Cyber Threats

Lord Borwick Excerpts

Thursday 18th October 2018 Lords Chamber

[Lord Borwick (Con)]

My Lords, it seems to me that cyber threats fall into two categories, which are separated by complexity: first, the highly sophisticated attacks, often those sponsored by foreign states; and, secondly, the simpler, basic attacks, often by individuals or small groups of hackers. No doubt we will hear that the large-scale, often global attacks are well fought off by our people at GCHQ, but it is clear that they have a vastly complex task to defend against this sort of problem. A large part of such defence must be deterrence, and I hope that my noble friend the Minister will be able to tell me that we have a sufficient number of people with the requisite skill sets working on this. I also believe that offensive capacity is of the utmost importance; much like nuclear capability, having it makes it unnecessary to use it.

A large number of attacks are pretty basic, such as the WannaCry attack on the NHS last year. I hope that the embarrassed senior managers who supervised the use of obsolete software that could easily be broken, but should have been updated, have been held to account—and that they have subsequently raisedtheir game. Press reports state that some of the machines that were attacked were still using Windows 95. Of course, when faced with intense lobbying from unions and staff, it is always a challenge for the NHS to choose to spend budgets on software over wage increases. But the WannaCry attack reportedly cost the NHS £92 million, which leaves a lot less money for services and indeed future wage increases. Such consequences ought to help managers to get their priorities right.

There is a problem developing that we ought to discuss: the proliferation of passwords, a point made by the noble Lord, Lord West. On a normal day, we may be asked for about 20 passwords and PIN numbers. It is unrealistic for us to keep to the system of a different unique password for each website, service and machine. Certainly, the Californian legislature recently legislated to ban default passwords on any internet-connected device. Anything produced or sold in California that can connect to the internet will come with a unique password, or it will default to require users to make a unique password when they switch it on for the first time. I understand from last weekend’s Sunday papers that the Government are asking the same of our systems. The idea that default passwords such as “admin”, “123” or even “password” are so widespread is obviously worrying, and I have passed on to the Minister a cringingly embarrassing example of this on the parliamentary estate. However, I feel that the solution may be at hand with new password generator programs. They generate complex, unique passwords for the user, and there are even free ones, which can easily be installed.

Regularly updating software is a basic security rule. That was why it was so disappointing to receive an email from the Parliamentary Digital Service customer relations team, as we all did on 21 September 2018, telling us not to update to the new Apple operating system. All that told me was that our people did not have enough time to test our parliamentary programs against the new standard, using the widely available beta programs provided for all other uses. Did we not try them out before the release of iOS 12, as everybody else did? Our digital team did a great job when the whole Palace of Westminster was attacked a few months ago, but such an email just says, “We’ve failed you”. In the future, I understand that the vast majority of updates will be done automatically overnight. Soon, advice not to update will be as silly as the advice to a car driver, “Don’t forget to count the number of tyres on your car before driving away”. Certainly, updates should be under the control of the user, not the manufacturer of the software. For a user, the very best defence against cyberattacks is to update the software when that is possible.

Housing and Planning Bill

Lord Borwick Excerpts

Wednesday 23rd March 2016 Lords Chamber

[Lord Borwick (Con)]

My Lords, I rise to speak to Amendment 102D. I declare many different property interests, both directly and through companies in which I have registered an interest. They comprise land directly held by me and by companies, and also land held under options in Sussex, London, Oxfordshire and Scotland. Many of these companies are in the process of developing land and some have planning applications outstanding. I am also a trustee of many charities with property interests.

I support Clause 145. It will do an enormous amount of good, even as drafted, but I am aware that some objectors have concerns with it. It seems they are worried that a “designated person'” will not only be able to process the application, but will have the delegated authority to actually make the planning decision. That would be concerning. So it may be worthwhile to explicitly state that it is not the Government’s intention to allow a designated person to decide the outcome of an application. The actual decision should be reserved for the democratically elected councillors, all as part of greater localism.

