House of Commons

Tuesday 10th September 2013 Commons Chamber

Tuesday 10 September 2013

The House met at half-past Eleven o’clock

Prayers

Tuesday 10th September 2013 Commons Chamber

[Mr Speaker in the Chair]

Oral Answers to Questions

Tuesday 10th September 2013 Commons Chamber

The Chancellor of the Exchequer was asked—

[John Cryer (Leyton and Wanstead) (Lab)]

1. What recent comparative assessment he has made of trends in real wages in the UK and in similar economies.

[The Chancellor of the Exchequer (Mr George Osborne)]

The hon. Gentleman asks about trends in real wages. The main deterioration in wages and salaries was from 2007 to 2009 when growth fell from 5.7% to minus 0.6%. This is a vivid reminder of the damage that the great recession did. The Government have taken continued action to help with the cost of living so that last year real household disposable income grew by 1.4%, the fastest growth for three years. Of course, however, these remain difficult times for families, and the only way to deliver improved living standards for the long term is a sustained, balanced economic recovery with low mortgage rates, more jobs and more income tax-free. Our economic plan is delivering that. The Opposition’s plan for more spending and more borrowing would make things worse.

[John Cryer]

Well, that is one of the most vacuous answers I have ever heard, and that is against some very stiff competition. In the past three years real wages in this country have fallen lower than in any G20 country bar one—we are second from bottom. For how long is that going to be sustainable?

[Mr Osborne]

Let us be clear: this country had one of the deepest recessions of any of the countries in the G20 or anywhere else. We had one of the biggest banking crises and our country has had to recover from that, but I point out that in the hon. Gentleman’s own constituency there are now 12,000 more people in work than at the time of the election, and unemployment is down by a third.

[Mr Andrew Tyrie (Chichester) (Con)]

What contribution has real wage restraint in the private sector made to the surprisingly low level of insolvencies in the UK compared with our competitors, which is now enabling more firms to take advantage of the recovery than would otherwise be the case?

[Mr Osborne]

My hon. Friend is absolutely right that wage restraint in the private sector and the public sector has helped preserve jobs during the economic shock that we experienced under the previous Government. That is partly a credit to the labour market flexibility of the policies that previous Governments introduced in the 1980s and early 1990s and the last Government did not reverse. The wage restraint has helped us preserve more jobs than would otherwise have been the case in the public sector, which is why at least until recently it was supported by the Labour party.

[Graeme Morrice (Livingston) (Lab)]

23. Will the Chancellor confirm, however, that after three years of flatlining growth and with prices still rising faster than wages, working people are on average £1,500 a year worse off than in 2010?

[Mr Osborne]

People have been helped with their low mortgage rates which our credible economic policy is delivering. They are helped by the increase in the personal allowance—£600 this year, £700 next year. They will be helped by our tax-free child care, but above all they are helped by an economy that is turning the corner. The worst thing for living standards, the worst thing for household incomes, would be a return to the disastrous economic policies of the Labour party.

[Mr Julian Brazier (Canterbury) (Con)]

Does my right hon. Friend agree that the trend in real wages further emphasises the need to hold down social security spending?

[Mr Osborne]

Of course, the key thing about social security and welfare is that it should encourage people into work. One of the remarkable achievements of my right hon. Friend the Secretary of State for Work and Pensions is that the number of workless households is now at a record low in this country. That is a huge achievement. Since the Opposition have been raising all these questions about living standards and wages, perhaps they would like to hear what the right hon. Member for Birmingham, Hodge Hill (Mr Byrne), a member of their shadow Cabinet, has been saying. He said:

“From 2004 onwards…families on ‘median incomes’—millions of workers—…were feeling the strain…people were working just as hard as ever—but were not getting on”.

He presented his findings to the Cabinet in 2010 but they got buried:

“We picked it up too late. It was very late in the day, is the truth”.

[Rachel Reeves (Leeds West) (Lab)]

The truth is that working families have paid the price for the three years of flatlining under this Chancellor. Prices have risen faster than wages for 37 of the 38 months that he has been in office. I have a quiz question for the Chancellor this morning. Can he tell the House which one of those 38 months is the odd one out and why?

[Mr Osborne]

First, may I welcome the hon. Lady back and congratulate her and her husband Nick on the birth of their baby, Anna?

There has been wage restraint in the public sector, but I thought that, as shadow Chief Secretary, the hon. Lady supported that. When she gave her speech about fiscal discipline before going on maternity leave, she supported wage restraint in the public sector. I am not clear whether she has changed her policy.

[Rachel Reeves]

The right hon. Gentleman obviously does not get the bonus point. He might find the truth embarrassing, but I must tell the House that the only month in which real wages rose was the month when bank bonuses soared by 80%, as the highest paid took advantage of his tax cut for millionaires. Rather than cutting taxes for the richest, why does he not help families facing the cost of living crisis on his watch?

[Mr Osborne]

When the shadow Chancellor was the City Minister, bank bonuses were £14 billion a year. They are now a fraction of that. Indeed, the income tax rate in every year of this Government is higher than in any year of the previous Government. By the way, inequality is now at its lowest level in this country since 1986. We have taken difficult decisions and tough action to ensure that our economy turns the corner. All those things were opposed by the Labour party, but as a result, because of low mortgage rates, because of the large tax-free allowance and because we are creating jobs in the economy, we can hold out the prospect of an improvement in the long-term living standards of the British people.

[Mike Thornton (Eastleigh) (LD)]

Does the Chancellor agree that taking 2.7 million taxpayers out of income tax through a higher allowance—a Liberal Democrat policy—will help improve living standards?

[Mr Osborne]

It is a policy being delivered by a Conservative Chancellor and a Liberal Democrat Chief Secretary. The hon. Gentleman is right that together we have taken millions of the low-paid out of income tax. Of course, that is also delivering a tax cut to 25 million working people, and there is more to come next April. It is one of the ways that, by securing the economic recovery and having credible policies with the public finances, we can help people by, for example, increasing the tax-free allowance.

[Kerry McCarthy (Bristol East) (Lab)]

2. What recent assessment he has made of the effect of fiscal policy on family incomes.

[Stella Creasy (Walthamstow) (Lab/Co-op)]

8. What recent assessment he has made of the effect of fiscal policy on family incomes.

[Pat Glass (North West Durham) (Lab)]

10. What recent assessment he has made of the effect of fiscal policy on family incomes.

[The Economic Secretary to the Treasury (Sajid Javid)]

The Government have published distribution analysis for all our fiscal policies at each fiscal event, and we are the first Government to do so. The most recent assessment was at the 2013 spending review, and the analysis showed that the richest 20% of households continue to make the greatest contribution to reducing the deficit, both in cash terms and as a percentage of their income.

[Kerry McCarthy]

I thank the Minister for that reply, although he completely failed to talk about the real issue that I was hoping to raise: the extent to which ordinary families are being hit incredibly hard by the Government’s policies. We are hearing from Citizens Advice that inquiries about food banks have risen by 78% over the past six months, and one in four families is having to borrow to provide school uniforms. What are the Government doing about those real issues affecting real people?

[Sajid Javid]

I must say that if the hon. Lady is genuinely interested in the challenges that families face, she should recognise the causes: Labour’s recession, the deepest in our post-war history; Labour’s record budget deficit, the deepest in our post-war history; and Labour’s bank bail-outs, the largest the world has ever seen.

[Stella Creasy]

With working families’ incomes on average 1,500 quid down and millionaires taking tax cuts, does the Minister really think that we are all in this together?

[Sajid Javid]

As the hon. Lady has already heard, all millionaires will be paying a higher tax rate under this Government than they did for the whole 13 years that the Labour party was in power. She should also welcome the tax cut we provided for the lowest income families, 25 million people, with 2.7 million taken out of taxation altogether. I note that the Labour party has recently talked about reintroducing the 10p tax rate, which they abolished. Well, I have news for it: all those people are now paying a 0% tax rate on that income.

[Pat Glass]

The Times leads this morning on yet another banking scandal that has cost savers in this country billions of pounds. At the same time, bonuses in the financial sector have risen by 90% and ordinary families are really struggling. It is simply not working, so when will the Government step in and do something about the regular obscenities in the banking industry?

[Sajid Javid]

The hon. Lady should look up the facts. Bank bonuses reached their peak when the shadow Chancellor was City Minister; today they are almost one seventh of what they were at that time. The hon. Lady should welcome the measures we have taken to help working families. They have helped reduce interest rates and keep mortgage rates low, meaning that the average family with the average mortgage are paying £2,000 less per year than they did under the previous Government.

[James Morris (Halesowen and Rowley Regis) (Con)]

If it had not been for the Government’s council tax freeze, and if council tax had continued to rise on the trajectory set under the previous Government, the average bill would now be £200 higher. Does the Minister agree that the steps taken by the Government are helping hard-working families keep their council tax bills down?

[Sajid Javid]

My hon. Friend is absolutely right. That council tax freeze is helping families up and down the country, as are many other measures we have taken, such as the cap on rail fares.

[Mark Garnier (Wyre Forest) (Con)]

Household debt peaked in 2008 at 170% of household income. Since then it has come down, but households are still very vulnerable to rising interest rates. Does my hon. Friend agree that any fiscal policy must give comfort to the bond markets in order to help the Governor of the Bank of England keep interest rates low and mitigate the effect of rising rates on households?

[Sajid Javid]

My hon. Friend is obviously referring to the fact that when this Government came to office, we had the biggest deficit in our post-war history. The previous Government were borrowing £5,000 a second—£300,000 each and every minute. We have reduced that deficit by a third and, as my hon. Friend suggests, that has brought confidence, investment and jobs.

[Andrea Leadsom (South Northamptonshire) (Con)]

Does my hon. Friend worry, as I do, that the worst outcomes for children are in those families where nobody is working? If so, is he as delighted as I am that our economy has generated 1.25 million new private sector jobs since 2010, thereby improving the prospects of millions of children?

[Sajid Javid]

My hon. Friend correctly highlights that the best way out of poverty is through work. As she says, the private sector has generated almost 1.3 million jobs over the past three years. In fact, it is the fastest rate of job creation in the G7.

[Susan Elan Jones (Clwyd South) (Lab)]

17. The Chancellor said recently that he knew that times were tough and that family budgets were being squeezed. Why, therefore, did this Government choose to prioritise a tax cut for those on the 50% rate?

[Sajid Javid]

Perhaps the hon. Lady missed it, but we have made sure that the people who earn the most in our society are making the biggest contribution to the necessary measures we have to take to make sure that the country lives within its means. In each year of this Government, the richest will pay a higher tax rate than under the Government she supported.

[Stephen Williams (Bristol West) (LD)]

Does the Minister agree that, come next April, a family where both parents earn wages will be £1,400 better off than they were in 2010, and that a child of theirs who works on the minimum wage—perhaps in the city centre of my constituency—will be lifted out of income tax altogether?

[Sajid Javid]

My hon. Friend is absolutely right. That is a big boost to family incomes. In fact, someone on a minimum wage who is working full time will find that their tax bill is more than halved as a result of this Government’s policies.

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

The reality is that, because of this Government’s warped priorities, women are paying three times more than men to bring the deficit down. Will this all-male Treasury team explain how that is helping families manage the cost-of-living crisis?

[Sajid Javid]

The hon. Lady knows all about unemployment, because she is probably thinking about the record rise in unemployment that took place in her constituency during the last term of the Labour Government. That record rise included men and women. In all categories it has fallen under this Government, and today more people, including more women, are employed in Britain than at any time in our history.

[George Freeman (Mid Norfolk) (Con)]

Does my hon. Friend agree that the single most important contribution to household earnings is having a job? Has he seen the latest data that show that the claimant count is now lower than in May 2010, that there are 500,000 vacancies, and that five jobs are being created in the private sector for every one lost in the public sector, leading the ManpowerGroup to say that this is a “game-changing year” for the UK jobs market? Is it not the truth that plan A is working and plan B is redundant?

[Sajid Javid]

As always, my hon. Friend speaks the truth very eloquently. The economy is growing. Of course there is a lot more work to do, but there is plenty of evidence that we have turned a corner.

[Yvonne Fovargue (Makerfield) (Lab)]

3. What recent estimate he has made of the effect of fiscal policy on the level of child poverty.

[Gavin Shuker (Luton South) (Lab/Co-op)]

9. What recent estimate he has made of the effect of fiscal policy on the level of child poverty.

[Lilian Greenwood (Nottingham South) (Lab)]

11. What recent estimate he has made of the effect of fiscal policy on the level of child poverty.

[The Economic Secretary to the Treasury (Sajid Javid)]

The Government have protected vulnerable groups as far as possible while urgently taking action to tackle the record deficit we inherited. Work remains the best and the most immediate way out of poverty, and the Budget took action to support families and make the tax and welfare system simpler, including further increases in the income tax allowance to take 2.7 million people on low incomes out of tax altogether.

[Yvonne Fovargue]

The chief executive of Citizens Advice, commenting on the huge rise in inquiries about food banks, said:

“The combined impact of welfare upheaval, cuts to public spending, low wages and the high cost of living are putting unbearable pressure on many households, forcing them to seek emergency help putting food on the table.”

Is the Minister concerned by this evidence, which is backed up by the recent statistic showing that 300,000 children have been pushed into absolute poverty since this Government took office?

[Sajid Javid]

The hon. Lady did a lot of good work with Citizens Advice before she came to this House, so I think she shares with me a genuine interest in child poverty. If that is the case, she will recognise that the existing measure for child poverty is flawed. It is based on relative incomes and it produces perverse results. For example, according to that measure, during the previous recession—Labour’s recession, the deepest in our post-war history—child poverty fell by 300,000. The hon. Lady knows that that cannot be right, so if she wants to work with me to help develop a measure that actually works, I would welcome that.

[Gavin Shuker]

Despite the Minister’s divisive rhetoric about benefits, two thirds of all children living in poverty have one or more parents in work, not out of work. Does he not accept that his inaction on prices and wages is not just hammering those young people but hammering the rest of us as well?

[Sajid Javid]

Work remains the best and the most immediate way out of poverty. The hon. Gentleman will be concerned that his constituency saw a 72% rise in unemployment during Labour’s last term in office. It has now fallen under this Government. He is rightly concerned about workless households, so he should welcome the fact that the number of children living in workless households is at an all-time low—the lowest since records began in 1996.

[Lilian Greenwood (Nottingham South) (Lab)]

Thirty-two per cent. of Nottingham children live in poverty compared with a national average of 20%, and we have the worst affected local authority in the east midlands. For all the Government’s warm words on early intervention, the city’s early intervention grant has been cut by £2.8 million. Is it not the case that across the country this Government’s policies are making child poverty worse?

[Sajid Javid]

I have taken five questions from Opposition Members so far, and not one of them has mentioned plan B; I wonder why. It is not very nice for Mr B. The best way to deal with poverty is by tackling the causes of poverty, and work remains the best way out of poverty. The hon. Lady should welcome the fact that jobs are growing at a record rate in our country, with 1.3 million jobs generated in the private sector in three years and more people employed than at any other time in our history.

[Paul Uppal (Wolverhampton South West) (Con)]

By any modern measure, my childhood was one of poverty, and strictly speaking I was homeless. The route out of poverty was provided by the creation of a sound economic environment and a belief in economic optimism. Does the Minister agree that that is as pertinent today as it was 30 years ago?

[Sajid Javid]

I absolutely agree with my hon. Friend. One of the many things we share in common, apart from both being west midlands MPs, is that by the official measure I was also homeless as a child. I agree with his assessment that the best way out of poverty is through work and a growing economy.

[Stephen Mosley (City of Chester) (Con)]

Another excellent way out of poverty is giving children from disadvantaged backgrounds the best education possible. How many children are benefiting from the £2.5 billion that has been put into the pupil premium, which will, in the long term, boost their educational chances and their chances of obtaining work?

[Sajid Javid]

My hon. Friend is absolutely right to raise education as another way of tackling the causes of poverty. Thousands of children up and down the country are benefiting from the pupil premium and the further educational reforms that are taking place, not least the focus we put on apprenticeships.

[Andrew Selous (South West Bedfordshire) (Con)]

Is not the real truth about child poverty the fact that median hourly pay rose by only 0.3% a year between 2003 and 2008? The only real answer for the United Kingdom economy is for it to be a high-skill, high-value-added economy. Our school reforms, and in particular our poverty-busting university technical colleges, are the answer to the problem.

[Mr Speaker]

The question is about fiscal policy, so a very brief reply will suffice. We are grateful to the Minister.

[Sajid Javid]

Despite taking action to ensure the country starts living within its means again, the Government have found money in their budget, because of their fiscal policy, to spend on schools and education, and ensure we increase skills. That includes building more university technology colleges and pledging more funding to do so.

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

21. According to the Institute for Fiscal Studies, by 2020 an additional 1.1 million children will be living in poverty, which will completely wipe out the reduction in the number of children living in poverty made under Labour. Why do the Government’s choices give tax breaks to millionaires and send more children into poverty?

[Sajid Javid]

I am sure the hon. Lady knows that the best way out of poverty is through increased pay and employment. I therefore do not understand why she does not welcome the fact that jobs are being created at a record rate throughout the economy, including in her constituency where I note that during Labour’s last term, youth unemployment rocketed by 120%. It is down by 14% under this Government.

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

My hon. Friend is right to say that the way out of poverty is to work. Does he agree that by reskilling people we can ensure that British people fill highly skilled jobs, and not rely on mass immigration to fill the skills gap?

[Sajid Javid]

I agree with my hon. Friend. The best way to get more British people into British jobs is to ensure they have the skills to do those jobs. That is exactly what the Government are focused on.

[Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)]

Families up and down the UK who are struggling with the cost of living simply will not recognise the rosy picture that the Minister is painting. Is the reality not shown in a recent report from the Child Poverty Action Group and the Joseph Rowntree Foundation, which states that changes brought in by this Government mean that families on low wages now have less than they need for a minimum acceptable living standard? That failure is on this Minister’s watch. Is it a record he is proud of?

[Sajid Javid]

It is not clear what the hon. Lady is proposing. Is she saying that she is against some of the changes we have made on welfare? Is she pledging more spending, more borrowing, and more debt? The Labour party need a policy on those issues. Our policies are clear: to deal with poverty we are focused on trying to generate even more growth. The economy has turned a corner; there is more to do but jobs are being generated in Britain at a record rate.

[Mr Dave Watts (St Helens North) (Lab)]

4. Whether he plans to introduce a land tax.

[The Exchequer Secretary to the Treasury (Mr David Gauke)]

The Government have no plans to introduce a land value tax at this time. In our view, the complexity and cost of administering such a tax, and, more importantly, the likelihood of a significant increase in tax bills for many council tax payers, particularly those such as pensioners with liquid assets, means that such a proposal is not tenable.

[Mr Watts]

I thank the Minister for his response, but given that we have massive increases in house prices, massive increases in the value of farmland and builders and supermarkets land-banking and pushing up the price of land, and given that 1% of the population own 69% of our total land mass, is it not time for action? Do we not need a land tax?

[Mr Gauke]

The hon. Gentleman will be aware that some of the construction numbers of late are much more encouraging, and the Government are taking action to improve house building, including our Help to Buy proposal. Believe it or not, not every problem this country faces can be solved by another tax.

[Steve Brine (Winchester) (Con)]

5. What recent steps he has taken to support small businesses.

[Dr Phillip Lee (Bracknell) (Con)]

13. What recent steps he has taken to support small businesses.

[The Chancellor of the Exchequer (Mr George Osborne)]

This year the Government are taking further steps to help small businesses. We have increased the investment allowance tenfold, and from next April we will introduce a new employment allowance worth £2,000 for every small employer, taking around one third of small employers out of employer national insurance contributions altogether. From next Monday we will help small businesses get the best deal from their banks by guaranteeing that they can switch their accounts within seven days. That service will also be available to families, which is real choice and competition in banking being introduced by the Government.

[Steve Brine]

I thank the Chancellor for that answer. I know he will want to welcome the new business centre I opened recently in the centre of Winchester, which is part of our plans to find and develop new start-ups. That is all happening in the light of increased business confidence, increased takings and reduced vacancies on the high street. Will he therefore join me in backing Winchester city council, which is working strongly in partnership with the business improvement district to help drive recovery in my area?

[Mr Osborne]

I certainly welcome that. I met members of my hon. Friend’s local authority who came to Downing street to tell me about the business improvement district. That involves the local council, the local MP and local businesses working together to attract jobs and investment to Winchester. I congratulate him on the leadership he has shown.

[Dr Phillip Lee]

In the past year, 502 small businesses have been set up in my constituency, which is a 12.6% increase on the previous year. Does the Chancellor agree that further extending rate relief to new small businesses will both help them and inspire other people to set up new businesses in the economically vibrant part of the world that I have the privilege to represent?

[Mr Osborne]

We have had rate relief for small businesses—I have announced that in previous fiscal statements, and my hon. Friend must wait for further announcements—but we are also helping businesses with the employment allowance. That major change in the tax system means we are taking a third of small businesses out of employer NICs. Four hundred and fifty thousand small businesses will benefit, which I hope is welcomed on both sides of the House.

[Ms Margaret Ritchie (South Down) (SDLP)]

Given the need to underpin local economies, what progress has been made toward reviewing the current approval criteria for a simplified import VAT accounting scheme? That would enable new businesses, but particularly import businesses, to be underpinned.

[Mr Osborne]

I will write to the hon. Lady on her specific point, to which I do not currently have an answer. However, more broadly, the Government are open to ways in which to make the VAT system and the business tax system simpler. We have created the Office of Tax Simplification, which has specifically looked at the burden on small businesses. I will take what she says as a submission.

[Mr Geoffrey Robinson (Coventry North West) (Lab)]

I wonder whether I could yank the Chancellor out of his complacency for one moment. Is he aware that, in the year since the funding for lending scheme was announced, lending to small and medium-sized businesses is, on the most recent figures, negative? Is he aware that that is symptomatic of a broader failure on investment under his reign?

[Mr Osborne]

Gross lending is up under the funding for lending scheme, which we operate jointly with the Bank of England. We are aware of the specific challenge of small business finance, which is why, just before the summer, with the previous Governor, we launched a focus of the scheme on small business funding.

The hon. Gentleman says investment is failing under this Government. He is an MP from the midlands. Given his personal history, I would have thought he would welcome the announcement by Jaguar Land Rover of the 1,700 jobs being created in Solihull. As he well knows, four years ago there was a choice of closing either Castle Bromwich or Solihull. Not only are both open, but a huge investment in the new technology of ultra-light cars is coming along with 1,700 new jobs. The hon. Gentleman is a midlands MP and used to work for the company, so I would have thought he would welcome that.

[Mr Brooks Newmark (Braintree) (Con)]

19. I met the Braintree district business forum last week. The feedback was very positive—the economy is turning around and demand for business is growing—but, as businesses grow, they face a working capital squeeze. What are the Government doing to enable businesses to access working capital more easily?

[Mr Osborne]

The business bank is up and running, and £300 million is in the market to help support small business lending. My hon. Friend has gone around the country promoting some of the investment tax breaks we have provided, such as the seed investment tax break, which provides that crucial, early-stage capital so that the many businesses now being created have the money to grow.

[Michael Connarty (Linlithgow and East Falkirk) (Lab)]

I am glad the Chancellor mentioned the banks. The small businesses in my constituency report that the predatory and risk-averse nature of the banks is still their biggest problem. One particular company has large contracts, including one in Parliament, which the banks have funded and which has just got started on time—the company is tooling up. However, the bank is now talking about stripping its assets and threatening its viability. What can the Chancellor do to stop banks in this country being so risk-averse and get them to support business?

[Mr Osborne]

That is a good question from the hon. Gentleman. The repair of the financial system perhaps remains one of our biggest domestic economic challenges. We are conducting a review of the future structure of the Royal Bank of Scotland and I will report back to Parliament this autumn on that specifically. More generally on the banking system, the funding for lending scheme, as a monetary intervention, has helped to support lending. Account switching, which will be possible from next Monday as the result of Government pressure, will help small firms to change their bank account much more easily and, as a result, get a better service.

[Simon Kirby (Brighton, Kemptown) (Con)]

20. Unemployment in Brighton Kemptown is falling, although there is still much to do. Does my right hon. Friend agree that the £2,000 cut in jobs tax will help small businesses in Brighton take on more staff and get even more people into work?

[Mr Osborne]

My hon. Friend is absolutely right. It is not just jobs that are being created in Brighton; there has been an increase in the number of businesses being created, too. Employment allowance is coming in and people will see that as a real way of helping small businesses with the cost of labour. That should help them employ more people and help the people who are already employed. That is just one example of what we are doing to ensure that this is a balanced private sector recovery, and that we do not repeat the mistakes of the past.

[Dame Anne Begg (Aberdeen South) (Lab)]

Her Majesty’s Revenue and Customs expects businesses to provide real-time information, which a lot of small businesses find either very difficult or impossible to do. What help will be put in place to ensure that they are able to move on to the new system? Even if universal credit eventually comes into being, it will depend on that information.

[Mr Osborne]

Some 90% of businesses are on real-time information. Of course, the transition to any new system is a challenge, but the new system will be much easier for small businesses, and all businesses, to keep an accurate account of their tax payments, and that will help them. We have phased it in so that small businesses, in particular, have time to prepare. This is a real improvement on a tax system that was many decades old and had not kept up with modern technology.

[Sir Bob Russell (Colchester) (LD)]

Will the Chancellor consider abolishing business rates for small retail establishments, and to make that fiscally neutral by putting a levy on out-of-town car parks?

[Mr Osborne]

I am not sure about the out-of-town car park part of the question, because I want to encourage retail and employment wherever they happen. We are aware of the challenge on our high streets, particularly for small retailers. The Government have, in previous Budgets and autumn statements, extended relief from business rates for small businesses, which has meant that many of the smallest firms do not pay business rates. I will take the suggestion as a good submission for a future fiscal statement.

[Ann McKechin (Glasgow North) (Lab)]

6. What recent progress he has made on implementation of the mortgage guarantee scheme.

[The Financial Secretary to the Treasury (Greg Clark)]

The Government are making good progress in working with mortgage lenders to introduce the mortgage guarantee scheme from January 2014. The scheme would allow people who can afford repayments on a mortgage but do not have a large deposit to own their own home.

[Ann McKechin]

The dangers of feeding a housing bubble are real. According to the Office for National Statistics, house price inflation in Greater London is four times higher than in the rest of the United Kingdom. Will the Minister confirm his assessment as to the extent that funds spent on the scheme in Greater London will exceed their pro rata share, based on the UK’s population?

[Greg Clark]

The scheme comes into effect in January. Government Members believe that home ownership should not be reserved for the well-off and the children of the well-off, which is why we are introducing this measure. The average deposit has risen to 79% of the income of a first-time buyer. That is why we are introducing the scheme: we are determined to help ordinary working people who want to own their own home.

[Mr Marcus Jones (Nuneaton) (Con)]

I recently met a constituent who purchased a one-bedroom flat at the height of the boom when she was single. She is now married and expecting her first child. They are desperate to move but are in negative equity and cannot move, despite having two good incomes and good savings. Will the mortgage guarantee scheme offer a positive solution for my constituents, and how can they access the scheme?

[Greg Clark]

Yes it will. The scheme is available to purchasers who already own their own home but want to move to a bigger one, perhaps because, like my hon. Friend’s constituents, they have had children. They are currently trapped in the home they have bought, and that is why the scheme we are introducing is important. It will allow people who can afford to pay the mortgage to achieve their dream of home ownership.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

The mortgage guarantee scheme does nothing to help housing supply. In those circumstances, many organisations suggest that the scheme will be inflationary. What is the Minister doing to reassure those who are concerned that the scheme will increase house price inflation?

[Greg Clark]

The hon. Gentleman is wrong to say that the scheme has done nothing to encourage supply; 10,000 homes have been started under the current scheme. The Home Builders Federation itself has said that a lack of affordable mortgage availability remains the biggest constraint on housing supply. That is a problem; we are solving it.

[Miss Anne McIntosh (Thirsk and Malton) (Con)]

7. What his policy is on the payment of corporation tax by foreign-based companies; and if he will make a statement.

[The Exchequer Secretary to the Treasury (Mr David Gauke)]

The Government are committed to creating the most competitive corporation tax regime in the G20 to support investment that drives economic growth. We want a system that is stable and fair with all companies abiding by the rules and making their contribution. We are cutting the rate to 20% by 2015, clamping down on avoidance and aggressive tax planning and driving forward multilateral efforts to modernise the international tax framework.

[Miss McIntosh]

Will my hon. Friend join me in celebrating the water industry, a flagship industry since its privatisation over 20 years ago? Will he explain to the House the benefit to consumers of deferring corporation tax against current foreign investment received?

[Mr Gauke]

We need investment in infrastructure, including water and my hon. Friend is right to highlight the work being done on that. We want a tax system that ensures that everybody pays their fair share, but also encourages that type of investment.

[Nigel Mills (Amber Valley) (Con)]

12. What recent progress he has made on his plans to tackle tax avoidance.

[The Exchequer Secretary to the Treasury (Mr David Gauke)]

The Government continue to make strong progress on tackling tax avoidance. Following on from our announcement at Budget 2013, we have introduced the UK’s first general anti-abuse rule, which will act as a significant deterrent to abusive avoidance. We have completed our consultations on avoidance using partnership rules and the use of offshore intermediaries, and we have just launched a consultation on new information requirements and penalties for the promoters of tax avoidance schemes.

[Mr Speaker]

I would like to wish the hon. Member for Amber Valley (Nigel Mills) good luck for his forthcoming wedding. I trust all will go as smoothly as his question.

[Nigel Mills]

Thank you, Mr Speaker.

I welcome the measures that the Minister has announced. My constituents want to see everyone paying the tax they owe on their income. Does the Minister think that any measures are required to make sure that trade unions do that as well?

[Mr Gauke]

First, I add to the words of Mr Speaker and, perhaps, wish good luck to my hon. Friend’s future wife. He draws attention to a story that we have seen in the last few days: allegations of tax avoidance against Unite and against Labour. Maybe the links between the two are closer than we realised.

[Stewart Hosie (Dundee East) (SNP)]

While it is right that we all press down on active tax avoiders, a number of small businesses that find themselves categorised as such are simply unable to pay the correct amount. Does the Minister think that the average of 29 minutes that it can take for the Revenue to answer a telephone call, the fact that the tax code has reached 11,500 pages, the closure of local offices and the reduction in Revenue headcount—things for which he is responsible—might be contributing to this, at least in some way?

[Mr Gauke]

On support for small businesses, HMRC has in place a time-to-pay arrangement. On the service that is provided by HMRC, it is always seeking to improve and deal with telephone calls and letters as efficiently as possible. But we have to bear in mind that the yield that HMRC is bringing in is increasing by £10 billion over the course of this Parliament. HMRC’s performance on phone calls and letters is better than it was when we came to office. It has made considerable progress and that should be acknowledged.

[Neil Carmichael (Stroud) (Con)]

15. What recent assessment he has made of the contribution to the economy made by the manufacturing sector.

[The Financial Secretary to the Treasury (Greg Clark)]

Manufacturing output grew in the most recent quarter by 0.7%, contributing to the growth of the economy as a whole. Growth was broadly based. In June, output increased in all 13 of the published manufacturing sectors, the first time that this has happened since 1992. The whole House will welcome today’s news that Jaguar Land Rover is to create a further 1,700 new jobs in the west midlands and 24,000 jobs in the supply chain.

[Neil Carmichael]

I thank the Minister very much for that answer. Does he agree that the news that manufacturing output has increased to its highest level in 20 years, as exemplified by firms such as Renishaw, Xograph and Delphi in my constituency, represents a good start to the rebalancing of the British economy?

[Greg Clark]

My hon. Friend is absolutely right. I pay tribute to him for doing his bit in an important cluster of manufacturing businesses in Stroud. He has invented and promoted the festival of manufacturing and engineering in Stroud, which will take place between 11 and 15 November, helping to give a further boost to the already successful companies in Gloucestershire.

[Andy Sawford (Corby) (Lab/Co-op)]

According to the Office for National Statistics, Corby is the manufacturing capital of the UK, but over the past three years our businesses have survived despite this Government’s policies not because of them. Will the Minister look again at the decision to pick winners in the boat-building industry and not to award money from the regional growth fund to my local firm, Fairline Boats?

[Greg Clark]

The hon. Gentleman is wrong in his assessment. He failed to say that the 13% collapse in manufacturing happened during the last three years of the previous Government. In the first three years of this Government, it has recovered. He mentioned the regional growth fund—paying tribute, I assume, to another successful intervention, which has helped firms such as JLR and will help others, including in the east midlands.

[Emma Reynolds (Wolverhampton North East) (Lab)]

16. What recent progress has been made on implementation of the national infrastructure plan.

[The Economic Secretary to the Treasury (Sajid Javid)]

The Government will invest £300 billion over the next Parliament on infrastructure projects, including a pipeline worth more than £100 billion, and covering investment in transport, schools, science, housing and flood defences.

[Emma Reynolds]

Since the Government took office, tens of thousands of jobs have been lost in the construction sector. I am deeply concerned that more than 80% of the Treasury’s infrastructure projects have not yet even started. Can the Minister explain to the House why there has been such a delay and what he will do to kick-start the process?

[Sajid Javid]

It is interesting that the hon. Lady did not mention the Armitt review, which was set up by the shadow Chancellor. Perhaps it is because Mr Armitt concluded that there was an economic crisis when this Government took office and she does not want to draw attention to it. However, she will be reassured to know that the Government take infrastructure investment very seriously. It is a top priority, which is why public investment under this Government is higher in each year of this Parliament than under the previous Government’s plans, as well as being higher as a percentage of national income.

[Harriett Baldwin (West Worcestershire) (Con)]

A crucial part of our national infrastructure is broadband for the 21st century. Will the Minister join me in congratulating Worcestershire county council on its excellent plans to put 90% of homes and businesses on superfast broadband?

[Sajid Javid]

My hon. Friend is right to draw attention to what is a hugely important plan for the residents of Worcestershire, which includes my constituents in Bromsgrove. We are right to make that investment, because it will make a real difference.

[Lindsay Roy (Glenrothes) (Lab)]

18. What estimate he has made of the annual value of the reduction in the additional rate of income tax to 45% to a person earning £1 million per annum.

[The Exchequer Secretary to the Treasury (Mr David Gauke)]

The cost of reducing the additional rate of income tax to 45% is set out in table 2.2 of Budget 2013. We have not broken down the impacts on individuals by income ranges because of the significant behavioural response associated with the additional rate of income tax. The behavioural response is estimated in aggregate and reflected in the costing.

[Lindsay Roy]

Yesterday, yet another food bank opened, in Methil in my constituency. Fifty volunteers are doing an exceptional job in difficult circumstances. One of the volunteers asked me, “Why has the Chancellor prioritised tax cuts for the very rich, instead of using the revenue to alleviate family poverty in our society, and in Methil in particular?”

[Mr Gauke]

I would hope that the hon. Gentleman said in response that in the 2012 Budget we saw increases in stamp duty on high-value properties and a clampdown on tax allowances and reliefs for the wealthiest, all of which raised far more from the wealthiest than the 50p rate, which was failing to raise revenue.

[John Robertson (Glasgow North West) (Lab)]

T1. If he will make a statement on his departmental responsibilities.

[The Chancellor of the Exchequer (Mr George Osborne)]

The core purpose of the Treasury is to ensure the stability and prosperity of the economy.

[John Robertson]

I thank the right hon. Gentleman for that extensive answer. He was boasting yesterday that he had saved the country, while we have people struggling with electricity bills, transport costs and food prices are up, people on the same wages are getting less and less for their money, and zero-hours jobs mean that people cannot get a mortgage or a loan, unless it is a payday loan. What would the Chancellor say to those people?

[Mr Osborne]

I could give a more extensive answer and point out that, in Glasgow North West, which the hon. Gentleman represents in this Parliament, the claimant count is down this year and employment is up. In other words, we are turning the corner and putting right what went so disastrously wrong under the previous Government.

We have now had 50 minutes of this Treasury Question Time, and we are hunting for a Labour economic policy. We have not heard one advocated yet; maybe we will get one soon.

[Paul Maynard (Blackpool North and Cleveleys) (Con)]

T2. Many of my constituents have been adversely affected by the troubles at Equitable Life. May I please ask the Chancellor, on their behalf, for an update on the Government’s position?

[Mr Osborne]

I said in the Budget that we would make special ex gratia payments to Equitable Life policy holders who had bought their with-profits annuity before 1992. I said that we would try to make those payments as soon as possible, and I am pleased to be able to tell the House and the constituents of my hon. Friend, who represents them so well, that we can make those payments in this financial year, rather than in the next one as we originally predicted. We will shortly be writing to those annuitants with more information, but I can confirm that they will receive the money directly, without having to make an application. We are doing this not because we are legally obliged to do it but because, quite simply, it is the right thing to do.

[Ed Balls (Morley and Outwood) (Lab/Co-op)]

On growth, on living standards, on the deficit, on every test that the Chancellor set himself, his economic plan has failed. Since 2010, growth has been not 6.9% but 1.8%, families have been worse off not better off, and the deficit has not gone down to £60 billion but is stuck at £120 billion. How on earth can the Chancellor now claim that his economic plan has worked? After three wasted and damaging years, does he not realise that he cannot just airbrush out his failure?

[Mr Osborne]

The shadow Chancellor cannot airbrush out his predictions. He said:

“Britain’s double-dip recession is even deeper than first thought”,

but there was no double-dip recession. He also said that it was a “complete fantasy” that private sector job creation would replace losses in the public sector, but it has done so three times over. And three months ago, he said that our policy would choke off the recovery. The fact is that he cannot stand the fact that the economy is recovering and his plan would have been a disaster. Let us fear that the predictions about his own future in the shadow Cabinet turn out to be more accurate than his predictions about the British economy.

[Ed Balls]

Three years ago, this Chancellor did choke off the economic recovery. That is what happened, and his arrogant complacency will jar with millions of ordinary families who, even with growth returning at last, are still worse off because of his failing plan. Let me ask him who is benefiting from his policies. Can he confirm what the Office for National Statistics reported last month—namely, that the incomes of the highest earners were boosted in April because they delayed receiving their bonuses by a month in order to benefit from the tax cut for people earning more than £150,000 a year? The wealthy might be celebrating with the Chancellor, but everyone else thinks that he is completely out of touch.

