Monday 25th April 2022
(2 years, 7 months ago)
Lords ChamberElections Act 2022 View all Elections Act 2022 Debates Read Hansard Text Amendment Paper: HL Bill 141-II Second marshalled list for Report - (21 Apr 2022)
16:52 - Division on Amendment 45 - Ayes: 265 / Noes: 199 - Amendment 45 agreed.
19:17 - Division on Amendment 63 - Ayes: 194 / Noes: 220 - Amendment 63 disagreed.
20:00 - Division on Amendment 69A - Ayes: 169 / Noes: 209 - Amendment 69A disagreed.
Baroness Hayman of Ullock (Lab)
My Lords, we very much welcome these amendments. We thank the noble and learned Lord, Lord Judge, for tabling them and for his excellent and clear introduction on his concerns about the implications of leaving these clauses in the Bill. I will be brief, as he and many other noble Lords made excellent speeches today.
We have made it extremely clear on previous stages of the Bill’s consideration that we are extremely concerned about its intention to make provisions for a power to designate a strategy and policy statement for the Electoral Commission, drafted by government. As other noble Lords have said, this would allow political interference in the regulation of our elections and calls into question the independence of the Electoral Commission from government and political control. This simply cannot be allowed to happen. It is a dangerous precedent. If we look at similar democracies such as Canada, New Zealand or Australia, there is always a complete separation between government and the electoral commission. It is essential that our regulatory framework strikes the right balance between upholding the independence of the Electoral Commission and ensuring it is properly scrutinised and held to account. The noble Lord, Lord Hayward, made some good points about the fact that we need to look at how it operates, but this is absolutely not the way to go about it.
I remind those noble Lords who have said that this is not of any concern that new Section 4B(2) in Clause 15 says that:
“The Commission must have regard to the statement when carrying out their functions”—
“must”, not “may”. That is what really concerns us. We have had many excellent speeches, so I urge the Minister to listen very carefully to what has been said in the defence of our democracy. That is what we are talking about. We fully support these amendments and urge other noble Lords to do the same when this is put to the House.
The Minister of State, Cabinet Office (Lord True) (Con)
My Lords, I have not detected universal enthusiasm for these clauses in the debate, but I will seek to persuade your Lordships that they should remain. Of course, in remaining, one of the things they do is provide a basis for further discussion.
Your Lordships’ House is a revising Chamber, but we do not have here amendments to revise. These amendments would simply remove clauses on the basis of arguments which, in my submission, are exaggerated in their concerns, although I understand and share the concerns for democratic responsibility and respect. We have even heard several threats to kill the whole Bill. I must remind noble Lords that this is a Bill that prevents election fraud and abuse; introduces the first controls on digital campaigning; cracks down in many ways on foreign spending; and improves the integrity of postal voting. These are matters which have wide assent across the Chamber and across both Houses. It would not be wise or proportionate for your Lordships to consider killing those proposals on the basis of this particular issue.
Lord Cormack (Con)
Would my noble friend accept that if the Government withdraw these clauses, on which there is a great deal of opposition, the Bill will go through? Several of us have said that it has many excellent features. We do not want to kill the Bill, but we do want to remove this anti-democratic element from it.
Lord True (Con)
My Lords, I can only respond to the language I heard in the debate and, of course, that will lie in Hansard. Of course I listen to the range of concerns set out by your Lordships. The main concern that I hear, and understand, is about the potential impact on the independence of the Electoral Commission.
I stated in Committee, and I do so again now, that the Government’s proposals take a proportionate approach to reforming the accountability of the commission to Parliament, which some who have spoken have admitted could be reviewed, while respecting its operational independence. I agree with the noble and learned Lord, Lord Judge, and others that it is vital we have an independent regulator that commands trust across the political spectrum.
By the way, the noble Lord, Lord Stunell, asked would I worry if the Labour Party had such powers on the statute book. I remind your Lordships that the Labour Party is a great constitutional party, and I would trust it to use the responsibilities and powers that it had in an appropriate manner.
In previous debates, parliamentarians across both Houses identified areas of concern with the commission’s work. My noble friend Lord Hodgson of Astley Abbotts spoke to this. Under the existing accountability framework, in practice, parliamentarians are limited in their ability to scrutinise and hold the commission effectively accountable. The report by my noble friend Lord Pickles, whom I am pleased to see in his place, obviously alluded to certain issues that he felt had not been fully addressed. These measures will seek to remedy this by providing guidance, as approved by Parliament, for the commission to consider in the exercise of its functions, and by giving the Speaker’s Committee an enhanced role in holding the commission to account in how it has performed its duties in relation to the proposed statement.
It has been suggested, several times, that the “duty to have regard” to the strategy and policy statement placed on the commission in Clause 15 will weaken its independence and give Ministers the power to direct it. The Government strongly reject this characterisation of the measures. The Electoral Commission will remain operationally independent and governed by its Electoral Commissioners as a result of this measure, after as before. This duty does not allow the Government to direct the work of the commission, nor does it undermine the commission’s other statutory duties.
Baroness Wheatcroft (CB)
I wonder, given what the Minister has just said, whether he could explain the purpose of new Section 13ZA, on the examination of the duty to have regard to the strategy and policy statement, which states:
“The Speaker’s Committee may examine the performance by the Commission of the Commission’s duty under section 4B(2) (duty to have regard to strategy and policy statement).”
What is the purpose of having the ability to examine the commitment to the policy statement? What would the Government do if it found that “have regard” had not been sufficient?