The Minister may say that this is clear enough from the existing drafting of Clause 145, but if so I would ask why so many different people have misunderstood it. My amendment, which is supported by noble Lords from three different parties, would save time in the long term. If there is confusion among objectors and developers now, they will simply waste time by misunderstanding the existing clause.

I respect the opinions of many noble Lords who would prefer that this whole Bill does not pass, but if it is to pass, they want it to be as clear as possible. I want it to pass, but I also want it to be as clear as possible. I therefore want to amend Clause 145 to make it explicitly clear that a designated person shall not have any power to determine a planning application.

[Lord True]

This is a useful amendment. Perhaps I am tempted to intervene by the rodomontade of my noble friend Lord Deben, who certainly seemed to me an admirable candidate to be a designated person advising on green applications. He would do it better than most, and I look forward to the opportunity that he was extolling.

I also speak as a leader of a blooming local authority which has tried to be creative. I remind my noble friend that my education department is now a social enterprise. I have no problem with privatisation. I do not follow that route at all—my problem with this is that I do not like law made in a hurry. The process here is bad; there is not enough opportunity for consideration.

[Lord Borwick]

Nine days?

[Lord True]

No—if the noble Lord had been here earlier, he would have heard that this came in at a very late stage in the Commons and was dealt with quickly, and this was the first opportunity your Lordships have had to discuss it. All I am saying is that that is inappropriate at this time and place.

The noble Lord, Lord Campbell-Savours, is on to a very pertinent point. I am not going to go into all the issues; we have not had long enough to discuss planning fees. Local authorities should be properly funded for performing this important function. Funding other bits of sticking plaster—effectively, in some ways, that is what it is—to do that is not going to answer that core problem of under-resourced statutory function.

My problem with this comes down to the point of decision. At the end of the day, that decision must be independent. We have a court system in this country which is full of privatisation. People are advised by private solicitors. Their cases are pleaded by self-employed barristers. There is nothing wrong with private operators. When we get to the point of decision and recommendation, the planning committee, as noble Lords who have attended or been members of planning committees will know, is like a jury in effect, although it has a quasi-judicial effect. Under this provision, one of the parties—the applicant—will very often be a powerful figure who will, in effect, be summing up for the jury. That is what is in the documents here: it is solely for the designated person to make a recommendation to the local planning authority how, in their professional opinion, the application might be termed. So a piece of paper goes to the planning committee with the word “recommended” on it in bold. Under this provision, the private operator, who has a link with one party, is the person who does that summing up to the jury. To my mind, that is the difficulty. I have no problem with private operators being involved, as long as the poor bloomin’ local authority is allowed to properly function in doing what it seeks to do.

I am sorry if I am now in the third minute of my speech. I know that brevity is the soul of wit although sometimes, as shown in parts of the speeches by the noble Lord, Lord Greaves, within longiloquence there can also be pearls of wisdom.

I am concerned about this provision. It allows another local authority to be designated to do the job for local authority No. 2. We are told that that is because one of those authorities may be inefficient. Now, any Government can do this, not only my noble friend’s Government but perhaps Mr Jeremy Corbyn’s Government or that of—I cannot remember; was it Mr Farron? The point is that any Government with a policy preference could say to a local authority that was compliant or friendly, or perhaps did not worry too much about the green side or the affordable side, “We will have an experiment. We will give the work of the authority that is being too green or too difficult with developers to another authority that does not worry too much about green issues, and let them do it”. So there is a risk of moral hazard there—political moral hazard, if you like—from the involvement of any Government. If this measure goes forward, that part needs to be thought about.

My next point comes from long experience of trying sometimes to get things done on a bloomin’ local authority in the public interest. Getting development done is difficult, and one of the reasons why is the suspicion among the public of the planning system. We are an incredibly uncorrupt country, with many high-quality public servants in many local authorities and central government. Still, how many times do people come up to me and say, “Oh, there’s something going on in your planning department. The thing is rigged”? They feel that the system is unfair and rigged against them. If we had a system where the powerful, as conceived, were trying to get something done and were advantaged by having someone working for them who could get to the point of giving the summing-up to the jury, that would increase suspicion of the planning system and would not improve it.