[Mr Osborne]

I hope this is not our last encounter across the Dispatch Box, because we are enjoying this. We are enjoying the fact that the shadow Chancellor simply does not admit to the mistakes he made, not only in office but in opposition. He is increasingly like Monty Python’s black knight defending that bridge. When unemployment falls, he says that it is but a scratch; when business confidence rises, he says, “I’ve had worse”; the recovery—it is just a flesh wound. The limbs are falling off his economic argument, and it would be a comedy if it were not for the fact that Labour’s economic policies were a tragedy for this country.

[Stephen Mosley (City of Chester) (Con)]

T6. Next week, along with the university of Chester riverside innovation centre, I am organising a small business fair in Chester to try to encourage people to set up their own small businesses. Will my right hon. Friend the Chancellor tell us what the Government are doing to encourage people to set up their own businesses and create jobs in addition to the 1.3 million that have already been created in the private sector?

[Mr Osborne]

There is a record number of business start-ups in this country at the moment, and I congratulate the business community and people in Chester who want to set up their own business. We are doing everything we can to support them. The new employment allowance will help many hundreds of businesses in my hon. Friend’s constituency. Together, as Cheshire MPs, we can of course make a broader argument that Cheshire is a great place to invent.

[Kelvin Hopkins (Luton North) (Lab)]

T3. To sustain strong economic growth, to restore full employment and to support manufacturing for the long term, it is vital to establish an appropriate exchange rate. Does the Chancellor accept that case and, if so, what is he doing about it?

[Mr Osborne]

I make it a practice, like previous Chancellors, not to comment on the exchange rate, but let me make a broader point about monetary policy. At the Budget, I set a remit for the Bank of England to consider the use of forward guidance. Since we last met, the Monetary Policy Committee has, of course, made an independent judgment to take that up and has made a very clear statement about the future path of interest rates.

[Graham Evans (Weaver Vale) (Con)]

T7. Does my right hon. Friend the Chancellor agree that manufacturing surging to a three-year high and investment intentions rising to a six-year high show that this Government are committed to securing a balanced economy?

[Mr Osborne]

My hon. Friend, who is my constituency neighbour, knows as I do that manufacturing businesses are doing better now. Orders are up and exports, particularly to the new emerging markets, are up. In Daresbury in my hon. Friend’s constituency, we are committed to making sure that the manufacturing businesses at the cutting edge of technology get support, and we will continue to do that.

[Karl Turner (Kingston upon Hull East) (Lab)]

T4. I congratulate the Chancellor on his comedy haircut, but let me tell him that his policies are not very funny for people in my constituency, who are at least £1,500 a year worse off than they were in 2010. Does he accept that a certain few at the top are better off under his policies?

[Mr Osborne]

I have not heard in the 54 minutes of these questions either an apology for what happened under the Labour Government or a single economic policy being advanced. If the Labour party is against our welfare cuts or spending cuts, let it have the courage to get up and say that it would reverse them. We have not heard that at all in this questions session.

[Kwasi Kwarteng (Spelthorne) (Con)]

T8. My right hon. Friend is well aware that 80% of the employment in my constituency comes from the private sector. Will he tell us his plans for increasing private sector involvement in the economy and for giving that vital sector some support?

[Mr Osborne]

Of course one of the key things as the economy recovers is not to make the mistakes of the past and not to have the unbalanced economy that we had before the financial crash, when, for example, even in the boom years, private sector employment fell in some regions such as west midlands. What we must do in my hon. Friend’s constituency and elsewhere is support small businesses that are starting up, get the capital to the small businesses that want to expand and encourage the big companies to invest. In all those areas, there is positive news, but we have to stick at it.

[Chris Williamson (Derby North) (Lab)]

T5. Yesterday, the Chancellor said that those who opposed austerity had lost the argument, but wages are falling, child poverty is increasing and he is presiding over the slowest economic recovery in over 100 years. Unless the Chancellor is living in cloud cuckoo land or residing on planet Zog, he will surely admit that his record of economic competence has been less than satisfactory—

[Mr Speaker]

Order. I am sorry, but we have a lot to get through, so much shorter questions are required.

[Mr Osborne]

On planet earth, we inherited an economic mess, and we are putting it right. As I say, if Labour Members are serious about advocating an alternative economic plan, perhaps they would tell us today—perhaps someone will stand up and tell us—whether they oppose our spending cuts and would reverse them. We have not heard that today.

[Eric Ollerenshaw (Lancaster and Fleetwood) (Con)]

T9. Will my right hon. Friend continue his support for specific major infrastructure projects such as superfast broadband, rail electrification and High Speed 2, which should begin to address the divide between north and south that grew so much wider under the previous Government?

[Mr Osborne]

I strongly agree with what my fellow north-west MP has said. I think that investment in infrastructure is important, whether it is investment in superfast broadband for rural areas in Lancashire, investment in the northern rail hub—which, although it was campaigned for by parties on all sides in the north of England for years under the last Government, did not happen then, but is happening under this Government —or, indeed, investment in High Speed 2, which will help to change the economic geography of the country, and will ensure that all parts of it benefit from the economic recovery. I absolutely agree with my hon. Friend: those things need to go ahead.

[Chris Ruane (Vale of Clwyd) (Lab)]

T10. What assessment has the Chancellor made of the impact of zero-hours contracts on the health and well-being of British workers, and also on the consumer confidence of the hundreds of thousands of workers who are on such contracts?

[Mr Osborne]

The Department for Business, Innovation and Skills is investigating zero-hours contracts. It is seeking to establish whether there is abuse, and, if there is abuse, what we should do about it.

The Labour party seems to have suddenly discovered this issue. I do not remember a single Minister ever raising it when Labour were in government. Moreover, a number of Labour councils use zero-hours contracts.

[Sir Peter Tapsell (Louth and Horncastle) (Con)]

Although the economy is improving, I am afraid that the same cannot be said of the deputy Chancellor—[Interruption.]

[Ed Balls (Morley and Outwood) (Lab/Co-op)]

Shadow Chancellor.

[Sir Peter Tapsell]

Yes—you! [Laughter.]

Given that Sir John Vickers has just warned us that British banks are still seriously under-capitalised, does my right hon. Friend now accept that ring fencing, whether electrified or not, cannot be relied on to provide adequate protection for depositors and businesses in the event of another banking crisis? Will he therefore give further thought to the proposal, supported by Mr Paul Volcker and Lord Lawson, for the total separation of the commercial and investment banking sectors?

[Mr Speaker]

I will grant the right hon. Gentleman an Adjournment debate on the matter if he judges it to be necessary after he has heard the reply to his question. We shall see—but I am grateful to him.

[Mr Osborne]

Let me say first that the shadow Chancellor was in effect the deputy Chancellor for 13 years, when the economy became so unbalanced and we experienced the biggest crash in modern history.

My right hon. Friend raised a serious question about the separation of retail and investment banking and about, in effect, Glass–Steagall-like reforms or a Volcker rule in the United Kingdom. We asked John Vickers— whom he mentioned—to look into the issue, along with a serious commission of experienced people, and they concluded that ring-fencing retail banks was a better solution. That is what we are legislating for, and it shows that we are learning from the mistakes of what went so badly wrong when that deputy Chancellor was in charge of the City.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

As the Chancellor knows, a large number of small and medium-sized enterprises were let down by the conventional banking system. Many are finding that crowdfunding is a useful way of enabling them to start up and grow. Will he and the Secretary of State for Business, Innovation and Skills be very cautious before introducing unnecessary regulation to curb crowdfunding, which is a good thing for most small businesses?

[The Financial Secretary to the Treasury (Greg Clark)]

The hon. Gentleman is absolutely right. We want to see a great variety of sources of finance for small businesses. It is important for consumers and businesses to have confidence in those sources, and the Financial Conduct Authority is considering carefully rules that will strike precisely the balance to which the hon. Gentleman has referred.

[Mr Speaker]

Last but not least, I call Mr Richard Fuller.

[Richard Fuller (Bedford) (Con)]

Worse than the shadow Chancellor’s talking down of the British economy is the Labour party’s love of the jobs tax, which reduces employment, depresses wages and discourages enterprise. Will my right hon. Friend think about what he will do with the employment allowance next year, and see whether he can reduce it further so that we can reverse those trends?

[Mr Osborne]

I well remember my trip to Bedford with my hon. Friend before the 2010 election, when we were campaigning against the jobs tax which was the Labour Government’s solution to rising unemployment. This Government are adopting the opposite approach. We are taking taxes off jobs, and from next April there will be a new employment allowance that will help the many businesses in Bedford and throughout the country. That is just one example of what we are doing to fix what went so badly wrong.

Earthbeat Theatre

Tuesday 10th September 2013 Commons Chamber

Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)

- Hansard - - Excerpts

The petition states:

The Petition of residents of East Cleveland,

Declares that Redcar and Cleveland Borough Council should allow Earthbeat to convert Guisborough Registry Office into a community theatre for the people of Guisborough and East Cleveland.

The Petitioners therefore request that the House of Commons urges Redcar and Cleveland Borough Council to allow Guisborough Registry Office to be converted into a community theatre.

And the Petitioners remain, etc.

[P001219]

Tougher Legislation for Dangerous Dogs

Tuesday 10th September 2013 Commons Chamber

Graham Jones (Hyndburn) (Lab)

- Hansard - - Excerpts

The petition states:

The Petition of residents of Haslingden & Hyndburn,

Declares that seven children and two adults have been killed by dogs since 2006, and that 6,000 admissions to hospital are caused by dog attacks each year leaving many victims scarred for life; notes that the introduction of Dog Control Notices is supported by many organisations including the Kennel Club, the Dogs Trust, RSPCA, Royal College of Nursing, British Veterinary Association and the Communication Workers Union; and believes that the Government’s current proposals on dangerous dogs do not go far enough.

The Petitioners therefore request that the House of Commons urges the Government to amend the law to cover attacks on people and animals on both private and public property, to enforce Dog Control Orders, to introduce Dog Control Notices giving the authorities the power to intervene, to introduce the compulsory micro-chipping of all dogs and to promote responsible dog ownership, including training owners and dogs.

And the Petitioners remain, etc.

[P001220]

Accident and Emergency Departments

Tuesday 10th September 2013 Commons Chamber

12:34

[Andy Burnham (Leigh) (Lab)]

(Urgent Question): To ask the Secretary of State for Health if he will make a statement on his plans to alleviate pressure on accident and emergency departments.

[The Secretary of State for Health (Mr Jeremy Hunt)]

This morning I made a written ministerial statement outlining the Government’s plans for the winter and detailing how we are allocating £250 million of funding for NHS England. Working with Monitor and the NHS Trust Development Authority, NHS England will distribute this money in 2013-14 to the areas where it is needed most. This follows the announcement in August by my right hon. Friend the Prime Minister that A and E departments will be given an additional £500 million over the next two years to deal with seasonal pressures. Patients need to be able to rely on the NHS all year round, and especially when demand is at its greatest. Ensuring the NHS’s sustainability means identifying each of the challenges it faces and, where possible, alleviating the burden.

Flu is an avoidable pressure on the NHS. Every year, around 750,000 patients see their GP with flu symptoms and nearly 5,000 people die. While flu levels have been comparatively low in the last two years, it would be complacent to assume that they will not rise. Should this happen, it will increase pressure on A and Es, which have already seen a rise in admissions of 32% in the last decade.

The best way to protect oneself and other people from flu is to get the flu vaccine, so, for the first time, children aged two and three will be offered the innovative nasal spray vaccine. Young children’s close contact with others makes them more likely to transmit flu to vulnerable groups including infants and the elderly.

Around 27,000 people spend time in hospital with flu every year, so it is very important that NHS staff should do all they can to avoid getting, and passing on, flu. Less than half of front-line NHS staff get vaccinated against flu. In some hospitals, that drops to fewer than one in five. The Government want to boost significantly the number of health care workers getting the flu vaccine. Trusts will not be eligible to receive a portion of the money in future years if they do not achieve a staff vaccination rate of 75%, except in exceptional circumstances.

This funding will be targeted in the following way: £15 million will go towards securing a reliable NHS 111 service throughout the winter period; subject to completion of current scrutiny of plans, a total provisional amount of £221 million will go to the 53 highest-risk systems; and a small contingency of £14 million will be used for final settlements, for trusts to use in the winter. My written ministerial statement outlines the indicative amounts that have been allocated to specific trusts. The additional allocation will require an increase to the revenue budget for NHS England for 2013-14, as had been specified in the mandate, and the revision to the mandate will be laid before Parliament in due course.

I recognise, however, that we need more radical change to reduce pressures on A and E departments over the longer term. I am currently consulting on my plans to provide improved care for vulnerable older people, to keep them out of hospital through better, more proactive care in their community. This will include better joint-working between the health and care systems; personalised, proactive care overseen by a named, accountable GP; and the sharing of GP records across different organisations, including out-of-hours GP services and the ambulance service.

NHS staff are working harder than ever before, and the British public rely on the NHS just as much as they have always done, and on a year-round basis. The plans outlined in this announcement will improve patient safety levels and help to reduce avoidable pressure on the NHS in the winter months ahead.

[Andy Burnham]

This Secretary of State has been in office for one year—the worst year in A and E in a decade: close to 1 million people waiting more than four hours, and on his watch, the first summer A and E crisis in living memory. But with this Government it is always someone else’s fault: GPs, nurses, patients, the weather, immigration, bank holidays—nothing to do with him, Mr Speaker, he is just a member of the public, as he is fond of saying. Well, I have got news for him: he is the Secretary of State, and it is time he started acting like it. All year we have warned him about the growing A and E crisis. First, he ignored those warnings, leaving A and E ill-prepared on the brink of a dangerous winter, as the NHS Confederation has warned. Now, in panic, he briefs out half-baked plans, without coming to this House. This is too little, too late. It is not good enough that we have had to drag him here on an issue of huge importance to our constituents. With his spin about the GP contract, he neglects the real causes.

First, on staffing, we learn today of the shocking shortage of doctors covering A and Es overnight, and we heard at the weekend reports of A and Es up and down the land without enough staff. More than 5,000 nursing jobs have been lost on the Government’s watch—and counting. Enough is enough. When will the Secretary of State stop the job cuts and ensure that all A and Es have enough staff to provide safe care?

Secondly, on GP opening hours, the Secretary of State tries to blame the 2004 contract but conveniently ignores the fact that A and E performance improved between 2004 and 2010. The truth is that it is the Government who have let GP practices stop evening and weekend surgeries, and it is the Government who ended the guarantee of appointments within 48 hours. What is he doing to restore patient access to GPs?

Thirdly, on social care, in the first two years of this Government there was an appalling 66% increase in the number of people aged over 90 coming into A and E via a blue-light ambulance—that is more than 100,000 very frail and frightened people in the backs of ambulances speeding through our cities and towns. That is a scandal, and it is more to do with social care cuts than anything else. I do not know how many more times I am going to have to ask the Secretary of State this: when will he do something to stop the collapse of social care in England?

All the while the Secretary of State blames a contract signed 10 years ago for today’s pressure he neglects the real causes of his A and E crisis. That is dangerous and it cannot carry on. Patients and staff cannot go through another year in A and E like the one we have just had. He should cut the spin, get a grip or go.

[Mr Hunt]

In the right hon. Gentleman’s endless quest to turn the NHS into a political football, he, disappointingly, paints a picture that is a long way from reality. He talks about A and E performance. Yes, since I have been Health Secretary we have missed our target in one quarter, but when he was Health Secretary he missed it in two of the three quarters, including 14 weeks over the crucial winter period. What he does not tell the House is that this Government actually hit their A and E target for the year as a whole, whereas in Labour-controlled Wales the NHS budget has been cut and the A and E target has not been hit since 2009—he repeatedly refuses to confront that.

The right hon. Gentleman talks about the number of nurses being down. He might want to check the figures and correct the record for the House when he uses the 5,000 figure, because the fact is that the number of hospital nurses—hospitals are where A and E departments are—has gone up under this Government, as has the number of doctors, health visitors and midwives. None of that would be possible if we had cut the NHS budget by £600 million from its current levels, which is his policy.

The right hon. Gentleman then talks about the social care budget. Under his Government the number of over-80s went up by more than a quarter, yet the Labour Government cut social care funding per head. We have introduced the innovative £3.8 billion merged health and social care fund, which will transform the joined-up nature of the services that people receive.

Finally, I am afraid that Labour Members are burying their heads in the sand about the enormous damage they did when they removed named GPs for members of the public under the GP contract. Professor Keith Willett, one of the most senior doctors in the NHS and responsible for all A and E services in NHS England, has said that between 15% and 30% of the people using A and E could be using primary care instead. That is why we are announcing really important changes to the way in which the GP contract operates, in order to address this problem. When the Government come before the House with a sensible package of short-term and long-term measures, any responsible Opposition would welcome it—instead, we have had political posturing and no attempt to address the real challenges facing the NHS.

[Mr Stephen Dorrell (Charnwood) (Con)]

May I welcome the £250 million that my right hon. Friend has announced as short-term relief of the pressures in A and E departments this winter, and in particular the £10 million he has announced for Leicester’s hospitals trust? Does he agree that the way to relieve pressure in A and E departments is by recognising that the health and care system is a single system that needs to be joined up and that the announcement by the Chancellor of £3.8 billion made available from health service spending to promote better integration of health and social care is the most effective single thing we can do to relieve pressure on A and E departments?

[Mr Hunt]

As so often on these matters, my right hon. Friend speaks extremely wisely. Since April, we have been working hard to deal with the underlying pressures on A and E departments while ensuring that we have cash available for short-term measures while those longer-term measures are put in place. He is absolutely right that joined-up integrated services are critical for A and E departments, because one of the biggest problems that they mention is the difficulty in discharging people from hospital, which makes it hard for them to admit patients who need to be admitted, often in very distressed circumstances. We also need to address the longer-term IT problems that mean that A and E departments cannot access people’s medical records and the question of alternatives to A and E, particularly in the community and through enhanced GP services.

[Mr Ben Bradshaw (Exeter) (Lab)]

If the Secretary of State is serious about people not attending A and E unnecessarily, why did he cut Labour’s extended GP opening hours and why is he allowing NHS walk-in centres to close up and down the country?

[Mr Hunt]

The fact is that one thing we need to do is to address why people go to A and E instead of the alternatives, such as walk-in centres. Communication about the alternatives to A and E is not as good as it needs to be. We are addressing those issues, but I must say to the right hon. Gentleman that the previous Government failed to address this problem when he was Health Minister and the difficult issue of the reconfiguration of services was never fully grasped. We are grasping it and that is why Professor Sir Bruce Keogh is undertaking his review right now.

[Dr Sarah Wollaston (Totnes) (Con)]

I congratulate the Secretary of State on his welcome stand on continuity of care and the role that that plays in reducing A and E admissions. Could he go further in stating how he will ensure that we have more doctors trained from medical school in both A and E and general practice?

[Mr Hunt]

My hon. Friend is right and staff recruitment is critical. We have already said that we want another 2,000 GPs and are considering whether that is enough. We recognise the fact that general practice is very stretched, that we need GPs to offer more services and that we need more people to do that. Professor Keogh’s review is considering A and E departments, and one thing we are asking is why we are one of the only countries in Europe to have an emergency medicine specialty. Other countries do not do that and ask all doctors to spend time in A and E. We are also considering what we need to do to make A and E a more attractive profession for people to go into, given the antisocial hours that come with the territory. That is not an easy problem to solve, but we recognise that it is incredibly important that we crack it.

[Grahame M. Morris (Easington) (Lab)]

Has the Health Secretary had a chance to pause and reflect on the Government’s decision not to publish the risk register? If so, did the register warn that the reorganisation might have had an adverse effect on A and E performance?

[Mr Hunt]

As I recall, the risk register for that period found its way into the public domain. As for our publishing the risk register, we are following exactly the same policies as the hon. Gentleman’s Government followed in office. They refused to publish that register for the simple reason that officials need to be able to give Ministers frank advice in private if Ministers are to do their job properly. That is why we have not changed the policy.

[Mr Christopher Chope (Christchurch) (Con)]

The Royal Bournemouth hospital accident and emergency department treats 70,000 patients a year. Will my right hon. Friend explain how it can possibly be in the interests of those patients for that department to be downgraded to a minor injuries unit?

[Mr Hunt]

The changes that my hon. Friend alludes to are locally driven and have not crossed my desk. I want to reassure him that if they do cross my desk, I would not approve them unless there was convincing evidence that that was in the interests of patients and there had been proper consultation.

[Dame Joan Ruddock (Lewisham, Deptford) (Lab)]

Having been defeated in the High Court by the Save Lewisham Hospital campaign, the Secretary of State has decided to appeal that decision. Given the crisis in A and E in London, has he any new ideas as to how A and E services should be provided in Lewisham, and if so, will he share them with the local MPs?

[Mr Hunt]

We are determined to do what is right for the people of Lewisham and of south London. Let me be clear: the problems of South London Healthcare NHS Trust were not addressed by the right hon. Lady’s Government when they were in office. We are addressing them, and sometimes those decisions are difficult, and sometimes they are not popular with local people. I took the decision that I did because it will save about 100 lives a year. I think it was the right decision, and I want to ensure that I do the right thing by her constituents.

[Sir Tony Baldry (Banbury) (Con)]

The extra £10 million for the Oxford University Hospitals NHS Trust to deal with winter pressures is very welcome. Sir Jonathan Michael and his team have already made it very clear that they will open a significant number of new beds this winter and take on a significant number of new members of staff. The Oxfordshire clinical commissioning group is already working hard on enhancing primary triage, so that fewer people have to go to A and E. Would it not be better if we just let NHS managers—the NHS—get on with this, rather than the Opposition continuously shroud-waving every winter, in the hope there might be some failing that could shore up their flagging opinion polls?

[Mr Hunt]

We have not heard any kind of policy from the Opposition today, or any suggestion as to what they would do differently. We have presented to the House a package of short-term and long-term measures, designed to address the immediate and the underlying challenges. It is a very comprehensive package, but it is going to be a very tough winter and I would urge all responsible politicians from all parties to row in behind the package, which I think will make a very big difference on the front line.

[Mr Kevin Barron (Rother Valley) (Lab)]

If the 2004 GP contract was to blame for the current crisis in A and E, could the Secretary of State explain why, in 2009-10, over 98% of patients were seen within four hours?

[Mr Hunt]

That contract set in train a process whereby it became easier and easier to access an A and E department, and harder and harder to access a local GP. Since that period we have had, I think, 3 million more people going to A and E every year than was the case at the time of that contract change. That is one of the underlying problems. It will take time, but we shall put that problem right.

[Sir Bob Russell (Colchester) (LD)]

I recently spent the whole evening on the night shift of the A and E at Colchester general hospital, and I do not recognise what we have heard from the Labour Front Bench today. As the Secretary of State is keen on alternatives to A and E, may I urge him to work with the Secretary of State for Education and implement first aid training as part of the school curriculum? Within a generation, we would have 1 million qualified first-aiders. That is one way of reducing unnecessary visits to A and E.

[Mr Hunt]

My hon. Friend has campaigned regularly on this subject and there is a lot of merit in what he says. We do need more young people to know the basics of first aid, and that can be extremely important—even life-saving. But we also need to ensure that the NHS is there when we need it, 24/7, and that is why we need to make some important changes to the way in which A and E departments operate, in both the short term and the long term.

[Jim Shannon (Strangford) (DUP)]

Twenty-four thousand elderly people died last winter due to cold-related illnesses, and many of them had been referred to A and E departments. What specific assurances will the Minister make to vulnerable elderly people, who really dread the onset of winter?

[Mr Hunt]

That is what today’s announcement is all about. We are trying to reassure them that we are leaving no stone unturned, and where there are things that we can do in the short term, we are doing those things because we want every older person to feel confident that their NHS will be there for them—that their local A and E department will be able to cope with the additional pressures that develop every winter. But I would also say to them that where there are alternatives to A and E departments, people should consider those as well. That is why some of the measures that we are investing in are good alternatives to A and E, which can often give more appropriate treatment.

[Mark Reckless (Rochester and Strood) (Con)]

Hospital staff have acted with extraordinary enthusiasm to, as they put it, reboot Medway following the Keogh review. Can the Secretary of State confirm that the £6 million or so extra that he may provide to help our A and E should be in addition to anything that the clinical commissioning group might otherwise have agreed to provide?

[Mr Hunt]

Yes, I am happy to confirm that it is additional money. I thank my hon. Friend for the interest that he shows in his local hospital, which is going through a very challenging time. We are absolutely determined that where hospitals are failing or delivering inadequate care, we will not sit on those problems; we will expose them and deal with them. That is the best thing we can do for my hon. Friend’s constituents and people all over the country where there are, unfortunately, problems with local hospitals.

[Mr John Denham (Southampton, Itchen) (Lab)]

In the last year, the A and E target was missed at Southampton hospital in 38 of 52 weeks. Since I last raised that in the House, Monitor has gone in to investigate the governance of the hospital, yet no money has been made available by the Secretary of State in today’s announcement. Is that not a sign that the crisis is so big that he has only been able to give a limited amount of help to those places that have an even worse crisis than we have in Southampton?

[Mr Hunt]

The pressure exists throughout the NHS. The right hon. Gentleman is absolutely right: there is real pressure in all hospitals. I commend all A and E departments for their hard work. The ones that got additional resources today were the 53 local health economies where we thought the risks were highest, and I think it was right to target that money to help those areas, but that is not to say that there is not a lot of pressure in other areas. That is why the long-term changes that we are talking about—the transformation in IT systems, the increased availability of GPs to look after frail and vulnerable older people, the integration of health and social care services—will benefit the right hon. Gentleman’s constituents and his hospital profoundly, and I am sure he will notice the difference.

[Angie Bray (Ealing Central and Acton) (Con)]

I welcome the extra money for Ealing Hospital NHS Trust and North West London Hospitals NHS Trust. It will come in very useful indeed. However, my right hon. Friend will be aware that four hospitals in North West London are still under threat of losing their A and Es. The independent review into that decision is due to report to his Department very shortly. When are we likely to get a final decision from him?

[Mr Hunt]

Let me reassure my hon. Friend. First, I thank her for her assiduous campaigning for her local hospital, which is recognised on both sides of the House. I am expecting that report on Friday, and as the House knows, when it comes to issues of hospital reconfigurations, I want to make decisions as quickly as I can. I will want to consider it very carefully, but I think everyone would like the certainty of knowing what will happen, so I will report to the House as soon as I am able to make a decision.

[Bridget Phillipson (Houghton and Sunderland South) (Lab)]

Hospitals across the north-east, as in many parts of the country, are facing considerable pressure on their A and E departments. Will the Secretary of State set out in more detail the rationale used to allocate the funding? I notice that not a single NHS trust in the north-east appears on his list.

[Mr Hunt]

The decision on which 53 areas to concentrate the resources was not made by me; it was made by NHS England, talking to Monitor and the NHS Trust Development Authority, on the basis of where, in their professional assessment, the highest-risk areas are. That is a sign that hospitals in the north-east are performing extremely well. In the past few months I have visited Newcastle, and I thought the hospital was absolutely fantastic; I did a stint on the front line there. There are some outstanding hospitals across the country, and there is very good NHS provision in the north-east. That is probably the reason.

[Andrew George (St Ives) (LD)]

I wish my right hon. Friend well in his quest to reintegrate a fragmented service —a trend which was largely started under the previous Government—but given the fact that the ambulance service provides a very good bolster, and indeed support, and helps to remove pressure from many A and E departments, how much of the £500 million will be made available to support ambulance services in their support of A and E departments?

[Mr Hunt]

Quite a lot of the money will help ambulance services indirectly because it will be intended to reduce the number of blue light calls by, for example, providing primary care alternatives to A and E by better integrating health and social care economies, but the long-term change that we announced last week, which I think will make a real difference to ambulance trusts, involves IT. In this day and age it is crazy that an ambulance can answer a 999 call and go to someone’s home not knowing that they are a diabetic who has mild dementia and who had some falls last year. That information could be incredibly helpful to paramedics and we want to make sure that, with patients’ consent, they have it at their fingertips.

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

The A and E at the Wolverhampton New Cross hospital is already under great pressure and earlier this year had its busiest day in history, but what really concerns local people are the possible implications of the closure of the A and E at Mid Staffs and the transfer of the work to New Cross. Can the Secretary of State confirm that if that goes ahead, New Cross hospital will have the resources in terms of capital and staff to make it work, because the alternative will be a second-class service for patients in both Wolverhampton and Staffordshire?

[Mr Hunt]

I thank the right hon. Gentleman for the interest and support that he shows for his local hospital. Of course, Mid Staffs has an extremely troubled history and it would be a derogation of my duties if I did not try to sort out the problems there once and for all, but we will not make any changes that have knock-on effects on neighbouring trusts without proper assessment and making sure that provisions are in place so that they can cope with any additional pressures. The final decision about what is going to be done has not been made, but I reassure the right hon. Gentleman on that point.

[Steve Baker (Wycombe) (Con)]

The A and E crisis in Wycombe results from the closure of the department under the previous Government. Although I would love to lay the blame squarely on Labour, is not the truth that, over the life of the NHS, clinical practice and management have changed substantially? Will my right hon. Friend consider producing a White Paper that takes a holistic view of emergency and out-of-hours care so that we can have an A and E service that is fit for the 21st century?

[Mr Hunt]

My hon. Friend has campaigned as hard as anyone in the House for more personalised and humane care for his constituents, and he is right. We need a radical rethink about the way that A and E departments work. My only hesitation in leaping to accept his suggestion of a White Paper is that that process takes a very long time. Professor Sir Bruce Keogh is in the middle of a review and I want him to be able to report back. I hope that we can get support across the House for what he says so that we can implement his solutions much sooner than that White Paper process would allow.

[Heidi Alexander (Lewisham East) (Lab)]

The Secretary of State may be holding on to some sort of misplaced belief that he did the right thing with regard to Lewisham. However, the High Court judgment in the summer ruled and found him to have acted unlawfully in taking the decision to slash services at Lewisham in order to solve financial problems elsewhere. Rather than wasting more taxpayers’ money in appealing against this judgment further, why will he not allow local health care professionals to determine the future shape of acute services in south-east London to meet the needs of the community and not just the needs of NHS accountants?

[Mr Hunt]

I know that the hon. Lady has campaigned assiduously and determinedly for her constituents. Even though we have different views, I hope she will understand that at every stage I have taken the decisions, often difficult decisions politically, that I think will best serve her constituents and the people of Lewisham. I accepted the advice of the medical director of the NHS that that decision on Lewisham would save a significant number of lives. That is why I took that decision. As to what we do going forward, I will continue to do what I think is the right thing for her constituents. If she does not agree with the decisions I make, I hope she will at least show greater respect for the motives behind them.

[Gavin Barwell (Croydon Central) (Con)]

I have discussed with my right hon. Friend on many occasions the issues facing Croydon University hospital. I am very grateful for the £4.5 million that has been announced today. May I ask him both to look kindly on the bid for capital investment for the A and E department there, and to pay tribute to the doctors and nurses in my A and E department and others across the country who are working so hard under such pressure?

[Mr Hunt]

I thank my hon. Friend for making that point. It cannot be said enough how hard A and E staff in particular work—antisocial hours in very challenging conditions. Many hon. Members will have seen that in their local hospitals. With respect to the capital allocations, I hope that the House has a sense from today that we are looking to solve the long-term problems facing A and E departments, as well as giving immediate help for this winter and next winter, so of course we will look carefully at the business case put forward by his local hospital for capital.

[Valerie Vaz (Walsall South) (Lab)]

The Royal College of Physicians, the College of Emergency Medicine and others have already come up with a 10-point plan for what to do about emergency care. That is the professional view. When will the Secretary of State act on it?

[Mr Hunt]

The royal colleges have come up with a number of important and good ideas. I hope that the hon. Lady has seen from my announcement today that we are making some profound changes to address the underlying problems in A and E which incorporate much of their thinking, but there are other ideas. We will continue to engage closely with the royal colleges because they can give us a lot of help in ensuring that we get the right answer.

[Mr Peter Bone (Wellingborough) (Con)]

Wellingborough’s nearest A and E is Kettering general hospital, which is 30 minutes or more for most of my constituents to get to. However, the proposal for an urgent care centre at the Isebrook hospital in Wellingborough will allow 40% of those constituents to go locally and relieve pressure on Kettering. Is this the sort of thing that the Secretary of State wants to encourage?

[Mr Hunt]

I always try to support the ideas that come up from different parts of the NHS because people on the ground usually have the best ideas about what needs to be done, but when decisions cross my desk it is important that I consider the knock-on effect on other areas, and I get independent advice on that as well. I shall follow closely the proposal that my hon. Friend mentions.

[Nic Dakin (Scunthorpe) (Lab)]

Does the Secretary of State believe that he has done enough to avoid a crisis in A and E this winter?

[Mr Hunt]

I think we have done everything we can, and we have tried to listen hard to the suggestions for what can help in the short term and what can address the underlying problems. I believe it is possible for the NHS to meet its targets this winter, but I do not want to say that it is going to be easy. It will be a very tough winter and we need to get behind the doctors and nurses on the front line who are doing their very best to deliver a great service to the public.

[Nigel Mills (Amber Valley) (Con)]

I welcome the extra £4.5 million for the Derby hospitals trust. On a separate matter, can the Secretary of State reassure my constituents that if they ring 111 they will now get a quality service that gives them the advice they need?

[Mr Hunt]

I thank my hon. Friend for mentioning the support that we are giving to Derby, which I hope will be a great help over this winter and next winter. Improving 111 is an important part of the long-term solution for A and E. If there is one thing that could persuade people not to go to their local A and E, it is to pick up the phone and get a good service. We have 92% satisfaction rates with 111 now, after the teething problems earlier in the year, but I think it can be even better. One of the things that would make the biggest difference is if we did something that has never happened before, which is to make it possible for doctors at the end of the 111 lines to access people’s medical records, with their consent. Then people would be talking to someone who knew about them, their allergies and their medical history. That is a big change. It never happened under the previous Government. Their attempts—[Interruption.] NHS Direct had no access to people’s medical records, which is what we are talking about. That would be a profound change and could make a big difference.

[Barbara Keeley (Worsley and Eccles South) (Lab)]

It appears that the Secretary of State is not listening to the Health Committee, which has looked into the issue. The Chair, the right hon. Member for Charnwood (Mr Dorrell), has made it clear that he does not think the 2004 GP contract is to blame for these issues, but we found out that only 16% of hospital trusts have the recommended level of emergency consultants, and we noted that nearly £2 billion has been taken out of adult social care. When will the Secretary of State deal with the staffing cuts and budget issues that are actually causing the A and E crisis?

[Mr Hunt]

My right hon. Friend said to the House that he largely agreed with the changes that I wanted to make to the GP contract. I always listen very carefully to what the Select Committee says, but I point out to the hon. Lady what Professor Keith Willett, who is the person at NHS England who is in charge of all A and E departments, said. He said that between 15% and 30% of the people attending A and E departments could be looked after by primary care. If we ignore that—I am afraid that what Labour did in 2004 has made the problem a great deal worse—we will not solve the underlying problems with A and E.

[Iain Stewart (Milton Keynes South) (Con)]

I warmly welcome the additional £2.7 million for Milton Keynes hospital, which will help address short-term pressures this winter, but, looking at the longer term, I urge my right hon. Friend to look again at the case that I and my hon. Friend the Member for Milton Keynes North (Mark Lancaster) and the Milton Keynes Citizen have been making for an expanded A and E centre in Milton Keynes to meet the needs of a vastly increasing population.

[Mr Hunt]

I congratulate my hon. Friend and his Milton Keynes colleague on their assiduous and regular conversations with me on the pressures on their A and E. I recognise that it is operating way above its original planned capacity and hope that today’s announcement will make some difference, but we will continue to look at long-term solutions because we recognise that there are long-term pressures.

[Mr Andy Slaughter (Hammersmith) (Lab)]

In view of the continuing and worsening crisis in A and E, will the Secretary of State concede that closing four out of nine A and E departments and 500 beds at Charing Cross hospital is now unsustainable? Will he abandon those plans, or at least suspend them until the crisis is over?

[Mr Hunt]

I take issue with the hon. Gentleman’s suggestion that this is a worsening crisis in A and E. We have hit our A and E target for the last 22 weeks. We recognise that there are real pressures and are seeking to address them. On the proposals for north-west London, he knows that I cannot comment until I have received the Independent Reconfiguration Panel’s advice. I will look at it very carefully, but obviously, considering the pressures on A and E departments across the country, I will want to ensure that any proposed solution makes sure that his constituents get the service they need when it comes to urgent and emergency care.

[Julian Smith (Skipton and Ripon) (Con)]

I welcome the £1.5 million for Airedale hospital in Yorkshire and urge the Secretary of State to keep a watchful eye on those hospitals serving some of the most rural parts of our country, such as the Yorkshire dales, which I represent.

[Mr Hunt]

Absolutely. I have visited Airedale hospital, which I think is excellent. It is one of the few hospitals in the country where the A and E department has access to GP records, which means it can give patients a much better service. It also has fantastically innovative ways of looking after the frail elderly in the community. I think that some of the smaller rural hospitals are blazing a trail when it comes to the changes we need to make elsewhere.

[Andy Sawford (Corby) (Lab/Co-op)]

Kettering general hospital’s A and E department was built for 20,000 people a year but is now trying to meet the needs of 80,000 people. The money announced today is of course welcome, but I ask the Secretary of State to look seriously at our bid—a joint bid from neighbouring MPs too—for capital investment in Kettering’s A and E.

[Mr Hunt]

I will of course look at that closely. I have been to Kettering hospital and recognise that it is very busy and that people there are working very hard, but I think that the staff are doing a fantastic job.

[Andrew Bridgen (North West Leicestershire) (Con)]

Will my right hon. Friend pledge to do everything in his power to undo the mess created by Labour’s 2004 GP contract give-away in order to help restore the essential link between patients and family doctors, which will lead to better patient outcomes and reduce pressure on our A and E departments?

[Mr Hunt]

My hon. Friend is absolutely right. I am astonished that the Labour party seeks to defend those changes to the GP contract, which got rid of named GPs, removed responsibility for out-of-hours services from them and broke the personal responsibility that the best GPs always wanted to feel for the people on their list. In fact, many brave practices refused to go along with those contract changes and continue to have named GPs. There is clear evidence that people who have named GPs use hospital services less. If we are going to give older people the right care, we need to undo those damaging changes.

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

The Secretary of State has spoken confidently about how his changes will make a difference in the short term, but over the weekend the BBC revealed that A and E departments are, on average, 10% understaffed and that one trust in London is 75 nurses down. Despite what he has announced today, how can he be sure that those vacancies can be filled?