Lord True (Con)
My Lords, I say to the noble Baroness that it is not a power to direct. The Speaker’s Committee is not a government institution; it is part of the architecture that is there, and has been there, to oversee the work of the commission. That was inherent in previous legislation; this legislation seeks to improve its ability to do so. What the legislation means is that when carrying out its functions, yes, the commission will be asked to consider the statement, but weigh it up against any other relative considerations.
The noble and learned Lord, Lord Judge, knows the respect I have for him. I have enjoyed discussing this matter with him and no doubt may again if he has his way in your Lordships’ House today, which I hope he will not, but our contention is that there are a number of safeguarding provisions around parliamentary approval and consultation built into Clause 15. I outlined that at length in previous debates and will not repeat it here. I believe, notwithstanding the noble and learned Lord’s remarks, that those safeguarding provisions should reassure those who have expressed concerns about strategy and policy statements being drafted by future Governments that may have ill intent.
Lord Blunkett (Lab)
Can the Minister list which Select Committees have Ministers as members?
Lord True (Con)
My Lords, as the noble Lord knows, the Speaker’s Committee is sui generis. Obviously, it has senior representation from political parties in the House of Commons. I have enormous respect and affection for the noble Lord. It is not reasonable to impugn the integrity of a Speaker’s Committee and I do not think that he was doing so—
Lord Blunkett (Lab)
I was not, in any way, impugning the Speaker’s Committee. I was picking up the point that the Minister had just made about the corollary of a Select Committee.
Lord True (Con)
My Lords, I am glad that the noble Lord rose. I had started to make it clear that I was not making any such proposal. The analogy I was using is just a mechanism in terms of the way that the committee will be able to conduct its reviews, effectively holding the commission accountable on a broader range of its activities than is currently allowed in law. As I sought to explain to your Lordships, that remit is currently narrowly restricted.
For the reasons that I have set out, I urge that my noble friends and noble Lords across the House oppose the amendments put forward by the noble and learned Lord, and that Clauses 15 and 16 stand part of the Bill.
Lord Judge (CB)
My Lords, I thank everybody who has participated, including those Members of the House who do not agree with me. It is fun to listen to alternative arguments.
I have just a couple of points to make. The problem with these clauses is that they were inserted without any kind of discussion. When constitutional issues are being addressed, and when, in particular, the independence of the Electoral Commission and its performance are being addressed, surely, of all things, that is something for cross-party discussion, and it is for the cross-parties to make up their minds how to make the Electoral Commission do its job and perform its function better than it has. That is a matter for Parliament: I am not going to advance different solutions to this, but the problem is that nobody has asked anybody else. That is why I describe this proposal as “new minted”. It is “new minted”, and that is one of its problems.
The other problem is with the phrase “must have regard to”. I “must have regard” to everything the Minister says. I am going to listen to it; I am going to be influenced by it. I might not feel quite as strongly as I did against him—I do not know—but the point is that you have to have regard to the statement by the Minister of the Government’s strategies, priorities and guidance, and that would influence any body of people, however independent-minded they are and wish to be. That, surely, is the point of this legislation. The Government want the commission to be influenced by the strategy and priorities paper.
If the Electoral Commission says, “Well, we have seen what the Minister has to say. We have read the statement and we think it’s a load of rubbish”, what happens then? Apart from anything else, the noble Lord, Lord Pannick, will be briefed on a judicial review by the Government that the Electoral Commission was not exercising its powers correctly, and he would probably win. As I have told noble Lords before, he never won a single case in front of me; and as I have also told noble Lords before, on every occasion when he appealed, he won.
Member’s explanatory statement
See the amendment in Lord True’s name at page 10, line 33.
Lord Collins of Highbury (Lab)
I do not have much to add to the noble Lord’s contribution. We support his contention that this is an unnecessary clause. I agree that the principle is one that we should completely reaffirm, as the noble Lord, Lord Young of Cookham, did in a previous debate. We need the assurances from the Minister. If he is unable to give the assurances that the noble Lord, Lord Rennard, seeks, we will support him if he decides to divide the House.
Lord True (Con)
My Lords, as noble Lords will know, Clause 19 is there to clarify the law on benefits in kind and make it clear that candidates need to report only benefits in kind that they have actually used or which they or their election agent have directed, authorised or encouraged someone else to use on their behalf. We had some discussion on this in Committee, as the noble Lord acknowledges. This was already widely understood to be true, prior to the Supreme Court judgment in R v Mackinlay and others. The Supreme Court judgment has led to concerns that candidates and agents could be responsible for spending they had not consented to or were unaware of or not involved in. This is an unacceptable situation and risks a chilling effect on people willing to put themselves forward as candidates and agents.
The noble Lord has been so kind as to refer to the positive engagement we had and I thank him for his continued interest in and engagement on the topic. In response to some of the concerns he raised, including those raised again today, I am happy to provide clarity on the government position. The noble Lord, Lord Rennard, asked two specific questions and I can say to him that the Government are absolutely committed to the long-standing principle of a level playing field for general election campaigns, whether in campaigning being carried out at constituency level or nationally. The noble Lord referred to a statement made by my noble friend Lord Young of Cookham in 2019 when agreeing with the importance of the principle of a level playing field in relation to spending at elections. The Government maintain the commitment my noble friend gave; nothing in the Bill seeks to undermine that principle.
The proposals in the Bill will not change the fundamental principle that party spending in support of a particular candidate in a local area falls to be recorded as candidate spending against the local limit. Instead, the clauses bring forward changes seeking to maintain the level playing field by ensuring that all candidates and agents across the political spectrum are clear and confident in their legal responsibilities. Clause 19 also makes an equivalent amendment to the same rules for other types of campaigners, such as political parties and third-party campaigners, to ensure that the rules are consistent. We believe that these changes will bring much-needed reassurance and clarity to candidates and their agents on the rules which apply to notional expenditure for reserved elections. In combination with expanded statutory guidance—which we will discuss shortly—from the Electoral Commission on this matter provided for in Clause 20, this measure will support compliance with the rules and ensure that those wishing to participate in public life can feel confident doing so, clear in their obligations.
