Baroness Neville-Rolfe
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(8 years, 7 months ago)
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“(1) This section applies where the expenditure of a trade union paid out of its political fund in any calendar year exceeds £2,000 in total.(2) The union’s return for that year under section 32 must give the required information (see subsections (2A) to (2E)) for each category of expenditure paid out of its political fund; and for this purpose—(a) expenditure falling within paragraph (a) of section 72(1) is one category of expenditure, expenditure falling within paragraph (b) of section 72(1) is another, and so on; (b) expenditure not falling within section 72(1) is a further category of expenditure.(2A) For expenditure falling within section 72(1)(a), (b) or (e) the required information is—(a) the name of each political party in relation to which money was expended;(b) the total amount expended in relation to each one.(2B) For expenditure falling within section 72(1)(c) the required information is—(a) each election to a political office in relation to which money was expended;(b) in relation to each election—(i) the name of each political party to which money was paid, and the total amount paid to each one;(ii) the name of each other organisation to which money was paid, and the total amount paid to each one;(iii) the name of each candidate in relation to whom money was expended (or, where money was expended in relation to candidates in general of a particular political party, the name of the party), and the total amount expended in relation to each one (excluding expenditure within sub-paragraph (i) or (ii));(iv) the total amount of all other expenditure incurred.(2C) For expenditure falling within section 72(1)(d) the required information is—(a) the name of each holder of a political office on whose maintenance money was expended;(b) the total amount expended in relation to each one.(2D) For expenditure falling within section 72(1)(f) the required information is—(a) the name of each organisation to which money was paid, and the total amount paid to each one;(b) the name of each political party or candidate that people were intended to be persuaded to vote for, or not to vote for, and the total amount expended in relation to each one (excluding expenditure within paragraph (a)).(2E) For expenditure not falling within section 72(1) the required information is—(a) the nature of each cause or campaign for which money was expended, and the total amount expended in relation to each one;(b) the name of each organisation to which money was paid (otherwise than for a particular cause or campaign), and the total amount paid to each one;(c) the total amount of all other money expended.”
The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills and Department for Culture, Media and Sport (Baroness Neville-Rolfe) (Con)
My Lords, I am pleased to return to debating this Bill, and am grateful to noble Lords for the constructive engagement and good progress that we have made. As a minor but important aside, I am sure that noble Lords will have noted that most of the clause numbers have changed and I am now addressing Clause 12—which was previously Clause 11—on political funds reporting.
In his speech on the first day of Report, the noble Lord, Lord Burns, asked the Government to come back with proposals that better balanced transparency, accountability and proportionality. We have given this careful consideration, including a very helpful discussion with the Certification Officer, which the noble Lord recommended. I will now set out our response.
Union reporting on political expenditure is not new. Unions already provide information about political expenditure in their annual return to the Certification Officer. Some do this well, providing detailed information. For example, the Communication Workers Union provides in its annual return to the Certification Officer a detailed breakdown of spend on political objects, including on elections, campaigns, affiliation fees and delegations to national and regional conferences. But others provide very sparse information, hence the need for reform.
Concerns were raised on Report about the potential burden of the Government’s proposed reporting requirements, and in particular the need to report expenditure on a bus fare paid to an individual union member. As I said, unions were required to provide details of all expenditure to all recipients in each of the categories in Section 72(1) of the 1992 Act once the £2,000 threshold was exceeded. This would have included, for example, any relatively small payment for an individual union member to attend a party conference. This was the concern raised by the noble Lord, Lord Burns, and, indeed, by the Certification Officer. I accept that this could have been onerous for trade unions.
Amendment 1 therefore seeks to provide a more proportionate level of transparency by removing the requirement to report on each item of expenditure for every individual. Instead, we now require them to provide only a total of expenditure in each category and to specify which political party, organisation or candidate has been paid. I will give noble Lords an example of how this will work in practice in relation to conferences and meetings. Rather than reporting the payments for travel to individual members to attend a party conference, the union will now have to report only the total expenditure on conferences for a particular political party in any given year. This is much more comparable to the best practice that some unions currently exhibit, and the Certification Office has told us that the amendment brings helpful clarity to reporting requirements. I hope that noble Lords will therefore agree that this is a sensible way forward.
My noble friend Lord Leigh of Hurley also raised concerns about whether it was clear that all expenditure from a union’s political fund should be reported annually to members. As I said on Report, I accept the principle of consistent transparency to which my noble friend referred. Therefore, Amendment 1 now provides that where political fund expenditure does not fall within Section 72(1) of the 1992 Act, unions should report on the total spend for each cause or campaign on which money was spent, or they must provide the name of the organisation to which money was paid.
Finally, government Amendment 3 is in response to the scrutiny of the clause by the Delegated Powers and Regulatory Reform Committee. This is the amendment that I said I would return to after withdrawing it on Report, so that it could be considered as part of a wider package. The committee noted that the power to substitute the £2,000 minimum threshold for reporting in this clause can be used not only to raise the amount but to lower it again to an amount of not less than £2,000. In the passage of time it may well become necessary to raise the threshold for reporting. However, if the Government in future, having raised the threshold, wish to revert to a lower threshold, the amendment would rightly require affirmative regulations and greater parliamentary scrutiny. This seems completely right.