[Mr Hunt]

The hon. Lady is right that there are staff shortages, and it is not because trusts do not want to employ people; it is because it is difficult to find people to fill all those vacancies. Those are some of the longer-term problems that we will have to address when looking at how to make working in A and E more attractive. There are a number of things we can do in the short term to alleviate the pressure, such as putting GPs on the front desks at A and E departments so that people can get help, ensuring that the social care system is open seven days a week so that people can be discharged on Saturdays and Sundays, and extending consultant cover late into the evenings and at weekends, when A and E departments are busiest. I think that it is right that we do those things straight away while trying to address the longer-term problems.

[Glyn Davies (Montgomeryshire) (Con)]

My constituents depend on A and E services in Shropshire, which in many cases are already a long way distant. Does my right hon. Friend agree that when reorganisation takes place, which will happen in Shropshire, proper account should be taken of the distances that people living in rural areas will have to travel for emergency and urgent services?

[Mr Hunt]

I absolutely agree. It is really important that we recognise those challenges in rural areas, and indeed semi-rural areas such as my constituency, where we have had similar issues. I can assure my hon. Friend that when we make structural changes, we take those issues closely into account.

[Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)]

How many walk-in centres have been closed since May 2010?

[Mr Hunt]

I do not have the figure at my fingertips, but I will happily write to the hon. Gentleman.

[Andrew Selous (South West Bedfordshire) (Con)]

I would like to praise very highly the A and E staff at Luton and Dunstable hospital, whose work I have seen at close quarters on a number of recent occasions. If A and E staff had access to GP records, would there not be better diagnosis and would not time be saved? If some of our smaller hospitals are doing that, it raises the question why all of them are not.

[Mr Hunt]

My hon. Friend is absolutely right. The truth is that many in the NHS had their fingers burnt when the previous Government, with the best of intentions, tried to address the problem, unfortunately with abysmal results and billions of pounds wasted. I do not think that we should let that failure stop us doing what we know can transform services. When we look at the changes that have been made in the banking, airline and retail industries, we see that we need to use the benefits of modern technology in the NHS. It will save thousands of lives.

[Steve McCabe (Birmingham, Selly Oak) (Lab)]

How could any Secretary of State imagine that it is okay to preside over a situation in which there are only five consultants working overnight in A and Es across the entire country?

[Mr Hunt]

I agree with the hon. Gentleman that consultant cover is not as good as it needs to be, and not just in A and E departments, but across NHS hospitals, so I hope that he will support me in moving forward with a seven-day NHS, which is a very big change and might be opposed by people working in the NHS. I am delighted that I can be assured of his support.

[Neil Carmichael (Stroud) (Con)]

Does the Secretary of State agree that putting patients first is at the heart of this and that that means, in part, ensuring that they can navigate the system and go to places such as the excellent Vale community hospital in Dursley where appropriate?

[Mr Hunt]

I am delighted to hear about the excellent Vale community hospital in Dursley. On my hon. Friend’s general point, we have not been good at persuading the public that there is anything between GP surgeries and A and E departments. The NHS has tried repeatedly to come up with walk-in centres and urgent care centres. Some have been successful, and some have not. At the heart of the challenge is the fact that the public want a 24/7 service for accidents and emergencies and urgent care. We have to ensure that they have it and that they understand where it is.

[Kate Green (Stretford and Urmston) (Lab)]

Last year, Central Manchester University Hospitals NHS Foundation Trust and University Hospital of South Manchester NHS Foundation Trust both missed their A and E waiting targets on 30 out of 35 weeks. This year, of course, they will be coping with the additional challenge of absorbing the fallout of the downgrading of the A and E at Trafford general hospital. I note that neither trust has been awarded additional funding today. Can the Secretary of State assure me that the risk model that NHS England applied has properly taken account of the consequences of having to absorb major organisational change and, if it turns out that there are more pressures on those A and E departments this winter, that provisional funding will be looked at again?

[Mr Hunt]

I can absolutely reassure the hon. Lady on that point. We are extremely careful—I have had good discussions with her about this—before making any structural changes, to ensure that the impact on neighbouring A and E departments is properly thought through. Since the statement to the House about Trafford hospital, we have approved a capital funding programme for one of the neighbouring hospitals that will be affected. That is extremely important and we will continue to monitor it closely.

[Henry Smith (Crawley) (Con)]

The A and E unit that my constituents have to access is at East Surrey hospital, and I welcome last year’s investment of £4 million to refurbish it, but does my right hon. Friend agree that Labour’s closure of Crawley A and E in 2005 certainly did not help with the pressure on local A and E departments?

[Mr Hunt]

A number of things have contributed to these changes, one of which is that we have not succeeded, as an NHS or as a Parliament, in getting the way in which we do reconfigurations right: they do not command the confidence of the public and people are not satisfied that there are alternatives that they can trust or that good alternatives will be put in place when a change is proposed. We need to learn the lessons from what happened in my hon. Friend’s constituency.

[Derek Twigg (Halton) (Lab)]

Since 2010 the new Whiston hospital has seen an increase of 25% in emergency demand, but it has not been funded for it. I met the chief executive and vice-chair of the governing board last Friday and asked them whether they would be able to guarantee a safe service if that level of activity continues with the winter pressures, and they said that they might not. Will the Secretary of State urgently look at the situation at Whiston and come up with some solutions?

[Mr Hunt]

I hope that when the hon. Gentleman looks at today’s announcement it will reassure him that we are addressing not just the immediate pressures in the most difficult areas, but the underlying pressures. That 25% increase at Whiston—I pay tribute to the staff in its A and E department, who will no doubt be working extremely hard to cope with it—has come about because we have not had better alternatives to A and E and because departments have often found it difficult to discharge people from hospital into the community, which has further increased the pressure on them. What we have announced in the past few months and today will make a real difference to alleviating those pressures.

[Robert Halfon (Harlow) (Con)]

My right hon. Friend will be aware that Princess Alexandra hospital in Harlow is an outstanding hospital with outstanding staff. My constituents will be incredibly grateful for the £5.7 million announced today, which comes on top of a £470,000 grant provided to St Clare hospice by the Minister of State, Department of Health, the hon. Member for North Norfolk (Norman Lamb), who has responsibility for care. Does my right hon. Friend agree that that shows that this Government invest in the NHS in Harlow, and will he come to Princess Alexandra hospital to see the excellent work that is being done?

[Mr Hunt]

I would be delighted to go to Princess Alexandra hospital, where I am sure the work is indeed excellent. I agree with my hon. Friend’s fundamental point, which is that this Government took the very difficult decision not just to protect the NHS budget, but to increase it. That was described as irresponsible by the right hon. Member for Leigh (Andy Burnham). We are spending £600 million more in real terms this year than we would have spent if we had followed his advice. That makes a very big difference to hospitals such as that in my hon. Friend’s constituency.

[Diana Johnson (Kingston upon Hull North) (Lab)]

Will the Secretary of State be clear: did the risk register warn the Government that their reorganisation would hit the A and E performance targets?

[Mr Hunt]

There has been exhaustive analysis of the problems in A and E departments and whenever I have visited such departments I have not heard a single person say that the reorganisation was the cause of them. What they talk about is the underlying problems, which we are addressing today.

[Mr Philip Hollobone (Kettering) (Con)]

Despite the best efforts of its hard-working staff, the A and E department at Kettering general hospital has been under huge pressure for some time. It has failed to meet its targets and the chief executive resigned recently as a result. Would my right hon. Friend be kind enough to confirm the amount of additional funding to the A and E department at Kettering, and what is his assessment of the analysis that up to a third of those who present themselves to A and E departments could receive better, quicker and more appropriate treatment elsewhere?

[Mr Hunt]

My hon. Friend has campaigned assiduously for Kettering hospital, including by inviting me there to see it for myself. I think that its staff are working extremely hard. I am pleased to confirm that today’s announcement means that an extra £3.9 million will be given to the hospital to help it meet those pressures over this winter. I think that the people working in A and E would be the first to say that where there are alternatives in the community, they should be used. The long-term change we need to make is to reverse what has happened over the past decade, which is that it has become easier and easier to go to an A and E department and harder and harder to get an appointment with a GP. That was the profoundly wrong change made by the previous Government and that is what we have to put right.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

The Secretary of State will be aware that the major reason given for the reconfiguration of services at Chase Farm hospital was the need to increase the number of consultants and specialist staff in accident and emergency, but we discovered over the weekend, as colleagues have indicated, that there is a massive shortage of specialist staff and consultants, particularly in outer London, where there are special pressures. The Secretary of State has indicated some of the short-term measures, but my constituents want reassurance that steps will be taken to bolster the number of A and E consultants and specialist staff to look after them.

[Mr Hunt]

The hon. Gentleman is right to say that that is one of the key issues in the underlying pressures on A and E departments. About a quarter of the money announced today will be used to increase the capacity of A and E departments, including increasing consultant cover. In the end, however, we need more trained consultants; we need more doctors who want to work in A and E departments. That is a longer-term challenge, but one of the ways in which we will make A and E more attractive is by convincing doctors that we have a long-term, sustainable strategy to make sure that it does not become an impossible job. That is what the measures on improving GP access, IT systems and the social care system aim to achieve.

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

The Secretary of State may be interested to know that in a parliamentary seminar earlier this year the College of Emergency Medicine said that walk-in centres provided temporary help with A and E attendances but that their closure has had no impact at all. More importantly, does my right hon. Friend agree that we should praise those hospital trusts that have not needed extra money and that that is a ringing endorsement of their leadership?

[Mr Hunt]

My hon. Friend speaks extremely wisely, as ever. She is right. The reason why the 100 or so hospitals that have not benefited today did not get money is that our assessment is that they have outstanding leadership and will be able to cope. That is not, however, to minimise the pressure they will be under or the fact that it will be extremely hard work. I pay tribute to them because, as good hospitals, they often have to deal with more people wanting to go through their doors than through those of other hospitals with less good reputations. We need to support everyone and my hon. Friend is right to say so.

[Chris Bryant (Rhondda) (Lab)]

One pressure that applies equally in Wales and in England is that on the recruitment of consultants for A and E. Last year, Welsh health boards advertised for 14 A and E consultants but managed to appoint only one, and that was after a nine-month interregnum. May I urge the Secretary of State—this has been impressed on me many times by those who work in the NHS—to speak to the Minister for Immigration, because many trusts and hospitals are saying that the new operation of the immigration rules makes it impossible to recruit from overseas, even from countries that deliberately train for the international market?

[Mr Hunt]

We have designed the immigration rules so that they are flexible enough to make sure that NHS hospitals can recruit trained staff where they are needed and where we cannot find people with those skills in the UK. I say to the hon. Gentleman that although some challenges may be the same in England and Wales, one challenge is very different in Wales, because Labour there decided to cut the budget by 8%, which has made life a great deal harder for NHS trusts.

[Mr Marcus Jones (Nuneaton) (Con)]

Since May 2010 an extra 300 clinical staff are working at the George Eliot Hospital NHS Trust, which is now recruiting more nurses and more A and E consultants in response to the Keogh review. Does that not show that under this Government more resources are being directed towards front-line patient care?

[Mr Hunt]

It absolutely does. There are nearly 4,000 more front-line staff under this Government than there were under the previous Government at the time of the last election. More importantly, where there are problems in hospitals—my hon. Friend’s hospital has had a number of problems—this Government are not sitting on them or seeking to cover them up. We are addressing them and I hope that by the time of the next election we will be able to demonstrate that we have turned around my hon. Friend’s hospital and a number of others and that finally these serious problems are being addressed.

[Mr Robert Buckland (South Swindon) (Con)]

Will my right hon. Friend join me in thanking A and E staff at the Great Western hospital for their hard and successful work? Will he assure me that, if hospitals such as the GWH and the Royal Berkshire just down the M4 corridor incur any additional needs this winter, there is contingency in the budget?

[Mr Hunt]

We do have a contingency built into these plans, but it is also important for trusts to plan in advance. One of the reasons why we announced this funding in August and why we have today announced where it will go is in order to enable people to make long-term plans. The lesson we have learned from previous years is that if we come up with these packages in the middle of winter it is too late for anything to happen. I totally join my hon. Friend in commending the hard work at Great Western hospital.

Point of Order

Tuesday 10th September 2013 Commons Chamber

13:30

[Mr David Winnick (Walsall North) (Lab)]

On a point of order, Mr Speaker. On 2 September at Defence questions, I asked the Defence Secretary about a UK firm granted a licence to sell chemicals to Syria in 2012. The licence was revoked because of tougher EU sanctions. In reply, the Defence Secretary admitted that the export licences had been granted for some industrial chemicals that could have been used in processes that might be involved in the production of poisonous gases in Syria, but stated that no such chemicals were exported because the licences were revoked.

Yesterday the right hon. Member for Tonbridge and Malling (Sir John Stanley), who chairs the Committees on Arms Export Controls, wrote to the Business Secretary saying that the Defence Secretary’s statement in answer to my question was in direct contradiction to what the Business Secretary had written previously to the Chairman of the Committee. That letter of 10 April this year said that although the order had been revoked because of tougher EU sanctions, that could not stop shipments of chemicals already sent to Syria.

I put it to you, Sir, that the Defence Secretary inadvertently did not give me accurate information and could inadvertently have misled the House. In those circumstances, I ask for your help so that the position can be rectified and the Defence Secretary may come to the House to explain it.

[Mr Speaker]

I am grateful to the hon. Gentleman for his point of order and for his characteristic courtesy in giving me advance notice of it. I feel sure that the point of order will be drawn to the attention of the Secretary of State. If the Secretary of State judges that in the circumstances a clarification or, indeed, a correction is required, bearing in mind that each and every one of us is responsible for his or her statements in this House, there are a number of ways in which that can be achieved. I suggest that at this stage, now that the point has been aired and will shortly be heard by the target audience of the Secretary of State, the hon. Gentleman exercises modest patience and awaits the development of events. Knowing him as well as I do—he is a superb parliamentarian of enormous experience—I feel sure that if he is dissatisfied we will not have heard the last of it. I hope that that is helpful to the hon. Gentleman and to the House.

Access to Mental Health Services

Tuesday 10th September 2013 Commons Chamber

Motion for leave to bring in a Bill (Standing Order No. 23)

13:33

[Mike Thornton (Eastleigh) (LD)]

I beg to move,

That leave be given to bring in a Bill to provide for establishing maximum waiting times and establishing standards for access to evidence-based psychological therapies for those with mental health problems; and for connected purposes.

This Bill is about ensuring that those with mental health issues get access to the treatment they need when they need it. I have always known that mental ill health is a fact of life, but the figures surprise me. One in three families—that is, parents and their children—includes someone who is mentally ill. In people under 65, mental illness accounts for nearly half of all ill health. The economic cost amounts to over £100 billion a year, but the human cost—the suffering—is intangible. Many mental health problems, if untreated, can shatter lives.

Despite the obvious scale of the problem, only in the past few years have mental health issues started to emerge from the shadows of our society. Mental health is often a problem that people feel they need to hide, cover up, or excuse—and for far too long, Governments and society have felt as though they needed to do the same. I therefore welcome recent significant and major advances in the provision of mental health services. One of those is the pioneering IAPT—improving access to psychological therapies—programme, designed significantly to increase the availability of National Institute for Health and Care Excellence-recommended psychological treatments for depression and anxiety disorders. This has been particularly successful and is now in its fifth year, having treated over 1 million people. In addition, the Government’s commitment to embed parity of esteem for mental health in their mental health strategy and in the NHS mandate marks a significant shift in national attitudes to mental health.

However, a major disparity continues to exist regarding access to mental and physical health services in the NHS, and that is what the Bill seeks to address. Astonishingly, it remains the case that people with mental health problems do not have the same rights to timely access to treatment as those with other types of ill health. Despite the fact that the NHS constitution embeds the right to access certain services commissioned by NHS bodies within maximum waiting times, this excludes anyone who is waiting for psychological therapy. That means that at present there is no statutory maximum waiting time for mental health treatment of this type. In contrast, according to the NHS constitution, patients with a physical complaint have the right to be seen within 18 weeks.

There is also a disparity in relation to accessing the right services. The constitution states that

“you have the right to drugs and treatments that have been recommended by NICE for use in the NHS.”

Yet while patients have a right to demand NICE-approved drug and medical treatments for mental health issues, psychological therapies fall under a separate category. That means that patients do not have a right to these treatments—the very treatments that often result in the best long-term outcomes.

What does the status quo mean for my constituents in Eastleigh and people elsewhere with mental health issues? If somebody goes to their doctor seeking support for a mental illness and they are referred for treatment, they could be waiting two weeks, two months or even two years for treatment that sometimes may not be suitable for their condition anyway. In fact, it is entirely possible that they may never receive any effective treatment at all. Put simply, it is appalling; it is a lottery.

Lack of treatment and long waiting times have a huge impact on people’s lives. People are being forced to live with debilitating mental health problems day in, day out. Relationships can break down and many people are forced to take time off from work or give up a job completely. Children with mental health problems, unable to seek appropriate treatment, miss out on months of vital schooling, disrupting not only their education and their social development but their whole future. Perhaps most importantly, early treatment prevents later mental health crises. Rates of detention under the Mental Health Act 1983 are increasing year on year. They currently stand at 42% of all admissions to hospital, suggesting that people are not able to access the early support and treatment that are so vital to prevent major crises later on. One sufferer testified to Mind:

“I had a complete breakdown, was unable to work and was hospitalised. If therapy had been available when I needed it, I believe I could have been helped to manage the illness and not reach the stage where everything fell apart.”

Providing better and more timely access to treatment is not only the right thing to do but makes sound economic sense. The Centre for Mental Health estimates that, as I said, the economic and social costs of mental health problems amount to over £100 billion a year. In comparison, the wider annual UK cost of obesity is £15 billion. Let us take one example, among many, of where savings could be made: depression. Extending NICE-recommended treatments to all those with depression could deliver £1 billion in economic benefits each year, with treatment costs vastly outweighed by higher Government revenues and reduced welfare payments, as well as wider social benefits.

Given the disparity in waiting times and patchy access to services, hon. Members may ask how many of the people diagnosed by their doctor with mental illnesses are languishing on waiting lists waiting to receive treatment. Believe it or not, the answer, quite simply, is that no one knows. Few reliable figures exist for how long people have to wait for psychological therapies, and this further compounds the problem. Indeed, my hon. Friend the Minister of State, Department of Health himself admitted, during the debate on mental health on 16 May this year, that it was

“a bit shocking that we do not know the figures across the country for the number of people waiting and how long they are waiting.”—[Official Report, 16 May 2013; Vol. 563, c. 818.]

Without a mandatory maximum waiting time there is, of course, no consequence for trusts that do not provide timely treatment.

To get a better picture of current provision, it is necessary to turn to anecdotal evidence and estimates from charities that have surveyed those waiting for help. In 2010, a report entitled “We need to talk” was published by a coalition of mental health charities. It found that one in five of those surveyed had been waiting more than a year to receive treatment, and that one in 10 had been waiting more than two years. That is wholly unacceptable. We need better data in order to gain a better understanding of access and outcomes. I therefore urge the Minister to ensure that there is appropriate investment in the welcome mental health intelligence network currently being developed.

Let me emphasise that NICE recommended that psychological therapies are proven to be effective, so there is no basis on which to contest their use. According to experts from the LSE, after undergoing psychological therapies:

“A half of all patients with anxiety conditions will recover, mostly permanently, after ten sessions of treatment on average. And a half of those with depression will recover, with a much diminished risk of relapse.”

Such therapy is literally a lifesaver—a point particularly important with today being World Suicide Prevention day. I am sure hon. Members will agree that when such effective treatments exist, it is a scandal that they are not consistently available, within a reasonable time, to sufferers of mental illness.

In conclusion, I recognise the immensely valuable work that my hon. Friend the Minister of State has done, and continues to do, to ensure we work towards parity in this area. He has long argued that we must have access standards in mental health, and I am aware that his Department is starting to look at those issues, specifically through the NHS mandate “Refresh” document, currently out for consultation. I also welcome increased investment for IAPT in the recent comprehensive spending review, which I am sure he fought hard to secure. The Bill would ensure that that momentum is not lost. Over the past 10 years, much has been achieved and we have made enormous strides. However, achieving parity for mental health is a monumental task, and although we have made tremendous progress, the job is far from finished.

If someone is ill, they are ill. Let us remove the artificial, anachronistic and absurd distinction between so-called mental and physical illnesses. I commend this Bill to the House.

Question put and agreed to.

Ordered,

That Mike Thornton, Stephen Gilbert, Simon Wright, Sir Andrew Stunell, Sir Bob Russell, Mrs Annette Brooke, Sarah Teather, Steve Brine, Dr Alan Whitehead, Ian Swales and Paul Burstow present the Bill.

Mike Thornton accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 29 November, and to be printed (Bill 106).

Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Bill

Tuesday 10th September 2013 Commons Chamber

[Relevant Documents: The Seventh Report from the Political and Constitutional Reform Committee, on the Government’s Lobbying Bill, HC 601, and the First Report from the Committee on Standards, on the Government’s Lobbying Bill, HC 638]

[2nd Allocated Day]

Further considered in Committee (Progress reported, 9 September)

[Mr Lindsay Hoyle in the Chair]

13:44

[Mr Graham Allen (Nottingham North) (Lab)]

On a point of order, Mr Hoyle. As a matter of process, more than 200 charities and voluntary organisations wrote to the Minister on their anxieties about this Bill. Is it within your power to ensure that those anxieties, and many others that will be expressed in the debates on the various clauses that come before us today, are debated by the Committee? If colleagues from any part of the Committee were to filibuster so that those points were not reached, it would be an act of disrespect to this Parliament and all the charities that are concerned about the issue. Is it in your power to encourage colleagues to keep their remarks within bounds, so that the key clauses can be reached?

[The Chairman of Ways and Means (Mr Lindsay Hoyle)]

It is not just the Minister who has been inundated with people’s views. That is not a point of order because, as the hon. Gentleman is well aware, the debate has been guillotined and is time limited. I am sure, however, that hon. Members have taken on board the comments made.

Clause 26

Meaning of “controlled expenditure”

[John Thurso (Caithness, Sutherland and Easter Ross) (LD)]

I beg to move amendment 47, page 12, line 23, leave out ‘subsections (2) to (4)’ and insert ‘subsection (2)’.’.

[The Chairman of Ways and Means (Mr Lindsay Hoyle)]

With this it will be convenient to discuss the following:

Amendment 62, page 12, line 24, leave out subsections (2) to (4).

Amendment 46, page 12, line 28, leave out subsections (3) and (4).

Amendment 131, page 12, leave out lines 31 to line 3 on page 13 and insert—

‘“For election purposes” means activity which can reasonably be regarded as intended for the primary purpose of—

(a) promoting or procuring electoral success at any relevant election for—

(i) one or more particular registered parties;

(ii) one or more registered parties who advocate (or do not advocate) particular policies or who otherwise fall within a particular category of such parties; or

(iii) candidates who hold (or do not hold) particular opinions or who advocate (or do not advocate) particular policies or who otherwise fall within a particular category of candidates; or

(b) otherwise enhancing the standing—

(i) of any such party of parties; or

(ii) of any such candidates,

with the electorate in connections with future relevant elections (whether imminent or otherwise).’.

Amendment 64, page 12, line 31, leave out ‘or in connection with’.

Amendment 168, page 13, line 30, at end insert—

‘() the amendments made by this Part shall not apply to elections to the Scottish Parliament, unless the Scottish Parliament so resolves.’.

Amendment 169, page 13, line 30, at end insert—

‘() the amendments made by this Part shall not apply to charities registered in the Scottish Charity Register maintained under section 3 of the Charities and Trustee Investment (Scotland) Act 2005 in relation to Scotland.’.

Amendment 132, in schedule 3, page 55, line 23, leave out sub-paragraph (3) and insert—

‘Any manifesto or other document setting out the third party’s view on the policies of one or more registered parties or of any category of registered parties or candidates.’.

Amendment 133, page 55, line 32, at end add—

‘in connection with an election campaign’.

Amendment 134, page 55, leave out lines 40 to line 4 on page 56.

Amendment 162, page 56, line 15, at end insert—

(c) in respect of staffing costs incurred for election purposes, as defined in section 85(3).’.

Amendment 167, page 56, line 15, at end insert—

‘(c) in respect of the remuneration or allowances payable to any member of the staff (whether permanent or otherwise) of the third party.’.

New clause 4—Charity or non-party campaigning

‘Nothing in Part 2 of this Act shall limit the capacity of a charity or non-party campaigning organisation to comment on public policy in so far as it does not seek to influence the outcome of an election in so doing.’.

New clause 6—Expenditure within third party groups

‘(1) Part 6 of the Political Parties, Elections and Referendums Act 2000 (controls relating to third party national election campaigns) is amended as follows.

(2) After section 87 insert—

“87A Expenditure within third party groups

(1) For the purposes of this Part, third parties which have formed part of a group of third parties (“a group”), for the purposes of undertaking activities to influence the outcome of an election, have only a duty to account to the regulator for expenditure that the third party has incurred for election purposes, as defined in section 85(3), and not for expenditure by the group or groups of which they have formed part.

(2) Each group shall designate a person or persons responsible for reporting to the regulator expenditure by the group incurred for election purposes.

(3) A donation by a third party to a group for the purposes of undertaking activities to influence the outcome of an election shall count towards the expenditure limits established in section 94 and Schedule 10.”.’.

New clause 9—Impact of Part 2 on elections and referendums in Scotland, Wales and Northern Ireland

‘Within two months of the day on which this Act receives Royal Assent, the Electoral Commission and the Minister shall lay a report before both Houses of Parliament containing—

(a) an assessment of the separate and specific impacts of Part 2 of this Act on third-party engagement in elections to the Scottish Parliament, the National Assembly for Wales and the Northern Ireland Assembly, and to the House of Commons in respect of constituencies in Scotland, Wales and Northern Ireland; and

(b) an assessment of the impact of Part 2 of the Act on referendums held or to be held in Scotland, Wales or Northern Ireland.’.

New clause 10—Assessment of effect of third party campaigning on UK elections

‘(1) Within 12 months of the passing of this Act, the Secretary of State must set out a report that includes his assessment of the effect that the actions of third party campaigning has had at elections in the UK, which shall include—

(a) an assessment of the impact of third party national election campaigns as regulated by Part IV of the Political Parties, Elections and Referendums Act 2000,

(b) the impact of any other third party campaigns which in his opinion have had an impact on elections,

(c) evidence of public opinion on the benefits and adverse impacts of third party activity at election time, and

(d) an assessment of the existing controls on third party campaigning at elections in the UK, and how these compare to other countries.

(2) In drawing up the report under subsection (1), the Secretary of State must consult—

(a) the Electoral Commission,

(b) the Charities Commission,

(c) the Governments of the devolved nations,

(d) political parties,

(e) such persons or organisations who campaign to affect policies or politics,

(f) such persons who may publish opinions, whether on paper or electronically, that may be intended to influence policies or politics, and

(g) any other person he considers could be affected by controls on third party campaigning.’.

Clause stand part.

Schedule 3 stand part.

[John Thurso]

May I start by saying what a pleasure it is to serve under your chairmanship and eagle eye, Mr Hoyle? Having regard to the point of order I shall keep my remarks as brief as I can.

Amendment 47 stands in my name and that of my right hon. and hon. Friends, and is linked to amendment 46. I will also speak to new clause 4 although I do not intend to speak to any other amendments. Briefly, let me explain the context behind why I tabled these amendments. Part 2 of the Bill sets out limits and rules relating to non-party political campaigning. As I understand it, the Government’s intention is to draw a clear distinction between the activities of those such as charities and interest groups that seek particular policy outcomes that they promote to all candidates and parties in an election, against those third parties that seek to influence the outcome of an election by support or opposition to particular parties or candidates.

Our electoral system is based on a principle enshrined for many years that all political activity at elections, whether by established party or non-party groups, is regulated as to the amount of expenditure they may use. That is a long-held view. Our electoral system has held that unlimited funding on the US model is not how we wish to do our politics or elections, and that we should have expenditure limits. I wholly concur with that principle.

It is therefore right that non-party political campaigns should be subject to that principle just as much as parties—a point that was clearly accepted in the Political Parties, Elections and Referendums Act 2000. Indeed, if one were to reverse the argument, it would be very odd if non-partisan groups, or even charities, were to argue that they alone should be free to have an unfettered right to spend money with regard to who wins or loses an election, either in the country or an individual seat. Notwithstanding that principle, there are justifiable concerns about some aspects of the drafting of this Bill, and the amendments seek to address one such concern.

Clause 26, as drafted, amends section 85 of the 2000 Act. Amendment 47 paves way for the meat of the issue, which is amendment 46. It simply puts forward the proposition that we should leave the status quo in place. By deleting subsections (3) and (4), the amendment seeks to state that the Government wish to proceed on the basis that nothing has changed in that definition, so that is what we should have. My proposition is straightforward: let us stick with the status quo.

[The Deputy Leader of the House of Commons (Tom Brake)]

I thought it might be useful to my hon. Friend and other hon. Members if I intervened at an early stage to say that the Government have listened to the concerns expressed by charities. My right hon. Friend the Leader of the House met the National Council for Voluntary Organisations on Friday. We intend to introduce amendments on Report that will address many of the concerns that my hon. Friend, the hon. Member for Nottingham North (Mr Allen) and other hon. Members have expressed. I assure my hon. Friend that the concerns he is expressing will be addressed on Report.

[John Thurso]

I am extremely grateful to my right hon. Friend. I was about to say that I hope the proposals find favour in the eyes of the Government and that they accept them. If he is saying that the Government accept the principle behind the proposals and would like to introduce on Report an amendment that does the same thing, it would be extremely churlish of me not to accept it.

[John Healey (Wentworth and Dearne) (Lab)]

I support the hon. Gentleman’s arguments and his attempts to amend clause 26, but Opposition Members have a lot of experience of the gap between what Ministers say and what they do. The clause is a noose around the neck of democratic election debate. It gags those who have a passion to play a part in challenging politicians, and, as the hon. Gentleman has said, it is a curb on the campaigning activities of trade unions, charities, Churches and others. If the Minister produces amendments on Report that do not do what the hon. Gentleman and his hon. Friends want, will he vote against them?

[John Thurso]

I remember having very happy intercourse with the right hon. Gentleman when he was at the Dispatch Box, so I will maintain my benign view and wait to see the outcome before making any such decisions.

[Paul Flynn (Newport West) (Lab)]

Does the hon. Gentleman believe that the status quo is perfection when, in recent years, groups such as the Countryside Alliance and individuals such as Lord Ashcroft have, between elections, targeted huge resources in a few marginal constituencies to affect the result of the vote? Should not that abuse be reformed?

[John Thurso]

My understanding is that that is precisely what clause 26 intends to do, and I sincerely hope it succeeds.

[Mr Allen]

May I put on record my thanks to the Minister for making it clear that there will be clear words in the Bill that meet the hon. Gentleman’s proposal in amendment 47, and that meet the proposals of the Select Committee on Political and Constitutional Reform? The provisions must be clear in the Bill, and I welcome the fact that the Government have engaged in the process on clause 26. There are 30 or 40 clauses, and I hope that this sets a precedent for other clauses that are subject to equally fierce criticism from the charitable and voluntary sectors.

[Susan Elan Jones (Clwyd South) (Lab)]

rose—

[John Thurso]

Before I speak to new clause 4, I will give way to the hon. Lady.

[Susan Elan Jones]

Has the hon. Gentleman had the opportunity to read the NCVO parliamentary briefing from yesterday? It will seek legal advice on the new wording and go to the Electoral Commission. It expresses great concern that voluntary organisations could be subject to “ambiguous and damaging legislation” and makes the point that the

“list of activities that count towards controlled expenditure remain neither clear nor workable”.

The Minister’s suggestion that he has suddenly achieved great consensus does not seem to agree with the spirit of the NCVO briefing.

[John Thurso]

I have read that briefing, but I am speaking to amendment 47 to clause 26. My understanding is that it will meet the concerns I have expressed, but I will wait to see what my right hon. Friend the Deputy Leader of the House says before coming to a final decision.

[Lady Hermon (North Down) (Ind)]

The hon. Gentleman has been generous in taking interventions. The Deputy Leader of the House has indicated that the Government will amend the Bill on Report, but what if the Government do not introduce the essential and necessary amendments to clause 26? What assessment has the hon. Gentleman made of the impact of part 2 of the Bill, unamended, on charities?

[John Thurso]

We are in Committee, and a great many amendments have been tabled. I will make a judgment on exactly what the Bill does at the end of Committee and Report. I have expressed concerns and tabled amendments, and would like to see how we get on.

[Tracey Crouch (Chatham and Aylesford) (Con)]

The Electoral Commission has described the provisions of part 2 as making major changes that will widen the range of activities that are regulated if they are carried out for election purposes. Does the hon. Gentleman share my concern that the measure could impact on newspapers’ ability to endorse either or both political parties and individual candidates, and thus impact on freedom of the press?

[John Thurso]

I am unlikely to get inspiration from anywhere, so my short answer is that I do not know. However, to my mind, nothing in the Bill should do that. I would be extraordinarily opposed to anything that sought to curb the press in that way.

[Tom Brake]

To be helpful to my hon. Friend, there is a specific exemption for newspapers in the 2000 Act.

[John Thurso]

I am most grateful to the Minister.

[Caroline Lucas (Brighton, Pavilion) (Green)]

rose—

[John Thurso]

I will give way for the last time—I am in danger of being unable to intervene on my own speech.

[Caroline Lucas]

I am grateful to the hon. Gentleman for his generosity in giving way. Does he agree that, when the Government clarify their position on clause 26, they should also clarify the problem they believe they are fixing in part 2 of the Bill? Does he agree with the Government’s assessment that there is too much campaigning at election time? How much democracy does he believe the Government will feel comfortable with?

[John Thurso]

I set out my answer to that question at the outset of my speech. I hope that nothing in the Bill stops any charity or voluntary organisation campaigning vigorously for a policy outcome. However, any third-party organisation or group campaigning on the outcome of an election—for or against a particular candidate or party—should be within the scope of the Bill and under the same rules as anybody else engaging in the political process. That is my understanding of the top line and I hope we can get to that position.

New clause 4 seeks to assist on precisely that point. It would mean that the intention of the Bill is clear and beyond doubt or peradventure. As I have stated, there is no intention to stop any group campaigning for a policy. My proposal would mean we have clarity that the purpose of the Bill is to stop people politicking for a particular result except within the rules.

On Second Reading, the hon. Member for Bolsover (Mr Skinner) asked about the student tuition fee campaign at the last election and said that it would not be allowed under the Bill. In fact, the student tuition fee campaign would not, as I understand it, be caught by the legislation. New clause 4 seeks to make that absolutely clear.

[Andrew George (St Ives) (LD)]

I support new clause 4 and the other proposals my hon. Friend has tabled. Part 2 of the Bill is still taking a sledgehammer to crack a nut. Following Friday’s meeting, it is clear that organisations such as the NCVO are reassured—[Interruption.] They are reassured but not entirely supportive of the Bill or of part 2. I encourage my hon. Friend to ensure that the Government continue their conversation with the NCVO and the charitable sector to ensure we get it right.

[John Thurso]

My hon. Friend makes a good point.

New clause 4 speaks for itself. The arguments I have made are quite clear. I hope my right hon. Friend the Deputy Leader of the House will accept this extraordinarily well-drafted and brilliant new clause. At the very least, I should like a clear explanation of why it might not be needed and how we can achieve the same result.

13:59

[Wayne David (Caerphilly) (Lab)]

What a mess! In 12 years in this House I have never seen such an incoherent, poorly thought out, badly drafted Bill. The whole Bill is confused and contradictory, but I have to say that part 2 is woeful.

In this group of amendments to clause 26, we see a wide range of concerns that highlight the genuine breadth of concern with the proposed legislation. Let me remind the Committee that the Bill has had no pre-legislative scrutiny and that there was no attempt by the Government to consult the many organisations that will be affected. There was no prior consultation with the devolved institutions or even the Electoral Commission, which will have the unenviable task of ensuring that the Bill is implemented properly. Like the Electoral Commission, we believe there is a need to review and update the UK’s party and election finance laws. The Electoral Commission has made 50 proposals for change, but have the Government had any dialogue with the commission? The answer is no. They have simply pulled out of a hat these half-baked, ill-thought-out proposals.

[Mr Allen]

We have just heard that the Government will bring forward new wording on clause 26. It would be helpful if my hon. Friend the Member for Caerphilly (Wayne David) encouraged the Minister to get to his feet and tell us whether he will do this time what he failed to do the last time, which is consult those affected before the wording is put before the House. Will my hon. Friend also allow us to correct the misapprehension, I am sure, of the hon. Member for St Ives (Andrew George), who said that the NCVO is now satisfied with the discussion it had on Saturday. If he reads the briefing that has been sent to Members today, he will realise that that is far from its position. It still has many anxieties regarding clause 26, let alone the even more important clause 27, which we will come to shortly.

[The Temporary Chair (Jim Sheridan)]

Order. May I say that interventions are becoming somewhat long? To make sure that every Member is accommodated, I will cut the length of interventions.

[Wayne David]

My hon. Friend the Member for Nottingham North (Mr Allen) the Chair of the Select Committee, has almost taken the words out of my mouth. He makes some good points.

Before I focus on my hon. Friend’s apposite comments, I would like to stress the fact that the Bill was published just before the summer recess. It is to the credit of the Political and Constitutional Reform Committee and its Chair that during the recess it sat in special session to consider the Bill. The Chair and other members of the Committee have come forward with a number of constructive amendments—amendments 132 to 134—on a cross-party basis. I am sure hon. Members will have noticed that during the recess their e-mail boxes were inundated with hundreds of e-mails from 200-plus organisations and charities ranging from Oxfam, Friends of the Earth, Save the Children and the British Legion.

[Andy Sawford (Corby) (Lab/Co-op)]

As a relatively new Member, I agree that we have had a huge amount of representations from the public—this is the issue on which I have had most contact from the public. Does my hon. Friend share my view that those representations are almost universally against the proposals, which are believed to be rushed and inadequate?

[Wayne David]

Yes, my hon. Friend is absolutely correct. The wealth of concern expressed by voluntary organisations and charities across the board has been spectacular. They are all desperately concerned. They are drawn from civil society and are concerned that the Bill will undermine their ability to campaign on, and even raise, important issues in the run-up to general elections and other elections.