The noble Lord, Lord Rennard, asked a further and very specific question. I can say to him that the Government are not acting in response to the judgment of Southwark Crown Court in 2019 in relation to campaigning in South Thanet in 2015. However, the Supreme Court’s judgment in 2018 related specifically to the consideration of a particular point of law and concluded that there was no requirement for authorisation in Section 90(3) of the 2000 Act, which was contrary to the understanding of many and led to concerns about what expenses could potentially be incurred on a candidate’s behalf even without their knowledge. As a result, there have been calls from across the political spectrum for clarification of those rules. A cross-party committee of MPs, PACAC and the Law Commission have called for clarity on the rules in recent reports. The changes enacted by the Bill will only clarify the law so that it can be commonly understood. As I said, any uncertainty could lead to a democratic chilling effect, with candidates and election agents, who are often volunteers and fearful of their personal circumstances, unwilling to expose themselves to risk.
Finally, it is important to note that Section 75 of the Representation of the People Act 1983 already prohibits “local” third-party spending over £700 which has not been “authorised in writing”; therefore, it requires specific authorisation. Where such spending is authorised by a candidate, the candidate must also report on the spending incurred by the third party. If a third party, which could include a political party, spends over that threshold without authorisation, an offence has been committed. The Elections Bill does not alter this. Where a third party, including a political party, has provided property, goods and services free of charge or at a discount, or has made use of property, this must be recorded as a notional expense.
I can assure the noble Lord on those points that we are absolutely committed to the assurance my noble friend gave and that we are not acting in response to the judgment of Southwark Crown Court in 2019 in relation to 2015 and the issues of uncertainty that have arisen. Therefore, I hope that the noble Lord will accept those assurances and be ready to withdraw his amendment that would remove this clause from the Bill.
Lord Rennard (LD)
My Lords, I am grateful to the Minister for those warm words and his reassurance, and for his engagement and that of his officials on this important issue of election law. We have certainly made great progress on the issue since we began discussing what may happen in relation to notional expenditure and the original Private Member’s Bill, but I take from everything that he says, when he refers to clarification following the Supreme Court judgment, that any court in future would say that nothing in this clause should be taken as a change in the law.
I remain unconvinced that it is necessary but I am pleased that the Minister, in his correspondence, particularly that to all Members of the House on 4 April—if I may paraphrase slightly what he said—made it clear that there is no get out of jail free card for a candidate or agent who encourages excessive spending in a constituency and simply relies on the claim not to have authorised it. The word “encouraging” is quite significant in how that may be taken in a court in future should there be controversy over election expenses. It means that there cannot be a nod and a wink to expenditure in the cause of winning a constituency without accepting that such expenditure must be specifically authorised, to a £700 limit, for a third party. An election agent who told their HQ that they were delivering a leaflet with the local volunteers over the weekend so it would be convenient if two coachloads of paid activists could come on Wednesday and Thursday would certainly be encouraging illegal spending, as would providing them with maps and assisting them with their dining and hotel arrangements when they came to canvass or deliver in the constituency.
In my view, it remains a loophole that we must examine at another time that parties can post huge quantities of direct mail to a constituency aimed at influencing the vote there but claim that it is nothing to do with the local candidate. However, given that the Electoral Commission should retain its independence to advise on such matters, and that such advice could again be evidence in court, I beg leave to withdraw the amendment.
Lord Collins of Highbury (Lab)
My Lords, I rise briefly to welcome and support the noble Lord. Throughout the stages of the Bill, I have repeatedly welcomed some of his contributions, particularly in relation to third-party campaigning and creating the certainty and clarity that they need to ensure that the chilling effect does not have a huge impact on our democracy. I very much welcome this, and I welcome the principle that the code of practice provides that necessary parliamentary scrutiny. We welcome these amendments.
Lord True (Con)
My Lords, one of the charming aspects of your Lordships’ House is that when a Minister is being chided for not listening to the House it is rammed to the gills but when the Government make a concession there are not quite so many here. None the less, I thank not only my noble friend Lord Hodgson but colleagues in other parts of the House who have made this case, including the noble Lord, Lord Blunkett, who is not in his place for perfectly understandable reasons.
The amendment would create a new clause in the Bill which would remove a permissive power that allowed the Electoral Commission to prepare a code of practice, and instead, as your Lordships have asked, replace it with a requirement on the Electoral Commission to produce such a code of conduct. It also specifies the scope of the code, sets out the consultation process and procedure for the code, and creates a defence for third parties who are charged with offences under Part 6 of PPERA. It also makes the necessary consequential amendments to Clauses 20 and 25.
As my noble friend kindly acknowledged, in Committee I promised to consider his suggestions on a code of practice for third-party campaigners. He made his arguments in good faith, on the basis of great experience and genuinely reflecting the opinions of the sector. As he acknowledged, my officials and I have since met him and concluded that these changes are necessary and important for third-party campaigners.
The new statutory guidance—I do not know whether it will come to be called “the Hodgson guidance”—will provide certainty for third-party campaigners on how to comply with the rules relating to third-party campaigning. The amendment provides for the guidance to be comprehensive, and I say to my noble friend that it is our hope that this will address the term “the public” used in Part 1 of Schedule 8A on qualifying expenses.
