Second Reading Committee
The Deputy Chairman of Committees (Lord Skelmersdale) (Con)
My Lords, since there are no votes in the Chamber today, I can dispense with the normal rigmarole. However, I have a new piece of rigmarole to put before your Lordships. Before the Minister moves that the Bill be considered, I remind noble Lords that the Motion before the Committee will be that the Committee do consider the Bill. I should perhaps make it clear that the Motion to give the Bill a Second Reading will be moved in the Chamber in the usual way.
Inheritance and Trustees’ Powers Bill [HL]
(11 years ago)
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The Minister of State, Ministry of Justice (Lord McNally) (LD)
My Lords, it gives me great pleasure to introduce this Bill and to remind the Committee that we have had the invaluable help of Professor Elizabeth Cooke of the Law Commission, the law commissioner who led on the initial Law Commission project. I am a great supporter of the House using its powers in this area to get Law Commission reports into law. There was a period when, for far too long, they gathered dust on the shelves. The process that we have adopted enables us to do some useful work. We are always very grateful to the noble and learned Lord, Lord Lloyd, for volunteering to chair proceedings on these Bills.
The Inheritance and Trustees’ Powers Bill is a fairly short but technical Bill to amend certain aspects of the law of England and Wales as it relates to inheritance and trustees’ statutory powers. The fundamental issue at the heart of much of the Bill—arrangements for disposing of a person’s property after their death—is not one that many of us relish engaging in. It brings unwelcome thoughts of our own mortality. However, these issues must be faced by most of us in some form during our lifetime. In an ideal world such arrangements would be set out in a will—and I repeat that as the first message from this Committee: in an ideal world, the most sensible thing that individuals can do is set out their intentions in a will. However, we do not live in an ideal world. Many people, for one reason or another, do not leave such a document. It is only right that the law, in the form of the intestacy rules, makes appropriate and fair provision for the disposal of their property.
I know that several noble Lords present today have had the advantage of attending the briefing on the Bill by Professor Cooke which we held last week. The Government are very grateful to the Law Commission for the help that it has given in the preparation of the Bill for introduction and its continuing support for the Bill as it goes through Parliament.
The Bill will implement, with some modifications, the legislative reforms recommended by the Law Commission in its 2011 report Inheritance and Family Provision Claims on Death. The project that culminated in that report was prompted by a 2005 government consultation on increases to the statutory legacy. Responses to that consultation included calls for a wider review of intestacy rules with almost all consultees agreeing that such a review was necessary. The Law Commission was asked to examine this area of the law and duly published a consultation paper in 2009, followed by the report, which was accompanied by a draft Bill, in 2011. The Ministry of Justice then carried out a public consultation on the draft Bill earlier this year and then published a response in July, explaining the changes it proposed to make to the Bill. This extended and comprehensive consultation process has resulted in a measure that I believe has broad support and is suitable for the Law Commission procedure in your Lordships’ House.
Noble Lords will be aware that the Law Commission’s previous work in this area included recommendations regarding rights for cohabiting couples on intestacy. The Government decided that it would not be appropriate to take these proposals forward in the Bill now before us. Indeed, the Law Commission recognises that its work on cohabitation raised issues that do not apply to the Bill. The issue of legal rights for cohabiting couples is complex and potentially far-reaching. I believe that there is already more than enough to occupy this House in the Bill as it stands. In addition, the family justice system is already in the middle of a comprehensive reform programme and I do not believe that it would be wise to consider further reform in this area until that process is complete.
The first seven clauses of the Bill deal with two aspects of the law on inheritance: the intestacy rules and family provision. The former dictate the division of property when a person dies without leaving a will. The latter permits certain family members and dependants to apply to the court to vary the distribution of a deceased person’s property, whether that is under the intestacy rules or the terms of a valid will. The Bill will streamline and modernise the intestacy rules, reducing the cost of administering intestate estates and bringing them into line with public expectations. It will also correct some technical deficiencies in the operation of the family provision legislation.
Clause 1 amends Section 46 of the Administration of Estates Act 1925 and, most importantly, makes changes to the entitlement of a surviving spouse or civil partner of a person who dies intestate. The Bill proposes that in a situation where the intestate leaves no children or other direct descendants, the surviving spouse or civil partner will be the sole beneficiary of the estate. This changes the current law under which a surviving parent or full sibling or sibling’s issue is entitled to share whatever is left in the estate after the spouse or civil partner has received the deceased person’s chattels and what is commonly called the “statutory legacy”—in this case, the first £450,000 of the estate. This brings this part of the intestacy rules into line with public expectations. Empirical research has shown that the majority of people favour giving priority to a surviving spouse.
Clause 1 also proposes that where the intestate does leave children or other descendants, the surviving spouse or civil partner is absolutely entitled to the deceased’s personal chattels, a statutory legacy of £250,000 and half of whatever remains of the estate. The other half of the remainder will be shared between the children and other descendants. Under the current law, a surviving spouse or civil partner is only entitled to a life interest in his or her half of the remaining estate. Life interest trusts can be a source of confusion and cost, often for only marginal gain, and the Bill removes them.
Finally, Clause 1 makes several technical changes to the rate of interest which accrues from the date of death of the intestate on the statutory legacy. Clause 1 simplifies the sharing of assets on intestacy in a way that is fair to those who have been closest to the deceased: the surviving spouse or civil partner and any children or their children. Our aim here is to ensure that spouses and civil partners are appropriately provided for. By focusing solely on those closest to the deceased, we aim to simplify the current law on intestacy so that it can better reflect the arrangements that an individual is likely to have made had he or she executed a valid will.
It is impossible to design intestacy rules which satisfy every view of what is right or fair. The rules stand as a legal default position. They should reflect the shape of contemporary society and replicate what most people think is an appropriate division between family members. The changes in the Bill are intended to reflect real-life expectations of what provisions the intestacy rules should make.
Clause 2 and Schedule 1 make a number of changes to the way in which the statutory legacy, or fixed net sum as it is more properly called, is determined. Under the Bill, this sum is, of course, the amount to which a surviving spouse or civil partner will be entitled where the intestate deceased has also left children or other descendants. The most important of these changes impose a new requirement on the Lord Chancellor. At present, the Lord Chancellor has the power to set the level of the statutory legacy but is under no obligation to do so or to keep the level under review. The Bill proposes to change this state of affairs by requiring the Lord Chancellor to make an order setting the level of the statutory legacy at least every five years. As to the actual level to be set, the Bill provides that, unless the Lord Chancellor determines otherwise, the level should be set according to a procedure specified in legislation. The procedure will index link the statutory legacy by increasing it by an amount that reflects any increase in the consumer prices index measure of economic inflation. The legacy can therefore only increase; in the event of no inflation or deflation, the level of the legacy will not change.
Clause 2 enables the Lord Chancellor to set the level of the statutory legacy without using this index-linking mechanism such that he is at liberty to set a level that is equal to or even lower than the pre-existing figure. However, in such circumstances, he will be required to report to Parliament to explain why the mechanism has not been used. These provisions create a legislative framework that will govern the level of the statutory legacy and will ensure that it does not slip behind inflation and lose its real-world value. The changes will benefit surviving spouses and civil partners.
Clause 3 deals with the statutory definition of personal chattels. Under the current law on intestacy, a surviving spouse or civil partner is entitled to all the deceased’s personal chattels that are not otherwise disposed of under a will. The Bill does not change that but it does propose to amend and update how these chattels are defined. Personal chattels are defined in the Bill as “tangible movable property”, replacing an anachronistic and arbitrary list of property and categories of property in the current law. The Bill also includes three defined exceptions to this definition.
The first is money and securities for money. This is not new. The second exception is for property used, at the death of the intestate,
“solely or mainly for business purposes”.
The words “solely or mainly” are new and will ensure that property—for example, a vehicle such as a van that was regularly used in the course of a business—would be excluded from the definition. The third exception is wholly new and relates to property which is held, at the death of the intestate, solely as an investment. This is a narrow exception that would only apply to property owned as an investment and which had no personal use whatever. For example, valuable jewellery which was worn by an individual, even if only occasionally, would still qualify as a personal chattel and would pass to the surviving spouse or civil partner, even if it was also bought and kept in the expectation that its value would increase.
The remainder of Clause 3 provides that where personal chattels are referred to in a will or a codicil to a will, the current pre-Bill definition of personal chattels will be used if the will itself is executed before Clause 3 comes into force. This will be the case even where a codicil is made after the date that Clause 3 takes effect. However, it is also still open to the person making the will or codicil to expressly state that the new definition of personal chattels should apply.
Clause 4 seeks to protect the position of children who are adopted after the death of a parent. The general rule in these matters is that after adoption, a child is regarded as the legal child of the adoptive parents and has no other legal parents. However, Clause 4 ensures that a child whose parent has already died before the adoption takes place will not lose, as a result of adoption, a contingent interest that he or she already holds in the estate of the deceased parent. This provision is relevant where a child is adopted, perhaps by other members of his or her family, as a result of the birth parents’ death. Adoption in these circumstances is typically open, involving no secrecy. The child has been tragically orphaned, and an aunt, uncle or other relative adopts the child. No one intended, in that situation, that the orphaned child should lose his parents’ estate; yet that is what will happen in cases where inheritance—as a matter of sensible estate planning—is contingent on the child reaching a particular age.
It is important to note that this provision affects only children who are adopted after the death of a birth parent. I believe that this is an important distinction and it is right that the law preserves the rights of children who, at the date of the adoption, already hold a contingent interest in the estate of their birth parents. The law already preserves vested interests held by a child at the point of adoption and ensures that those interests are not lost. Clause 4 simply adds contingent interests into that existing provision. It is wrong that the law can strip away a child’s inheritance simply because she has been adopted. Clause 4 will correct that injustice.
Clause 5 proposes to disapply Section 18(2) of the Family Law Reform Act 1987 in certain circumstances. This section provides that where a person dies intestate and his parents were not married to each other at the time of his birth, the administrators of his estate may presume that he was predeceased by his father and any other person to whom he may be related only by virtue of his father. In the case of a person who has a female parent other than his mother as a result of Section 43 of the Human Fertilisation and Embryology Act 2008, his administrators may presume that he was not survived by this second female parent or by anyone related to him through this parent. This is a pragmatic rule which derives from a time when it was common for the identity of the father of a child born out of marriage to be unknown. Tracking such parents down could present real difficulties to those administering intestate estates. The rule discriminates against unmarried fathers and, in practice, can make it less likely that the deceased’s estate will pass under the intestacy rules to such a parent. Nowadays, it is quite usual for both unmarried parents to be identified as such, and the practical justification for the rule is much reduced.
Clause 5 disapplies this presumption if a person is recorded as the intestate’s father or as a parent other than his mother in a specified formal register of births. In such a case, the estate’s administrators will have the same responsibility to the deceased’s father or other parent as they would to any other relative entitled under the intestacy rules. This amendment clarifies that where such a parent has been formally acknowledged as such, irrespective of the absence of a marriage certificate, that parent should, in general, have the same rights as his married counterpart.
Clause 6 amends various provisions in the Inheritance (Provision for Family and Dependants) Act 1975 by way of Schedule 2. Noble Lords will know that it was formerly the Government’s intention to create an additional ground of jurisdiction for family provision claims in this Bill. This was to enable claimants who were habitually resident in England and Wales to bring such a claim, regardless of the deceased’s place of domicile. Scottish Government colleagues have raised significant concerns about how this additional ground would operate in practice, particularly its potential to displace Scots law to the possible detriment of those who had inheritance rights under that law. We have carefully considered these concerns from our colleagues across the border. I do not now believe that it is possible to engineer a compromise on this point that would answer these concerns and retain the benefits of our original proposal. I am also aware that there has been a previous lack of consensus on the nature of the additional ground of jurisdiction—the relevant provision is at variance with both the Law Commission’s original proposal and the majority view expressed in response to the Government’s public consultation.
On that basis, my intention is to bring forward an amendment to the Bill prior to consideration by the Public Bill Committee which will delete the additional ground of jurisdiction in its entirety. I hope that, by doing so, parliamentary consideration can be better focused on the Bill’s other, equally important and worthwhile provisions.
The first of the remaining changes to the procedure for family provision claims is to extend one of the categories of person who can apply to the court for adequate provision from a deceased’s estate, whether distributed by will or intestacy. We wish to clarify that a “child of the family”—not a biological or adopted child, but a person who was treated as such—should now be understood by reference to any family in which the deceased had a parental role. Such a family need consist only of the deceased and the potential applicant. Currently, such an individual could bring a family provision claim only if they could prove themselves to be a child of the family in relation to the deceased’s marriage or civil partnership. This provision reflects the Bill’s attempts to modernise the law of succession to better reflect the realities of modern family life, and ensures that a claim by a deserving child will no longer be barred simply on the basis of the status of his or her parents.
Clause 6 also amends the wording of the 1975 Act, which defines a person who may make a family provision claim because they are considered to be a dependant of the deceased. The interpretation of the current law requires that when deciding such status, the court must balance the deceased’s contribution towards the applicant’s needs against any benefits flowing the other way. If the applicant is found to have contributed more to the deceased than vice versa, the applicant cannot be deemed to be a dependant. The Bill proposes to remove the “balance sheet test” while preserving the other, fairly strict requirements imposed on a person applying for family provision as a dependant. This reflects the important understanding that “dependency” can be mutual, and its benefits need not all, or largely, flow one way.
The remainder of Clause 6 makes a number of fairly technical changes to the procedure for family provision claims. I do not propose to set these out individually, but they include changes to arrangements governing a court’s power to make an order following a successful claim and changes to the way in which the net estate of the deceased is calculated. These changes, though technical in nature, have a significant practical effect and form part of a package of changes designed to modernise and generally improve the current arrangements for family provision claims.
Clause 7 makes various amendments to provisions which require certain types of grant to be left out of account when one is determining the date when representation with respect to the estate of a deceased person was first taken out. These are important changes, but technical, and they will be relevant in only a minority of cases. Again, I do not propose to go through each in detail. There is some uncertainty under the current law as to which grants start time running for these purposes and others and which do not. Clause 7, by way of Schedule 3, aims to clarify these uncertainties by replacing all the current provisions in this area with provisions that clearly and comprehensively set out which grants start time running and which do not.
Clauses 8 to 10 deal with trustees’ powers. Clause 8 concerns a situation where a trustee is able to use income from a trust for the maintenance, education or benefit of a beneficiary who is under 18. The Bill proposes that the amount of income that can be used for such purposes should be a matter entirely for the trustees’ discretion. Currently, an objective test of reasonableness is applied, together with a proviso listing factors that the trustees must consider—for example, a beneficiary’s age—and a specific restriction on the amount that can be paid out. These requirements are not necessary. They are sterile technical burdens and are commonly written out when trusts are professionally drafted. Clause 8 removes them. Given that the trustees must still comply with their fiduciary duties, the reform presents no threat to the interests of beneficiaries. It is right that trustees should in future be able to exercise their discretion flexibly and free from unnecessary restrictions.
Clause 9 deals with a similar situation in which trustees are able to use their power of advancement to make payments of capital to beneficiaries where this is thought necessary. Currently, such payments are limited to one-half of a beneficiary’s future share. The Bill removes this limit so that trustees could, if they think fit, pay out the whole of a beneficiary’s share under this power of advancement. This gives the trustees the flexibility that they would almost certainly be given if they were acting under a professionally drafted will or trust. It has no effect on their fiduciary duty to act in a beneficiary’s best interest, which is imposed by the general law. However, any such payments may still not amount to more than that beneficiary’s future share. Clause 10 sets out, in some detail, transitional arrangements for Clauses 8 and 9.
That concludes my brief description of the substantive provisions of the Bill. The Bill will modernise and simplify the law in a number of areas for the benefit of many people at particularly difficult times of their lives. It is a technical piece of law but no less important for that.
Finally, I must add, as I have done in introductions to previous Bills of this nature, that a Bill such as this demonstrates the importance of having a body like the Law Commission that can prepare expert recommendations for reform of the law in areas that would otherwise remain unchanged and possibly out of date. The Bill also demonstrates the advantages of having in your Lordships’ House this procedure that allows appropriate Law Commission Bills to be scrutinised as far as possible off the Floor of the House. This is the sixth Bill to be introduced under that procedure and I commend it to the Committee.
Lord Henley (Con)
My Lords, I thank my noble friend Lord McNally for introducing the Bill in such a comprehensive manner. In my innocence, I thought that this was a relatively simple Bill that was not going to cause us too many problems. However, I was naive in that approach, and I suspect that when we get into proper Committee, Report and the other stages of the Bill under the Law Commission Bill procedure, we might have to spend slightly more time on it than I originally thought.
I also thank my noble friend for arranging our meeting last week with Professor Cooke and the Law Commission, which was very useful. It helped us to get some understanding of the Bill and explained to us some of the problems. However, having listened to my noble friend’s opening speech, I wonder if we did not spend quite as much time on it as perhaps we should have.
The important point, as my noble friend made clear, is that the Bill deals largely with intestacy. He said, “In an ideal world, such arrangements would be set out in a will”. I would remind the Committee of what I am told is a convention among Quakers. Once a year they say to each other not just, “Have you got a will?”, but, “Have you got an up-to-date will?”. There is no point in having a will if that will no longer reflects your views. Similarly, it is a fairly bad thing if you do not have a will at all. So we all want to see people taking the trouble to make sure that they have a will so that large parts of the Bill need not come into effect, other than those parts that refer to looking after dependants who quite rightly should be allowed to get something if the will has excluded them.
I am very grateful, as well as for that remark from the Quakers, for a quotation sent to me by the Law Commission. It is from Cato the Elder, as quoted by Plutarch. I am going to give it in English, not in Latin—the noble Lord, Lord Beecham, can probably translate it back. He said:
“And as for repentance, he said he had indulged in it but thrice in his whole life: once when he entrusted a secret to his wife; once when he paid a ship’s fare to a place instead of walking thither; and once when he remained intestate a whole day”.
I think that it is important that everyone remembers the importance of making a will and making sure that that will is kept up to date, and for that I am grateful to my noble friend.
As one who believes in property and the freedom of testation, I am also grateful to my noble friend for covering another matter at the meeting that we had last week, and that is the fact that, other than that it makes provision for dependants, the Bill does not impinge at all on that freedom of testation. Obviously there has to be some protection for individuals, for partners, spouses and others, but I still believe that it is right that everyone should have the right, subject to what they own and whether there are trusts and others, to leave their property as and how they wish; whether it be to the cats’ home, to a political party or to their own children or whatever. I make that point because I think that it is important that we all remember that freedom of testation is a very important part of everything that we believe in in this country.
Sadly, some people will die intestate and therefore there is a necessity for rules in this area. It is a long time since I did my Bar exams and I cannot remember what the precise rules were, but having looked through the Bill, it seems to make a pretty good fist of allocating those resources on the occasions when there is a spouse or a spouse and dependants. However, there is something that I cannot quite see. The first question I want to put to my noble friend—again, I am grateful for the diagram that he provided at last week’s meeting which set out the rules before and after reform—is whether I am right in thinking that for those estates where there is no surviving spouse or children, the rules continue as they were. I cannot remember the precise details of these, but those who are more learned in law will no doubt be able to advise us. So my first question concerns intestate estates where there is a surviving spouse, civil partner or children.
My second question relates to the fixed net sum, as set out in Clause 1. There seems to be an indication that this is going to be set at around £450,000, that the Lord Chancellor will have the power to amend it and that he will have to look at it at least every five years. However, I think that we would all be very grateful if my noble friend could say a bit more about the thinking behind that sum—how they selected it and what they think is likely to happen in the future. Having said that, I would be grateful for some statistics on how many intestate estates have more than £450,000 in the bag. I suspect that it is a pretty small number, because I think that most people who have assets of that sort will have taken the trouble to take some advice. I might be wrong in that, but I would grateful to know from my noble friend just what the statistics say.
The third question I want to put to my noble friend relates to the changing definition of chattels. I listened very carefully to what he said about jewellery and whether it was something that had been, say, worn by the spouse and was therefore part of her property rather than some other asset. I have some small personal experience of this and have to say that I see trouble ahead. It is an issue that might be worth exploring in greater detail on a later occasion.
The last point—I want to be relatively brief in this—is about procedure. I understand that this is the fifth or sixth Law Commission Bill that we have had since the procedure was agreed, and I think that most noble Lords will agree that it has worked pretty well. I remember being involved in the first one that we ever had; it was of such a technical nature that I do not think I understood a word of it from beginning to end, but there were wiser people than me in the Room on that occasion. All I want is an assurance from the Government that they will ensure that this procedure is used only for uncontroversial Bills of the sort that are appropriate, as set out by the Procedure Committee. This is an area where we do not want to see any drift or growth in how these matters work.
I hope that I have been appropriately brief. There are a number of questions for my noble friend and I look forward to later stages of the Bill in due course.
Lord Wills (Lab)
My Lords, I, too, congratulate the Minister on his magisterial introduction to the Bill, which I welcome. I also congratulate the Law Commission on the quality of its work, which laid the foundations for the Bill. I am delighted to see this procedure in place for ensuring that Law Commission reports do not, as the noble Lord, Lord McNally, said, gather dust on the shelves. As a Minister in the previous Government, I was responsible for putting in place this long-overdue reform of process. It is good to see it working so well and to see all the excellent work that is done by the Law Commission, in this area as in many others, being given practical effect in this way.
The Law Commission’s work in this area set out to ensure that the intestacy rules,
“strive to reflect the needs and expectations of modern families”.
Behind that work and behind the Bill lies the imperative of ensuring an equitable distribution of the estate of the deceased. Underpinning that must be the need for such distribution to reflect, as far as possible, the wishes of the deceased. Society must strive to protect the delivery of such wishes—it is a debt that each generation owes its predecessors.
The changing nature of modern families has created a situation where such protections can be illegitimately thwarted. The Bill offers a rare legislative opportunity to mitigate such mischief. That mischief can arise, in particular, in the case of vulnerable, lonely and elderly people, where an enduring or lasting power of attorney has been granted and the attorney abuses their powers to plunder the assets over which they have power. The official line of defence against such abuse is the Office of the Public Guardian but informal lines of defence are also provided by family and friends and by those who might legitimately expect to be beneficiaries of the estate in due course.
However, these defences can be of little value in the cases—which are, sadly, increasingly common—of vulnerable elderly people without close family or friends to monitor their situation. It is impossible to know how prevalent a problem this is because it is, by its nature, often concealed. However, because it is concealed, the Office of the Public Guardian can often do nothing about such abuse. Even when it does come to light, it is often after the death of the person concerned, and the Office of the Public Guardian has no jurisdiction after death.
The mischief can also arise even when no power of attorney has been granted but when there is a fiduciary relationship. The problems here can extend beyond the obvious one where the person drawing up the will becomes a beneficiary of it.
For example—and I set out this example solely to illustrate the nature of the problem—an elderly person, perhaps in a care home, asks for advice on making a will and the care home refers them to a local solicitor. In drawing up the will, the solicitor and the elderly person strike up a close relationship. The solicitor begins to pay regular visits to discuss the will and other matters. The solicitor might, quite properly, point out that they need to charge for the visit, and the elderly person, glad of the company, is glad to agree. However, the elderly person may not be aware that the solicitor is visiting far more often than could be justified professionally and that, instead of charging a normal hourly fee, they might be charging double that and then paying themselves those fees out of the estate that they are administering.
It might be argued—and I think that the noble Lord, Lord Henley, would agree with me on this given what he has just said—that if an elderly person wishes to spend their money on company from a solicitor or anyone else, the state has no right to interfere with that wish. That is an area where the state should not trespass. However, disproportionate charges for that solicitor’s visits and a disproportionate number of visits might, unknown to that elderly person, exhaust the estate and deprive the beneficiaries, who will often be charities, of the legacy that the testator wished them to have. If that had been fully explained to that elderly person, they might well have decided not to have quite so much company from the solicitor.
If the situation is not made clear and there is a breach of fiduciary duty, there appears to be very little remedy in practice. Again, this is by its nature often a concealed mischief and will rarely come to light. In this situation, the beneficiaries of the will, who might be expected to take a close interest in the administration of their future inheritance, are charities and will not necessarily be aware of the will.
The Solicitors Regulation Authority operates, understandably and prudentially enough, on a risk basis. It investigates only after a number of complaints, and the nature of this mischief means that a significant number of complaints are unlikely to emerge. It therefore seems that professionals—this will usually be solicitors but not necessarily exclusively so; it might involve others such as accountants and doctors—can operate to milk the estates of elderly, lonely and vulnerable people with a high probability of impunity.
This risk has been acknowledged by the Solicitors Regulation Authority, which has said:
“Theft and serious overcharging by solicitors acting in a representative capacity such as executor of an estate (but also under powers of attorney) continue to pose a high risk. The numbers of reports to the SRA of possible irregularity in probate cases increased from 6 in 2004, to 31 in 2005, 52 in 2006 and 65 in 2007. This problem is particularly insidious because it can take place over many years without detection. Beneficiaries, especially charities, are unaware that their money has been stolen. Sometimes solicitors or their employees take a long-term view by drafting wills to enable them to steal money from estates in later years”.
It is therefore clear that this problem has come across the radar of the SRA. The numbers are not great, but they may be only the tip of an iceberg. The problem is compounded by the fact that, as I understand it, if an estate is of nil value, it does not have to be published. A sufficiently calculating solicitor or other person in a position to do so can then time the plundering of the estate to such an extent that it is exhausted by the time of death. Therefore, there is no public record of the depletion of the estate. In the circumstances that I have described, there will be no close family or friends to be beneficiaries who might question the exhaustion of the estate. The charities, which are often the beneficiaries in these circumstances and which, as I understand it, scrutinise published wills to check out their legacies, will have nothing to scrutinise. Such a lack of transparency fosters a culture of impunity which can only encourage the plundering of estates of the elderly and vulnerable by those who are malignly intentioned and are in a position to do so.
There is clearly a problem here, and the Bill offers a rare legislative opportunity to tackle it, although I fully accept that the main thrust of the Bill is in a completely different area from the one that I have just described. Before the Minister decides to tell me that I may be straying too far off course here, I should say that I have sought advice from the clerks on the amendment that I intend to put down and they have advised me that what I have in mind is admissible.
Of course, no legislation can ever guarantee to remove any mischief completely, but it can often mitigate its incidence and its extent. I believe that greater transparency can do just that in this case. I tell the Minister now that I intend to put down an amendment in Committee to promote such transparency. I am very happy to share this with the Minister and his officials in advance in the hope that all their greater experience, wisdom and judgment can improve my amendment and make faster and securer progress towards tackling a problem that I hope we can all agree should be tackled.
Lord Marks of Henley-on-Thames (LD)
My Lords, I, too, welcome this Bill. As my noble friend has explained in his lucid and comprehensive introduction, it implements some of the proposals in the Law Commission’s 2011 report, Intestacy and Family Provision Claims on Death.
Particularly welcome is the improvement of the position of spouses and civil partners as compared with the position of remoter relatives. It is entirely right that where a deceased leaves a spouse or civil partner but no children, the spouse or civil partner should take the entire estate. It is also right that where there are surviving children as well as a surviving spouse or civil partner, then that survivor should take not just the statutory legacy absolutely but also his or her half of the residue absolutely. The complication and the capacity for encouraging disputes that was inherent in the existing arrangement, whereby the survivor’s half interest was held on a life interest only, should be done away with. I believe that these and other changes in the Bill chime with contemporary views of family life. They also accord more readily than do the present arrangements with the economic realities of dependency. These changes will help avoid the difficulty, the expense and the time involved in bringing claims for family provision under the 1975 Act as well.
In the case of family provision, my noble friend has stated that the Government intend to abandon the provisions presently in the Bill to reform the domicile threshold for bringing a family provision claim. Families and family wealth are increasingly international, and not only among the wealthy. I would suggest that there are cases where claims against the estate of non-domiciled deceased persons ought to be capable of being brought. It may be that habitual residence of a potential claimant is not an appropriate test for the reasons of Scots law and practice that my noble friend gave. But in this respect, as he reminded us, the provisions in the Bill differ from the Law Commission’s original proposals. The Law Commission report recommended that the existence of real property in England and Wales, or property to which domestic succession law applied, should be the alternative threshold condition apart from domicile of the deceased, whereas, as my noble friend has said, the Bill in its present form would have established habitual residence of the potential claimant as the alternative threshold condition.
I wonder whether the existence of real property here, or property to which domestic succession law applies, should, as the Law Commission proposed, even in the absence of domicile of the deceased or habitual residence of the claimant, justify a financial provision claim. I hope that the Government, rather than simply abandoning the position by amendment, will consider whether there is an alternative way of effectively widening the present threshold.
In connection with family provision claims, it is plainly right that we should add as an eligible person a child treated by a parent as a child of the family; that change is plainly welcome.
The Bill, however, implements only one part of the recommendations of the Law Commission’s 2011 report. As my noble friend also pointed out in his introduction, the other part comprised its recommendations for provision for cohabitants to take under the intestacy rules after five years’ cohabitation, or two years if the cohabitants had children living with them. Those proposals were incorporated in a separate draft Bill, the Inheritance (Cohabitants) Bill, which was annexed to the Law Commission’s report.
The Government have not sought to implement those provisions either in this Bill or in any other Bill. I differ from my noble friend and the Government in my assessment of the wisdom of this. It was left to my noble friend Lord Lester of Herne Hill to bring in a Private Member’s Bill in the terms of the Law Commission’s draft in the previous Session in an attempt to secure the implementation of these recommendations relating to cohabitation. That Bill fell for lack of time and government support after Second Reading in this House. Its provisions are now included in my Cohabitation Rights Bill, which was introduced in this House earlier this month.
The fate of those provisions is not my only concern in this area. The Law Commission in 2007 produced a lengthy and detailed report entitled, Cohabitation: The Financial Consequences of Relationship Breakdown. In that report, the commission recommended a limited scheme of financial relief to adjust economic disadvantages arising out of cohabiting relationships and to share the benefits derived from such relationships.
Again, my noble friend Lord Lester of Herne Hill introduced a Private Member’s Bill in 2008 which would have introduced reforms which were not the same as but similar to those proposed by the Law Commission. The Labour Government did not support that Private Member’s Bill, the noble and learned Baroness, Lady Scotland, then the Attorney-General, saying that the Government wished to await the outcome of research into how the Scottish legislation to similar effect, passed in 2006, was working.
In September 2011, four years after the Law Commission’s 2007 report, when I asked an Oral Question of the Government on this issue, they announced the same day by Written Ministerial Statement that there would be no action taken by the Government in this Parliament to implement the Law Commission’s proposals. Those proposals on financial relief on relationship breakdown are now the central part of my Cohabitation Rights Bill. However, in the nature of things and despite any optimism on my part, it may be some time before that passes into law.
Meanwhile, more and more cohabiting couples in England and Wales—nearly 6 million people now cohabit in the United Kingdom—go without the legal protections on breakdown or death that the Law Commission has firmly recommended that they should have. This is against the background of widespread public confusion about the position in law of people who choose to cohabit. In a British Social Attitudes survey in 2006, no less than 58% of respondents thought that cohabiting couples who split up were probably or definitely in the same position as married couples. The myth of the common law marriage is widespread, but it is just that, as your Lordships know: a myth without any foundation in law.
Reform of the law relating to cohabitation enjoys widespread judicial support. Scotland has had a cohabitation law similar to that proposed by the Law Commission since 2006. Ireland introduced similar legislation in 2010. This is what the noble and learned Baroness, Lady Hale, our one woman Supreme Court judge—and how regrettable it is that she is the only one—said last July, in a major case on the Scottish Act in the Supreme Court, Gow v Grant:
“The main lesson from this case, as also from the research so far, is that a remedy such as this is both practicable and fair. It does not impose upon unmarried couples the responsibilities of marriage but redresses the gains and losses flowing from their relationship”.
She concluded:
“‘The Act has undoubtedly achieved a lot for Scottish cohabitants and their children’. English and Welsh cohabitants and their children deserve no less”.
This is not good enough. The Law Commission’s proposals on separation were made in 2007 after a long and detailed consultation, and on intestacy in 2011. They were thorough and carefully considered. The Law Commission is the independent body set up by Parliament to recommend to the Government necessary law reforms, with a mission to keep the law fair, simple and modern. Yet in spite of repeated pleas from the professions and the judiciary at all levels to implement the commission’s proposals, no action has been taken.
I am not saying that any proposal of the Law Commission should automatically be implemented without parliamentary scrutiny—far from it. Of course it is for Parliament to determine what proposals it will implement and what it will decline to implement. However, the point of having the Law Commission is to achieve reform of the law, and that central function risks being thwarted by the failure of government at least to bring legislation before Parliament to implement the commission’s proposals. I suggest that the default position at any rate should be that the Government should bring forward legislation for consideration by Parliament when the Law Commission makes detailed proposals for law reform.
As a result of a decision taken by the conference of my party in Glasgow this autumn, the implementation of the Law Commission’s proposals on intestacy and on relationship breakdown is now Liberal Democrat policy. However, that in a sense highlights the problem. Proposals of the Law Commission for law reform should not have to be the stuff of party politics. I do not disagree with my noble friend Lord Henley that this fast-track procedure should not be available for every controversial proposal of the commission, but that does not mean that the proposal should not be brought before Parliament to be debated in the usual way. Governments of all parties should regard it as incumbent upon them to bring legislation before Parliament to implement Law Commission proposals.
Under the protocol set out in the Law Commission Act 2009, agreed between government and the commission, the Lord Chancellor is under a duty to report annually to Parliament on progress in implementing Law Commission reports. The Government must take that protocol seriously and indicate a high duty in this area. The progress on cohabitation reform suggests that such a duty has not been taken sufficiently seriously to date. The Bill is welcome but does not go far enough. One is left with an uncomfortable sense that we are implementing the easy and non-controversial proposals and ducking those that are more controversial. I adapt the words of the noble and learned Baroness, Lady Hale: the Law Commission’s proposals deserve better than that.
Lord Shaw of Northstead (Con)
My Lords, I am no lawyer and do not propose to go into the detail of the Bill. My sole objective is to show my welcome—and, I believe, everybody’s welcome—for its introduction.
The Bill introduces amendments to legislation some of which goes back as far as 1925. They seek to correct shortcomings in existing legislation that have appeared. I was prompted to take an interest in the Bill by my recollection of a family incident some years ago. Our solicitors suddenly produced a number of short documents for each of us, including uncles, aunts and the rest, to sign. My immediate response to all this was, “Why the devil should we sign them?”. So the solicitors came back to me and I was told that if certain highly unlikely but entirely possible happenings took place concerning intestacy—including sudden unexpected deaths and so on—the intentions of our wills or trusts would not fulfilled. Having been told that, I did not go into the matter any further—I just told everyone to sign as quickly as possible. Presumably all is well and, anyway, I do not think that there were any sudden deaths or whatever in the family.
In looking at the changes outlined in the Bill it is very important from our point of view that they have all been carefully and thoroughly considered and approved by the Law Commission, which has itself sought full public comment before arriving at its conclusions. In supporting the Bill, I express my thanks to the Law Commission for its work and its conclusions, and I hope that these will lead to a speedy, welcome and successful passage of the Bill.
Baroness Hamwee (LD)
My Lords, I had friends—not Quakers—whose favourite activity of a long winter’s night, when we were all students and young lawyers in practice, was to make and remake their wills. I do not know whether they filled in the odd half an hour with the odd codicil as well. Many of us, like them, at some point in middle age, go from, “I am immortal” to, “I cannot face thinking about it”. It is no surprise that the Nuffield study used by the Law Commission reported that family circumstances and the wish to avoid family arguments, as well as having assets, is the prompt to make a will. I say “assets” rather than “wealth” because there is also awareness, particularly of the cost of housing and the positions of one’s children and grandchildren.
I was fascinated by some of the information at the back of the Law Commission report. I have to say that when I picked it up last night I thought, be careful what you wish for. The jump in the number of intestacies in the three years in the middle of the 2000s—or, as the Law Commission explains, probably deaths five years previously, when the grant was in those years—is very puzzling. The report is impressively thorough; one would expect no less.
Many people think that the law must automatically reflect what they perceive to be sensible and right, but, as other noble Lords have already said this afternoon, what you think is right may not coincide with what I think is right. I was taken by the emphasis the Law Commission put, and which the Minister has analysed and repeated, on rules, without affecting freedom of personal decision. The aim of bringing the law into line with needs and expectations reflects exactly what the law should do, but there are, as has been explored, new forms of family and some very complex permutations, given sequential marriages, step-relationships and so on. I could tell from the Minister’s speech that that is well recognised. I knew that with my noble friend Lord Marks taking part in the debate there would be no need for me to linger on the issue of cohabitation, but I agree with him on the complexity and importance of international aspects too.
I was particularly interested in the provisions for adopted children who are part of a new family. I was lucky enough to take part in the recent work of the Select Committee looking at adoption legislation. It highlighted for us the importance to many adopted young people of their sibling relationships and of the maintenance of contact with their birth siblings. The issue of different rights in the case of children of deceased birth parents, where some interests are vested and some are contingent, had not occurred to me, but I realise that it must be very difficult, both for adopters and for adoption agencies, to handle this issue. I suspect it may also be pretty difficult if adopters who have a child whose interests are contingent have children who have significantly less wealth than their adoptive sibling but, as the Minister said, this is typically a very open arrangement.
The provisions about maintenance and advancement seem eminently sensible. Given what applies to which trusts created when, I did wonder whether this might be some sort of job creation scheme for lawyers, who will all be advising their clients to make new wills. However, in defence of the profession, I did not recognise the scenario painted by the noble Lord, Lord Wills, although I accept there are bad apples in every profession. I did have a parallel thought in that I object to the market that the banks have created in wills and probate. The noble Lord, Lord Beecham, is nodding. It is a good thing that they are not as creative in their timing as the noble Lord, Lord Wills, has suggested is possible. I would be intrigued to see his solution to this. It is in the interest of solicitors—I am a solicitor, despite not having practised for some time—as well as of clients that there is simplicity. Dealing with a client at war with his family after a death in that family is stressful for everyone, including the solicitor. Some arguments can never be solved.
There will be points to probe in Committee. Along with the noble Lord, Lord Henley, I wondered about assets which are classed as investments if they are only narrowly investments. I was thinking about works of art—what a pity if they cannot be enjoyed as well as being investments. I know people who collect works of art who justify it to themselves as being an investment, but a lot of people enjoy seeing the works on their walls. I have not thought this through but I wonder whether there is any interaction here with the inheritance tax provisions, which are different for personal assets and for the assets of a trade or business. That comes from having been a partner in a firm that acted for a lot of people in the arts world.
There will be points such as that to probe but there is one that I should like to raise now. I should be glad to know before we reach Committee whether it is intended that different provisions of the Bill will come into force at different times. I appreciate that the commencement sections of a Bill really are for the geeks but it is important here to understand this, because a lot of the provisions work as part of a complete package. No doubt, along with other Members of this Committee, I soon will be off to add remaking a will to my to-do list.
Lord Lloyd of Berwick (CB)
My Lords, I am glad to have the opportunity to speak during the gap. I do not intend to deal with any of the provisions of the Bill, which have already been very well covered in the debate but want to say something about the procedure that we are following.