[Andrew George]

I would like to correct the intervention by the hon. Member for Nottingham North (Mr Allen). The NCVO indicated to me that it was to an extent reassured, and Stuart Etherington said the change in the Government’s position was tantamount to a significant step in the right direction. That does not mean, and I did not say, that the NCVO and the charitable sector are now completely happy with part 2 of the Bill—they most certainly are not.

[Tom Brake]

rose—

[Wayne David]

I will refer specifically to the NCVO position and what has happened in the past few days, but I want to make this point first. There has been a groundswell of concern over the summer. Just a few days ago, before the NCVO meeting, the Leader of the House responded to concerns by saying, “Don’t worry, you’ve all got it wrong. We are absolutely certain that we are right and you are all wrong. This won’t affect charities and voluntary organisations at all.” That was the Government’s line. On Friday, as has been said, he changed his tune and indicated to the NCVO that there would be a concession. I would like to know what precisely the concession will be. The Deputy Leader of the House wanted to intervene a moment ago. Perhaps he can say precisely what the concession will be.

[Tom Brake]

I thank the hon. Gentleman for giving way. I thought it would be useful if he had on record what Stuart Etherington from the NCVO said in relation to clause 26—and it relates to clause 26 only, not to other clauses:

“I am pleased that the Government has listened to and significantly met the concerns of charities and community groups. I understand the Government’s intention was not to make their normal work subject to this regulation. We will work closely with the Government and the Political and Constitutional Reform Committee in order to deliver this intention.”

I am a little afraid that that might mean that the hon. Gentleman has to rewrite his speech. There is a clear undertaking from the Government to work with the NCVO to ensure that it, and indeed my hon. Friend the Member for Caithness, Sutherland and Easter Ross (John Thurso), are happy about clause 26.

[Wayne David]

I read the press release issued on Friday and I had discussions with the NCVO only this morning. It has issued a brief that updates its position, saying clearly—as I do—that it welcomes this movement, but that the Government have a heck of a long way to go. There is nothing to stop the Government today putting forward, on the Floor of the House, a written commitment to give us an outline of what they want to do. All we have had is a nod and a wink and a promise.

[John Cryer (Leyton and Wanstead) (Lab)]

I am looking at the legal advice written by Helen Mountfield QC for the NCVO. In relation to controlled expenditure, she states:

“The real vice of the new definition is the lack of clarity, and the consequent lack of certainty as to when expenditure…ought to have been included”.

That sets out the position clearly. It is very uncertain what is going to happen when this becomes law. We will then have a plethora of court cases and the law will be decided by precedent.

[Wayne David]

My hon. Friend puts his finger on an important point that highlights the lack of clarity and the confusion at the heart of the Bill. We have heard the fine words of the Deputy Leader of the House on what the Government intend to do, but will he give us this commitment: will he put in writing, by means of a draft amendment that he can amend if necessary, what he has said to the Committee today? Will he provide that substantive material? Please reply.

[Tom Brake]

I thank the hon. Gentleman for that offer. I am sure he would prefer that the Government’s legal counsel ensured that they work to build up the amendment—on which we have already given an undertaking to work with my hon. Friend the Member for Caithness, Sutherland and Easter Ross and, as Stuart Etherington has indicated, the NCVO—to ensure that, on Report, the fundamental concern of charities over the confusion that they say the Government have introduced into the definition of election materials and election purposes will be addressed.

[Wayne David]

I respectfully remind the Minister that the Bill was literally drafted on the back of an envelope in a couple of days. All we are asking is that the Government give us a draft amendment, subject to all the caveats that they want to put in about legal advice and so on, so that we have, in writing, the Government’s commitment. Otherwise many people will think that these are simply hollow words from the Government.

[Paul Flynn]

Does my hon. Friend think that the Government are advertising their incompetence by presenting us with some promise that, on Report, they will change the Bill, while suggesting that we all waste our time today dealing with a Bill that might be very different on Report? Why on earth do the Government not try to amend the Bill now?

[Wayne David]

My hon. Friend makes a very good point. Clause 26 and schedule 3 are absolutely central to the Bill because everything follows on from them. If the Government do not get this right and do not sort out what they are going to do here, everything that follows, frankly, does not make much sense.

[Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)]

My hon. Friend is making an extremely strong case. Is it not exactly this lack of clarity, confusion and chaos that will act as a net dampening effect on the campaigning activities of charities? No matter what detail comes out during this debate, a lot of them will look at this Bill and wonder whether they can carry on campaigning as they have done in the past.

[Wayne David]

That is a fundamental concern. Due to the intricacies of the Bill and its convoluted nature, we suspect that many charities and campaigning organisations will say, “How on earth can we comply with this in all reasonableness? The best thing to do is not to do any campaigning at all.” That is our concern.

[Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)]

My hon. Friend will have noticed, as we all did, that the Minister said that draft amendments will be tabled on Report, which fortuitously is a few weeks away due to the parliamentary timetable. I am sure that my hon. Friend will agree that we do not want those amendments to appear on the day of Report, or a couple of days before. They should be produced well in advance. Would it not be right for the Minister to give an indication of when the draft amendments will be tabled?

[Wayne David]

My hon. Friend makes a very good point. We would seriously hope that the Government are learning lessons from their very obvious mistakes. One of the most obvious mistakes is the complete absence of any prior consultation. Even at this stage, we genuinely hope that the Government will learn the lesson. As the Electoral Commission has said, having apparently promised this concession, the Government need to consider how best to clarify the position of controlled spending before putting any firm amendments to Parliament.

Surely it is now appropriate for the Government to withdraw the Bill in its entirety and open meaningful discussions with all who are affected by it. It is surely sensible to extricate Parliament from the mess the Government have got it into. If the Government were to do this, we as the Opposition would play a constructive role in helping to revise electoral law, which needs to be revised, so that big money is taken out of politics. But let me be clear: the Bill cannot be put right simply by modifying the definition of electoral activity in clause 26. There is a need carefully to look at schedule 3 and at all the categories listed therein.

Amendment 167, in my name and that of my hon. Friend the Member for Penistone and Stocksbridge (Angela Smith), refers to staff costs. The Government have said that they wish to equate the rules of third sector spend with the rules on political party spend. Yet in schedule 3 voluntary organisations will have to take into account staff costs even though that is not the case for political parties.

14:15

[Andrew Gwynne (Denton and Reddish) (Lab)]

One of the issues for many of the organisations that have objected to the Bill is that they campaign jointly in the form of coalitions on key issues, yet the Bill would mean that they have to account for the total cost of the campaign for each individual organisation—in effect, double accounting.

[Wayne David]

My hon. Friend makes a very good point. Not only is the Bill a burden on individual organisations, it is a burden on them collectively. When organisations co-operate and co-ordinate their plans, the total spending of those organisations would count against the individual spending limit of each organisation. I have heard the Minister chuntering that that is already the case. It is not. The Bill seeks to modify, reinforce and extend what is currently the case and new clause 6 seeks to simplify reporting arrangements to the Electoral Commission. I hope that when the Government look at redefinitions, they also look at other aspects of the Bill such as this.

I want to give one further example of the incoherence of the Bill. Clause 26(6) says that if a person is charged with an offence of making an unauthorised expenditure, they will be able to defend themselves by referring to a code of practice issued by the Electoral Commission. Fair enough. That code of practice will be issued under paragraph 3(2) of schedule 3. But the Electoral Commission, of course, has not produced a code of practice. Indeed, as I said, the Electoral Commission has not even been consulted. Can you believe it? Talk about putting the cart before the horse. We are debating a Bill that, in part, has not even been drafted, let alone consulted on.

This is an inhibiting piece of legislation. It seeks to restrict and curtail civil society or, if hon. Members prefer, the big society. Its impact will be felt especially in Scotland, Wales and Northern Ireland.

[Mr Allen]

The Electoral Commission is a very well-respected, impartial and apolitical body. It was not consulted about the Bill until very close to publication. The Bill contains a number of items that change the terms of reference of the Electoral Commission. It was not consulted about those changes. The Bill makes a group of respected civil servants, in a sense, responsible for policing the measure—perhaps by going in and tearing down bunting and signs, or arresting people who are breaking the provisions. The commission is deeply uncomfortable with being given this role.

[Wayne David]

My hon. Friend, the Chair of the Select Committee on Political and Constitutional Reform, makes a very good point. His specific points relate to a later part of the Bill but it is important, in this context, to reinforce what he has said. New powers are being bestowed on the Electoral Commission that it does not want because they will allow the commission to become judge and jury on a whole range of difficult and complex areas without a clear piece of legislation to rest on. Its concern is that it will be sucked into a legalistic quagmire, which is bad for electoral politics generally in this country. This is a recipe for chaos.

Amendments 168, 169 and 171, and my new clause 9, focus on the problems and uncertainty that the Bill creates in the devolved regions and nations. It has been said that the interface between this Bill and the currently existing rules is not straightforward. In essence, I would suggest that three things appear to be clear; the Minister can correct me if my interpretation is wrong. First, it is clear that clause 26 and schedule 3 will apply to all devolved elections, as well as to general elections. Secondly, it is clear that clause 31, which focuses on the registration procedures of the Electoral Commission, will also apply to devolved elections. Thirdly, it is clear that clause 27, with new registration thresholds, will also apply to devolved elections.

However, other aspects of the Bill, which I have not mentioned, will not apply to devolved elections. The application of the Bill to devolved elections is important because the conflict between the different aspects of the legislation will create enormous difficulties in Wales, Scotland and Northern Ireland. Those issues are particularly important in those countries because the third sector plays a far greater role in the devolved institutions than it does in England. That is particularly so in Northern Ireland, where the impact will be greatest of all. It gives me a great deal of pleasure to be the president of the Council for Wales of Voluntary Youth Services—I hasten to add that I am in receipt of no remuneration for that honorary position. I know that the relationship of the voluntary youth sector in Wales with the Welsh Assembly is healthy and positive. This Bill makes that relationship more difficult, yet there has been no consultation with any of the devolved Administrations.

[Ann McKechin (Glasgow North) (Lab)]

My hon. Friend is quite right to raise those concerns. The upcoming referendum on independence in Scotland is just over a year away and will occur within 12 months of the next general election. A whole range of voluntary organisations in Scotland are already intending to make representations in that constitutional debate. Does he share my concern that they will get sucked into the issue of expenditure controls in the general election campaign, too?

[Wayne David]

Either my hon. Friend has seen my speech or she is telepathic, because I was going to make exactly the same point. There is an overlap between the referendum campaign in Scotland on the crucial issue of independence and the 12 months prior to the next general election, but the Government are yet to show any appreciation of the potential difficulties that could be caused in identifying the respective areas of spend. I would like a categorical commitment from the Government that they will provide a written statement setting out precisely how such difficulties could be avoided or, if they occur, addressed successfully.

It gives me no pleasure to say that this Bill is a monumental shambles. As the Financial Times said in its leader on Monday, the Bill ought to be withdrawn, and legislation affecting political funding and elections should be the subject of cross-party agreement. That should also involve the Electoral Commission in all discussions, as well as the charities and campaigning organisations that would be directly affected by the Bill. It is high time that the big money is indeed taken out of politics. It is also important that we as a House stand full square behind our collective desire to ensure that civil society is a vital part of a healthy democracy. It is a great shame that apparently the Government do not hold that view.

[Mr David Davis (Haltemprice and Howden) (Con)]

I rise to support my hon. Friend the Member for Caithness, Sutherland and Easter Ross (John Thurso) and new clause 4. However, before I speak briefly about that, I want to respond to the comments made by the hon. Member for Caerphilly (Wayne David) at the beginning, because I am afraid to say that I largely agree with him.

I do not hold much of a brief for any of this Bill, but part 2 as it stands seems to be a very serious mistake. I am particularly concerned because it used to be a convention, at least when I came into the House, that we did not guillotine constitutional Bills, yet part 2 goes to the heart of our democracy and free speech, as demonstrated by the opponents to the Bill. I know of no previous Bill that had ranged against it Christian Aid and the British Humanist Association, Greenpeace and the Countryside Alliance, or the Royal British Legion and the Salvation Army. It is a Bill that has attracted opposition precisely because it goes to the heart of all that those organisations do—not what they stand for, but what they do and how they execute their duty in society.

[Mark Lazarowicz]

The right hon. Gentleman makes an important point. Although it is not such a broad constitutional issue, is it not also the case that the points we have raised about the implications for Scotland, Wales and Northern Ireland are genuine concerns, not just points we are making today, and that if we do not get them right, there is a danger that we will produce legislation that is, frankly, unworkable?

[Mr Davis]

That is why I start from my concern about the guillotine, because this is a Bill that in past decades—not past years, sadly—would have spent hours, days and weeks on the Floor of the House. It would have been preceded by a proper consultation, a cross-party agreement, a Green Paper and a White Paper—there was a White Paper, but as far as I could tell, it did not refer to part 2 at all. The Bill has not gone through what in my view would be a proper constitutional process and so will of course be subject to unintended consequences all over the place.

I accept that the Government will not have intended many of the consequences—I will come to some that they do intend in a minute. I accept that the deleterious consequences of the Bill were not intentional, but they arise directly from how the Government started the process. We had a brilliant report from the Political and Constitutional Reform Committee, as chaired by the hon. Member for Nottingham North (Mr Allen), which could have provided a basis. That Committee could have been the vehicle for the process. The hon. Gentleman is right: there will be deleterious consequences, most of them unintended, but most of them because of how we have addressed this Bill.

[Angela Smith (Penistone and Stocksbridge) (Lab)]

Does the right hon. Gentleman agree that the National Council for Voluntary Organisations has made it clear that it has similar concerns outstanding, despite the apparent movement by the Government on clause 26? It says in its brief:

“'We remain concerned that…voluntary organisations…may still be subject to ambiguous and damaging legislation. NCVO believes in a society where freedom of speech, the freedom to associate and the right to free and fair elections are all similarly inviolable.”

[Mr Davis]

Let me pick up that point and develop it a little—we are principally talking about clause 26, but it also relates to later clauses, which will be dealt with later in the day. It is in this context that the comments from the Electoral Commission—the primary executing agency of this Bill—come into play. It uses the words “significant regulatory uncertainty”, saying that parts of the Bill are “impossible to enforce” and pointing out “significant issues of workability”. What are we doing? We are transforming a bureaucratic organisation, with the powers to make rules on policy campaigning, as well as to relax those rules, tighten the rules, amend them retrospectively and then apply them retrospectively to freedom of speech—something that is, by definition, oppressive. By definition, that will chill freedom of speech. This Parliament has created a bureaucracy without the ability to alter, change or amend the rules before—it was known as the Independent Parliamentary Standards Authority. What we are creating in this Bill is—if we want a precursor of how this will play out—an IPSA for elections.

Let me turn to new clause 4. When it comes to political campaigns—whether electoral campaigns or other campaigns—the world is changing. Twenty-five years ago, I think only 8% of the population did not feel an affinity to one or other party. That figure is now 25%. All the political parties are declining—there is no party point in this; we are all dying on the vine as organisations. It is the nature of society that people’s interest in something tends to be more piecemeal than it was 25 or 50 years ago. This Bill is trying to swim upstream. It is trying to defy the nature of modern politics and the fact that political decision making now is by web-based campaigners, web-based petitions or 38 Degrees.

I get as annoyed as everyone else when I get campaigners from 38 Degrees writing to me—they say that they sometimes get dusty replies—but as Voltaire would have put it, I may disagree with what they say, but I defend to the death their right to say it. What part 2 does—not intentionally, but by accident—is jeopardise that entire tradition of our country. This is the home of free speech and this Chamber is the original defender of free speech, so what are we doing making these changes by accident? That is why I am concerned.

[Stephen Doughty]

The right hon. Gentleman is making an extremely strong point. Does he agree that 38 Degrees is facilitating the ability of our constituents to make their voices heard? It is not campaigning itself, separately from society. The Bill would cut down the ability of our constituents to make their voices heard on many crucial issues.

14:36

[Mr Davis]

The hon. Gentleman invites me to commit political suicide by confessing that I have used 38 Degrees in some of my campaigns. Sometimes I am for, and sometimes I am against. The organisation is part of the modern mechanism, and it is not the only one. It was, after all, based on similar organisations in America and Australia. That is the way politics is going and, frankly, my constituents should judge me on whether I voted for the proposed Syrian war. They should judge me on whether I voted for tuition fees and on how I voted on this, that or the other measure.

If I may, I shall disagree with the author of new clause 4, my hon. Friend the Member for Caithness, Sutherland and Easter Ross, on one point. He said that the hon. Member for Bolsover (Mr Skinner) was wrong to claim that it was an attempt to protect the Liberal party from the National Union of Students, but I was told by a member of the Liberal party that that is exactly what it was intended for. The raw truth is that, in our trade, we should be willing to stand by our principles and our aims, and by what we actually do. We should live or die by that, in political terms.

I want to make one more point, and I shall make it directly to the Minister on the Front Bench. As I have said, this section of the Bill deals with a constitutional matter and goes to the heart of free speech in our society. Undertakings have been given by those on the Front Bench—entirely in good faith, I imagine. The Deputy Leader of the House of Commons, my right hon. Friend the Member for Carshalton and Wallington (Tom Brake) has been teased about tabling a manuscript amendment, because that is not the way to do it. We should do it properly, with proper legal advice and taking a wide range of contributions from the very people who will be affected. What the Government should have done before the Bill was presented to the House should be done now. If it is not done now, and if what is presented on Report is unacceptable, it will probably still get through, although I shall vote against it.

[Paul Flynn]

Will the right hon. Gentleman give way?

[Mr Davis]

I am on almost my last line, so I hope that the hon. Gentleman will forgive me if I do not.

The Bill would probably still get through in those circumstances, but it is probable that the House of Lords, whose primary function is to act as a defender of our constitutional rights, would strip out the whole central section of the Bill. That is what it ought to do, and that is what it will do if the Government do not get the next stage right.

[Dr Eilidh Whiteford (Banff and Buchan) (SNP)]

It is a great pleasure to follow the right hon. Member for Haltemprice and Howden (Mr Davis). He has made an important and valuable contribution to today’s debate. When we debated the Bill on Second Reading, the most serious concerns raised by Members on both sides of the House related to clauses 26 and 27, so I am glad that we are debating this robust and constructive set of amendments this afternoon. I am also glad that the Government have acknowledged that certain aspects of the proposals are problematic and have agreed to table amendments on Report.

The principles and the workability of this part of the Bill are problematic, and I hope that the Government will look at it again. In particular, they have sought to distance their intentions from some of the scenarios that have been outlined by civil society groups, but we must concentrate on the actual text that will form the basis of the courts’ interpretation of the legislation. I reiterate a point I made the other day about the explanatory notes to the Bill, which state clearly:

“The definition of the term ‘for electoral purposes’ does not rely solely on the intent of the third party; the effect of the expenditure must also be considered.”

That illustrates the Bill’s ambiguity and lack of clarity.

The Electoral Commission has consistently raised the concern that, under this part of the Bill, it will acquire a wide discretion to interpret whether third party activities fall within the regulatory framework established by the Bill. Neither the commission nor I thinks that that is an appropriate role for it. Its role is to regulate, not to decide what should be regulated. I share the concern expressed earlier by the Chair of the Select Committee, the hon. Member for Nottingham North (Mr Allen), on this point.

The Electoral Commission has also expressed what I suspect are well-founded fears that, as things stand, any interpretation of regulated activity could be open to legal challenge. In the short time that we have been discussing these proposals this afternoon, we have already heard examples of organisations taking legal advice. The last thing any of us wants is for this to end up in protracted and expensive legal challenges. That would not be an appropriate way of deciding what the law actually is. We need clarity on the face of the Bill and in the explanatory notes. I observe that many of the amendments in this group share the common aim of clarifying and tightening up the Government’s definitions, and I shall be looking for assurances from the Minister that any amendments tabled on Report will tackle the issue of definitions, in order to avoid placing the Electoral Commission in that contradictory position—that conflict of interest, if you like—in relation to the job that it is being asked to do.

[Lady Hermon]

Will the hon. Lady give way?

[Dr Whiteford]

I would be delighted.

[Lady Hermon]

I am most grateful to the hon. Lady; it is nice to be greeted so warmly when making an intervention. I welcome the Government’s promise of amendments on Report, although I am sorry that they will not be tabled earlier. A key issue relating to clause 26 that the Government need to deal with is the use of the words

“future relevant elections (whether imminent or otherwise)”.

Does the hon. Lady agree that charities and other organisations will not know what “imminent or otherwise” means, other than that the elections will take place some time in the future?

[Dr Whiteford]

The hon. Lady provides a perfect illustration of the point that I was making. Parts of the Bill are so vague as to be nonsensical, and they will be open to all kinds of challenges. They are completely open to interpretation, and the words that she has just mentioned could mean 20 different things. It is exactly that kind of vague, ambiguous language that needs to be clarified. I worry that, at the end of the process, we shall be left with unnecessary complexity, unhelpful ambiguity and unintended consequences. I urge the Government to go back to the drawing board and take the time to consult properly with stakeholders on an appropriate and balanced set of measures to ensure that third parties can continue to contribute to the democratic process without having undue and disproportionate restrictions placed upon them.

I have particular concerns about the detrimental impact that the measures could have on civil society—and, in particular, on the voluntary sector—in Scotland. I shall not repeat the points made so eloquently by the hon. Member for Caerphilly (Wayne David) about the devolved Administrations and the disproportionate effect that the Bill could have on their legislative and electoral processes. This part of the Bill is a quagmire, and its consequences have not been adequately thought through. There has not been adequate consultation with key stakeholders, including elected parliamentarians in the Governments of the devolved Administrations, and it is important that we should take the time to go back and carry out that consultation properly.

One of the points that I made on Second Reading was that those third parties that are also charities are already regulated very effectively, and are explicitly prevented from engaging in party political activity. They are already significantly constrained in the activities they can undertake during an election period. In my extensive experience of the voluntary sector, charities—whether large or small—take those responsibilities seriously and tend to err on the side of caution when determining what they do when engaging with politicians and public policy processes in the run-up to elections.

[Mark Lazarowicz]

The point has been raised about the possible effect of the provisions on the Scottish referendum. Is it not ironic that the Scottish charities regulator has confirmed that charities can participate and put forward their views on the issue of independence, given that that could come into conflict with the terms of the Bill? Incidentally, there is even a possibility that the Scottish Government could be considered a third party for the purposes of this legislation in the run-up to the referendum.

[Dr Whiteford]

The hon. Gentleman makes a pertinent point. There has been a carefully considered process in Scotland, involving a partnership between the Electoral Commission and other stakeholders, to ensure that we have a fair, democratic and open debate around the referendum. I agree entirely with him that it would be counter-productive if this legislation were to cut across that process. That is one more reason for us to go back and look at the process in more depth.

It is not just in the run-up to elections that charities and civil society organisations take these issues seriously—they take them seriously throughout the electoral cycle. Fundamentally, I do not think that charities should have to cope with an extra set of regulations that overlap so extensively with existing charity law and other forms of regulation that seem to be working well. Charity regulation is certainly working well in Scotland, and since the introduction of the Office of the Scottish Charity Regulator in 2005, governance has been strengthened across the voluntary sector, and accountability has improved dramatically right across the sector in the most recent few years.

Charities play an enormously important role in our democratic process. They not only make the voices of their members and service users heard, but they actively influence and shape public policy in ways that are already much more transparent and accountable than is the case with corporate lobbying. I can think of numerous examples of pieces of legislation that have been actively enhanced by the input of charities, with far-reaching consequences for the quality of life of thousands of people. I think in particular of the Community Care and Health (Scotland) Act 2002, which was significantly amended by the efforts of stakeholders, including a range of small specialist health charities and large campaigning organisations working together to influence legislation and make it fit for the 21st century.

When I look back at the kinds of activities undertaken, fully transparently and accountably, by the charities involved in lobbying around that Bill, I can see that some of them would almost certainly have fallen within the terms of third-party campaigning proposed in the Bill. Some of the smaller organisations, particularly those with perhaps only one or two members of staff, advocating on behalf of small numbers of people perhaps with a rare condition, would simply have opted out of that discussion because they would not have had the resources to navigate the regulatory framework. That would have been to the enormous detriment of the legislation that finally emerged. As a society, we are all better off because of the inclusion of such organisations in the democratic process.

[John Thurso]

I have been listening carefully to all the arguments, particularly those of the hon. Lady, but I would really like to know the answer to this particular question. She is talking about legislation and about what I would consider to be absolutely proper lobbying by charities and the voluntary sector to achieve the best outcome for that legislation. I welcome and support all of that, but I am unaware that any of that activity would fall under the provisions of part 2 of this Bill, so I would be grateful if the hon. Lady could help me on that.

[Dr Whiteford]

The key point I am trying to make is that those organisations are already regulated, and we do not need any duplication of that regulation. A clear example I could give the hon. Gentleman would be the Climate Change (Scotland) Act 2009. Had this Bill been in force, it would have coincided with the 2010 general election, so the cross-party political consensus created around that Act—world-leading legislation—simply would not have happened. It was the key role of civil society actors that enabled and facilitated the emergence of that consensus. That is one of the reasons I am concerned that the Bill in its current form will inhibit democratic debate and not move us any further forward.

[Mr Allen]

To assist the hon. Lady—although she is making such a distinguished speech that she does not need any assistance—in response to that intervention, perception is very important. The substance shows that there are difficulties, a number of which have been identified, but the perception is such that over 200 individual organisations throughout the United Kingdom have expressed doubts and anxieties about the possibilities here—

[Mr Graham Stuart (Beverley and Holderness) (Con)]

They are wrong!

[Mr Allen]

They may all be wrong, as the hon. Member for Beverley and Holderness (Mr Stuart) says from a sedentary position, but a trustee would not gamble with the charity’s money, and would be chilled from engaging in perfectly legitimate political activity that we all celebrate at other times. That is why the Bill needs, at the very least, to be clarified in the way suggested by the hon. Member for Banff and Buchan (Dr Whiteford).

[Dr Whiteford]

I thank the Chairman of the Select Committee for his helpful intervention. Speaking as someone who has been a trustee of charities, very small and larger, more robust organisations working in a highly professionalised environment, I know just how true what the hon. Gentleman said is. Trustees of charities are inherently quite risk averse: they cannot fall back on huge reserves, and they are very careful in what they do. As I say, it is already a very regulated sector and, for the most part, a well-governed sector. The bigger the charity—this applies particularly to the big campaigning charities—the more attention gets paid to governance and to ensuring that it is operating within the law.

14:45

Let me return to the issue raised by the hon. Member for North Down (Lady Hermon) about the complexities of the wording and drafting of this legislation giving rise to confusion. I allude to my earlier point about some of the explanatory notes, which clearly demonstrate the ambiguity in how the Bill is drafted. We need to remember that our debate in this House, where we all agree on intentions, is not what the courts will use when they are looking at the black and white of this legislation to determine the law.

[Sheila Gilmore (Edinburgh East) (Lab)]

rose—

[Dr Whiteford]

I am anxious to make progress and conscious of the time constraints for this debate and the need to move on to consider further clauses. I am going to finish my speech shortly.

Increasing the regulatory burden on charities, which this Bill will do, will not improve transparency one jot, and it will not improve accountability. At best, it will add to and fuel the bureaucratic process, and at worst it will deter smaller organisations from engaging in public policy processes.

The purpose of my amendment 169 is simply to mitigate what I see as the worst potential side-effects of the Bill, but I believe that this part of the Bill needs wholesale redrafting, so I will be happy to support other amendments to that end.

The great irony of the Bill is that it fails to tackle the real problems in our culture of lobbying where certain parties have undue influence; instead, it creates a new layer of regulation on civil society actors who already operate with appropriate levels of transparency and accountability, many of which are already adequately regulated. This part of the Bill places obligations on some third parties that are not commensurate, proportionate or fair. I fear that it will be simply unworkable.

In speaking to amendment 169, I urge the Government to listen to those 200 organisations—not just to tell them that they are wrong, but to understand why they are concerned and accept that the drafting is well below par. Overwhelming concern has been expressed by civil society organisations about this Bill, which really needs a thorough overhaul.

[Stephen McPartland (Stevenage) (Con)]

I have been encouraged to speak to this part of the Bill. [Interruption.] I have not been whipped, although the Whips want to make progress. I have been encouraged to speak because some of the contributions have been very good. I am concerned, however, that there is a gap between the perception of clause 26 on controlled expenditure and the reality of that clause and what it does for controlled expenditure. My understanding of the law is that if a charity is engaged in an activity that might affect the outcome of an election, it needs to identify, first, whether that activity can be engaged in legally under charity law and, secondly, whether the activity would have an effect on the election. If it did have such an effect, the activity would, under current law, be considered to be part of controlled expenditure. I therefore think there has been a gap between the perception of the Bill and what it is actually trying to do.

I think that the contributions from the hon. Member for Caithness, Sutherland and Easter Ross (John Thurso) were very pertinent, as they tried to drill down on the important points. I was pleased to hear that the Minister will attempt to give some reassurance on Report about helping some of these charities. I am a big fan of Christian Aid, for example, and have worked with it on a number of campaigns. I have worked with other organisations, too, and I do not want any charities to be concerned or worried about the policy issues with which they can get involved.

I am a trustee of two small local charities in my constituency, and Stevenage has over 400 local charities and community groups. None of them has come to me with any concerns about the Bill. The concerns seem to come from many of the larger national charities. I am a big supporter of a number of those national ones and contribute to a number of their causes. I am proud of that.

[Sheila Gilmore]

Has the hon. Gentleman read the evidence given by the Electoral Commission to the Select Committee on this matter? It was concerned that the drafting was not good enough and would give rise to considerable problems, not just for these organisations but for the Electoral Commission in trying to administer the legislation.

[Stephen McPartland]

I did read the Electoral Commission’s evidence, and noted the Committee’s conclusion that it would need more resources—both money and people—in order to deal with the Bill.

I understand that under the present law, a number of charities would have to engage in the two tests of reasonability. They would have to ask first, “Do we want to be involved in an attempt to affect the outcome of this election, and is that allowed under the current charity law?”, and secondly, “Will the policy activity that we are undertaking be subject to controlled expenditure, as the law currently states?”

Like my right hon. Friend the Member for Haltemprice and Howden (Mr Davis), I am a huge supporter of free speech, and would not do anything that would affect it. I should be very disappointed if any measure in the Bill led to problems in that regard. The Chairman of the Political and Constitutional Reform Committee, the hon. Member for Nottingham North (Mr Allen), has made a number of impassioned contributions throughout the debate about the need for more pre-legislative scrutiny, and whether it should be the norm in the House of Commons.

[Stephen Doughty]

How does the hon. Gentleman expect charities to arrive at the answers to the two questions that he posed earlier? Does he think that employing legal advisers and regulatory experts to deal with what is a very poorly drafted piece of legislation constitutes a good use of their charitable funds at a time when they are under so much pressure?

[Stephen McPartland]

The hon. Gentleman will be surprised to learn that I listened closely to his speech on Second Reading, and I am aware that he used to work for Oxfam. He will know better than I that many people in Oxfam engage in the activities that we are discussing. Indeed, he said in his speech that he talked to legal experts about the issue. Activities of that type of are taking place at present.

[Paul Flynn]

The hon. Gentleman said that he had been encouraged to speak. Presumably, he was encouraged to do so by the Whips. Did the Whips explain to him that part 2, which was bound to incite the rage of charities all over the country, was in fact a smokescreen, which the Government will get rid of on Report? The whole point of it is for us to talk about this issue, and not about the great scandal of corporate lobbying, which the Government have not addressed in the Bill.

[Stephen McPartland]

When I said that I had been encouraged to speak, I meant that I had been encouraged to speak by the contributions that had been made in the Chamber. If the hon. Gentleman took a moment to look at my voting record, he would realise that when the Whips encourage me to speak, it is often with the aim of discouraging me from speaking, because I spend a bit of time in the same Lobby as the hon. Gentleman.

[Mr Allen]

I congratulate the hon. Gentleman on an excellent and well-balanced speech. He is teaching us that more unites us than divides us on these issues. In fact, on this occasion the division is between Parliament and Government, rather than between those on the Government and Opposition Benches.

May I correct, or rather add to, what the hon. Gentleman said about the Electoral Commission? In its evidence to our Committee, it said:

“we recognise that these are complex and potentially controversial changes that would need further thought and consultation before they are implemented.”

That view runs through the commission’s evidence, and underlines its fear that we are legislating in haste and will repent at leisure. The hon. Gentleman will have a chance to make another speech about this issue, probably at about the same time next year, if the Bill is passed in its current state.

[Stephen McPartland]

I understand what the Electoral Commission said, and I agree that that view runs through its evidence, but, as a Back-Bench Conservative Member, I have noticed that no matter what happens in the House, everyone is always calling for more time in which to debate a Bill. I am pleased that we have an opportunity, for once, to debate the Bill on the Floor of the House. I do not want to take up too much time, because I know that a range of issues are still to be debated, but I agree with the hon. Gentleman’s main point that there should be more pre-legislative scrutiny.

Let me now return to my central point. I genuinely believe that it is not the intention of part 2 to damage charities. We all work with charities in our constituencies, and we all support them. The intention of part 2 is to try to prevent super-PACs, or political action committees, and similar organisations from investing large amounts of money in a small number of constituencies in a way that could affect the outcome of a general election. I do not think that any Member on either side of the House would want that to happen.

[Wayne David]

Will the hon. Gentleman acknowledge that we are not talking merely about a knee-jerk reaction from the 200-plus charities and organisations involved? Many, indeed most, of them have taken legal advice, and a considerable body of legal opinion has placed a huge question mark over the Bill. I put it to the hon. Gentleman that if we do not take that into account, we shall be on very dangerous ground.

[Stephen McPartland]

I have great respect for the hon. Gentleman, who made an impassioned speech earlier, but for every 200 lawyers whom he cites, I could probably cite 300 who would say something completely different, because, as he knows, it would be in their interests to do so.

[Mr Graham Stuart]

My hon. Friend is making a powerful speech. He clearly agrees with me that we need to ensure that funds in individual constituencies for the purpose of delivering one particular result are brought under greater control. The Government have given a commitment, and I am prepared to accept it, but I want us to use the time that we have today to make absolutely certain that the fears and doubts about charities being chilled in their engagement in public debate can be dispelled. We want Ministers to assure us of that, and to confirm that they are utterly committed to it.

[Stephen McPartland]

That was a fantastic intervention. I said on Second Reading that a Committee stage debate on the Floor of the House would provide a great opportunity for Ministers to clear up some of our concerns, and we saw that earlier, when the right hon. Member for Carshalton and Wallington (Tom Brake) responded to what was said by the hon. Member for Caithness, Sutherland and Easter Ross.

[John Cryer]

The hon. Gentleman is being very generous in giving way. I think we should bear in mind the fact that we have been promised this Bill for three and a half years: the Prime Minister promised it three and a half years ago. There was a consultation exercise which closed well over a year ago, and which bore no relation to what is in the Bill. Now, after three and a half years, we are being told that we are waiting for an amendment which we should have before us today.

[Stephen McPartland]

The hon. Gentleman has summed up why we have waited three and a half years for the Bill, and why we do not want to wait any longer. We want to get the Bill going.

I believe that the purpose of part 2 is to prevent a small number of large organisations from channelling money in a way that would affect the outcomes of elections, irrespective of the level at which that happens. Its purpose is not to upset the local charities with which we all work, but to enable us to work with those charities to secure the best possible deal for our constituents and communities.

[Helen Goodman (Bishop Auckland) (Lab)]

A new low has been reached in the handling of the Bill. I do not think that we have seen such a shambles since the last occasion on which the Leader of the House was involved with a piece of legislation. At least on that occasion there was a pause when the Government decided to go back to the drawing board. This time, we seem to be being expected to debate a Bill which the Minister himself, from the Dispatch Box, has said is not adequate and must be changed. I am pleased to see that the Chair of the Procedure Committee, the hon. Member for Broxbourne (Mr Walker), is in the Chamber, because I feel that the Committee should consider the process issues connected with the Bill.

It is peculiarly ironic that the Minister, the right hon. Member for Carshalton and Wallington (Tom Brake), is a Liberal Democrat. One would think that, of all the things that the Liberal Democrats could defend, one would be liberal democracy. This is about the nature of our democracy, and I really think that the Liberal Democrat members of the coalition should learn to stand up to the Tory members. The Bill is clearly a highly political piece of legislation, aimed at defending Tory donors and attacking the civil society groups that might support any other political activity and any other political parties.

It is particularly worrying that the Parliamentary Secretary, Cabinet Office, the hon. Member for Norwich North (Miss Smith), has admitted in reply to a parliamentary question that the first time she spoke to voluntary sector organisations about the Bill was on Monday last week, at least two months after the publication of the Bill.

I do, of course, support amendment 47. I want to say a few things about my experiences working in the voluntary sector, as they help to explain why I am so horrified by the contents of clause 26. Before I was elected to this House I worked in three voluntary sector organisations: the Runnymede Trust, the Church of England Children’s Society and the National Association of Toy and Leisure Libraries, which I ran. The Church of England Children’s Society, in particular, did a lot of campaigning work alongside all the many practical projects it ran. It is perverse to put a limit on the amount that voluntary sector organisations can spend on campaigning in the run-up to a general election because that is when they can most effectively influence the political process, as that is when the political parties are writing their manifestos and when candidates are standing for election and re-election.

15:00

The late lamented Member for Wolverhampton South West, Rob Marris, told me always to read the explanatory memorandum, and paragraph 60 says this about clause 27:

“the full fees and costs in the 365 days before a UK general parliamentary election associated with any advertising, unsolicited material to electors, or manifestos, or with the organisation of any rallies or events, would count as controlled expenditure.”

I am assuming that Ministers think this is completely acceptable because we are going to live in a world of fixed-term Parliaments where there is no possibility of any Government ever collapsing before the end of the fixed term or any circumstance arising whereby a general election is held at another time, but the Minister must acknowledge that the reality is that we can never be certain of when there will be a general election. A voluntary sector organisation might make a calculation that it can run a campaign, only for the general election to be held six months earlier than scheduled for some reason, in which case all that expenditure will be caught. This is wholly unfair and completely unpredictable. I also hope the Minister will explain what the penalties will be for voluntary sector organisations that cut across these rules.

What is most worrying, however, is the wider implications for the voluntary sector. The right hon. Member for Haltemprice and Howden (Mr Davis) made it very clear that politics is changing and this is an attack on free speech in a civil society.