I say to my noble friend: I wish this had been thought out a little more. Perhaps this is too swift a timescale to do it on. However, if we are to go forward with involving much more private activity and competition—I am not against the principle of that, unlike those opposite—can we please think about those very vulnerable points in the process? I would not be quite as dramatic as the noble Lord, Lord Campbell-Savours; I think, rather, that it might sink or swim. Still, the points that I have tried in my rather halting way to put forward are extremely important.

We also have to be careful about the scope of the secondary legislation. When I look at Clause 145(4), I am surprised that the Delegated Powers Committee did not take issue with the wording:

“The regulations may … apply or disapply … any enactment about planning”.

That seems to be the ultimate Henry VIII power, even in respect of an experiment.

I say to my Front Bench: please be cautious. Do not be put off entirely from looking for experiment, as noble Lords opposite were saying. But please think about that process at the point of decision, the nature of engagement of the Government and of powerful parties and how that might be perceived, and the moral hazard and indeed the actual hazard that might arise.

Charities (Protection and Social Investment) Bill [HL]

Lord Borwick Excerpts

Wednesday 10th June 2015 Lords Chamber

[Lord Borwick (Con)]

My Lords, I declare an interest in that I am active in five charities—the British Lung Foundation, the Royal Brompton and Harefield Hospitals Charity, the Ewing Foundation, the Federated Foundation and the Science Museum Foundation. I am also on the campaign board of Historic Royal Palaces. All of them are well-run charities, but this Bill is about badly run charities and bad trustees, and I very much support it.

We saw this weekend what happens when charities focus on aggressive fundraising rather than on their objectives. Many have outsourced these functions, and they now give the impression that they are badly run charities. The Mail on Sunday videos showed cynical attempts to get every last penny from donors. Oxfam is one of the charities that outsourced fundraising in such a way. It aims to tackle poverty, but the company that it authorised to raise money clearly was not concerned about the financial situation of the 98 year- old pensioner whom they talked about getting money from in the video. If there was an equally aggressive focus on achieving the charity’s objectives, more might be done to actually alleviate poverty.

Charities such as Oxfam do not help themselves when they talk about things that do not seem to be in their remit. Oxfam, among others, produced lots of content during the last Parliament about austerity, including a mocked-up film poster of “The Perfect Storm”, featuring a list of coalition policies. The Charity Commission found that this,

“could be misconstrued as party political campaigning”.

We must also emphasise the number of great charities and good trustees. There are great things being done in smaller charities, and they are coming up with innovative ways to achieve their objectives and finance their activity. These things are usually being done voluntarily. Volunteers do what they do because they back the cause. They are paid only in pride, in thanks and in the satisfaction of a job well done. Every one of them is let down by bad apples, so such a scandal might tempt a volunteer to despair.

Bad faith in the charity sector is even more heinous for its effect on others, but can we do more than this? If it is pride that motivates the great volunteers, how can we increase the level of pride and the level of dedication that drives people to stand in the cold on street corners to sell poppies for remembrance? Recognition may be a good way. Two hundred and ninety-two people were given a British Empire Medal in the new year honours list, and they were largely people who undertake charity or community work. The great work done by honours committees to identify and locate these people should be applauded. The attention of the press may be on knighthoods for footballers, but a lot of valuable work is done much more quietly. As well as the main national awards, there are local ones, with mayors giving awards to people in their communities pulling our fractured society together with encouragement and faith that even more can be accomplished. I know that most volunteers are not doing their work for recognition, but all are encouraged by it.

At present there is no equivalent of a label such as “plc” for charities: no simple badge that they are registered and doing their job properly. I suggest that charities could put the letters “RC” after their name, standing for “registered charity”. There should, of course, be penalties for misuse of such a badge, and I do not know if “RC” is the right acronym. It certainly could be wrong for an Anglican Church charity. Others may have better ideas. Such a label would show the country that they are in the good category.

I do not want to stop government giving money to charities, as I feel that that kind of expenditure can often be better than other government expenditure. Indeed, there are very sensible arguments for the Government to ask a charity to deliver certain public services. It will often do it more efficiently and with more knowledge and compassion than state employees.