The amendment requires the commission to consult the Speaker’s Committee on the Electoral Commission and the Levelling Up, Housing and Communities Committee, as in our earlier proposals on the strategy document. It also requires the commission to consult such other persons as the commission considers appropriate. As part of the statutory consultation, the Government would certainly expect a cross-section of civil society groups to be consulted; I can give my noble friend that assurance.
I am pleased to confirm that the Government are fully supportive of these three amendments, and I very much hope that your Lordships will support my noble friend.
Member’s explanatory statement
See the amendment in Lord True’s name at page 10, line 33.
“(10) An order under subsection (9)(b) or (c) may be made only where the order gives effect to a recommendation of the Commission.”Member’s explanatory statement
This amendment makes the power to remove or vary entries in the list of categories of third party that may be recognised for the purposes of Part 6 of the Political Parties, Elections and Referendums Act 2000 exercisable only on the recommendation of the Electoral Commission.
Lord True (Con)
My Lords, Clause 26 allows the Secretary of State to lay legislation before Parliament to amend the list of eligible categories of third-party campaigners in PPERA 2000. As we discussed at earlier stages, this is necessary in instances where, for example, legitimate categories not currently on the list emerge in the future. Without it, they would be significantly restricted in their ability to campaign if they could not be added to the list quickly. We consider the power to remove and vary entries equally as necessary in ensuring that the list of categories remains accurate. Any order, regardless of whether it adds, varies or removes categories, will be subject to full parliamentary scrutiny by both Houses, via the affirmative resolution procedure.
However, the Government have listened carefully to, and taken note of, concerns raised by noble Lords during debates, by the Delegated Powers and Regulatory Reform Committee in its recent report and by representatives from civil society organisations in recent meetings. In recognition of the strength of feeling on this issue, which I understand, I have therefore tabled an amendment that would mean that any order to remove or vary the description of a category of third-party campaigner can only—I emphasise “only”—be made where it gives effect to a recommendation of the Electoral Commission. This Electoral Commission lock will provide the necessary safeguard against any future Government potentially seeking to misuse this clause. I hope that noble Lords will recognise that the Government are earnestly seeking to reassure those concerned by this clause, and that they will support this amendment.
Member’s explanatory statement
This amendment would leave out Clause 28 (joint campaigning by registered parties and third parties).
Lord Collins of Highbury (Lab)
My Lords, we had a lengthy debate on this in Committee and I accepted what the noble Baroness the Minister said at the time, that actually the requirements in the current law will be strong enough to ensure that the principle that we all want—greater transparency—will be applied. Certainly, I accepted that and understood it, because I think we all shared the concern that “reasonably practicable to comply” could be a huge loophole and she assured us that that would not be the case. We also discussed in Committee the fact that the industry itself, the online industry, had produced the means to ensure greater transparency. I made reference to the Adobe briefing, which I think is really important. I think we are all at one in terms of what is required.
On the amendment of the noble Lord, Lord Hodgson, I agree with him completely that it is again providing the means to ensure greater transparency. Certainly, from these Benches, we support his amendment and if he decides to divide the House, we will support him.
Lord True (Con)
My Lords, the Elections Bill, let us not forget, will introduce one of the most comprehensive digital imprint regimes operating in the world today and I submit to your Lordships that whatever shortcomings they may feel, or however much further they want to o’erleap the ambitions of the Government, these proposals are about increasing transparency for voters and empowering them to make informed decisions about the material they see online. As the noble Lord, Lord Collins, said, there is much agreement on that point, but we cannot, I fear, support Amendments 58, 60 and 62 in the name of the noble Lord, Lord Clement-Jones, because they do not, in our submission, strike the right balance between increasing transparency and proportionate regulation of campaigning, while Amendments 61 and 65 would be highly difficult to enforce and would risk unduly stifling online campaigning and free speech, although I concede to the noble Lord that this matter will be further debated in the Online Safety Bill.
Regarding Amendment 58, it will not always be practical to display the imprint as part of the digital material itself; for example, as noble Lords have said, in a text-based tweet, where there is a strict character limit. This amendment would not give campaigners the limited, yet crucial, level of flexibility afforded by the Government’s regime and would thus risk unreasonably hampering their ability to campaign on some digital platforms. The above reflects the carefully considered and pragmatic approach we have sought to adopt. I know the noble Lord’s concerns; I appreciated the discussion we had and I understood where he was coming from. The perceived permissiveness of the guidance surrounding the Scottish digital imprints regime, in so far as it created a perceived loophole, was worrying him. I am pleased to confirm on the record here, as I said privately, that our regime will not operate in the same way.
The digital imprint regime that applies at elections in Scotland does not specify requirements regarding the location of the imprint, which is why the Electoral Commission’s guidance in Scotland was not prescriptive in this respect. However, our new regime does provide the necessary specifics on the rules regarding the location of the imprint. Campaigners will be required to ensure that their imprints are displayed as part of the material. Only when this is not reasonably practicable—this touches on my noble friend’s amendment—may the imprint be located elsewhere, but it must still be directly accessible from the campaigning material. Those who do not comply will be committing an offence. Furthermore, the statutory guidance we are proposing as part of our regime will provide practical directions to campaigners on how to follow the rules, including regarding the location of the imprint. This guidance will be subject to parliamentary approval, meaning that parliamentarians will be able to ensure that it provides sufficient clarity for campaigners to comply with the rules. I hope the noble Lord will be reassured by those points.
On Amendment 60, candidates and registered campaigners already have to detail their election spending in their returns and provide invoices for payments over a certain amount, including in relation to digital campaigning. These are then made available for public scrutiny. The Government have explained that this requirement on campaigners to submit more detailed invoices or receipts about digital activity would need to be looked at carefully, as the detail provided is determined by the suppliers themselves, not the recipient. It could therefore prove difficult and burdensome for campaigners to comply with these additional requirements.