I remember the time not so very long ago when the Law Commission would study an area of the law that was badly in need of reform. Very often it would be doing so at the request of the Government. It would then take all the trouble and all the care to produce a report such as the one we have here—I refer not just to the cover but to the contents, some of which I have read—but nothing would happen. The Government may have accepted all the recommendations of a report and thanked the commission warmly for all its hard work, but still nothing would happen. The reason always given was that there simply was not time for a Second Reading in the Chamber.
Therefore, the matters covered by these reports, urgent though they might be, would accumulate from year to year. It became almost a scandal and must have been extremely frustrating for the Law Commission. Then came the noble Baroness, Lady Ashton, like a sort of deus ex machina. As Leader of the House, she was determined to do something to speed up the process, which is exactly what she did. I remember well the discussions that we had at that time, and I can say that without her we would not be here today in the middle of this Second Reading debate. I hope that the noble Lord, Lord Wills, who spoke on this, can confirm that view.
Lord Wills
I am sure that this is not courteous but I should like not only to place on record the work done by my noble friend Lady Ashton but to put the history straight. When I came into position in 2007, this was not a work in progress. The person who deserves most credit is no Minister but the then chair of the Law Commission, Sir Terence Etherton—now, I think, at the Court of Appeal. He was indefatigable in badgering me as the responsible Minister and all the officials to make sure that something happened. I am sure that the Ministry of Justice will remember this. As we are paying tribute, I say with all respect to my noble friend Lady Ashton that if there is one person who really deserves the credit it is Sir Terence Etherton. I hope that the noble and learned Lord will agree with me on his central role in this important reform.
Lord Lloyd of Berwick
I entirely agree with the noble Lord—I can remember Lord Etherton badgering me in exactly the same way—but it was the noble Baroness, Lady Ashton, who in the end got it through. It seems to me that we owe a huge debt of gratitude. By “we”, I mean the law and not just us around this Committee.
Perhaps I may couple just one other name: that of the noble Lord, Lord McNally, the Minister in charge of this Bill. I hope that he will not be too surprised by my saying that. As I think I have been involved in all the Law Commission Bills—I was surprised to hear that there were six; can it be as many as that?—I know from my experience that having a Minister who is himself keen on law reform makes all the difference.
Finally, I want to mention Professor Elizabeth Cooke, who has been in charge of work on this Bill from its very inception. In the old days, Acts of Parliament were sometimes named after the person who had drafted them; Lord Tenterden’s Act comes to mind. I would like to think that at some time in the future this Act might become known as Baroness Cooke’s—I say Baroness; she is not a Baroness yet—or Professor Cooke’s Act. This is an admirable report; it is very well set out, very clear and ideally suited for this procedure. I hope that it will find favour with the Committee.
Lord Beecham (Lab)
My Lords, I join other noble Lords in thanking the Minister for the clarity with which he went through this very technical Bill. He has made it comprehensible, I think, to all who have heard him address these issues today. Before we began today’s debate, the noble Lord, Lord Henley, inquired whether I had any more Dickensian quotations—we tend to bandy them across the Chamber at one another. I confess that I have not come up with anything, except perhaps to note that this is after all a Bill about expectations great and modest.
The noble Lord also said that he was pleased that the Bill did not interfere with the freedom of testation, which of course it does not. It is perhaps worth reminding your Lordships that the Inheritance (Provision for Family and Dependants) Act allows for applications to be made in respect of an estate where a dependant feels that his or her interests have not been adequately reflected in the will that has been made or, indeed, under an intestacy. However, this measure does not deal with that particular set of events.
The noble Lord inquired into the numbers involved. The impact analysis of the Bill refers to there being something like 1,045 estates valued at £450,000 or more; that was the figure he was looking at, which currently applies for cases where there is no surviving spouse. However, although there are 1,000 such estates or thereabouts, the estimate is that only 5% to 10% of those are intestate estates. We are therefore dealing with pretty modest numbers, although they are obviously significant to anyone involved with one of those estates.
I have to congratulate my noble friend Lord Wills again on the ingenuity with which he manages to bring into legislative debates matters about which he is particularly concerned. I am tempted to throw in a slightly Dickensian reference to King Charles’s head, but will not pursue that at any length because, of course, he raises a legitimate and interesting point, which we will no doubt have the opportunity of debating further. However, when it comes to exploitation of vulnerable people or misconduct by any adviser—be it a solicitor, bank or anyone else whose responsibility clearly ought to be to act in the interests of those to whom an estate has been left—the numbers are again pretty small. The noble Lord mentioned 65 cases. There are 240,000 grants of representation every year; that figure appears in the commission’s report. It is a minuscule proportion, but of course any one case is too many. Not far from where I used to practise in Newcastle—I declare my interest as a now-unpaid consultant in a firm in which I was formerly senior partner—there was a serious case where, I recollect, a £90,000 bill was levied on a £100,000 estate by a solicitor who was, of course, subsequently struck off and also visited with criminal sanctions. I think the office where he carried out this misfeasance remains to this day unlet and unoccupied. That is not to say that my noble friend is not right to raise the issue. It will be interesting to see what proposals he has to make about it.
The noble Lord, Lord Marks, made some interesting points. He referred to the fact that dealing with the issue of cohabitees is to be Liberal Democrat policy, which must of course give great heart to cohabitees, bearing in mind what happened to things like student loans and nuclear power. Nevertheless, hope springs eternal in a Lib Dem’s breast. We might see some action—possibly—along those lines. I share the noble Lord’s concern about cohabitation. The commission argues a strong case for dealing with what is now a growing number—the noble Lord referred to 6 million although I think the documentation suggests 7.5 million —of people, about 15% of families, living in that state. I am not sure why the Government choose not to proceed—not necessarily in this Bill but in this Parliament—on a matter which I would have thought would command support. The consultation responses to the commission’s report were fairly limited. Although I recall there were some in the part about cohabitation, they were a relative handful.
If I have a confession to make, it is that I did not quite struggle through the entirety of the Law Commission’s report, but did look particularly at the section on cohabitation—which, appropriately enough, comprises about 15% of the report. There were obviously those with particular religious views who were concerned about the cohabitation proposal but there did not seem to be great hostility beyond that. I would have hoped that the Government would look more sympathetically at that. It need not be in this Bill but they could, at least, pursue further consultation with a view to bringing forward legislation, whichever Government assumes office after the next election.
I agree with the noble Lord on that issue but am not entirely convinced about his references to the desirability of the half-share—which, under present circumstances, may be held on a life interest—becoming absolute. In many cases that would be absolutely appropriate, but it might be a bit hard in a situation where the total estate is not that much more than the statutory amount of £250,000 but where there are children, particularly if they are from a first marriage or civil partnership, for example. Such children might see their inheritance reduced effectively to a quarter of the estate; whereas ultimately, under the existing framework, it could be a half. If there is a lot of money, that is less relevant, but if it is a relatively modest estate there might be some potential hardship to children, particularly in the case of a second marriage or second civil partnership. Having said that, I suppose that it is always possible to revisit these matters in due course, but it would be interesting to see how that plays out.
Two other matters occurred to me. The first comes from the left field, as it were, and relates to the position where a testator or intestate with English domicile had two wives. That may be the case if someone of a certain religion had come from a country where it was possible to have more than one spouse. I am not sure what the current situation is, let alone how that would apply in these circumstances. I do not know whether the Minister, his colleague or those behind him can advise about that. It is not going to be a huge issue but it might be an issue.
I mentioned the second issue—the potential impact when a joint tenancy is part of the family’s assets—at the meeting that the Minister helpfully organised. A joint tenancy is one in which there is an undivided share of property. A husband and wife, or any two people, hold the property, which automatically passes on death to the other. It is not included in the estate and is not therefore taken into account under the present arrangements. That is as opposed to a tenancy in common, where you have a distinct share that can be left by will or would pass under the intestacy rules. I suppose it is possible that the inheritance family provision legislation could apply in that context; someone may feel that they have been significantly bypassed and could make an application. I do not know what the prospects of success for such an application would be. Perhaps I am overcomplicating things but I wonder whether some notice ought to be taken of the potential impact of a joint tenancy absorbing perhaps a significant part of the estate and taking it outside of the regime that the Bill helpfully provides. Perhaps one might consider that in Committee or perhaps the Law Commission might want to advise the Minister before we get to Committee as to whether anything might be done in that respect.
Basically, we are supportive of the proposals. Subject to possible minor adjustments here and there, they represent a way forward. I join the noble and learned Lord, Lord Lloyd, and others in paying tribute to the commission and particularly to Professor Cooke for the amount of work done and the clarity with which the case has been made, both in documentation and in the helpful session that we had. We look forward to completing the work on the Bill fairly rapidly. It will certainly provide justice for many people and improve on the current situation. In principle, therefore, we support the Bill.
Lord McNally
My Lords, we have had a good debate, which I am sure bodes well for very interesting discussions in the Public Bill Committee. I again put on record my thanks to the noble and learned Lord, Lord Lloyd, for taking on the responsibility as chair of that Committee. As noble Lords will have gathered, I am also much reassured by the presence close by of Professor Cooke as I try to give answers to matters raised by noble Lords.
The first of my noble friend Lord Henley’s questions was about the situation where there is no surviving spouse or children. In such a case, the law remains the same. As to how the fixed sum was reached, that came out of a study in 2005, which made me think that it might be ripe for looking at again. On the question of whether this is a surprisingly large sum, one of the factors is housing, which makes it relatively easy for an estate to have quite large sums in it. Nevertheless, I am told that it affects at the moment only 2% of estates, partly because, as was mentioned, people who have a house and realise that its value is rising have the incentive to make a will.
The point that my noble friend raised about chattels is one that we may well explore in Committee. As I think my noble friend Lady Hamwee said, it is in respect not just of jewellery but of paintings and other things where there might be a wavy line between investments and chattels. That is certainly something to look at. For the same reason that I will refer to when I come to the interventions of my noble friend Lord Marks, I assure my noble friend Lord Henley that this procedure will be used only for non-controversial reforms. That is its strength and why Parliament has confidence in it. We should keep to that kind of discipline.
As the noble Lord, Lord Beecham, said, the noble Lord, Lord Wills, took us to interesting areas. However, the noble Lord was right to point out the danger of mischief and of the abuse of elderly and isolated individuals. Much of that is the responsibility of the Office of the Public Guardian, which also comes within my ministerial responsibilities. Allegations of theft or overcharging by any professional are serious and concerning but I do not believe that this Bill is the right place to tackle such misconduct. The Inheritance and Trustees’ Powers Bill does not directly deal with wills but instead focuses largely on situations where no will has been made. Dealing with the concerns raised by the noble Lord would not only expand the content of the Bill to deal with wills but would mean taking it into the territory of professional legal regulation, which would be a very significant step and is already dealt with under the auspices of the Solicitors Regulation Authority and the Law Society. However, the Committee will undoubtedly consider the points made by the noble Lord, Lord Wills, carefully unless the chairman rules that out. Not that I am not suggesting that will happen—we look forward to an interesting debate on any amendment tabled by the noble Lord, Lord Wills.
My noble friend Lord Marks gave us a glimpse of the detail into which Liberal Democrat conferences go in making policy. I cannot quite remember the debate myself, but I am sure there were many speeches from the floor that dealt with our policy on this. I have to say to my noble friend that he used a good deal of his speech to talk about things that we have not done and were not in the Bill. These are very relevant and may well need to be brought before Parliament, but he gave the game away at the end of his peroration when he described the issues that we have left out of the Bill: he will see when he reads Hansard that several times he used the word “controversial”. It is because they were controversial that they fell foul of the request of the noble Lord, Lord Henley, that we stay clear of that.
Lord Marks of Henley-on-Thames
My Lords, I draw my noble friend’s attention to a distinction that I hoped I had made between controversial proposals of the Law Commission, which I suggest ought to be brought before Parliament for legislation, and non-controversial proposals, such as are included in the Bill, which are suitable for this procedure. I hope I was making it clear that I do not suggest that this fast-track procedure is suitable for controversial legislation, but I do suggest that the Law Commission should not be frightened or intimidated away from introducing controversial proposals. Indeed, when considering its new, 12th—I think—programme of law reform, it has made it clear that it does not propose to steer clear of controversial proposals. I believe that that is thoroughly laudable.
Lord McNally
I could not agree more. I also say that I take very seriously my responsibility to bring the non-controversial parts of the work before the House.
Whether we should take the non-domicile question out of the Bill can be looked at in Committee. It seems to me that what we have done is no more than to recognise the realities we face in our relations with our Scottish colleagues, but I take on board the point made by my noble friend Lord Marks that in an increasingly international world some of this might have cross-border dimensions.
My noble friend Lady Hamwee made the point about housing now being a big part of any inheritance. She also raised the question of inheritance tax implications. We can look at that in Committee if necessary, but on her specific question about the commencement provision, there is no precise timing as yet, but the intention is that commencement will be all at one time.
I was extremely pleased by the contribution of the noble Lord, Lord Shaw, both for his welcome for the Bill and for the personal example that he gave, which was extremely helpful to the Committee. I shall treasure the compliment of the noble and learned Lord, Lord Lloyd; I shall tuck it away. We will have to leave it to the historians to decide whether it is Wills, Ashton, Etherton or one of the joint parentages we were talking about earlier in the debate. Nevertheless, the fact that the noble and learned Lord has been willing to take on the chairmanship has given an impetus and confidence to this procedure.
I was greatly sorry that the noble Lord, Lord Beecham, did not take this opportunity to give us a quote from Bleak House. Surely there is one somewhere here.
Lord McNally
It is the classic. There is an old joke of which I saw a picture in a bar in Scotland: one farmer was pulling a cow’s horns, another farmer was pulling its tail and underneath was a lawyer milking the cow. However, the noble Lord, Lord Beecham, made a spirited defence of his profession and put into perspective some of the suggestions made about malpractice. As I mentioned when I dealt with the contribution of the noble Lord, Lord Wills, this is looked at elsewhere in the law.
On the issue of two wives, only the wife of a marriage that was legally recognised under English law would be relevant as regards intestacy rules. However, if noble Lords would like to pursue this in Committee, we can look at it in more detail. You do not have to be a Muslim or a Mormon to have some interesting domestic arrangements; this is not personal, but I can think of one or two which might come into this category.
That just shows why it is extremely sensible to use this procedure and the careful research and advice of the Law Commission in carrying this forward. I hope that we can now move into Committee and do this work, which is one of the more satisfactory exercises in Parliament. As the noble Lord, Lord Shaw, pointed out, we manage to pick up pieces of the law that have fallen out of date and address them in an extremely practical way.
House of Lords
Introduction: Lord Purvis of Tweed
Introduction: Baroness Hodgson of Abinger
Foreign Languages: European Institutions
(11 years ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Harrison
To ask Her Majesty’s Government what action they are taking to encourage the study of modern foreign languages to maximise the United Kingdom’s influence in the European institutions.
The Senior Minister of State, Department for Communities and Local Government & Foreign and Commonwealth Office (Baroness Warsi) (Con)
My Lords, the Government recognise that a lack of modern language skills is a barrier to anyone who wishes to work for the EU institutions. We are addressing this at two critical points, by encouraging school pupils to study languages and providing intensive, targeted training for those applying for an EU career. We have also prioritised higher education funding for modern language courses to ensure the continued availability of language study in higher education institutions.
Lord Harrison (Lab)
My Lords, given the British brain drain from Brussels in European Union institutions, which has seen a drop of some 24% of British people working within the European Commission, and given that no fewer than two out of three jobs notionally available to the United Kingdom are left idle by this Government or filled by others, what more can be done on the language front? Will the Minister please study the report of the British Academy, and can she, within her own party, douse the Tea Party Tories, whose constant Europhobia inhibits young people, diplomats and British people from taking the opportunities to be found within the single European market and the wider European Union?
Baroness Warsi
The noble Lord makes the important point that the number of Brits in the European Union institutions is low. It is right that it has been falling over a number of years, from long before 2010—and I am sure that the noble Lord would accept that. The UK represents 12% of the EU population but we have only about 5% of EU staff. Not having a second or a third language, which was also required for some of these jobs, has been the largest barrier. We are putting in place a number of things. I hope that the noble Lord will join me in congratulating my right honourable friend the Foreign Secretary on reopening the language school at the Foreign and Commonwealth Office in September this year, which was sadly closed in 2007. I am sure that he will also join me in congratulating the Secretary of State for Education on putting an emphasis on languages in schools and making them one of the performance indicators for the EBacc.
Baroness Coussins (CB)
Is the Minister aware that only 2.6% of the total of last year’s applicants to the European Civil Service were from the UK? Does the Minister agree that our Civil Service recruitment process should collect information on the language skills of new recruits and that an audit should be carried out across the whole of the current Civil Service to establish the extent of the language skills that we do or do not have? If she agrees that that might help to target the individuals best placed to boost our numbers in Europe, will she see that it gets done?
Baroness Warsi
There are a number of reasons why we have problems in relation to that kind of recruitment. One is availability; graduates here are just not as aware, as they are in other European countries, that there are these great opportunities in the EU institutions. Therefore, we have spent a huge amount of resource and energy in 2011 and 2012 in having a road show at graduate fairs to encourage people to apply for these jobs. That has included ministerial involvement. We are investing in language schools, as I have said, and we have also set up an EU staffing unit, which specifically brings together civil servants from across Whitehall, not just the FCO—the FCO hosts this—who can be trained to fit into these institutions. When people get beyond the first stage, we provide some intensive training to get them through to the second stage.
Lord Brittan of Spennithorne (Con)
Does my noble friend agree that it would be helpful if, in the course of speeches made by Ministers on European issues, the availability of such positions in the European Commission and other institutions was mentioned, as a ministerial reference would carry much more weight than just making it available on paper?
Baroness Warsi
I will certainly make sure that we try to incorporate the opportunities which exist for civil servants in the European Union institutions as part of the reform of the European Union because the more Brits that we have fighting for British interests within the European Union, the better it is for the country as a whole.
Lord Foulkes of Cumnock (Lab)
Does not the Minister think that this will be an increasing problem, particularly with the growth of free schools, approved by the Conservatives and the Liberal Democrats, where staff do not need any qualifications and we cannot be guaranteed that they are proficient in English, let alone any other language?
Baroness Warsi
I am not sure that I can answer education questions as well. However, what I can say from this Dispatch Box is that I am a huge supporter of free schools and the opportunities that they present to some of the most marginalised. I can give examples of communities that I work incredibly with where children who have been let down by much of what was available to them in the education system previously are now being offered the best education—the kind of education which some parents can pay for but which is now being offered to these children and is paid for by the state.
Baroness Falkner of Margravine (LD)
My Lords, my noble friend may be pleased to hear that my 16 year-old daughter is being taught German by a teacher who is not a qualified teacher but is a German national and mother-tongue speaker. The emphasis must be on having a good teacher rather than on whether the teacher has formal qualifications. My daughter is on course to get a very fine grade indeed. As regards the re-established language school that my noble friend mentioned, what level of interest has there been from across Whitehall departments in taking up the opportunity offered by that language school?
Baroness Warsi
My Lords, 80 languages, 70,000 hours of training and 1,000 full and part-time students—that is the language school.
Lord Liddle (Lab)
Does the noble Baroness agree that we face an extremely serious situation in relation to British influence in the European Union given that the number of British staff working there has declined by a quarter in the past seven years? Are the Government serious about doing something about that as I see no mention of it in the Foreign Office report or in its statement of priorities yet it should be a top national priority? Are they just sleepwalking out of the European Union?
Baroness Warsi
I think the noble Lord will take great comfort from the fact that since 2010 the number of British applicants has increased by 50%.
Lord Tebbit (Con)
My Lords, did I hear my noble friend say that British civil servants going to the Commission lobby for British interests? Surely, that is contrary to Community law. Surely, my noble friend would agree that those who serve the Commission are required to serve its interests even after they are retired as a condition of continuing to get their pension.
Baroness Warsi
Those who serve the Commission, whatever their nationality, bring to the table their expertise and their experience from within the British Civil Service. Any civil servants who bring their experience of the British Civil Service to European institutions bring something additional and special which is good for the British Isles.
Millennium Development Goals
(11 years ago)
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Lord Chidgey
To ask Her Majesty’s Government what new millennium development goals they would prefer to see introduced post-2015.
Lord Dholakia (LD)
My Lords, on behalf of my noble friend Lord Chidgey, and at his request, I beg leave to ask the Question standing in his name on the Order Paper.
Baroness Northover (LD)
My Lords, the MDGs have provided an important framework in helping to reduce poverty, but there is still much more to do. The 12 successor goals recommended by the high-level panel offer practical targets which tackle the root causes as well as the symptoms of poverty. We are particularly pleased to see a proposed stand-alone goal focused on women and girls.
Lord Dholakia
My Lords, I thank the Minister for that reply and look forward to the debate on this matter tomorrow. Does my noble friend accept that poverty reduction must be the top priority for the development agenda as 70% of people who were within the millennium development goals have not benefited from the programme, almost all of them women? What indicators does my noble friend have in mind to measure over time where the discrepancies that discriminate against so many women and girls appear in the development agenda?
Baroness Northover
My noble friend is absolutely right. As he will know, the new goals will focus on eradicating extreme poverty within a generation. Central to this, as we all recognise, is reaching women and girls, many of whom were left behind by the MDGs. That is why we are very pleased that there is a proposed stand-alone gender goal and also that there is a lot of emphasis on disaggregating data—only if you have good data can you move things forwards.
Baroness Kinnock of Holyhead (Lab)
My Lords, will the Minister clarify where things stand on the leave-no-one-behind principle included in the 2015 framework which, of course, focuses on social justice and equity? Is the Minister aware that when asked at a press conference in Liberia whether the UK would prioritise inequality over economic growth the Prime Minister replied no, that economic growth was the priority? Surely we can agree that progress achieved will not be sustained unless there is a strong focus on equity within and between countries.
Baroness Northover
My Lords, the noble Baroness will, of course, know the range of goals. Taken together they include all the areas the noble Baroness is talking about. Obviously we need economic growth to try to pull people out of poverty but, as she also knows, leaving no one behind is included there. The aim of the new MDGs is to eradicate extreme poverty. One will not do that without addressing both social justice and economic growth.
Baroness Jenkin of Kennington (Con)
My Lords, I welcome the focus on the post-2015 agenda, but will my noble friend agree that finishing the job of the existing MDGs is also crucial? Will she also inform the House what progress she hopes will be made in the next two years?
Baroness Northover
My noble friend is right and it is important to take forward the current MDGs. However, one of the most important things now is to make sure that the proposed new MDGs, or something very similar to them, are adopted in 2015 so that the progress made in the past 13 years is built on. As noble Lords know, DfID is committed to 0.7% of GNI going to aid. For example, my right honourable friend the Secretary of State has just announced £1 billion going towards the Global Fund. All this will help to deliver the original MDGs.
The Lord Bishop of Ripon and Leeds
My Lords, will the Minister press for tax justice to be a distinctive international goal in ensuring that major corporations pay appropriate taxes and in channelling taxes to the countries where profits are actually made?
Baroness Northover
The right reverend Prelate is right to highlight that and he will know that the UK Government are emphasising the importance of tax being collected appropriately within the developing countries. This will be transformative. Corporate transparency is one of the aspects required and he will know that my right honourable friend the Secretary of State for BIS, Vince Cable, is working very hard on that. BIS has just consulted and is considering responses, and DfID is trying to ensure that tax regimes in the developing countries are strengthened and built on.
Lord Collins of Highbury (Lab)
My Lords, evidence shows that investing in a child’s earliest years makes the biggest difference to their lives and to the country’s social and economic fortune. Will the Minister support calls to put early childhood development at the heart of the new post-2015 development framework?
Baroness Northover
Again, if the noble Lord looks at the proposed new MDGs, he will see that that kind of approach can be assumed to be there. There is new emphasis on, for example, good nutrition, which is so important in the first 1,000 days of a child’s life, as well as education—not just primary education but covering a wider scope. Therefore, if the noble Lord looks down the list, he will see that concern for young children is built into a number of the goals.
The Earl of Sandwich (CB)
The noble Baroness mentioned our progress towards 0.7% of GDP, but does she agree that our European neighbours are getting nowhere near that target? What are the Government doing to encourage them?
Baroness Northover
As the noble Earl knows, the northern European countries are stronger in that regard than the southern and eastern ones. However, there has been progress among some of the new EU countries, and that is encouraging. We do, and will, continue to argue this case to make sure that that is a high priority.
Commonwealth Heads of Government Meeting
(11 years ago)
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Lord McConnell of Glenscorrodale
To ask Her Majesty’s Government what are their priorities for the Commonwealth Heads of Government Meeting in Colombo on 15 to 17 November.
The Senior Minister of State, Department for Communities and Local Government & Foreign and Commonwealth Office (Baroness Warsi) (Con)
My Lords, our priorities for the Commonwealth Heads of Government Meeting, CHOGM, include discussions on the post-2015 global development framework and enhancing Commonwealth values. CHOGM also provides an opportunity to raise further international awareness of the need to end sexual violence in conflict. UK Ministers will also engage with their Commonwealth counterparts and pursue relevant bilateral issues with Sri Lanka, including reconciliation, human rights and consular concerns.
Lord McConnell of Glenscorrodale (Lab)
My Lords, the Commonwealth charter, agreed by all member states in the Commonwealth last December, states quite clearly that participating in free and fair elections is an inalienable right of the populations of every country in the Commonwealth today. Despite that, the election held in the Maldives on 7 September has now twice been delayed. First, its second round was delayed and, subsequently, a rerun ballot was cancelled this weekend following police intervention. As a result of that, it is likely that the Maldives will now not even be represented in Colombo because they will not have a head of state when the CHOGM takes place this year. The Commonwealth Secretary-General has called for all involved to take speedy action to ensure an outcome for this election that represents the popular will. Will the UK and the other member states of the Commonwealth assist him in trying to make that happen?
Baroness Warsi
I am always grateful for the noble Lord’s intervention in these matters; he has great expertise in relation to the Maldives. As he said, the rerun of the presidential elections has now been cancelled at short notice. The Maldivian Elections Commission announced yesterday that this will now take place on 9 November and, in the event of it going to a second round, we are still hopeful that it will be concluded by about 16 November. The Foreign Secretary released a statement outlining the importance of the democratic process and of the elections concluding in accordance with the Maldives constitution, which says that a President should be inaugurated by 11 November. We have consistently pressed for this. If that is followed, there may be a representative by 15 November, when CHOGM takes place.
Lord Howell of Guildford (Con)
Does the Minister accept that, while all human rights issues are extremely important and should be raised with great vigour by our leaders when they go down to Colombo, one of the major focuses will be on the vast expansion of Commonwealth trade and investment organised by the Commonwealth Business Council and Commonwealth Business Forum in Colombo? Is she aware that the Chinese are planning to send a very large delegation—said to be 70 strong—to this conference, as are Japan, the United Arab Emirates and Qatar, demonstrating their commitment to the possible expansion of trade with the Commonwealth? Can she tell us how many delegates the UK Trade & Investment agency will be sending there?
Baroness Warsi
I am not sure what the precise nature of the final delegation will be, but I will certainly write to the noble Lord with details of what representatives of UKTI will be there. Of course, we encourage trade not just between Commonwealth countries but between Commonwealth countries and other nations, but I will write to the noble Lord with more details.
Lord Harries of Pentregarth (CB)
Does the Minister agree that one of the most distressing features of the Commonwealth is that in 41 out of the 53 countries, same-sex relationships are a criminal offence, and that in some countries, such as Uganda, they carry the possibility of life imprisonment or even, sometimes, a capital offence, if the present law gets through? Will there be any opportunity to raise this distressing situation at the conference?
Baroness Warsi
That is, of course, a matter of concern. Indeed, it was raised in a debate only last week. The Commonwealth charter says clearly that there will be opposition to all forms of discrimination, but the human rights situation in all the Commonwealth countries still leaves a lot to be desired. That is one issue. The noble Lord will be aware also that 38 Commonwealth countries retain the death penalty.
Lord Bach (Lab)
My Lords, we all agree that the Commonwealth is a vital and positive partnership between countries. However, does the Minister agree that there is growing evidence both of a severe deterioration of human rights and a move towards authoritarian government in Sri Lanka itself? Does the Minister agree that it would send a powerful and necessary message to the Government of Sri Lanka if the British Prime Minister were to follow the lead of his fellow Conservative Prime Minister in Canada and decline to attend? If she does not agree: why not?
Baroness Warsi
My Lords, the Government believe that CHOGM will, among other things, provide an opportunity to shine a light on Sri Lanka and to question it in relation to the many commitments that were given as part of the Lessons Learnt and Reconciliation Commission. Some recommendations from the commission have been implemented, but many more remain on the table. We will deliver an incredibly tough message to the Sri Lankan Government that they need to make concrete progress on human rights, reconciliation and political settlement, and that when we attend at CHOGM we expect to have unrestricted access to NGOs and to the media. The Government believe that the best way forward is to go there, engage, have tough conversations and shed light on the challenges still presented in Sri Lanka.
Lord Steel of Aikwood (LD)
When my noble friend wound up the debate on the Commonwealth last Thursday, she made the point that such a heavyweight delegation going to Sri Lanka would have a good effect on the human rights situation there. Could she say what she had in mind, and what effect we have had so far?
Baroness Warsi
I have been looking at the programme of the Prime Minister and of the other Ministers who will be attending. It would be inappropriate at this stage for me to detail that programme and where they will visit; probably it would be in breach of some security provision. However, from what I have seen, I am confident that this will be an opportunity for us to deal with these issues incredibly robustly, to travel, see, engage and shine a spotlight. The Sri Lankan Government should be aware that it will not be just us; the world’s media will be there and questions will be asked.
Lord Wills (Lab)
My Lords, if the Sri Lankan Government persist in ignoring the incredibly tough messages that the Minister says the Government are going to send them about the human rights record in Sri Lanka—as they have ignored all such representations, from the United Nations and from respected human rights organisations, for the past year or more—at what point will the Government decide that constructive engagement with this regime is not the only way forward?
Baroness Warsi
My Lords, all I can say is that at this moment in time the Government believe that constructive engagement is the right way forward.
Royal Mail: Pricing of Shares
Lord Donoughue
To ask Her Majesty’s Government whether any shares in Royal Mail offered at 330p were issued to any of the banks involved in advising on the flotation price, or to any of their employees; and what are the total fees to be paid to those banks for advising on the offer pricing of the shares.
Lord Popat (Con)
My Lords, no individual employee working on the transaction or investment bank division was allocated shares. Other divisions of our banking advisers, separated from the investment banking divisions by the information barriers, were allocated 13 million shares. This is standard practice. The underwriting banks will share a maximum fee of 1.2% of the IPO proceeds, or £16.9 million. That maximum includes the potential discretionary fee of £4.2 million. The actual fee will be finalised shortly. Lazard will receive £1.5 million, as the Government’s independent adviser.
Lord Donoughue (Lab)
I thank the Minister for that reply. Is he aware that this morning the share price of the Royal Mail reached a peak of 507p, which is an advance of more than 50% on the offer price? In light of that, does he agree with the comment made in the Financial Times on Saturday? It said:
“The only loser is the taxpayer, whose furniture has been flogged—but at a fraction of its market price”.
Will the Government not try to recover something for the ripped-off taxpayer by at least insisting that they do not pay those exorbitant fees to these inadequate advisers?
Lord Popat
My Lords, we were given advice on the price for the shares by a large number of institutions. We took into account a recent flotation of a similar organisation in Belgium. We also took a view on the price determined for recently quoted companies in the UK. The price range was between £2.60 and £3.30. We pitched at the higher amount of £3.30. This flotation was very successful despite the difficulties happening in America and the impending strike by the union.
Lord Forsyth of Drumlean (Con)
My Lords, will my noble friend confirm whether any of the advisers on the share sale were the same advisers who advised the previous Government to sell our gold at the bottom of the market at a loss to the taxpayer of more than £10 billion?
Lord Popat
My Lords, I do not have that information. Our advisers were robustly looked into. Some 21 advisers made a pitch to us. Nine were selected and they advised us at a different stage of the flotation.
Lord Sugar (Lab)
My Lords, I assume that the hiring of Lazard, Goldman Sachs and UBS was for their so-called expertise in understanding the correct timing and pricing of the flotation of the Royal Mail. Will the Minister comment on why these so-called experts sold the stock at such a low level and got it totally wrong, to such an extent that the stock rose by 33% the day after and now sits at 54% higher than the issue price? Bearing in mind that other reputable banks had come on record giving a valuation of £5 billion, why were these banks ignored? What will the noble Lord do by way of an inquiry to find out who the lucky institutions were that underwrote this bargain basement sell-off?
Lord Popat
My Lords, our key objective has been to secure value for money for the taxpayer and to develop a strong business. The taxpayer still has more than 30% of the shares and the universal service will be secured for a long time. The proposal included an indicative valuation of the company based on many instances and solely on information already in the public domain. Banks made their own assumptions of the Royal Mail’s future performance. Hence we agreed a price of £3.30.
Lord Elystan-Morgan (CB)
Presumably those who were invited to advise on the flotation price were not required to pluck a figure out of the air but would have been instructed to arrive at their conclusion on the basis of certain criteria. Will the Minister confirm that that was the case and will he spell out those criteria to the House?
Lord Popat
My Lords, as I said, our key objective was to secure value for money and to make sure that this flotation was successful. The nine banks that we appointed set out the criteria and gave us advice as to the value of the shares that we should pitch at. One criterion was to make sure that the future of the Royal Mail continues to be strong. The most important criterion was that institutional investors were able to invest money for the future of the Royal Mail.
Lord Razzall (LD)
My Lords, perhaps I may follow the noble Lord, Lord Forsyth, in extending the Question. Does the Government have a view as to what steps the regulator should take regarding the irresponsible actions of the colleague of the noble Lord, Lord Donoughue, in another place in his public comments, which had the effect of encouraging small investors to buy shares without explaining the risks involved to them?
Lord Popat
My Lords, the prospectus was very clear about the risks involved in acquiring these shares. With regard to small investors, we allocated around 18% to retail investors. Ninety per cent of the retail investors who applied for shares up to £10,000 took up the shares knowing what the risks would be.
Lord Young of Norwood Green (Lab)
My Lords, can the Minister explain the contradiction between the Secretary of State’s claim that value for money was central to the Government’s strategy, given the current share price of over £5, and the view of many respected analysts that the offer price was seriously undervalued and 20% oversubscribed by banks? Can he give the House an assurance that the remaining 38% of shares will not be sold at another knockdown price?
Lord Popat
My Lords, the remaining 30% of shares is being held by the bank. We have an agreement with the Royal Mail that this will not be sold for a period of six months. The sale of shares thereafter will depend on the market circumstances and how the Royal Mail is performing in terms of its business profit and in terms of the cash that the business generates.
Lord Dobbs (Con)
My Lords, would my noble friend please spend a moment today celebrating the success of this exceptional privatisation, which has placed the Royal Mail on a footing for the future that was undreamed of four years ago? Would he further express and extend his best wishes not only to the management and employees of Royal Mail but also to their customers and of course their new shareholders, many of whom I suspect are sitting on the Benches opposite?
Lord Popat
I thank the noble Lord for those encouraging comments. This sale should be welcomed by all sides of the House. It guarantees that the universal service will remain and helps to provide the funding needed to modernise the Royal Mail. It provides a good solution for the taxpayer, for the Royal Mail employee and for customers. This is about ensuring the long-term success of the Royal Mail and securing the universal service. This privatisation is a positive step. The future of the company is now much brighter than it was. Had we pitched the price higher than £3.30 and it had failed, I am sure that the Benches opposite would have blamed us for the failure. I am glad that it was a great success and I agree with the noble Lord.
Legal Aid (Information about Financial Resources) (Amendment) Regulations 2013
(11 years ago)
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Lord McNally
That the draft regulations and draft order laid before the House on 20 May and 8 July be approved.
Relevant documents: 2nd and 8th Reports from the Joint Committee on Statutory Instruments, considered in Grand Committee on 15 October.
European Parliamentary Elections (Amendment) Regulations 2013
(11 years ago)
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Lord Wallace of Saltaire
That the draft regulations laid before the House on 9 July be approved.
Relevant Document: 8th Report from the Joint Committee on Statutory Instruments, considered in Grand Committee on 15 October.
Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Bill
(11 years ago)
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Viscount Younger of Leckie
That the Bill be read a second time.
Relevant document: 5th Report from the Joint Committee on Human Rights.
The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Viscount Younger of Leckie) (Con)
My Lords, on behalf of my noble friend Lord Wallace of Saltaire, I beg to move that the Bill be now read a second time.
This Government have made a commitment to increased transparency in public life so that we can offer the public greater confidence in our political system. The Bill will build on the transparency measures which we have already put in place. This Government were the first to publish details of the meetings that Ministers and Permanent Secretaries hold with external organisations, and we also publish details of ministerial interests, hospitality, departmental business plans and a wide range of raw data relating to the business of government. This Bill will now extend those themes of openness and accountability to our political system.
I would like briefly to say something about the progress of the Bill to date. The Government are committed, wherever possible, to publishing legislation in draft with a view to pre-legislative scrutiny. While it was not possible to publish a draft Bill in this case, the measures it contains have been subject to considered and expert scrutiny. The proposal for a statutory register of lobbyists was analysed by the Political and Constitutional Reform Committee prior to the Bill’s introduction. Since then, the Bill has also been considered on the Floor of the other place in Committee. Ministers and officials have continued to meet stakeholders regularly in order to take account of their views as the Bill progresses, and noble Lords will note the amendments which were made in the other place. I therefore believe there has been and will continue to be considerable scrutiny of this Bill. I value in particular the considered input made by the Political and Constitutional Reform Committee, the Constitution Committee and the Joint Committee on Human Rights. I very much look forward to the further analysis that this House will bring to the Bill today. I turn now to the principal measures in it.
The Bill has three main parts. First, it will fulfil the coalition’s commitment to introduce a statutory register of lobbyists. Secondly, it paves the way for greater clarity on how much money organisations spend on campaigning at general elections. Thirdly, it will give the public greater assurance about the completeness and accuracy of the membership register which trade unions already keep. This House has long had a history of shining the light of transparency on our political system through open and challenging debate. No doubt noble Lords have followed the debates in the other place on the measures within this Bill. I and my noble friend Lord Wallace of Saltaire greatly look forward to debating the detail of what the Bill does and does not set out to do, and it is an occasion for noble Lords to apply their usual thorough scrutiny.
I shall summarise briefly the measures in the Bill. Part 1 introduces a statutory register of consultant lobbyists. The Government believe that lobbying is an essential part of our democracy and plays a vital role in the policy-making process. It ensures that Ministers and senior officials hear a full range of views from those who will be affected by government decisions. It is important that everyone’s voice is heard in Westminster and Whitehall. No one should be discouraged from making their views known to decision-makers. There has been some concern, however, that some lobbying activity is opaque and there is a perception that certain powerful organisations and individuals could exert a disproportionate influence on government. The Government have already taken steps to address those concerns by increasing the transparency of decision-making and the accountability of decision-makers, such as Ministers and senior officials. We are the first Government to proactively and regularly publish details of ministerial meetings, government procurement and other items of public interest. I am sure that noble Lords will agree that the interests of those who seek to influence decision-makers should be equally transparent.