There is one group of particularly problematic charities: the “sock puppets”. These are organisations that receive a large proportion of their budget from government and use that money to lobby for even more money. A report from the Institute of Economic Affairs found that 27,000 charities are now dependent on government for more than 75% of their income. The report also found that the voluntary sector receives more money from the state than it receives in voluntary donations. That is astonishing. It creates huge problems because many of these charities lobby for more state intervention, higher taxes and more regulation. Perhaps most perniciously of all, many of these charities use taxpayers’ money to call for even more of it for themselves, so it was right that the previous Government took some action on this.

Back in February, Sir Eric Pickles MP announced that the Department for Communities and Local Government was to become the first government department to insert an anti-sock puppet clause in grant agreements. It is important that further steps are taken to tackle the sock puppets. There is a suspicion that Governments of all parties have form in encouraging some charities to lobby for particular policies. We all know the argument: politicians want to implement a policy, but there appears to be no demand for it from the public—but the politicians know that it is the right thing to do and believe that there must be a hidden demand for it, so they make that demand apparent by encouraging charities to lobby for the policy.

There is a host of differences between a well-funded charity, funded by the Government, and an individual helping people themselves. Should this difference be made clear by refusing the right of government-funded charities to be called an RC or registered charity, as I suggested earlier? I propose that government-funded charities should use, if they want, an acronym such as “GFC”, but be refused the right to be called registered charities. How could we define GFCs? Perhaps as charities that have 50% or more of their income coming from government. After all, fundraising from government is different from fundraising from individuals, and it has significant implications for integrity and accountability. Just as companies must understand and react to the needs of their customers, GFCs surely become creatures of government—perhaps even unconsciously. This should be apparent to all but sometimes is not so. Therefore, a GFC acronym would be an idea with merit. Does the Minister agree?

I am concerned that Clause 13, which adds a new Clause 292A, is too focused on defining the financial return element of social investments. It does not clearly enough explain or define the social impact element of social investments. That section of the Bill is devoted to explaining what is meant by “financial return”, which is only one side of the coin. It is perhaps even more important to define what kind of social impact the section has in mind when it comes to social investments. The only text on this issue at the moment is set out in new Clause 292A(2)(a), which talks about,

“directly furthering the charity’s purposes”.

That seems to cover programme-related investment, where an investment is exclusively an advancement of a charity’s purposes. I thought that this area of the law was reasonably settled.

I argue that what is needed is a statutory power that enables charities to engage in what the Charity Commission described as mixed-motive investments. There are investments that are justified on the basis of expected financial return and the extent to which an investment is expected to advance one or more charitable purposes of a charity in whole or in part. It is this form of investment that needs a clear statutory basis. That was clear from the Law Commission’s report on the issues. Would the Minister consider again whether the wording would permit the flexibility to make mixed-motive investments?

Lastly, I ask the Minister whether there is room in the Bill to deal with the problem of charities and community interest companies being treated differently from co-operatives and community benefit societies in the financial promotion regulations when raising social finance. A change to the legislation would enable charities to raise social investment capital from local communities.

Economic Leadership for Cities

Lord Borwick Excerpts

Thursday 11th December 2014 Lords Chamber

[Lord Borwick (Con)]

My Lords, I declare an interest in the register that my wife is the statutory Deputy Mayor of London and a local councillor in London. So I welcome this debate, and thank the noble Lord, Lord Shipley, as I know first-hand that great cities need great economic leadership.

I find it particularly interesting to debate this issue here in the House of Lords, where cities are perhaps underrepresented relative to the countryside. This is partly because of our age profile, as young people go to cities. But the truth is that the cost of houses means that many noble Lords cannot live in London. Indeed, the cost of living in cities is generally higher than outside them, partly because of higher housing costs. For that reason, the London living wage is higher than the minimum wage.

The Government’s emphasis is on building new garden cities; one to be built in Bicester was announced recently. I declare another interest in a property company building homes there. Garden cities will certainly have less air pollution than bigger city centres, where levels of dangerous PM2.5 particles are much higher. Perhaps we can give the Green Party some credit for helping us to focus on building new towns that will be cleaner and greener.