Similarly, Amendment 62 would require all campaigners promoting paid political advertising, and not the online platforms, to maintain a library of those advertisements, with specified information, for at least 10 years. I understand where the noble Lord is coming from, but we have explained that in our view this risks adding an unreasonable burden on campaigners, particularly smaller groups that rely on volunteers, or groups that are established only for the lifetime of a particular campaign. It is also not clear that there is a sufficient case for regulation in relation to political advert libraries, given, as the noble Lord acknowledged, that major platforms such as Facebook, Google and YouTube already make available libraries of political advertising that they host.
My response to Amendment 61 will focus on paid-for political advertising, as defined by Clauses 41 and 42, rather than other electronic material, as defined by Clauses 43 and 44, given that other electronic material is relevant only to UK-based entities anyway, with the exception of registered overseas electors who have also registered as third-party campaigners. The Government agree with the principle that there should be strict limitations on ineligible entities overseas spending money campaigning during UK elections, including on digital advertising.
Clause 25 will already remove the scope for any legal spending by foreign or otherwise ineligible third-party campaigners above a £700 de minimis limit. This is a huge reduction, given that those same actors can currently spend up to £20,000 legally during the regulated period in England, or £10,000 in Scotland, Wales or Northern Ireland. Further to this, by requiring an imprint on all paid-for electronic campaigning material, regardless of where in the world it comes from, the digital imprint regime will already greatly improve transparency of political advertising from overseas actors. For any material that is published in breach of the imprint rules, the enforcement authorities are able to require the relevant social media platform to take down the material.
Strict controls on spending and clear transparency about origin are essential. But I cannot agree to a fast-considered and potentially disproportionate blanket ban on all political material from foreign actors within scope of the digital imprint regime. We would need again to examine carefully the implications and practicalities of enforcement and restrictions on freedom of speech to avoid any risk of unintended consequences.
I turn to Amendment 65. The Government remain concerned that this amendment includes no reference to intent and that the proposed new clause, as drafted, could criminalise unintentionally false statements. It could, therefore, be very broadly applied. It could also discourage people from raising any legitimate concerns for fear of a statement being considered false. This offence could potentially provide broad powers to clamp down on anyone who expresses genuine concerns about the process of an election. Overall, we believe that this clause could have unintended but potentially severe implications for freedom of speech.
I reassure the noble Lord that the Government take electoral disinformation and misinformation very seriously, but we believe that these are best addressed through non-legislative measures, such as the counter-disinformation unit to which the noble Lord referred and which was explained during our debate in Committee. Any regulation must be balanced with the need to protect freedom of expression and the legitimate public debate which is crucial to a thriving democracy.
The response on the face of the noble Lord, Lord Clement-Jones, is one of disappointment, but I thank him for his amendments. I hope that I have brought some clarity to the questions raised. I hope he feels able to withdraw Amendment 58, although I acknowledge that he will pursue certain matters on another Bill.
Finally, I turn to Amendment 59, tabled by my noble friend Lord Hodgson. The Government entirely agree that it is right that third-party groups campaigning at elections should be transparent and clearly identifiable. This is why the digital imprints regime will require recognised third-party campaigners to declare who they are when promoting relevant online campaigning material to the public, including but not limited to their websites. Where third-party campaigners use their websites to campaign, as defined by Clause 43, an imprint will be required. Promoters will be required to ensure that the imprint—or access to it—is retained as part of the material, if it is moved on. Where promoters comply with the digital imprint rules by adding an imprint in material displayed on their website, the imprint will be visible for as long as the material is available to the public online and remains in scope of the rules.
I know that my noble friend is not convinced that it is sufficient that third-party campaigners are already publicly listed on the Electoral Commission’s website. We believe that the current rules, supplemented by the new digital imprint rules, will provide increased transparency and identify recognised third parties. There are specific problems about the construction of this amendment, which I have discussed with my noble friend. As currently drafted, the amendment would create a new offence but does not specify a penalty for its commission or any statutory defences against the charge. Further, and I am sure this is entirely inadvertent, the amendment is drafted such that any website owned and operated by a recognised third-party campaigner—for example, a large charity which might have many different websites—would be captured, even if it were unrelated to the campaigning activities for which the third party is registered. It could lead to a disproportionate application of criminal liability. These proposals would need further discussion with third-party campaigners and potential enforcement authorities. Digital regulation is a complex area. Few have thought about it more than either the noble Lord, Lord Clement-Jones, or my noble friend. But these digital imprint provisions were consulted on publicly—twice.
My noble friend is not entirely enamoured of the letter I wrote to him recently to assure him that the Government will continue to keep the transparency of digital campaigning under review. I underline this commitment. I assure my noble friend and the House that I will ask my officials to engage with the Electoral Commission to consider whether my noble friend’s proposal could be included as best practice for third-party campaigners, which the House has agreed to secure, in the commission’s guidance.
With these assurances, I hope that the noble Lord, Lord Clement-Jones, will feel reassured to some degree by the clarifications that I have been able to give and withdraw his amendment.
Lord Butler of Brockwell (CB)
My Lords, I have added my name to the amendment of the noble Lord, Lord Rooker, and I really need to add very little to what he has said. It is very difficult to see why there should be opposition to a requirement that political parties should have
“a reasonable and proportionate risk-based policy for identifying the true source of donations.”
The Government’s answer to this, which the noble Earl, Lord Howe, gave in Committee, is that there has to be a balance. It is clear, however, that where the balance is now is not satisfactory, because, as the noble Lord, Lord Rooker, said, there have been a series of donations to all political parties that have been not to the credit of the parties, not good for their reputations and not good for the reputation for cleanliness of our politics.