For the first time, details of all Ministers’ and Permanent Secretaries’ meetings with external organisations are published on a quarterly basis. The statutory register of lobbyists is designed to address a specific problem within that context, which is that it is not always clear whose interests are being represented by consultant lobbyists. That is the specific policy gap which the register is intended to fill. It will do so by requiring those who are paid to lobby Ministers and Permanent Secretaries on behalf of a third party to disclose the names of their clients on a publicly available register. Our objective is to ensure increased transparency without discouraging engagement by those who will be affected by policy and legislative decisions, such as businesses, charities, community groups and members of the public. Our provisions for a statutory register constitute a pragmatic and proportionate solution designed to address a specific identified problem. The coalition Government made a commitment to introduce a statutory register of lobbyists and to increase transparency in public life. Part 1 will fulfil that commitment.
Lord Foulkes of Cumnock (Lab)
My Lords, can the Minister explain how Mr Lynton Crosby and his tobacco industry interests will be covered by this Bill?
Viscount Younger of Leckie
I do not intend to go into that at this particular stage.
Viscount Younger of Leckie
I note, however, the point that the noble Lord has made.
Let me now turn to the second part of the Bill. Part 2, put simply, requires those who want to influence the outcome of a general election to be transparent in doing so. The changes proposed update a system of regulation which has been in place at the past two UK parliamentary general elections.
Noble Lords will no doubt be aware of the influence that third parties can have on elections. This influence is often very positive, but we believe it should be proportionate. Despite existing controls, there is a real risk of distortion by those who seek to unduly influence the outcome of the election. The Bill takes forward a number of important measures to prevent this occurring.
Expenditure will now be more fully recorded and disclosed. Donations to third parties will now have to be published in advance of an election, rather than after. Certain third parties will also have to provide a statement of accounts. The spending limit for third parties will be lowered. Thirteen years ago, the existing spending limit was fixed in legislation at 5% of the maximum campaign expenditure limit for political parties. This amount was considered quite generous by the organisation that recommended it, the Committee on Standards in Public Life. The committee also noted that groups of third parties could outnumber expenditure by candidates or political parties. That argument remains valid today. Reducing the limit to 2% of the maximum campaign expenditure limit for political parties combats the risk of third party expenditure being used to influence elections. The reduction to a lower, but still very significant, sum is justified. To that same end, the Bill also introduces a measure that will prevent third parties directing the entirety of their spending limit at a single constituency or local area. It will become more difficult for large, well-funded campaigns to overwhelm the local political landscape.
The test for determining if a third party’s expenditure is in fact controlled expenditure is the same in both the Bill and existing legislation. Only expenditure that can,
“reasonably be regarded as intended to promote or procure electoral success”,
of parties or candidates will be regulated and count towards a third party’s spending limit.
Currently only expenditure on election material is regulated. This Bill extends the range of activities that are regulated to other activities such as public rallies and organised media events. This is the same list that applies to the activities of political parties. It implements a very sensible recommendation by the independent regulator, the Electoral Commission.
I should also make clear what this Bill does not do. Noble Lords will be aware that some charities and other organisations have expressed concern that the Bill will prevent campaigning on policy issues. I can reassure the House that only those campaigns that promote electoral success will be regulated.
It is the Government’s belief that the vast majority of charities or other groups campaigning for their preferred policies will not be affected by the Bill. This belief is based on the guidance of the Electoral Commission and its experience of regulating third parties at the 2005 and 2010 UK parliamentary general elections. At those elections charities and other campaign groups were not prevented from engaging with, commenting on or influencing public policy.
No elements of this Bill will deprive third parties of the ability to make a contribution to political debate. The regulatory requirements strengthened by this Bill are proportionate. Third parties will not be precluded from campaigning. They will simply be brought into an enhanced spending and donations reporting regime. As a result, the process as a whole will become more transparent.
I now turn to Part 3, which addresses a gap in enforcing existing duties. Section 24 of the Trade Union and Labour Relations (Consolidation) Act 1992 requires unions to maintain a register of their members’ names and addresses, and, so far as is reasonably practicable, to keep it accurate and up to date. I hope noble Lords will agree that this measure always was, and remains, reasonable.
Under the Act, however, union members, employers and the public cannot be wholly assured that a register is up to date. The Bill therefore requires unions to provide an annual assurance to the certification officer. Those with more than 10,000 members will be obliged to appoint an independent assurer. The Government are keen not to inhibit the operation of small unions—
Lord Lea of Crondall (Lab)
I thank the noble Viscount for giving way. Does his last comment imply that certification officers have had problems with the current regime?
Viscount Younger of Leckie
One of the issues that we wish to address is the fact that the certification officer has a passive mode so that anybody who wishes to make a complaint can do so, but only if he is a union member.
As I was saying, the Government are keen not to inhibit the operation of small unions, so those with 10,000 or fewer members will be required to submit an annual self-certification that their membership list is up to date.
The Bill will also enable the certification officer proactively to investigate possible discrepancies in the register. He will be able to require documents to be submitted and to appoint an inspector. If a union is non-compliant with the duties in Section 24, the certification officer may make a declaration and a civil enforcement order. Unions will always be given an opportunity to make representations before a declaration or order is made.
I look forward to these measures benefiting from the scrutiny of noble Lords. The Government are committed to implementation which is both effective and proportionate, and we will support the transition by producing guidance. I am aware of concern regarding the impact of the proposals, and I hope to reassure noble Lords now. First, I reiterate that the Government are not challenging the vital role that unions play representing their members’ interests and contributing to public debate.
Secondly, I reassure noble Lords that these proposals do not breach human rights to privacy or freedom of association. If a union is non-compliant with duties under Section 24, it is important that every opportunity is given for that to be remedied. The investigation powers will be proportionate: the certification officer can require information only where he deems there is good reason to do so. Existing safeguards in the Data Protection Act and the Human Rights Act will apply as they do elsewhere. The Bill also includes additional protections to prevent the unauthorised disclosure of member data. These provisions will not allow employers unauthorised access to such information.
I believe that these proposals are reasonable. By proactively providing an annual assurance, unions will give even greater credibility to the important voice that they have in public debate. I also hope that unions themselves will recognise the benefit: many unions have up-to-date registers but there is anecdotal evidence of doubt that that is always the case. The annual assurance process will bring greater credibility in future about the result of ballots; for example, in electing a new general secretary.
This Bill will shine the light of transparency on those represented by consultant lobbyists as they meet key decision-makers in government. This Bill brings further clarity on the influence third parties have on the outcome of elections. This Bill will provide assurance that trade unions have accurate membership records, given that their influence extends far beyond their members. This Government believe that transparency generates accountability.
Lord Martin of Springburn (CB)
I thank the noble Viscount for giving way. I am just seeking clarification. I do not need the answer today, but perhaps the Minister can look into this. I recall there were some cases where lobby journalists who held credentials as journalists doubled up as lobbyists and perhaps serviced some all-party groups. That is a very bad practice and something that should not continue. Can the Minister tell the House whether this practice would be allowed under this legislation?
Viscount Younger of Leckie
I thank the noble Lord for that very specific question. I think that it makes sense for me to come back with a full answer.
To conclude, the Government believe that transparency generates accountability and that accountability allows the public to hold public bodies to account. This Government want to be open, transparent and clear on who influences the political system. I commend the Bill to the House, and I beg to move.
Baroness Hayter of Kentish Town (Lab)
My Lords, I thank the Minister for his brave attempt to introduce this bad little Bill and certainly look forward to the maiden speech of the noble Lord, Lord Horam, who has been in both my party and that of the noble Lord, Lord Wallace, but now resides on the Conservative Benches. I may end his career by saying that he gets 12 positive mentions in my book on the Labour Party in the 1970s.
Alas, the Bill will get no positive mentions in anyone’s memoirs. Three years ago, we were promised a statutory register of lobbyists. Instead, we have a skeleton register of only consultant lobbyists, exempting 80% of the industry. The word “transparency” in the title is a misnomer. It misses most lobbyists—HS2, Heathrow, the trade associations, the ABI, the BBA, British Gas, npower and the pharmaceutical, defence, tobacco and sugar manufacturers—as they all have in-house lobbyists; and it misses most of those being lobbied. It covers only Ministers and Permanent Secretaries, not senior civil servants, spads and chairs of Select Committees—the name Tim Yeo comes to mind—so defence firms can continue to lobby senior civil servants behind closed doors, untouched by the Bill.
The Bill contains no code of conduct, so any sanction would be only for non-filing of returns, not for unethical behaviour. Without a code and effective sanctions, the Bill will fail to drive up standards.
Furthermore, the Bill is just silly. Anyone who wants to use a lobbyist has only to employ that person directly rather than through a consultant, and then that person does not have to register. The leader of the Commons says that this is to know, when a Minister meets a lobby firm, who its clients are, but he could do that by a flick of the wrist. He simply has to tell Ministers, as they publish their diaries, to name not just the lobby firm but the client on whose behalf the meeting took place. He could do that by 10 o’clock tonight. Instead, as the CBI says,
“any register must go hand-in-hand with strengthening existing reporting of ministers’ and senior officials’ meetings”.
There is nothing in the Bill on that.
Perhaps most pernicious, the Bill hits the small body, not the big. The House knows that I had a certain interest in minimum alcohol pricing. Drinks companies can lobby via their own public affairs staff, but tiny Alcohol Concern, too small for an in-house lobbyist, must use an agency, which must then register. The same is true with plain packaging of cigarettes: Forest can lobby in secret, but should ASH want to use a PR firm, it would have to register and report. That is nonsense.
Just about everyone considers this to be a non-register and that it should instead include paid, professional lobbyists, not simply third-party consultants. As the Law Society of Scotland put it, to apply different rules to different levels of lobbyists may obscure transparency and give rise to confusion by the public, who are unlikely to differentiate between consultants and in-house lobbyists and, because it does not cover lobbying of MPs or civil servants below Permanent Secretaries, it would dilute the objective of true transparency. The Law Society of Scotland is hardly a suspicious, left-wing organisation.
Indeed, the register would list only a tiny proportion of those already on a voluntary register and undermine the good work of professional organisations, such as the Chartered Institute of Public Relations, which states that the Bill,
“shows a clear lack of understanding of what the practice of lobbying actually entails”,
and will leave out a majority of lobbyists. The Bill fails to support the existing PRCA industry code of ethical conduct and will tell us nothing about who is lobbying whom on what.
Turning to Part 2 of the Bill, there was no prior consultation with the Electoral Commission which will have to police it, or with the organisations concerned. The Electoral Commission, the Political and Constitutional Reform Committee, the Joint Committee on Human Rights, your Lordships’ Constitution Committee and the chair of the Equality and Human Rights Commission all criticise the rush, the absence of pre-legislative scrutiny and the potential impact on rights to freedoms of expression and of assembly. Is this to stop charities campaigning, because if so what is the mischief that it seeks to end? The chair of the Political and Constitutional Reform Committee calls it a solution in search of a problem, for there is no evidence of any problem. Or is this simply about Mr Clegg, afraid of the NUS in Sheffield in 2015, given his broken promises on tuition fees? In that case, perhaps we can rename the Bill the “Sheffield Hallam Retention Bill”.
Or is it the British Legion that the Government have not forgiven for defeating their attempt to abolish the chief coroner? Maybe it is the Association of Medical Royal Colleges, which will no longer be able to print its manifestos in Welsh thanks to the ridiculously low limits. Given that the Electoral Commission says that policy campaigns could be covered, the Law Society is concerned that its comments on legal aid, access to justice and the Human Rights Act will be caught by the Bill. The BMA is similarly deeply concerned, as, should tobacco control become an electoral issue, its campaign could be caught, silencing serious public health arguments. Not for nothing has Tom Burke, chair of E3G called Part 2,
“misconceived in intent, carelessly drafted and being promoted with such indecent haste as to call into question the motives of its promoters”.
Our own Constitution Committee warns that it will affect the fundamental common law right to freedom of political expression, and the ability of people and organisations to engage with the Government and to participate in political and electoral campaigning.
A large number of faith-based bodies, including the Salvation Army, World Jewish Relief, the Methodist Conference, Islamic Relief and the Quakers wrote to the Prime Minister, not only about the rushed timetable but about their fears that it might,
“curtail our ability to express deeply-held beliefs in the political arena”,
as it,
“does not adequately safeguard the activities of religious organisations, and that there is a very real risk”,
to “non-biased political activity.”
Why is there all this additional red tape, and costs on charities? The Heavy Reporting Requirements will start in May 2014, and include weekly returns during the short campaign. This is hard enough for a political party with all the procedures set up to do this and challenging for a large charity with a big back-office function. It is impossible for charities with volunteer treasurers.
The Government, we thought, wanted to encourage the big society and active citizenship. Yet, as the Hansard Society has said, when public interest in politics is at its lowest point and fewer than 1% are members of a political party, this is hardly the time to throw an ambiguous rulebook at organisations whose activities might actually interest the public in the political process. The RSPB reckons that it is illogical to halve the threshold and caps at the same time as widening the activities that count towards them, and that this could seriously curtail legitimate charitable work. The National Trust fears that it could undermine its ability to perform its statutory role to promote the preservation of places of natural beauty and historic interest. It is concerned that this law could restrict the contribution that charities make to public policy debate. Oxfam, which would probably have to identify donors and the reason for their donation, says the Bill could have a severe impact on its work. The Newcastle Council for Voluntary Service fears the Bill is trying to gag it. It is involved in the Living Wage Campaign, studying the impact of government policy on local charities, and working with disability charities to minimise the impact of welfare reforms on users. All fall within its charitable objectives, yet all could fall subject to the Act.
The Bill’s uncertainty and its chilling effect will dampen the enthusiasm of local groups for campaigning since, as soon as they consider spending more than £2,000, or £5,000 in England—including voluntary and staff time, and travel—they will have to enter the nightmare of registration. Furthermore, any mistakes and we are talking criminal not civil sanctions, although whether this places trustees or staff at risk has yet to be clarified.
The Bill fails to live up to the aims of the Open Government Partnership, whose conference I understand that Francis Maude will chair next week. It is committed to freedoms of association and expression, and to the opening up and safeguarding of space for civil society to engage with government. This Bill does exactly the opposite. It seems designed to stifle engagement and make it harder for civil society to play a role.
Finally, what on earth is Part 3 about? It arrived with no prior consultation and following no complaints. The Leader of the Commons admitted that there is no evidence of inadequately kept trade unions records, so is this part simply trying to bankrupt unions by giving them an extra level of audit? This comes from the Government who are promoting a deregulation Bill. What have this Government got against working people and their representatives? They will do anything for business, announcing this month:
“Form filling for companies ditched in red tape cut”,
which a Minister trumpeted was about:
“Cutting unnecessary bureaucracy and red tape for businesses”.
But if there is any chance to clip the wings of employees’ representatives, they simply cannot resist. Perhaps the Minister can explain why, out of all the myriad professional, trade, social, legal, civil society, medical and other membership organisations, the unions alone are picked out by the Bill.
The Bill allows companies unfettered access to Ministers and Parliament but imposes restrictions and red tape on charities and unions. It has managed to unite the TaxPayers’ Alliance, the Countryside Alliance, the National Secular Society, faith groups, Business for Britain, the Peter Tatchell Foundation, the Women’s Institute and the Woodland Trust. They are all in opposition. I congratulate the Government on that achievement.
Part 1 fails to deal with the lobbying problem, Part 2 deals with a non-existent problem and Part 3 deals with a made-up problem. The Government would be well advised to pause as recommended by the Joint Committee on Human Rights, by the churches and faith groups which wrote to the Prime Minister and by just about every commentator. They should think again, consult, listen and then come back with a much better Bill. If they fail to do so, we will work in Committee and on Report to make this Bill better and workable.
Lord Tyler (LD)
My Lords, in many years of public life I cannot recall a set of proposals that have been so misunderstood and, to some extent, misrepresented. I hope that during this debate, and particularly in Committee, we will be able to reassure the many charities and smaller campaign groups that have been in touch with us that the Bill is not about stopping them contributing to our democracy. As my noble friend the Minister said, the target is the very wealthy and powerful interests that would seek to influence executive decisions and our elections, and which evidently feel threatened by greater transparency. I am interested to see that some charities that have been in touch with me now see that they have more of a problem with charity law than with the Bill. They may have to look carefully at the intentions of the Bill and at the detail of the charity law with which they may have a problem.
The Bill is a first, essential step towards taking big money out of politics: an issue that has been with us ever since Bernie Ecclestone, the tobacco lobby and Formula 1 was brought to our attention in the early years of the Blair regime. That has obviously increased our awareness of the threat to our democracy. I recall that the noble Baroness, Lady Royall, urged the Government to introduce a lobbying Bill in her contribution to the debates in May—and I endorsed her request. Ironically, she referred specifically to the tobacco lobby and to the Murdoch empire. Her colleagues in the previous Government have good reason to remember both those organisations.
I think that it was the present Prime Minister who said that sunlight was the best disinfectant. As the Minister said, important steps have already been taken to increase transparency in Whitehall about who is meeting whom. However, the Bill will take that a step further, and if we can improve it further again by building on the register, as I will come to in a minute, that will be a very important step forward.
Part 2 deals with the considerable potential threat from “super-PACs”, which are now so evident in the USA. We have to face up to the fact that the capacity of millionaires to set up organisations that could each spend £793,500 in England—and do so in just one constituency if they chose to, under present law—could have a major impact in distorting results.
I am alarmed to note that I have contested some 12 elections, and on each occasion have been advised, on pain of serious penalty, to watch every penny spent in support of my candidature. On one occasion, however, when I was defending a majority of just nine votes, I was targeted by a shadowy pro-apartheid group that helped to secure my subsequent defeat. I want to see that type of activity brought into the light of day, and the Bill will start that process.
On Part 1, if I may go into a little more detail, I also have some practical experience since at one time, before politics took over, I had a real job as the head of a public affairs consultancy advising NGOs, environmental organisations, local government and trade associations—what I suppose would now be described as lobbying. The Government’s intention—rightly, in my view—is not to regulate lobbying but to ensure that the sunshine is very firmly imposed on it. We need to know who has the ear of Ministers and other decision-makers. To my mind, including in-house lobbyists would be a red herring and would create a huge telephone directory-style registry, including a huge number of people who would actually be irrelevant to greater transparency. It would not improve the extent to which we could see what was actually going on, because it would lose the wood for the enormous forest of trees, and hide in plain sight what was being done in the name of those paying for it to be done.
Meeting data about interactions with in-house lobbyists are already published, as my noble friend said, and if Oxfam or even Tesco meet a Minister, we know whose interests they are promoting. However, this could of course be greatly improved with a central database, an easily accessible online front end, through which anyone—the media, individual citizens, Members of your Lordships’ House—could establish who has met whom in Government, and indeed what the subject has been at what stage, without, as is currently the case, having to go through 60 different Excel spreadsheets, each parcelled away in different obscure parts of departmental websites. The key to transparency is easy access and simplicity, and the register is a very good first step in that direction.
During the passage of the Bill I will examine two key areas for the improvement of Part 1. First, as has already been referred to, we have to ensure that the meetings of special advisers, who are not directly responsible to the Permanent Secretaries in the same way as other members of the Civil Service, with any consultant lobbyists who have interacted with them are appropriately registered. We should remember that two of the most dramatic scandals involving privileged access in recent years involved ministerial advisers rather than Ministers themselves. Secondly, we have to look very carefully to see how the new statutory register can complement existing voluntary arrangements. The register that the Government propose is deliberately a statutory minimum, but surely it would be perverse if lobbyists then departed from their responsibilities under existing codes put in place by the UK Public Affairs Council.
As I said earlier, there has been a great deal of understandable misunderstanding, but some mis- information as well, about Part 2 of the Bill. I suspect that other Members of your Lordships’ House over recent weeks—in my case, over recent months—have been receiving e-mails referring to a supposed threat to freedom of speech. This is not a gagging Bill; it concerns itself not with what people say but with what they spend. That is the critical issue.
Those of us who have experience of electoral law know that that principle has been there since 1883, since people back in the 19th century were very concerned about buying votes. I cannot see why anyone who is attempting to influence the outcome of an election—to buy votes, if you like—who happens not to be standing as a candidate, should be able to spend unlimited sums on,
“promoting or procuring electoral success”.
As has already been made clear, that definition has stood four-square in two general elections, and MPs have done the right thing in returning to it.
The current definition in Clause 26 of activities that,
“can reasonably be regarded as intended to promote or procure electoral success”,
for a party or candidate, has been in place since PPERA 2000. The Commons rightly agreed to take out the rather vaguer phrase about “otherwise enhancing the standing” of parties or candidates.
I absolve the noble Baroness, Lady Hayter, of any responsibility for the 2000 Act, since I do not think that she was directly involved then. However, many of us at both ends of this building were involved. We should assure her that it has stood the test of time. We took infinite trouble in both Houses to get the definition right. Surely it is ridiculous to say at this stage that the definition is defective, as she implied. If it had been so defective, surely the Electoral Commission, with its practical experience, would have recommended over many years that it needed updating, and, presumably, the Labour Government of the day would have implemented the recommendation. Can we at least accept that the definition stands four-square and is accepted on all sides?
I accept that there is quite a different issue when we come from the definitions to the spending limits, which are at present probably indefensible. The total limit for the United Kingdom is just shy of £1 million. The English limit of £793,500 could be focused on just one constituency. What if the oil companies decided to target a certain Brighton constituency to remove a Green MP, or other interests piled into a few seats held by Members of Parliament opposed to the review of the Hunting Act—which is a practical proposition—or piled into constituencies of prominent Conservatives who happen to favour continued United Kingdom membership of the European Union? The Americans have been teaching many people in this country how to target with big money.
In the past few days I have met representatives of the RSPB, Countryside Alliance, Transparency International, 38 Degrees and Friends of the Earth, and have discussed the situation with many others, through the good offices of the commission of the noble and right reverend Lord, Lord Harries, to whom I pay tribute. All the organisations seem to agree that the existing regulations may be flawed, so the question is how to get the revised regulations right.
For example, the threshold for registration is obviously a big concern for these organisations. You could plot on a graph transparency on the one hand and bureaucracy on the other in very many areas of life. If transparency is low, the regulatory burden tends to be low, too. If accountability is strong, it is likely that the regulatory burden will be significant. The threshold is a question of where we plot this legislation on that graph. The lower thresholds proposed by the Government will improve and increase the accountability of campaign spending. Conversely, they inevitably increase the burden on smaller organisations. It will be our responsibility in your Lordships’ House to get the balance right when we come to Committee.
The second area of concern among a number of organisations is Schedule 3. These provisions flow directly from the Electoral Commission’s recommendation that the activities for which non-parties should have to account should be the same as those for which parties have to account. In that, it is perfectly reasonable to question how staff costs should be applied in the schedule. We will all listen to what the groups say about this and will probe the matter in Committee.
Reference was made to the way in which the Government’s proposals have been examined. Obviously, I think that we would all agree that if timing had permitted, pre-legislative scrutiny would have been desirable. However, the cross-party talks—of which I have direct knowledge—between the three major parties on the area of political funding effectively prevented this. It may well be a criticism that the Deputy Prime Minister should have realised that he was being strung along by the other two parties—that they were not serious about getting a result. However, given that they could not come to an agreement, it was obviously important to move on this particular issue, which was also agreed between the three parties.
Baroness Royall of Blaisdon (Lab)
My Lords, can I nail the myth that is going around that was perpetuated by the Deputy Prime Minister in the Commons last Tuesday? There were no substantive talks at all on third-party funding in the talks to which the noble Lord refers. Far from the current proposals being discussed extensively, they were never raised, never proposed and never discussed. Also, the talks did not break down; they ceased but they did not break down. I wish the noble Lord would not keep perpetuating that myth.
Lord Tyler
My Lords, my information is different on both points. We can have a further discussion after this debate. There was, of course, agreement between the three major parties that there was a need to address the issue. I hope the noble Baroness will agree on that, because there certainly was. Since then, unfortunately, there has been a tendency to jump on the bandwagon.
Meanwhile, there has also been a repetition of the idea that somehow the Electoral Commission was never involved in the exercise. As I have previously told your Lordships’ House, I have served on an informal all-party advisory group for the Electoral Commission for some years. It is simply not accurate to say that the commission has made no contribution to the thought process that led to this Bill. I will quote two warnings given by the commission in February 2013, under the heading, “Regulating Third Party Campaigning in the UK”. The first states that,
“the rules on general campaigning that is intended to influence voters should reflect the rules for political parties by covering events, media work and polling, as well as election material”.
The second states that,
“the Government should have order-making powers to update the rules on general campaigning, in order to deal with changing campaign methods in future”.
In the months that followed, between February and the publication of the Bill, there was indeed a continual dialogue, and I have a letter from the chair of the commission to confirm that. It is perfectly true that it was not consulted over every single part of the Bill, but a general dialogue continued about the necessary modernisation of the regulatory regime. I think that most Members of your Lordships’ House would say that it is preferable to have full scrutiny of a statutory process than to have a change in ministerial order-making powers.
Our duty now is to get the detail of the Bill right and to reassure those charities that have been unduly concerned. In particular, we will have to be satisfied that registration thresholds, the scope of Schedule 3 and the expenditure limits strike the right balance between transparency and bureaucracy. Delay will not help those who are concerned with this detail. Campaigners need time to assess their plans for the run-up to the May 2015 general election—and, of course, the Electoral Commission needs certainty so that it can give good advice. That is why it recommended opposition to the delaying tactics proposed in the other place.
Your Lordships’ House has an excellent reputation for detailed scrutiny. I hope there will be agreement today that we should get on with that job. This can be a good change in the law that will shine a light on a small but significant area of opacity in lobbying and will prevent the distortion of our politics by wealthy interests.
Lord Ramsbotham (CB)
My Lords, the Joint Committee on Human Rights has already said that this is a very bad Bill, querying why it is being rushed through without proper pre-legislative scrutiny or scrutiny in the other place, and, I would add, without consultation with an affected contributor to the life of the nation, whose contribution is needlessly and avoidably being put at risk.
The Government allege that the aim of the Bill is to restore trust and confidence in the political system by ensuring that the public are able to see how third parties seek to influence it. Other noble Lords will speak on other aspects, but I intend to concentrate on what I hope are the unintended consequences of what is being proposed in Part 2 for one part of a sector that has never sought to influence electoral law but, rather, works hard to try to protect the public. I will not mince my words, because, given the indecent haste with which the Bill is being processed, there is no point in doing so. I believe that the Government should withdraw Part 2 of the Bill now or, at best, submit it to the consultation that has hitherto been denied before bringing in whatever legislation they then feel appropriate. In terms of the voluntary sector, I suggest that need be nothing more than minor amendments to existing arrangements.
I shall try to illustrate my reasoning by referring to those charitable and voluntary organisations that work in the criminal justice field. At present, the Secretary of State for Justice is seeking to implement what he calls a rehabilitation revolution. At the heart of this, he seeks to reduce the appalling reoffending rate, which is impossible to measure, by awarding contracts to private and voluntary organisations that will be paid by their results. The work that they do with and for offenders will be funded either by social impact bonds, taken out by investors, or the private and voluntary organisations themselves in the hope that they will be successful and so earn payment.
Contracting the voluntary sector is not something new to this Government, but the method is deeply troubling some members of both parts—foundations and trusts, which fund organisations, and the organisations themselves, some quite large and some tiny, which do the work up and down the country, for which they seek funding, either from foundations or trusts or from private donations. The Government call this a partnership, but one ingredient of a successful partnership is mutual trust. The Government must bear in mind that, as at least 50% of rehabilitation work is done by the voluntary sector, they must not do anything that undermines its ability or willingness to contribute to that work. Above all, the Government must avoid giving the impression that they think they own the voluntary sector—nor must they forget that donors do not give money to fund a contracting process; they give it so that the work that they wish to support can be conducted.
While some organisations may involve themselves with policy—indeed, some exist to conduct and publish research and recommendations—that is directed at whichever political party is in power, and in no sense can it be described as electioneering. Even if they were tempted to involve themselves, they are prevented from doing so by the current system of checks and balances, with regulation by the Charity Commission, including a document called CC9—Speaking Out Guidance on Campaigning and Political Activity by Charities, which sets out clear, sensible and balanced rules; guidance by the Electoral Commission on campaigning in the run-up to elections, including rules about supporting candidates and parties; and the fact that all charities must prepare accounts, which they must make available on request. Therefore, I believe that the restrictions on this most important activity by those in support of the criminal justice system that are implied in Schedule 3 of the Bill are not only inappropriate, because they are already more than adequately covered, but potentially damage the protection of the public.
When it is looked at logically, I am amazed that the Secretary of State for Justice did not seek to have Part 2 of the Bill suppressed because of its potential impact on his revolution, not least in the damage that the proposals are doing to the very trust and confidence that the Government seek to promote in the voluntary sector, which has always enjoyed the precious freedom to speak out on key issues, injustices and public concerns. So bad is this part of the legislation that it is unclear which work is classified as electoral campaigning, as opposed to publicising the public nature of work being done on behalf of the public. It is unclear before which election time limits are to be imposed—and there are elections of some sort in different parts of the country almost every year. It is at best difficult to attribute staff costs to different work streams, and small organisations find existing regulations time and money consuming enough now, every penny being spend on bureaucracy being denied to actual work.
I will not go on, because I have no doubt that other noble Lords will add to this catalogue during this debate. Whatever they may feel about lobbyists, I implore the Government to think again before they inflict unnecessary damage on one of the jewels in our national crown, our charitable and voluntary sector.
The Lord Bishop of Derby
My Lords, I, too, want to comment on Part 2 from the perspective of charities and faith groups and the scoping out of a framework in this debate for further work. I declare an interest as a trustee of Christian Aid and as chair of the governors of the Churches’ Legislation Advisory Service, the secretariat service of which comprises Central Lobby consultants who will have to register under Part 1 of the Bill.
I recognise that the Government are trying hard to listen to concerns about Part 2. Like others, I have been in correspondence with the Leader of the Commons and his team. However, as the noble Baroness, Lady Hayter, and others have said, the Constitution Committee noted:
“The provisions of Part 2 directly affect the fundamental common law right to freedom of political expression”.
That is a very serious challenge to these proposals. As has been said, concern has been expressed by the Electoral Commission and the Joint Committee on Human Rights. Therefore, this question is raised not just by people like me from the faith and charity sector but by some very weighty, much more expert people. I ask the Minister to comment on three of the major tests for regulating transparency: the test of influencing electoral outcomes; the test of levels of financial expenditure; and the test regarding the constituency as a measure—three of the key tests.
First, as regards the test of influencing electoral outcomes, what is at stake here is not the transparency of lobbying but the danger of trying to control politics and standardise political debate on the single model of political parties, which are only one part of the mix. The Bill is part of a process whereby politics has been professionalised. This House is part of that process as many Members are full-time professional politicians. That has led to high standards and enormously sophisticated legislation, but at the same time politics has taken an inward turn to the pragmatic and is less guided by the big visionary ideologies of the past. The result of politics becoming professionalised and pragmatic has been disastrous for democratic politics because the demos, the people, have just walked away. It has become so professional, detailed and dominated by experts and expert groups wanting smart outcomes, that the great public, as we know, have retreated into personal space to get on with life and cannot even be bothered to turn out at elections. Democracy is in crisis in our culture and we need to read these proposals within that framework.
Professional lobbying groups with sharp, smart outcomes are filling the space of working politics and ordinary people with political instincts are being excluded. What we lack in politics, it seems to me, is a space for the amateur, those with occasional engagement and people interested in particular issues. Very few people are members of political parties or of the professional lobbying groups that pursue political lobbying in a smart way, but millions of people are involved in charities and faith groups. The importance of all those millions of people is that we gather together in faith groups and charities to pursue goodness for ourselves and others, and that is a political energy. People want to do good for their neighbour, community and country. That is political energy. It is often concerned with big issues and principles and is often vague and unformed, but surely the task of a Government and their legislation should not be to close all that down and put it in a box that looks like another political party but to listen, interpret and help shape that energy so that it can create goodness appropriately and people can be encouraged to be part of a nation and its political culture.
We should be delighted that people from the charitable and faith sectors are making all this fuss. They are interested. They have political energy for goodness. My concern is that the proposals under the test of influencing electoral outcomes are predicated on a very narrow, party-political approach to how politics works. Under this test, will the Minister comment on free speech and freedom of assembly? Does the Minister accept that charities and faith groups bring a different kind of political energy? One that is vital and needs encouraging and cannot be bureaucratised into processes and ways of operating that have suited political parties—in the past at least—but do not suit this particular kind of energy.
Secondly, what does the Minister say about charities and faith groups convening hustings—meetings—to discuss political issues? The proposed regulatory framework might make this subject to registration, putting in accounts and all that kind of thing. There is a great aspiration from this Government for a big society, which I believe in. The danger of these proposals is that we are bringing into effect a Big Brother society where all the little details are imposed on people from a very narrow model sapping political energy and making it more difficult for people to contribute.
Thirdly, under the test of influencing electoral outcomes, will the Minister comment on the space that will be given to religious leaders to make statements and put things out on the web in an election period? Will there be controls on that kind of proactive engagement?
More rapidly, on the second test of levels of financial expenditure, can the Minister give a rationale for the level of financial controls that have been set for the charitable, voluntary and faiths sectors? Why is there a financial measure for energy that is so often less focused but equally vibrant? Charity law provides a well established regulatory framework for the political engagement of this sector. Why have we brought in these lower thresholds that bring a bureaucratic control and pressure on the free-flowing energy of political concern among the wider public? What is the rationale for extending the scope of controlled expenditure on third parties? Why has the financial tool been used when we could have explored current charity law and how to develop that in terms of responsible and transparent operating?
The third test is the use of constituency as the measure. This may just show my ignorance of how politics works. I can understand the need for a constituency to order voters in a particular mass so you can count them. However, in an age of social media how are you going to measure the geographical influence of anybody, even if they are in somebody’s constituency? How are you going to measure whether it affects people over the border or has come from somewhere else? Freedom of association has a very different meaning in the virtual age. I would have hoped that this legislation would have thought about that creatively but the test of a constituency and its effect is a rather crude and simplistic measure. Will the Minister give a rationale for the constituency test and the criteria that can really be used to make an informed judgment when all this stuff flies around the internet all the time?
We need transparency for professional lobbying and for political parties but we need transparency, and that is openness, in political debate. We should rejoice that so many charities, faith groups and voluntary groups want to be involved. They are subject to regulation in the political sphere through our tradition of charity Acts. Politics needs this political energy for the common good and all the signals—as we can tell from our e-mail inboxes—are that this source of political energy is being closed down and discouraged at the very time we are wringing our hands because the great public are not interested in political parties, elections or the democratic process. So I, too, hope that there will be a pause, and that the Minister will be willing to sit down with representatives of charities, faith and voluntary groups to look at proper controls and accountability. There must be accountability. How can it come out of the existing charity law, and how can we minimise bureaucratic, financial and geographic tests?
We must encourage and celebrate political debate and commitment. The task of politicians is to enable that and to listen to and interpret it, helping it in all its wild generality and off-beamness to find a way of contributing and helping the country to get a proper sense of direction and a proper buy-in from its citizens.
Lord Lang of Monkton (Con)
My Lords, it is a pleasure to follow the right reverend Prelate the Bishop of Derby. As we are debating a lobbying Bill, I suppose that I should declare my interests. I had the honour to chair the Advisory Committee on Business Appointments, which is much concerned with lobbying, and to be a member of the Select Committee on the Constitution. Both, in a sense, are marginal to the central debate surrounding this Bill, but the Select Committee criticised, with good cause, the unnecessary speed and lack of advance consultation with which the Bill was introduced in another place. I believe that undue haste is bad government. The matter was three years in gestation with no draft Bill, no White Paper and no consultation, and unsurprisingly therefore the content has been widely criticised. This, I believe, should be, as the committee said in its report, a matter of significant concern. Indeed, it baffles me that Governments should behave in this unnecessary but highly provocative way.
I know that, because of that, Part 2 of the Bill has aroused great concern—we have heard much of that already in this debate—especially among charities. Of course, Part 3 was always bound to attract a certain amount of interest from the party opposite, but in the time available I propose to confine my remarks to Part 1.
While the Bill aims at professional consultant lobbyists, the Advisory Committee on Business Appointments focuses on individuals. We are concerned with Ministers leaving government and senior civil servants leaving or retiring from the Civil Service, and that embraces ambassadors and senior military personnel. One of our tasks in considering their applications to us is to prevent them, when taking up subsequent appointments, whether with industry, commerce or even charities and consultancies, lobbying their former colleagues or government in general for up to two years. We are concerned with a different part of the lobbying spectrum. It is a broad and divisive spectrum, and therefore we have a different definition of lobbying.
The Bill has another definition because it has a different focus: on corporate lobbying consultancies, rather than on individuals. I believe that definition is all in these matters, and a single, comprehensive definition of lobbying is elusive—indeed, perhaps impossible. As the Government’s briefing note says, and as the Minister said today, its aim is to,
“shine the light of transparency on consultant lobbying”,
not to act as a complete regulator of the industry. That creates anomalies, which I shall come to, but it is probably wise to concentrate on that category in the Bill rather than to seek a comprehensive solution, because lobbying comes in all shapes and sizes and from many different sources. They are not all malign or dangerous to parliamentary democracy. Indeed, the taint that has begun to fall on some aspects should not be allowed to be got out of proportion.
Lobbying in one form or another has been around for centuries. Plantagenet kings held their Parliaments in all parts of England, and they summoned those Parliaments not just to raise taxation for their foreign wars and crusades but to hear the pleas, complaints and concerns of their citizens, to entrench their kingship and, indeed, to enact Acts of Parliament and thus to give form to the rule of law over a period of time.
Ever since then, lobbying has been, and is, part of the life-blood of our parliamentary democracy. We cannot and should not seek to choke it off. Therefore, the Bill is surely right not to try to do that but to focus on the main areas of concern. However, shining the light of transparency, in the best Nolan tradition, on one aspect underlines the lack of transparency in others. It may be that the parameters are too tightly drawn, and that needs to be explained because a spotlight on one sector casts a shadow around about it. For example, the Bill does not include in-house public affairs departments or multiclient firms, such as lawyers pursuing the legal interests of their clients. What of consultant lobbyists who do not themselves lobby government, but who train their clients and advise them on whom to lobby and how to go about lobbying?
On the persons who are lobbied, the focus is put on Ministers and Permanent Secretaries or the equivalent, but does not cover special advisers, who are often well placed to influence government policy. What about those civil servants who are below Permanent Secretary level, but are highly expert and influential in particular sectors of, for example, industry, defence or health and may work closely with major companies in those fields? Ministers and Permanent Secretaries are already required to disclose on a quarterly basis the names of those outside government whom they meet. Has the Minister considered whether an easier, and perhaps more effective, approach to the lobbying issue might be to require anyone in government, whether parliamentarian or civil servant, who is lobbied by discernible commercial interest to declare that in a lobbying register?