A city is only as good as its people and we have to ensure that the younger generations are capable of economic leadership so that our great cities compete globally. That is why I am so happy about the work being done to improve economic and business competence among young people. I have been very impressed by a fantastic charity called Young Enterprise, which does exactly that. It operates in nearly half the schools in the entire country, teaching children to operate small businesses. That is exciting because more young people should be encouraged to go out and get some real experience, take some risks and see how far their new ideas go. That way, we will be bringing through a much bigger and more talented group of people, with knowledge of economic leadership.

There are reasons why we are not yet seeing enough young people coming through with the right leadership skills. They should experience leadership in school. But between supply teachers, a lack of autonomy for good teachers, a wide variety of first languages and large class sizes, children do not get the leadership they need. It is extraordinarily difficult for a teacher to both teach the material and inspire the students. This is something that people just do not talk about enough.

We know that cities work well. They make people more efficient. As they get more efficient, they become more prosperous. Will cities become the new heartlands of Conservative voters? But what is a city? Could a whole group of people and businesses in the countryside connected to the internet operate as efficiently as a city—but without the traffic jams and bad air pollution that we suffer from in cities?

We know how important cities are for a nation’s economic growth. In the UK, cities occupy 9% of the land but provide 61% of the output. But do we need different economic leadership in each of our cities? If economic leadership means inspiring young people to contribute to the economy, I am thoroughly in favour of it. If it means the ability to come up with new taxes, I am against it. The most valuable economic leadership comes from the family. No economic leadership from any city could ever compete with taxpayers deciding what to do with their own money.

Energy: Fracking

Lord Borwick Excerpts

Monday 17th March 2014 Grand Committee

Asked by

[Lord Borwick]

To ask Her Majesty’s Government what assessment they have made of the report by the Centre for Policy Studies, Why Every Serious Environmentalist Should Favour Fracking.

[Lord Borwick (Con)]

My Lords, I declare my interests, recorded in the register, in a land company and as a trustee of the British Lung Foundation.

I have, at my own cost, visited Williamsport, Pennsylvania, in the United States. It is widely known as the heart of “Frackistan”—a place where shale gas extraction is growing apace. What I saw in Williamsport is a new city built to service a new industry, and beautiful countryside that was still beautiful. Behind the trees might be the top of a drilling rig, but when we went to the production site, there were only a couple of acres of stones. Only underneath them could you see the plastic membrane put down to protect the environment from minute spills that rarely happen. Such rainwater as falls on those membranes is prevented from seeping into the ground. Instead, it is gathered and used in the production process. At the natural gas well we saw, there was nothing much higher than five metres. It comprised a Christmas tree, a compressor and a meter hut for measuring the wealth produced in that site and put into the major gas pipelines that eventually flow into homes and factories. I am grateful to Anadarko for letting me see its site, its safety processes and the enormous efforts it pursues to prevent pollution. Those guys are working hard and succeeding to make sure no harm occurs.

When you think about fracking—pumping water, sand and chemicals into shale formations far below the Earth’s surface—perhaps you might think that it would involve a great deal more machinery, equipment and land space. However, it reminded me somewhat of Winter Wonderland, an amusement park that stands in Hyde Park for a couple of months around Christmas. It is put up in one of the most protected and lovely green spaces in the whole country, but the point is that Winter Wonderland is temporary and goes away pretty soon. There is noise, there are lights and there is extra traffic, but they go away and you would not even know the site was there. The same happens with a shale site. Once the initial flurry is over, the actual production phase is pretty benign. The intrusion stops but the wealth carries on.

The air quality in Shanghai today is rated at 155. That means it is classified as “unhealthy” and:

“Everyone may begin to experience health effects”.

In Beijing, air quality has recently reached levels of 551—extremely dangerous. This matters in the environmental debate on shale, because that bad air is largely caused by coal. Extracting shale gas seems to be the perfect way to mitigate global emissions while stimulating global economic growth. As the paper by the Centre for Policy Studies suggests, shale gas technology should be advanced as rapidly as possible and shared widely, to cut emissions and improve air quality.