As I understand the position, the Government have not ruled out acting on the recommendations of the Electoral Commission and the Committee on Standards in Public Life, but regard this as a complicated matter—perhaps it is—and need more time to work on it. If the noble Lord, Lord Rooker, seeks to test the opinion of the House, I will support him. I would be gratefully comforted, however, if not only the Minister but the spokespeople for the other political parties said tonight that they duly take this issue seriously and regard donations from foreign sources and people who want to influence our politics in an unhealthy way as a growing danger to our politics. If the spokespeople for the parties and the Government will say that they take this seriously, and the Government do not rule out acting on the recommendations of the Electoral Commission and the Committee on Standards in Public Life in due course, I will be very comforted.
Lord True (Con)
My Lords, I was thinking that others would wish to intervene, but that does not appear to be the case.
These are important amendments, but I shall not encourage anyone to think that the Government will accept them. The context is a shared concern about dirty money, a phrase that the noble Lord, Lord Butler of Brockwell, used. I do not think any Government have been stronger in response to the Russian invasion, or in bearing down on oligarchs, than this Government. However, following our robust debate in Committee, I am pleased that we are again returning to this important issue of political donations. I do listen to contributions of noble Lords and these debates will certainly serve as a key reference point for the Government as they keep rules on political donations under review, to ensure that they continue to provide an effective safeguard that protects the integrity of our political system. In that context, the Bill bears down very heavily on foreign donations and makes them much harder.
Turing to the specific amendments tabled by the noble Baroness, Lady Hayman of Ullock, and the noble Lord, Lord Rennard, Amendment 63 would remove the rights of overseas electors to make political donations. Amendment 69B would place a £7,500 limit on any donation or series of donations from overseas electors. I fear that many will not be surprised when I reiterate that the Government cannot support these amendments, as we intend to uphold the long-standing principle, first introduced by the Committee on Standards in Public Life itself in 1998, that if you are eligible to vote for a party, you are also eligible to donate to that party. These amendments would overturn that principle by removing the right of overseas electors to donate. Overseas electors are British citizens who have the right to vote and, despite what the noble Lord, Lord Grocott, said, the Labour Party has acknowledged that for many years. They are reasonable participants in our democracy. Furthermore, due to the interaction of Amendment 69B and the existing legislation, there would be no provision for either the return of donations exceeding the £7,500 threshold or the reporting of such donations to the Electoral Commission. This leaves a significant gap, which means that the amendment would simply not have the intended impact.
The Government do not support the proposal of the noble Lord, Lord Sikka, to which I listened carefully. It was fair for him to set out his case because he wishes to establish an independent committee to report on the creation of a foundation for democracy. The concept here, however, which is where agreement falls away, is that he submits that this body should be responsible for collecting all donations made to registered political parties and mandatorily allocating them based on membership and vote share at certain elections. The Government can find no justification for this amendment and believe it would place unreasonable restrictions on an individual’s freedom to donate to the political party of their choosing. It would go against the fundamental principle of allowing members of the public to get involved in our democracy by giving their support, be it at the ballot box, via a cup of coffee or via donations, to any party or parties that they choose.
Moreover, this proposal would risk disproportionately penalising smaller parties, which may not have such high levels of membership and vote share as the larger parties, but form an integral part of our democracy. Indeed, it is not clear to me how any new parties would emerge under the noble Lord’s system, as they would not be able to fundraise for themselves and would therefore struggle to get their message out to the public to encourage members to join and voters to support them in the future. The Government are therefore simply not convinced that there is a demand or evidence to support the noble Lord’s radical idea; nor do we think it necessary to establish an independent committee to come to this conclusion. Should other parliamentarians share the noble Lord’s view, the existing framework of parliamentary committees obviously provides an ideal place to consider the proposal further, so I urge the noble Lord not to press his amendment.
Next, I turn to Amendments 66 and 68, spoken to by the noble Baroness, Lady Bennett, and the noble Lord, Lord Sikka, which address a similar theme. Amendment 66 would seek to cap donations that any one individual or organisation can make to a political party to 5% of that party’s maximum campaign expenditure limit at the preceding election. This cap would apply to all donors, whether individuals or organisations, such as trade unions for example. What effect would it have on a large trade union donation?
Amendment 68 would require the Government to publish a report on proposals to establish state funding of political parties and limitations on private donations. In essence, the noble Baroness and the noble Lord are seeking the Government’s views on these two fundamental principles. I will underline our position.
First, fundraising is a legitimate part of the democratic process. Consequently, there is no cap on political donations to parties, candidates and other types of campaigner but, instead, strict limits on what they can spend on regulated campaign activity during elections. These maintain a level playing field in elections. In particular, the noble Baroness’s amendment has the potential to create a very uneven and complicated playing field. Under the proposal, each political party will have different amounts it can fundraise, given that spending limits are calculated according to the number of constituencies it contests. New political parties in particular, again, would be affected and this change could encourage quite unnatural growth, whereby new parties are incentivised to contest seats they have no intention of winning to give them a more competitive funding limit in the next cycle. I will not be drawn on what percentage of a party’s overall donation might be permitted because the Government simply do not accept that there should be such a percentage figure.
Secondly, there is absolutely no public support for expanding the level of public funding already available to political parties. The Government are not going to go down that road.
Finally, I wish to address Amendment 69, retabled by the noble Lord, Lord Rooker. This would introduce requirements, as he said, for registered parties to carry out risk assessments and due-diligence checks on donations. Only those with a legitimate interest in UK elections can make political donations and there are strict rules requiring companies making donations to be both incorporated and carrying out business in the UK. Parties must check that companies meet these criteria. It is also an offence to circumvent the rules through proxy donors—for example, an impermissible donor seeking to make a donation through a company that is itself a permissible donor. Political parties must already report all donations over a certain value to the Electoral Commission, which are then published online for public scrutiny.