[Andrew Gwynne]

My hon. Friend is right to refer to the explanatory notes. One of the reasons why so many voluntary organisations are nervous about these provisions is outlined in paragraph 59:

“The definition of ‘for electoral purposes’ does not rely solely on the intent of the third party; the effect of the expenditure must also be considered.”

[Helen Goodman]

My hon. Friend is absolutely right, and I am grateful to him for reminding me of paragraph 59, because I, too, had underlined it. That makes the situation almost completely unpredictable for voluntary sector organisations.

[Tom Brake]

Is the hon. Lady saying these voluntary organisations are campaigning in support of a political party or for the election of a party candidate, because, of course, if they are not doing that, they are not covered by the controlled expenditure provision?

[Helen Goodman]

Yes, but that is the whole problem. They may not say, “Vote Liberal Democrat”, but if they say, “Don’t vote for candidates who voted for an increase in tuition fees,” everybody will be pretty clear what that means. The right hon. Gentleman’s party would be perfectly well able to go to court and say, “The effect of the expenditure must also be considered and it is clearly discriminatory against Liberal Democrat candidates.” That is the problem.

[Andrew Gwynne]

The sentence before the one I previously quoted mentions

“enhancing the standing of a registered political party or parties or candidates.”

In my hon. Friend’s opinion, would the Deputy Prime Minister’s pledging not to increase tuition fees on behalf of the National Union of Students have increased the electoral opportunities of that candidate in the 2010 general election?

[Helen Goodman]

My hon. Friend is pointing to the very serious practical problems that everybody—both the politicians standing for election and voluntary sector organisations—will face.

[Lady Hermon]

The intervention of the Deputy Leader of the House has, not for the first time today, added confusion. We are talking about clause 26, which states that “a course of conduct” could be covered if

“it does not involve any express mention being made of the name of any party or candidate.”

Therefore a charity that does not mention the name of a party or candidate could be covered.

[Helen Goodman]

That is right.

In the run-up to general elections, voluntary organisations often send e-mails and letters asking people where they stand on certain subjects, and after receiving the answers they send another message to their supporters saying, “Well, candidate X stands for what we want and candidate Y stands against it. If you think this is a big issue, we advise you to vote for candidate X, not candidate Y.”

[Stephen McPartland]

If a charity advises their supporters to vote for candidate X rather than candidate Y, that could affect the outcome of an election and it would therefore have to be included within regulated expenditure under current charity law.

[Helen Goodman]

That is a good point; I will concede that point to the hon. Gentleman.

[John Cryer]

What the hon. Member for Stevenage (Stephen McPartland) says is right, but over the past few days and weeks we have all been reading the briefings from charities and they are not saying “If we do this it is controlled expenditure, and if we do that, it is not.” The problem is the doubt, and that will be resolved in court cases that will probably run for years, unless this Bill is heavily amended, which we are expecting from the Government.

[Helen Goodman]

My hon. Friend is right. The problems of substance and process in the preparation of this Bill are numerous and inter-connected. People working in voluntary organisations are always annoyed that politicians of all stripes want to associate themselves with their good works but often want to ignore the hard messages they receive from those organisations. They want to ignore the lessons based on the wide range of practical experience the voluntary sector can bring to the table. This Bill is institutionalising cloth ears on the part of politicians.

It is ironic that part 2 of this Bill should come from this Government, because when the Conservatives were trying to get elected they were proclaiming the big society. Vladimir Putin would be proud to introduce this Bill.

[Caroline Lucas]

New clause 10, which stands in my name and those of the hon. Members for Nottingham North (Mr Allen) and for St Ives (Andrew George), would require the Government to carry out a proper assessment of the effect of third-party campaigning on UK elections, because I want to know what problem the Government think they are trying to fix. Alongside the rest of part 2, the changes made by clause 26 would silence legitimate campaigning voices in the run-up to elections. Equally alarmingly, Ministers are trying to push through this clampdown without a shred of evidence that there is a problem with third sector organisations exerting an undue influence over elections in the first place. As many hon. Members have said, the best way to proceed would be to ditch the whole of part 2 and only introduce changes for which there is a robust evidence base—one that would attract cross-party support—and which could take place after consultation with all organisations affected. That is what new clause 10 proposes.

Some people say that organisations such as 38 Degrees are scaremongering and that the Government’s concessions demonstrate that everything will be fine, but Ros Baston, a solicitor specialising in political and election law, told a number of MPs at a meeting that I hosted this morning that they would be advised to read the briefing from the Electoral Commission itself. Many hon. Members have already quoted from that, so I will not add to that. However, I would point hon. Members in the direction of Sir Stephen Bubb, the chief executive officer of the Association of Chief Executives of Voluntary Organisations, who says that even after these vague concessions have been promised

“the Bill remains fundamentally flawed. Our issue with it is not simply how it affects charities, but the fact it suggests they, and not other groups in society, are to blame for the public’s loss of trust in politics.”

He is very right in that assessment.

I strongly believe that there is a case for revisiting the current legislation, introduced by Labour in 2000 with the primary aim of preventing the emergence of US-style front groups working for particular candidates or parties, because the existing legislation has already been criticised for being heavy-handed in how it goes about achieving what is, of course, a laudable aim. As a result, some fiercely non-party political organisations are already saying that even the current rules have had some dampening effect on the freedom of charities and civil society organisations to campaign on policy issues—not for any political party or candidate—around the time of elections.

The crucial point must be to proceed on the basis not of hearsay but of a sound evidence base. It is right to examine the effect that third-party campaigning has had at elections in the UK and whether it has exerted undue influence over elections. It is also right to look at whether the activities of charities and civil society groups have harmed the public perception of the political system, as the Cabinet Office contends. But such a review must surely also look at whether the opposite is closer to the truth. It must ask whether existing rules are already too restrictive: do they make it unnecessarily difficult for the public to hear the opinions of those who might have different views from particular parties or candidates; are they imposing disproportionate limits on the ability of charities and others to engage in political and policy debate as one way of pursuing their charitable purposes; and are they preventing people from getting together to seek to influence the policies and positions of those who want to become their elected representatives?

[Andrew Gwynne]

Is that not the real point here: many of those charities and third-party organisations have engaged with the general public and brought them into the political processes in a way that all the political parties represented in Westminster have struggled to do in recent years?

[Caroline Lucas]

I thank the hon. Gentleman for his intervention, with which I agree wholeheartedly. I do not think that the main problem we have with our political system is over-participation; we need to be encouraging more people to participate, and that is exactly what is done by third-party organisations, such as the non-governmental organisations, the community groups—

[John Healey]

And the trade unions.

[Caroline Lucas]

Indeed.

The fundamental principle at issue today is the right of citizens to express their views and argue for or against a particular policy, and to do so by joining with others who share their concerns. It is that combination of the people who come together that we need to protect. We must not rush into changes that could make a bad situation worse when it comes to public engagement with the democratic process and elections. We need an even-handed and thorough review of the current rules. Like others, I am looking forward to seeing the details of the Government’s concession, but there is a real fear that even if their changes do what they claim they will, this Bill will still impose a dangerously anti-democratic chilling effect on legitimate voices seeking to raise awareness and stimulate debate on issues of crucial public interest, be it NHS reform, fuel poverty, housing policy or wildlife conservation.

15:15

As other hon. Members have said, charities already have to be non-political under charity law, and they do not need this extra layer of regulation. Other groups that do not operate as charities also play a crucial role in public debate, as do the trade unions. Such organisations include the World Development Movement, which campaigns on tackling the root causes of global poverty. Although that is surely an issue of cross-party concern, the WDM, like others, is fiercely independent from any political party.

If we change the meaning of “controlled expenditure” in a way that, alongside other measures, shuts down healthy public debate on policy proposals, we are sending a strong message to the public that, as Members of Parliament, we reject vigorous scrutiny of our policies and proposals, and we want to shut down challenges and silence those who disagree. The opposite should be true, particularly in the run-up to elections. I wish to quote briefly from comments made by the director of Green Alliance, an organisation with which many hon. Members work closely. He puts it clearly when he says that

“the Bill fundamentally misunderstands the difference between engaging in political debate and electioneering. It actively ignores the huge contribution that pressure groups and charities play in enriching democratic debate by raising public awareness, contributing to political thinking, and holding elected representatives to account. If it passes into law it will not only be harder for the public to hear the opinions of those that might have different views than the particular parties or candidates. It’s also very likely that avowedly party-neutral organisations will go quiet for fear of being in breach of the new Act.”

We should be seeking to encourage, not eradicate, debate, difficult as that may be at times. Such debate and challenge makes a positive contribution to accountability, policy making and public engagement in the political process itself. Too many people already feel turned off and disempowered when it comes to politics. Too many people feel that they do not really have an influence over the future of their neighbourhoods, their national Government or, indeed, international affairs. That is why I believe that the small concessions we are being offered this afternoon—or at least the promise of them some time in the future—are totally inadequate at this stage. We should absolutely reject clause 26. This Government once spoke about the big society, but we are seeing today a Government intent on smothering the big society and instead bringing forward a much smaller society, one that will be much less well-informed than it is today.

[Susan Elan Jones]

I rise to support the provisions tabled by my hon. Friend the Member for Caerphilly (Wayne David). I wonder whether today we are living through a real-life episode of “The West Wing”, “Borgen” or a unique British combination of the two. We had a newly elected, husky-driven, Prime Minister coming into power saying that lobbying was the next big scandal waiting to happen. We thought about all the elements that involved—the fact that people were concerned about elements of cash for questions and about big corporate donors who had meetings with people we knew not who—but we then discovered that the real villains were the Salvation Army, the Royal Society for the Protection of Birds, small charities such as those represented by the Association of Voluntary Organisations in Wrexham county and, horror of horrors, the Royal British Legion.

What was fundamentally bad about part 2 of the Bill to start off with was the fact that no consultation took place with the voluntary sector over the summer. I am appalled that we are undertaking our deliberations without hearing from witnesses who know all about the situation—those in the charities and voluntary organisations who have in-depth knowledge of how the Bill might affect them. A system of hearing from those bodies worked well for the Bill that became the Small Charitable Donations Act 2012 and it has been a mistake not to have an equivalent—however procedurally that would have been managed—for this Bill.

[Nia Griffith (Llanelli) (Lab)]

Does my hon. Friend recognise the irony that although many of these organisations have contributed massively to many other areas of legislation, on the very piece of legislation that will affect their ability to do that, they have not been consulted?

[Susan Elan Jones]

My hon. Friend could well write the episode of the soap opera that I was describing.

As a co-chair of the all-party group on civil society and volunteering, along with the hon. Member for St Ives (Andrew George) and Baroness Pitkeathley, I was delighted to see the voluntary sector speak up loudly on this issue—rightly so, given the attacks on civic society in this Bill. I know that many hon. Members have been deluged with e-mails, letters, telephone calls and requests for meetings about this. We know the NCVO’s serious concerns from its briefing, and it raised the specific point of how damaging it feels the legislation would be for expenditure thresholds and activities and how they relate to small charitable groups.

[Helen Goodman]

My hon. Friend is absolutely right about this. One thing voluntary groups do is use campaigns to raise their profiles so that they can raise funds to do more practical work. Their campaigning activities are part of all their work and it all fits together for them. The Bill will damage not only their ability to speak but, potentially, their ability to do some practical work.

[Susan Elan Jones]

That is absolutely right.

Many concerned voices were heard in last week’s debate and many thoughtful speeches, too, none more so than that of my hon. Friend the Member for Nottingham North (Mr Allen), who is Chair of the Political and Constitutional Reform Committee. I do not quite concur with one small aspect of his speech, however. He said that

“one of the most wonderful parts of my life experience as a Member of Parliament is when we come towards a general election, and all those different bodies start to get hold of us, lobby us, knock on our doors, phone us and send letters—‘Come to our meeting. You will not get our vote unless we know exactly what you are doing on this.’ Someone on the opposite side then says exactly the same thing”.—[Official Report, 3 September 2013; Vol. 567, c. 205.]

In truth, although at times such meetings will be bliss itself and will be meaningful, sometimes they will frustrate and annoy many Members and the Government—any Government. That is why it is correct that the right of such organisations to do this must be protected at all costs so that they can put forward their view unhindered, without being entangled in red tape, and can speak truth to power unhindered by the certainties of this Bill.

I wonder how the Bill would affect the pro and anti-HS2 lobbies, the campaign for digital hearing aids, the campaign for the rights of Gurkhas to settle in this country and some of the campaigns run by the Royal British Legion.

[Mark Lazarowicz]

Last week, 100 MPs were in the Chamber to take part in the “Get Britain Cycling” debate, in which Members from all parties said that we should attempt to get all the political parties to agree to that manifesto. Is that not a good example of exactly the kind of measure that could be hit by the Bill?

[Susan Elan Jones]

I agree totally.

I am sure that some Members will have read the beautiful article by the Royal British Legion’s director general Dr Simpkins in The Daily Telegraph last week, which told how:

“In 1921, a year before a General Election, The Royal British Legion successfully ran its first campaign, lobbying the Government to ensure that three-quarters of those employed on relief works were veterans of the First World War.”

Our tradition of charities being allowed to campaign on political issues germane to their charitable activities is at the heart of British life and our democracy. It has been established in case law since 1917, a year before universal male suffrage. Well before women had the vote, Lord Normand, in the case of Bowman v. Secular Society, held that a society whose predominant aim was not to change the law could be charitable when its campaign to change the law was merely a subsidiary activity. That tradition has a long pedigree in this country and I do not believe that it should be for tinkering politicians, perhaps fearful of the impact of Cameron and Clegg non-mania in 2015, to play with it.

[Angela Smith]

My hon. Friend is making a powerful argument in defence of the right of charities to engage in civil society. However, does she agree that we are up against it on this point? Only eight months ago, one contributor to “ConservativeHome” said:

“When exactly ARE we going to stop funding these so called ‘charities’…? For example, ‘Shelter’ do absolutely nothing to practically help the homeless. Their sole purpose is to lobby government to increase the funding for housing and homelessness. And for this, they are funded BY the government! Crazy!”

[Susan Elan Jones]

Happily, I am not responsible for what people write on “ConservativeHome.”

The Prime Minister once spoke the rhetoric of a big society and a coming together of hearts and minds, yet today we are sitting in this Chamber to discuss a Bill that could mean that a consortium of cancer charities has problems campaigning with realistic staffing levels whereas pro-tobacco lobbyist Lynton Crosby has nothing more to worry about than how much tobacco to put in his pipe. This remains a calamitous, bureaucratic Bill and should be replaced by one that deals with the villains of the piece and does not attack the voluntary sector.

[John McDonnell (Hayes and Harlington) (Lab)]

I just want simple answers to simple questions. I apologise for being absent from the debate, but I have been at a Delegated Legislation Committee.

When the Minister responds, may we have some clarity about the time scale for the amendments he is going to introduce? If the Report stage is to be on 8 October, it would be invaluable for Members to have them at least a week before so that we can consider them properly. It would also be useful if, in advance of the drafting discussions, the Minister could set out the general principles on which the amendments will be based. That will at least give us some early warning of what it is likely to look like.

[Mr Allen]

Does my hon. Friend also think that it is important that the people affected by the clause, who were not consulted on the original drafting, should also be engaged in the process so that any obvious mistakes can be corrected before the amendments come to us?

[John McDonnell]

That is my third point. If we are seeking to reach consensus, it is critical that all parties in this House are involved in those discussions and also that all parties outside the House that have expressed an interest or a concern are consulted. I am not happy with the whole process—I think we are procedurally in a mess.

[Wayne David]

My hon. Friend is absolutely right in what he is saying on consultation. It is important that the Electoral Commission is added to the list of consultees, because it has the expertise and is charged with the responsibility of implementing the Bill.

[John McDonnell]

Yes, that was my fourth point. We have to dig ourselves out of this procedural hole and try to ensure that we are not in the same wrangle when we come back on 8 October. It is important that the Electoral Commission is involved.

It would be invaluable if, once the amendment was drafted, the Select Committee had the opportunity to consider it in some detail. The Committee has built up expertise on the Bill over some time and the amendments it has proposed have meant that we have been able to have a proper and constructive debate.

[John Healey]

My hon. Friend is making a set of important points about process rather than principle, which is what he normally covers, and they are extremely valuable. Does he agree, in asking ask the Minister to set out the principles on which his proposed changes for introduction on Report will be based, that they should be principles for how he wants to change the status quo rather than how he wants to tinker with the Bill’s deeply flawed provisions?

[John McDonnell]

The reason I want some general principles set out is that I, like many others, am completely confused about where we are at—what the Government’s intentions are, and the implications of the Bill. I have spoken three times in the series of debates starting with Second Reading, so I do not want to repeat the arguments that I have advanced, but I think that people are genuinely confused. If we arrive in this place on 8 October without that full process, people will be equally confused, and either we shall be faced with a rush to pass bad legislation, or, if we have unfortunately failed to reach consensus, people outside this place will—let us put it this way—not hold us in the regard in which we should be held on something like this.

I make this plea to the Minister: at least get some clarity today before we move forward. It is fortuitous that we have the conference break; that gives us the opportunity to get that right and to be fully inclusive in the process from here on in.

[Nia Griffith]

I shall speak to amendments 62, 64 and 167 and new clause 9.

I feel that I am speaking in a bit of a vacuum. I can speak to what is already on paper, and I can speak to our amendments, but we have no idea what the Government will bring forward as an amendment, and it seems to me a very higgledy-piggledy way to deal with legislation.

The real issue, of course, is that there has not been any consultation. There has been no time for anyone to look at this in advance. I had the privilege yesterday of meeting a number of third-sector organisations in Cardiff—some Wales-only organisations, and some that also operate UK-wide but quite properly have offices in Cardiff or other parts of Wales, which facilitates their engagement with the National Assembly for Wales. It is extremely important to consult—even to speak today, I found it essential to consult, listen to and read a lot of the material that those groups have kindly produced in a very short time indeed.

15:30

There was utter disbelief and anger that the Government had made no attempt to consult the organisations. Those are organisations that feed in regularly, whether to legislation or to Select Committee inquiries. They often do enormous amounts of research, and they help us by providing useful facts and figures and giving evidence that we can often use. I think of organisations—perhaps the RSPB—that are well respected, have a wide remit and often operate across the political spectrum, perhaps uniting groups of people who might not otherwise meet, to campaign together on a specific issue.

The Welsh Assembly elections are an additional challenge for groups operating in Wales, because taking into consideration the period in which the legislation would apply—12 months before a general election, plus the few months before a Welsh Assembly election, plus the European elections—a rather large chunk of any five-year period is a no-go area, when those organisations cannot operate. The real shame is that many of those organisations are involved in policy formation. Some of the work that they do—their ideas and discussions—results in substantial contributions to policy. If any one party were then to adopt that policy, the whole of the legislation could then apply retrospectively to many of the activities that they had carried out, including the staff time to put that policy together.

Not only would those organisations be less inclined to get involved in the work that is so vital to us, but the net would be flung far wider and bring in far more organisations, some of which are user groups, local groups, that have far less experience of such activity. For many of them, it would be much more practical to provide clarification of existing Charity Commission law and Electoral Commission advice, so that—

[John Healey]

Does my hon. Friend agree that it is not just the great and the good of the charity sector—groups of the type that she has been talking to—that would be affected? Has she, like me and many other Members, been contacted by a lot of constituents who see very clearly the dangers to the democratic process—constituents like Dr Kathryn Horridge from Rawmarsh, who said:

“I support greater transparency and accountability in the political process, and would like to see the influence of ‘Big Money’ over politics reduced. I’d support a new law which genuinely did this, rather than a law which gags campaign groups but leaves Rupert Murdoch and millionaire party donors untouched”?

[Nia Griffith]

My right hon. Friend made that point extremely well. Many people’s first political engagement may come about when they join a campaign on an issue that they feel strongly about, and to curtail that would discourage participation when we all recognise that the real challenge today is to get more participation and enable more people to have a voice in our society.

Another issue that will hit people very hard is the reduction of the financial limit in Wales. That will be £2,000, and there will be a requirement to declare many additional costs, such as staffing costs.

[Jonathan Edwards (Carmarthen East and Dinefwr) (PC)]

Does the hon. Lady share my concern that, according to my reading of the Bill, the reduction in expenditure in Wales, Scotland and Northern Ireland is greater in proportional terms than the reduction in expenditure in England? Would she share her thoughts? Why does she think that the UK Government have brought this iniquitous proposal forward?

[Nia Griffith]

The hon. Gentleman makes a very good point. Of course, it makes it especially difficult when organisations are trying to influence policy both in the devolved Administrations and in the UK Government. So many areas overlap now. It can be big things such as climate change, which was mentioned earlier; it can be things like fuel poverty or it can be much smaller things, which are partly devolved, partly not. A lot of work is done by such groups in influencing both the devolved Administrations and more widely.

Many of these organisations also operate internationally and have international deadlines. I refer to the millennium development goals, the UN convention on the rights of the child and so on. Those organisations participate in worldwide activities whose timetable may fall within the wrong time in an election cycle and it may be more difficult for them to put forward their point of view. Some of them have even talked about making sure that some of their policies are dealt with in their overseas offices so that they are not caught by the Bill. There are a huge number of complications.

The other issue that particularly affects organisations operating in Wales, Scotland or Northern Ireland is that they are often in coalition with many other groups, some of which operate on a UK-wide basis and some of which operate only in Wales, Northern Ireland or Scotland. Accounting presents yet more complications, and they look with horror at the accounting detail that the Bill will require of them, which they will have to finance by paying someone to sort it out.

[Andrew Gwynne]

My hon. Friend is setting out perfectly the complexities arising from the Bill’s provisions. It will create not just an accounting minefield for those charities; it is potentially a legal minefield for them as well. Those charities and third-party organisations are fearful that if they fall foul of those provisions, they will end up in court.

[Nia Griffith]

Indeed, my hon. Friend makes a good point. Fear of legal action, doubt, not knowing and thinking that they could be involved in big legal costs are worrying those organisations and will effectively chill off any participation in a greater debate, which will be detrimental to our democracy in the long run. That is the key point about this part of the Bill. We would all like to see greater participation by people from all walks of life across the political spectrum.

[Dr Hywel Francis (Aberavon) (Lab)]

I thank my hon. Friend for allowing me to make this intervention and I apologise for not hearing the beginning of her speech. Does she agree that one of the side effects of the Bill is that it seriously undermines the devolution settlement? We have witnessed over the past 14 years the growth of democratic civil society in Scotland, Wales and Northern Ireland. Organisations that I am associated with, such as the Down’s Syndrome Association and Carers UK, greatly value the relationship that they have built up with the Welsh Government and the National Assembly for Wales.

[Nia Griffith]

Indeed. My hon. Friend makes a very good point. The worry is that the opportunity that those organisations have to feed into policy processes will be choked off. We have a good relationship, as my hon. Friend says, with many of those organisations, which contribute across the spectrum not only to the UK Government, the UK Parliament and some of our Select Committees, but to the devolved Administrations, and that will be choked off. People in our constituencies will become less engaged, as we heard.

[Lady Hermon]

An important point was made in an earlier intervention, to which the Deputy Leader of the House should pay attention. I am not saying that he has not paid entire attention to every remark made this afternoon; I am sure he has. I refer to the fear that charities have about criminal offences being committed. They will not know about being in breach of the legislation until after the event. It is imperative that the Government write into the Bill that any new criminal offences created by it, particularly in parts 1 and 2, will not have retrospective effect. That is essential, otherwise the Secretary of State could not sign the section 19 notice stating that it is compliant with the European convention on human rights.

[Nia Griffith]

Indeed. The hon. Lady makes a very good point on that issue, as did the right hon. Member for Haltemprice and Howden (Mr Davis). The key thing now is to move forward and get things right. I hope that, whatever the Government intend to bring forward for the next stage of the Bill, a proper consultation will take place. We would much rather see the whole thing scrapped so that we could start again, but if we are not going to get that, let us have the whole provision rewritten, with time for people to consider it, consult and come back with comments so that we can achieve a measure that is workable. As it stands, the proposal would be a disaster if it went through because it would curtail the very thing that we want to happen—greater engagement in our democracy.

[John Cryer]

I will start by welcoming back my hon. Friend the Member for Hayes and Harlington (John McDonnell)—this is the first time I have been able to take part in a debate with him since his return. He is one of the most dogged, tenacious and conscientious MPs I have ever met. I am sure that Comrades Cameron and Clegg will have cracked open the bubbly in Downing street when they realised he had returned.

It is worth reminding the Committee that constitutional Bills have previously always been taken without any kind of timetabling or guillotining. The Bill is clearly constitutional, yet it has been very tightly timetabled. Indeed, some might say that it is being rammed through extremely quickly. There are certain specific questions that I would like the Deputy Leader of the House to respond to when he gets to his feet, to do with how the Bill will affect charities and campaigning organisations.

Hope not Hate, for example—I assume that most of us are familiar with it—campaigns with politicians of all democratic parties across England, Scotland and Wales. What if 12 months before a general election it issued a leaflet or organised a campaign that happened to mention that a certain candidate was or had been a member of the British National party? Would that be caught by the legislation, or will the Deputy Leader of the House tell us that that will be open to interpretation by the courts and judges? Would that count when it comes to the measures in the Bill that control expenditure of a political nature?

What if Hope not Hate had a campaign against the English Defence League? It could be argued that the EDL is not a properly constituted political party, but it has a political wing, the Freedom party, which could take Hope not Hate to court. It could say that such a campaign counted towards election expenditure because it could affect a parliamentary election result achieved by the Freedom party as the political wing of the EDL.

What about local hospital campaigns? The recent Save Lewisham Hospital campaign has caught the public imagination and at least three hon. Friends have been involved. What if the campaign took place within 12 months of a general election? It could easily be argued that that could materially influence an election outcome, perhaps in the borough where the hospital is situated or further afield in south or east London. The campaign to save King George hospital ran through a number of Parliaments, so it ran through a number of 12-month periods before general elections. It could be argued that it influenced the electoral outcome in certain parliamentary constituencies.

The Defend Council Housing group campaigns in various areas, and against both major parties. When the Labour party was in government, the group engaged in a number of campaigns that were very critical of the Government, and since the general election the same thing has happened with the coalition. Again, it could be argued that that might be caught by the legislation.

[Jenny Chapman (Darlington) (Lab)]

Did my hon. Friend not hear the Leader of the House say on Second Reading that he had met senior charity chief officers—the National Council for Voluntary Organisations, I think—and that they were assured and content with the Bill? Does he not take the Leader of the House at his word?

[John Cryer]

No, I do not, funnily enough. I am not sure whether my hon. Friend was in her place, but earlier I referred to legal advice given to the NCVO by Helen Mountfield QC that made it clear that the problem is not that the definition of political campaigning has been redefined, but that it will be left wide open to interpretation. That will then lead, as sure as eggs is eggs, to court cases that could rumble on for years and lead to people being imprisoned.

[Andrew Gwynne]

My hon. Friend has hit on an issue. The explanatory notes make it clear that if a third party enhances a candidate’s standing, regardless of whether that is its intention or not, it will be covered by the Bill. Is that not the problem that my hon. Friend has pointed out by using the example of Defend Council Housing? If a candidate has a particular view on the issue of social housing, the campaign group’s expenditure will be captured by the provisions.

15:45

[John Cryer]

That goes to the heart of the problem in part 2 of the Bill, which has been hastily cobbled together over the past few weeks. I presume that is why the Government have tabled amendments to try to sort out the situation and redeem themselves in the eyes of a lot of charities, non-governmental organisations and others up and down the country.

[Fiona O'Donnell (East Lothian) (Lab)]

I apologise, Mr Sheridan, for not having been present for the whole debate. Does my hon. Friend agree that the concerns are not just about localised campaigns, but about UK-wide campaigns and the difficulties facing charities in different parts of the UK in calculating whether they will have crossed the threshold, given that they will have no way of judging the impact of campaigns conducted via websites and e-mail on different parts of the country?

[John Cryer]

I agree with my hon. Friend. One of the reasons I mentioned Hope not Hate is that it is a classic example of an organisation that conducts not only national but local campaigns in specific constituencies, boroughs and districts. According to Hope not Hate, with which I and many Members from all parties have done a lot of work in the past, its spending in the run-up to the next election will be cut by 70%. It also calculates, accurately, that its limit per constituency over the same period will be about £9,000. That will have a material effect on anti-racist campaigning in the run-up to the next election. As I have said, Hope not Hate campaigns with all democratic parties, not just one or two.

I cannot help thinking that part 2 is not entirely divorced from the fact that one or two Liberal Democrat MPs will be facing potentially strenuous campaigns by the National Union of Students in the run-up to the next election. One Member who springs to mind is the Deputy Prime Minister. For those who do not know Sheffield that well, I point out that his constituency is surrounded by a sea of student accommodation for a large university. I suspect that the Deputy Prime Minister is a little bit worried that the student voices that were sympathetic to the Liberal Democrats at the last election will now be saying, “Well, hang on a minute: the leader of the Liberal Democratic party stood on a specific pledge of not raising tuition fees, but he went back on it and voted for, and actually helped introduce, legislation that tripled tuition fees.” I do not think that that was a million miles away from his mind when he was considering part 2 of this Bill, and I think that is why it is receiving enthusiastic support from not all but certain Liberal Democrat Members.

I will finish with a couple of quotes that successfully set out the problem with part 2. First, the Royal British Legion, which is not particularly known for being a wild-eyed, left-wing organisation of agitators, has said—Members have probably seen the briefing paper—that the definition of “for election purposes” is “far too broad”.

Secondly, Karl Wilding from the NCVO, which my hon. Friend the Member for Darlington (Jenny Chapman) mentioned earlier, said only a couple of weeks ago:

“The Bill takes us from a situation in which everyone understands the rules on what charities can do and considers them reasonable, into a position where no one has any idea what the rules are, but could nevertheless face criminal prosecution for getting them wrong. This is what happens when legislation is rushed through with no consultation.”

I rest my case.

[Paul Flynn]

I am grateful, Mr Sheridan, to be called to speak in this debate for the first time in three days. That might have something to do with the fact that by the time I get fully to my feet the selected speaker is about to end their first sentence.

I am very glad that I am at this historic event, because I am sure that one day someone will write a book called “The Worst Legislative Atrocities”, which will of course include the Dangerous Dogs Act 1991. It will also include the Regulatory Reform Act 2001—initially a Bill so incomprehensible that in 2004 another Bill had to be introduced to explain what it meant. It will include many of the 75 Bills introduced by the previous Government that went through all their stages but, sadly, were never implemented. After all the efforts made by Parliament, in this House and the other place, to progress those Bills, they never went through. I believe that this mean, miserable Bill will also be seen as one of those Bills that demean the House and demean politics.

[Dr Francis]

I apologise for not being here at the beginning of the debate. I have just come from the Joint Committee on Human Rights, which I chair. I congratulate the Political and Constitutional Reform Committee on the great work that it has done; my hon. Friend is a member and its Chair is in his place. My Committee was seriously critical of the Government’s refusal to allow any pre-legislative scrutiny. One of the points made was that this has been a terrible waste of human resources—Members and staff alike.

[Paul Flynn]

My hon. Friend is absolutely right.

We are engaged in a comedy, a Machiavellian game where the Government are saying, “We are going to put this right. We are taking things out of the Bill, but not until October.” In the meantime, we can ventilate here and grind the air with our words, but it is all to no avail because the Government have deliberately put the charities provision in part 2 in order to withdraw it at a later stage. They know about all the e-mails that are coming through. They know that all that indignation and anger will be ventilated here and we will ignore the main lacuna in the Bill regarding the big scandal identified by the Prime Minister that he said was certain to come. We remember his words: “Everyone knows what I’m talking about.”

This is about lobbying. We know how it works—the lunches, the hospitality, the quiet word in the ear, the ex-Ministers and ex-advisers for hire, helping big business to find the right way to get its way in the Conservative party. The Conservatives say, “We believe in competition, not crony capitalism.” Oh no they don’t. The crony capitalism endemic in the soul of the party is shown in the fact that those who have the deepest pockets can get the access and the influence. That is what is in the party and that is what it has failed to address. We have been taken in. All the attention on this Bill is focused on the attacks on lobbying by charities. Who has said that the main scandal in future will be the dreadful activities of the Royal British Legion, Save the Children and Oxfam? It is a non-issue that the Government have inserted in an attempt to distract us from the main problem with the Bill.

In the previous Parliament, I had the advantage of serving on the Committee that dealt with lobbying. Sadly, the report that we put out in 2005 was not acted on. In all the time since then, we have had terrible examples of the abuse of our Parliament and our system by lobbyists. When are we going to have a look at what happened with the previous Defence Secretary, who acquired absolution when he resigned from his job? We did not have an inquiry into the ministerial adviser who also resigned. We did not have any exposure of what Mr Adam Werritty was doing. What was he up to? Who employed him?

[The Temporary Chairman (Jim Sheridan)]

Order. I know that the hon. Gentleman has waited a long time to speak in this debate, but it would be helpful if he could limit his contribution to clause 26.

[Paul Flynn]

I was speaking to the clause and amendment 47, which is a sensible way of considering the Bill. I might be tempted to go into a Second Reading speech, which I should not do. I believe that if we continue to address a non-issue in the Bill, we will intensify the lack of trust in this Committee and this Chamber. That issue is what the Prime Minister spoke so eloquently about before he was elected.

We are failing to do our job as members of the Committee, and handing over a mess of a Bill to the other House to correct and knock into shape. I appeal to the Minister to tell us in his winding-up speech what he will do on Report. Are we wasting our time attacking a non-problem in the Bill? Are we doing what he wants us to do, which is catch the minnows in the shallow waters while the great big salmon swim by unhindered?

[Mr Charles Walker (Broxbourne) (Con)]

I have listened carefully to a number of contributions, and genuine concerns have been expressed. I do a huge amount of work with Mind and Rethink on mental health, and with my 100% support and advice, in the run-up to the next general election they will be setting a number of challenges for the main political parties about how people with mental health problems are treated. They will be seeking positive responses to those challenges, and I need categorical assurance from the Minister and those on the Front Benches that such activities will not be caught by the Bill before us.

[Angela Smith (Penistone and Stocksbridge) (Lab)]

To add to that point, does the hon. Gentleman think that MPs’ websites with links to charities might find themselves included in a charity’s costs if they are considered to be promoting a particular charity’s position in the run-up to an election?

[Mr Walker]

The hon. Lady makes a constructive intervention, and no doubt the Minister will want to respond. Political engagement at whatever level in almost every form is greatly to be encouraged. I hope that the Government listen to the real concerns expressed today, and that that level of engagement is not suppressed.

[Tom Brake]

I thank the Chair of the Procedure Committee for his contribution to the debate, and I acknowledge the excellent work he does on behalf of mental health charities. I assure him that mental health charities that campaign on policy issues will not be affected by what we are debating today. I hope he will agree, however, that if during a general election campaign one of the charities he has referred to advocated support for a party or a number of candidates, that would, in effect, constitute electioneering and have to be accounted for.

[Mr Walker]

I hear what the Minister says, but I think it is acceptable for a mental health charity to advise its members to consider carefully the responses it has received from the candidates it has quizzed when it comes to deciding how to cast their vote.

[Mr Allen]

My Committee reported in order to inform debates such as this, and we took evidence on this very issue from the Electoral Commission. The definition of “election purposes” changes and it now includes “enhancing the standing” of candidates. The Electoral Commission said:

“The new definition has been framed in a way that leaves a great deal of scope for us to interpret the meaning of the legislation, subject to being over-ruled by the courts as the result of a challenge. This effectively gives the Electoral Commission a wide discretion in deciding what the new regime means in practice…we do not think it is appropriate for us to have the sort of wide discretion over the meaning and scope of the regulatory regime that the Bill as drafted appears to provide.”

That is not my view or that of any member of my Committee. That is the view of the impartial and objective Electoral Commission. If it does not know, no trustee or person active in a charity can know at this moment.

15:59

[Mr Walker]

I intend to follow the Bill closely. I hope that any charity worth its salt would not direct its members towards the candidate of a particular political party. I hope charities simply ask their members to take into consideration the responses they have received from the various candidates.

[Andrew Gwynne]

Will the hon. Gentleman give way?

[Mr Walker]

I will give way for a final time before I conclude my speech.

[Andrew Gwynne]

The hon. Gentleman’s point is precisely right, as hon. Members would expect, but does he share the concerns outlined by the Chair of the Political and Constitutional Reform Committee? The explanatory notes do not mention supporting candidates; they mention

“enhancing the standing of…candidates”,

which is open to interpretation.

[Mr Walker]

I share many of the concerns expressed in the Chamber this afternoon, which is why I, like all hon. Members, will listen closely to the Minister’s response.

[Wayne David]

rose—

[The Temporary Chair (Jim Sheridan)]

Order. Before I call the Minister, the Opposition spokesperson has indicated that he wishes to make some brief comments.

[Wayne David]

It is unusual for the Opposition spokesman to make a second speech in such a debate, but it is important to hone in on a few points that have been made on both sides of the Committee. There is a high degree of consensus, and very few, if any, hon. Members have made partisan contributions. All recognise the value of civil society and of it engaging fully in our democratic process.

The right hon. Member for Haltemprice and Howden (Mr Davis) spoke of how the nature of society is changing, and of how civil society is becoming more important in our democracy. We should recognise that and enhance such involvement. We have also heard how public policy is extremely important, particularly with regard to the devolved institutions, for campaigning organisations and the voluntary sector. Hon. Members have heard how charities do not simply raise money, but have a great deal of input into the development of policy in their respective areas, so public policy formation and charity work come together.

In my view, all those points have produced a unanimous view in the Committee. It is important that the Minister acknowledges the relatively uniformity of view in the Committee, and recognises the need for more discussion among hon. Members, and perhaps more importantly among those outside the Chamber who will be directly affected, including the Electoral Commission, charities and campaigning organisations.

Hon. Members have honed in on clause 26. I heard what the Deputy Leader of the House said at the beginning of the debate about amending the clause and schedule 3, so I ask him, in the next few minutes, to give the Committee a commitment that he will have a dialogue with the Opposition, the Electoral Commission and all the organisations that are concerned about the implementation of the measures.

This positive debate has shown that the Committee is not against change. All hon. Members recognise that change must take place, but we also recognise that, in a democracy, if change is to enhance our democratic process, it must take place on the basis of consensus and agreement.