I welcome the provisions approved in another place and the clarification in Schedule 1 of the position of parliamentarians. In this House in particular, there are many noble Lords with distinguished careers from which they have derived immense expertise and wisdom who could feel inhibited from speaking on their specialist subjects in this House for fear of being thought, quite wrongly, to be lobbying in some way. I hope that the Bill may help to lift that particular shadow.
In courtesy to the many remaining speakers in this debate I have been relatively brief. I conclude by saying that the Bill as it stands, with its register, registrar and enforcement powers, has a net, but one that will probably catch few fish. It may be enough to draw the sting and the taint from the lobbying issue. I hope so; but if not, it will be something to build on.
Baroness Kennedy of The Shaws (Lab)
My Lords, it is important that we retain some clarity about why there were calls for a Bill to regulate lobbying. It was to deal with the damage to our democracy caused by the introduction of professional lobbyists and the toxic effect of big money. There was general concern that our democracy should not fall into the grip of rich men or commercial interests. I am afraid that both our Houses came under scrutiny because of the ways in which wads of cash and other inducements seem to be waved at politicians to secure favourable policy, or even promises of places on boards at the end of political careers.
There were good reasons, therefore, why there should be calls for a Bill. As citizens, we seek the attention of our politicians to persuade them of our cause, so that the interests and concerns of all sections of our population might be better served. Lobbying is vital to our democracy: it is how we change policy and push for different legislation; it is how we see society evolving and how democracy ultimately works.
Many people in this House have lobbied for change, and without being paid for it. We were active citizens; and active citizenry is what this is about. It is about adding to the social capital that has helped to keep our democracy strong and in good heart; that is why it has had the respect of the world. This Bill grew out of concern that a poison was leeching into our politics.
I am a member of the Joint Committee on Human Rights. We are seriously alarmed that this Bill has been rushed unnecessarily through Parliament and that there has been inadequate time for the proper scrutiny and consultations that are vital for the improvement of any Bill. A whole set of amendments has come from the Government that require scrutiny, but we have not had time to deal with it. There should be further consultations with the Electoral Commission, the Commission on Civil Society and Democratic Engagement, and other relevant stakeholders. We are urging that there should be a pause at some stage to allow that to happen.
The Political and Constitutional Reform Committee has also made recommendations which should have a response from the Government before we go forward. It really is unacceptable that a committee such as the Joint Committee on Human Rights, tasked by Parliament to analyse the human rights implications of legislation, should not be able to report on a Bill until it has left the first House, all because of unnecessary speed, especially when there are issues in this Bill that go to the heart of our democracy—for example, freedom of expression and freedom of association.
This is not emergency legislation or law that requires fast-tracking. It is wrong that the Government have timetabled this Bill in a way that does not allow us to do our job properly, whether on Select Committees or as Members of this House. This is not the first time that the JCHR has had to raise concerns about the inadequacy of time available to scrutinise the human rights compatibility of significant government amendments in relation to Bills. It is a recurring problem, which I am raising so that this House hears it and because it has constitutional implications.
Our concerns with this Bill are serious. It currently is not fit for purpose. More time is needed to ensure that proposals are proportionate and do not have unintended consequences for campaigners’ rights to freedom of expression and freedom of association. The protection of electoral process is a clear, legitimate aim of government. We do not want a United States style system of election spending by third parties. It is important that single-issue campaigners do not have the ability to distort outcomes unfairly by mass injections of money and nor should rich businessmen.
However, we are concerned that lack of understanding about any new rules and arrangements might dissuade charities and campaigning groups within our communities from participating in campaigns, with the potential chilling effect on free speech and freedom of association. Reform of non-party campaigning regulation requires careful consideration and we need time for that. That is why we are recommending a pause in the legislative process, as has been suggested by other Members of this House. We are asking for more time to be allowed for further consideration of the measures.
The pause could take a number of different forms. It could take place before or even after Committee stage. That can be debated. This Bill is being rushed through Parliament and the consequences could be very serious. The law, when it creates unintended consequences, is bad law. One of the roles of this House is to ensure that we do not create bad law. The Government should listen to public clamour—indeed, there is a clamour out there—and I hope that the Minister will act accordingly.
Lord Harries of Pentregarth (CB)
My Lords, perhaps I may say on behalf of the House how much we are looking forward to hearing the maiden speech of the noble Lord, Lord Horam. He brings to the House a great wealth of experience from the other place. He has been a Parliamentary Under-Secretary of State in two departments and a member of a number of influential committees. He also brings a very interesting political trajectory, which indicates his capacity to enter into the point of view of other people and an independence of mind, both of which are characteristics of this House. We very much look forward to hearing more of those characteristics in his maiden speech and in further speeches in the House.
I declare an interest as chair of the Commission on Civil Society and Democratic Engagement. This commission has been set up with the backing of more than 50 churches and campaigning groups. However, due to the extreme speed with which this Bill is being pushed through, the commission has had only very limited time in which to act. Hearings have taken place in Scotland, Northern Ireland and Wales, as well as in London, but our report will not be published until next Tuesday. It will be in time for Committee stage but not for today. Today, therefore, I speak in a personal capacity, although obviously drawing on some of the evidence that has been put to us so far.
My concern, as is that of so many, is the sheer speed with which this Bill is being pushed through. It is a major concern of the Joint Committee on Human Rights, the Political and Constitutional Reform Committee, the Select Committee on the Constitution and the Electoral Commission. There is total agreement—no disagreement at all—that big spending campaigns should be properly regulated. But the changes made in this Bill, compared with what was in place for the two previous elections, mean that charities and campaigning groups feel that their fundamental right to free speech will be severely curtailed. They have not been consulted and nor has the Electoral Commission, which has to offer guidance on the implementation of the law. They have grave doubts about the Bill as it stands.
Part 2 of the Bill, as we heard from the noble Baroness, Lady Hayter, has united an extraordinary number of organisations. I am not going to go through the list but will just mention the National Trust. It argues that its campaigning, which has brought about so many benefits in relation to the countryside which we now take for granted, would simply not be possible under the Bill.
One of the reasons why charities and campaigning groups need to be consulted is that they are key players in keeping our democracy alive. With the drastic fall in political party membership and the indifference of so many to professional politics, it is these groups that arouse people’s interest and help to focus their concerns. At election times it is the churches and charities that organise the hustings. The CARE organisation, for example, was responsible for facilitating more than 300 hustings during the last election. It is the charities and campaigning groups that educate the electorate about particular issues so that they can put intelligent questions to the candidates. Overall they have had a huge influence. It was the churches and aid agencies which combined together to mount one of the biggest campaigns that we have ever seen, on dropping third-world debt. That was followed up with campaigns on the millennium goals and overseas aid generally. These campaigns have influenced all the major parties in a very positive way—how much poorer the world would have been without them. Because of the key role that these bodies now play in democratic engagement and in keeping democracy alive, Parliament needs to be particularly careful about any legislation which affects their ability to do this.
It is said that there are those who resent the role now played by charities in our society. Some apparently would like to confine them to service provision, leaving the formation of political policy to politicians. Whether or not this is the case, it does raise a fundamental question at the outset. Why has Part 2 suddenly appeared? What is the problem it is trying to fix? We are told that it stems from a worry that American-style big-money campaigning such as Citizens United might come over the Atlantic. If that is so, however, it would be easily caught by the present regulations. As far as the United Kingdom is concerned, in the 2005 and 2010 general elections only two third parties exceeded the new lower limit for the election year. In 2005 it was UNISON and the Conservative Rural Action Group and in 2010 it was UNISON and Vote for Change.
No problem has been identified and no reason has been given for this reduction or the rationale for this figure or any other. For the vast majority of charities and campaigning groups, it is the new threshold at which they will they have to register which has given rise to the widest concern. This has reduced from £10,000 to £5,000 a year in England and from £5,000 to £2,000 a year in Wales, Scotland and Northern Ireland. As if this was not limiting enough, the range of activities which will count towards the sum has been greatly widened. Until now it has only been the cost of election leaflets and posters. Now, according to the long list in proposed new Schedule 8A to the Political Parties, Elections and Referendums Act 2000, it will include all advertising and all costs involved in this, all unsolicited material addressed to electors and all associated costs, all expenses concerned with market research, canvassing and provision of services for the media or conferences, transport, travel costs, rallies and public meetings generally.
The scope is exceedingly wide and concerns expenditure over the whole year before an election as well as the immediate run-up to it, including staff costs in so far as they are connected with activities for election purposes which we know, according to Clause 26, are activities which can reasonably be regarded as promoting or procuring electoral success at any relevant election for a registered party or candidate.
There is a huge range of questions raised by this but the overall effect of reducing the limits at which a charity will have to register and the increased number of activities that will have to be taken into account when calculating the cost means that charities and campaigning groups which regard trying to influence public policy as one of their core activities will be seriously inhibited. It is not that they will be spending big sums; on the whole, they will not. However, from the beginning of an election year, if the Bill is approved, they will be very frightened of quickly going over the limit and doing something illegal. Many trustees of charities feel that it is part of their fiduciary duty—or they will do—to curtail severely, if not stop altogether, a range of activities that might be seen to be on the borderline for fear that the charity would subsequently be regarded as acting illegally.
If, however, they decide to take the risk and register, the paperwork needed to subdivide the elements of expenditure and people’s time could be a huge bureaucratic burden on small charities or campaigning groups, especially during the actual election period itself when they will have to produce weekly accounts of any expenditure. The impact assessment calculates that the cost will be only between nothing and £800 for any one organisation, but many charities think that this is a major underestimate of the kind of costs that might be involved.
Lord Judd (Lab)
My Lords, I am very struck by what the noble and right reverend Lord is saying. Does he not agree that the ground he is now covering brings into the light the fundamental contradiction that under charity law, charities are expected to make the best possible use of every penny that is available to them in fulfilling their purposes? This Bill is going to force them to waste it on bureaucracy.
Lord Harries of Pentregarth
That is a valuable point and I thank the noble Lord, Lord Judd.
There is a whole range of other problems. If groups campaign on a particular issue, the total costs involved will be attributed to each charity. Some of the most effective campaigns in recent years have come about because charities have combined. There are particular problems in relation to Northern Ireland, Scotland and Wales, where the sum has now been reduced to a paltry £2,000 in the year. I am not going to deal with that now, but it might emerge in subsequent days.
Time and again we have heard the phrase “chilling effect” being used. Some people say that they cannot understand why charities are worried about it because there will be no curtailing of their freedom. It is the combination of these elements, the lower limits and the increased range of activities that count towards them, together with a continuing fundamental uncertainty about the definition of an electoral activity in practice that is making so many charities feel that their freedom to engage is in fact being threatened. The Government are worried about a large fish across the Atlantic called Citizens United and fear that it might swim over here, but instead of waiting for it to come, they have sent out a deep sea trawler which has thrown up a huge amount of sand and confusion from the bottom of the sea and put a net over charities which have been swimming quite legitimately in the waters of democracy. It seems quite absurd.
There is a case for including a number of activities in what counts for electoral purposes. I think that we can agree on that, although the question of staff time raises all sorts of difficulties, particularly in the case of voluntary time and whether it is workable at all. But what is strange is that all these activities are being brought together—the lowering of the threshold and an increase in the activities that count towards it. Will the Minister explain what the problem is that has given rise to this severe curtailment? It is rather like offering someone a sum of money for a piece of work and then telling them that the amount is being halved while at the same time they will have to complete a number of other tasks in order to earn the money at all. Surely if there were no reported problems before, and the number of activities is to be increased, the thresholds should in fact be raised, not lowered, in order to account for the ordinary activities that charities regard as part of their core duties.
As I have said, there is a logical case for including a lot of these activities, but will the Minister say something about how these charities are to assess volunteer time? The National Trust, for example, has thousands of volunteers. Are they to be taken into account?
Lord Phillips of Sudbury (LD)
I am sorry to interrupt the noble and right reverend Lord, because I agree with every word that he is saying. May I just shoot one canard? It has been raised more than once. Section 87(2)(c) of the 2000 Act says,
“the provision by any individual of his own services which he provides voluntarily in his own time and free of charge”,
shall not be controlled expenditure.
Lord Harries of Pentregarth
I thank the noble Lord, Lord Phillips. I hope very much that the Minister will agree with that.
There is just one other point I would like to make. The noble Lord, Lord Tyler, has suggested that the present definition of an electoral activity promoting or procuring electoral success at any relevant election is accepted by virtually everyone concerned. I think that charities have not in fact been quite so happy about that as he suggests. There is still genuine uncertainty because this is a genuinely difficult area. If, for instance, a campaigning group on climate change looks at the policies of the different parties and assesses them according to whether it thinks that their policies are desirable as far as climate change is concerned, does that count as an activity for promoting or procuring electoral success at any general election? It seems to me that people of good will could argue that either way. Therefore, is there not a need for government lawyers, Charity Commission lawyers and the lawyers of charities to get together to see whether this really is the best definition or whether we can come up with something better?
Lord Tyler
I agree precisely with what the noble and right reverend Lord has just said. As was said earlier by the noble Lord, Lord Ramsbotham, it is charity law that has restricted many of these activities in the past. We have to make sure that these particular forms of legislation are mutually compatible so that everybody is clear where they stand.
Lord Harries of Pentregarth
That highlights the final point I want to make. Before this Bill proceeds any further, would it not be sensible for the Government to get government lawyers and charity lawyers together to see if we can get total agreement about the definition of the key phrase in this Bill?
This highlights the final recommendation of the Joint Committee on Human Rights that there should be a pause in this legislation. The committee says that,
“our primary recommendation is to urge the Government to 'pause' the Bill's passage through Parliament in order to allow for further consultation and scrutiny”.
It would be much better to have a Bill before the House which unites the Joint Committee on Human Rights, the Constitution Committee, the Political and Constitutional Reform Committee, the Electoral Commission and the charities—bodies which at the moment appear to have very severe doubts about it.
Lord Horam (Con)
My Lords, I rise to make my maiden speech in this House. First, I thank the staff of all departments of the House of Lords for their unfailing helpfulness and kindness over the past few days. Secondly, I thank all those Members who have welcomed me here in the Chamber and outside, including the noble Baroness, Lady Hayter of Kentish Town, and the noble and right reverend Lord, Lord Harries of Pentregarth. I was delighted to find from the remarks of the noble Baroness that I was mentioned positively 12 times in her book. I can think of no other book where I am mentioned 12 times positively. I must pop out to buy a copy and thumb quickly through the index—perhaps that was her intention all along. I also thank the noble and right reverend Lord, Lord Harries, for his kind remarks. It is good of him to think that after 31 years in the other place I am still capable of independent thought. That is a wonderful idea and I shall hold it to my breast.
The reason I have elected to make my maiden speech today is that Part 2 of the Bill places many additional tasks on the Electoral Commission, and for 18 months or so I have been one of the 10 electoral commissioners—although I should say immediately that today I am speaking for myself and not for the commission. The commission has sent out a very comprehensive and succinct brief to everybody, which I think noble Lords will possess.
The other commissioner in the Lords is my good friend, the noble Lord, Lord Kennedy of Southwark. There are four commissioners nominated by the political parties, as he and I are, and six without any background in politics. Obviously we are there for our splendid independence of judgment, as has just been mentioned by the noble and right reverend Lord, Lord Harries, but also because we probably know a few of the dodgy things that go on in politics. Of course, he and I are both saints in that respect, but no doubt we are aware of some things that are done by other parties in general elections and are there for that reason as well.
As I have discovered in my 18 months on the Electoral Commission, it is a well run organisation, with a dedicated staff, and I know that the Government will pay attention to what it is saying during the course of this Bill and the discussions around it. The Electoral Commission regulates all elections and referenda held in the UK. That covers the whole business of monitoring what parties do with funds: how they raise them and how they spend them within the compass of electoral law. It does not have anything to do with parliamentary boundaries or local authority boundaries, which many people think it does. It does not have anything to do with those issues and I think that it is rather glad about that. However, the UK is fortunate to have two such organisations as the Electoral Commission and the group of Boundary Commissions to monitor and regulate matters in this area.
If one looks across the Atlantic to where they have no such organisations, one sees absolute gerrymandering of seats, which produces the sort of extreme politicians who have led to such difficulties in Washington over the past few weeks, and the super-PACs, which distort politics in the USA. It is this final point which is addressed in Part 2 of the Bill. I agree with the noble and right reverend Lord, Lord Harries, that the UK is nothing like the United States. Obviously, that is so; the political climate is wholly different. But the fact is that spending in elections by third parties, whether they are single-issue campaigners, trade unions or voluntary organisations, has become an issue. Therefore, just as political parties are limited in what they can spend and how they can spend it, so should these other organisations be. This is the principle behind this Bill.
Nevertheless, as has been said on many occasions in this debate already, there is a balance to be struck. It is important not to damage civil society or freedom of speech. In my view, the original Bill cast its net too wide as regards Part 2. My noble friend Lord Lang of Monkton said it cast its net too narrowly in relation to Part 1, and the noble and right reverend Lord, Lord Harries, put forward an effective analogy about the trawler, which was rather interesting. Clearly we are swimming in rather deep waters here, and the Government are as well. None the less, the net was cast too wide in relation to Part 2. Sensibly, therefore, the Government have already recognised this and made some amendments in the other place. The definition of controlled expenditure, which was a matter of contention, is now back to what it was in the Political Parties, Elections and Referendums Act 2000, which has worked well in two general elections, as the noble Baroness, Lady Hayter, mentioned.
I remain concerned about Clause 27 and the lowering of the threshold for registration. This seems unnecessary. The big spenders—the Bill is about them—already register and are caught by the reduced cap and the wider scope of what is to be controlled, but why go so far down the route to seek to register groups that are spending £5,000 in England and £2,000 in Scotland, Wales and Northern Ireland? You do not get a lot of campaigning for £2,000 these days. These are the “little platoons” that Edmund Burke talked so evocatively about, and they must be treasured. It is in everybody’s interest that my noble friend the Minister looks at this again. If the Government went back some way, at least, towards the Act of 2000 in this respect, as they have with the definition, they would attract a great deal more support than they have at the moment. It would be a wise move. It would not detract from the central purpose of the Bill and would reassure many people who currently are unnecessarily worried.
I hope that the Bill becomes law, because it will improve our electoral arrangements—and they need improving. Only in the past 18 months, we have legislated for the first time in this country to have individual electoral registration, as opposed to household registration. We will remain way behind most other western countries in that respect until that comes into place—hopefully, if the work can be completed in time, for the next general election.
The noble Lord, Lord Tyler, has put out some interesting proposals in an all-party draft Bill on party funding—which, I remind the House, is an unresolved and difficult issue. Again, if I may skirt around an area of controversy without actually entering it, I hope that before too long I will see the day when every vote cast in a general election is of equal value.
That is what I wanted to say on this occasion. I look forward to contributing to other debates on these matters.
Lord Wigley (PC)
My Lords, it falls to me to congratulate the noble Lord, Lord Horam, on an excellent and thoughtful maiden speech. We were, of course, fellow Members of another place—at least, intermittently so—between 1974 and 2001, during which period he had the highly unusual record of serving as both a Labour transport Minister and a Conservative health Minister. I respected him as someone who followed his personal convictions and was brave enough to do so when that meant reconsidering his party affiliation. He brings a breadth of knowledge with him to the Chamber and has done so today. He will undoubtedly contribute considerably to our debates in future. If he were ever again, in the fullness of time, to feel restless, there is always a warm welcome on the Cross Benches.
Turning to the Bill, I declare an interest as a patron or vice president of a number of organisations involved in campaigning on disability issues, including Mencap Cymru and Autism Cymru, details of which are in the register of members’ interests. I have grave misgivings about several facets of the proposed legislation, which seems to be a jumbled assortment of half-cocked ideas being rushed through Parliament without adequate consultation with those bodies which will be affected by it, particularly in the voluntary sector. It also seems to have a party-political agenda in the way that it aims to impose rules on trade unions in a manner which is perhaps geared to creating some mischief.
I first focus my remarks on the lobbying aspect of the Bill. Let me make two things clear. First, lobbying undertaken in an open, transparent and responsible manner is an essential ingredient of the democratic process. Secondly, it can be of great assistance to those in Parliament who have to address issues about which they may not have detailed personal knowledge or experience. Any restrictions placed on the ability of those affected by government decisions to present their case to decision-makers in the most effective manner is, I believe, an infringement of liberties. In the same way as those wishing to access justice through the courts need the help of professional lawyers, so those wanting to convey to Parliament and the Executive their opinions about proposed government action may need the help of professional consultants who know, from experience, the best way to get a message across to those in power.
I was a Back-Bencher for 27 years, and I know how valuable it was for me to have information presented coherently and concisely from both sides of an argument. It helped me to make an informed judgment on those many matters about which, inevitably, I did not have detailed personal knowledge. For example, when I was serving on a Standing Committee scrutinising European Commission proposals which impacted on economic, environmental and social dimensions in these islands, I could not have done my work without the help of such a consultancy, about whose assistance I obviously had to make a declaration, but that would not be permissible under today’s rules. Without that help, I could not have continued as a member of that committee, as the volume of paperwork that had to be scrutinised each week was enormous. I benefited from its research support, but I always made my own judgments, sometimes contrary to its perspective.
MPs are generalists. If they have specialist knowledge, it will be in only a small area of the wide range of policy on which they have to express an opinion. Responsible lobbying is an essential ingredient to make the legislative system work. However, it has to be responsible, and while the majority of lobbying consultancies no doubt undertake their work in a scrupulous manner, there is clearly scope for abuse. That is why we need a legislative framework within which they can operate, a framework which is open and fair to those wishing to influence decisions, one which applies to all lobbying organisations, one which is fair to the Executive and legislators who have to take decisions, fair to those who work in the lobbying industry and fair also to the general public, including those interests which may not command the resources to access professional lobbying but whose viewpoint may be equally valid. It is against the background of those considerations that I shall approach the details of the Bill at a later stage. However, I make it absolutely clear that I support a rigorous, transparent system of registration, provided that it is equitable and comprehensive. I believe that this is in the interests of lobbyists themselves as well as of the democratic process.
At this point I want to flag up two or three matters which cause me concern. First, there is a differential in this Bill with regard to the constraints placed upon Ministers and Permanent Secretaries on the one hand, and on MPs on the other. What is the position of a Minister who is approached in the context of his or her responsibility as a constituency MP? Again, do these constraints apply equally to Ministers and senior civil servants in the devolved Administrations? I support the point that the Bill should be wider in its application with regard to civil servants and, most certainly, policy advisors—the infamous spads.
Secondly, my main misgiving relates to the way in which voluntary organisations may seek to influence decisions so as to safeguard those on behalf of whom they campaign. To my mind it is unacceptable to regard these bodies as acting in a party-political manner and to constrain their freedom when they put forward a strong opinion on a matter which is in the political limelight, particularly at election time when policies are rightly under scrutiny. The testimony which many of us have received from the Royal College of Nursing is a case in point. I served for three years on its parliamentary panel, which was scrupulously balanced: two Conservatives, two Labour, one Liberal Democrat and one “odds and sods”, which included me. The RCN had a strong opinion, on behalf of its members, on government policy which impacted on the delivery of healthcare and associated services. It is not affiliated to the TUC, nor does it take any part in party-political arguments from a political viewpoint. It says in a briefing document which I imagine has been provided to most of us in this Chamber:
“We are deeply concerned by the provisions in Part 2 of the Bill, which will restrict the activities of organisations that seek to legitimately comment on and influence public policy in the run-up to a general election … As currently drafted, the provisions in the Bill may prevent us from raising important issues on behalf of our members if we reach the spending limit during the regulated period … The legislation would significantly restrict on the freedom of speech of organisations that have an essential and a legitimate role to play in a free democracy”.
Those are telling words that we should most certainly be taking on board.
The NCVO has stated,
“the Bill is incredibly complex and unclear. It may be difficult for charities and other voluntary groups to understand if any of their activities would be caught, and this runs the risk of discouraging campaigning activity”.
I urge the Government to suspend progress on this Bill after its Second Reading in order for there to be serious discussion on the advisability of progressing with Part 2 as it currently stands.
There are also sins of omission in the Bill. I see nothing here that will prevent political parties rewarding generous supporters with honours or even—it is alleged—appointment to this Chamber. When the two parties in government bring forward legislation to hamper voluntary organisations in the manner I have described, I believe it is quite cynical that there should be no tightening on those abuses within the political system. Parties plead that they cannot otherwise raise money to fight election campaigns, but there is a simple answer to that, which is to restrict the amount parties can spend on general campaigning in the same way as there are tight restrictions on spending on constituency levels, but that is not adequately covered in legislation.
Some would even advocate state funding of political parties as the answer to their cash-flow problems. To my mind, that would be an absolute outrage. At a time when vital services to vulnerable people are being cut because of the financial squeeze, it would be quite wrong to divert taxpayers’ money to prop up parties which cannot generate enough enthusiasm among their own supporters to fund their campaigns. Equally, there is a valid case to be argued that we must avoid having individuals and organisations buying influence from hard-up parties by contributing huge sums towards their campaigning costs. That is the balance that has to be struck and to which we shall undoubtedly return at later stages.
There are also questions relating to the way that this legislation impacts on the political process in the devolved legislatures of Wales, Scotland and Northern Ireland and the degree to which there has been political consensus with political parties and campaigning organisations in those territories in regard to the Bill. Is it the Government's intention to invite the National Assembly for Wales to introduce its own legislation in this field and, if so, will the Government ensure that the National Assembly benefits from a transfer of powers order to give it the necessary legislative power to deal with those matters? I hope that this House will improve the Bill significantly during its passage and that the Government will listen, particularly with regard to Part 2.
Baroness Jay of Paddington (Lab)
My Lords, I echo the noble Lord, Lord Wigley, in welcoming the noble Lord, Lord Horam, and congratulating him on his maiden speech. I rise to report briefly on the scrutiny of the Bill undertaken by your Lordships’ Select Committee on the Constitution, which I have the privilege of chairing. The House has already heard some powerful points from one member of the committee, the noble Lord, Lord Lang of Monkton, and a further speech will be made by the noble Lord, Lord Hart of Chilton. I hope that between us we will cover the major points that the committee has given in its report.
We reported on this Bill last Friday, 18 October, having discussed it at our meeting on 16 October. Somewhat unusually, we decided to publish our report rapidly and before Second Reading, rather than wait as we sometimes do to propose specific areas for amendment at the next stage. The committee felt that in this case the House should be made aware immediately of our significant concerns about the content and overall handling of the Bill.
The Constitution Committee accepts the view, widely promoted this afternoon, that there is general cross-party support for achieving greater transparency—a greater showing of the light, as it has been called—on lobbying, a matter that has been discussed for many years. We also welcome the amendments that have been made in another place to establish a clearer view of the position of Members of both Houses.
Overall, however, we are unsure that the Bill will achieve proper improvement in the immediate concerns of the general policy. We have specific doubts both about the clarity of the Bill’s provisions and about the potential effects of aspects of the Bill. Some of these might have been addressed if, as has been repeatedly said this afternoon, the Bill had not been introduced in what we describe in the report as “undue haste”. That obviously led to difficulties of scrutiny, with no pre-legislative scrutiny and an inadequate concern for time in the other place.
As your Lordships will be aware, over a number of years the Constitution Committee has published a series of reports—under different Governments, I point out—stressing the importance of effective scrutiny in legislation not only to enhance the reputation of Parliament but to improve the quality of legislation. Perhaps I might take two minutes to quote, as we do in our current report, from those previous reports. For example, in Parliament and the Legislative Process, we noted that,
“subjecting … measures to rigorous scrutiny is an essential responsibility of both Houses of Parliament if bad law is to be avoided … Parliament has a vital role in assuring itself that a bill is, in principle, desirable and that its provisions are fit for purpose”.
In another report, from the Session of 2010-12, The Process of Constitutional Change, we reiterated that,
“if Parliament cannot be seen to be scrutinising proposals with the thoroughness they deserve, public confidence in parliamentarians is likely to be further undermined”.
The committee feels that this is particularly important when dealing with matters that affect the constitution. We have emphasised that point in a succession of reports, which I have quoted from very briefly.
Here we come to the nub of the problem with the current Bill that the Constitution Committee is most concerned about. A Bill that directly affects the electorate’s ability to engage with the Government and to take part in political campaigning must challenge the fundamental common-law right to freedom of political expression. There could not be a clearer constitutional principle and, as the committee report states, given these factors it is essential that the process accords with the highest standards. However, the committee concludes that, given the lack of external consultation, the absence of a White Paper or a draft Bill and the hasty proceedings in another place, the handling of the Bill to date is a matter of significant concern.
To move to our scrutiny of the policy substance of the Bill, in Part 1 we share the generally expressed concern about the narrow scope of provisions on the work of lobbyists. Again, I quote from our report, which in turn mentions the report by our fellow committee in the other place:
“The Government’s lack of engagement with the industry is reflected in a poorly drafted and narrow definition which does not accurately reflect the work undertaken by lobbyists”.
As with many speakers this afternoon, though, it is of course Part 2 that has most concerned the committee as far as the policy is concerned. I remind your Lordships that the proposed amendments to the Political Parties, Elections and Referendums Act that tighten and extend various controls, including financial controls, are in Part 2. We have heard a series of vivid examples and explanations from various speakers today about the impact of these controls and extended financial regulations on the charity sector and on the voluntary sector in general. The potential limits on their campaigning activities have been described as “chilling” and as a chilling threat to their constitutional rights. Your Lordships’ Constitution Committee notes that the House must ensure that the Bill gives absolute and appropriate justification for interfering with that right. In the committee’s view, the Government had yet to offer such a convincing justification for extending the control on third parties and I suggest to the Minister—although obviously this is a personal view, as the committee has not met to consider today’s speeches—that that justification still has yet to be heard.
We conclude that your Lordships will wish to consider whether extended control is really necessary, given the particularly serious implications for a basic constitutional right. This is the question of achieving the balance that several noble Lords have referred to today. In consideration of the Bill, as the House has heard, the House has the advantage of several relevant parliamentary reports, including the very trenchant findings of the Political and Constitutional Reform Committee in the Commons, the report of the Joint Human Rights Committee, which my noble friend Lady Kennedy of The Shaws has referred to, and that of the Commons Committee on Standards. All these reports share a similar disquiet about the way in which the Bill has been handled and serious concerns about its content. I hope that the combined authority of those committee reports, together with your Lordships’ own Constitution Committee report, will give the Government pause and encourage Ministers to listen very carefully to the debates in this House.
The Earl of Clancarty (CB)
My Lords, I, too, congratulate the noble Lord, Lord Horam, on his maiden speech, which was an extremely useful contribution to this debate.
My comments will be directed mainly at Part 2. This Bill has been driven by two engines, self-absorption and self-regard—self-absorption because it wilfully misunderstands and ignores both the way in which campaigning works and its meaning to society, and self-regard because it assumes that government and party politicians are more important than public discussion. I fear that the Bill will put Westminster further into a bubble.
There is a huge difference in kind between lobbying carried out on behalf of commercial industry, which ought properly to be the subject of Part 1, and campaigning on issues of public concern without thought of financial gain, which becomes a target in Part 2. The Government need to recognise that the spectrum of charities, pressure groups, demonstrators and the like together represents one of the significant voices by which the public are heard. To curtail these activities, as many campaigning groups fear will happen, will curtail the people’s voice, as the right reverend Prelate the Bishop of Derby has already suggested.
Politics does not stop at Westminster Bridge, yet with the Bill the Government are acting as though that were the case. Governments always say that ordinary people should be more involved in politics, but they already are—just not necessarily in party politics. As Justine Roberts of Mumsnet said, commenting at the launch of the Commission on Civil Society and Democratic Engagement, chaired by the noble and right reverend Lord, Lord Harries,
“ordinary people speaking up and getting involved in the political process makes for a healthier democracy”.
The Government need to recognise that most charities and campaigners are political—sometimes with a small “p”, but often with a large “P”, because party politics can be the means by which issues raised by charities are dealt with and sometimes resolved, which is what makes the critical wording,
“reasonably be regarded as intended to promote or procure electoral success”,
of parties or candidates so problematic for every charity.
It is a natural part of the process that all campaigning groups will wish to find supporters in Parliament who will promote their cause. However, the big difference between parties and their associated organisations on the one hand, and charities and campaigning organisations on the other, is that campaigning organisations follow the issues and support for the issues that they would wish to raise in Parliament, not the party. Incidentally, that is why the Cross-Benchers, who are independent of parties, play an important role in bringing so many of such issues to the attention of Parliament.
The ideal, of course, would be that support for a cause has cross-party support, although this is not always possible. The great majority of campaign groups will be rightly resentful of being tethered through registration to a party political post when in reality, in the longer term and in the broader context of a campaign group’s aims, this is invariably not the case. Friends of the Earth put this very well when they say,
“we never support one party or candidate over another, and never tell supporters or the public how we think they should vote. But we do say what we think about important environmental policies that politicians and political parties also have an opinion about”.
One of the problems with Part 2 of the Bill appears to be not just fears about whether you will be caught out by it, but the uncertainties about what it is intended to achieve. Big Brother Watch, English PEN and others have said that for many charities,
“self-censorship is an inevitable consequence of the bill as it stands”.
If the Bill goes through as it is, it will be destructive both for groups and for our democracy. A year is a hugely long time for campaigning organisations to be effectively out of action, when in the lead-up to an election precisely the opposite ought to be the case.
What about the role of the press during this period? Presumably it will then have a free hand in this regard, although to be consistent the Government ought to restrict the press as campaigning organisations as well. I am not in favour of that. In the lead-up to an election there should be a properly healthy public discussion of issues and policies, including the views of both a diverse press—ideally—and campaigning bodies, running alongside each other.
Campaigns develop and grow organically, often starting from small groups. For some organisations, artificially to stop campaigning for a year would be a body blow, because campaigns are built on momentum. Other campaigns are time-sensitive, and one can all too easily see the Government of the day pushing through contentious decisions during this period—for example, beginning construction work on a nuclear reactor—under the radar, as it were, without public discussion or protest.
There is a part of me which says, perhaps against my better instincts, “Bring on this silence for a year”—which is what will happen if the Bill passes as is. Perhaps we would see the emergence of quieter voices, more non-professionalised campaign groups staffed by volunteers operating at low cost—except that volunteers are to be counted towards costs, and it will be very difficult for any organisation to operate within the extremely low thresholds that the Bill sets. What we would more likely see is more direct action and more and more outrageous ways in which some groups will draw attention to themselves.
I cannot help but think of the group Femen, which we learnt last week is setting up a London branch. Without suggesting in any way that that or any other group has any intention of breaking the law, I suspect that such a group would never contemplate registering with the Electoral Commission. It would argue that to do so would be to defer to a patriarchal and authoritarian system. Many might think that it would have a point. The key point here is that no Government should try to put a lid on the public voice, which the charities and campaigning groups represent. Indeed, it is, in the long run, unrealistic to do so because you cannot put a lid on boiling water without the steam somehow, in the end, finding a way of escaping.
Many of the great social reforms of the past have come about thanks to the tireless work of people outside the mainstream, who felt that this was how they could best serve their country. Politics at Westminster is not a one-way street and campaigning organisations are an important part of the process. Indeed, their role within the political process is often underestimated by Governments and sometimes wholly ignored—I can think of one recent example during the passage of a Bill.
My strong preference would be to see this Bill paused. Part 2 should certainly be rejected because it is unnecessary and fundamentally misconceived. Any reform that the Government wish to undertake should be far more considered and consulted on.
Baroness Pitkeathley (Lab)
My Lords, I begin by congratulating the noble Lord, Lord Horam, on his maiden speech, and by drawing your Lordships’ attention to my interests in the register, especially to my roles as vice-president of Carers UK and as chair of the All-Party Parliamentary Group for Civil Society and Volunteering. I hope that I might be permitted to record my disappointment that neither of the Ministers on the Bill is currently in the Chamber.
I will concentrate on Part 2 of the Bill, and I will speak personally. As far as I am aware, none of us knows how we become a Member of your Lordships’ House—the reasons we are chosen and so on. However, I have a pretty good idea why the honour was conferred on me. It was because I was a campaigner and lobbyist—rather a successful one, I would suggest. I was chief executive of a charity whose raison d’être was lobbying and campaigning in pursuit of policy changes for carers.
Let me take noble Lords back to the mid-1980s. The word “carer” was unknown; it was frequently misspelt as “career”. Nothing of what we now take for granted about the issue was known. We had no numbers. Estimates were not believed. We had no idea about the range of activities that carers undertake, or the distress that caring can cause. There were few organisations that dealt with caring, no helplines and no legislation. No attention was paid to carers at all. It is hard to believe now, when the word “carer” is added to practically every document coming out of every government department—and sometimes, I think, every sentence of every document coming out of every government department. Think of the Care Bill and the focus on carers’ rights. Think of what we now know about carers for o1der people, young carers, parent carers, carers in the benefits system, carers in employment and so on. It is hard to imagine what it was like 20 or 30 years ago.
All that we have achieved for carers has been achieved by lobbying and campaigning by a registered charity, or by several charities working together. No Minister or department suddenly woke up and said, “Oh, sorry. This is a group of people whom we have been ignoring for years. We had better do something about it”. Of course they did not. They took notice because we drew attention relentlessly to what the situation was by focused campaigns, getting the media on side and getting carers to be willing to speak out rather than being a silent and hidden army. Figures on how many carers there are and how much money their contribution is worth did not come out of the blue. In fact, I remember successive Secretaries of State denying that the numbers of carers that I was suggesting even existed. We got the numbers because we ran a concerted campaign to have a question about carers included in the census, and then we used the figures, which surprised everybody—6 million, since you ask—at every opportunity.
Our campaigns for policy change were never more concerted and active than during election periods. I first attended party conferences in the late 1980s—all the party conferences, of course—and at the 1992, 1997, 2001 and all elections since, a carers manifesto has been produced and all political parties have been lobbied to make concessions for carers. A very important aspect of this work was the alliance that was formed to give the lobby the strongest possible voice. Originally, more than 20 carer, disability, older people and patient organisations came together to produce a manifesto. This made the call and the demands of the manifesto so much more powerful. Many of us have recently been in contact with the Care and Support Alliance, which played such an important role in both last year’s Health and Social Care Bill and the Care Bill currently being considered by this House. If each of those many organisations had had its costs counted, including its overall admin costs, I doubt whether they would have come together in such an effective way. Indeed, I am sure that they would not. The effectiveness of such coalitions has already been mentioned by several noble Lords.
What would have been the situation of carers if all these campaigns had not taken place? Eventually, what was a private trouble might have become a public policy issue—the one that we know so well today—but not as quickly or effectively, I would contend. Three Private Members’ Bills, a national carers strategy, the Standing Commission on Carers, and the Law Commission report that led to the Care Bill all came about as a direct result of regular lobbying and campaigning, much of it focused in election periods. I might add that the tradition in the United Kingdom of campaigning charities effectively lobbying for changes in policy is the envy of the world—and I do not exaggerate that, as I know it from my contact with emerging carers movements in many other countries throughout the world.