The Government have heard the concerns that donors may seek to evade the rules and, in principle, the point of strengthening the system to provide greater levels of assurance on the sources of donations to ensure they are permissible and legitimate is important. Indeed, the Government recently published, ahead of introducing necessary legislation, the Corporate Transparency and Register Reform White Paper.
Reforms to Companies House will deliver more reliably accurate information on the companies register by introducing mandatory identity verification for people who manage or control companies and other UK-registered entities, providing greater powers for Companies House to query and challenge the information it receives, and introducing more effective investigation and enforcement powers for Companies House. This, in combination with a new power for the Companies House registrar proactively to pass on relevant information to law enforcement and other public and regulatory bodies, including the Electoral Commission, will indirectly support the enforcement of the rules on donations by providing greater confidence in the accuracy of the data held at Companies House, including when seeking information on UK-registered companies and other UK-registered entities that have made political donations.
The Government have not dismissed the fact that this is a significant area, which is why we are instituting these reforms to corporate transparency, but for the reasons I have outlined to the House on various amendments, I urge that noble Lords consider not pressing their amendments.
Baroness Bennett of Manor Castle (GP)
Before the Minister sits down, may I confirm what he said? I wrote down his words: “The Government do not accept that there should be a percentage limit.” On the percentage of contribution from one person or organisation to a political party’s campaign, would the Minister confirm that the Government believe it appropriate for 100% of the funding for a political party’s campaign to come from one source or organisation?
Lord True (Con)
My Lords, again, I think that is a false question. In our democracy an independent person is entitled to stand in a constituency, for a cause that he or she believes in, and may choose to fund that campaign. Nobody else may want to give any money. That would be an example of 100% funding of a campaign by a small campaign or individual. There are complexities here, and the fundamental position to stand on is that in free democracy, people should be able to make a contribution of whatever sort they choose, provided it is permissible and legal.
Baroness Hayman of Ullock (Lab)
My Lords, it has been very clear from the debate we have just had and the other amendments that have been discussed, as well as my Amendment 63, that there are some really broad concerns about political donations, electoral finance and the procedures and systems that underpin and manage this. I urge the Government to take away those concerns more broadly and consider how they may be addressed in the future.
In response to the noble Lord, Lord Butler of Brockwell, I thought I had made it really clear, both in Committee and in my opening remarks today, that we are very concerned about the potential for dirty money infiltrating and influencing our political system. If I was not clear, I am very happy to confirm that we do have those very deep concerns.
I thank the Minister for his very detailed response, but I disagree with him that the Bill makes it harder to make overseas donations. Instead, our concern is that part of removing the 15-year limit actually makes it easier for people from foreign locations to donate to our political system. We are concerned that often it allows very wealthy donors unlimited access to our democracy, through what we could see to be unprecedentedly large donations. That is our big concern with this and why we have put this amendment forward. To avoid that kind of outside influence in our democracy, the right to make those kinds of donations should be reserved for citizens actually living in this country.
As I say, I thank the Minister for his detailed response, but do not believe he has addressed the real concerns expressed by us and other Members who have taken part in the debate. Therefore, I wish to test the opinion of the House on my Amendment 63.
Lord Rennard (LD)
My Lords, elections and donations are about choice. People who have non-dom status choose not to pay their tax here and, while they have this status, they live abroad for more than nine months of the year. The fundamental question raised by this amendment is: should they be able to donate the perhaps millions of pounds which they save in taxes by being non-doms to a political party, for example, which might want to preserve that beneficial tax status for them? In other words, we might connect the two principles of being able to give millions to a party and benefit by not paying millions which other people might consider are owed in taxes.
There are a number of occasions in our debates when we say that what we are doing is asking the other place to think again. However, we are not, on this principle, asking the other place or even this House to think again. The legislation which said that non-doms should not be able to donate to political parties was passed by both Houses in 2009. So we are not asking anyone to think again; we are simply asking for the legislation, passed with the approval of both Houses, to be implemented. Since 2010, various excuses have been put forward as to why this has been supposedly difficult or impractical, even though it was approved by Parliament. Essentially, the excuse provided is that the HMRC says, “Well, all tax issues are confidential, so you can’t implement this”. However, a form of declaration accompanying any donation, saying, “I am not a non-dom, so I am entitled to donate”, might well suffice and fit the bill. If you were making a false declaration, that could be an offence.
However, I do not really accept the HMRC’s argument—or rather, the Government’s argument put forward on behalf of the HMRC. For example, when Parliament said that if you are a higher-rate taxpayer, you should not benefit from child benefit—which I think was a fair measure—you needed to sign a declaration to the HMRC saying, “Someone in this household pays a higher rate of tax, so I can’t receive child benefit”. Why, therefore, can you not sign a declaration saying, “Someone in this household is a non-dom and therefore cannot donate to a political party”?
This debate is really about some of the fundamental parts of the Bill. The extension of the right to vote beyond 15 years is not really going to extend voting rights for very many people. For the reasons I outlined at Second Reading and will not go through again, the postal vote system, needed by most people who vote overseas, is so slow that very few votes would count in a general election. However, through this Bill the ability to donate unlimited amounts of money is being extended to a lot of people, including non-doms. A little earlier today, when discussing a technical aspect of the Bill, the Minister kindly confirmed that the Government’s position is very much to maintain a level playing field at local constituency level and nationally. However, I do not believe that this is happening. This extension of the right to vote is more about the right to donate, and should not be applied to non-doms.