I have known Professor Muller, one the authors of the CPS paper, for some years. He is a scientist, not a politician. Professor Muller is a physicist of world standing, receiving distinguished teaching awards from Berkeley. He assesses facts and then comes to a conclusion. He does not try to make his work embrace preconceived ideas. Professor Muller co-founded the Berkeley Earth organisation at the University of California in 2010, to examine historical temperature records. He returned to the base data, to check them without the hot air of politics. After much work, he concluded that climate change exists and that the levels of change are quite small. He also concluded that the change was correlated enough with the rise in carbon dioxide to say that it is manmade.

After extensive work, Professor Muller has shown in this CPS paper that shale gas extraction will actually reduce emissions. After all, global warming is a global problem: a tonne of Chinese CO₂ is as bad as a tonne of British CO₂. It is global warming, not British warming. Crucially, extracting shale gas instead of burning coal will also reduce the amount of harmful particulate matter 2.5 in the air. PM2.5s are tiny dust particles that penetrate deep into human lungs. The presence in the air of PM2.5 causes people to die: 75,000 a year in the US and 400,000 a year in Europe. Its levels still go unregulated in the developing world and it currently kills more people annually than either AIDS, malaria, diabetes or tuberculosis. Shale gas offers an opportunity to cut massively PM2.5’s presence in the air. If extraction expertise were shared, we also could see a big drop off in CO₂ emissions in the developing world.

There are many environmental concerns about shale but Professor Muller takes each one in turn and dispels them all. The first is that shale gas production depletes limited supplies of fresh water. However, shale extraction sites have lots of salty water reserves underneath, too. It is becoming standard, and cheaper, for brine to replace fresh water at all sites. Already in the US about half of the water used is brine.

The now famous short film “Gasland” highlighted another potential environmental issue—the “flaming faucets”. In the film the director, Josh Fox, is shown in the home of a landowner near a shale site igniting gas from a tap with a cigarette lighter. He later admitted that the taps were leaking long before shale extraction started.

Noted scientist Yoko Ono also chipped in with a series of adverts warning that,

“fracking makes all water dirty”.

The best way to combat pollution is to apply tight regulations and big penalties if any companies were to contaminate the Earth—much the same as happens now with companies supplying oil or natural gas.

Perhaps the most notorious environmental concern in the UK debate is that of fracking-induced earthquakes. The argument goes that if we start drilling under Blackpool, the whole of Lancashire will be rocking. However, let us not forget that earthquakes are recorded almost every day in the UK, and a brief glance at the list of the most recent events tells us that most of them occur at New Ollerton in north Nottinghamshire. It is a big coal-mining area. There was one there on Friday evening at 9.30 pm with a magnitude of 1.5, and across the UK there have been 38 in the past 30 days. The point is that energy extraction causes very minor tremors. In any case, the Government are ensuring safeguards that immediately stop extraction if tremors of 0.5 or more on the Richter scale are recorded. It may be that that level is too low because that is barely more than the shock felt from 10 Lords a-leaping.

Professor Muller has provided a robust environmental case for proceeding with shale extraction. However, he is not the only one. In 2012, the Royal Society and the Royal Academy of Engineering found that the health, safety and environmental risks of shale extraction can be managed effectively in the UK. We have a track record for extracting a lucrative natural resource with little environmental impact. For instance, people said that we would cause lots of environmental damage when drilling for oil in the North Sea but, with the right research and regulation, we managed it.

Rightly, the Government have promoted the power of localism. People should have the right to have a say on the factors that affect them locally. With drilling for shale, the community will certainly have a say. Those who are afraid should be reminded that the Health and Safety Executive and the Environment Agency can both put a stop to drilling, even if the council gives the all-clear. Throughout the planning industry, though, localism is limited by a duty to co-operate—one area’s localism must not ruin another area’s locality.