Of course, we have to emphasise that this is politically neutral campaigning, which requires a degree of political sophistication to bring about. Is it that political sophistication and political nous that frightens the Government and makes them put in place this sledgehammer of a Bill to crack what is, at worst, a very small political nut as regards charities. The Bill surrounds charities with an unwarranted amount of bureaucracy, as noble Lords have pointed out, while at the same time not being nearly strong enough with the real culprits, who should be addressed in Part 1 of the Bill.
I use the issue of carers as an example of what will be lost if the Bill goes through in its current form, because it is the one I know best. But there are dozens of others, as is apparent from the huge amount of correspondence that your Lordships have received on the Bill—from climate change to child abuse, through every variety of charity. That would not have come to public attention if it had not been for the efforts of charities, acting singly or in alliances. I am baffled as to how any Government who have sung the praises of the big society and repeatedly placed emphasis on the importance of the charitable sector can put before us a Bill so ill thought-out and with so much potential to stifle the voices of the disadvantaged, and ignore groups and issues that are the very essence of democracy.
If you really want to engage with charities and the voluntary sector, as this Government constantly assure us that they do, you cannot simply put them into the role of service providers, effectively gagging them because they are too dependent on contracts to utter a breath of criticism. What has happened to the Minister’s call, made so trenchantly before the election, that the charities should,
“keep our feet to the fire”?
I quote him directly. Is that to be interpreted as keeping their feet to the fire except in an election year—and only if you keep the costs down to the level that they have set?
Will the Minister take this opportunity to answer the many questions that are being asked? For example, what exactly constitutes campaigning? Does it include taking part in policy discussions or doing research on issues such as poverty, and publishing the results? How are partnerships and alliances to be defined, and their expenditure costed, without huge administrative burdens on already cash-strapped organisations? What is the Government’s reaction to the legal opinion that says that the Bill will restrict organisations’ ability to engage in campaigns or policy debates and will insulate the Executive from criticism? Above all, why the rush? There are so many problems with the Bill, and so many possibilities of unintended consequences—I give the Minister the benefit of the doubt and do not accuse him or the Government of sinister motives, though many might—that surely the right thing to do is to start again, or at least to pause and put the Bill through the sort of scrutiny that a pre-legislative process would have provided. Starting again would be a sign not of weakness but of a Government who have the courage to seek and take notice of the opinions of the society that they represent.
Lord Norton of Louth (Con)
My Lords, I start with two general observations about the Bill. The first concerns process and the second concerns construction.
The Bill is the product of the “something must be done” response to a particular problem. There is a problem, not least in terms of public perception of illicit or unethical lobbying of policy-makers, but that problem requires a considered response, one that both addresses the problem and is seen to do so. This Bill, as I shall argue, fails on both grounds. My principal point here, following other noble Lords, is that the measure has been rushed. I share the concerns expressed by the Constitution Committee of your Lordships’ House in its report on the Bill. As it noted, the Government had announced that there would be a White Paper and a draft Bill. There has been neither. As has been said, this places a particular responsibility on your Lordships’ House in scrutinising the measure.
In terms of construction, this is a Christmas tree Bill. The previous Labour Government brought in Bills that were essentially two Bills in one and sometimes three Bills in one. This Government have continued the practice. The title of the Bill is something of a giveaway. The relationship between the three parts is tenuous, to say the least. This practice places particular strains on the other place in terms of detailed examination in Committee. This House can adapt its examination to the discrete parts of the Bill somewhat more effectively, but it is none the less a practice to be deprecated.
I turn to the substance of the Bill. Like my noble friend Lord Lang, I shall focus on Part 1. Much that I say will reinforce the points that he made. As the noble Baroness, Lady Jay, said, there is general acceptance that there should be more transparency in lobbying. This Bill, though, is too narrowly drawn to correct the mischief that has motivated its introduction. The Bill is concerned to identify those who engage in lobbying on a commercial basis, and do so as free-standing entities. I am not sure what that adds to our knowledge. The more one reads the exclusions in the Bill, the more one recognises the limitations of the exercise. It excludes small-scale commercial lobbyists, those for whom lobbying is not the principal purpose of their business and in-house lobbyists. Some companies have sizable lobbying teams. One suspects that their activities may at times be as much a concern to the public as are the activities of dedicated lobbying firms. Will the Minister tell us why the Government differentiate between lobbying of Ministers on, say, the duty on cigarettes by in-house lobbyists of tobacco companies and lobbying by commercial lobbyists bought in by tobacco companies for the purpose of lobbying Ministers? From the perspective of the exercise of lobbying, and how it is perceived by the public, what is the salient distinction?
That brings me to another crucial limitation of the Bill. The focus is one of status and, as I have explained, a rather narrow one. It is not directed at the actual activity, other than indirectly. It seeks to influence behaviour through making public who engages in commercial lobbying. There is no statutory code of conduct and no stipulation of principles that should govern the behaviour. In so far as the Bill influences behaviour, it may be to encourage lobbyists to avoid making representations in a way that brings them within the scope of the Bill but, as most are not presently caught within the ambit of the Bill, it will not make that much difference anyway. All that the Bill does is to introduce a new layer of regulation for no obvious public benefit. It tells us, at some cost, what is largely already known.
The Bill, in short, is fundamentally flawed. The point has been well made in the other place by Members on both sides that it is based on a lack of understanding of how lobbying actually works. It was expressed especially well by a former student of mine, Tracey Crouch, who spent several years as a lobbyist. As she pointed out, the lobbying industry today provides a very different service and is a very different industry from what it was 10 or 15 years ago. Consultant lobbyists are more likely to advise clients on how to undertake lobbying of government rather than undertake it themselves, and if they do undertake it, they are not likely to be lobbying Permanent Secretaries. The Government appear not to understand the industry as it now is, most of which will not be caught by the provisions of the Bill.
The Bill is neither one thing nor the other. Either it should go the whole way and introduce a comprehensive register of lobbyists or it should be abandoned and the Government should instead address the problem from a very different, and I believe more effective, perspective. The case for a comprehensive register has been made by others. I am not persuaded of the need for a register, comprehensive or otherwise; it may prove counterproductive with lobbyists using registration as a seal of approval. More importantly, I do not believe that it would assuage public concerns about the lobbying of government.
The other approach, which I commend to the House, is to shift the emphasis entirely and build on existing practice. In opening the debate, my noble friend Lord Younger made the point that there is now more transparency about policy-making meetings, with a quarterly publication on those meetings. My noble friend Lord Lang also referred to that. Why not build on that? When Select Committees produce reports, they publish the names of those who have given evidence, that is, who made representations to them. It is normal practice to publish the material submitted to them. Why not require Ministers, when making policy announcements or publishing Bills or draft Bills, to list the names of all those who have made representations to the department on the issue? Listing all those who have lobbied on the subject would be transparent and comprehensive. It would not matter whether it was an in-house lobbyist, a paid or unpaid lobbyist, or simply individuals writing in. It avoids the need to define lobbying, and we would know who had made representations.
There may be a case, building on existing practice, for publishing the notes of meetings and written representations, similar to the evidence volumes published by Select Committees. If this was routine practice, drawing material together on a particular measure, it would properly address the problem. There may also be a case for extending it to non-decision-making: that is, when a Minister decides not to pursue a particular policy under consideration. I appreciate that there may be, indeed no doubt are, flaws in this alternative proposal, but I have yet to find any that render it a less desirable approach than that embodied in the Bill. Perhaps the Minister can explain why my proposal is not to be preferred over that advanced by the Government. If he cannot, the Government may wish to reflect on the wisdom of continuing with a flawed Bill.
Lord Hart of Chilton (Lab)
My Lords, there will be many echoes and repetitions this afternoon and evening, and I make no excuse for joining in because the issues are so important. As has been mentioned, I am a member of your Lordships’ Select Committee on the Constitution, whose report was published last Friday. On the same day, the Joint Committee on Human Rights published its report and prior to that on 5 September the House of Commons Political and Constitutional Reform Committee published its report. All are cross-party committees and all are agreed on their conclusions and recommendations. All are highly critical of the Bill.
Three common issues emerge. First, once again, the Government have introduced a Bill without adequate consultation and scrutiny, not least without pre-legislative scrutiny. As my noble friend Lady Jay of Paddington pointed out, the Constitution Committee has repeatedly stressed the importance of proper scrutiny and consultation. That is important for the reputation of Parliament and the quality of legislation itself. Any failure to do so undermines public confidence, particularly in the case of Bills of constitutional importance. This is such a Bill because it directly affects the ability of people and organisations who wish to engage with the Government and participate in political and electoral campaigning to do so. Freedom of expression and freedom of assembly are rights which lie at the very heart of our constitution. Any threat to these would not only infringe Articles 10 and 11 of the European Convention on Human Rights but be contrary to fundamental common law. Some say that this Bill does just that, and I have seen a leading counsel’s opinion which states that there are grounds for a legal challenge on grounds of incompatibility.
A second but connected theme emerging from the reports is that throughout the Bill there are problems of definition, both individually and collectively, which have caused great uncertainty and could lead to unforetold consequences. For example, broadening the scope of controlled expenditure and at the same time lowering its cap, the definition of consultant lobbying and the scope of the Bill have all raised fears and concerns which the lack of proper scrutiny and the speed with which this legislation is being catapulted forward have made worse.
A third theme, which has already been mentioned, is whether, in the absence of a clear rationale, Part 2 is necessary at all, and that what is being proposed is quite disproportionate. The Joint Committee on Human Rights states at paragraph 60 of its report, to which the noble Baroness, Lady Kennedy of The Shaws, drew attention:
“We are concerned that the lack of understanding and clarity about the practical effects of the Bill has led to widespread concern that third parties may be dissuaded from participating in campaigns with a potential ‘chilling effect’ on free speech and freedom of association of third party campaigners”.
Judging by the letters and e-mails that I have received, I believe that it is quite right. For example, legal aid, access to justice, human rights and examples of unjust law are all likely to be election issues. Under current definitions, a third-party campaigner on any of these issues is exposed to the risk that his or her campaigning activities could be regarded as intended to promote or procure electoral success for a party or candidate even though it is accepted that he or she had no such subjective intention to do so or that he or she did not name any party or candidate or that he or she was engaging in the campaign for its own sake. Such a result cannot be intended, but that is an example of the uncertainty which has been caused.
The Constitution Committee also drew attention to Clause 35 extending the regulatory duties of the Electoral Commission, which has expressed concerns about the rationale for it and whether it has the resources to fulfil the extended obligations effectively.
As to my personal view, I regret to say that I believe this Bill, and the way it has been processed, is a rather shoddy piece of work which has caused in its slipstream much concern and uncertainty. The noble Lord, Lord Tyler, seems to think that it is a giant torch shining light on dark cupboards. To me it brings dark clouds and obscurity. I believe that it requires far more scrutiny than the speed of its planned parliamentary timetable will permit. Accordingly, I agree with the Joint Committee when it suggests that the Bill should be paused and submitted for more extensive scrutiny and greater consultation. Alternatively, of course, Part 2 could be dropped altogether. There is a need for a Bill, but this is not it.
Lord Aberdare (CB)
My Lords, I will try to outline my thoughts on the Bill without going into too much detail since most of the points I wish to make have been made already and may well be made again. I will address Parts 1 and 2. I have no problem with the principles of the Bill. I believe that a register of lobbyists is important to ensure the openness and transparency of lobbying activity, and I also support the aim of Part 2 to take the big money out of politics, as we have heard it described. However, I have two broad concerns about the Bill as drafted. Does it risk going too far and actually taking the politics out of politics and will it achieve its laudable aims in a workable, effective and not too burdensome manner?
On Part 1, I start from the principle that lobbying is a vital part of our democratic system. I worked in IBM’s government relations departments in both the UK and the USA and was then a partner in a public affairs consultancy, so at times I engaged in lobbying myself. However, I, and perhaps other noble Lords, might not be able to contribute to debate on this Bill in an informed way if it were not for the lobbying efforts of numerous organisations interested in or concerned by it. It is important that lobbying should be open, transparent and above board. The system to achieve that should be clear, fair, workable, reasonably straightforward and comprehensive, so I have considerable questions about how the proposed register is to be set up.
First, why are only consultant lobbyists covered? What about in-house lobbyists, other corporate advisers such as management consultants, law firms and accountants, trade associations and other such representative bodies? Consultant lobbyists represent a very small proportion of total lobbying, perhaps not much more than 10%. In my experience they generally accompany their clients in lobbying situations, if they take part in them at all, and it is the client who has the most direct interaction with the person being lobbied. It is hard to see how the omission of the bulk of lobbyists and their activities from the register will achieve the aims of increasing transparency and public confidence.
Secondly, why does the Bill extend only to lobbying of Ministers and Permanent Secretaries? A huge amount of lobbying takes place at lower levels, including with special advisers, for example, both before and after any direct contacts with Ministers or Permanent Secretaries. Moreover, as we have heard, Ministers and Permanent Secretaries are already supposed to publish details of their meetings with external organisations. If the public need to know who those organisations represent, why could this information not just be added to those reports? After all, if Ministers or Permanent Secretaries do not know who the lobbyists they meet are representing, the lobbying effort seems unlikely to be effective. In this context, I was quite attracted by the proposal from the noble Lord, Lord Norton of Louth, about turning the whole thing around and looking at it from the point of view of the people being lobbied.
Although I welcome the evident desire of the Government to adopt a minimalist approach, I wonder if there is not a danger of ending up—and here I echo what the noble Baroness, Lady Pitkeathley, said about Part 2—with an overlarge sledgehammer to crack a small, though admittedly irritating, nut. If we are to have a register and a registrar should they not be a little more comprehensive in their coverage without, of course, imposing undue burdens on lobbyists or their employers? Perhaps something can be learnt from existing systems elsewhere. For example, I have heard the European Union system described, with some approval, as a “coerced voluntary register”.
Finally, should there not be some encouragement for lobbyists to sign up, preferably on a voluntary basis, to codes of conduct such as that of the Association of Professional Political Consultants, which has been in existence for some 20 years? Could the system not make some sort of allowance for lobbyists who show that they adhere to a recognised code of conduct, as was suggested by the noble Lord, Lord Tyler?
I find myself in a similar situation with Part 2. The aim may be worthy, but its implementation falls far short of being as clear, workable and proportionate as it should be. I have been very struck by the number of significant and reputable representative organisations expressing concern about this part of the Bill. To pick just a few, there are: the NCVO, with some 10,000 members; its Welsh equivalent, the WCVA, with more than 3,000 members; Bond, which represents 400 international development bodies; 13 faith groups; and the Commission on Civil Society and Democratic Engagement, chaired by the noble and right reverend Lord, Lord Harries, which was formed by some 50 very diverse third-sector organisations specifically in response to concerns about this Bill. Numerous bodies have added their voices to these concerns such as the CBI, Citizens Advice, the Countryside Alliance, the National Trust, the National Federation of Women’s Institutes and the Royal British Legion, to mention just a few. No doubt briefings are still coming in from further organisations as we speak. Then there is the Political and Constitutional Reform Committee in another place, the Joint Committee on Human Rights, your Lordships’ own Constitution Committee and even the Electoral Commission itself. Such a breadth of concern, with little or no countervailing opinion, should surely raise serious pause for thought.
The definition of “controlled expenditure”, even after the amendments made in another place to bring it more in line with the previously existing situation, remains complicated and unclear. One thing that is clear is that Clause 26, combined with Schedule 3, considerably extends the range of expenses covered, for example to include staff costs, if not even volunteer time, although I was reassured by what the noble Lord, Lord Phillips of Sudbury, said on that matter. While the scope of controlled expenditure is widened, the thresholds for registration to be necessary are significantly lowered in the Bill, by half in England, and more than half in Scotland, Wales and Northern Ireland. The limits on the maximum amounts that can be spent are also reduced, again by more than half. I have seen no rationale or justification for these reductions. Several organisations have said that the previous regime under PPERA was tolerable only because the thresholds and spending limits were sufficiently high not to affect the great majority of campaigns.
The reduced thresholds and limits are likely to bear down particularly hard on third-party organisations in Wales, Scotland and Northern Ireland. For example, no allowance is made for the fact that in Wales much of the material now classified as election material has to be produced in two languages, with significant extra costs. Nearly all organisations commenting on the Bill, including the Electoral Commission, believe that the Government’s estimates of the number of bodies likely to be affected are unrealistically low.
The rules on coalition campaigns, where each member of a coalition has to include the full amount of coalition expenditure as part of its own controllable expenses, seem likely to have a strongly discouraging effect on campaigns of this nature, although in most other respects they seem positively desirable, as well as effective. Given that charities are already regulated by the Charity Commission under charity law, which prohibits them campaigning on party-political issues, I can understand why the question of whether they should not be specifically excluded from coverage under this new system has been raised.
I will not go into questions of why the Bill was not subject to greater pre-legislative scrutiny and consultation, as it surely should have been—and indeed should still be—or why there is such an unseemly rush to get Part 2 in place before the next general election, so that all the third-party organisations newly brought within its scope will have to have their future campaigning plans in place as soon as next May, despite all the issues raised in today’s debate.
The Bill in its current form seems likely to represent a significant burden on organisations, many of them small, which could by no stretch of the imagination be regarded as the sort of big money that could realistically distort elections, and to drive a coach and horses through this Government’s claim to be committed to deregulation and the big society. Even worse than that, it could risk causing significant collateral damage to the workings of our civil society as a whole. I hope the Bill will emerge from your Lordships’ House with significant improvements so that it fulfils its worthwhile aims without such undesirable side effects.
Lord Rooker (Lab Ind)
My Lords, the note handed out by the Minister on 10 October stated:
“The Bill takes forward the Coalition Government’s agreement to enhance transparency around the interaction of certain ‘third parties’ with our political system”.
I did a search of the coalition agreement and no such thing is in there. The best I could find was in Chapter 16, “Government Transparency”, which states:
“We will regulate lobbying through introducing a statutory register of lobbyists and ensuring greater transparency”.
Elsewhere in the coalition agreement, I found lots about social action and,
“the creation and expansion of mutuals, co-operatives, charities and social enterprises”,
and about encouraging involvement in social action. The coalition agreement also boldly claimed that,
“our political system is broken”.
In fixing the broken system, the coalition now seeks to fix the system in a way that Putin in Russia would be proud of, by fixing the date of the general election and then snuffing out civil society in the year before it. That is the reality. It is quite clever: make the law imprecise so that civil society has no certainty, and give the policing of the law to a commission, which said of the Bill when it was first published in the Commons:
“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”.
The replacement wording now needs very rigorous testing in your Lordships’ House because new activities are covered for the first time.
As part of the government “fix” of civil society, the Bill introduces a major change in the Electoral Commission’s regulatory remit. This was not forewarned to the commission. No consultation took place with the board or the accounting officer and no rationale has been given. The House will need to test this when we debate Clause 35.
I say to the House that the same group of Ministers in charge of this Bill in the other place changed part of the remit of another regulator, the Food Standards Agency, in 2010—overnight and without warning—as regards food adulteration. Since then, we have had the horsemeat adulteration scandal, and in recent weeks the 2010 changes have been condemned by both the National Audit Office and the Defra Select Committee. We have been warned.
Of course, this worried Government believe that the Bill will not curtail freedom of expression by campaign organisations. That was in the note from the Minister, but those affected by the Bill must have another version of it. The Bill was not just rammed through the supine House of Commons by the coalition Government; it was printed and published the day before the Summer Recess. There was no consultation prior to publication and it was slipped into Commons Committee in the black hole of the two-week September sitting. The Government exercised bad faith by promising government amendments a week before Report but delivering them only two days beforehand.
The bodies affected by Part 2 of the Bill, which is all I am speaking about, will in the main be registered charities. This means, as has been said, that they are already regulated regarding all activities that they undertake, including during the election period. They claim that the Bill will place extremely tight restraints on their work 12 months before the election. It is also a direct threat to some of the most valued democratic principles, such as freedom of expression, and it undermines democratic participation by restricting civil society involvement in debates. Even now, we do not know whether charity or community volunteers’ time will be costed and included in the new time limits. There is still doubt about that. Assurances given by Ministers in the Commons regarding the ability to support specific policies have not been met.
The Bill rigs the financial limits by effectively counting twice the money spent if organisations are in coalition. This is a massive deterrent to, say, a charity for the homeless working in conjunction with an environmental charity to seek a new housing development—or it might stop two or more charities working together and joining their back-office functions to save money. Furthermore, the Government broke the national compact regarding consultation on matters affecting the third sector, and they cannot deny it. As has been said, the Bill creates a chilling effect on campaigning activity.
The Commons was treated with contempt, says the Political and Constitutional Reform Committee. At paragraph 3 of its report, it says:
“This is an object lesson in how not to produce legislation”.
It is the case that any and every organisation that seeks to influence public opinion, whether through campaigning or advocacy, in the 12 months before a general election, either directly or as a consequence of its actions, is now going to be covered. What a gift to those who conduct sham democracies around the world. Christian Aid cannot run its Make Poverty History campaign again in a general election year; the Royal British Legion’s Time To Do Your Bit campaign in 2010 cannot be repeated; and the Countryside Alliance will likely not be able to function at all in the 12 months before a general election. We are informed by NAVCA, the National Association for Voluntary and Community Action, whose members support 160,000 local charities and community groups, that the campaign it ran, Real Powers for Communities, could also not be run. That campaign, believe it or not, was designed to highlight the support that the coalition Government’s Localism Act could give to charities and groups. Is this all a mistake? Actually, I do not think so.
The Bill makes virtually no change regarding commercial lobbyists but punishes charities and other civil society groups. As has been said, we need to be mindful that those belonging to charities and civil society groups far outnumber those belonging to political parties. I wonder why that is.
For all the rhetoric, many members of the coalition have little or no regard or respect for civil society. The big society is okay when it is running a park or volunteering for the Olympics but not when it wants to speak up. That is the reality. If our political system is broken, this is not the way to mend it.
I suspect, and certainly hope, that this unelected House has more concern about freedom, plurality, good governance and, indeed, the rule of law than the Commons at the present time. Given the lack of pre-legislative scrutiny, the inadequate scrutiny that the Commons gave and the concerns of the regulator, if this House does not now do a decent job, we might as well ask Clegg to come back and abolish us, as he was planning to do in the first place.
It appears that the new constituency controls may be completely unenforceable, as we have heard, because of the combination of the lower registration threshold and spending limits, new constituency limits and the wider scope of regulated activity. Far more allegations of breaches of the rules will come forward in the heat of an election, as has happened in the past, yet the Government have still to explain how they think the Electoral Commission will enforce these new constituency controls. That was not even debated in the Commons.
I realise, of course—and I am not trying to win friends and influence people in the coalition at the moment—that the coalition has rigged this place to create a government majority for the first time, but it is not too late to make this a better Bill. We have not yet been given a list of issues from the previous general election, where there was concern regarding civil society, to justify this draconian measure. In fact, 33 non-campaign groups registered at the previous election. In total, they spent £3 million in the year before the election. The three main political parties spent £31 million in that year. Where is the problem? I repeat: £3 million was spent in the year before by those non-campaigning groups that registered. Indeed, the only issue that caused me concern at the previous general election was when I obtained a copy of the Conservative manifesto and saw on page 14 a full-page portrait of a named charity chief executive, who extolled the policies set out on the following pages.
In fact, at the last election I was, as is known, working for the Government as chair of a non-ministerial department, the Food Standards Agency. I was not on the Labour Whip and, as such, I did not undertake canvassing or any public speaking. So when I saw the Tory manifesto at that time, I was actually shocked. It was certainly a major lapse in the acceptable standards of conduct that one would expect from a registered charity. The person who signed off that manifesto also fell below the required standards. Frankly, I am not prepared to take any lectures about the moral high ground of non-party campaigning from this governing coalition when it pulled a stunt like that at the previous election.
Part 2 will have to come out or be substantially modified. From my three years’ experience of the coalition and of the way that we have been treated over some Bills, I am not going to trust any offer until I see it on the Order Paper.
Lord Hardie (CB)
My Lords, I refer to my entry in the register of interests as president of Capability Scotland. I will not repeat the concerns about the effect of the Bill upon the voluntary sector, which were so ably expressed by my noble friend Lord Ramsbotham, the right reverend Prelate the Bishop of Derby, the noble and right reverend Lord, Lord Harries of Pentregarth, and other noble Lords. I agree with those concerns.
I support the intention behind the provisions in Part 1 about the transparency required from lobbyists, but I fear that they do not go far enough to restore public confidence in our political system. Like many noble Lords, I consider that the provisions confine themselves to the registration of consultant lobbyists and their dealings with Ministers and civil servants at the highest level, and they fail to address in-house lobbyists. Are the public not also entitled to know of these possible influences in the formulation of policy? The duty on Ministers to disclose, on a regular basis, meetings that they have with individuals and the subjects discussed is no answer to that omission. Should that disclosure not be contained within a central database of all activity and be available to the public for inspection? In that regard, I agree with the noble Lord, Lord Tyler. However, what sanctions exist for the failure of Ministers and civil servants to comply with such obligations?
The provisions are also inadequate in another respect. The obligation of disclosure is confined to lobbying of Ministers and Permanent Secretaries, Second Permanent Secretaries or persons serving in the offices listed in Part 3 of Schedule 1. As has been observed by other noble Lords, the reality is that lobbyists will also have dealings with civil servants of a lower grade as well as political advisers to Ministers. Can the Minister tell the House why the need for transparency has not been extended to people in those positions?
I share the concerns expressed by the noble Baroness, Lady Hayter of Kentish Town, the noble Lords, Lord Ramsbotham and Lord Lang of Monkton, and other noble Lords about the lack of any consultation about this part of the Bill before its introduction in the other place.
Part 2 includes various provisions restricting the involvement of third parties in elections by altering the definition of controlled expenditure and by reducing the level of such expenditure contained within the Political Parties, Elections and Referendums Act 2000. I accept that, where non-party campaigning takes place on a scale that could have a significant effect upon elections, it is important that it is transparent and controlled. However, we must guard against imposing arbitrary limits that will have the unintended consequence of discouraging electors from engaging in the democratic process. Any controls on third parties must be reasonable and a proportionate interference with the right to freedom of political expression. The Bill expands the definition of controlled expenditure in the manner already mentioned by noble Lords and I will not repeat that. At the same time, it reduces the limit on controlled expenditure from £10,000 in England, or £5,000 in each of Northern Ireland, Scotland and Wales, to £5,000 and £2,000 respectively, at which point registration is mandatory, with all the regulatory and administrative burdens that that entails, not to mention the risk of criminal sanctions.
I, too, wish to congratulate the noble Lord, Lord Horam, on his maiden speech. I share his concern about these reduced financial limits. Will the Minister tell the House the evidential basis for reducing the limits set in 2000, given that it is now proposed that the scope of the activities to be controlled is extended? I agree with the noble and right reverend Lord, Lord Harries, that the passage of time and the expanded definition of controlled activities suggest that an increase in the limits would be more appropriate.
I have similar concerns about the substantial reduction in the national limits of controlled expenditure. Since 2000 those have been £793,500 for England, £108,000 for Scotland, £60,000 for Wales and £27,000 for Northern Ireland. Clause 26(2) reduces those to £319,800, £35,400, £24,000 and £10,800 respectively. Has any assessment been undertaken on whether the revised figures would permit a reasonable opportunity to non-recognised third parties to campaign on issues that they consider to be of national importance? I question whether those limits would permit a national rally, for instance, if groups wish to campaign against government action, such as occurred in relation to the Iraq war or might occur in relation to climate change or other environmental issues.
The Minister sought to give us reassurance on that and emphasised that expenditure would not be controlled expenditure unless it could reasonably be regarded as promoting or procuring electoral success for one or more parties. The Minister is correct, of course—that is what Clause 26 says—but what is the practical implication of that? Let us suppose that a local action group has formed to oppose the closure of a local hospital in the constituency or to support or oppose HS2 or fracking. Expenditure on relevant activities, such as advocating the views of the group, would be controlled expenditure if those views were opposed by one candidate but supported by another. Is that consequence not an unacceptable interference in the democratic process which is disproportionate and which crosses the line of legitimate control?
There is another difficulty with this part. There are inconsistencies in the statutory regime that risk confusing third-party campaigners. I refer to Scotland, where the proposed limit of £35,400 includes expenditure during the year before the general election. In contrast, the spending limit for a Scottish parliamentary election, which has been fixed by this Parliament, is £75,800 for similar activities, but the relevant period is four months. The current proposal in the Bill before the Scottish Parliament for the referendum in Scotland is that there will be a spending limit of £150,000 for similar activities during the four-month period before the referendum. Such variations will confuse third parties in that jurisdiction who wish to engage in these campaigns. Will the Minister tell the House how he can justify the inconsistencies that exist in affording the electorate the opportunity of expressing their views?
Finally, the changes to the scope and financial limits of controlled expenditure will have an effect upon the enforcement regime operated by the Electoral Commission. Will the Minister confirm that the Government expect the commission’s regulatory regime to continue to focus primarily upon retrospective action and that its use of stop notices will be confined to cases where there is a significant risk of seriously damaging public confidence in the statutory controls? What assessment has been made of the likely increase in actions of judicial review against the commission as a result of the Bill? Will the Minister also advise the House whether additional resources are to be provided to the commission to enable it to meet its obligations?
Like other noble Lords, I urge the Minister to withdraw the restrictions that Part 2 imposes upon the freedom to participate in elections that has existed since at least the 2000 Act.
Baroness Donaghy (Lab)
My Lords, I have three reasons for wishing to speak in this debate. First, I am a former member and acting chair of the Committee on Standards in Public Life. The noble Viscount, Lord Younger of Leckie, and the noble Lord, Lord Lang of Monkton, referred to the work of that committee, which spent considerable amounts of time looking at the well-being issue. There is no doubt of the importance of that area. I remember chairing a meeting in which a number of professional associations connected with lobbying were proposing a voluntary code of conduct. The real problem is to identify what constitutes lobbying or a lobbying group. During the meeting it became clear that those who abused the process would never volunteer to sign up. We were talking to the good guys. I do not underestimate the problems that the Government have in establishing clear criteria and an effective registration system: it is not easy. However, this Bill will not stop the big players or catch the bad players. It needs a major rewrite and a cross-party approach.
My second reason for speaking is as a former chair of ACAS. The certification office, which is referred to in Part 3 and has not had very much attention up to now, was part of the ACAS family. I know the excellent work that it does and I regretted that it was listed in the bonfire of the quangos. Was that only one or was it two years ago? I fully accept that it was a merger of two tiny organisations with the loss of one photocopier and that it was done for PR reasons so that the Government could claim that they were cutting red tape. The certification officer was and is required to submit an annual report to the chair of ACAS and to the Secretary of State at BIS. Just as I received them when I was chair, the new chair of ACAS will similarly receive those reports. I wish Sir Brendan Barber a very successful tenure as the new chair of ACAS.
Having claimed to scale down the certification office, the Government are now going to increase its role substantially. I understand that Ministers are setting aside £160,000 for this, so at least they recognise the increase in administration. Whatever the Government decide to require of the certification office, I am confident that it will deal with it in its usual competent way. However, I have to ask for an assurance from the Minister on a number of points. Nothing in the Bill will give the certification officer extra powers to stop industrial action or to issue injunctions. I am assuming that this will continue to be dealt with by the courts and is not an extra role for the certification office. I want a categorical assurance that trade union members in sensitive occupations such as prison officers will not be at risk of their home addresses being exposed, particularly those prison officers who work in Northern Ireland.
I also want an assurance that it is not the Government’s intention to politicise the post of certification officer. It enjoys a good deal of trust and confidence, which, once lost, would be difficult to regain. I remind the House that the certification office registers employers’ associations as well. It does not have a political fund, just like the majority of trade unions do not have a political fund. Political funds are clearly the focus of this Government’s attention. For example, if you are an employer in the nuclear power industry and you succeed in having a full-time secondment to BIS, as has happened and probably will continue to happen, who needs a political fund? In fact, who needs to lobby at all?
It is not my intention to spend time on the legal aspects of Part 2. Others are far better qualified than me to cover this. However, the Political and Constitutional Reform Committee, as has been said, in its comments on the Bill has said that it is “seriously flawed”. It calls for the Bill’s withdrawal and for a special committee to be charged with improving the Bill within six months,
“because it is in all our interests … to produce an Act that works”.
I certainly support that recommendation.
I am also grateful to Citizens UK for its briefing on Part 2. It is a civil society organisation bringing together faith groups, community and educational institutions, trade unions and other membership-based organisations to campaign on issues such as social care, the living wage, street safety or the civil status of immigrants. It seeks to achieve change by dialogue and consensus, rather than by confrontation. Citizens UK has written that,
“the Bill represents a severe curtailment of democracy and the right to campaign”.
If peaceful, official organisations are silenced in the year running up to elections, that may well lead to a spate of spontaneous or unorganised activity, to which the noble Earl, Lord Clancarty, has already referred. That could be highly effective but possibly unsafe.
If Part 2 were to prevent the National Union of Students, for instance, and individual student unions from campaigning on higher education fees, what is to stop individual students from driving around university towns with a large van with a screen on top showing a DVD on a continuous loop of Nick Clegg saying, “I’m sorry. I’m sorry. I’m very, very, very sorry” for the change of policy on fees? We may see some interesting initiatives.
My third and final reason for contributing is as a former president of NALGO, now UNISON, and a former president of the TUC. I was a lay activist and not a full-time official. I was in a trade union which did not affiliate to the Labour Party or have a political fund. It was only when NALGO was prevented by the courts from campaigning for public services that we decided we should have a political fund. The vote in favour was overwhelming. The general political fund, as it was called, gave money to various causes and political parties and groupings, and continues to do so. It produces an annual report which is summarised in the union journal so that 1.3 million members can read it.
Only when the merger between NALGO, NUPE and COHSE took place did we have to come up with a solution about party political affiliation as the other two unions were affiliated to the Labour Party. The solution was elegant. Members could choose to join the general political fund, the Labour Party affiliated fund, both funds or neither. There were four choices. If noble Lords will excuse the pun, I am labouring this point because every union has a varied history and traditions. Some 166 unions send returns to the certification officer and only 15 unions are affiliated to the Labour Party. Part 3 will affect all those unions if they have more than 10,000 members. Those with below 10,000 members constitute a mere 2.7% of the total. This fishing net—fishing was referred to earlier—has such a small gauge it would probably be banned by the EU.
The Minister in the House of Commons acknowledged that maintaining an accurate register of members is already difficult. Workers move from building site to building site—that is, if they have not been blacklisted by some hidden lobby group. Workers drive around the country or their town. They do shifts and hot-desking. They are volunteers and they do a substantial amount of the work in their union. Adding to their burden could be seen as anti-trade union. The Government should be very careful not to focus all their attention on a few trade union full-time officials. The effect on lay members will be the test. It will not undermine confidence in the union. It will be seen as part of the package of pay freezes, changes in pensions and loss of job security.
In many cases, employees and their trade union rely on the employer for up-to-date membership lists. Apart from giving more work to the employer, the proposed legislation could see a situation where the employer provides a list and then complains to the certification officer about its accuracy. Part 3 is an unnecessary and irritating diversion from the real issue of lobbying, which is where the power really lies and who abuses that power.
Baroness Hanham (Con)
My Lords, I am very pleased to take part in this Bill, even from one row back, and to have had the opportunity of hearing the excellent maiden speech from my noble friend Lord Horam. As has been said, the experience he brings from the other House will be invaluable, and I know and hope that we will hear from him frequently.
As the Minister said when he introduced the Bill, it has been a prime concern of the Government to ensure that as much of their activities as possible should be open and transparent. This Bill, with its emphasis on openness, is intended to complement the current moves towards transparency where Ministers and Permanent Secretaries must publish on the web details of those they meet on a regular basis. However, they can do that only if they know to whom they are talking and on whose behalf those people are speaking. Therefore, it seems eminently sensible that where this is not immediately obvious there should be ways of ensuring that those companies are known about.
Mention has been made of in-house lobbying and there was a general emphasis on companies like British Gas. This is not relevant because a company like British Gas will come to see a Minister on the basis of being British Gas, unless it is going to go for a big public relations company, in which case it will then have to be registered. So that is not a problem and there has been no intention in this Bill to deal with what someone called management consultants.
So the Government work on the basis that the electorate have the right to know what has been done in its name by whom and for whom. The aim of the measures in this Bill is to do just that. The requirement that those large organisations whose business it is to lobby senior members of the Government and Civil Service on behalf of their clients should have to be registered and declare the names of those on whose behalf they have made, or are making, representations is long overdue. Whether, as has been suggested, this should go further down the pay scale will be discussed during the passage of the Bill.
That those working on their own or others’ behalf to influence candidates or parties at elections should be regulated, and thus transparent, could be seen as providing more openness to such influence, as also ensuring that trade union members’ records are up to date. So the three elements of the Bill are all directed towards the same outcome—that any influence, or attempted influence on the democratic process should be out in the open.
The other side of the coin is that legislation should also be transparent to those who are affected by it, or believe themselves to be so, so that people can understand not only what is intended but that the legislation is being made to work. Often this has to be left to secondary legislation or guidance. However, from all the briefing we have received and from today’s contributions, it is clear that despite amendments made in the other place there is still a perceived if not an actual lack of clarity about whom the provisions in Part 2 will affect and how. There is concern on the part of charities in particular and the voluntary sector about the interpretation and implementation of the regulation of third parties’ activities during the purdah year prior to elections. The Government specifically tried to satisfy concerns in this area by the amendments and reassurances they gave in the other place but it is obvious from the contributions that we have heard today that it is still an issue.
At least because of the fixed-term Parliament it is obvious where the year starts, which is not the case under the current provisions in the Political Parties, Elections and Referendums Act. It may be that one of the things we should address is the length of this purdah. I remember well the passing of the Political Parties, Elections and Referendums Act. There was a great deal of consternation about the fact that there was a year, particularly relating to constituency associations, in which everything had to be declared and there could be virtually no political activity within that year. I think that, as the noble Lord has said, we might need to look at whether this year the whole year is too long or whether that should be curtailed. Nobody has briefed me on this; I suggest it entirely by myself as it appeared just as a thought as we were going along.
I have been briefed, as have other noble Lords, by various bodies and organisations, including the Electoral Commission and also by the National Council for Voluntary Organisations. As a percentage of that is now made up by Volunteering England, I should declare my former presidency of that organisation because I have read its brief very carefully and the noble Baroness, Lady Pitkeathley, and I have shared in the work of that excellent organisation.
NCVO is particularly alarmed at the changes being made to the Political Parties Elections and Referendums Act which it feels make it more or less impossible for charities and other interest groups to campaign, even on non-political issues—I know this is not the point of the Bill and I am sure that the Minister will make that clear—during the election purdah for fear of breaching the proposed provisions in the Bill on their interrelation with political parties or candidates and the reduction in allowable expenditure, the wider regulation of what has to be included in that expenditure and the interpretation of what could be considered electioneering or trying to influence a particular outcome by projecting their policies.