[Tom Brake]

I apologise for the fact that I will take some time to respond. We have been debating the matter for two or two and half hours, and it is appropriate for me to respond to many of the points that have been made. If I am unable to respond in the debate to the points hon. Members have made, or if I do not respond, they can take them up with me later and I will respond in writing.

The debate on Second Reading raised a number of important issues relating to clause 26, and I am grateful to my hon. Friend the Member for Caithness, Sutherland and Easter Ross (John Thurso) and the hon. Members for Caerphilly (Wayne David), for Nottingham North (Mr Allen), for Perth and North Perthshire (Pete Wishart) and for Banff and Buchan (Dr Whiteford) for the amendments they have tabled.

The hon. Member for Caerphilly criticised the Government by saying that the Bill was rushed, but then invited me to draft the amendment we had been discussing here and now, thereby short-circuiting any discussion with interested parties on that particular issue. In response to the specific request he and the hon. Member for Hayes and Harlington (John McDonnell) made on when an amendment will be tabled and whether there will be a process for engaging with the Opposition, the Electoral Commission and the National Council for Voluntary Organisations, I can provide them with reassurance that that process will happen. I am happy to meet the hon. Member for Caerphilly to discuss proposed Government amendments. Discussions will take place with the Electoral Commission and the NCVO prior to them being finalised. Although the House will be in conference recess, the Government hope to table amendments at least a week before to give Members time to consider them.

[Wayne David]

I thank the right hon. Gentleman for his positive comment. If he is giving a commitment to effectively redrafting clause 26, he will have no problem if the Committee votes against it tonight.

[Tom Brake]

It will be up to the hon. Gentleman to make his decision. I have given an undertaking, and am about to give a more detailed undertaking, of what we intend to do with clause 26. It will be up to him to decide whether he feels that that is appropriate.

The main purpose of clause 26 is to align the activities that count as controlled expenditure for political parties and third parties. Many Members have referred to the Electoral Commission’s objections to aspects of the Bill. As far as I am aware, no one has referred to what it had to say on the alignment of the definition of controlled expenditure for political parties and third parties, and I would like to put that on the record. Recommendation 29 of its June 2013 report states:

“The rules on PPERA non-party campaigning that is intended to influence voters should be changed so that they more closely reflect the scope of rules for political parties by covering events, media work and polling, as well as election material.”

That is what the Electoral Commission has to say about the importance of ensuring that the two measures mesh carefully.

[Wayne David]

rose—

[Mr Allen]

rose—

[Tom Brake]

I will give way to the Opposition Front Bench spokesman and then the Chair of the Select Committee.

[Wayne David]

What the right hon. Gentleman says is of course correct. Why, if he believes there should be greater alignment between the two areas of expenditure, does he want to introduce a staff cost to the voluntary sector that does not apply to political parties? He cannot have it both ways.

[Tom Brake]

I thank the hon. Gentleman for that intervention, because it gives me the opportunity to underline that under the current definition of controlled expenditure, staff costs for non-party organisations have to be accounted for. This is not a departure; we are extending the requirement on them to account for staff costs to the new areas of controlled expenditure that we think should be covered, such as research.

[Mr Allen]

The Deputy Leader of the House is absolutely right that the Electoral Commission says those words. My Select Committee read a little further than the right hon. Gentleman, and it is in our report for any Member to read. It says:

“However, crucially, they”—

the Electoral Commission—

“added: ‘this would need careful consideration’. This careful consideration appears to have been lacking.”

[Tom Brake]

I thank the Select Committee Chair for that further clarification of the Electoral Commission’s quote. What we are doing to bring these two measures of controlled expenditure in line is careful and considered. We may, if we have time, come to clause 27. I suspect that we may debate other aspects later.

[Dr Francis]

The Minister talks about careful consideration. Will he produce a human rights memorandum on the Bill and will he allow my Committee, the Joint Committee on Human Rights, to produce a report? We only began to deal with this report today and we hope to report sometime in October. Will he allow us the opportunity to present that report to the House and for him to consider it?

[Tom Brake]

On the human rights aspects, some Members have questioned whether the Bill is compliant. The Government’s assessment is that we consider all the spending limits in the Bill to be compatible with article 10 and have taken into account the amount that the third parties are permitted to spend under the reduced limits and the amount that they spend now. Clearly this has been given active consideration by the Government, as the hon. Gentleman would expect.

The main purpose of clause 26 is to align the activities that count as controlled expenditure for political parties and third parties. At present, the activities that count as controlled expenditure depend on whether we are referring to a political party or a third party. This means that spending by recognised third parties to assist a political party with the cost of an event would be captured as political party spending. However, if the recognised third party were independently to organise such an event itself—perhaps supporting that same party—such spending would not be caught. That highlights why we are trying to ensure that these two definitions—for third parties and for political parties—are brought into line.

We agree with the Electoral Commission that the current variation in what constitutes controlled expenditure for a political party and for a recognised third party is a potential gap in the regulation of spending in the UK elections, hence the intention behind clause 26. I believe that aligning the definition of controlled expenditure is a reasonable and sensible measure. However, to achieve this, the current definition of election materials needs to be revised. [Interruption.] I hope Members will let me finish what I am saying before trying to intervene. At present, recognised third parties incur controlled expenditure in connection with the production or publication of election material that is made available to the public. As a result, the Bill proposes to replace “election materials” with “for election purposes”; as we are aligning the activities with those of parties, we are also aligning the language of the test.

As we have said, the Government do not believe that we are significantly changing or widening the present test. Controlled expenditure would be incurred only where an organisation is promoting or procuring the electoral success of a party or candidate. However, I am conscious, as are the Government, of the concerns raised by right hon. and hon. Members that charities and voluntary organisations will be caught by the proposals in clause 26 and that the new language leaves room for ambiguity. This is not the Government’s intention.

[John Mann (Bassetlaw) (Lab)]

Will the Minister confirm that what he and the Government are proposing is that if a charity puts out a leaflet saying “Vote for people in favour of animal welfare”—I have voted recently in favour of animal welfare—and if, as happened at the last election in Bassetlaw, the Conservative party unwisely and unsuccessfully spends £250,000 sending direct mails to my electorate with pictures of some southern politician, the Conservative party will be able to do that but the charity will not?

[Tom Brake]

On the latter point, the hon. Gentleman will be aware that the political parties have sought to get an agreement on party political funding and that that was not possible. He can speculate on where the blockage for that was. On the question of the charity, I can assure him that if his charity campaigned in the run-up to the 2010 general election, we will ensure that it has the same level of clarity about what and how it can campaign as it did then. I hope that he will acknowledge that some of the concerns expressed today about the uncertainties for charities about what they can and cannot do exist under the present legislation. Those charities already have discussions with the Charity Commission and the Electoral Commission, under the present legislation, about what they can and cannot do

16:14

[John Mann]

So to confirm, the right hon. Gentleman is saying that the Conservative party could spend that money, which was wasted in Bassetlaw—or, indeed, it could spend it against him, very personally and directly—but that if a charity campaigned on how he or I voted, and if it persuaded us in the year running up to an election and then used its resources to e-mail its supporters or members, who then e-mailed us to congratulate us on how we voted, it could be caught out by the law.

[Tom Brake]

We could continue this rather unfruitful dialogue, or I can restate that, whatever the charity to which the hon. Gentleman refers did in the run-up to the 2010 general election, we will ensure the same clarity about what it can do in the run-up to the 2015 general election, and there would be no difference.

[Mr David Anderson (Blaydon) (Lab)]

rose—

[Mark Durkan (Foyle) (SDLP)]

rose—

[Tracey Crouch]

rose—

[Tom Brake]

I am going to make a bit more progress. It may help the Committee—

[Several hon. Members]

rose—

[The Temporary Chair (Sir Edward Leigh)]

Order. The Minister is not giving way at this point. Hon. Members must let him continue.

[Tom Brake]

I will give way shortly.

It might help the Committee if I set out in a little detail why the amendments in this group would not work effectively, along with some of the points we will need to address before Report. I thank my hon. Friend the Member for Caithness, Sutherland and Easter Ross for his amendments, which in substance try to achieve what the Government want to do. However, in practice, there are some deficiencies in their wording, which means that we cannot simply adopt them now.

[Tracey Crouch]

It is quite clear from today’s discussions that there is still some confusion among charities and third sector organisations about some of the wording in the Bill. I am pleased to hear that the Minister is willing to reconsider the precise wording, but when he does, will he bear in mind the fact that other organisations are also concerned about the impact of the Bill? They include the excellent Liberal Democrat Voice, LabourList and ConservativeHome, which are equally unclear about whether part 2 applies to what they do.

[Tom Brake]

When the amendment is made public—we have made a commitment to do that—I am sure that those organisations will be effective at lobbying us, and no doubt 38 Degrees will also want to communicate its views. We will be informed about whether the different organisations consider our amendment to be sufficient to achieve what they are requesting.

[Mr Anderson]

rose—

[Tom Brake]

I am going to make some more progress.

The amendments tabled by my hon. Friend the Member for Caithness, Sutherland and Easter Ross would alter clause 26, so that a third party would incur controlled expenditure only when it undertook activities that fall within part 1 of proposed schedule 8A to the Political Parties, Elections and Referendums Act 2000, as set out in schedule 3 to the Bill, and are incurred “for election purposes”. It would also remove the definition of “for election purposes”, which means that “for election purposes” would be undefined in the legislation. I can see that the objective of the amendments is to maintain the expanded list of activities that would count as controlled expenditure, but to revert to the existing definition, as used for “election materials”.

The amendments tabled by the hon. Member for Caerphilly seek to reinstate the current legislative arrangements. Recognised third parties would incur controlled expenditure only for “election materials” and only for certain activities, such as advertising and unsolicited materials addressed to electors. The Government believe that aligning the activities for which political parties and recognised third parties incur controlled expenditure is a sensible and reasonable objective. As I have said, this measure is advocated and supported by the Electoral Commission.

The hon. Member for Leyton and Wanstead (John Cryer) referred to Hope not Hate. I agree with him that many of the things that people have said today will result from the Bill will simply not happen. However, given that Hope not Hate spent above the cap proposed by the Government, its spending would be constrained, so he touched on a genuine point. I will be meeting Hope not Hate to see whether we can address the concerns it might have. With organisations such as 38 Degrees and Hope not Hate increasingly switching to online campaigning activity, the costs of campaigning could go down, as it is much cheaper to campaign online via e-mail than by using postal mailshots. I will meet that organisation to discuss the matter in any case.

There is a potential gap in the regulatory regime when a recognised third party that undertakes public rallies and media events would only incur spending on election material made available to the public, whereas if that were done on behalf of a political party, the cost of the full range of activities would be captured. This objective should not be lost in the wider discussion relating to charities and voluntary organisations.

A further amendment tabled by the hon. Member for Caerphilly seeks to amend the definition of “election purposes” so that controlled expenditure would be incurred only by a recognised third party when it was its direct purpose. It is useful to highlight to the Committee that, under the currently regulatory regime, the test for “electoral materials” has a subjective and an objective element.

[John Mann]

Given what the Minister has just said, will he confirm that if a church or a synagogue were to organise an election hustings but chose explicitly to exclude a fascist candidate, that would be deemed to constitute electioneering against that candidate and would fall entirely within the remit of the Bill?

[Tom Brake]

That is the kind of issue that can be taken up with the Charity Commission and the Electoral Commission under existing legislation to establish whether that particular activity constituted electioneering. Nothing that we are proposing would affect that.

The amendments tabled by the hon. Member for Nottingham North seek, as previous amendments have done, to strike a balance between the reasonable intent of expanding the range of activities that incur controlled expenditure, and addressing concerns over the activities of charities and voluntary organisations being caught. Amendment 131 seeks to revise the definition of “for election purposes” as activity that can reasonably be regarded as promoting or procuring the success of a party or candidate. As the Government have indicated, we support the principle of that aim, and we will table amendments on Report which I hope will address that concern to the hon. Gentleman’s satisfaction.

A further amendment tabled by the hon. Gentleman proposes that donations by a third party to a third party coalition group should count towards the donor third party’s spending limits. That seems to suggest that such a grouping would register as a separate, new third party and be subject to the wider controls of the Political Parties, Elections and Referendums Act 2000. The intention appears to be to repeal section 94(6) of PPERA. That provision stipulates that when two or more third parties work together as a group or coalition in pursuance of a common plan, the whole of the expenditure they incur as part of that coalition must count against each third party’s spending limit separately. However, the drafting of the amendment would not explicitly repeal section 94(6). The amendment also fails to consider that removing the existing provisions on acting in concert would remove a key anti-avoidance measure from PPERA. If total spending by a group of third parties acting as part of a common plan was not counted in full against each individual third party’s limits, it would allow third parties to form many coalitions on single issues in order to evade their spending limits. That would remove a vital safeguard from the integrity of the rules.

[Angela Smith]

Has the Minister considered the position of the Wildlife Trust in this context? It is not a single organisation but a coalition of trusts working up and down the country; it is a coalition of organisations working as a single body.

[Tom Brake]

Clearly we have. This comes down to the issue of whether the Wildlife Trust, which I suspect has members drawn from all parties and none, would as part of that coalition campaign in support of a political party or of a number of party candidates. If it did not intend to do so, it would not be covered by the legislation.

[Mr Allen]

In respect of the amendment I tabled in line with the sentiment of my Select Committee—very much along the lines of the amendment tabled by the hon. Member for Caithness, Sutherland and Easter Ross (John Thurso)—I am receiving reassurances from what the Minister said, so I am happy not press it to a Division. We all look forward to seeing the actual words that will give life to both those amendments.

[Tom Brake]

I thank the hon. Gentleman for that clarification. I shall move on to other amendments, but I want to take the opportunity to reassure him that we would seek to engage with him on the amendment we propose to table on Report.

[Paul Flynn]

Is it the message of the right hon. Gentleman’s speech that all the organisations and charities that are campaigning against the Bill should now intensify their campaigns until October in order to get something sensible from the Government on Report?

[Tom Brake]

Far be it from me to encourage or advise charities. I am sure they will continue to campaign if they feel there is a need, but my hope and expectation is that, once the NCVO and other organisations have seen the amendment that we intend to publish to address their concerns about a lack of clarity on the definitions, they will be satisfied. They might not be satisfied on other elements, but we will wait and see how they respond.

The amendment tabled by the hon. Member for Perth and North Perthshire would exclude the part 2 provisions from applying to elections to the Scottish Parliament without the assent of the Scottish Parliament. A number of Members have commented on the Bill’s impact on the different Administrations, so perhaps I need to clarify the issue. For the most part, the Bill is focused on UK parliamentary elections, and many of the provisions will have no effect on elections to the Scottish Parliament. Spending controls operate by regulated period, rather than by election, so seeking to exclude Scottish Parliament election spending in those areas where there are common rules would create an unworkable situation. For those reasons and others, these matters are reserved.

The amendment tabled by the hon. Member for Banff and Buchan would exclude charities registered in the Scottish charity register. The Electoral Commission has highlighted in its amendment briefing that, as a general point, it does not see a case for charities to be exempt from the rules regulating third parties, and the Government agree.

[Dr Whiteford]

Will the Minister outline exactly what discussions he has had with the devolved Administrations about this Bill in Scotland, Wales and Northern Ireland? What discussions has he had with the charity commissions that regulate charities in Scotland, Wales and Northern Ireland?

[Tom Brake]

I am afraid I will have to write to the hon. Lady. She will be able to judge for herself whether she feels that the response is suitable.

The hon. Member for North Down (Lady Hermon) intervened on the hon. Member for Banff and Buchan and referred to future elections “imminent or otherwise”. I would like to clarify that that is an existing definition under PPERA, not something new that the Bill would introduce.

[Lady Hermon]

The Minister mentioned me, so I appreciate his giving me the opportunity to say that the Bill amends existing legislation, specifically the Political Parties, Elections and Referendums Act 2000. That is what we are discussing. The fact that a term already exists in legislation does not make it good. I would like him to explain what is meant by a future election being “(imminent or otherwise)”. It is in that Act. What does it actually mean?

[Tom Brake]

I can assure the hon. Lady that, given that this term has been in legislation since 2000, it must be completely clear. I am going to move on.

My right hon. Friend the Leader of the House and I have met representatives of the voluntary sector to hear their concerns first hand. I can assure my hon. Friend the Member for Caithness, Sutherland and Easter Ross and the hon. Members for Caerphilly, for Nottingham North, for Perth and North Perthshire and for Banff and Buchan that we will look closely at the drafting of the clause so that it is absolutely clear that we are not changing the current test. I apologise for repeating that. It must be the third, fourth or fifth time I have said it today, but I think it is important to make it clear to everybody what we are seeking to do. We believe that that would most simply be achieved, and the greatest reassurance would be given to campaigners and to the Electoral Commission, by a reversion to the situation set out by existing legislation, which defines controlled expenditure as expenditure

“which can reasonably be regarded as intended to promote or procure electoral success”.

[Interruption.] I hear one of the Opposition spokesmen say that this is a shambles. I hoped to hear from him that it was, in fact, a case of the Government’s listening to the concerns expressed by charities and by Members on both sides of the House, and responding to them.

16:30

[Wayne David]

rose—

[Tom Brake]

I will give way to the Opposition spokesman, but I will not take any more interventions after that.

[Wayne David]

I thought that the Minister was in listening mode, but there we are. May I ask him one simple question? Does he intend to revise schedule 3?

[Tom Brake]

I think that we shall have to wait and see—[Interruption.] As I have said to the hon. Gentleman, what we are seeking to do is to address the concerns expressed by charities about the lack of clarity in the definitions. We have indicated that we will revert to terms very similar to those used in the original legislation. I am sure that if he genuinely wants to address the concerns that charities have expressed, he will welcome that. As I said, we will return to the issue on Report.

In new clause 9, the hon. Member for Caerphilly calls on the Government to undertake a post-legislative assessment. New clause 10 also calls for such an assessment. We conducted an impact assessment, which we consider to be adequate, but the Chairman of the Select Committee, the hon. Member for Nottingham North, may well wish to undertake a post-legislative assessment. The Leader of the House and I are both keen for post-legislative scrutiny to take place, and, in fact, would encourage Select Committees to carry out more of it than they do at present.

The hon. Member for Caerphilly referred to the amendment which would alter schedule 3 by appearing to narrow slightly the types of manifesto or documents that are included, omitting those which set out a party’s policies, but not the third party’s view of them. It would also remove the detail of the type of expenses that should be included in calculation of the amount of controlled expenditure associated with any manifesto or other document setting out the third party’s view on the policies of a party or candidate.

At present, recognised third parties incur controlled expenditure in connection with the production or publication of election material which is made available to the public. That will normally cover activities such as advertising, unsolicited material addressed to electors, and any manifesto or document setting out the policies, or the recognised third party’s view on the policies, of one or more parties or candidates.

While schedule 3 expands the range of activities that may constitute controlled expenditure, manifestos or policy documents—being election material—are already covered by existing law, and will remain so. They are simply described here in a different way. I therefore urge that the amendment is not pressed to a vote.

References have been made to press conferences and rallies. I know that the TUC has expressed fears that it will not be allowed to hold its rally. Our view is that the TUC would not promote parties or political candidates at the rally—especially given what is happening at the TUC conference today, where it could almost be argued that the TUC is supporting anything but the Labour party. [Interruption.]

[The Temporary Chairman (Sir Edward Leigh)]

Order. There are too many private conversations and sedentary interventions. May we have a bit of peace and quiet so that we can hear the Minister?

[Tom Brake]

I suspect that the Committee is becoming restless, Sir Edward, and that I need to move on very, very promptly. Members will be pleased to learn that I have reached the penultimate page of my notes.

I have explained to the hon. Member for Caerphilly that staff costs are covered by the controlled expenditure rules that apply now to non-party organisations. Therefore, by extending the definition of controlled expenditure, we are requiring them to account for staff costs in the areas that are now also covered by controlled expenditure.

[Wayne David]

rose—

[Tom Brake]

I am not going to give way. I have made that point clear. I do not think the hon. Gentleman understood it, but I hope he does now.

The hon. Gentleman asked why staff costs are accounted for for non-party organisations but not for political parties. The role of political parties is entirely to campaign politically and therefore all the staff costs of any political party would have to be accounted for as part of controlled expenditure. I do not think he is advocating that.

I have come to the end of my notes. Having heard the firm undertakings the Government have given to engage with the NCVO, the Electoral Commission, the Opposition and a number of organisations that are going to respond to the amendment when it has been published in advance of Parliament returning, I hope my hon. Friend the Member for Caithness, Sutherland and Easter Ross will think that we have done enough for him to withdraw his amendment.

[John Thurso]

This has been a substantial debate both in time and in content, and I am very grateful to all Members on both sides of the Committee who have contributed to it, and also for the widespread support—albeit some of it, I suspect, slightly unintended. The debate has raised an important question. I shall not refer to all the speeches, but I will make one point. I intervened on the hon. Member for Banff and Buchan (Dr Whiteford) to reiterate a point made by the Chair of the Select Committee: that so much of this is about perception. My amendments are, by returning to the status quo, designed to get rid of one of the perceptions. I am therefore very grateful for the undertaking the Minister has given, which is that the substance of my amendment will be included in the amendment he will bring forward on Report, that he will consult with the Opposition and the voluntary organisations, and that the amendment will be published sufficiently far ahead of our proceedings on Report to be properly considered by everybody.

I have never managed to get any concession out of a Minister before in my life and it is a lovely way to celebrate my 60th birthday, so I will accept. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question put, That the clause stand part of the Bill.

16:38

Division 80

Ayes: 298

---

Conservative: 252
Liberal Democrat: 43
Independent: 2

Noes: 245

---

Labour: 226
Democratic Unionist Party: 6
Scottish National Party: 5
Social Democratic & Labour Party: 3
Plaid Cymru: 3
Conservative: 2
Independent: 1
Green Party: 1

Clause 26 ordered to stand part of the Bill.

Schedule 3

Controlled expenditure: qualifying expenses

Question put, That the schedule be the Third schedule to the Bill.

16:51

Division 81

Ayes: 296

---

Conservative: 250
Liberal Democrat: 43
Independent: 1

Noes: 247

---

Labour: 228
Democratic Unionist Party: 6
Scottish National Party: 5
Social Democratic & Labour Party: 3
Plaid Cymru: 3
Conservative: 2
Independent: 1
Green Party: 1

Schedule 3 agreed to.

Clause 27

Changes to existing limits

[Jacob Rees-Mogg (North East Somerset) (Con)]

I beg to move amendment 101, page 13, line 31, at end insert—

‘( ) In section 94(1) of the Political Parties Elections and Referendums Act 2000, after subsection (1) insert—

(1A) During a regulated period no controlled expenditure is to be incurred by any third party that is in receipt of public funds in the 12 month period prior to the start of the regulated period.”.

( ) In section 94(2) after “schedule 10” in line 3, insert “or by (1A) above.’.

[The Temporary Chairman (Sir Edward Leigh)]

With this it will be convenient to discuss the following:

Amendment 66, page 13, leave out lines 32 to 35.

Amendment 165, page 14, line 2, at end insert—

‘(3) Subsections (1) and (2) may not come into force until such time as the Electoral Commission has placed before Parliament a report on the impact of subsections (1) and (2) on relative controlled expenditure by political parties and non-parties in regulated periods.’.

Clause stand part.

[Jacob Rees-Mogg]

It is a great pleasure to speak while you are in the Chair, Sir Edward, on the feast of St Pulcheria, who died on this day in 453 AD. It is the 1,560th anniversary of her death.

[Helen Goodman]

Having read the hon. Gentleman’s amendment, I wonder whether he is trying to take us back to the politics of those years.

[Jacob Rees-Mogg]

Even this Parliament did not exist under the benign reign of the Empress Pulcheria, so I am afraid that I am unable to propose doing that.

The purpose of my amendment, which I think fits very well with the clause, which I support, is to limit the ability of people in receipt of public funds to intervene in elections, particularly general elections. In this country we do not have state-funded political parties. We have Short money and Cranborne money to help the parliamentary activities of Opposition parties, but we have consistently decided that the state would not fund political parties and that they would instead be funded by private donations, trade union donations and business donations. It therefore seems to me to be completely wrong for third parties that might depend on subventions from the state for a large part of their income to be able to campaign as third parties in general elections.

[John Mann]

Will the hon. Gentleman let us know what he has against the Church of England, because this brutal amendment would particularly hurt the Church in its desire to host election rallies, hustings and so on?

[Jacob Rees-Mogg]

It would not in any way affect the Church of England and, anyway, should the Anglican Church intervene in elections, that would be a constitutional impropriety. It has long been the case that it is thought improper for peers to involve themselves in general elections. Members will recall that Lord Salisbury would not intervene for that reason; he let others campaign for him. It would not be constitutionally right for bishops to intervene in general elections. The Church of England is not affected by my amendment and it is not, as a general rule in its putting forward of the gospel, getting public money.

[John Mann]

I am sorry to disabuse the hon. Gentleman, but if the Church of England or other religious bodies host any kind of hustings and exclude, say, a fascist from them, they will be caught not only by the Bill, but even more so by the hon. Gentleman’s amendment, because those bodies receive public funding. Local church buildings were given specific amounts in the last Budget.

[Jacob Rees-Mogg]

The hon. Gentleman is simply wrong. We heard during the debate on the previous clause that if a third party invites some but not all of the candidates to a hustings meeting, that may be part of the election expenses of the people involved. The Bill makes no change to that situation. It has always been a difficulty. It is an issue at every election and rightly so, because it would be entirely arbitrary for third parties to decide which party they liked and which they did not.

[John Mann]

Remarkably and unusually—perhaps uniquely—the hon. Gentleman has not done his homework. This Bill expands the definition of what constitutes expenditure and his amendment worsens it further and particularly and brutally picks on the Church of England more than any other organisation by hitting it with bureaucracy and the inability to host political events.

[Jacob Rees-Mogg]

Again, I am in disagreement with the hon. Gentleman, who, surprisingly, I often agree with about many things. The amendment does not change in any way the definition of election expenditure. It leaves it as it is set out in the rest of the Bill. As I have said, that definition leaves unchanged the situation for people hosting hustings meetings. What I am doing makes not one iota of difference—not one jot of change—to the Church of the England. It will still be able to host meetings in churches and it would still be in difficulties if it decided not to invite particular candidates. That is quite right, because at the heart of democracy is the notion that candidates should be treated equally.

[Helen Goodman]

The hon. Gentleman seems to have forgotten that British Telecom, Arriva, Stagecoach, Heathrow, Virgin Care, Tata Steel and farmers in his constituency are all in receipt of large amounts of public money. Is he really saying that none of them may make statements that could be taken as interventions in a general election?

[Jacob Rees-Mogg]

The hon. Lady is ignoring the detail of the Bill and carrying on with the absurd scaremongering to which we have been listening for more than a week. A farmer in my constituency who is in receipt of subsidies would have to register as a third party and, according to the terms of clause 27, spend more than £5,000 to be in any way affected by my amendment. If only the farmers in my constituency were so rich that they were scattering £5,000 hither and yon, my own campaign might be the beneficiary of such largesse.

[Pete Wishart (Perth and North Perthshire) (SNP)]

The hon. Gentleman famously campaigned with a notable third party—his nanny—in the Glenrothes by-election. If she was in receipt of payment from the hon. Gentleman, would she have been in contravention of what his amendment suggests?

[Jacob Rees-Mogg]

That is a gloriously roundabout way of examining this issue and it gives me an opportunity to pay tribute to a wonderful nanny who campaigns for me and who is now hard at work looking after my four children, which is a great thing for her to be doing. She was a volunteer when I campaigned in Glenrothes and therefore would in no sense have been caught by this clause. Although any payment that is made to her does come from me, it is not money that I receive from the public.

[The Temporary Chairman (Sir Edward Leigh)]

Order. We will go back to the amendment, thank you.

[Jacob Rees-Mogg]

Thank you, Sir Edward.

In response to the point made by the hon. Member for Bishop Auckland (Helen Goodman), British Telecom and Arriva are not going to establish themselves as third parties in a general election. What is the idea—that British Telecom is suddenly going to send us messages saying “Vote Labour” or “Vote for a particular candidate”? That is an absurd suggestion. Is Heathrow airport going to focus on a particular candidate?

[Stephen Doughty]

On Second Reading, the hon. Gentleman said:

“A lot of campaigning organisations, including the NCVO…receive a lot of money directly from the Government, and they are now spending that Government money lobbying the Government. That seems a terrible waste of public funds.”—[Official Report, 3 September 2013; Vol. 567, c. 236.]

First, that creates a somewhat misleading picture because obviously the majority of an organisation’s funds are not spent on lobbying the Government. Secondly, will he concede that he has a wider agenda on this?

[Jacob Rees-Mogg]

I am more than happy to say that this is the tip of the iceberg and that as the Titanic steams towards that iceberg, it is about to emerge to cut a swathe through its side. I firmly believe that it is absurd for the taxpayer to dish out money that is then spent paying lobbyists to lobby the Government. That is not why hard-pressed taxpayers pay income tax, VAT and other duties.

[John Mann]

I appreciate that the hon. Gentleman is relatively new to the House. Let me point out to him that British Telecom provides assistance to the established political parties that it does not provide to independent candidates. Passing clause 27 with his amendment would therefore mean that British Telecom would be caught by the provisions of the Bill.

[Jacob Rees-Mogg]

As an established candidate before I was elected in the last election, I did not receive any help from British Telecom. I had no idea that British Telecom was funding the campaigns of candidates up and down the country. If that were a purely commercial activity, it would be mistaken in doing so because it would alienate half its customers who would dislike the party that it decided to support.

We have heard throughout these debates Opposition scaremongering about all these third parties lined up waiting to support individual candidates, with the question of whether that is against charities law or constitutionally improper being cast to one side. That is being brought back in the context of this clause. It is absolutely clear from the Bill, from what the Minister has said and from the law as it currently stands that these bodies—charitable bodies, in particular, but also firms such as British Telecom—are not going to be third parties because they do not and, indeed, should not intervene directly in the election of individual candidates or in supporting individual parties.

[Helen Goodman]

I am sorry, but the hon. Gentleman is talking out of his hat. The fact is that a lot of large private-sector businesses are donors to political parties, and that is an intervention. Is he saying that if they had been in receipt of public money, they should not be making these interventions? When they give money they are also making statements, not only about individual candidates but about parties.

[Jacob Rees-Mogg]

The hon. Lady is wrong to say that I am talking out of my hat because if I did, Sir Edward, I would be out of order and you would therefore not allow it to take place. Third parties that merely donate to other political organisations are not third parties under the terms of the Bill. To be a third party under the terms of the Bill one needs to be campaigning in such a way that one is advancing the campaign of an individual in a particular constituency or a political party across a number of constituencies. Under the terms of the Bill, giving £10,000 to the Conservative party does not require registration with the Electoral Commission as a third party. All it requires is for someone to register their donation and be a legitimate British company, as covered by the Political Parties, Elections and Referendums Act 2000. The Bill is limited in scope. It cuts the amount that third parties may spend, and my amendment would ensure that people receiving Government funding do not become third parties. That seems not only reasonable but something that the Opposition in particular should support.

17:15

People may think that the Government are benign and particularly kind and well-disposed towards them, but it is not impossible to imagine a Government who were more cynical or less honest in their approach, and who saw that they could give funds from the many billions they spend. The Government spend more than £700 billion a year, and parties in election year spend £20 million—£20 million to £700 billion: there is a huge amount of money in the Government trough, and to extract a little of that to fund those they like but not those they do not like, or to get support from friends who can use it in an election campaign, is an impropriety that a Government more cynical than this one might be tempted to use. That is why Oppositions should be nervous—rather than uninterested—at the prospect of public funding being used to support third-party campaigns in general elections.

Let me return to my original point: we in this country have decided that parties will be funded privately from sources of funding that are not dependent on the state. Having made that decision, it is illogical to say that third parties can come in, interfere in our general elections, spend money in seats spread across the country, and support particular parties with money they have received directly from the state. That would be an abuse, but it is an abuse currently allowed under the law.

[Helen Goodman]

The hon. Gentleman is wrong. There is public support for candidates in this country. We have a mixed economy because we all get free delivery of our manifestos to households in our constituencies.

[Jacob Rees-Mogg]

The hon. Lady is right that there is a free post, but parties are not publicly funded. They receive no cash for the free post; it is done without any cash transfer to parties, and they have no control of the money that comes to them. My point that parties are not funded by the state is right. There is Short money and Cranborne money, which I mentioned, but that is specifically for parliamentary activities, not campaigning.

[Charlie Elphicke (Dover) (Con)]

My hon. Friend is making a powerful speech. Is there a larger purpose here? Public funds—taxpayers’ money—are given to organisations to execute a social purpose. For that money to be used to interfere in elections is nothing short of an abuse of taxpayers’ money and trust.

[Jacob Rees-Mogg]

My hon. Friend is absolutely right.

[Helen Goodman]

What about the British Legion?

[Jacob Rees-Mogg]

The British Legion will not become a third party in a general election because it is against charity regulations for it to do so. It would be an outrage if one of the most admired and apolitical bodies in this country suddenly started saying that people should vote Conservative—let alone say that people should vote Labour, heaven forfend! Charities are not there to intervene in general elections. They have specific tax benefits and their ability to fundraise is dependent on them being charitable, not political, and there is a clear difference. There is no question of the Royal British Legion becoming a third party in a general election. That is the classic scare story that we hear again and again from the Opposition, who wish to obfuscate and confuse matters because they are worried that their trade union masters will, under this clause, have the amount they can spend reduced. They hide it; they camouflage it under this complaint on behalf of the Church of England, the Royal British Legion, and so on.

We should be concerned about third parties spending money in a way that is less regulated than political parties themselves, or having the ability to spend more and with lower effective limits on what they are able to do. The clause succeeds in doing that and would make no difference at all to charities or the Church of England. My amendment would further tighten the clause. As I have said, the Opposition should be enthusiastic about it, because it is wrong for Government money to be used by third parties when they have received it not for political activity but for their general activities of whatever kind.

[Mrs Anne Main (St Albans) (Con)]

My hon. Friend makes a powerful and interesting speech, and perhaps he can help hon. Members who, like me, are concerned about this aspect of the Bill. Will he give us examples of organisations that tread the fine line of political campaigning that would be caught by amendment 27?

[Jacob Rees-Mogg]

The Government and the taxpayer hand out very large amounts of money to third parties. Therefore, those parties should say either, “We will not take those funds,” or, “We want to be free to campaign.” They have the choice.

[Helen Goodman]

The hon. Gentleman reveals to the Committee that he does not understand how voluntary sector finances work. Voluntary sector organisations have restricted and unrestricted money. When organisations such as Shelter get money for public sector contracts, it is restricted and must be used on the service. The money used for campaigning comes from voluntary donations.

[Jacob Rees-Mogg]

The hon. Lady is not entirely accurate. If she were to trouble herself to look at the NCVO accounts, she would see that the largest contribution of non-allocated money—£500,000—is from the Government. When the NCVO spends unrestricted money on campaigning, there is a very good chance that it is Government money, which seems improper. I am well aware of the distinction between restricted and non-restricted money. Unfortunately, many Government grants are not sufficiently restricted and therefore can be used to lobby the Government. The hon. Member for Bassetlaw (John Mann) challenged me on that—I am concerned about that too, but it is not the specific point I am making.

[Stephen Doughty]

Does the hon. Gentleman believe that charities in receipt of public money should be able to campaign outside election periods?

[Jacob Rees-Mogg]

Charities should be able to campaign for their fundamental beliefs, but lobbying the Government with the Government’s money—taxpayers’ money—is a suspect activity. We do not pay our taxes to allow bodies to oppose or support the Government.

[Charlie Elphicke]

Will my hon. Friend confirm that, under amendment 27, companies such as Atos, which does considerable work for the Government, would be prohibited from indulging in campaigning?

[Jacob Rees-Mogg]

I would be shocked if Atos wanted to campaign. The idea that it should become a third party and campaign in seats is a monstrosity. Atos would be covered if it wanted to register as a third party, which is highly unlikely.

[John Mann]

Will the hon. Gentleman confirm that, if he attends and is photographed at a garden party hosted by a landowner who is also a farmer receiving public funds during an election period, the expenditure will be caught by the amendment and the Bill?

[Jacob Rees-Mogg]

The hon. Gentleman has a wonderfully vivid imagination and conjures up increasingly absurd scenarios that will obviously not be caught by the Bill.

[John Mann]

The hon. Gentleman would have been caught by his amendment. Is it not the case that he took great pleasure in being photographed repeatedly at such events held by major landowners when fighting, quite legitimately, for his seat? Those who host such events would be caught by the amendment, so his proposal is almost suicidal.

[Jacob Rees-Mogg]

The hon. Gentleman assumes I have a much more salubrious social life than I have. I wish I constantly enjoyed a round of garden parties during general election campaigns. I am sorry to disappoint him that that is not how life is in North East Somerset. I am afraid that the picture he conjures is false. That situation does not arise under the Bill. Ingenious though his vision is, it does not get away from the fundamental point that Governments have a duty to spend taxpayers’ money carefully. They also have a duty of trust to ensure that taxpayers’ money is not misspent on purposes for which it was not intended. The Government, who are very powerful when in office, have a particular obligation not to fund their friends who can then use the money they receive to support the Government’s efforts to remain in office. That is a risk that the Opposition have pooh-poohed, but it is a real risk.

[Mrs Main]

My hon. Friend is being generous in giving way, but he did not really answer the question of what problem he is trying to fix. If there is no proof of that happening, then it is a bit like me saying that I will stop kicking my dog when I do not own a dog. I am concerned that he is coming up with a complex and technical solution to a problem that may not even exist, although it may, in theory, potentially exist.

[Jacob Rees-Mogg]

If my hon. Friend had been listening to all of the debate outside the House, which I am sure she has been, she will have seen that many bodies contributing to it are publicly funded. They receive money from the state that they are now spending on lobbying the state. It is therefore not the greatest leap to assume that there are bodies in receipt of money from the state that might be interested in elections. Why? Because they are the ones complaining that the Bill is so unfair on them. If they are complaining that the Bill is so unfair on them, it must be because they intend to spend some of that money on elections. My hon. Friend must therefore see that the case is made by the people she is oddly supporting. They have given a warning about what they intend to do. Having been warned, it is surely sensible to stop this happening and to say that it is wrong for taxpayers’ money to be used to fund third parties’ election campaigns.

[The Temporary Chairman (Sir Edward Leigh)]

Order. The hon. Gentleman is starting to go around in circles, albeit in an elegant way, so he might now bring his remarks to a close.

