be achieved. We do not believe such agreement exists in your Lordships’ House today. For that reason, we do not believe that this Bill is the correct place to introduce such a system. I hope the noble Lord will consider withdrawing his amendments on the basis of what I have said in my reply. The noble Lord, Lord Bates, mentioned the restriction post-55 months. My right honourable friend Michael Wills said on Report in another place that CA would be restricted for the longer regulated period introduced in Clause 18. That is a matter for the House of Commons to agree, not for the Government. Lord Tyler: My Lords, I am grateful to the Minister for the very careful and positive way in which he has responded to our amendments. I am sorry that his colleague, the noble Lord, Lord Campbell-Savours, is not in the Chamber, because he was so effective in demolishing this argument that everything has to be agreed by total consensus across the parties. I wonder what the Minister’s position would be if there was complete agreement between the Conservative and Labour Parties on an issue of this sort, but the Liberal Democrats did not agree. Would he still say that there was consensus, or would he say that the Liberal Democrats effectively had a veto on any agreement? The danger with the concept that we can do something in this field only when everybody is agreed is that we will not make any serious reforms to our political system at all. There will always be somebody who does not want to move. I have to say that we are usually rather more in advance when it comes to reform. However, this idea that consensus is essential, and therefore the slowest mover has a veto, is a dangerous new tendency in government. I do not see it in any other walk of life where government seeks to interfere or control. I hope I am not putting words into the Minister’s mouth, but I think that I can detect from what he is saying that the Government take very seriously the sort of anxieties and concerns that we have expressed. He did not say that he is seeking to reconstitute any cross-party discussions but I hope that it can be read into his words that he is not giving up on seeking to achieve some agreement, even if it is not complete, 100 per cent consensus. As he rightly says, his colleagues in the other place are increasingly anxious about the failure of the present regulations, particularly in terms of qualifying expenditure, to prevent interference on a scale that has never been experienced before. Not in the past 100 years has there been such considerable expenditure by national parties to encourage people to support local candidates within the constituency. He
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