I agree with my noble friend Lord Tyler, who is not in his place, that it is essential that we tease out the relationship between this Bill and the charities law to ensure that they are compliant. Charities and similar organisations have already been excluded from the provisions in Part 1 of having to register as lobbyists, so they are not affected by that aspect of the Bill. I have also noted the long briefing from the Electoral Commission, which in effect supports many of the concerns which have been made by other bodies as well as how it is to operate in its new extended remit. It has indicated in the Appendix A to its brief how it would interpret the likely regulations and provisions but it does consider that some if not all of the concerns being raised are justified.
In principle, I support the aims of the Bill. Greater transparency is something for which we should all aspire but there is more work to be done to ensure that there are as few ambiguities, unintended consequences and unclear provisions as possible because the more of those that remain the more this Bill can be misrepresented. So I hope that we will be able to clear those up as we go along. I am sure that there will be amendments laid to try to deal with these, most of which are essentially practical, as noble Lords have said, but which can be open to misinterpretation. I believe that the Electoral Commission is still having discussions with the Government and I look forward to the report being compiled by the new commission of the noble and right reverend Lord, Lord Harries.
I am sure that many of these issues can be ironed out while the Bill is in this House. I know, too, that even in the short time left between now and further stages, representatives of the organisations which will become non-political third parties would want to put their anxieties directly to Ministers. I know from having dealt with previous legislation that it is amazing how quickly this House can move. So I do not think that it will be at all necessary for the Bill to be delayed and we can work within this timetable.
In conclusion, at least some of the concerns that have been raised seem to be justified and I hope that through further discussions, reassurance from the Ministers or government amendments we will manage to allay some of them. Knowing the Ministers leading the Bill, as I do, I am certain that they will be doing just that. At the end, while all organisations may not be happy, they may at least feel that their issues are understood, that many have been dealt with and that they have been listened to.
Lord Monks (Lab)
My Lords, I join the chorus of critics of this blunderbuss of a Bill. It is quite a big chorus, who expect to be heard with their many concerns and, although it is a very diverse one, stretching across many organisations whose views have been reported by other speakers, there is a remarkable degree of harmony in its view of this Bill.
Critics of Parts 1 and 2 abound, but I shall speak mainly about Part 3. I remind all noble Lords about what the three committees in the other place have thought about the process adopted so far. They have been extremely and uncharacteristically critical—and united across all parties in their criticisms of the way the Government appear to be making it up as they go along at different stages on different issues. In those circumstances, there is a heavy responsibility on the House of Lords, and I hope that we will accept it. I hope that we will do our duty as a revising Chamber that seeks to express its wisdom on the way that legislation is made. On this Bill, more than on many others, we have a duty to do so.
As I mentioned, others have dwelt on the weaknesses of Parts 1 and 2. I will not repeat their points because I shall move on to Part 3, the trade union bit of the Bill. I think it was Joseph Heller who wrote in Catch 22 that:
“Just because you're paranoid doesn’t mean they aren’t after you”.
In the trade union ranks, we feel that somebody is certainly after us. That sums up the mood of many people in the movement. We are to be enveloped in new and expensive red tape, and we are being singled out for a kind of special treatment that no one else is being singled out for. Is there some supporting evidence of what we have done wrong in this area? Do we have some flaw that needs public intervention? Is there any evidence that our membership records are dodgy?
Unions will be required to employ a new, independent assurer—that is a new word for me in this circumstance—and those with more than 10,000 members will have to submit a membership audit certificate prepared by the assurer. In addition, the certification officer will be able to make copies of membership records. Let us remember that: a public official will be able to make copies of union membership records. That is a feature of societies that are a lot more repressive than ours. It is an intervention in the internal affairs of a union. I think that what is developing in this country will alarm people in the International Labour Organisation. It is not a small point, it is a big one.
I am sorry that the noble Lord, Lord King, is not in his place at the moment, because he knows well the range of existing requirements that unions have to meet in terms of their administration. They must make an annual return to the certification officer and they must have an independent scrutineer on secret ballots, which we very much accept. Anyone can complain about maladministration in the union. It is not easy to keep union records in areas like construction, retail, hotels and catering, which have rapid staff turnover.
What is the situation? Between 2000 and 2004, the certification officer received six complaints. Five of them were thrown out and in the sixth case, the declaration that was sought was not issued. Since 2004 no complaints have been made to the certification officer. Where is the evidence to justify a major legislative intrusion into union administration? There is no evidence for it. People talk about the need for transparency, but transparency for whom? Who wants this information and who is going to get it? As the basis for a new law, it really is ridiculous.
We have these existing obligations and we want to make sure that the way in which we carry them out is for the benefit of union members and is exemplary in terms of our administration. We do not want to open a door so that our records may become available to those who blacklist union activists. We have seen recent evidence of that in the construction industry. Once individual membership records are distributed more widely, where will they end up? If transparency is such a brilliant idea in this area, why do we do not do it for political parties? That would be quite interesting to a lot of people. Why not put them in the glare of the sun? We would then know for sure what the true membership figures are. Surely we have not reached the stage where we have to legislate to remedy an assumed problem for which there is absolutely no evidence. This is red tape gone mad.
The cost to the unions of the assurer and all the rest of it has been estimated, according to the Government’s own figures, at a minimum of around £460,000 a year, while the Government will be required to fork out another £130,000 to £150,000. I will just say this: going down this route is a waste of union members’ money and a waste of taxpayers’ money. If the Government have evidence, they should bring it forward. If they have not, I suggest that they should at least pause and think again about this provision.
Are there darker motives behind these provisions that are not being revealed? Is it a way of opening up union membership records so that employers can check industrial action ballots? I would be grateful if the Minister would comment on that tonight. Is it simply to put a tribal spanner in the union works so that we have something else to wrestle with and waste our money on, rather than tackling the kind of agenda referred to by my noble friend Lady Donaghy: the living wage, job security and all the other things that we will want to talk about in the run-up to any general election? This is a bad part of a not very impressive Bill and I hope that the House as a whole recognises that Part 3 is a waste of time, a waste of effort and a waste of money. Those are good reasons for a pause.
Lord Griffiths of Burry Port (Lab)
My Lords, I need not detain your Lordships for long because so much that needs to be said has already been said, and I shall try not to repeat it. The reports of the various committees have been adequately quoted and they are now on the record. I would simply say that I, too, want to stand by the thrust of them all. Observations have been drawn from the Bill itself, especially around the key points set out in Part 2. They have been repeated so, once again, I need not address the ambiguities and the lack of clarity in some of the phrases at the very heart of the proposals. The question that has been asked more than once is one that I will repeat without addressing it: what is the problem to which Part 2 is supposed to be an answer? In repeating the question, I hope that the Minister who is to reply from the Dispatch Box will do his best to see if he can provide an answer, since it has been raised several times.
At the outset of the debate, the noble Lord, Lord Tyler, declared that this Bill was a most misunderstood piece of legislation to which he sought to bring clarity. Pretty much all the speeches that have followed have shown just how misunderstood the Bill is, so he is to be congratulated on his prescience in getting the mood of the House right. I would like simply to piggyback on some of the methodological ways in which the cases have been built. The noble Lord, Lord Ramsbotham, drew on his extensive experience in the criminal justice system to explain how he felt that the proposals in this Bill will impact on organisations working for rehabilitation and restoration within that system. We then heard magisterial speeches from my noble friends Lady Pitkeathley and Lady Donaghy on their respective cases, once again drawing on a wealth of experience and suggesting what might well be, at least prima facie on looking at the Bill, its impact on the activities that they have spent their lives addressing. We heard the noble and right reverend Lord, Lord Harries of Pentregarth, talk about how the committee that he chairs is drawing its own uneasy conclusions from the legislation as proposed thus far: its haste, its ill judged nature, the way it has been put together so thoughtlessly with no pre-legislative attention, and so on.
I have been thinking about the year-long exclusion zone when all these bodies, agencies and the rest of it are not supposed to indulge in overt political activity. I remember being the victim of just such an exclusion zone myself. I used to do the “Thought for the Day” piece on Radio 4. Since I was at the time the vice-president of the Christian Socialist movement, as soon as an election of any kind drew near, I was withdrawn from the list of contributors because it was obvious to everybody that those two and three-quarter minutes between a quarter to eight and ten to eight in the morning could constitute a real undermining of the political process in this country. I just wish that I could have had the opportunity, if it was acknowledged that I had that power.
It is ridiculous for bodies that are set up to achieve certain objectives to be denied the opportunity to campaign and advocate for the realisation of those objectives. That is their raison d’être. I pick up on the intervention of the noble Lord, Lord Judd, in an earlier speech. There is a contradiction between charity law which requires a charity to do all it can to maximise income to address the objectives for which it is set up as against the way some of the provisions in this Bill just might work out.
I draw a couple of things from personal experience, after which I promise your Lordships I will sit down. For many years, as some of you know, I was living in Haiti. While there, we did everything we had to do to address the dire poverty. We sank wells, we organised co-operatives, we arranged microfinance, primary healthcare, education, literacy and we planted trees. We did everything, and my little outfit looked for collaborators and people of good will with whom to work. We found them in the NGOs and agencies from Britain and from other places around the world.
When I came back from Haiti to live in England, I was burning with the desire to continue with this work. I knew, although we had barely slept some nights because of the work there was and the depth of the poverty we were addressing, that all we had done was dip a toe into the waters. I came back wanting to advocate, wanting to campaign, wanting to get British public opinion onside for what remained to be done. We formed coalitions of interest; we campaigned on the streets; I put together a support group for Haiti; and so it went on.
It becomes natural when the fire burns deep inside the soul for people with common interests to put their energies together in order to knock on the door of government—in order to knock down the door of government, if necessary—so that it can be seen that something needs to be done and that the complacency with which people in countries such as ours live is not to be tolerated.
When I was working as the president of the Methodist Conference and touring the country, I made homelessness the charity that I wanted to support. I was briefed at every point by Shelter. I had been the director of a housing association, also working closely with Shelter. When Occupy did its stuff in the graveyard of St Paul’s Cathedral a couple of years ago, it had quite a lot of my sympathy—as well, at the end, a little bit of my frustration. If housing charities, whose work it is to try to alleviate homelessness or to draw attention in the public domain to the evil nature of the homelessness and the suffering going on because of an inadequacy of supply and an incapacity to meet the rental charges that young people and others are facing, do not take to the streets, knock on the doors and stir up public opinion in the year before an election, I will be very disappointed. If this Bill does anything to stop that, I will be very angry indeed. I wish it were withdrawn. I would like to hear what the Minister says about that.
Baroness Hollins (CB)
My Lords, despite government attempts to allay fears about this Bill, as we have been hearing today and as our mailboxes confirm, there are still grave worries from charities, voluntary organisations and other third-party organisations—worries that their everyday activities will be seriously affected by the excessive bureaucracy required by the legislation. I believe that all non-party political organisations should be allowed to continue their usual work in raising and campaigning on issues relevant to their aims and objectives—even in an election year.
We have been told that the Government do not intend the Bill to prevent non-party political organisations supporting, engaging or influencing public policy, and that the new amendments were intended to address misunderstandings about its intentions with respect to third-party campaigning. But despite these amendments, anxieties about what third-party campaigners can and cannot do are unabated. I will give a couple of examples in a moment.
There is considerable uncertainty and ambiguity in the wording of the Bill. It is still unclear whether third-party campaign groups will fall foul of the rules if they support specific policies that might also be advocated by one or another political party. For example, in healthcare, would organisations concerned about alcohol, tobacco or mental health issues be able to debate, comment and campaign on these matters without being so restricted by this regulation that they are prevented from carrying out these core activities? These are the questions that people are asking.
There are other questions too. It is currently not clear which expenditure limits amount to “controlled expenditure” and thus fall within the applicable limit. For example, the Government amended the Bill to exempt the costs of annual conferences, but the costs of public rallies, meetings or other events are still included. I therefore have a question for the Minister. Which category would apply for a membership organisation that organises a conference for its members, but which also has a public element with non-member observers and with an invited media presence?
The summary of all this uncertainty is that many organisations share massive apprehension that the Bill could severely limit their day-to-day activities by introducing what some see as an over-the-top regulation. It is not just charities and voluntary organisations that have concerns about the changes; politically non-affiliated trade unions, such as the BMA and the RCN, are concerned that the new amendments do not go far enough. An excellent briefing from the Royal College of Nursing explains that during the general election campaign of 2010, it campaigned on behalf of its members on healthcare issues, such as maintaining investment in services, improving care for older people and a focus on public health. Candidates from all parties were asked to support these priorities and their responses were shared online. Campaigns such as these, aimed at raising standards of care in the NHS, would not be possible if this Bill becomes law. In the eyes of the RCN, the reduction of spending limits and the bureaucratic burden imposed would render this type of activity impossible.
In the other place, the Government offered assurances to charities and voluntary organisations, but I would welcome assurances that they have fully considered the impact of the legislation on other types of third-party groups, such as politically non-affiliated trade unions like the BMA and the RCN. These are trade unions which play key roles in campaigning on issues in the public interest. I declare an interest as the chair of the BMA Board of Science, which raises awareness of public health matters.
The legislation feels rushed. The lack of adequate pre-legislative scrutiny and consultation with those affected is likely to result in a disproportionate and unworkable regulatory regime with damaging consequences.
I add my voice to those calling for Part 2 to be removed from the Bill, or at the very least for a pause for the Government to reconsider. I am sure it is not the Government's aim to limit debate and freedom of expression in this way. I hope the Minister will fully address the concerns that have been raised during this debate.
Lord Haskel (Lab)
My Lords, as the Minister has said, we would all like to know who is buying power and influence and, yes, we would all like to see the light of transparency shining into this murky world. The trouble is that this Bill does not do this, as many noble Lords have demonstrated. Let me briefly say why.
Part 1 calls for a register of lobbyists. In order to deliver transparency, surely a register must include all those who are lobbying and who is employing them. At present, there is a voluntary register that tells you this about some organisations—those that register. The register in the Bill, however, is so narrow and so full of loopholes that it frustrates responsible firms while encouraging irresponsible firms to profit from the loopholes. It muddies the voluntary code. The acting chair of the UK Public Affairs Council, speaking about the register, said:
“People will be able to construct their business never to be on it”—
so much for those who say that a full register is unnecessary.
What are these loopholes? As my noble friend Lady Hayter, the noble Lord, Lord Norton, and many noble Lords have pointed out, only political consultants are required to register, but we are told that 99% of the contact between Ministers and Permanent Secretaries is not by political consultants but by representatives of corporations or special interest groups, and they are not on the register; nor are those who advise on how to lobby, a major activity of modern lobbying. This can be an individual or a small organisation, but small organisations are to be excluded. “Small organisations” means those not registered for VAT. The Minister does not need me to spell out the loopholes in that.
The Bill requires transparency only when you lobby a Minister, a Permanent Secretary or other senior staff. But, like all of us who have worked in government, the Minister knows that most briefing comes from lower down, usually from experts in a particular field. Moreover, this is not the level where most public concerns lie and where much public money is spent. The NHS, local enterprise partnerships and public services provided by the private sector inevitably involve more junior public servants—again, often experts in their fields—but it is here that many members of the public would like to see the shining light of transparency. Also, what about special advisers? As we have heard, their influence has even brought down a Minister.
Part 1 of the Bill does little to support the public interest. Property developers and planning, banks and regulation, education and free schools are all areas where lobbying affects the public interest, yet most will fall outside the scope of the Bill. Instead of giving people confidence in our political system, Part 1 just provides loopholes. We all know that loopholes attract the irresponsible; they lower standards and the public interest suffers. Talking about standards, are the Government satisfied that Part 1 of the Bill will deal with unethical behaviour by lobbyists? The voluntary register has a code of conduct. Surely the Government’s register should also have a code of conduct; otherwise, there will be little pressure to raise standards.
Part 1 of the Bill is not only poor legislation, it is unfair. If a small organisation wishes to campaign against tobacco packaging or alcohol pricing, its consultant lobbyist would be far more tightly regulated than the in-house lobbyists of the drinks or tobacco companies. This applies in many spheres—for example, in health, as the noble Baroness, Lady Hollins, has just told us. All this does is protect vested interests and make it more difficult for the weak to stand up to the strong.
How can we put this right? First, by defining lobbying properly. We should respect the existing lobbying registers and give them more force. If there is to be a Bill, everybody involved in lobbying will have to be drawn into the net. Figures given in another place estimate that some 350 companies will be caught by the Bill. The UK Public Affairs Council estimates that 100 would be caught—from about 15,000 people and firms that operate as lobbyists. That is why Part 1 of the Bill is pointless.
As many noble Lords have pointed out, this is a difficult area for lawmaking, partly because lobbying is difficult to define, as the noble Lord, Lord Lang, explained. I will give your Lordships one more example. It has been known for lobbyists to work as researchers for noble Lords and to provide a secretarial service to all-party groups. Some firms second staff for particular projects to Ministers and government departments, and to the Opposition. Are they lobbyists?
It is hard to separate lobbying from campaigning. However, I agree with the Minister and most noble Lords that lobbying is valuable. The noble Lord, Lord Wigley, explained how it informs debate because we are all influenced by logical argument and genuine knowledge. Getting this into the Bill is difficult. Yet, as your Lordships’ Constitution Committee tells us, the Bill is being rushed through without pre-legislative scrutiny and with little debate in another place. The Political and Constitutional Reform Select Committee in another place unanimously described it as skimpily scrutinised and deeply flawed—so much for the Minister’s assurances in his opening remarks. That is why it is bad legislation.
Our duty is either to improve the Bill by amendment or to reject it. We will try to amend it to more closely define lobbying. We will try to draw the net much more widely. We will try to remove the loopholes. We will try to respect the standards of the industry set by the voluntary code. Otherwise, it is our duty to reject the Bill and ask the Government to think again.
Lord Whitty (Lab)
My Lords, like many noble Lords who have spoken, I regard Part 1 of this Bill as being probably well intentioned but very perverse in its effect. Part 2 may or may not be well intentioned but is certainly pernicious in its effect. Part 3 is just pernicious. I have some critical points to make on all parts of this Bill. Many of them have been made already, but that will not prevent me from repeating some of them; there are some things that I wish to underline in all three parts of the Bill.
I also want to say something to Ministers and noble Lords opposite, particularly those of a more liberal disposition in either of the coalition parties. I think that there is a feeling in government that the objections to this Bill of the committees of both Houses, of all the organisations in civic society that have been cited and of noble Lords today is due to oversensitivity, suspicion or even paranoia. But, frankly, the Government have done little to overcome that paranoia. They hope that during consideration of this Bill they will manage to do so, but I doubt it because it is part of a wider problem for this Government.
Looking at the wider issue, when the Westminster Foundation or other human rights bodies promoting democracy in Africa or the former Soviet Union visit these emerging democracies, one of the key elements that they wish to develop is the voice of intermediate democratic representative bodies—local government, trade unions, faith bodies, co-operatives, charities—all the kinds of bodies that will be hit by one or other of the provisions of this Bill.
Let us think about this Government’s record. In the third week of this Government, an instruction went from the Cabinet Office to all quangos and arm’s-length bodies that they were no longer allowed to campaign or to try to influence legislators. Then we had the instruction from DCLG to local government that it had to drop or cut dramatically its campaigning activity. Then we had the various restrictions on access to justice, to tribunals and courts, and the cuts in legal aid. Ministers can defend every single one of these moves individually, but the totality adds up to an attack on or at least an undermining of essential elements of our civic democracy. Democracy is not all Westminster or the big issues; it is what goes on in civic society down the line and how people express themselves collectively and individually through those intermediate organisations. The Government need to reflect on that. I particularly ask the noble Lord, Lord Wallace of Saltaire, to do so, for I know him to be a liberal person of great democratic credentials. I am not saying anything different about the other Minister sitting on the Front Bench, but I say that today, because it is worrying.
Most of my points on the Bill have been spoken to. On Part 1, we need greater transparency in lobbying, but, as my noble friend Lord Haskel and others said, we are attacking the wrong target at both ends. The only register and requirements are for consultant lobbyists. Consultant lobbyists are a relatively new operation in our democracy. Some of my best friends are now consultant lobbyists, partly because it has been a bit of a job creation scheme for the wannabe, has-been and never-were politicos of various sorts, but, as my noble friend said, they are not the major part of the lobbying industry—far from it. Some organisations see a need to use consultant lobbyists; some do not really need to. The really big, effective lobbyists do not need to. Rupert Murdoch does not need a consultant lobbyist; EDF and the Chinese Government do not need consultant lobbyists; pharmaceutical companies and defence contractors do not need them. Some of them use them occasionally, but they do not need them because they have the power to address Ministers and senior civil servants directly.
I do not know what the solution is to that huge area of lobbying. As the noble Lord, Lord Lang, said, it is very difficult to have a single definition of lobbying. As I remarked the other day, sadly, anybody who wants to talk to a politician is not really there to enjoy their sparkling conversation, their erudition and wisdom, still less their erotic allure; people are there because they want something. In one sense, almost every encounter that a politician has with a member of the public or a representative of an organisation could be defined as lobbying. We have to pin it down—I understand that—but the fact is that Part 1 does not tackle that problem. We are hobbling the minnows while we let the sharks swim free.
It is also about the other end of the process. We all know from being in or anywhere near government that it is very difficult to get the ear of the Secretary of State or the Permanent Secretary, but it is much easier to buy lunch for the person who has their ear—the spad, the private secretary, the assistant secretary or the grade 5 who is actually drafting the legislation or assessing the contracts. They are completely excluded from the Bill, so the Government have got it wrong at both ends of how we are to introduce transparency in the lobbying sector.
On Part 2, a lot of points have been made both in the House and outside, in the literature that we have all received. It is right that there should be restrictions on third parties in electoral situations. It is right that we should be worried about an American-style super-PAC development here. That is why the Labour Government introduced PPERA in the first place 13 years ago, but Part 2 restricts the activities of third parties beyond the degree that is necessary to protect democracy. It reduces the threshold, so that very small organisations have huge burdens placed on them; it widens the definition of what is to be electorally relevant or regulated expenditure; and it cuts significantly the amount of money that third parties can pay over a period of 12 months before an election, not just the four or five weeks of the election campaign itself.
Obviously, third parties’ campaigning activities can be said to be aligned with one party or another, or with one candidate or another, either locally or nationally. The cutting of expenditure and the widening of the activities that are covered by it will have a drastic effect on many local campaigns—and very soon, if the Bill goes through. We are only 18 months off the general election; we know when it will be these days. Within six months or so, the £5,000 limit on a constituency basis—we need a limit at that basis—will prevent a number of local campaigns against the closure of hospitals, for or against wind farms, for or against particular developments, or campaigns against HS2. All of those local campaigns could fall foul of the constituency limit.
At a national level, several major political events over the past few years could not occur in future in the 12 months before an election, because they would be too expensive. In that, it is not just one organisation’s limit that must be taken into account. If several organisations are in coalition for an event, it is the aggregated cost that is controlled, which includes such things as staff costs of the organisation. In those circumstances, for example, at no time in the 12 months before an election could the TUC organise another March for Jobs. It is highly probable that the BMA would find it difficult to organise a campaign about health service reforms. I see my noble friend Lady Mallalieu here. It would be very difficult for the Countryside Alliance to organise a march of previous proportions against a foxhunting ban. God forbid, if we were engaged in some new military intervention, it would be very difficult for a coalition against the war to organise a march against it. All such events would come up against a limit for 12 months. That is a serious limitation on our democracy and something that this House should not allow through without serious objection. That is not a healthy democracy.
Part 3 has trade unionists specifically in its sights. My noble friends Lord Monks and Lady Donaghy have already pointed out the absurdity of that and others have queried why we are doing it at all. Of course, in my paranoid mood, I think that there are two or three potential reasons. One is that it might make strike ballots even more challengeable in the courts than they already are. Another would simply be to impose additional costs on trade unions, limiting their activities. A third is that it is primarily directed at the political funds of trade unions and therefore has an effect on the finances of the major opposition party.
To intervene in this way 18 months before a general election in some emerging democracies would rightly provoke serious condemnation around the democratic world. I will return to Part 3 at later stages. I ask the Government to stop demonising trade unions and to stop the other interventions that this Bill represents, which seriously limit our democracy and the involvement of a whole range of different sorts of organisations in democracy. Ministers may think that our reaction is an exaggeration, but part of the duty of this House is to be vigilant. We must be exceptionally vigilant about this Bill.
Baroness Kidron (CB)
My Lords, the right reverend Prelate the Bishop of Derby, in his evocative speech, described the voluntary and charity sector as a source of political energy. I will address my remarks to the subject of political energy.
I know that I am not alone in your Lordships’ House in my concern that young people are increasingly unmotivated to participate in the conversations and campaigns of public life. The Bill exacerbates their disengagement. As we have heard repeatedly, Part 2 simultaneously extends the scope of what is considered electoral campaigning and lowers the threshold of spending, at the same time as introducing double accounting for the spends of organisations that work in coalition. The cumulative effect of that creates the possibility of silencing the voices of campaigners and of charitable organisations.
Many of us know that a commitment to a single issue or principle is the start of a broader political understanding: a broader political journey. To curtail the voice of the third sector, which has from all quarters expressed its fear of falling foul of the Bill, is to curtail one of the most important places in which young people traditionally find their voice.
The National Union of Students is just one of many organisations that fear that the Bill will curtail the important job of introducing young people to the world of public debate and political discourse. It is concerned that the Bill’s lack of clarity and need for legal opinion will price many of its poorer branches out of politics altogether—particularly further education colleges, which noble Lords will know have a high number of students from backgrounds not adequately represented in elite sections of society. Conrad Grant, president of Goldsmiths Students’ Union, is worried about how the legislation will impact on its voter registration drives that are linked to affordable housing and a living wage for part-time work. These are two issues of increasing concern to students, particularly those faced with the London rental market.
What better way can we find to engage young people than a national debate about lowering the voting age to 16, and who better to propel that debate than the NUS? Yet NUS President Toni Pearce says that she worries greatly that the entirely legitimate and important work that student unions undertake in engaging students in politics will no longer be possible if Part 2 passes in anything like its current form. Noble Lords should bear in mind that the NUS, in complying with child protection laws, has to provide staff supervision for the under-18s, the costs of which under the new legislation would be attributable to their election spend.
The noble Baroness, Lady Donaghy, referred to the issue of student fees, and the NUS believes that its 2010 Votes for Students campaign against raising student fees would fall foul of the new legislation, were it to happen at the next election. I hope that I am not alone in feeling that it is the democratic right of students—possibly their responsibility—to take a view on legislation that has such a profound effect on their education and then on the remainder of their adult lives. In this instance, the election of individual MPs was not their primary purpose, but it could in retrospect be argued that it could reasonably be regarded as looking to influence electoral outcomes, since the campaign helped to secure the election of a number of MPs who signed the pledge not to raise fees. Is it not legitimate in the ecology of our democratic processes that students take into the next election the lessons of the last?
In the new year we will see the introduction of individual electoral registration. This legislation will disproportionately affect young people as they move to educational institutions or to new towns and cities in search of work. To whom shall we turn for a campaign to put the young on the electoral roll? Perhaps to a coalition of youth-facing organisations, each of which—under the terms of this Bill—will find themselves having to account for the spend of the whole. Is it not the case that creating any barrier for organisations who work to engage young people in politics, and who encourage them to participate in our democratic processes, is doubly concerning in the context of IER? If we truly want an engaged electorate, as I believe we all do, if we want to encourage young people to feel that the political class is not disinterested, if we want a new generation to come to the table with their concerns and needs, we must drop as many barriers as possible—not reduce the ways and circumstances in which they can engage and pull up the drawbridge behind us.
Like others, I have been overwhelmed by representations revealing the anxieties of the third sector, including from a number of trade unions, mostly unaffiliated to the Labour party, which feel that the Bill creates punitive administrative burdens on ordinary working people. Noble Lords have spoken in detail about the provisions of the Bill that will curtail legitimate campaigns from charities and NGOs. As well as the practical aspects, there is the message of this Bill, which is that politics is owned by politicians—and that does untold damage to the public engagement of young people.
The purpose of the Bill, as described by the Government, is missing on the page, and I ask that they take the advice of the multiple committees whose concerned opinion we have heard this afternoon, pause the Bill, and, in doing so, take the opportunity to make more equitable the burdens on the third sector, trade unions and business. Above all, I hope that Ministers will agree that it will be a bad day for politics in its broadest sense if, instead of harnessing the political energy of the young, the Bill that they propose denies the voice of the young.
Lord Stevenson of Balmacara (Lab)
My Lords, I declare an interest as a retired member of Unite.
The briefing circulated about Part 3 says that it is simply intended to change,
“the legal requirements in relation to trade unions’ obligations to keep their list of members up to date”.
In fact, as we have already heard today, the Bill introduces additional requirements to the existing duty placed on—and long accepted by—the trade unions to maintain an accurate and up-to-date register of members. Union membership is already regulated by the Trade Union and Labour Relations (Consolidation) Act 1992, and Section 24(1) puts a duty on unions to maintain a register of members’ names and addresses, so far as is reasonably practicable, that is accurate and up to date.
We are not aware of any calls having been made to the Government to extend this provision. I understand that BIS, the certification officer and ACAS have all confirmed under FoI requests that they have received no representations to introduce such a measure. No one has campaigned publicly for such a change. They will not be able to in future. The proposed legislation will place on unions onerous and unjustified additional administrative burdens that often duplicate existing regulations. The legislation also appears to violate fundamental rights to privacy and freedom of association which are safeguarded by the European Convention on Human Rights.
Like many other noble Lords, we are unable to work out exactly what problem the Government are trying to remedy. Unions already have a legal duty to keep accurate membership records, and it is in their interests to do so. Not only do good membership records increase income and minimise expense, any union involved in an industrial action ballot knows that an employer is likely to legally challenge the ballot if there is a suspicion of inaccurate records. Unions also need accurate membership records in order to carry out their internal democratic processes, such as elections. Most people would probably agree that people should not have to reveal whether they are members of a political party to members of the Government. Yet this is what the Bill proposes for trade union membership.
If this Bill is passed, each large union’s assurer, the certification officer appointed by government and an investigator appointed by the certification officer will have access to private membership data. As my noble friend Lord Monks said, at a time of growing revelations about blacklisting of trade union members, obviously we need to be concerned about how this might breach members’ privacy.
The TUC believes that if this change to the law is to be made there ought to be similar specific requirements in the legislation for employers to give unions the most recent data on those employed, those on sick leave, et cetera. Unions otherwise have no way of knowing to the necessary degree of accuracy who is currently working in the firm or business. I would be interested in the Minister’s reaction to this rather ingenious suggestion for symmetry.
The basic role of trade unions is overwhelmingly supported by voters. According to a recent MORI poll, 78% of people support the statement that trade unions are essential to protect workers’ interests. However, this extra red tape can only hinder unions carrying out their proper role. The new regulations will significantly increase their workload and costs for the certification officer, but it is far from clear what benefits the increased regulation will yield for the wider public—including businesses—and how the increased cost to the taxpayer can be justified.
At Second Reading in the other place, the Leader of the House of Commons said of these clauses:
“It will require trade unions visibly to demonstrate that they know who their members are and can contact them. The principle that unions must be able to contact their members is well established in legislation”.—[Official Report, Commons, 3/9/13; col. 184.]
Well, he is right; it is well established in law already. The facts bear this out. The certification officer’s annual report for 2012-13 says that 166 trade unions submitted annual returns recording a total of 7,197,415 members. The annual return has to include a copy of the auditor’s report in the accounts, allowing the certification officer to compare revenue from dues with the numbers reported, so the information is already available in the public domain for anybody to dig into. I would have thought that any reasonably independent person looking at these publicly available reports would agree that the Government already have quite extensive information-gathering powers on the finances and membership of trade unions.
The trade unions have complied with the current legislation every single year since it was introduced and the published figures are, as I said, available to the public. We must wonder whether the certification officer needs any of these powers, given the extremely low level of activity which others have reported. Indeed, people will be asking themselves whether the powers being proposed are unnecessary and disproportionate. The answer is clearly yes, so we on this side of the House are opposed to the proposals in Part 3.
In his reply, perhaps the Minister can answer some questions about the detail here. Has the certification officer asked for additional powers or approached the Department for Business, Innovation and Skills to say that these powers are necessary and that he would like the Government to legislate to ensure that they are introduced? Has the department consulted the certification officer, trade unions and other relevant organisations on whether the powers are required and, if so, can he make available to us what evidence they relied on? Have the Government any proposals for regulations that will be removed to alleviate the additional burden of regulations they wish to place on trade unions? I thought that we were in favour of one in, one out. Lastly, I assume that an estimate has been made of the additional resources which will be needed by the certification officer. Can the Minister set out what the spending commitment is in this area?
We believe in the right of working people to organise and to stand up to unfair treatment in the workplace. Free trade unions are part of a vibrant democratic society and the partisan use of the law in an attempt to disrupt their efficient administration is as wrong as it is unwelcome. This is a bad Bill. At Second Reading in the other place, the shadow Leader of the House of Commons said:
“It is a Bill that the Government should be ashamed of. It is incompetent. It is rushed. It has been developed in a high-level meeting between the Prime Minister and his deputy, but with no other consultation”,
in crucial areas.
“It is a sop to vested interests, an illiberal attack on democratic debate and involvement, and a cheap, partisan and cynical misuse of the legislative process for the Government’s own ends”.—[Official Report, Commons, 3/9/13; col. 199.]
The Prime Minister and Deputy Prime Minister forget that the people they attack are the people who deliver the mail, serve in the shops, teach our children, care for the sick, look after the elderly, clean our streets, assemble our cars and build our bridges. They deserve better than to be subjected to yet another piece of the Tory ideological jigsaw.
Lord Lea of Crondall
My Lords, the Bill takes us back to the insulting doctrine that trade unions are the enemy within. When I first saw it, I was rather shocked—but then I thought that it must be some sort of spoof written by the provisional wing of the Committee on Public Safety. The first point which I ask the Minister to comment on is that it is very asymmetrical so far as trade unions and employers are concerned. How can he say that all these requirements should be placed on trade unions, at vast cost, without parallel requirements being placed on employers?
In the published material that one finds, with difficulty, in the Printed Paper Office as the Part 3 financial assessment, we have a fascinating set of paragraphs on pages 3 and 4. It is headed:
“Evidence Base … Problem under consideration”,
and it is worth reading. It says:
“An increase in an individual union’s membership diversity and membership turnover is a key reason why managing a large database of members is complex. It means that the information held in the unions’ registers will decay rapidly. In addition, the information held on the registers will decay for other reasons: changes of addresses; and deaths, divorces, and marriages … All of these changes may undermine the accuracy of union registers, unless adequate and relatively frequent management procedures are in place to resolve inaccuracies and maintain the register. Some of the reasons for inaccurate data are explored in more detail below”.
We get fantasy piled upon fantasy as we come to that more detailed explanation, which goes into gross and net flows by work status, the high degree of churn in the UK labour market, and the flow estimates of the size of movements between the three main labour market statuses of employment, unemployment and economic activity. So it goes on.
Then the material comes to the “Rationale for intervention”. I wonder how all these people came to be so readily brainwashed, but I have to read it. It says:
“Given the complexity of maintaining up-to-date registers there is a danger that trade union members, employers and the general public will not be confident that unions are complying with their duty to maintain an accurate and up-to-date register. And, as trade union activity has the potential to affect the daily lives of members and non-members, the general public should be confident that voting papers and other communications are reaching union members so that they have the opportunity to participate, even if they choose not to exercise it”.
It then goes on to the division between unions with more than 10,000 members and those below that figure.
As my noble friend Lord Monks pointed out, it says that,
“the Certification Officer will … be given powers enabling him to both act on his own authority to appoint inspectors and require documents to be produced to help investigations. The powers will provide a mechanism by which the general public and employers can ensure that trade unions are complying with their duty to maintain an accurate and up-to-date register”.
After all that, we come to the policy objective. I will read out one more passage. It says:
“The policy objective is to give greater assurance that unions comply with the existing duty to maintain a register of members’ names and addresses. However, we wish to do this in a way which minimises the burden on the union in providing this assurance and is not prescriptive … the intended effect of the policy is to ensure that members, the general public and employers are confident”,
et cetera. My reaction is, “You must be kidding”—but then it dawned on me what was going on here. There are two groups of civil servants being instructed by the Secretary of State to provide a case for this. One set of civil servants, job team A, is asked to write one set of arguments. In the next paragraph, job team B is asked to demonstrate the absurdity of the arguments presented by job team A.
Having cracked the code on this, I realised that it is all very logical—right down to the detail of why the sum involved is an extra burden on the trade unions of £420,000. That has been arrived at by using the salaries of trade union officials from the Annual Survey of Hours and Earnings, which says that the basic hourly median pay for officers of non-governmental organisations —that obviously implies voluntary organisations—who are the closest match to a trade union official, is £12.03 an hour. The basis of all this is that union officials doing all this stuff are paid that, on average, but I suppose that the people who have to provide all this stuff in Whitehall have telephones and might ring up any trade union to find out more directly.
I return to the main theme that many of my colleagues have brought out: why are we picking on the trade unions and making them keep their lists up to date for transparency, which we simply do not do for shareholders’ lists, boards of directors or banks? We are now insisting that we have to do even more for the most openly democratic and transparent organisations of any size in the country—the trade unions.
I will use a different word from that used by my noble friend Lord Whitty: I say that this is just party-political vindictiveness. I am very sad to hear that, because over many years of my working life we have had very good working relations with Conservative Governments, such as those of Mr Macmillan and Mr Heath. We had acceptance from them as social partners, and they would not have dreamt of this nonsense. I hope that in Committee we will have time to move away from the idea that a Secretary of State can say to Whitehall, “This is what we want to do; find reasons for it”. They have failed in that, because there are no good reasons—it is absurdity.
As my noble friend Lady Donaghy said, you do not need a lobby if you are chairman of a company in the energy field, whether it is a nuclear power station or anything else; you are probably president of the CBI and talk to the Prime Minister every day of the week anyway. To take another, more practical example: KPMG’s employees are scattered around Whitehall. Does it need a lobby? Of course not.
This is a quite extraordinary development, but I have reached the 10-minute limit so I will leave the issue there. As far as I can see, though, there has to be much deeper consideration by the Government. As things stand, my view is that the Bill should simply be withdrawn as an outrage to democracy. When I go to do work for the Westminster Foundation for Democracy in Congo or Mozambique, these are some of the practices that we state that you do not do—and we should not do them here.
Lord Hodgson of Astley Abbotts (Con)
My Lords, I begin with an apology to my noble friend on the Front Bench and to the House for having been unable to be present for the first few minutes of his opening speech. I hope that the House will forgive me if I pray in aid that it is not every day that you introduce your own wife to your Lordships’ House, and that the family photographs in the Robing Room took rather longer than was anticipated. I apologise for any discourtesy to the House.
I turn to the Bill. Like many other noble Lords who have spoken, I share the view that it is an unfortunate but undeniable fact that public trust in our great institutions, particularly our political institutions, has declined in recent years. We can speculate about the reasons for this. Some say that in some cases it is exaggerated by journalistic supposition and not always based on fact. Others say there is an increasing public appetite for conspiracy theories. Last but perhaps not least, there is the increasing unreadiness of people to accept the inevitable unfairnesses in life, seeing them instead as the product of a system that is biased against them. Whatever the causes, the decline is there, and this is the challenge that we now face.