[Jacob Rees-Mogg]

If I had not taken so many interventions I would have finished. The key point is immeasurably simple. There is a duty of care with taxpayers’ money. There is a risk of impropriety if it is spent by third parties on elections. That impropriety is a greater temptation to a sitting Government who control the purse strings than it is to the Opposition who do not. It is something that ought not to be allowed. We do not fund our political parties for their campaigning. We ought not to fund third parties. We ought to make it illegal.

[Angela Smith]

May I start my comments on clause 27 by declaring a non-financial interest in organisations in the third sector? I am the chair of the conservation and wildlife all-party group, the secretariat for which is provided by the Wildlife Trusts, and I am a vice-president of the League Against Cruel Sports. I am proud to be associated with both organisations.

Clause 27 depends for its validity on clause 26, which we have just discussed. In my opening remarks, therefore, I want to make it absolutely clear that if the Government’s intention is to rewrite clause 26 at some point—as they have indicated this afternoon that they will—the Opposition are justified in not supporting the subsequent clauses that depend on it. The Electoral Commission made this point in its latest briefing notes:

“We recommend that once the definition of controlled spending is confirmed, the Government and Parliament should consider again what spending limits will provide the appropriate balance between freedom of expression and controls on undue influence.”

In that context, the Opposition will find it difficult to support clause 27 as it stands. Indeed, we still fail to understand how the Government can support their own clause 26 when they considered in the previous debate that it needed rewriting, but there we are. We will listen carefully not only to the Minister but to the esteemed Chair of the Political and Constitutional Reform Committee, my hon. Friend the Member for Nottingham North (Mr Allen).

We support taking the big money out of politics and we support sensible controls on the money spent by third parties. That is why we introduced the cap on third party spending, ensuring that we would never be like the United States, where unaccountable organisations can spend vast sums of money. We have no objection to a tough cap on third party spending.

17:30

[Andrew Gwynne]

Does my hon. Friend agree that the provisions in the Bill do not even attempt to tackle the very issues she is talking about? In the 2010 general election, the main political parties spent £31 million; third parties spent £3 million on campaigning activities in that year.

[Angela Smith]

My hon. Friend makes an important point that I will come to in due course.

This Bill puts the cart before the horse. Our contention is that this is the wrong way to tackle the very serious issues at stake and that what we actually need is an approach that focuses, first, on taking the big money out of politics and then places changes to third sector funding in the context of this much more fundamental and necessary reform of election funding. Let us be clear: that is the right way to tackle the issue because, to put it quite simply, the big money is not in third party spending. Political parties nationally—as my hon. Friend the Member for Denton and Reddish (Andrew Gwynne) has said—spent £31 million in the 2010 election, compared with just £3 million by third party campaigners. The biggest third party spender spent just 4% of the £17 million spent by the Conservative party.

While the Government claim that this is an attempt to take the big money out of politics, they do not even mention the real source of the problem: the amounts spent on election campaigning by political parties. If the Government are serious about taking the big money out of politics, they would be looking at a reduction in the overall expenditure cap for political parties during election years. If the Conservative party, in particular, is serious about taking the big money out of politics, it will withdraw this mess of a Bill and commit to meaningful reform. This is a bad, and badly drafted, Bill and it is very unlikely that, however much it is amended, it will stand up to serious scrutiny as a fair and workable piece of legislation. It is a Bill found wanting, partly because of the lack of rigorous consultation and partly because of the lack of pre-legislative scrutiny, as the Chair of the Select Committee pointed out.

[Charlie Elphicke]

On the amendment proposed by my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg), is it the hon. Lady’s position that organisations in receipt of public funds should be allowed to spend the money on election campaigning or that they should not?

[Angela Smith]

I have noted the hon. Gentleman’s interest in this issue in the past. I point to the answers given by my hon. Friend the Member for Bishop Auckland earlier: funding agreements between the state, local government and charities tend to make it virtually impossible for charities spending public funds to spend them on any other purpose.

This is a dog’s dinner of a Bill and, as the hon. Member for Harwich and North Essex (Mr Jenkin) said a short while ago, even that description of the Bill is an insult to dog nutrition. So let us be clear: our invitation today to the Conservative partners in the coalition is to place reform of third party spending in elections clearly in the context of a cross-party consensus on political party funding and political party spending. We need to see a cap on donations to political parties—our leader has suggested a cap of £5,000—and we need to see meaningful reductions in spending limits by political parties in general elections. We need to stop this spending race, which sees spiralling sums of money spent on successive elections. No more dodgy dinners in Downing street; no more bankrolling of the Conservative party by a tiny number of wealthy City donors. The Electoral Commission itself has made it clear that reform of third party spending is needed, but not like this. Clause 27 has caused huge consternation in the third sector, because if passed into law, it would play a major part—along with the other clauses in part 2—in effectively gagging the third sector in election periods. The changes will have a chilling effect on our national debate in the year before the election. That cannot be right for any modern, 21st-century democracy.

[Mr Anderson]

In an earlier debate, our hon. Friend the Member for Bassetlaw (John Mann) raised with the Deputy Leader of the House, who is no longer in his place, the scenario in which charities would not be allowed to campaign in his constituency, yet political parties could spend £250,000 there, as they did, trying to undermine him and make him lose his seat. Is that not the real scandal of this Bill? It does nothing to address that concern. It will affect charities, who have a genuine right to lobby, but do nothing about such abuses of power.

[Angela Smith]

Our hon. Friend the Member for Bassetlaw (John Mann) articulated clearly the feelings of parts of many organisations in the third sector, who feel aggrieved that they are being picked on, as it were, in this Bill while the big spending takes place elsewhere.

The sceptical among us could be forgiven for thinking that in part 2, and clause 27 in particular, the Government appear to be trying to insulate their record and policies from legitimate democratic criticism. For example, a number of recent high-profile third sector campaigns could well have been stymied if this Bill had been in place. They include campaigns such as Stonewall’s equal marriage campaign or the Royal British Legion’s military covenant campaign. Indeed, as has been made clear on a number of occasions this afternoon, the National Union of Students could find it difficult to hold Members to account in the forthcoming election period.

It is perfectly possible that the Bill could also prevent the coalition of charities campaigning for plain packaging for cigarettes from making its case in the forthcoming election period. That is how serious the effect of this Bill could be. Cancer Research UK and the British Heart Foundation could suffer the dampening effect of this Bill, and thereby become reluctant to make their case, while at the same time Lynton Crosby—a lobbyist for the tobacco industry—is working from the heart of the Government machine in Downing street. At a time when trust in politics is at an all-time low, why do the Government want to restrict the one part of our politics that is doing a good job in engaging people from all backgrounds in our political process? Why do the Government want to risk lowering the reputation of our political culture even more?

Clause 27 also illustrates a worrying trend on the right in politics—the challenge to the role of charities in the Prime Minister’s big society. Let us take the recent speech by the Justice Secretary, who proposed in an article in the Daily Mail recently that we ought to curtail the use of judicial review because—in his words—

“judicial reviews are launched in order to try to disrupt Government policies, such as those initiated by anti-HS2 campaigners or by those who believe it is right that taxpayers’ money should be spent on subsidising people in social housing to keep spare rooms.”

More and more, we are seeing challenges to a vibrant civil society—challenges that, if acted on, would contribute to an insulation of Government from the crucial checks and balances needed in a healthy democracy.

[Lady Hermon]

I would like to draw the hon. Lady’s attention to a problem with how clause 27 will apply to Northern Ireland—I should have intervened on her a little earlier, but I am sure she will not mind my intervening now. She will have noticed that the limit on controlled expenditure will be reduced in Northern Ireland from £5,000 to £2,000—not £2,500, but £2,000. I would like her and her colleagues—and, of course, the Minister—to address the fact that charities like the National Trust are national, covering the United Kingdom as a whole. Will the National Trust’s national expenditure or its expenditure in Northern Ireland be caught by the limit?

[Angela Smith]

The hon. Lady makes a valid point. The reduced limits for the devolved Administrations relate not just to Northern Ireland but to Scotland and Wales. I do not think the Government have thought clearly about the fact that many third sector organisations in the UK are UK-wide, so I take her point.

[Dr Alan Whitehead (Southampton, Test) (Lab)]

Does my hon. Friend think that there is even a modicum of reason behind the proposal to reduce thresholds based on the fear among those on the Government Benches that an individual might decide to campaign on a third party basis and put large amounts of money into such a campaign? The legislation might catch the organisations that she has described, but does she agree that it would be very easy for an individual to be vague about such arrangements, as has happened in America with third party political action committees and related individual-funded organisations? In such circumstances, the provisions would not work.

[Angela Smith]

I will comment on the reduction to the thresholds presently. Suffice it to say at this moment that the Electoral Commission itself has suggested that the thresholds might even need raising, rather than lowering.

There is a real suspicion out there in the third sector that, unfortunately, many Conservatives would like to see charities pare down their role, shrink their campaigning brief and concentrate instead on welfare provision. That fear has already been borne out in this debate. There is nothing wrong with charities providing help and support for the sick, the young and the old, or for animals in distress—indeed, there is everything right about it—but they also need the freedom to campaign for the legislation and funding that are necessary to make the world a better place.

We have heard the views of the hon. Member for North East Somerset (Jacob Rees-Mogg) on the campaigning role of charities and voluntary organisations. The hon. Member for Dover (Charlie Elphicke) said recently that

“many charities need to renew their sense of mission, spending less time at conferences and more time valuing their volunteers. They should concentrate resources on helping people rather than campaigns, lobbying and administration”

and the hon. Member for Witham (Priti Patel)—

[Charlie Elphicke]

Will the hon. Lady give way on that point?

[Angela Smith]

Of course.

[Charlie Elphicke]

The hon. Lady will know that I was expressing my concern that the chief executive of Save the Children had had a pay rise of some 22% since 2010, while many of our constituents have been struggling to get by. It is right that we should ask the charities to refocus on their front-line mission and to help people rather than helping themselves.

[Angela Smith]

I believe that the issue of third sector chief executives’ pay is being used as a smokescreen to conceal a real attack on the sector’s legitimate role of holding elected representatives to account and campaigning for the changes in society that it believes need to take place.

[Charlie Elphicke]

There is a legitimate role for third sector organisations in making their case to elected representatives, as they have done, but some charities’ pay is out of control and their administrative expenses are too high. In those cases, not enough help is reaching the front line. I am concerned about the alleviation of poverty and about helping people in need on the front line, and it is really important that charities should have those values—

[The Temporary Chairman (Sir Edward Leigh)]

Order. I think we are starting to stray from the matter before us.

[Angela Smith]

Thank you for your guidance, Sir Edward. All I would say is that many third sector organisations listening to this debate will have been very interested to hear the comments of the hon. Member for Dover.

Some—not all—Members on the Government Benches are clearly intent on curtailing the third sector’s crucial work of shining a light on inequality where it exists, and of campaigning and highlighting the need for changes in public policy, based on their experience and expertise.

[Mr Kevan Jones (North Durham) (Lab)]

One organisation that has made a great contribution, under the previous Government as well as this one, is the Royal British Legion. It has campaigned for the rights of veterans, and I was on the receiving end of some of that campaigning when I was a Minister in the previous Government. Its effective lobbying has changed the law under both Governments. Is it not ironic that Conservative Members who have signed up to its campaigns are now saying that such campaigning should no longer take place?

[Angela Smith]

I agree entirely with my hon. Friend. Indeed, it would be interesting to trawl the websites of many Members to see the lists of charities that they support on a regular basis. I imagine that every Member of the House supports the Royal British Legion and its campaigning work, and would want that work to continue.

As I said earlier, clause 27 plays its own role in gagging the third sector by reducing the threshold for registration and reducing spending limits on controlled expenditure. Under amendment 66, tabled in my name and that of my hon. Friend the Member for Caerphilly (Wayne David), the threshold for registration would be returned to the status quo, thereby protecting smaller charities and community groups from being caught by this legislation, making it virtually impossible for them to participate in the democratic process.

17:45

[John Mann]

On unintended consequences, has my hon. Friend considered the implications of the Oldham East and Saddleworth election petition judgment, whereby the number of votes influenced by the action was not a consideration? By implication, the amount of spending by which one might breach the rules would not in itself be the issue; rather, it would be whether there had been a breach. The complexity of the rules could lead to election petitions and to elected Members being thrown out of the House.

[Angela Smith]

I thank my hon. Friend. What he said provides further evidence to show how this Bill was not properly thought through before it was brought before us. It shows, too, the amount of work that should have been done and the issues that should have been sorted out before it was brought here.

[Helen Goodman]

I am sure my hon. Friend is aware—I hope so—of the paper produced by the House of Commons Library, which shows that under the Bill’s proposals, the limits on third party spending in Wales are coming down to £24,000 and to £10,000 in Northern Ireland. That would mean that in Wales and Northern Ireland, it would be impossible to employ anybody in a voluntary sector organisation to run any kind of campaign for one year in four.

[Angela Smith]

I agree with my hon. Friend on that point.

As I was saying, our amendment is designed to return us to the status quo on thresholds and to help protect smaller charities and groups from being caught by legislation, making it virtually impossible for them to participate in the democratic process. That must be right, and the Electoral Commission has suggested, as I pointed out earlier, that the threshold should be raised. Let me quote from the evidence given by Jenny Watson to the Political and Constitutional Reform Committee:

“We said again in our written evidence that one practical thing that could be done to make a difference to the Bill would be to raise the thresholds at which people have to register, and we have a particular concern about that as it relates to Scotland, Wales and Northern Ireland, because those thresholds are low.”

Let me ask the Government why the voice of the regulator is being so badly ignored in respect of this legislative process. Why is the Electoral Commission being ignored? We will listen with interest to the Minister’s response on that point.

As far as the limits for controlled expenditure are concerned, our position is clear: the limits need to be defined in the context of meaningful reform of the funding of political parties and of their ability to throw big money at election campaigns. In other words, the Government need to withdraw the Bill and to rethink. They need to enter into meaningful negotiations with the other political parties and to commit to proper consultation and scrutiny of proposals as they emerge, in relation to both political parties and the third sector.

In concluding my remarks, I ask the Minister to think again about not just specific points in this clause, but something more fundamental. The Minister is a Liberal Democrat; I ask him to take back to his Conservative partners the message that the Government’s whole approach to this issue needs to be looked at again. “Think again” is our message to the Government, who should commit to discussions designed to produce meaningful reform within which we can place sensible changes to the rules on third party funding—changes that we can consult on with confidence, knowing that we have done the right thing overall in changing our politics for the better.

[Mr Allen]

Let me, just for a moment, return to our earlier debates, and ask Members in all parts of the Chamber to accept with good grace the Minister’s offer to rewrite clause 26. I do not want any Member in any part of the Chamber to talk about U-turns, or to gloat. I think that the Government have realised that the Bill is flawed in considerable part, and that, to their great credit, they have recognised that clause 26 needs to be rewritten along the lines suggested by the hon. Member for Caithness, Sutherland and Easter Ross (John Thurso) and by my Committee.

No such magnanimity, however, can be extended to clause 27. Clause 27 is the clause that is the most obnoxious to the charities that many of us support and view with great pride. Two things are being attempted. The first is to tie up those charities in red tape, with massive, indeed unprecedented amounts of reporting, and the second is to impose limits on their spending that are far more fierce and far more rigorous than those that currently apply.

[Andrew Gwynne]

My hon. Friend is absolutely right about the outcome of clause 27. Does he agree that the clause cannot be read in isolation, but must be read alongside the redrafted clause 26, because the two are connected? What we as legislators cannot do today is make a decision on clause 27 that is separate from our decision on the Government’s new version of clause 26.

[Mr Allen]

I hope that as we proceed—and it should not be forgotten that we are only at the second stage of the process, given that there was no pre-legislative scrutiny—we shall be able, bit by bit, to pull the Bill back into some sort of rationality. I do not expect it to be perfect, and I think that we shall need to revisit it in a year’s time, but I also think that we should put our shoulder to the wheel, as our charities and voluntary organisations are asking us to do. We do not have much choice: we should do the right thing by them. I hope that as the Bill proceeds through its various stages, there will be a number of opportunities for us to ensure that it is, if not a masterpiece, at least something that will tumble along rather like a wagon that has square wheels but is travelling in roughly the right direction.

[John Mann]

Has my hon. Friend’s Committee had an opportunity to consider the ramifications of the electoral judgment in Oldham? Everyone is concentrating on the impact on charities and third parties, but we should also consider the impact on candidates. If a third party were to spend a penny more than was allowed on promoting a candidate, an election petition would succeed. The ruling on the election petition at Oldham was based on a precedent 100 years ago. Is it not possible that election petitions, whether valid or not, will be issued regularly on the basis of a few pence?

[Mr Allen]

The simple answer to my hon. Friend’s question is no: the Committee has not had time to look at those matters, and neither has anyone else. The unfortunate fact of the way in which this process was rushed through—the Bill was presented the day before the House rose, and was given a Second Reading the day after it reconvened—did not allow for any of the sensible accountability that the House should expect.

My hon. Friend has, however, made an excellent point. Indeed, excellent points have been made from all sides throughout the debate. I think that we should value what Members can bring to bear on this process, and I think that if the Government care to listen—and they are starting to listen—we will end up with a much better Bill.

[Dr Francis]

rose—

[Mr Allen]

One issue on which the Government need to listen very carefully, so that they do not find themselves in the High Court or the Supreme Court, is the issue of human rights, to which I am sure my hon. Friend the Member for Aberavon (Dr Francis) is about to refer.

[Dr Francis]

Has my hon. Friend’s Committee given any consideration to the possibility that this is a hybrid Bill and if it passes—I hope it does not—it will be subject to legal challenge and judicial review because of the discriminatory way in which it deals with charities?

[Mr Allen]

Again, no, we have not had the time to do that. My Committee produced a very hurried response, which required its members to come back in the recess to take evidence. We ought now to take the time to have a proper look at such issues and get these provisions right. That is one of the reasons why I urge the Committee not to agree that clause 27 should stand part of the Bill.

We have done well today. A lot of people have been involved in helping the Government to see the truth. We have got them to it on clause 26, but on clause 27 we still have a great deal more work to do. I do not want to box the Government into a corner, but I think the best way to proceed is to decide that clause 27 should not stand part of the Bill so that there is then a period in which they can rewrite it and make it acceptable.

[Wayne David]

I agree with the argument being elaborated by the Chair of the Select Committee. The Electoral Commission says it finds it difficult to understand the rationale behind the Government’s proposed changes. On clause 27, has my hon. Friend discovered the Government’s rationale for arguing for a reduction in the thresholds for third sector organisations so that many more are caught?

[Mr Allen]

I am afraid I must give the third negative reply in a row: we have not discovered that rationale, but the search goes on and I am determined that before the end of this process—before Her Majesty signs this Bill into law—we will have discovered it. Until then, it is the job of all of us across the House to try to make this Bill less hurtful, harmful and oppressive to the charities that we all care about. A small step has been taken today, which gives great cause for optimism, as does the fact that the Minister accepted an amendment from my Committee last night and even adopted it as the Government’s own. I was very grateful for that. It shows we can move forward.

We are engaged in an incremental process, and Parliament has an important role to play in it.

[Andrew George]

The hon. Member for Bassetlaw (John Mann) seemed to imply in his recent intervention that a local charity that spends a small amount of money in support of a candidate in a constituency would be caught by these limits. If that is the case, we do not need to debate it any further, as it is clear that that should be ruled out. If any charity or community organisation is engaged in promoting any candidate or political party, that is outwith the purpose of the charity or community organisation, and what it spends on that should be counted as election expenses.

[Mr Allen]

I am sure the Chair will rule me out of order if I return to previous debates, but suffice it to say that, under the current definition in the Bill, if an organisation is seen to enhance the standing of any candidate, they will be caught by this, and that is such a—

[The Temporary Chair (Sir Edward Leigh)]

Order. Many Members want to contribute to this debate, and I know that the very experienced Member speaking will want to get back to the point very quickly.

[Mr Allen]

Thank you, Sir Edward, but I had seen the Government Whip running round trying to roust up a couple of speeches from the Conservative Back Benches so I assumed we had a little time. I will try to be more concise, however.

The proposal is to tighten the current spending limits, but they have served us well. As far as we could ascertain, they have elicited not a single case or complaint. We heard the same response time and again: “We have already got limits. Why on earth do we need to change them?” Again, there seems to be no clear rationale for doing that. But the impact of lowering the limits is, obviously, to reduce the amount of money that charities, voluntary sector organisations and others can spend in pursuit of their legitimate objectives. If people go crazy and start to spend them on illegitimate objectives, they will get caught by existing legislation, let alone future legislation.

18:00

Which are the organisations that are going to go wacky? They are the Royal College of Midwives—yes, probably—Action for Children, the Howard League for Penal Reform, the Royal British Legion and Oxfam; those organisations gave evidence to my Select Committee about their concerns. They are not fringe; they are not just within the bounds of legitimacy. They are mainstream bodies, many of which have been going for 100 years or more. The National Trust is another—it is almost a newcomer, having been going only since the 1920s, I believe. I could also mention Christian Aid, the Stroke Association, Girlguiding, the Woodland Trust, the Royal Mencap Society, the RSPB, Friends of the Earth and the Salvation Army. They are big and can look after themselves. They can get a brief and some legal advice. More chilling is what might happen to others who gave evidence. What about the Foyle Women’s Information Network and the Newcastle Council for Voluntary Service? They cannot take a risk of being interpreted, under the definitions in this Bill, as being even marginally in an area of transgression.

[Tom Brake]

In the hon. Gentleman’s last sentence he moved off the main point he was referring to, which was the cap. Did any of the organisations he just cited as having given evidence to his Committee say that they intended to spend more than £390,000 on supporting a political party in the 12 months before the general election?

[Mr Allen]

Give me the time to undertake accurate pre-legislative scrutiny of the Bill and I will give the right hon. Gentleman his answer.

What we should be doing in this place is adding to the rich tapestry of our democracy, not emaciating, frightening, chilling or putting a shadow over it. We should not be having people who fear engaging with their politicians and fear being part of our electoral process. We should have people who say, “We are welcome. Parliament is passing something that says, ‘Come in, we want to hear you. You are the big society. We want to listen to what you have to say.’” Are we saying that today? No, we are not, as we can see when we look at clause 27. This House should be sending out a much more positive message to those organisations, and to everybody else who wants to support and develop our democracy.

[Lady Hermon]

It is kind of the hon. Gentleman to take an intervention, and I appreciate his patience. He has recognised that clause 27 has particular implications for Northern Ireland, Scotland and Wales. May I urge him to use his persuasive powers on the Deputy Leader of the House and his colleagues on the Front Bench to ensure that when they amend clause 26, as they have agreed to do, and, in line with it, clause 27, they consult not only the Opposition, including him, but representatives from the regions?

[Mr Allen]

I would love to use what little persuasive powers I have on the Deputy Leader of the House and the Parliamentary Secretary, Cabinet Office, the hon. Member for Norwich North (Miss Smith), who has responsibility for constitutional affairs. I think they would be receptive, because they are affable and approachable, and they have always been understanding of what the House needs. Unfortunately, the people we need to persuade are not here. They are not listening to our debates, but we need to make sure that that message gets to them. Inconvenient as it may be when we get e-mails and letters from the big organisations I mentioned, that is their cry for help. They are requesting us to get that message over not to the people on the Front Bench at the moment, but to people a little deeper in the No. 10 and Whitehall machine. Those people must start to listen.

What amazes me is that we started off more than 16 or 17 months ago with a lobbying Bill. That was what we were looking at, and it was what my Select Committee was looking at for more than a year. We were pottering along, not very urgently, as it looked like the steam had gone out of it. There was a lot of stuff going on around the election period, but there was no great rush. When we completed our consideration, some members of our Committee—former members who are in the Chamber today—had moved on to greater things. Being on my Select Committee is a great way of getting promotion—he says, trying to fill one or two vacancies. Those people had moved on to other things before the Government got around to answering the report; it took them more than a year. The report was about lobbying.

[Sheila Gilmore]

Will my hon. Friend give way?

[Mr Allen]

I shall give way shortly to another distinguished member of my Select Committee.

The incubus of parts 2 and 3 developed suddenly just before the recess. Suddenly something changed and the pace of activity rocketed from lethargy and sloth to knee-jerk and hyper-speed to get this thing out into the parliamentary domain and through the House without due consideration. We need to ask some questions about that and consider not giving the all-clear to clause 27—the most offensive clause in the whole Bill—without that proper explanation.

[Sheila Gilmore]

I would not like my hon. Friend to give the impression that there was no sense of urgency among members of the Select Committee.

[Mr Allen]

Oh no.

[Sheila Gilmore]

It was the Government’s response that was at fault. Significantly, the Electoral Commission was very clear in its recommendation on restrictions on spending. Surely it is important that the Government should listen to such bodies, which have the experience.

[Mr Allen]

Absolutely. The Electoral Commission comes before us quite a lot and it is pretty hard to get anything off the straight and narrow out of those people. They are impartial civil servants—it is like talking to the Boundary Commission or comparable public officials—who take their jobs seriously. It is impossible, even with the talents I have on my Committee, to lure them into the political domain, quite rightly. I urge hon. Members to read what the Electoral Commission said in evidence about the spot it has been put in by how the Government have rushed the Bill through. I shall make a couple of points on that in a moment.

It used to be a lobbying Bill, but now it is a lobbying Bill and some. It is the “and some” that causes the problems. However, as we discovered during yesterday’s debates, the lobbying provisions apply to Mencap and Save the Children. I had not realised their massive significance in general elections in Britain. I thought they were a helpful adjunct and were interesting, challenging and demanding, but I had not realised that they decided the outcome of general elections. This lobbying Bill, however, leaves out some of the biggest beasts in our political firmament. It does not catch the people who said, “It’s The Sun wot won it,” after a general election. It does not capture those people, such as Rupert Murdoch, who have massive influence. So, even on its own terms, before 27 July, this was an inadequate Bill. Instead of our being able to focus on that, however, clause 27 has been added. As I mentioned yesterday, it impacts on, and has managed to create a unity in, the voluntary and charitable sector that has been hitherto unseen. That, I think, is a perverse achievement by the Government.

[Mr Tom Clarke (Coatbridge, Chryston and Bellshill) (Lab)]

My hon. Friend is making another excellent speech and has clearly done a splendid job. Was he as surprised as I was to look at the explanatory notes on the Bill, and particularly on clause 27, and see that Scotland is allocated a mere £35,400? Can he, with all his experience, tell me what I should say in my constituency if one third party wanted to campaign in favour of fox hunting and the other against it? For example, how could they employ people based on what seems to me to be a ridiculous amount?

[Mr Allen]

I do not want to get drawn into too many specific cases, but my right hon. Friend highlights one issue, which is, when two charities who wish to pursue their legitimate aims are at variance with each other, how do they not, in an election year—because it is known when the election will be; it is 602 days from today—launch legal action against each other? Such bodies can be a bit litigious. Will the League Against Cruel Sports allow the Countryside Alliance to get away with something that might just be embarrassing? Instead it will say, “Let’s see if we can nudge them into court; let’s tie ’em up a little bit.” Or is it possible—the hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart) is in his place—that the Countryside Alliance might even say to the League Against Cruel Sports, “You have stepped over the line here,” with such amounts of money as my right hon. Friend the Member for Coatbridge, Chryston and Bellshill (Mr Clarke) referred to?

Then in comes the police force. Who will be the police force? It will be the Electoral Commission. The Electoral Commission will be pushed in between two contending charities to be the referee—to push those people apart. And do what else? If it is informed by one slightly malicious party that an infringement is going to take place, does it have to send its own people? Do they have to stop people getting on the platform? Do they take down the advertisements outside? What are we doing making the Electoral Commission the thought police of free speech in this country—a job it does not want and has not asked for, and was not even consulted about before it picked up the Bill at The Stationery Office? It was not even consulted about the proposed change to its role.

[Several hon. Members]

rose—

[The Temporary Chairman (Sir Edward Leigh)]

Is that the end of the speech?

[Mr Allen]

No; I was giving way to my hon. Friend the Member for Penistone and Stocksbridge (Angela Smith).

[The Temporary Chairman]

The hon. Gentleman is a very courteous Member. He will want to know that six other Members are trying to speak, and the Minister, so I know he will want to allow other Members to get in—but there is an intervention.

[Angela Smith]

My hon. Friend’s hypothetical example prompts me to point to the supreme irony that the Bill has pulled together the Countryside Alliance and the League Against Cruel Sports in opposition to it.

[Mr Allen]

I am conscious of the justified blandishments of the Chair. I had assumed that I was being required to speak to take us somewhere towards the Division, but I will conclude quickly.

First, thresholds for registration are in clause 27. My Select Committee said:

“In the absence of any evidence that there is a need to lower the threshold for third parties to register with the Electoral Commission, we recommend that the Government revert to the existing levels. To this end, we recommend that clause 27…is removed from the Bill.”

Secondly, as far as the Committee could see, there was no justification for the new lower spending limits. Witness after witness came before the Committee, and not a single one said, “This is fantastic. We have been waiting for ever for the Government to do this on spending limits.” The Joseph Rowntree Foundation said:

“The cost limits are reduced in a way that is neither explicable, nor relevant.”

The NCVO does not know the basis on which the Government decided on the new limits for expenditure, adding:

“One may suggest that they are arbitrary.”

That is why we set our face against those limits, and we say to colleagues in all parts of the House that until there is a proper justification of that, we feel that clause 27 should not progress.

Finally, as a chair of a charity and a trustee, I will remake the point that I made the other day in respect of clause 27. If there is even the faintest question mark over the hard-earned money of my charity, due to the possibility that we may get sucked into legal action and have to pay someone else’s costs on a six-figure basis, I am looking at having to sack people. I am not going to do that. It is no good, Minister, restraining, by some technicality, something that I have worked very hard to create.

18:15

I respect the Minister, who has been put in a very difficult position by some of his colleagues. I respect him when he says, “Don’t worry, Graham. That’s going to be okay. You’re not going to be caught.” There are many barristers and lawyers out there who live by the fact that people make technical mistakes. If I make a technical mistake by asking whether I can write to every candidate in the next general election and tell them about the wonders of early intervention, which my charity pursues, and I do it in slightly the wrong way, I put at risk the whole enterprise, and I am not prepared to do that. The Government are chilling me—stopping me engaging in the process.

[Simon Hart (Carmarthen West and South Pembrokeshire) (Con)]

Will the hon. Gentleman give way?

[Mr Allen]

If the hon. Gentleman, formerly of the Select Committee, will allow me, I must make progress because many others wish to speak.

The risks that I have outlined are the consequence of the Government not being clear, not consulting and not drafting the Bill in a sensible way.

I will finish on the Electoral Commission being the free speech police. In an excellent contribution, the right hon. Member for Haltemprice and Howden (Mr Davis) suggested that the Electoral Commission would be the IPSA for elections. If that argument does not win over colleagues who are still wavering, I do not know what will. I congratulate the Minister and the Government on what they have done on clause 26. That is eminently sensible. It should enjoy the support of the whole Committee, but on clause 27 the Committee must send a further signal to the Government and to the second Chamber, so on behalf of the all-party Select Committee, which was voted in by colleagues throughout the House—for the first time ever, we have elected our Select Committees—and on the basis of a unanimous report, I ask Parliament to support me in voting no on the Question that clause 27 stand part of the Bill.

[Several hon. Members]

rose—

[The Temporary Chairman (Sir Edward Leigh)]

Order. For the guidance of the Committee, I would like to get the Minister in by 6.45, so if hon. Members could try and speak for not much more than five or six minutes, that would be a great help.

[Charlie Elphicke]

It is a pleasure to follow the hon. Member for Nottingham North (Mr Allen), who speaks to the Committee with great experience, but on this occasion I cannot agree with him. I support my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg) and the wording of his amendment:

“During a regulated period no controlled expenditure is to be incurred by any third party that is in receipt of public funds”.

There has for some time been a problem with using public money to get involved in our political system, and that has caused me considerable concern. The Public Administration Committee looks at charities, what they do and how they act and operate. The findings of some of our investigations are a matter of grave concern. There has been a tremendous change over the past 15 to 20 years in the third sector and how it operates, which makes my hon. Friend’s amendment relevant, but also means that clause 27 and the Bill in general should be brought to this Bill Committee.

In the past 15 years the state funding of charities in Britain has increased significantly, while restrictions on political lobbying by charities have been substantially relaxed. Some 27,000 charities are now dependent on the Government for more than 75% of their income and the voluntary sector receives more money from the state than it does in voluntary donations. That fact is pointed out by the Institute of Economic Affairs in its report entitled “Sock Puppets”. It is important for us to be aware of that.

[Mark Durkan]

The hon. Gentleman has just said that there has been a significant increase in public funding to charities in the United Kingdom. Does he recognise that much of that increase can be traced to the fact that many services are no longer provided by the public sector and instead are contracted out and commissioned in that way? Organisations that, among other things, are providing services at good value for money to the public would be caught by the amendment.

[Charlie Elphicke]

The hon. Gentleman strengthens my argument, because the point I was coming to is this: if an organisation is in receipt of public money for providing a service, is it really acceptable and justifiable for it to be able to lobby and spend money to warp our political system for the purposes of getting more of it? Personally, I do not think that it is.

[Mrs Anne McGuire (Stirling) (Lab)]

Does the hon. Gentleman not accept that one of the strengths of the voluntary sector in the United Kingdom is its right to have an independent voice and for it not to be assumed that, because those organisations are paid to deliver services, that independent voice should be muted?

[Charlie Elphicke]

It has been argued that state funding weakens the independence of charities, making them less inclined to criticise Government policy. In fact, there is a sense that there is a deeper problem. There is a risk that Governments could fund or create pressures groups with the intention of seeking to create a sock puppet version of civil society by giving the illusion of grass-roots support for new legislation. That has become widespread and even has a special name: Astroturfing. We all know that grass-roots campaigns being set up and “Astroturfed” is increasingly an issue, so much so that it has become part of our dictionary.

[Stephen Doughty]

When constituents write to the hon. Gentleman on a number of different causes that have been mentioned in the debate, does he consider those individual pieces of correspondence to be an illusion if they are facilitated by a charity or a charity campaign? I certainly do not; they are the voices of my constituents.

[Charlie Elphicke]

I was sent spontaneous e-mails on the Bill by a number of constituents. I believe that a number of Members of the House received such spontaneous e-mails, which of course had not been written by anyone else whatsoever. In response to those e-mails, I set out my position on charities and my concerns about pay in the boardroom and the amount spent on administration. The shadow Minister said that she is certain that people will be listening to the debate and will e-mail me right away to criticise me for the position I have taken, but many of the considered and detailed replies I received from those constituents who had e-mailed me with the so-called spontaneous e-mails said, “Actually, we see where you are coming from on charities and agree with your concerns. We think that they are important and that it is legitimate to raise them.” Far from what the shadow Minister thought the reaction would be, I had considerable support from people who, as she knows, would not naturally be supportive of me, or indeed my election.

[Angela Smith]

I feel the need to respond. I do not think that I said that third sector charities would be e-mailing the hon. Gentleman; I said that they would be listening very carefully to what he was saying in his interventions.

[Charlie Elphicke]

I thank the hon. Lady for that clarification. I think it is important that we represent our constituents. Following my direct responses to the 38 Degrees e-mails, many constituents replied and said that they saw that as a matter of great concern and that they agreed and had considerable sympathy with the position I had taken. I must say that I was surprised by that support. Having been forthright in my response, I did not expect to find much support from that particular quarter. I think that there is a message for Opposition Members to take away and consider, just as there is for Government Members. State-funded activists are engaged in direct lobbying of politicians and indirect lobbying of the public using taxpayers’ money, and I think that blurs the distinction between private and public action.

I also think that we all have a trust to uphold, in relation to the votes of supply and the impost we put on our constituents for the funding of Government and public money, to ensure that it is spent in a way that is targeted at particular social purposes and need. My concern is that if taxpayers’ money then finds its way back into arguing for more money to be spent on particular things, or indeed on the election of particular candidates or parties at an election, that is an abuse of the public trust that we are sent here to represent.

[Jacob Rees-Mogg]

I am grateful to my hon. Friend for his support. I wonder whether he thinks that it would be a good idea to table a tougher amendment on Report to ensure that lobbying money cannot be spent when it is public funds.

[Charlie Elphicke]

I am grateful to my hon. Friend for making a case that I have made in the past. Government Front Benchers are listening and I hope they will consider introducing tougher restrictions on the abuse of public funds, so that all of us who care passionately about taxpayer value and reducing taxes, cutting the deficit further and faster, and reining in waste and excessive public spending are able to ensure that our constituents get better value for money from the Government and that their money is not misspent, but spent on the social purposes for which this House votes.

[Mrs McGuire]

I fear that the hon. Gentleman does not understand the financial reporting that charities have to undertake in this country. The reality is that if a charity has a service level agreement or project agreement, those funds cannot be used for any purpose other than that to which they are contracted. His case is falling apart the longer he stays on his feet.

[The Temporary Chair (Sir Edward Leigh)]

Order. I know that Mr Elphicke will be thinking carefully of other people, so he might like to bring his remarks to a conclusion quite soon.

[Charlie Elphicke]

Thank you, Sir Edward. I will not detain the Committee for too much longer. I wish to make a few more brief points.

[The Temporary Chair]

Well, they must be very brief.

[Charlie Elphicke]

My particular concern about the state funding of charities and outsourcing of services is that they should not be in a position to use that money to lobby for more Government funds. The third sector’s increasing reliance on Government largesse has provoked lots of discussion and caused considerable concern. Critics have accused Governments of using statutory funding to silence belligerent charities or to politicise good causes.

“Guido Fawkes” says:

“A charity that relies in the main part on taxes is no more a charity than”

a lady of the night

“is your girlfriend.”

On the serious issue of lobbying for more money, we should be cautious and ensure that it is not misspent and that the regulation of lobbying should catch up with the fact that the third sector has changed dramatically in recent years and, indeed, that the historic restrictions on political campaigning and political involvement by charities, on which the Charity Commission used to be very firm, have been relaxed.

[John Mann]

Could the hon. Gentleman give one example?

[Charlie Elphicke]

Does the hon. Gentleman want an example of how a charity would be affected by the Bill?

[John Mann]

Could he name one charity that is using public funds to lobby in the way he describes?

[Charlie Elphicke]

I have considerable concerns about Shelter, which provides not shelter but advice and which is often engaged in campaigning that many Members would view as political.