With shale, there will be a duty to co-operate within government—that is, among departments. The Treasury, the Department for Business, Innovation and Skills, the Department for Communities and Local Government, the Foreign Office, the Ministry of Defence and the Department for Work and Pensions should all work with the Department of Energy and Climate Change to get it done; they are all affected in some way. Energy security has an impact on the Foreign Office and defence. Europe imports about 30% of its natural gas from Russia, which has frightening implications. As Fraser Nelson remarked in the Telegraph:

“Of all the weapons in America’s arsenal, its new energy power is perhaps what the Kremlin fears most”.

Let us also remember that America’s shale revolution, which produces oil as well as gas, has allowed it to disengage from the Middle East.

The economic benefits could be extraordinary, which should interest the Treasury. There should be a surge in tax revenues and reduced costs in imports. As a deficit-cutting measure, it should be right at the top of the top of the list. For the DWP, shale gas extraction could create around 74,000 jobs, with geologists in Lancashire and mechanics in Sussex. Councils could see a surge in business rate revenue, too.

Shale gas is the sort of subject that this House excels at because it affects so many different government departments. The Select Committee report on ageing was another example of this. Our economics committee has been considering this subject, and I very much look forward to hearing its views. Perhaps there should be a Lords Select Committee study into the cross-departmental benefits of shale gas extraction, to ensure that this industry gets going as soon as possible.

Charity Commission

Lord Borwick Excerpts

Thursday 27th February 2014 Grand Committee

[Lord Borwick (Con)]

My Lords, first, I declare an interest as a trustee of four different charities, ranging from Deaf Education to the British Lung Foundation, all of which are to be found in the register, and I have been a charity trustee for 30 years.

The Public Accounts Committee concluded that:

“The Charity Commission has not regulated the charity sector effectively”,

but I think the committee’s outlook is too bleak. There is a new team leading the Charity Commission now, with William Shawcross taking over from the “Quango Queen”.

[Noble Lords]

Outrageous!

[Lord Borwick]

The search is under way for a new chief executive as well. It takes a long time to change the ethos of an organisation, to make a bureaucratic elephant tap-dance, or even to make the elephant head in the right direction at any speed. I have made a change in the private sector, changing an inefficient, lazy monopoly supplier into a tiger, but it took a long time and I got support, not criticism, from stakeholders. I am not sure that everything done so far has been perfect. Shawcross’s comments on the pay of CEOs of charities could have been better.

The charity sector has changed, moving from the saintly amateur to the professional. The commission has to change from working on the chief assumption that all players in the sector are honest gentlemen to the reality that, hidden among those saints, are occasional sharks. All regulators rely in part on the integrity of their subjects, and integrity is harder to find now than 20 years ago. We should compare the Charity Commission’s failures in spotting the Cup Trust as a cracked vessel with a similar failure—that of the Bank of England and the FSA to spot the “crystal Methodist” as a bad banker. After all, some politicians could not even tell there was a problem with the affiliates of a charity, even when they were employed as full-time legal officers. Is not the percentage of imprisoned politicians from another place greater than the percentage of bent charities?

I think there is another, hugely important issue that the commission must combat with time and resources. That is taxpayer-funded political campaigning. The problem starts with the Government. Over the past few decades, they have given state support to an increasing number of charities. The intention might be good, but the result is not.

Christopher Snowdon of the Institute of Economic Affairs has carried out extensive work on this issue. His research has shown that some groups are being set up to champion certain pieces of legislation under the guise of a charity pursuing its objectives. He rightly calls such groups “sock puppets”. They prey on the good nature and trust of the British public because government departments and councils are camouflaging themselves as benefactors. Snowdon found that a shocking 27,000 charities are dependent on the Government—or, more accurately, on taxpayers—for more than 75% of their income. That has to have a big impact on the independence of charities and their ability to criticise the Government of the day.

What shall we do to tackle this evil? A lot of the responsibility for fixing the problem lies with the Government, not with the Charity Commission. Any statutory funding should be restricted and should not be used to lobby politicians or engage in other political activity. These charities should also be subject to freedom of information legislation. Much effort was needed to put together the Transparency of lobbying, non-party campaigning and trade union administration Act. Perhaps now we need a new “lobbying by sock puppets” Act to deal with this issue.