Other noble Lords have used the phrase, “sunshine is the best disinfectant”, and I share that view. A Bill that includes “transparency of lobbying” has my instinctive sympathy and support. Moving on from that very general statement, and changing my metaphor, if I may, we have to ask whether it does what it says on the tin. This is an area where I and a lot of other noble Lords have some questions.
When I have been considering the Bill, I have been applying a series of yardsticks by which I adjudge its efficacy: its comprehensiveness, its comprehensibility, its consistency and its proportionality. First, by “comprehensiveness” I mean: do the provisions of the Bill catch a sufficiency of the target group? If not, we all know how quickly organisations can and will reconfigure themselves to get around statutory provisions. Secondly, the Bill will sweep up a range of organisations hitherto unaffected. By “comprehensibility”, I mean: will such organisations, especially small ones, be able readily to understand what is required of them without devoting a fantastic amount of management time and/or professional fees and advice to their interpretation? Thirdly, a number of bodies will be concerned with enforcing this legislation. They include, obviously, the new registrar of lobbyists, the Electoral Commission and the Charity Commission. By “consistency”, I mean: will all the policies of the bodies be joined up? In other words, will they be consistent one with another? Fourthly, by “proportionate”, I mean: can we avoid the creation of yet another huge bureaucratic process-driven machine, so that while boxes are ticked judgment is forgotten?
I need to remind the House that I have undertaken two inquiries into the charity and voluntary sector for the Government, focusing, inter alia, on the regulatory burdens that have affected that sector, and that until about 12 months ago I was president of the NCVO, so it will not surprise your Lordships that most of my comments are focused on Part 2. Before I turn to that part, however, I would like to raise a couple of points in relation to Part 1. I note many of the concerns that other noble Lords have raised about the competence of this measure and its inability to catch a sufficiency of the target population, and no doubt we shall explore this in Committee.
I want to raise a point about the position of the registrar. The registrar will surely have an important, indeed key, role to play in this new system. From the legislation it seems to me that he will be its linchpin, and it will be very important that he carries out his task properly if we are to move towards restoring public trust. This may require him from time to time to take actions that are disobliging, certainly to lobbyists but sometimes to the Government of the day, of whatever colour it may be. Indeed, some may argue that if he was not occasionally disobliging, he probably would not be doing his job very well. Yet when you look at Schedule 2, you see that his position is very weak indeed: he may be dismissed by the Minister on the grounds that he is unable, unwilling or unfit. That seems to be a pretty peremptory way to be able to treat this official, particularly when you compare it with the protection that appears to be given to members of the Charity Commission, let alone that afforded to members of the Electoral Commission. I would appreciate a few comments from the Minister on that point.
I turn to Part 2. Early in the proceedings on the Bill in another place, we received some pretty heated comments from charities and voluntary organisations about the impact of Part 2, suggesting, sometimes in terms, that it represents the end of the world as we know it. This is some of the substance that illuminated the background remarks by my noble friend Lord Tyler. Recent comments seem to have been more moderate in tone, and I welcome that because in my view merely to have passed a public benefit test does not excuse an organisation from the need for some level of scrutiny—rather the reverse, since charitable status carries with it many privileges, not least an element of subsidy from the taxpayer through gift aid.
I, for the reason mentioned above—my work with the sector—am a passionate supporter of the charity sector and all that it stands for. However, it needs to keep its credentials burnished bright, particularly in the eyes of the general public. Its reputation remains high among the general public, but we are all aware of how quickly reputations can be lost and of how, once lost, they are extremely hard to recover. The glory of the sector is that it is of all political parties but of none. That must be a distinction that we should try to preserve as we consider the provisions of the Bill.
Having said that, the sector has some very reasonable concerns about aspects of Part 2. Many noble Lords have talked about the confusing nature of Clause 26 on controlled expenditure. Noble Lords raised the particular issue that the cost of volunteer time is included. My noble friend Lord Phillips got up and said that he would shoot this canard; I am not quite sure if you can shoot one, but he dealt with it very effectively by quoting from the PPER Act. I hope that he is right. He is a very eminent charity lawyer, while I am not a lawyer at all. However, reading Schedule 3 to the Bill, which amends qualifying expenses, in connection with that section of the briefing from the Electoral Commission which is entitled:
“What the changes mean for campaigners’ plans”,
I feel a scintilla of doubt. I will be delighted to be put right and to be told that I have got it completely wrong, but I seem to feel the ground shifting under me slightly. Therefore, this and other questions raise the issue of the comprehensibility test. We need to spend quite a bit of time in Committee getting the Government to explain in detail the practical implications of what is intended here.
When he comes to wind up, my noble friend may be inclined to say that a great deal of guidance is already available. Of course, that is absolutely for sure. CC9, which I believe the noble Lord, Lord Ramsbotham, referred to, which is the Charity Commission guidance, Charities, Elections and Referendums, runs to 35 pages, with a three-page addendum published in January 2011. The Electoral Commission’s guidance for non-party campaigners runs to eight pages, with a further eight-page addendum. To put it no higher, there are four documents and if noble Lords read them—and I am sure that many noble Lords have done so—they are not easy to synthesise. At their heart is the problem of differentiating between policy work and campaigning, and the different interpretations put upon those two very important words by the two different bodies, the Electoral Commission and the Charity Commission.
That takes me to the point about consistency. We need to find some joined-up thinking between the Government’s lawyers, those of the Electoral Commission and those of the Charity Commission. Perhaps at least a proportion of the steam could be taken out of these issues if some joint guidance could be agreed between the two commissions and published. I do not underestimate the difficulties of getting the two commissions to collaborate—I have been trying for some three years to get Companies House and the Charity Commission to agree a common standard form for charitable companies. To describe my progress as “glacial” would be altogether too rapid a description. However, my noble friend would do a great deal to reassure people if those two bodies could be brought together and made to produce something that made sense and which did not require charities to produce two separate sets of guidance and pull them together.
Finally, I turn briefly to proportionality. I share the view that the reduction of limits is unreasonable, particularly that to £2,000. The £2,000 limit, applied to Wales, is a figure that would exclude almost any activity. The hire of a hall, some staff costs and publicity could go over the limit. In his very interesting remarks, the right reverend Prelate the Bishop of Derby talked about the importance of local campaigns. This is where that particular low level will be most keenly felt. I invite my noble friend to reflect on how we would deal with Kidderminster Hospital. That was a single issue, fought in a single constituency; how would it be dealt with under these provisions, and what would be the impact? I am not quite sure what it would be, but I am sure that it would have some important things, and maybe some challenges, for the people of Kidderminster, who passionately want their hospital preserved, and that these regulations might make that much more difficult.
There is some important work to be done on coalitions of charities working together and the way that they have to report separately. It is incredibly bureaucratic and burdensome for every charity member of a coalition to have to report about all the other members of that coalition, not only every quarter but every week during an election campaign. Can we not find some way to create a coalition leader that could undertake this work on its behalf?
I have overrun my time. To conclude, I do not doubt that there are important issues and challenges here, and the Bill seeks to address them. However, we will have a lot of work to do in Committee and thereafter if we are to avoid the rather dismal outcome predicted in that leader in the Financial Times on 9 September, entitled:
“A rushed bill will deliver bad law”.
Baroness Lister of Burtersett (Lab)
My Lords, like many other noble Lords I have an interest in the Bill through my involvement with a number of organisations that stand to be affected by Part 2. Moreover, I spent the first half of my working life working for the Child Poverty Action Group and am therefore very sympathetic to the concerns raised by myriad voluntary sector organisations. Part 2 is the focus of the report of the Joint Committee on Human Rights, of which I am a member, and its report lists my relevant interest. It will also be the main focus of my comments. I will first make some general remarks about process and the overarching aim of enhancing transparency.
The Political and Constitutional Reform Committee states bluntly that,
“this is an object lesson in how not to produce legislation”,
as it is informed by neither proper consultation with stakeholders nor pre-legislative scrutiny. The JCHR has protested at the,
“unnecessary speed at which the Bill is being taken”,
when there are no grounds for it being treated as emergency or fast-track legislation, as my noble friend Lady Kennedy of The Shaws has already underlined. This has impeded the committee’s ability to fulfil its scrutiny function in a timely manner, an unacceptable trend about which we had already complained in our Legislative Scrutiny Update report earlier this year.
Proper human rights scrutiny is not some optional extra to be fitted in when it suits the Government’s timetable. Indeed, as the committee points out:
“Laws that are passed following proper pre-legislative scrutiny, and after adequate timetabling for scrutiny and debate of the human rights implications of the Bills, are more likely to withstand subsequent judicial scrutiny of their human rights compatibility”.
This is particularly important with regard to the Bill because of its significance for the democratic process. The Government’s human rights memorandum to the committee accepts that Part 2 of the Bill engages the rights to freedom of expression and assembly. It acknowledges under Article 10 of the European Convention on Human Rights, that,
“political expression attracts the highest level of protection because freedom of political debate is at the heart of the creation and development of a democratic society”.
It also accepts the link with Article 11, for, as the Strasbourg court has said,
“The protection of opinions and the freedom to express them is one of the objectives of the freedom of assembly and association as enshrined in Article 11”.
We therefore now have a particular duty in this House to impress on the Government the importance of getting the Bill right.
The watchword of the Bill is “transparency”, and the overarching aim of increasing transparency in the democratic process is admirable. However, organisations which have campaigned for a statutory register argue that Part 1 of the Bill risks making lobbying less—not more—transparent. That is because it will cover only a fraction of lobbying and lobbyists and because the register will include no meaningful information on the activities of those it covers. That is about as transparent as mud. The dictionary definition of “transparent” is not just,
“able to be seen through”,
but also,
“easily detected, understood; obvious, evident”—
the very opposite of how the charitable and voluntary sector perceives Part 2. Instead, “uncertainty” and “ambiguity” are the words used to describe it. The noble Baroness, Lady Hanham, made a similar point.
The NCVO goes so far as to warn of,
“unbearable amounts of uncertainty for organisations”.
Indeed, I, too, have had an e-mail from Newcastle CVS expressing just such anxieties about what the Bill will mean for it and the local charities which it supports. As a number of organisations have warned, this uncertainty will have a “chilling effect” on legitimate campaigning at both national and constituency level at the expense of healthy democratic engagement.
Moreover, organisations such as the Association of Chief Executives of Voluntary Organisations—ACEVO—and the Quakers are fearful that small civil society groups will not be able to comply with the increased reporting requirements, which the Electoral Commission warns constitute an increase in,
“the regulatory burden for registered campaigners”.
As a result, they could be discouraged from democratic involvement in the pre-election period. Is it not odd that a Government who are so obsessed with reducing red tape for small businesses are now happy to tie up small civil society groups in red tape, as my noble friend Lady Hayter has already pointed out?
In so far as the government amendments to the Bill addressed these concerns, they are welcome. However, the widespread view conveyed to us, and based on legal advice, is that they do not go far enough. The NCVO and ACEVO both refer to problems with the existing test of controlled expenditure. These, it would appear, were manageable for many organisations within the context of the other rules that have applied, although even then, according to ACEVO, many smaller and less experienced campaigning organisations,
“were put off from pre-election campaigning activity”.
However, in the new context of the significantly expanded list of activities covered and lower spending thresholds, simply reverting to the test in the Political Parties, Elections and Referendums Act 2000 may not be enough to remove the feared chilling effect of the Bill. The JCHR has called on the Government to consider these concerns about how the existing definition will interact with key changes in the Bill. I would welcome the Minister’s response to this point.
As the Electoral Commission has advised, it is the “cumulative impact” of Part 2 on non-party campaigners that we need to scrutinise closely. It has told the Government:
“Because the Bill brings some kinds of activity into the regime for the first time … the wording of the amendments needs further consideration and testing”.
The JCHR has pointed in particular to fears about the combined impact of the much expanded list of controlled activities, the reduction in maximum spending limits and lowered registration thresholds. Furthermore, it has criticised the failure of the Government to explain satisfactorily the rationale for the change in spending limits and registration thresholds. It therefore recommends that these should remain at their present level pending further detailed work on the appropriate level, echoing the Electoral Commission’s recommendation on registration thresholds.
Others have raised worries about new constituency-level spending limits, which will add to the regulatory burden on civil society groups, and about how the new provisions could aggravate the already inhibitory effect of the existing rules regulating groups working in coalitions. All these issues need close scrutiny.
When I worked at the CPAG, I recall that the pre-election period was a crucial time for us to try to get poverty on the political agenda. It is a time for holding up to scrutiny a Government’s record on a non-partisan basis. It is a time for trying to wring commitments out of political parties and their candidates with a view to influencing not the election result but the agenda of the incoming Government, whatever their political complexion. If this kind of important work is inhibited by this Bill for fear that it will be wrongly construed as,
“intended to promote or procure the electoral success of a party or candidate”,
in the context of more stringent financial rules, as civil society fears, our democracy will be the poorer for it.
Some may give the Government the benefit of the doubt and attribute this,
“dog’s breakfast of a Bill”,
as the chair of the PCRC has called it, to cock-up rather than conspiracy. Others believe that it is a conspiracy to gag campaigners. If the Government do not want to give credence to the conspiracy theorists, mentioned by the noble Lord, Lord Hodgson, it is time that they face up to the breadth of the opposition and think again. From a human rights perspective, the JCHR concludes that the deeply unsatisfactory legislative process makes it,
“difficult to assess whether the specific measures proposed in Part 2 constitute a necessary and proportionate means of achieving the Government’s aim in order to justify any interference with free speech rights”.
As already noted, our primary recommendation, therefore, is to pause the Bill's legislative process to allow more time for proper consultation. I hope that, even at this late stage, the Government will heed our advice and that of countless others. The rights to freedom of speech and association are too important for our democracy for them to steam ahead regardless.
Lord Greaves (LD)
My Lords, it is always a privilege to follow the noble Baroness, Lady Lister of Burtersett, and, indeed, it is today. I speak with slightly less enthusiasm for the Bill than my noble friend Lord Tyler. I agree entirely with the objectives of transparency of lobbying and of the prevention of big money distorting electoral politics. However, asserting that there are problems and dangers in these areas and that something must be done does not necessarily mean that the details of the proposals in the legislation are the way forward. In one respect at least, this is an awful Bill; it is badly written. I often judge new Bills by whether an intelligent person with an interest in the subject, picking it up and reading it, could understand what it is all about. I do not believe that anybody picking this up and reading it could do that. I look forward to my noble friend the Minister explaining lucidly and clearly in Committee the intricacies of Clauses 28 and 29, which seem to be a nightmare.
I declare that I have a lifetime interest in electoral law because I am a lifetime election agent. It is more than 40 years since I started running election campaigns, and I do not suppose that I have finished yet, so I know about election law—and this is election law. We have had a stream of lobbying, ironically, on the Bill from all sorts of people. It seems that the whole of civil society in this country is up in arms. In particular, we have had a focus on the effects that Part 2 might have on charities. However, this Bill is not actually about charities. It is about all the third-party campaigners and campaign bodies. Nevertheless, charities say it will seriously affect them.
The Government’s response is to assert that it will not, but assertion is not enough. When a whole sector is up in arms like that, simply telling it that it is wrong is not good enough. There should be argument and explanation and, I humbly suggest to my noble friends on the government Front Bench, a willingness to look at changing the Bill to clarify it, to amend it and to improve it, is what is required. At the moment we simply have a pantomime argument going on, one side saying, “Oh, yes, it does”, the other side saying, “Oh, no, it doesn’t”, and so it goes on—and as we know from pantomimes, that does not get us very far.
In your Lordships’ House we are often told that our job is to scrutinise, revise and improve legislation. In order to do that, we also need a substantial willingness on the part of the Government to listen and discuss with us around the House how best to revise this legislation—the need for which, it seems to me, is absolutely certain. As I have just said, this is election law, not charities law. What charities can and cannot do is not per se the concern of the Bill. That is defined by charities legislation and regulated by the Charity Commission, as the noble Lord, Lord Hodgson, discussed in detail. This Bill is about regulation of what all third-party bodies can and cannot do in relation to election campaigning.
One problem is that it is all part of election law, which is complex, obscure and widely ignored. Those of us who know a lot about it know how to get around it in many cases—not that I would ever do that. But the Bill specifically amends the Political Parties, Elections and Referendums Act 2000, or PPERA. Having gone back and read that part of the Act again in detail, for the first time in a long time, I think that it is poor legislation. I hope that the Labour Party will not get too much on its high horse about this Bill, because one of the real problems with it is that it is based on the structure and system set out in PPERA, which is frankly not fit for purpose. We are lumbered with it and have to do our best with it—but it will be legitimate in these circumstances to look in Committee not just at what the Bill says but at what PPERA says, to see whether a lot of the vagueness, obscurity and the problems in this area do not actually come from the original wording in that Act. We are told by the Government, or by my noble friend Lord Tyler, that over the past 13 years Part 6 of PPERA has been tried and tested—but it has not. It has largely been ignored; it has never been tested in the courts; and I think that we should subject some of that to scrutiny in Committee. It is complex and difficult to understand; it is full of vague expressions, when clarity is needed; it is untested in the courts; and it is subject to unsatisfactory advice by the Electoral Commission over the years. Those comments apply to PPERA, not just the Bill that we now have to amend it.
The whole thing is poor, flawed legislation. Whether we can make anything sensible out of it, we will find out in the next few weeks. This part of PPERA and these issues have really come to prominence only as a result of the present Bill—because the thresholds and spending limits are being reduced and what is defined as controlled expenditure is being substantially increased. That has put considerable fear among the campaigning organisations, whether or not they are charities, and that is what is causing the problems before us today. I suggest to the Labour Party that the Bill has reached Second Reading and, no doubt, it will pass Second Reading—although it is fair enough to make political points in this debate. But all of us—the Opposition, the Cross Benches and the two government parties, as well as anybody else in the House who is interested—need to get together and try to thrash out a way in which to make this legislation a great deal better than it is now.
I want to talk about constituency campaigning, which has a new emphasis in this Bill. It is a very difficult issue in relation to third-party campaigning, because it is within the confines of a particular electoral area, which is obviously considerably smaller than one of the nations of this country. It is considerably easier, if people have a lot of money, to throw money at a particular constituency and seriously affect the election result. This is a serious problem, and it is no good us pretending that it is not. Yet we live in a changing world, in which political and campaigning energies are more and more being directed into single-issue and themed campaigning groups. At the same time, coming from a different direction is the threat of a large amount of money and corporate power being used in this country; it is not necessarily exactly the same as the super-PACs that are so distorting politics in the United States of America, but the same kind of problem is occurring. It is not easy to find a way in which to regulate all this, and to fit that into the traditional system of controls and regulation that is based on political parties and candidates being regulated. These are difficult areas at national levels; they are most difficult at the level of individual electoral areas, constituencies or even local government wards.
In the past, the system was much stricter. When charities or local groups called all-party meetings and one candidate dropped out, they usually cancelled the meeting, because it was thought that spending money at all in a way that was in any way partisan was contrary to electoral law and should not take place. That is in the past now—but any of us who have been in politics for a long time have scars from individual contests when third-party campaigning has made a difference. We may not have the scars—we may have the victory medals as a result of it—but in our party we tend to have the scars.
I remember in the Nelson and Colne constituency in February 1974, nearly 40 years ago, there was a very tight contest in which David Waddington, now the noble Lord, Lord Waddington, was defending his seat; he held it by about 135 votes. The candidate who came second was Doug Hoyle, now the noble Lord, Lord Hoyle, and the Liberal candidate was myself. That election was considerably affected by two lots of third-party campaigners. There were people from the Society for the Protection of Unborn Children, who managed to divert a lot of Catholic votes away from both of us—certainly from me. The others were the local unions, who used their base in what was then a very strong manufacturing area, with all the local mills and the factories, to make sure that the main opposition to David Waddington was the Labour Party and not me. I am not complaining about it, in retrospect, although at the time I thought that it was pretty underhand. I have changed my mind about these things. I have been out on the streets delivering Hope Not Hate leaflets in Pendle against BNP candidates, and I have contributed funding to those leaflets. So there has to be a balance. Third-party campaigning cannot be done away with or forgotten about. It is here to stay. What we have to do is to get the balance right, and we can do that in Committee.
It is rightly said that this Bill has had a disgraceful lack of scrutiny, and I agree with that. But we are where we are; the Government are not going to withdraw it, and it is not going to stop. So the task before us is to test the Bill rigorously, line by line and clause by clause in Committee. We have to look at workability, which is crucial, as well as proportionality and unintended consequences, and one or two of the principles in it. If we can work together as a House and the Government can work with us, we can make a much better fist of this Bill than we have at the moment.
Baroness Mallalieu (Lab)
My Lords, I shall speak only on Part 2. I must first declare some non-pecuniary interests. I am a member of the Commission on Civil Society and Democratic Engagement, which was set up under the chairmanship of the noble and right reverend Lord, Lord Harries of Pentregarth, who spoke earlier. We will produce our report next Tuesday in time for the Committee stage of the Bill. I very much hope that all noble Lords will make a little time to have a look at it because during the past few weeks we have listened to a vast amount of evidence, including from the noble Lord, Lord Tyler, and we have taken, as it were, views from all parts of the United Kingdom.
What I am going to say tonight is a personal view because the report is not yet finalised. However, having listened to and read all the evidence, there have been times when my reaction was very much that of Victor Meldrew in “One Foot in the Grave”: that is, “I don’t believe it!”. How could a Government, any Government, make such a hash of an issue on which we are almost entirely united—that of transparency at election time? None of us wants money to be able to buy votes. We agree that there should be clear limits on spending and the public should be told who spends what. If anything, we should be looking tonight at a short Bill with all-party support, which makes some amendments to the Political Parties Act to improve its clarity. That would have all-party support. Instead, undue haste has produced a quite dreadful piece of legislation which has managed not only to divide the political parties but has united charities and organisations of every kind against it. How do you manage to alienate the Women’s Institute, Mumsnet, the National Trust, Greenpeace, the British Legion, the Countryside Alliance, the nurses, the RSPB and so on against you so that they combine together? You could not do it if you tried, but this coalition has managed it. When listening to the evidence, I did at times wonder whether someone with a sense of humour had slipped Part 2 into this Bill to test whether anyone in this House was awake, but the 40-strong speakers list shows that we are. If there are notably few Back-Bench coalition speakers, I can attribute it only to a number of those who normally stand up for free speech having adopted the maxim, “If you can’t say anything good, then say nothing at all”.
Part 2 is not wholly useless. It could serve a professor of politics very well as an example to his students of how not to legislate. It contains just about every error that a Government could make. There is not time tonight to detail them all, so I will take a selection of the major ones. The first thing you do is legislate in haste. Part 2 seems to have its origins in a meeting between the Prime Minister and his deputy in July, when they realised that unless something was done pretty quickly this autumn, a Bill would not reach the statute book a year before the fixed date of the next general election. There was no real urgency whatever about Part 2. We have been told by Members in the other place that Members of Parliament were not clamouring for it, and neither was anybody else.
Although the Political Parties, Elections and Referendums Act 2000 had its critics, and various improvements could have been made to it, it has worked reasonably well in two general elections. We were told that there has been no raft of complaints about it. There has been no formal investigation or inquiry and no prosecutions. It is not perfect: there is some lack of clarity and the Electoral Commission’s review has suggested improvements, but it is workable. Nevertheless, Part 2 was shoved into this Bill and, as we have heard, it was put before the Commons just as the House rose for the Summer Recess—indeed, the very day before.
The second error the Government made was not to consult those directly affected. They did not consult charities or campaigning organisations. Indeed, they did not consult properly those with responsibility for setting up and policing the new legislation. The Electoral Commission were, it seems, told what to do, not asked. Of the 50 recommendations it made in its review, only one was put into the Bill, and that was done in the opposite way to that which it had suggested. The Electoral Commission advised that staff costs should come into the equation, but suggested that if it were done, the limits should be raised. The Government have, indeed, included staff costs but are now trying to lower the limits.
Others have commented on the next error, which is particularly strange coming from a coalition which speaks of making “a bonfire of regulation”: that is, a massive increase in the regulatory burden and, by lowering the limits, an increase in the number of those to whom it applies. We should not forget that criminal sanctions will be applied, which are wholly disproportionate given the sums involved in many cases.
A further error is to try to push through a Bill which is so badly drafted that a specialist lawyer giving evidence to us told us that she could not conceive that it had ever been seen by a parliamentary draftsman. Lack of clarity and the sheer incomprehensibility of its wording mean that any organisation without an in-house specialist will have to seek expensive legal advice simply to understand what it means. The noble Lord, Lord Greaves, referred to that issue. I treat your Lordships to a few lines by way of a sample. Clause 28 on constituency limits at page 17, line 5 of the Bill, says:
“Subject to sub-paragraphs (5) to (7), the limit applying to controlled expenditure which is incurred by or on behalf of the recognised third party in the relevant period in any particular parliamentary constituency is the relevant proportion of the limit mentioned in paragraph 3(2A) … For this purpose “the relevant proportion” means— A/B where— A is the number of days in the relevant period; B is the number of days in the period which is the relevant period for the purposes of paragraph 3”.
How is somebody sitting in a small charity to make head or tail of that? The result, of course, is that they will be frightened off—they will be terrified of doing anything that puts them over the limit—
Lord Phillips of Sudbury
Does the noble Baroness not realise as a lawyer that this is a goldmine for lawyers?
Baroness Mallalieu
That is the other possibility, which I had not considered. It will undoubtedly increase the work of people who advise charities, such as the noble Lord.
Where are we on the rest of the so called clarification brought about by the amendment to Clause 26 in the Commons? I am the president of the Countryside Alliance. We have no idea what we might or might not be able to do as the Bill is currently worded. At the previous election we produced a rural manifesto that outlined our policies. It was widely distributed and not aimed at a particular party. We are told by the Electoral Commission we could not do that. It is clear that we could not organise a march, but could we organise hustings or have pledge cards? What of all the other public events where campaigning organisations put forward their views and express their wishes to their elected representatives? Who can tell? It is not only badly drafted; it is not readily understandable by those who need to know.
Yet another error was mentioned by the noble Lord, Lord Rooker—putting forward legislation which is bound to increase the number of complaints made to the Electoral Commission during an election period but providing no extra resources to enable the commission to investigate or deal with them. The Electoral Commission has had something to say on that and has asked the question and, as far as I am aware, has not received a satisfactory answer.
I could go on but I will not. I will just turn to the Government’s biggest mistake of all, one which the right reverend Prelate the Bishop of Derby mentioned. At a time when there is a deep mistrust of politics and political party membership is falling, trying to scare off the political involvement of the public who in their millions—literally in the case of some charities such as the National Trust and the RSPB—have turned to supporting extra-parliamentary campaigns is an affront to democracy. The voluntary sector’s involvement in public debate is to be encouraged, not stifled. It informs MPs and candidates. It informs the electorate. It enriches debate and very often, and perhaps most importantly of all, it provides a voice for groups that are otherwise powerless. Campaigns can at times, I have no doubt, be irksome to Governments but they are positive for democracy. Freedom of expression should be protected, not gagged.
This is a bad Bill, which I suspect in its present form is incapable of being corrected properly by amendment. We are, of course, giving it a Second Reading tonight. It misses the point. It is a wasted opportunity. It does not even begin to deal with modern ways of campaigning such as Facebook and Twitter, because nobody has consulted the people using those tools now. The Government, or whoever drafted this Bill, have not taken them into account. In common with others who have already asked for it, I hope very much that the Government will see the sense of taking this Bill away, consulting and then returning with a Bill which we could all support. After all, that is the way in which constitutional changes should properly be made. If they do not do so, I hope that Peers from all parts of this House will raise their voices and, if necessary, walk through the Division Lobby to make sure it happens.
Lord Adebowale (CB)
My Lords, to be honest I was going to go home, because I am number 30 on the list and I have listened to all the speeches—well, most of them. I was going to stand up and declare my interest as the chief executive of a charity and a social enterprise and the chair of another charity, as well as my membership of many others, and then speak in favour of the Bill to provide some light relief.
I think that what is at stake is really quite serious. I have been involved in the not-for-profit sector, lobbying, for about 30 years and I struggle to understand what the Bill is about. In those 30 years, I have yet to come across a member of the not-for-profit sector who would breach the intent even of this Bill. I would be fascinated to know examples of where that has occurred other than the one referred to by the noble Lord, Lord Rooker, who pointed out that there was a picture of a fellow charity chief executive in the Conservative Party manifesto. So there is a real problem with justifying what the Bill is about.
Part 1 has been referred to as being about transparency. There is an over-hackneyed phrase about sunlight being the best disinfectant. That may be true, but partial light creates shadows, and Part 1 creates too many of them. We all know that if you want to get around this you create in-house lobbies. The fact is that Permanent Secretaries and Ministers can list their meetings—we know how it works. The one thing that I find really quite disturbing and which makes me angry is having my time wasted and seeing people being treated as though they are not intelligent enough to know that. Then I sit here and listen to the speeches, many of which have been absolutely brilliant. The noble Lord, Lord Rooker, just about said it all when he mentioned the £3 million versus £30 million. I would love to have the kind of money that I see in the hands of many of the major companies that march through this House lobbying Ministers and civil servants. It is nonsense to argue that we are somehow at risk of tipping up democracy.
More to the point, let us have a look at social history. Do noble Lords really think that the suffragettes, the people who campaigned against slavery or, for that matter, the Tolpuddle Martyrs would have asked themselves, “How much can we spend in Wakefield on lobbying our local Lord”, who then was the only person with the right to vote, “to try to persuade him”—and it was a him—“to take notice of the interests of the poor and the disenfranchised?”. Let us be real. It never happened and it should not happen now. It is ridiculous. Social change occurs because of people outside these Chambers taking up concerns that we do not yet know of and lobbying people such as us and those in the other place precisely when the local and national elections are in the minds of the public and the lobbyists. And so they should. Why? Because they pay for it all.
The noble Lord, Lord Greaves, gave an example of local interests. It must have been a terrible experience but I sat here and thought, “Tough”. That is democracy; that is how it works. People either are or are not persuaded and, frankly, the amount of money spent by people who wish to persuade candidates in a local area is neither here nor there. I can tell noble Lords that people in middle-class areas do not spend a penny, but they use their elbows and persuade people, and they change what happens in local elections. I knew that the noble Lord would want to say something, so I shall sit down.
Lord Greaves
It was not a terrible experience at all; it was all part of the fun of local politics and local campaigning.
Lord Adebowale
Spoken like a true democrat.
The point is that the Bill is confusing. People cannot see the point of it. The NCVO, the Countryside Alliance and the National Trust are not organisations prone to hysterical statements about government policy; they are considered organisations that think very carefully about what they are going to say in support or in critique of government policy, and not one of them is for the Bill—not one. My e-mail account is full of people saying that this is wrong. It sends the wrong signal about how we value the opinions of people who do not have the privileges that we have to pontificate about the nature of democracy. It insults those people who gather, with or without money, to influence the people whom they put in the other place and who are paid to sit here. It does not create an understanding of how public policy works and how social change should happen in a civilised country and it does not shed enough light on the true nature of lobbying in this country. That is the truth of it.
Frankly, I think that we should start again. I do not think that it is so much a case of a pause or a chilling effect; it will be a freeze, let us make no mistake about that. There will be people who will be frightened by the contents of the Bill. We may well joke about the cost of lawyers. I happen to run an organisation that employs 3,000 people—some people would call us large and well resourced. I tell you now, with all due respect to noble Lords, that lawyers frighten me, not just because they are expensive, but because they do not always bring clarity. You think twice about whether you are going to campaign when you are faced with the complexity of Part 2. Part 1 will, frankly, provide plenty of loopholes—as has been pointed out by a number of noble Lords—and therefore an industry in advice to industry. We know that.
I do not want to hold up the House any further, other than to say this. My concern is not whether charities or not-for-profit organisations are held back; they have more organisation than the people I am really concerned about. I am not that concerned, even, about whether the Bill will impact on the industry of lobbyists. They will find a way around it—certainly as the Bill is drafted, they will have a field day. My concerns are for the people who do not have access and do not understand how this place or the other place works but who have concerns about how their community and how society work, who want to make a difference and who deserve to be heard. Those are my concerns and they should be the concerns of this House, the Government and society.
Lord Phillips of Sudbury
My Lords, I declare an interest as a charity lawyer of long standing and founder of the firm Bates Wells and Braithwaite, which does as much charity work as any firm in the country.
I hope that the Minister will not be too dismayed by what I have to say. I do not view this as a partisan Bill; it is a Bill that all sides should, classically, deal with as they best think fit, as they are doing. However, the problem of dealing with this as Back-Bench Peers is as intense in relation to this Bill, more or less, as to any that I have come across. It is not so much the length—it is a mere 62 pages—but that it is mostly written by reference to the 2000 Act, and there is no Keeling schedule. How on earth are we Back-Benchers, with no assistance whatever, supposed to get to grips with the fine print of a main Bill of 201 pages and a supplementary and amending Bill of 62 pages? It is outrageous: I wanted to say that. I hope that in Committee the Minister will put in hand a Keeling schedule right away because without it we cannot do our job.
I note also that as we got in this morning there were three documents, totalling another 94 pages. One was the excellent Library note, one was the report of the Joint Committee on Human Rights and the third was the Constitution Committee’s report. They were available only this morning. Again, how on earth are we supposed to do our jobs and take into full account the very careful work done by those various bodies? That merely emphasises the fact that a Bill of this importance should not be dealt with in this helter-skelter way, whether or not it comes out of the wash in time for the 2015 election. In my view, that is of secondary importance to the need to get this Bill as right as we can. It is difficult enough if we do that in the right way.
I happen to agree with much of what has been said in criticism of Part 1, although I want to concentrate on Part 2. I do not want to see Part 2 wholly scrapped, because with regard to non-charitable entities—particularly commercial third parties seeking to influence the outcome of an election by plugging, sometimes with huge resources, a particular line or point of view—we need Part 2 although, again, it should be heavily amended. I am wholly unpersuaded that we need charities in Part 2 at all. They should be exempt from Part 2 and from the 2000 Act. I shall come to that in a little detail in a minute.
A number of Peers have mentioned the importance of the charity sector, but there are one-third of a million charities in this country, 95% of which are run entirely by volunteers. It is no good the Minister saying, “They will not be caught by this Act”. Lots and lots of them jolly well will because we have the provision about coalitions. I am damned if I fully understand the coalition arrangements, but certainly they will catch tens of thousands of small charities in their tentacles because so many of them are part of a national body, albeit that they are independently and separately registered as charities, and we know all the rest.
There has been a good deal of exaggeration and quite a lot of charities, frankly, were not even aware of the 2000 Act where a lot of this stuff resides. None the less, the charity sector as a whole is up in arms about this Bill. Broadly, the charities are absolutely right. The noble Baroness, Lady Hayter, used the rather nice expression that this is a solution without a problem, which is right. We have no evidence from anywhere or anyone that the last election or the one before was subverted by charities. When have we ever in this House had a Bill like this which deals with a problem that does not exist? It is bonkers. It is not even as if, if we take charities out of this Bill, there is nothing that contains and controls them: they have the Charity Commission, as my noble friend Lord Hodgson and others have said.
The Charity Commission is not a pushover. I have grappled with it for the past 45 years. Sometimes, it is pretty tough going. It has a job to do.
Lord Judd
Very few people know more about charities and their activities than the noble Lord, but is he not being a little naive? Even if he can sustain his argument that there is no evidence from previous elections, is not the point that there could be—for example, in Sheffield—in the next?
Lord Phillips of Sudbury
My Lords, I think that the Charity Commission can do the job. Perhaps I may read a couple of passages from CC9, which was mentioned by my noble friend Lord Ramsbotham and others. It is a long and detailed guidance for charities which has evolved over 40 or 50 years. I have been quite closely involved with it. It gives an absolutely well thought through, pragmatically based series of yardsticks. The summary of campaigning and political activity by charities states that,
“political campaigning, or political activity, as defined in this guidance, must be undertaken by a charity only in the context of supporting the delivery of its charitable purposes”.
There is no equivocation. It can engage only in activities pursuing its “charitable purposes”. It continues:
“However, a charity cannot exist for a political purpose, which is any purpose directed at furthering the interests of any political party, or securing or opposing a change in the law, policy or decisions either in this country or abroad. In the political arena, a charity must stress its independence and ensure that any involvement it has with political parties is balanced. A charity must not give support or funding to a political party, nor to a candidate or politician”.
That is as clear as clear can be. They are not empty words, and there are a lot more to go with them. The Charity Commission enforces this, and the charity world is remarkably free of any abuse of these guidelines.
The noble Lord, Lord Judd, may remember that when he was director of Oxfam we had a major battle with a statutory inquiry instigated by the Charity Commission into Oxfam having had activities outside the range of what was permissible under charity law. Fortunately we ended up convincing it that we had not, but these are not empty words. If the Minister says that they are not quite strong enough then give the Charity Commission more resources. It has had a great deal of its people power taken from it. If we remove it from this Act, it would be a big load off the back of the Electoral Commission. It would be a saving of manpower, not a waste of manpower. It would be an economic measure to give the Charity Commission a little more assistance and not to put the burden on the Electoral Commission.
Others have said it, but the charity world as it is is the jewel in the crown of our culture. More than half the adult population is engaged in charity in one way or another. Charities are the engine of civic engagement at a time when in other respects we are in dead trouble. They exemplify organic life, volunteerism, communalism, philanthropy and trust. They are cherished. Can we claim those characteristics for the body politic? I fear not. Can big business claim any of those virtues? I fear not. Yet we are on the brink of putting into force an Act which will damage the sector, particularly the smaller part of it. It will demoralise charities, it will cause bureaucratic overload and it will waste money that is hard obtained and can be used better elsewhere. I do not see that we have anything remotely approaching a justification for shackling the charity sector in the way we are when there is no proven evidence of abuse and when the Charity Commission is there to do a job which it is already doing.
I have probably said more than enough, but I hope that when we get to Committee I will not have to put down 100 amendments because it would be a waste of time compared to a much more fundamental review. My last word is to remind the Minister that charity law is severe. A charity can exist for charitable purposes only. It can act only to pursue those charitable purposes. It can act only in the public benefit. We do not need this.
Lord Judd (Lab)
My Lords, I begin by declaring my interests. I have worked both as an executive and as a volunteer in a number of charity and voluntary agencies. I was director of VSO, director of Oxfam and more recently I am a trustee of Saferworld. My activities have mainly been in the international realm but also very much nowadays in the environment role as well.
I think that we are in a grave situation tonight. My noble friend in winding up what I thought was a very good opening speech, promised that we would work constructively and hard to try and make this a better Bill. I hope that that is possible; I have some doubts. The Government will have to do a lot of work to persuade us that we can make this a better Bill because there is tonight’s well argued issue about the complete incompetence and failure to think through and to analyse the consequences, and the unintended consequences, and how they will be dealt with. There is also a question about the underlying purpose of the Bill. At best that could be crudely party political and at worst it could be quite sinister. I have done a lot of work in the North Caucasus region and Russia in recent years and I am horrified to be looking at what is being proposed here and seeing how it relates to what is happening to civil society in Russia.