I believe that the amendment improves the Bill and I commend it to the House. I beg to move.
Baroness Donaghy (Lab)
My Lords, I am sure the noble Lord, Lord Leigh, forgot to declare in his contribution that he was the treasurer of the Conservative Party. I support my noble friend Lord Collins’s amendment to the amendment. Of course we support transparency but Amendment 1 adds another section, which in our view is completely unnecessary.
Many years ago I chaired the general political fund committee of—I think it was NALGO then, before Unison came about—and the amount of information given was extremely elaborate. There was an annual report and a magazine. There was absolutely no doubt about where the expenditure went, and I have no doubt that that information is still communicated.
I just wonder why this “Lord Leigh clause”, as I think I am going to call it, is really necessary. It seems to me that it is the thin end of a wedge and could be utilised in future. Amendment 1 adds an unnecessary burden to the unions. Without proposed new subsection (2E), it would still provide all the information that the Select Committee asked for.
Baroness Neville-Rolfe
My Lords, Amendment 2 to government Amendment 1 seeks to reduce the level of transparency on all expenditure from a union’s political fund. Of course, during debates in this House noble Lords have referred to unions supporting various campaigns, causes or organisations from their political funds that are not clearly linked to the categories of expenditure under Section 72(1) of the 1992 Act. As I explained, we are seeking to make things clear.
The noble Lord, Lord Collins, whose knowledge of this area has been extremely helpful during the passage of the Bill, asked about the Certification Officer’s view on what I think has rightly been named the “Lord Leigh amendment”. The Certification Officer acknowledged that this may mean some additional reporting for some unions. However, he welcomed the proportionate approach and clarity of the overall package, and supported the change. I am also extremely grateful to the noble Lord, Lord Burns, for his support, given all the expertise he developed during his splendid committee inquiry.
The noble Lord, Lord Stoneham, asked—as he always does—about burdens, a point on which he and I tend to agree. I will write to him but I think the one-in, two-out rule applies to business costs and therefore on a point of detail may not apply, but I will certainly check that and write to him. What I would say is that in this amendment we are trying to get away from the bureaucracy and detail of the individual recording of bus tickets. That has been the whole point.
We are not seeking changes to the political arrangements in relation to expenditure by the Conservative Party, for example, or changes in the Electoral Commission rules. We have brought in an amendment which I think improves things, and agree with my noble friend Lord Leigh that better transparency is required across all expenditure from political funds to enable union members to decide whether or not to contribute and, importantly, that it does so in a clear and proportionate way. I believe that the package of amendments I have set out today achieves that.
Baroness Neville-Rolfe
I think the noble Lord, Lord Whitty, was seeking to make a parallel with the area of political donations, and I explained that this provision did not seem to have a parallel with the point that he was making. For that reason, I felt that we should leave the amendment as it is.
Lord Collins of Highbury
I appreciate the noble Baroness’s remarks, and I am going to repeat them, because I think the purpose of her amendment is undoubtedly to make things clearer. Certainly, defining the reporting mechanism in accordance with Section 72 of the 1992 Act is entirely appropriate. That is a good thing, and it is best practice. But this new subsection (2E) in the amendment—the “Lord Leigh amendment”—will not make things clear and will not make things transparent. It may have unintended consequences. There is no doubt but that all the expenditure of a trade union is properly accounted for. I will keep repeating that because there is a suggestion that if it is not reported to the CO or detailed in the AR21, the annual return, it is somehow not properly accounted for. It is properly accounted for, in the accounts.
As I say, when I went to the USDAW annual delegate conference in Blackpool, they went through the details and the sections of their report page by page and paragraph by paragraph, and questions were asked. The report gives a breakdown of the political expenditure. But the statute governing the nature of political expenditure is now being asked to cover non-political expenditure, as if that is somehow not accounted for somewhere else. This is a step too far and will lead to complications. With this detailed reporting, there is potentially a mismatch between the Electoral Commission’s information, which is published as the donations received by political parties, and the returns of the unions, which will talk about affiliation fees in separate years. There is the potential for some form of conflict there.
I accept that the original amendment addresses the concerns of the Select Committee, and totally accept that it is an attempt to make things clearer, but I am extremely disappointed that the Minister has included the amendment of the noble Lord, Lord Leigh, because it will just lead to further confusion. Bearing that in mind, I beg leave to withdraw my amendment.
“(3) The Secretary of State may by regulations made by statutory instrument amend subsection (1) by substituting a different amount, which may not be less than £2,000, for the amount for the time being specified in that subsection.(3A) Regulations under subsection (3) that substitute a higher amount shall be subject to annulment in pursuance of a resolution of either House of Parliament. (3B) No regulations under subsection (3) that substitute a lower amount shall be made unless a draft of them has been laid before Parliament and approved by a resolution of each House of Parliament.”
“Certification Officer not subject to ministerial direction
In section 254 of the 1992 Act (the Certification Officer), at the end of subsection (2) insert “(but is not subject to directions of any kind from any Minister of the Crown as to the manner in which he is to exercise his functions)”.”