In December 2020, the Government said that they wanted to increase the national expenditure limits for political parties in a general election “in line with inflation”. In 2000, Parliament agreed that there should be a level playing field between the main parties in elections. The principle was very much that it had to be a level playing field, not that each of the parties should be able to spend up to £20 million. If we increase that £20 million limit, or thereabouts, by the rate of inflation since 2000, that is a 79% increase. Therefore, the national expenditure limit, if increased in line with inflation since 2000, would go up for the Conservative Party, for example, from almost £20 million to almost £36 million. Where is that extra £16 million going to come from? Much of it will come from overseas donors, many of whom are non-doms. I do not think that this appeals to the British sense of fair play, and it should not happen.
Lord True (Con)
My Lords, I fear that I am not going to be able to allow the noble Baroness to remain in her seat for the rest of the evening. The Government cannot agree to these provisions, which seek to bring into practice a provision from the 2009 Act regarding donations from non-resident donors. Noble Lords will recall that in Committee, my noble friend Lord Howe replied to the approach of the noble Lord, Lord Rennard, on this same uncommenced provision.
The Government’s position on the matter remains unchanged, but it is important briefly to place on record the reasons why. The Government have no current plans to bring into force the uncommenced provision, Section 10, regarding donations from non-resident donors. It would be extremely difficult to make the provision work, as the Electoral Commission warned in 2009 when the Bill was going through Parliament. The coalition Government, in which the noble Lord, Lord Rennard, was influential, did not implement it between 2010 and 2015. The fundamental issue is that it is not workable, given that an individual’s tax status is subject legally to confidentiality. It would therefore be difficult or even impossible for the Electoral Commission, political parties, which would face fines for this, and other campaigners accurately to determine whether a donor met the test set out in Section 10.
I acknowledge that the Labour Party has come forward. I do not wish to get into a debate about the Labour Party’s fiscal proposals—that is slightly outside the scope of the Bill—but I know that Sir Keir will send a thank you letter to the noble Baroness for having raised this issue. Our principle, basically, is that taxation is not the basis of enfranchisement in the UK. As a British citizen is able to vote in an election for a political party, they should be able to donate, subject to requirements for transparency in donations, which we have discussed. There is also a precedent whereby those who do not pay income tax rightly remain entitled to vote. A lot of low-paid people do not pay income tax, but they have a legitimate right to vote. I know that perceptions differ on this issue. I remind the House that on two occasions, in 2009 and 2013, the Electoral Commission warned about the practical implications of the policy. For these reasons, and because of the duty of confidentiality in taxation, which would have to be overridden by other legislation, the Government cannot support the noble Baroness’s amendment.
Baroness Hayman of Ullock (Lab)
I thank the noble Lord, Lord Rennard, for his support and for his excellent speech. I thank the Minister for his response, although I am sure he will not be surprised to hear that it is not a response that I am particularly happy with or happy to accept. This issue has concerned a lot of people in recent weeks and months, and the Government need to take the position of non-dom status very seriously and look at it again. On that basis, I would like to test the opinion of the House.
“Review of operation of Act
(1) The Secretary of State must, within the review period—(a) prepare a report on the operation of this Act,(b) publish the report, and(c) lay a copy of the report before Parliament.(2) In subsection (1), “the review period” is the period—(a) beginning with the fourth anniversary of the day on which this Act is passed, and(b) ending with the fifth anniversary of that day.”Member’s explanatory statement
This amendment requires the Secretary of State to prepare, publish and lay before Parliament a review of the operation of this legislation, not less than 4 and not more than 5 years after it receives Royal Assent.
Lord True (Con)
My Lords, I shall speak also to Amendment 69D. I believe both amendments are significant to the House and I hope it will reflect on their importance, because I know there are aspects of the Bill that have concerned Members on all sides of the House. The amendment establishes a statutory duty for post-legislative scrutiny of the Bill, something that has been asked for, certainly by the noble Baroness opposite.
We had believed, and I maintain, that it is standard practice to conduct post-legislative scrutiny of Acts following Royal Assent, but we have listened to the strength of interest in guaranteeing that scrutiny takes place which will go across the Bill and we have tabled this amendment requiring the Secretary of State to prepare, publish and lay before Parliament a review of the operation of this legislation, not less than four and not more than five years after it receives Royal Assent—in other words, in good time. We judge that this amendment supports the commonly shared aim of this House, and answers the recommendation made by PACAC, that the impact of the measures be assessed following implementation of the Bill.
The amendment also sets out that a report by the Secretary of State will need to be set before Parliament to allow debate and scrutiny of the operation of the Act, as your Lordships have asked. Amendment 69D is a minor and technical amendment necessary to state the territorial extent of paragraphs 25 and 26 of Schedule 1. I hope the House will understand that I wish to place on record in Hansard that I think this is a significant proposal from the Government which will allow and ensure statutory consideration and examination of the Bill as a whole if it is given Royal Assent. I beg to move.
Baroness Hayman of Ullock (Lab)
My Lords, in Committee I tabled Amendment 205 to ask the Government to include in the Bill a statutory commitment to post-legislative scrutiny of the Bill, as recommended by PACAC. I want to say very briefly how much I welcome the amendments that the Minister has just introduced and to thank him very much for listening to my concerns and the concerns of other Members of this House about the lack of pre-legislative consultation or scrutiny. The fact that this has been included in the Bill is extremely welcome.
Member’s explanatory statement
This minor and technical amendment ensures that the territorial extent of amendments to Schedule 1 to the Representation of the People Act 1983 made by Schedule 1 to the Bill is correctly stated.