At times like this it is important to go back to the grassroots and listen, and I am going to ask the House to bear with me while I do that. In all the plethora of representations that have been made to us, there is one that has registered strongly with me. It is from the Newcastle Council for Voluntary Service, and other noble Lords may have seen it. I shall quote from what the council says:
“It isn’t clear which elements of our work could be classified as campaigning. For instance, we are involved in research on the impact of welfare reforms. Is that campaigning? We regard campaigning as one of our legitimate efforts, as our focus is about using voluntary and community action to improve the lives of people in Newcastle. It would be impossible to designate/attribute an economic value to this element of our work. There would be potentially disproportionate amounts of administration involved. The Act would effectively be a deterrent as there could be confusion over what was classified as campaigning. Obviously we are bound by Charity Law and do not engage in party political campaigning, but we have signed up to campaigns previously which want to change or strengthen policy during election time, eg support for housing homeless people”.
At this point I want to make my own intervention and say that I really do not understand this nonsense about the election period. If there is a valid role for voluntary agencies and charities in informing the public, it can be particularly important in an election year. The parties have to take into account the realities that are being beamed at them from the voluntary sector. I shall continue the quote:
“(Shelter Campaign) or addressing Child Poverty (Child Poverty Action Group) and general anti-poverty work”,
are all among the council’s concerns. It goes on by saying:
“It is sometimes difficult to attribute exact staff costs to different workstreams. Would we be deterred from joining in partnerships and working in collaboration with others as it wouldn’t be clear if a joint piece of work was subject to the new Act and we could be unintentionally drawn into this? As part of our general work, we try to engage in public policy discussions, this could inhibit us from doing so in future. For instance, we promoted the hustings sessions around the election of the Police and Crime Commissioners locally; in particular the sessions aimed at the voluntary sector. Would this count as campaigning under the Act in the future? … currently we are involved in the Living Wage Campaign; the Who Benefits campaign; doing studies on the impact of government policy on our members ie other local charities; working with disability charities looking at how to minimise the impact of welfare reforms on their users; doing studies on local organisations to improve the case for funding voluntary and community organisations. All these pieces of work fall well within our charitable objectives. All of these could fall subject to the Act”.
I see the noble Lord, Lord Tyler, shaking his head. The noble Lord and others have to face reality. Whatever was intended, the perception is that this is going to happen, so to rush this Bill through without having had any consultation with the organisations concerned is a political and constitutional disgrace. What these remarks indicate is how important it is to consult, so that you have the good will and involvement of the people who are doing the work at the front line; not pontificating in this House, but actually doing the work at the front line. I am absolutely dismayed that this Bill is before us without consultation, but I am not surprised. It is all too characteristic of the arrogance which is around: “We know and we can do it”. I am afraid that for a sane, decent, modern society, we must have a government approach which says, “Here is a problem that deeply affects people. Here are real issues of proper accountability during elections and the duties and responsibilities of trustees”. How can we sit down together and find a solution that we are all happy with and which we see as constructive? That is the mature and self-confident thing to do, not this lack of self-confidence which means that things have to be driven through rather than gathering up and involving people in a solution that is wholesome and rooted in our society.
This issue of campaigning and charities is not new. I was director of Oxfam and I wonder how many people remember where Oxfam started. It started in the university church in Oxford in 1942. There was the threat of invasion, with everyone geared up to defeat the enemy. I was a youngster at the time and I can remember the signs and slogans for victory. There was a great atmosphere. A cross-section of society came together: academics—Gilbert Murray among them—trade union leaders and church leaders. They were deeply disturbed about the appalling famine which they knew was happening in Greece. They went to the Government and said, “We want to get relief to Greece”. The Government said, in effect, “You must be mad. Greece is occupied by the Germans. How can you talk about doing that in this context?”. They said, “It’s not the Germans we’re concerned about, it’s the Greek people”. The Government said, “Look, there’s a blockade of Greece. How can we break a blockade to get assistance through?”. So in 1942 they went out with a petition and gathered thousands of signatures in Oxford and beyond. They got the public’s support and went back to the Government and said, “We want to do something about these people in Greece”. The Government caved in and said, “Well, if you can organise something with the Red Cross and you do it through the Red Cross, we will let you do it”. How would that have happened if there had not been a determination—a conviction—to drive through the objectives which they thought were there in the organisation they were forming and to take whatever action was necessary to garner public support for what they were doing?
More recently, when I was director of Oxfam, I went on a visit to Latin America in the bad and ugly years—sinister and horrible years in many ways with the things that were happening. I was meeting our own people and the brave partner agencies with which we were working. I ended up in San Cristobal in Mexico. I met the brave Roman Catholic bishop of San Cristobal. He was a tough guy. Open-necked shirt, wooden crucifix, but my God, he was a strong man. He was frequently in conflict with the Government of Mexico because he was standing by the Indians in their terrible predicament in Chiapas. He was being threatened physically and verbally all the time.
We got into a very good conversation. I asked him whether he had a message he wanted me to take back to Oxfam and to the British people and he said that he had. He said, “You talk of your partners here. You talk to people here. You talk about them. How often do you talk with them and speak for them? I believe that solidarity is the real meaning of charity. You cannot be neutral. You have to stand up and be counted. You have to tell it as it is”.
That is an historic, inescapable duty and responsibility for those of us doing serious charitable work. Otherwise we are caught up in a conspiracy in which we are satisfied with treating symptoms; in doing so perhaps masking what is really wrong and failing to speak out on the underlying issues that arise out of our work. Of course, any charity and any voluntary agency campaigning must ensure that what it is saying is rooted in its own experience. That is not only right in principle but it brings strength to their campaigning because it brings the strength of experience.
If, intentionally or not, we are doing anything that is quenching the spirit of charities at their best—because advocacy can become the best way to serve the poor—we are doing the country a very serious disservice.
Lord Jay of Ewelme (CB)
My Lords, I follow the noble Lord, Lord Judd, with as much trepidation as I did some 40 years ago when as a young civil servant I followed him round some rather poor parts of west Africa on a ministerial swing, a trip that I suspect may have influenced both him and me in spending a good part of the rest of our lives in dealing with development issues.
I would like briefly to comment on Parts 1 and 2 of the Bill, and on procedure. On Part 1, first, I echo what some others have said this evening: lobbying, whether by NGOs, churches or companies, can be a valuable, necessary and, indeed, inevitable part of our democracy. In my own experience, much legislation and some policies with which I have been involved have been brought forward without consultation and as a result have been flawed. I have to say that Part 2 of this Bill is rather a good example of that.
However, such lobbying must be open and transparent and must be made public. I am not talking about just lobbying by consultant lobbyists. Like others, I am puzzled by the Bill’s exclusive focus on consultant lobbyists. The coverage surely needs to be wider than that. I am also puzzled by the exclusive focus on Permanent Secretaries and Ministers. I have a certain respect for both Permanent Secretaries and Ministers but I am not naive and the focus surely needs to be much wider than that, and include political advisers, directors-general, directors and, for example, anyone in a team working on a new Bill who might be instructed to report any approaches from lobbyists to their director or director-general. The important thing is that this is done.
Baroness Williams of Crosby (LD)
I apologise for interrupting the noble Lord but does he agree that the Permanent Secretary is probably almost the last civil servant to be lobbied in a controversial situation?
Lord Jay of Ewelme
I entirely agree. Indeed, any lobbyist worth his or her salt is going to make quite certain that they lobby somebody slightly lower down the scale, and by the time the piece of legislation or the policy gets to the Permanent Secretary or the Minister, the damage may well have been done. I entirely agree with the noble Baroness.
In this context, I particularly liked the idea of the noble Lord, Lord Norton—if I have understood him rightly—of shifting the focus in this part of the Bill from the lobbyist to the person being lobbied, with some mechanism to ensure that that lobbying is made public when the Bill or the policy is made public. That seems a rather simpler approach than that in the Bill at the moment. I look forward to the Minister’s comments on that and I hope that that idea can be considered further.
On Part 3 of the Bill, if the aim is to catch the transatlantic political sharks of the noble and right reverend Lord, Lord Harries, as they approach our shores, as seems to be the case, we must find some way of ensuring that our NGOs do not get caught in that net. I recognise that the Government have tried to reflect some of the concerns that NGOs have expressed but, as our e-mail inboxes have shown in the past few days, they have not succeeded. To leave open the possibility that NGOs decide not to continue their activity in a full year before an election or have to spend on complying with new bureaucracy time and money which donors rightly expect should be going to the front line—to the poor, the sick, the elderly and the homeless—is quite simply wrong and contrary to some basic constitutional principles of freedom of expression and freedom of speech.
On procedure, I much regret that the Bill was not subject to pre-legislative scrutiny. A Bill with clear constitutional—indeed, electoral—implications is just the sort of Bill that deserves and requires full and proper pre-legislative scrutiny. It is perhaps too late for that to happen now, but I ask the Minister to think seriously about ensuring that Part 2, at least, even at this late stage, gets the kind of proper consultation with those whom it may seriously affect that it so badly needs. That would surely be time well spent.
Baroness Smith of Basildon (Lab)
My Lords, this is the Bill that the Government told us would restore faith in politics, regulate and tackle abuses in lobbying and enhance our democratic processes. As we have heard so often in the debate today, it fails on all counts.
I am the last to speak in this debate before the wind-up speeches, so I am conscious of the old saying that everything has been said, but not yet by everybody. I hope that I can say something that will contribute to the debate, even with all the excellent speeches that we have heard this evening.
My last role in the Labour Government was as a Cabinet Office Minister with responsibility for these issues. I am clear that most lobbying involves citizens and organisations engaging in the democratic decision-making process of society; that should be encouraged rather than constrained. From the discussion I had with the lobbying industry in 2010, we were clear that all lobbying must be conducted appropriately; it must be open, transparent and accessible to all; and that either the industry took meaningful steps to regulate itself or the Government would do so.
Despite welcome progress, my view remained that the industry had not got far enough and that more significant changes would have to be introduced by government. Instead, we have in the Bill a backward step from the lobbying industry’s voluntary register. The Government proposals hinder and fetter the good and do little to regulate what could be bad. Are the public really crying out for changes to hinder or stop charities and campaign organisations from making their case and lobbying for their causes, or are the public deeply concerned about the access to government of large corporations and lobbying companies which do not even declare their clients?
The Bill does absolutely nothing to ensure greater transparency in the latter’s relationship with government. Despite great promises, there are so many exemptions in Schedule 1 that just a tiny minority of the huge lobbying industry will be included. Even for those few who are captured, there is no code of conduct for behaviour, no sanctions and no requirement to declare clients. The Government even failed to acknowledge that lobbying is a wider activity than lobbying just Ministers. What about special advisers? What about civil servants other than Permanent Secretaries? At times, all can be appropriately lobbied, and there is nothing automatically wrong in an outside organisation seeking a meeting with a senior civil servant on a policy issue or with the Minister’s special adviser, but any such meetings should be open, declared and not available only to a select few over a glass of champagne at the cricket, as some may recall from episodes of “Yes Minister”.
However, Part 2 is a deliberate and, as we have heard, chilling curtailment of the democratic rights of those with greater public support and trust: charities and wider civil society organisations. I chair a not-for-profit organisation and I am involved with a number of charities and other voluntary organisations that provide services but also undertake campaigning. Despite amendment, it is clear that the Government are seeking to curtail the activities of such organisations against the interests of the big society about which we used to hear so much from the Government, although I do not recall hearing much recently. If we want a vibrant and engaged civil society it must be one in which members of the public can engage freely and not be told by the Government where the barriers and boundaries are.
At the Cabinet Office, I made it clear that a Labour Government would continue to be a strong advocate for the campaigning role of civil society organisations. Their role as campaigners provides a voice for some of the most disfranchised, disengaged and vulnerable in society.
However, in the lead-in to the previous general election, the writing was already on the wall. Criticisms that,
“so much of the effort in some parts of the voluntary sector is devoted to campaigning”,
became part of the sniping from the then Opposition before the election. In his speech to the NCVO conference in February 2010, Oliver Letwin stressed that what he treasured about the wider sector of civil society was not its campaigning role, but its special contribution to change things and to solve problems. How can the sector change things if the Government stop and restrict its campaigning? That kind of view fundamentally misunderstands and misrepresents the inextricable link between changing things and solving problems, and campaigning to do so.
It is not that as a Labour Government we tolerated that challenging campaigning role—we actively encouraged it. I have to be honest—it is not always comfortable or easy for Government to do so, but I am absolutely convinced that in many cases it makes for better government and better decision-making. Indeed I would go further and emphasise the point made by the noble Lord, Lord Adebowale. If an organisation that provides services of support considers that changes to government policy could resolve or even just alleviate the problem it is dealing with, it has a responsibility to its service users, its supporters, donors and to taxpayers, to address that and to campaign to do so. To go even further, it has an obligation to not just spend money to deal with the problem—if it can identify ways to alleviate or end that problem, then it should campaign to do so. The idea that the Government should tell that organisation not to campaign but to shut up and spend the money, is totally obscene.
It was the Brazilian archbishop, Dom Hélder Câmara, who said:
“When I give food to the poor, they call me a saint. When I ask why the poor have no food, they call me a Communist.”
I wonder what he would make of this Bill.
This Government talk about the big society on one hand, and seek to squeeze it smaller and smaller with the other. They must not curtail legitimate campaigning activity, or provide the opportunity for councils and governments to issue bad news and unpopular policies before an election, thus preventing campaigning against that policy; they must not stop organisations making their views known on party manifestos. The Government speak of engagement in civil society yet they are taking away the freedom and rights that strike at the very heart of our civil society.
Before the last general election, numerous charities and civil society organisations organised a series of hustings; I spoke as the Minister, as did my opposite number, the now Minister, Nick Hurd, and the Liberal Democrat spokeswoman Jenny Willott. We all went along to these meetings. They were challenging, they were campaigning, they pressed their views on us and they wanted to know our views. Would those hustings be allowed under this Bill, or would those organisations not be allowed to hold those hustings because that would be seen as campaigning too close to an election? What could be more democratic than engaging with campaigning and information at election time, with the hope of encouraging people to vote?
We have heard suggestions tonight, but we really have to wonder what this coalition Government are so scared of that they are desperate to use every possible measure to rush this Bill through before the next election. With no consultation and no draft Bill, as we have heard from our constitutional experts in the House, the Government have already been forced to make several amendments and they have not reassured the charities.
This is an undemocratic Bill and it is a sadly wasted opportunity. Instead of increasing transparency and restoring faith in the political system, instead of trying to encourage engagement, the Government have taken a giant step backwards. This Bill does the Government no credit and it goes against so much of what the Government used to claim they believed in. No wonder people do not trust politics.
Your Lordships’ House this evening has been almost entirely unanimous in its concern about, opposition to and dismay at this Bill. I hope that the Government have been listening to the very serious and heartfelt concerns that have been raised and that we are going to see some serious changes to this Bill. It will take a lot to make it acceptable to those organisations that do so much for our society and are being denied their right to influence Government.
Baroness Royall of Blaisdon
My Lords, I warmly welcome the noble Lord, Lord Horam, and I congratulate him on his maiden speech. He has certainly participated in a brilliant debate on a bad Bill that is badly drafted and, as my noble friend so dramatically demonstrated, not easily understood.
The Bill does not deal with the problem it was designed to address and has a chilling effect on civil society organisations and charities, which are a cornerstone of our society, while purporting to solve a problem with trade unions that does not exist. Furthermore, as this is a constitutional Bill, it should have had pre-legislative scrutiny, and due process should have been followed, including proper consultation, as demanded by governmental procedures. I must ask the Minister: why the unseemly haste, which so many noble Lords mentioned? Why was there absolutely no consultation with the organisations that will be most affected by the Bill—the myriad organisations up and down the country which are the basis of our thriving civil society? Could it be that the Government were so sighted on their goal of silencing organisations that they might regard as potential critics before the next general election that they simply abandoned the processes upon which government and good governance depend?
The Minister cannot accuse me of taking a political stance because these points have been made by noble Lords on all Benches. That must be a strong signal to the Minister that there is something drastically wrong with the Bill. Out of 38 speakers, the Bill has only one fervent champion—the noble Lord, Lord Tyler—and perhaps three or four lukewarm supporters. In relation to process, we heard powerful speeches from my noble friend Lady Jay, chair of your Lordships’ Constitution Committee, the noble Lord, Lord Norton of Louth, other members of the Constitution Committee and others of my noble friends who are members of the Joint Committee on Human Rights. When parliamentary processes are abused, especially in relation to constitutional Bills, Parliament itself is abused. To repeat the words of the Constitution Committee,
“if Parliament cannot be seen to be scrutinising proposals with the thoroughness they deserve, public confidence in parliamentarians is likely to be further undermined”.
The Dalai Lama said:
“A lack of transparency results in distrust and a deep sense of insecurity”.
I suggest that lack of transparency, especially where access to power is concerned, is one of the reasons that people feel alienated from politics. Lobbying is a normal and an essential part of an active democracy; that includes commercial lobbying. However, it has been clear for some time that the professional sector of the industry needs to be regulated. Indeed, the Prime Minister, when he was Leader of the Opposition, said that lobbying was,
“an issue that exposes the far-too-cosy relationship between politics, government, business and money”.
He was right. My party strongly supports a statutory universal register of lobbyists that covers all those who lobby, not just those working for consultancies. Sadly, the Government’s proposals in the Bill not only fail to deliver such a register but are a step backwards. As my noble friend pointed out, the proposed register would cover fewer lobbyists than the existing voluntary register set up by the UK Public Affairs Council.
I would be grateful if the Minister could tell the House why the register that the Government propose is intended to apply only to those lobbying on behalf of someone else: that is to say, to consultant lobbyists rather than to all lobbyists. The consensus in this House, in the lobbying industry, in the voluntary sector, in the trade unions and among transparency campaigners is that this approach is too narrow. Why should in-house lobbyists, who represent around 80% of the industry, not be required to register along with all other professional lobbyists? Not only is this wrong, it is unfair; it discriminates against different types of lobbyists. The cosy relationship between government and the tobacco and energy industries will continue, one reason being that there is a fundamental lack of understanding in the Government about lobbying.
Furthermore, the proposals before us create loopholes that will be exploited by the unscrupulous. I share the puzzlement of the noble Lord, Lord Jay. Why is it that someone will count as a lobbyist only if they lobby Ministers or Permanent Secretaries directly? As many have said, anyone who has been in government, in the Civil Service or a lobbyist would agree that the best results often come from lobbying MPs and Peers, more junior civil servants—including those who work in UKRep—and, of course, special advisers. One just has to cite the case of Adam Smith and the News Corporation lobbyist, Fred Michel, which would not have been touched by the Bill. Of course, who is lobbying whom is important but the subject matter is also of importance.
Too many people in this country have lost trust in politicians and the political system. The noble Baroness, Lady Kidron, spoke of the importance of young people taking an active part in campaigning as a path to engaging in democracy. In the most recent election, of the 18 to 24 year-olds who were eligible to vote, only 44% voted. A healthy democracy needs to be nurtured in order to thrive, and voting is crucial for legitimacy. It is a key part of a healthy society in which all citizens, not just the privileged few, have a say.
As the right reverend Prelate said, democracy is in crisis, and professional politics has meant that political energy has been quite rightly taken over by faith groups and by charities. As the noble Earl, Lord Clancarty, said, the Bill puts politics further into the Westminster bubble instead of opening it out to the whole population.
We all recall the Prime Minister’s big idea, the big society, which seems to have disappeared from the Conservatives’ lexicon. It was not a big idea, of course, because millions of people in this country have always been active citizens. Charities are part of our DNA, and my Government worked closely with civil society and NGOs. Nevertheless, apart from concern about the increased burdens on civil society as a consequence of government cuts and withdrawing some of their obligations, I was glad that the role of civil society was being celebrated, and that participants were no longer regarded merely as service providers. It is astonishing that the coalition Government, whose Members in this House have strong links with hundreds of charities and faith groups, should seek to curb the work and to silence the voice of charities and others who wish to campaign, for a year before the general election. There has been much concern about this.
As my noble friend said, the Government are hosting the annual summit of the Open Government Partnership in London on 31 October, where participants will share experiences from their respective countries and provide real examples of how openness can improve public service, drive economic growth, reduce poverty and corruption and restore public faith in government. One of the sessions, possibly attended by the right honourable Francis Maude MP, is entitled, “Empowering Citizens: Transforming the Relationship between Citizens and Government”. Presumably this will follow the partnership’s vision of ensuring that Governments become more transparent, more accountable and more responsive to their citizens. That is contrary to the ethos of the Bill before us.
My noble friend Lady Pitkeathley gave the most stunning example of the beneficial results of campaigning by charities—that is to say, apolitical campaigning, which would not be possible under the Bill. My noble friend Lord Griffiths spoke with a passion that I feel.
Many organisations have been cited today with regard to Part 2 of the Bill, and I am grateful for the vast number of briefings received. My noble friend Lady Jay encapsulated many of the fears expressed by those organisations when she said that the Constitution Committee is concerned about the restrictions on the right to freedom of expression that will result from the proposal to limit third-party expenditure at general elections. We think that this constitutional right should be interfered with only when there is clear justification for doing so.
The Opposition requested and received two legal opinions on the Bill from a pairing of eminent barristers specialising in this field: James Goudie QC of 11 King’s Bench and Fraser Campbell of Blackstone Chambers. The damning conclusion of the legal opinion is that the Bill infringes both Article 10 of the European Convention on Human Rights on freedom of expression, and Article 11 on freedom of assembly and association. The lack of clarity surrounding Part 2 means that it is not sufficiently precise and accessible to enable an individual to foresee to a degree that is reasonable in the circumstances the penal consequences that breaching them would have. Furthermore, the provisions are judged,
“not necessary in a democratic society”,
because they are “disproportionate” and both,
“unduly burdensome and too wide”.
Large organisations are concerned about complexities, the tangle of red tape and the chilling effect, but the smaller organisations are terrified—for example, about the reduction from £10,000 to £5,000 of the threshold at which they would need to register with the Electoral Commission in England, and to £2,000 in Scotland, Wales and Northern Ireland. On its own, £5,000 is a lot of money for a small charity to spend, but, as has been pointed out, charities often work in partnership with others, and all organisations in a joint campaign are responsible for declaring all the spend above the threshold. The British Legion, writing about the cost of the increased regulatory burden, said:
“Even the Legion, which is a relatively large charity, has no dedicated administrative support within its campaign team, and we do not believe that members of the public purchase Poppies in order to fund the servicing of such requirements”.
This is a costly bureaucratic nightmare, and charities and communities may either unwittingly break the law or be inhibited from campaigning in the public interest.
The excellent organisation cited by the noble Lord, Lord Greaves, HOPE not hate, which does so much to promote peace among our communities and provides information about candidates standing for the far right in elections, would be restricted to a fraction of what the BNP could spend in any election period. Are the Government trying to suggest that this and similar organisations should form a political party in order to be able to campaign?
The noble and right reverend Lord, Lord Harries of Pentregarth, chair of the Commission on Civil Society and Democratic Engagement, raised a vast number of questions on behalf of charities and campaigning groups, and explained their fears and complexities. I warmly welcome the initiative taken by the noble and right reverend Lord, and his colleagues, including my noble friend, which fills a yawning gap in the Government’s own procedures. They were able to consult a vast variety of NGOs and experts up and down the country, so why could the Government not do that? I very much look forward to the commission’s report and its recommendations before Committee. The lack of consultation is compounded in Scotland, Wales and Northern Ireland, where neither the organisations affected nor the devolved institutions were consulted. That is of particular importance in Northern Ireland, where civil society engagement is a cornerstone of the peace process, and is one reason why such great progress has been made and must be sustained.
As my noble friends have said, there is no evidence for why Part 3 of the Bill is needed, and no Minister has been able adequately to explain the reason. I almost feel sorry for the noble Viscount. He had to defend the indefensible on the shares-for-rights Bill, and now he has to find a reason for Part 3. As my noble friend Lord Monks said, since 2004 there have been no complaints to a certification officer from trade union members about the registration of their details, and from 2000 to 2004 there were just six complaints, of which five were thrown out. What, then, is the problem?
Seldom can a Bill have had so few friends—the only friends it has sit on the coalition Benches; or rather, the only friend—and seldom has a Bill had so many opposed to it. Seldom has a Bill raised common concerns and united the whole of civil society, including charities and community organisations large and small, trade unions, professional organisations, lawyers, professional lobbyists and their associations, the Joint Committee on Human Rights, the Constitution Committee of your Lordships’ House, the Political and Constitutional Reform Committee of the other place, the Financial Times and the Guardian. The vast majority of the committees, organisations and individuals have asked the Government to pause and think again. As the noble Lord, Lord Ramsbotham, said, the Government should do so before they inflict unnecessary damage on one of the jewels in our crown: the voluntary sector.
It is clear from most of the speeches made today that there is strong support in this House for the Government to withdraw the Bill, consult and return with a Bill that is fit for purpose. The lobbying proposals should be revised and Part 2 should be the subject of cross-party agreement. These issues are too serious to be used as a political football. The problem that Part 3 is designed to answer must be identified before solutions are proposed.
There are fundamental lessons to be learned from the Bill. Pre-legislative scrutiny should be standard practice; Bills—especially constitutional Bills—must not be rushed through Parliament in order to fulfil a political objective; and consultation with those affected absolutely must take place. I trust that the Minister will give his assurance that this lack of respect for parliamentary procedures and the people with whom they should consult will not be repeated.
Most importantly, on behalf of all of the organisations and individuals affected, all of our citizens who lack trust in Parliament, politics and politicians, and the majority of noble Lords who have spoken today, I urge the Minister to pause, to withdraw the Bill, to consult and to return to Parliament with a Bill that commands the respect and support that these issues of fundamental importance to our democracy deserve.
Lord Wallace of Saltaire (LD)
My Lords, this has been a vigorous debate with a wide range of opinions forcefully expressed around the House. First, the Government are listening and consulting, and we will continue to do so. We will take this carefully through Committee, and we are concerned to make sure that the Bill as it emerges from this House reassures the very evident concerns, particularly from the charity sector. The noble Lord, Lord Judd, rightly said that the charity sector perceives this as an attack. That is, by and large, a mistaken perception. However, of course we have to reassure people and make sure, as we take this Bill through the various stages, that we have a Bill that we are all happy with as it emerges from this House.
Let me take the three parts in order. First, on the lobbying issue, as a number of noble Lords said, lobbying is a legitimate activity. Indeed, it is central to any thriving democracy and is an almost universal activity. Almost every working day Parliament is being lobbied. Those who had offices on the West Front particularly enjoyed the London Gay Men’s Chorus lobbying us several nights in a row. We wished that they would come back more often. It was one of the most enjoyable bits of lobbying that we have had so far.
Part 1 is intended to focus on professional lobbyists, the skilled and the well paid, those who provide their services for hire. The noble Baroness, Lady Smith, talked about lobbying companies which do not even declare their clients. That is precisely what Part 1 addresses to make sure that lobbying companies declare their clients. That is where we started out in our consultation in 2010-11. I regret to say that the various respondents to that consultation came back with a whole range of discordant and dissentious responses. The Government have decided to take the Australian approach to a lobbying register, which is to have a register of professional and consultant lobbyists, not a universal register.
Baroness Hayter of Kentish Town
Will the Minister accept that if a Minister meets lobbyists of that sort, although there may well be a list on a website with their 40 clients, it will not tell anybody which client that Minister was meeting? All it will say is that those are their 40 clients. Anyone will still be in the dark about which client had set up that meeting with the Minister.
Lord Wallace of Saltaire
I take the point that the noble Baroness makes. She has said to me off the Floor of the House that this ought to be reinforced by making sure that in the notes of the meeting there is a reference to the subject of the meeting so that those in the press and outside who want to understand what happened are informed which of the clients the meeting was about. This is therefore a step towards transparency. It does not claim to provide complete transparency on all contacts between outside proponents of particular policies and Ministers or officials. If we were to do that, we would find ourselves with a huge amount of information of the sort that the NSA loves to collect for the United States, but might not be beneficial to British politics. If we were to include all lobbyists, as some of the answers to the consultation wished, and included all charity lobbyists, I think that the answer from the charities sector would also be very negative. However, charities do have lobbyists. For example, Oxfam has people who actively lobby the public and the Government. Therefore, we have to be a little careful over how universal one needs to be. That is the importance of starting—perhaps others will want to go further—with a register of consultant lobbyists and of their major contact with the Government.
The noble Lord, Lord Norton, suggested that we should start at the other end by asking all officials and Ministers to register whom they have met. I see no reason why, in a sense, as transparency develops, the two should not come together. I have just filled in my quarterly return of whom I have met, including a number of people who could be described as lobbyists. Indeed, Saferworld was one of those that I reported on for obvious reasons: as I represent the Foreign Office, I talk to Saferworld and other such charities. That is part of what we already do.
The question of how far down the list one should go and whether it should include special advisers has also been raised. That clearly is a question to which we will return in Committee, and I look forward to that debate. However, I am conscious that the major concerns are on Part 2, to which I now turn.
I assure the noble Lord, Lord Phillips, that a Keeling schedule will be available well before Committee for everyone who wishes to look at it. I say with due confidence that, since he first asked me that question, I have discovered what a Keeling schedule is.
Lord Rooker
With respect, that is a worry, because that is the kind of thing that the Minister should have been advised about before the Bill was introduced. For the Minister to say now—and I am not being personal about this—that he did not know what a Keeling schedule was when we have a major constitutional Bill, and it is the norm to do it this way and has been for a long time, shows a failure of those who have been advising Ministers.
Lord Wallace of Saltaire
It shows my ignorance more than anything. The Bill team has a Keeling schedule, and it will be distributed. Of course, the Bill team has a Keeling schedule—it is part of what Bill teams have to do in preparing the Bill. Since this is a rather complicated amendment of PPERA, that is what we are into.
I stress, as has been stressed by a number of noble Lords, that this is an amendment to PPERA. It is about election law, not about charities law; charities are not the main target and not those mainly affected by it. The most recent Electoral Commission report on this said:
“The Commission believes that, where significant non-party campaigning takes place, this should be transparent and properly regulated ... We think these controls on campaigning that is not explicitly ‘party political’ are a necessary part of the regime. Without them, it would be easy to evade the rules by framing political campaigning in terms of policies. For similar reasons, we do not think the rules should exclude particular types of organisations, such as charities or voluntary bodies, as this would create opportunities for political campaigners to evade the rules and would reduce transparency. However, the necessarily wide scope of the definition of controlled spending makes it particularly important to consider the overall impact on campaigners of Part 2 of the Bill, including the registration thresholds and spending limits”.
That is what we will focus on in Committee—but it is correct that we should include this in the scope of the Bill.
I was quite surprised—
Baroness Royall of Blaisdon
As the Minister has just said, rightly, that it is important to look at the effect on charities and campaigning organisations affected by the Bill, why did the Government not consult those bodies before bringing the Bill forward? The Minister said just now that now that they had had their Second Reading they were going to consult. Why did not the Government consult beforehand?
Lord Wallace of Saltaire
I am conscious of a number of meetings with ACEVO, the NCVO and a number of other organisations over the past few months—and we are continuing to consult them. So we are not just about to start; we have been consulting.
I was quite surprised that no one had looked at the list of registered third parties for controlled expenditure for the 2010 general election, which seems to be a relevant part of the background. There are 30 of them on the list that I have here; six of them are in the field of animal welfare, which is hardly surprising—and the noble Baroness, Lady Mallalieu, is nodding at me as I say this. There are two major unions. Among others, there is an interesting body called the Young Britons’ Foundation. I Googled several of these bodies just to discover them, and perhaps I can read something for those noble Lords who think that American campaigning has not yet reached Britain. It says that the foundation,
“was launched in July 2003 at a conference of the Young America’s Foundation in Washington, D.C., and it has said that it aims to ‘import American political techniques into the UK’”.
On the most recent knowledge that I have, its advisory board included,
“representatives of the Heritage Foundation … US Competitive Enterprise Institute and American Conservative Union”,
and a number of other, similar bodies.
Lord Greaves
I was very confused by the quote that my noble friend read from the Electoral Commission, which refers to “political campaigning”. The existing PPERA and the proposed wording as amended in the House of Commons on Report in this Bill do not refer to political campaigning at all. Clause 26(2)(b) now says that,
“the expenditure can reasonably be regarded as intended to promote or procure electoral success at any relevant election for … one or more particular registered parties … one or more registered parties”,
and so on. This is about electoral campaigning. It seems to me that the dividing line is between general political campaigning on the one hand and electoral campaigning seeking the success or non-success of a particular party or candidate on the other. What my noble friend has just read out seems to muddy the waters. This will be an absolutely crucial discussion in Committee.
Lord Wallace of Saltaire
My Lords, I was about to come to precisely that distinction because it seems to me to be the nub of what we will have to discuss when we deal with Part 2. There is a line to be drawn between the promotion of policies and the promotion of the success or defeat of particular parties or candidates. Policing the line between informing and educating the public during a campaign, promoting particular policies during a campaign and, on the other side of the line, supporting or opposing particular candidates or parties during a campaign, is the point on which we need to focus during Committee and Report. I am concerned that this is not an easy line to define. We want to make sure that there is as small a grey area as possible. At the all-Peers meeting, the noble Lord, Lord Dubs, quoted a leaflet which had been put round his constituency the day before he lost an election which had a very large headline saying, “We are not telling you who to vote for”, and then a lot of small print which did. That is the sort of thing that we will have to look at in detail.
This measure is not aimed primarily at charities. Indeed, of the 30 organisations on the list, three are the campaigning non-charitable associated bodies of charities, but none is a charity. Charities should not be caught by this measure. After all, charities law limits how far charities can become involved in partisan campaigning. Charities should be involved in political campaigning. I recommend that noble Lords look at the list to see how far we can come to an agreement on the borderline. The noble and right reverend Lord, Lord Harries, talked precisely about the borderline between current activities and controlled activities, and the chilling effect of having an uncertain definition of that. However, that is where we are. From the discussions I have had with people over the past few weeks, I have the slight impression that a large number of charities had not actually read the Political Parties, Elections and Referendums Act until this Bill was produced. Having looked at the language of that Act, a number of charities are telling us that they are not happy with that language as it stands. We have entered a discussion that we should perhaps have had earlier. The Government started on the assumption that the language of PPERA was fine because we had—
Lord Wallace of Saltaire
May I just finish my point? We had been through two elections with that language and charities do not appear to have found it difficult. If charities are now telling us that they find that language difficult, clearly we need to have a rather different discussion. I give way.
Lord Lea of Crondall
I thank the noble Lord for giving way. He may not be able to answer my next point tonight. However, as I understand it, charities registered with the Charity Commission cannot be so registered if they have political purposes. Therefore, will the noble Lord comment on, or write to me, about what he means when he talks about charities having political purposes?
Lord Wallace of Saltaire
I hesitate to go into a definition of politics as the noble Lord, Lord Norton, will immediately correct me. The promotion of particular policies, particularly broad policy areas, is a natural and accepted part of what charities and faith bodies do. That is a normal part of civil society. Part of my puzzlement, in listening to one or two of the speeches tonight, is that civil society is itself broader than the charitable sector. There are campaigning bodies in civil society which are not, and should not be, charities. Charities promote particular ideas, developments and social objectives which are also unavoidably political objectives, but they are not necessarily partisan objectives. That again is the line that we need to draw. I note that the noble and right reverend Lord, Lord Harries, said that charities are already unhappy about PPERA. Having looked at it, there are a number of difficult questions that we need—
Lord Phillips of Sudbury
It might be beneficial for all of us if the Minister and his advisers were to say how far the Charity Commission guidelines fall short of what the Bill is intending to do. If there is no significant air between the two, we might all need to know that.
Lord Wallace of Saltaire
I accept—and have also had it said to me in the Corridors—that we need to make sure that the guidance from the Electoral Commission, the Charity Commission and the Government are all in very close harmony. That is another area that we are, of course, now looking at.
The time is late. I will come very briefly to Part 3. Again, I recognise what has been said powerfully by a number of noble Lords here with trade union experience. We will come back to this in Committee, so I will say simply that unions are a major and extremely valuable aspect of our economy and our society. They have changed through a number of amalgamations over recent years and the Government consider the question of how accurate the membership lists of major unions are—we are talking about unions with 1 million or more members—is an appropriate point to be regulated. However, I take all the points—
Baroness Royall of Blaisdon
My Lords, we are talking about unions with a membership of more than 10,000, as I understand it; that is what is in the proposal, not 1 million.
Lord Wallace of Saltaire
However, we are not talking about the smallest unions.
I take the point from, I think, the noble Lord, Lord Whitty, about whether information given to the assurer or certification officer might fall into other hands. That is a large issue of data privacy—this was raised by another noble Lord—which raises broader issues that concern the Government across the board. I will give him my assurance now but I will also check back and make sure that there are cast-iron assurances that data privacy issues will be resolved. We will have—
Lord Whitty
I think it was my noble friend Lord, Lord Monks, who raised that point. The Minister has not yet said why the Government are proposing Part 3 of this Bill. There are all sorts of suspicions out there, some of which have been voiced tonight, including by me, but the Government have not told the House why they are proposing this part of the Bill.
Lord Wallace of Saltaire
My Lords, the Government are concerned that there is insufficient public understanding when, for example, a union calls a strike vote, that those being polled are those who are currently working. They wish to assure the members and others in society that the lists are accurate. This is not just for unions. Companies are also expected to maintain an accurate register of their members and shareholders and to keep it up to date. This will cover a range of different bodies. I give way once more and then we must finish.
Lord Lea of Crondall
Is the Minister aware that that is not the reason given in the explanatory document?
Lord Wallace of Saltaire
My Lords, we will return to the explanatory document at a later stage. This has been an extremely vigorous evening. We look forward to several days in Committee and on Report. The Government will consult a range of stakeholders between Second Reading and Committee, and we will continue to consult between Committee and Report. This House will, as the noble Lord, Lord Greaves, assured me very vigorously, look in detail at the language of the Bill and also look back at the language of PPERA, and, we hope, produce something of which we can all be proud at the end of the day.
Lord Hardie
I wonder whether the Minister will address the concerns of local action groups, as opposed to charities.
Lord Wallace of Saltaire
I am sorry; I did not hear the noble and learned Lord.
Lord Hardie
I was asking about local action groups as opposed to charities.
Lord Wallace of Saltaire
My Lords, local action groups, if they are not campaigning for or against a particular candidate or a particular party, will not fall within the terms of the Bill.
Lord Hardie
The Minister obviously did not hear my speech. I referred to the situation where a local action group had a particular interest—for example, against the closure of a hospital or against, or in favour of, HS2, or other environmental situations. If one candidate supported that view and another candidate was opposed to it, that would be controlled expenditure. Is that to be stopped?
Lord Wallace of Saltaire
In the case of Kidderminster Hospital, which I think was one of the examples quoted, there was indeed a candidate who was the Kidderminster Hospital candidate. That of course then becomes a much clearer case.
The hour is late and I should like, if I may, to continue these discussions in the Corridors between Second Reading and Committee.