Baroness Neville-Rolfe
My Lords, the Certification Officer has always been independent of government and I am happy to say that we fully agree that he should remain independent in future. That is why I am bringing forward Amendment 11 to state expressly in the 1992 Act that the Certification Officer is not subject to ministerial direction when exercising his statutory functions. Furthermore, as I mentioned on Report, we have agreed that, in future, appointment processes for the Certification Officer will be regulated by the Commissioner for Public Appointments. This will be reflected in the public bodies Order in Council when it is next revised in July. I believe that this fully addresses the House’s concerns, and I ask noble Lords to support the amendment.
“ Omit section 24C and sections 24ZH to 24ZK of the 1992 Act (which are superseded by the inserted Schedule set out in Schedule 1 to this Act).In section 25 of the 1992 Act (remedy for failure: application to Certification Officer) in subsection (6A), for “section 24ZH or 24ZI” substitute “paragraph 2 or 3 of Schedule A3”.In section 45D of the 1992 Act (appeals from Certification Officer)—(a) omit “24C,”;(b) after “45C” insert “or paragraph 5 of Schedule A3”.”
Baroness Neville-Rolfe
My Lords, Amendments 12, 13 and 14 are minor and technical amendments to Schedule 4. I promise not to detain the House for long as they are not changes of substance. Under the transparency of lobbying Act, the Certification Officer’s investigatory powers in relation to trade union membership registers are due to commence on 1 June. These amendments make the necessary consequential amendments to the 1992 Act. The practical effect will be the same. The amendments also address the Certification Officer’s powers to set the procedure in determining a complaint. He currently has the power to do this when he determines a complaint from a trade union member. For example, when dealing with a case, the Certification Officer determines what documents the parties need to provide, the timescales that need to be adhered to and how proceedings at a hearing will be conducted, in his own inimitable way. These minor and technical amendments will allow him similarly to regulate procedure in relation to any decisions he will be able to make without a complaint following the changes made in the Bill. I beg to move.
“ In section 256 of the 1992 Act (procedure before the Certification Officer), in subsection (1)(c), for the words after “declaration or” substitute “order under section 24B, 32ZC, 45C, 55, 72A, 80, 82 or 103 or under paragraph 5 of Schedule A3”.”
Baroness Neville-Rolfe
My Lords, as the Bill nears the end of its parliamentary journey, I want to take a moment to consider how far it has come since being introduced to this House last November. The Bill strikes a fair balance between the unions, whose work we all value, and their responsibility to society, especially to other working people—as patients, parents and passengers.
Noble Lords spoke eloquently about the case to change key aspects of the Bill, including on political funds, check-off and the Certification Officer. I am grateful for your Lordships’ active engagement and tireless commitment to finding an acceptable way forward on these matters. I want in particular to thank, on the opposition Front Benches, the noble Lords, Lord Mendelsohn and Lord Collins, and the noble Baronesses, Lady Smith, Lady Wheeler and Lady Hayter, and the noble Lord, Lord Stoneham, and the noble Baroness, Lady Burt of Solihull, for a very constructive approach. I have also valued the input from the Back-Benchers opposite and their advisers, and am pleased that the Government listened and responded and that the Bill is much better as a result.
I am also enormously grateful to many noble Lords across the Chamber for their passionate and intelligent contribution, especially to the noble Lord, Lord Burns—who sadly is not in his place—and the Select Committee on Trade Union Political Funds and Political Party Funding for the additional scrutiny and common sense that their work brought to this Bill.
Lord Tyler
Is the Minister in a position to tell us when the Government will respond in full to the recommendations of that Select Committee on which I served? It would be extraordinary if your Lordships’ House did have not a response before the completion of the whole process on this Bill. That would include all the recommendations of the Select Committee. She has referred to it as a splendid Select Committee; I assume she thinks all its recommendations are splendid, which would include not just the revised Clauses 10 and 11 but the link to discussions on party political funding. When will we get a response on that issue?
Baroness Neville-Rolfe
The noble Lord is, in his usual way, perhaps leaping to a conclusion I am not able to make, but I will take away what he said. The Bill will return to the other place and I will bear in mind the point that he has made, but I am certainly not in a position to respond today on the full panoply of the report. However, we have heard in this House how strongly people feel about all this, and the process, which was separate from the Bill, has been helpful in enabling us to edge forward on the Bill’s provisions.
I thank my noble friends Lord Bridges and Lord Courtown for their assistance and my noble friends Lord Sherbourne, Lord Robathan, Lord Callanan, Lord De Mauley, Lord King and Lord Leigh for their support, and of course my noble friend Lord Balfe, particularly for arranging for me to meet the smaller unions to complement my experience with larger unions such as USDAW, which has been mentioned today. That was a very important meeting. I express my appreciation to the noble Baroness, Lady Finn, for her support and expertise, and I thank the Bill team and my own private office for days and nights of hard work.
Once again, this House has demonstrated the huge value that its scrutiny adds to the legislative process and, as ever, I am pleased to have been a part of it. I look forward to returning this Bill to the Minister, Nick Boles, its main parent in the other place.