[Christopher Pincher (Tamworth) (Con)]

Does my hon. Friend agree that, if a charity commissions an opinion poll that uses spurious or skewed data to publish a result that the charity then uses to suggest that one political party is good and another is bad, the use of taxpayers’ money in that enterprise would be wrong?

[Charlie Elphicke]

Yes, that would be wrong.

[Mr Allen]

It is illegal already.

[Charlie Elphicke]

The hon. Gentleman shouts that it is illegal, but the problem is that it actually happens, because the restrictions on political campaigning have been relaxed in recent years in a way that they were not in the past.

[Stephen Doughty]

I am astonished at the hon. Gentleman’s comments. Charities are restricted to act within their charitable objectives and that is enforceable by law. Indeed, some have been questioned in the past and if they are found guilty they will receive their dues. A lot of charities are being chilled by what the Government are saying, but they will be put in the deep freeze by his comments, which reveal the true purpose of a number of Members.

[Charlie Elphicke]

I cannot agree with the hon. Gentleman. He says that charities are restricted from political campaigning. If that were the case, they would not mind or object to this Bill. The issue is the direct engagement of some charities in political campaigning. My concern, which I have raised time and again, is that there should be a much greater focus on ensuring that charities target help on the front line and walk the walk rather than talk the talk.

[Sarah Champion (Rotherham) (Lab)]

I want to speak specifically in support of amendment 66 and more generally about clause 27.

Like several Members, I have had more correspondence about part 2 of this Bill than about any other issue since being elected. The undemocratic nature of the Bill has shocked my constituents, as well as charities across the UK. I urge the Government to listen to the voice of the people and this House and make radical amendments to the Bill rather than try to force something through that is clearly not fit for purpose and has not had adequate consultation.

18:30

While I am absolutely in favour of transparency in lobbying, the Government need to make a clear distinction between those lobbying for commercial gain and those trying to engage with the democratic process of bringing about social change that aids the wider population. As it stands, the Bill makes little distinction between a multinational that is pushing Government for a policy to aid their bottom line and a small charity such as GROW in my constituency, which campaigns for the voice of vulnerable women in Rotherham. I must apologise, Ms Primarolo, because I need to correct that—the Bill does of course make a distinction, as the multinational could take its lobbyist in-house and thereby circumnavigate the Bill, whereas the charity will be financially burdened and gagged by it.

Clause 27(1) seeks to reduce by 50% the level at which a non-recognised third party such as a charity, voluntary organisation or social enterprise can spend on campaigning before they need to register. If left to stand, the clause will bring thousands, potentially tens of thousands, of charities under regulation for the first time. If this happens, charities that are already facing huge cuts under this Government will be forced to shoulder an immense burden of new administration and a whole tier of extra costs. As a former CEO of charities, I can assure Members that they can ill afford the staffing or financial burden that clause 27 will impose. The reality is that charities will just stop campaigning. This Bill will literally take away their voice and the voice of the millions of people they represent.

[Simon Hart]

I am confused about the distinction that the hon. Lady is making between charitable campaigning, which is reasonably protected by this measure, and party political charitable campaigning, which is of course illegal under charity law anyway. What aspect of charitable campaigning is she worried will be wrongly interpreted, and why is the existing legislation not sufficient to deal with that?

[Sarah Champion]

First, why do we need a new Bill if the existing legislation is working? As a specific example, if GROW, my local organisation that protects women who have suffered domestic abuse, was seeking a change of which I was very supportive and was saying, “Sarah is very supportive of this”, I worry that that might fall within the new provisions.

[Simon Hart]

Will the hon. Lady give way?

[Sarah Champion]

No, I am sorry—I will not.

Amendment 66 would remove the 50% reduction in financial thresholds, and I support that. Indeed, I would like to go further and support the removal of clause 27 in its entirety. That position is also supported by the Political and Constitutional Reform Committee, which says in its report:

“We have not seen adequate evidence for setting the new thresholds for expenditure at the levels imposed by Part 2 of the Bill. The Government must explain the reasoning behind its decisions during the passage of the Bill. Even if the Government can make the case for imposing lower levels, it must be able to give a convincing account of why it has chosen these particular limits as opposed to any others. If it cannot do so, we recommend that the existing levels continue to apply until such point as the case for change has been made.”

[Several hon. Members]

rose—

[The Second Deputy Chairman of Ways and Means (Dawn Primarolo)]

Order. Before I call the remaining speakers, I want to make it clear that I intend to call the Minister at quarter to 7, and I will sit the Member down at that time if they do not sit down themselves. Three Members still wish to contribute, and I hope that each of them will be very brief.

[Mark Durkan]

Like other Members, I rise to voice my overall concerns about clause 27. I will support the call by the hon. Member for Nottingham North (Mr Allen) to vote against clause stand part. I also support amendment 66, which would keep limits as they are. We have heard no justification for the change proposed in the clause either to the threshold or the limit, and we have been given no example of anybody who has created any sort of difficulty. No scandal has been painted for us; we do not even have a scandal in waiting that anyone can point to. For part 1 of the Bill, however, we know of scandals that are completely untouched, and the message is “carry on regardless”.

It would also be remiss if we did not address some of the nonsense offered about amendment 101. Some might think it is a mad and daft measure that will get nowhere, but parts 2 and 3 of the Bill came out of nowhere. Amendment 101 is already gaining traction, and we are told that there will be an even harder version of it on Report. I therefore think that it needs to be fully and fairly reported. Not only would the amendment restrict the use of public funds for campaigning, it basically states that nobody can do anything that would come under controlled expenditure if they receive public funds, even if they are not using those funds for anything that might be defined as controlled expenditure. Therefore, if a charity, community or voluntary group receives funding, whether from the local council, a European programme, a Department or another public body, perhaps under a service level agreement, it can in no way use the advocacy side of its role in anything that might involve controlled expenditure.

In the context of Northern Ireland it is important for organisations that work and engage with young people who are otherwise disaffected—turned off by the political process, and in many ways socially disconnected—to get public funds. It is also good that in election periods they ensure there is discussion, political conversation and an opportunity for political parties, and others, to engage. Nothing is done that is unfair or gives advantage to any party. Indeed, the kind of hustings that are called put all parties on their mettle.

It is also good that women’s groups get funding, although it is often not enough. Groups such as Foyle Woman’s Aid in my constituency, or the Foyle Women's Information Network, sometimes get small amounts of money, or big amounts for the big and important services they provide. It is important that they too are part of the democratic conversation at election time, because that helps to move the debate on in Northern Ireland from the traditional binary divide that our media keep getting us caught into. All parties complain that we are constantly brought in to rehearse and refight the old arguments. We say we want to fight on wider social and economic points, but we are not able to because those who help to lead, stimulate and support people in the political process to try to move politics in Northern Ireland on to those issues—it is a contest of priorities, policies and performance in relation to socio-economic, cultural and environmental issues—have been told, “No, butt out; just let the parties do it their way. Leave control and influence around elections to the media.”

The hon. Member for Nottingham North said that the biggest people who influence elections and have all sorts of ulterior influences and interests at stake and in play are the big powerbrokers of the media. They are not touched by this Bill or anything else that the Government propose.

[Caroline Lucas]

I want to say a few words about the contributions from the hon. Members for North East Somerset (Jacob Rees-Mogg) and for Dover (Charlie Elphicke), and I am glad to follow the hon. Member for Foyle (Mark Durkan) because he made such an eloquent case. In a way, we should be oddly grateful for the contributions from the hon. Members for North East Somerset and for Dover, because they showed the nasty agenda behind this Bill. There is a real risk that someone might be taken in by the sanitised version that we hear from the Minister, who tells us that there is nothing to worry about. However, when we hear the kinds of ideas that those hon. Gentlemen have about the activities of charities and other organisations, we are right to be worried about the Bill.

I want to challenge the overall presumption of what amendment 101 is about. I disagree with the essential premise that just because someone receives public funds, they should be neutered for a whole year in what they can say. I worked for a development organisation for 10 years, and we did a lot of advocacy on trade, aid and debt. Our advocacy was based on our experience in the field, working alongside people living in poverty. Yes, we received Government money towards that programme in the field, but if that were somehow to mean that we were not able to speak out about what we saw and the conclusions of our experience, that would be a travesty of the public debate for which this country used to be famous.

I am deeply worried. The hon. Gentlemen confuse engaging in public debate during an election period, which amendment 101 states is a whole year, with electioneering. There is a big difference between the two. The idea that we cannot tell the difference is foolish, and in any case, laws govern involvement in electioneering, so we do not need the amendment.

I shall spend just two minutes on the clause 27 stand part debate, so the hon. Member for Strangford (Jim Shannon) can make a speech. I agree entirely with the hon. Member for Nottingham North (Mr Allen). Again and again, Opposition Members and some Government Members have challenged the Government and asked, “What problem are you trying to fix?” but we never hear an answer. The hon. Member for Dover eventually came up with one charity but, I must say, gave no evidence—he cited Shelter with no evidence. We cannot make policy on the basis of prejudice, which the hon. Gentleman appears to want to do. We should make policy on the basis of evidence, which is what I sought to do in a previous amendment.

If we get rid of clause 27, we can start again and think about what we want the Bill to do. I do not think we want the Bill to shut down legitimate public and policy debate and engagement in such debates from the wider public. Other people would not expect hon. Members to do that, which is why I join the hon. Member for Nottingham North in saying that we need to get rid of clause 27.

[Jim Shannon (Strangford) (DUP)]

I thank the hon. Member for Brighton, Pavilion (Caroline Lucas) for giving me the last few minutes in the debate. I concur with the hon. Member for Nottingham North (Mr Allen)—he described exactly my feelings.

Charities and the Christian organisations tell me that the Bill will reduce the financial threshold at which a third-party campaigner must register with the Electoral Commission. Under the newly broadened range of activities, if a third party plans to spend £2,000 or more in the year leading up to the general election, it must register with the Electoral Commission. The Christian Institute and the Royal British Legion are concerned about that—the hon. Gentleman mentioned a number of charities that have the same concerns.

That is a unique problem for charities, many of which hold events at the Long Gallery in Stormont in the Northern Ireland Assembly for, for example, children in care, cancer awareness-raising or women’s rights, to name three of dozens of important issues. The events are costly to hold—it is highly possible that a charity will spend £2,000 or more in the year before an election without purposely seeking to enhance one candidate over the other. The charities set out to achieve a goal, but the Bill will disadvantage them greatly. I do not believe that the Government have acknowledged or understood the key issues Opposition Members have described.

Registering with the Electoral Commission at the low threshold will create disproportionate administrative burdens on charities and regulatory bodies. One point that has not been made in the Chamber is that the limit will apply to partnership working. For example, if two charities work together on a single-issue campaign and spend £2,500 each, they must both report expenditure of £5,000, which is nearly half of the limit of £11,000 in Northern Ireland.

The awful part of the measure is that, significantly, it will become a criminal offence to exceed the spending limit. The charities will not only be stopped from campaigning; they will be criminalised, which must be wrong. I cannot understand how the Government can say that that is not the case.

Other hon. Members have indicated that there will be changes to the Bill in the House of Lords. Let us pray for those changes. If those changes are made before we debate the Bill again in the House, we will have got what we wanted, but it is a pity that the Government cannot acknowledge that point.

Under the Bill, there is a significant possibility that the legitimate campaigning efforts of community and voluntary organisations will be unduly curtailed, and perhaps even criminalised, which undermines the efforts of charitable organisations to advocate for the most disadvantaged in our society. It could also prevent politicians from hearing those voices. Would it not be a terrible tragedy if we the politicians did not hear the voice of the charitable organisations that want us to campaign on their behalf to make life better for our constituents?

The Bill must not unduly impact the vital work of the community and the voluntary circle. I support hon. Members who are trying to do away with clause 27. I ask the Government to realise they are heading the wrong way.

[Tom Brake]

rose—

[The Second Deputy Chairman of Ways and Means (Dawn Primarolo)]

Order. Before I call the Minister, I thank hon. Members for assisting in ensuring that we can hear the Minister reply to the debate before the votes.

[Tom Brake]

Thank you for assisting with that, Ms Primarolo.

I suspect that the plaudits—admittedly some were lukewarm—the Government Front Benchers received for shifting the ground on clause 26 will not be repeated in relation to clause 27. This is perhaps not the occasion to ask the hon. Member for North East Somerset (Jacob Rees-Mogg) to explain how it is that someone who went campaigning with his nanny has become such a fervent critic of the nanny state. We may have to delay that clarification.

18:44

On the substance of the hon. Gentleman’s proposals, amendment 101 would amend clause 27 so that third parties in receipt of public funding would, 12 months before the commencement of a regulated period up to an election, be prohibited from incurring controlled expenditure in that regulated period. It would be an offence for them to do so. Many individuals and organisations receive public funding to undertake work—for example, providing services or carrying out research—that also further the Government’s aims. Preventing such individuals or organisations from campaigning during the regulated period for parliamentary elections, as the amendment requires, would be an excessive and unnecessary restriction. We have been clear that we are not seeking to stop organisations campaigning on policy issues, and we are not seeking to stop them campaigning politically, although we are seeking to reduce the cap in the way referred to by other Members. The intention of the Bill is to bring greater transparency to third party campaigning. It will not prohibit campaigning altogether, as the amendment seeks to do. I therefore urge the hon. Gentleman to withdraw the amendment.

[Jacob Rees-Mogg]

My amendment would not prohibit them from campaigning; it would merely mean that they could not be registered third parties. They would still be able to campaign.

[Tom Brake]

The fact remains that, from a Government perspective, we do not want to be in a position where organisations currently assisting the Government are not able to campaign in election campaigns.

Amendment 66 would amend clause 27 so that it no longer lowers the expenditure threshold that third parties may exceed only after they register with the Electoral Commission. Clause 27 proposes that those registration thresholds be set at £5,000 in England and £2,000 in Scotland, Wales and Northern Ireland. The Government are seeking to do that because we believe in greater transparency. We believe it is important that people understand who is campaigning in the course of election campaigns. It has been said, possibly by the Chair of the Select Committee, that that will have a huge impact on a very large number of charities. The Government’s assessment of how many extra charities will be included as a result of dropping the threshold is 30—just 30 charities would be affected. I accept that potentially 30 charities may be affected, but in practice the overwhelming majority of charities will not be affected.

[Mr Allen]

The Electoral Commission has dismissed the numbers the Deputy Leader of the House is being forced to read out, and says that they are a gross underestimate, or words to that effect.

[Tom Brake]

We shall wait and see. The Government have assessed it and that is our assessment. I am not being forced to say it is 30. I am comfortable with saying that it is 30. That is what the Government believe to be the case.

[Wayne David]

If the objective is transparency, what is the logic in having a reduction to £5,000? Why not £4,000?

[Tom Brake]

The Government’s view is that we are including a wider range of organisations, but if the hon. Gentleman wants to advocate reducing the threshold to £500 he is welcome to do that, with the additional burdens it would impose on a much larger number of charities.

[Several hon. Members]

rose—

[Tom Brake]

In the 10 minutes that remain, I need to complete my remarks.

On amendment No. 66, upon registration with the Electoral Commission, third parties become entitled to incur controlled expenditure up to a higher limit and will have to comply with other regulatory requirements. The Bill lowers the thresholds in order to identify greater numbers of third parties that campaign in the political process. It is right to distinguish which organisations incur expenditure campaigning at elections and to ensure that their funds are fully accounted for. Reducing the registration thresholds, as proposed by the Bill, does not preclude third parties from campaigning. This is a point that, I am afraid, a number of Members have made: that a requirement simply to register will stop organisations campaigning. That is not so. The requirement to register will mean that the expenditure that they can incur is controlled. In the light of that, I hope that the hon. Member for Caerphilly (Wayne David) will withdraw the amendment.

Amendment No. 165 proposes that until the Electoral Commission has undertaken an assessment of the impact of clause 27 on political parties and on third parties and that report is laid before Parliament, the provisions of clause 27 may not come into effect. I have been asked why we have settled on the cap. Clause 27 amends the third party limits for controlled expenditure. These limits would be the equivalent of 2% of the maximum campaign expenditure limit for political parties. For third party campaigning across the UK, this would be £390,000. As hon. Members will be aware, currently the level at which it is set does not cover or catch any of the third party organisations.

Setting a cap at £390,000 would, as I stated earlier, capture two organisations that currently spend slightly above that cap. We think that that would, first, provide equality of arms in relation to the examples to which the Chair of the Select committee referred—the League Against Cruel Sports and the Countryside Alliance. It would ensure that one organisation campaigning in favour of something could not be heavily outgunned financially by another campaigning on the opposite side of the argument.

If at the next general election, the threshold were set where it is currently and the 30 organisations that registered all spent at their current limit—the £1 million, or just under, that they are allowed to spend nationally—they would have been able to outspend, very heavily, each of the political parties. Our view is that election campaigns are about political parties fighting and setting out their stalls, with, of course, third party organisations campaigning as well, but it should in principle be a battle between political parties.

Clause 27 also lowers the expenditure thresholds at which the third parties must register with the Electoral Commission: the thresholds are set at £5,000 in England and £2,000 in Scotland, Wales and Northern Ireland. As I stated, the Government’s assessment is that that would affect a total of 30 additional non-party organisations, not charities, as I stated earlier. Thirty additional non-party organisations might be caught by the lower threshold. The Government have already published an impact assessment on the provisions of the Bill, which considers the impact of the lowered registration threshold. It assessed that only a small number of third parties would be required to register and become subject to the regulatory framework. This will not create new administrative burdens for already registered third parties but, as I stated, may affect 30 additional non-party organisations.

The impact assessment also considered the impact of the lower spending limits. At the last general election, the largest 10% of third parties spent more than the remaining 90% put together. As I stated, only two organisations spent more than the new lowered limits that the Bill proposes. That demonstrates that the current spending limit is so high as to be ineffectual.

The Chair of the Political and Constitutional Reform Committee listed a range of organisations that he said gave evidence to his Committee. I asked him whether any of them had told him in their evidence that the Government’s proposed cap of £390,000 would affect their ability to campaign politically during the next general election, and he did not respond. I suspect that he did not respond because none of them intended to spend that much. [Interruption.] I am happy to give way to the hon. Gentleman if he is about to tell me which of those organisations said they would spend above £390,000.

[Mr Allen]

I am surprised that the Deputy Leader of the House wants to abdicate the role that Her Majesty’s Government have given to him, but I will make it clear again. The Political and Constitutional Reform Committee will pick up his remit, if he cannot do it himself. If the Government give us the time to do our pre-legislative scrutiny—time that we asked for—instead of putting a Bill before the House one day before the recess and taking Second Reading one day after, we will do that job and many others.

[Tom Brake]

Having given the Chair of the Political and Constitutional Reform Committee a second opportunity to state which organisations would be affected, I am afraid to say that he is unable to do so. I regret that. The impact assessment has been carefully prepared. Requiring the Electoral Commission to undertake another assessment is unnecessary, particularly if it would prevent a key provision of the Bill from being enacted before then. I therefore urge the hon. Gentleman not to press his amendment.

Concerns have been expressed about the cap in the Bill. We have set out why we think a national cap of £390,000 is appropriate. It would have affected only two organisations in the last general election. We have also set out why we believe that lowering the registration threshold to £5,000 would lead to greater transparency. People would be able to get more information about which organisations were campaigning in a general election. I therefore hope that the amendments in this grouping will not be pressed to a vote.

[Jacob Rees-Mogg]

Having listened to this debate and the wonderful speech by my hon. Friend the Member for Dover (Charlie Elphicke), I have discovered that all the wit and wisdom of this House would like me to bring forward a more stringent amendment on Report to ensure that no money is ever spent from Government funds and coffers on lobbying. I therefore beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question put, That the clause stand part of the Bill.

18:57

Division 82

Ayes: 291

---

Conservative: 246
Liberal Democrat: 44

Noes: 260

---

Labour: 231
Conservative: 11
Democratic Unionist Party: 7
Scottish National Party: 5
Social Democratic & Labour Party: 3
Plaid Cymru: 3
Independent: 2
Green Party: 1

Clause 27 ordered to stand part of the Bill.

19:11

Proceedings interrupted (Programme Order, 3 September).

The Chair put forthwith the Questions necessary for the disposal of the business to be concluded at that time (Standing Order No. 38D).

Clause 28

Constituency limits

Question put, That the clause stand part of the Bill.

19:11

Division 83

Ayes: 293

---

Conservative: 248
Liberal Democrat: 43
Independent: 1

Noes: 248

---

Labour: 229
Democratic Unionist Party: 7
Scottish National Party: 5
Social Democratic & Labour Party: 3
Plaid Cymru: 3
Conservative: 2
Independent: 1
Green Party: 1

Clause 28 ordered to stand part of the Bill.

Clause 29

Targeted expenditure limits

Amendments made: 86, page 22, line 5, leave out ‘or the recognised third party’.

Amendment 87, page 22, line 18, leave out ‘or the recognised third party’.—(Tom Brake.)

Clause 29, as amended, ordered to stand part of the Bill.

Clauses 30 and 31 ordered to stand part of the Bill.

Clause 32

Reporting of donations to recognised third parties

Amendments made: 88, page 29, line 11, after ‘section’ insert ‘in relation to a recognised third party’.

Amendment 89, page 29, line 12, after ‘section 58’ insert ‘in relation to a registered party’.

Amendment 90, page 30, line 39, leave out ‘3(3)’ and insert ‘3(3)(c)’.—(Tom Brake.)

Clause 32, as amended, ordered to stand part of the Bill.

Schedule 4 agreed to.

Clauses 33 to 35 ordered to stand part of the Bill.

The occupant of the Chair left the Chair, (Programme Order, 3 September).

The Deputy Speaker resumed the Chair.

Progress reported; Committee to sit again tomorrow.

Business without Debate

Tuesday 10th September 2013 Commons Chamber

Delegated Legislation

Motion made, and Question put forthwith (Standing Order No. 118(6)),

Pensions

That the draft Occupational and Personal Pension Schemes (Automatic Enrolment) (Amendment) Regulations 2013, which were laid before this House on 1 July, be approved.—(Anne Milton.)

Question agreed to.

Petitions

Tuesday 10th September 2013 Commons Chamber

19:25

[Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)]

The petition states:

The Petition of residents of East Cleveland,

Declares that Redcar and Cleveland Borough Council should allow Earthbeat to convert Guisborough Registry Office into a community theatre for the people of Guisborough and East Cleveland.

The Petitioners therefore request that the House of Commons urges Redcar and Cleveland Borough Council to allow Guisborough Registry Office to be converted into a community theatre.

And the Petitioners remain, etc.

[P001219]

19:26

[Graham Jones (Hyndburn) (Lab)]

The petition states:

The Petition of residents of Haslingden & Hyndburn,

Declares that seven children and two adults have been killed by dogs since 2006, and that 6,000 admissions to hospital are caused by dog attacks each year leaving many victims scarred for life; notes that the introduction of Dog Control Notices is supported by many organisations including the Kennel Club, the Dogs Trust, RSPCA, Royal College of Nursing, British Veterinary Association and the Communication Workers Union; and believes that the Government’s current proposals on dangerous dogs do not go far enough.

The Petitioners therefore request that the House of Commons urges the Government to amend the law to cover attacks on people and animals on both private and public property, to enforce Dog Control Orders, to introduce Dog Control Notices giving the authorities the power to intervene, to introduce the compulsory micro-chipping of all dogs and to promote responsible dog ownership, including training owners and dogs.

And the Petitioners remain, etc.

[P001220]

Blanefield (Landfill Tax Liability)

Tuesday 10th September 2013 Commons Chamber

Motion made, and Question proposed, That this House do now adjourn.—(Anne Milton.)

19:28

[Mrs Anne McGuire (Stirling) (Lab)]

I am grateful for the opportunity to raise my concerns about the application of the landfill tax across the UK to cases in which, due to time elapsed and the lack of any responsible polluter, the burden of liability for contaminated land remediation costs, plus landfill tax and value added tax, falls on the occupier of that land. The incidence of contaminated land across the UK is apparently wide scale with limited public funds available to assist businesses and residential occupiers who find themselves bearing the considerable burden of such costs where they are at no fault in the creation of the contamination.

My understanding is that the landfill tax was introduced in the 1996 Budget as one of a series of measures aimed at reducing waste placed in landfill sites. Part of the aim of the tax—a laudable aim—was to tackle polluters of land that required remediation to make it safe, with a tax on top that could be used to penalise and discourage polluters. For recent instances of such contamination it may be, and often is, possible to identify and penalise the polluters, but as many sites are a legacy from this country's industrial past, the polluter has often disappeared into the mists of time.

I initiated this debate to raise the plight of 13 residents and their families who are the unfortunate victims of the landfill tax legislation. Blanefield is a village in the Stirling constituency to the north-west of Glasgow. In the 19th century it was home to a large calico printing works, which I understand at its peak may have employed 500 men, women and, given the historical time, children. With the demise of the calico printing trade at the end of that century there was overcapacity and factories like the Blanefield printworks closed down. By 1910 the last of the buildings had been demolished and the site lay dormant until the late 1950s, when a residential housing development was built on it.

Rolling forward, in 2012 a random soil analysis was carried out by the local authority and it found traces of lead and arsenic left as a legacy of the printing process. Under the Environment Act 1990 there is a responsibility on the local authority to ascertain whether land is deemed “contaminated land”. The local authority in Stirling believes, based on the scientific outcomes of its investigation of the ground and the risk assessment, that there is evidence that the land is in such a condition that it presents a “significant possibility of…harm” to human health.

In this case we are talking about a printworks demolished more than 100 years ago, and unfortunately, as you can imagine, Madam Deputy Speaker, the council has been unable to identify any party who “caused or knowingly permitted” the presence of the substances in question, because the owners of the printing works went out of business over a century ago and there is no indication of a successor company. Also, the council has no evidence that any of the developers who built the current dwelling houses on the site knew about the contamination. Part IIA of the Act provides that in the absence of a causer or knowing permitter, the liability falls on the owners or occupiers of the affected land.

Here we come to the nub of the problem for the owners of a group of 13 homes identified as owning land affected by lead and arsenic contamination. The latest estimate of the cost of remediation to these 13 gardens is over £600,000, including value added tax. Liability for the individual proprietors of the 13 gardens varies from £14,000 to £100,000.

Under the 1990 Act, statutory guidance provides that where an appropriate person of this kind owns and occupies a dwelling on the contaminated land in question, the enforcing authority should consider waiving or reducing its cost recovery where that person satisfies the authority that at the time he or she purchased the dwelling they did not know, and could not reasonably be expected to have known, that the land was adversely affected by the presence of a pollutant. It further provides that any such waiver or reduction should be to the extent needed to ensure that the person in question bears no more of the cost of remediation than it appears reasonable to impose having regard to their income, capital and outgoings.

The Library has clarified for me that although the 1990 Act regulates contaminated land remediation, environmental issues, as the Minister will no doubt tell me, are devolved to the Scottish Government. I am advised, though, that contaminated land soil was originally exempt from the landfill tax. However, that exemption was phased out in 1998 due to concerns that soil was not being cleaned, but simply landfilled. I understand that until 2008 land remediation specialist companies did not have to pay landfill tax when they disposed of contaminated soils. But the Government argued that this exemption encouraged remediators to take the easy “dig and dump” route, rather than follow a more sustainable option, cleaning and reusing soil. They then announced that they would end the exemption for the contaminated sites, although the Government promised that any money they received would be reinvested through an expansion of existing rebates for remediation. These arrangements appear to apply only to companies and not to individuals who find themselves liable to pay the landfill tax for remediation of contaminated soil.

Given that the implementation of land remediation is now a devolved issue—I am sure the Minister will expect me to recognise that, but his time will come after my contribution—I am aware that the funding to mitigate the remediation costs of individuals and residents such as those on the Blanefield site in Scotland is available via Scottish budgets. In 2008 the previous Scottish Executive set up a contaminated land grant fund of £17 million available to Scottish local authorities. The new Scottish Government did not continue this fund but instead, under their single outcome agreements with local authorities, included a sum to allow them to take responsibility for funding in such situations. In the Blanefield case Stirling council has made available a sum of £125,000 towards the remedial works needed.

Aside from this substantial liability for residents, matters are exacerbated by their liability for landfill tax and value added tax levied on residents. These taxes remain reserved to the Treasury. Although they will be devolved to the Scottish Parliament, that devolution will not take place until 2015, so this is very much an issue for those currently on the Treasury Bench. I hope the Minister will agree that it could not have been the intention of Government when introducing the landfill tax in 1996 or in 2000, when some changes were brought in, to impose such a draconian burden on residents who inherited a remediation bill.

In the Blanefield case the local authority has come forward with the likely costs of the remediation work plus landfill tax and VAT. This works out to a total of £633,000 for the 13 affected residents. We do not need a calculator to work out what the burden on individual residents would be. Even taking into account the council grant of £125,000, this leaves the residents liable for £483,000. Individual liability ranges from £11,000 up to £79,000. Astonishingly—I hope the Minister will accept this—the landfill tax element of these bills forms up to 61% of the remediation costs for some individuals. With the addition of VAT that element rises to 79% of the total burden being placed on my 13 constituents.

At this point I feel it is relevant to show the impact of the imposition of landfill tax on the 13 residents affected. Many of the residents are approaching retirement, have retired or have families, and the spectre of this potential burden on them is the cause of a range of stress-related deteriorating health problems. One resident commented to me that

“everyday major financial decisions cannot be made without the spectre of this financial liability hanging over us”.

Another commented that his wife is a keen gardener and knowing that the garden that she has tended and cared for will be destroyed in the near future is hard to take. So it is not just a financial issue for some of those involved.

A repeated concern expressed by residents is that their properties are worth considerably less or nothing due to these remediation costs, a situation that is particularly galling as the landfill tax and VAT elements are such a major component of their bills. So that the Minister does not think that I am exaggerating, I want to give him just a couple of examples. At one house the works cost £6,158 and the total cost without the council grant is £14, 855. The landfill tax plus VAT represents 59% of that. If we take into account the Stirling council grant, the same house will have a reduced burden of £10,996, but the percentage of the landfill tax and VAT will be 73% of the total bill. In another case, at the other end of the spectrum, a bill that starts out at around £42,000 rises to £79,319, 78% of which is for the landfill tax and VAT. Therefore, there is a significant financial burden.

Another resident told me that they used all their savings to buy their property in Blanefield. Given the blight that the contamination places on the properties, that means real difficulties for them and anyone who might wish to purchase their house in future, because mortgage companies will not lend funds against the property.

What comes over strongly in the representations I have received from residents is that they are innocent victims of a polluter that existed over 100 years ago. Although the remediation costs alone, less the assistance offered by the local authority, could possibly be managed, the additional burden of the landfill tax and VAT takes it beyond their means. For that reason, I ask the Minister to look again at my previous request, outlined in my letter of 24 June, for the landfill tax and possibly the VAT elements in this case to be waived.

The Minister will know that I wrote to him subsequently in August seeking a meeting to discuss the situation. I am still awaiting a response to that request, but the burden on my constituents is so great that I thought it appropriate to raise the matter on the Floor of the House in an Adjournment debate. In his reply of 19 July, he pointed out the involvement of Stirling council and stated that

“he hopes they will consider any additional hardship in accordance with the Statutory Guidance”.

I trust that, in taking on the concerns I have raised in this short debate, he will acknowledge that the burden on my constituents, which I am seeking to ameliorate, is a substantial landfill tax and the associated VAT, which is not, and should not be, the responsibility of either the local authority or the Scottish Parliament; it is quite firmly the responsibility of Her Majesty’s Treasury.

In the meantime, as well as reconsidering a waiver—I hope that he will—perhaps the Minister will look at the option of working with the local authority to mitigate the costs of the landfill tax and the VAT. That way, the Treasury would need to deal with only one agency, rather than 13 individual residents. Alternatively, it could be managed through the links with the Scottish Government. I hope that he will be flexible enough in looking at ways that this could be managed. I hope he will not give me a message tonight about precedent and how difficult it is, because I think that he might be able to find ways of dealing with it.

My constituents have been in limbo since they discovered that their land was affected, with their properties and their lives effectively blighted. As I stated earlier, I cannot believe that any Government, either of my party or the Minister’s, ever intended the landfill tax to impact on individuals in the way it has for the 13 Blanefield residents in my constituency. I hope that he will look at the case again and take action in whatever way he deems appropriate to help them by raising the burden of the landfill tax and VAT, which create the bulk of their liability. I look forward to his response, but I say to him that where there is a will there is a way, and the Treasury is expert in finding a way. I hope that he will be able to find a way tonight to help my 13 constituents who are facing a burden that they never expected.

19:44

[The Economic Secretary to the Treasury (Sajid Javid)]

I congratulate the right hon. Member for Stirling (Mrs McGuire) on securing the debate and representing her constituents with such passion and eloquence. The households she has referred to have come into very difficult circumstances though no fault of their own, as she has said. I am sure that every Member present can appreciate the pressures and stress that the situation is causing everyone involved. It is absolutely right that the right hon. Lady has brought this issue to the Chamber’s attention and allowed us to give it the consideration it deserves.

I will begin by reiterating some of the facts of the case. I will then provide some further background about the current legislation in this area. Finally, I will suggest what I believe is the best course of action for the right hon. Lady and her constituents.

As the right hon. Lady has explained, the residents under discussion live in properties that were built on the grounds of a former Victorian printworks. Following a recent inspection by the Scottish Environment Protection Agency, the land on which those properties were built has been deemed contaminated. The law now requires that this land be remediated.

As the right hon. Lady has explained, the liability for that remediation is laid out in the contaminated land regime. In the first instance, it is right that the polluter will be held liable to cover the cost of remediation. However, as we have heard, in this instance the original polluter—namely the Victorian printworks—is no longer in existence. In the absence of the original polluter, the responsibility for carrying out the remediation works, under the Environmental Protection Act 1990, falls to the current landowner.

It is worth making it clear that in about 90% of cases involving contaminated land, the land will be remediated when the site is redeveloped for future use, as stipulated under planning policy. In most instances, the liability will fall on a company or business, which will be better placed to cover the costs of remediation. In the small percentage of remaining cases, however, the costs of remediating the land will fall on owner-occupiers.

Of course, in most circumstances the value of the land will rise once it has been decontaminated. In this respect, the logic of the law is to ensure that the landowner, who will be set to gain from the increase in the value of the land, should also be the person liable for the costs of the clean-up. Unfortunately, in the instance under discussion, this means that the liability is set to fall on 13 households, to which absolutely no blame can be attached.

As the right hon. Lady will be aware, the landfill tax aims to reduce the environmental damage caused by sending waste to landfill. In increasing the cost of landfill, the tax also aims to encourage more sustainable waste technologies, such as recycling. At a national level the tax has been successful in achieving those goals. Waste material is increasingly being diverted away from landfill towards reuse or recycling. The tax has also been successful in ensuring that the environmental damage associated with the disposal of such waste is properly reflected in the landfill price.

As the right hon. Lady acknowledges, the tax is designed to ensure that the polluter pays, and she is right to point out that in this particular instance the original polluter will not be paying. I am sympathetic to the argument. However, it will not be possible for the contaminated waste in this instance to be exempt from landfill tax, as the right hon. Lady proposes. It may be useful, in explaining why such action is not possible, to set out how the landfill tax currently operates.

Under the current system, the tax liability falls on the landfill operator, not the person delivering the waste. Those landfill operators must check the content of the waste to determine what rate of tax to apply. There is, however, no requirement on the site operator to satisfy themselves as to the origin of the waste or the type of business, local authority or private individual that has delivered it to them. Therefore, introducing an exemption, as requested, would require a fundamental change to the structure of the tax. It would also place an excessive future burden on all landfill operators, who would be forced to check and verify the origin of each item of waste that had been sent for disposal at their site.

It is also worth remembering that a change such as that suggested by the right hon. Lady would be legislatively complex. It would require amendments to primary legislation. That would mean, first, that it could not be made with the haste required for the right hon. Lady’s constituents to benefit; and secondly, that it could create a more complex law on landfill. As hon. Members will unfortunately be only too well aware, complexity in any tax can increase the opportunity for evasion. While she has suggested changes to the current legislation, for wholly the right reasons, certain unscrupulous individuals or businesses may well seek to use such an exemption for wholly the wrong reasons to reduce their own tax liabilities. So while I acknowledge and sympathise with the real difficulties that these households, in particular, are facing, it would be extremely difficult for the Government to alter national policy to benefit her constituents without creating unintended issues for landfill policy as a whole.

I therefore believe that this is an issue that would be best resolved at a local level. As the right hon. Lady may know, the national legislation sets out the framework that explains how responsibility for covering the costs of remediation should work and how they are determined. As she said, it is the local authority’s responsibility to apportion the liability. It is my understanding that in this instance the issue of determining who should bear responsibility for remediation of the land was performed by Stirling council’s legal services department.

[Mrs McGuire]

I do not think that anybody is disputing the role of the local authority in this. It has carried out that role and within its responsibilities it has made a substantial and significant contribution to the costs. The issue that I wish to raise with the Minister lies directly within his jurisdiction. It is about the liability of individuals to bear the responsibility of this—an unintended consequence of previous legislation. I would have hoped that he would be able to be creative in thinking of ways in which these individuals would not have to be liable.

[Sajid Javid]

I can assure the right hon. Lady that I have looked at this very carefully. She will already have heard some of the reasons why it is extremely difficult to make such a change, even if it were desired, because it would require a change in primary legislation within the time needed to benefit these individuals.

I understand that, as the right hon. Lady said, Stirling council has put forward a £125,000 grant towards the remediation costs. I also understand that it has promised to consider any additional hardship in accordance with the statutory guidance. On top of that, my officials at the Treasury have recently been in touch with their equivalents at Stirling council, and it is their understanding that loans secured against the property’s resale value may also be offered to affected households. I therefore urge the right hon. Lady to continue to pursue this issue with Stirling council on behalf of her constituents. I have asked my officials to explore what additional support the local authority may be able to provide. She asked whether I would meet her to discuss this issue in further detail, and of course I would be happy to do so.

I completely understand the right hon. Lady’s frustration about this issue, and I entirely sympathise with all the households involved. This is not a situation that any home owner would want to go through, nor one that any hon. Member would want any of their constituents to go through.

I hope that both the right hon. Lady and the home owners involved will understand why I do not believe that an intervention at national level is the answer. I also hope that with her help, and that of the local authority and Treasury officials, those home owners will be able to resolve the issue locally.

Question put and agreed to.

19:55

House adjourned.