Opinion Polling
Lord Bridges of Headley Excerpts(9 years, 5 months ago)
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The Parliamentary Secretary, Cabinet Office (Lord Bridges of Headley) (Con)
I am very grateful to the noble Baroness for that introduction. Sadly, no one has come to me asking for my services, although my son keeps asking me to partake in the National Lottery each week, as he is sure I can win. I also congratulate the noble Lord, Lord Lipsey, on securing this debate and am very grateful for the other contributions, which were very interesting. Indeed, this has been a very thoughtful debate, although a short one. I am delighted that we have risen above the sterile argument about regulation, good or bad, although I will touch on that.
The noble Lord, Lord Lipsey, has, as the noble Baroness said, extensive experience of polling and psephology, and I certainly cannot claim to rival that. However, he and I do share the honour—I think I am right on this—and probably the scars of having worked in the back rooms of Downing Street, only to be handed our P45s by the British people. My noble friend Lord McColl and I were there in 1997, so we all know what it is like—this could turn into a bit of a group therapy session—when you are desperately hoping that the polls are wrong but they turn out to be right; or, as in this case, not quite so right.
It strikes me that the noble Lord’s speech in this debate has focused on one particular aspect of opinion polling—the methodology—and in particular those polls that are deliberately designed to get the answers wanted by those who commission them. I do not want to get too much into the details around the ComRes issue; if your Lordships do not mind I would rather rise above that and just talk about broad issues.
Let me start by putting the noble Lord’s mind completely at rest by saying that this Government have indeed no plans to regulate opinion polls. I am delighted that there has been an outbreak of consensus on this point. Many of your Lordships would agree that statutory regulation is not the answer to the issue that we are concerned about: accurate opinion polling. There is widespread agreement that opinion polls lubricate political debate. They help to get that debate moving and to air views, and regulation of any form of opinion polling would put us on a slippery slope towards an unwanted intervention in free debate, benefiting only those with deep pockets who could afford their own polls, as my noble friend Lord McColl so rightly said.
Touching on a few of the points that I think we will discuss in tomorrow’s debate on the same issue, the power that a regulator would yield would be entirely disproportionate. It would end up sanctioning research which could then be portrayed as the official point of view. I have no idea how this would work during a general election. Would it be banned? Would the regulator be asked to adjudicate on which questions were permitted, the methodology and so on? Also, what is the scope of this regulator? While those of us within the bubble of Westminster are fixated on political polls, as I am sure your Lordships are aware the vast majority of pollsters’ business is with commercial entities who want to test what consumers think. Just think about this—you would have a cat food television advertisement that would read, “Nine out of 10 say their cats prefer it, as certified by the Consumer Research Authority, Cracom”, or words to that effect. That would be disastrous and a slippery slope. It would be unwanted regulation of business and bad for democracy. Is this necessary? I think not—but no doubt someone can produce an opinion poll to show whether it is.
As regards innovation, a number of your Lordships picked up on what I think is a key point. Regulation would threaten the debate and innovation on which polling depends. Polling is similar to that most dismal of sciences, economics. It was famously asked of the economics profession why it did not see the crash coming. Yet despite this collective failure, no one has yet called for statutory regulation of economists—not that I want to put ideas in your Lordships’ heads. This is because we understand that the technical problems inherent in economic forecasting cannot simply be regulated away. We know that improvement will only come through intensive research, open debate and rethinking of old assumptions. I would argue that it is just the same with the science of public opinion polling—a point that the right reverend Prelate the Bishop of Derby spoke eloquently about.
As the noble Lord, Lord Lipsey, well knows, this science is a far more complex business than simply phoning up random members of the public and asking what they think. Samples have to be weighted and there is no consensus about the best way to do this, obviously. Surveys have to take account of cognitive bias, and methodologies are constantly being tinkered with and adjusted. Indeed, there is a certain amount of competitive edge that companies have within that. I was particularly struck by the right reverend Prelate saying that asking someone how will they would vote days before a general election can have some bearing on how they actually behave when they enter the polling booth—picking up that little stubby pencil, their hand hovering over the box and then saying, “Actually, I am going to put my cross here”. To compare those two thoughts and those two reactions to the question is very difficult, and this is exactly what I hope the Sturgis inquiry into the last election is going to get to.
This brings me to the question of conflicting polls—one poll suggesting the public support something and another poll suggesting they oppose it. My response is, as a number of your Lordships have been saying, let us interrogate the methodology and debate the issue further, and then let the public decide. This, I would argue, is what freedom of speech and expression is all about. I strongly believe that the public—aided by a free press and vigorous debate in Parliament and elsewhere—can smell a dodgy poll. As the noble Lord, Lord Lipsey, said himself, the poll he is concerned about seemed to receive very scant coverage or mention in your Lordships’ House during the debate.
If people discover that a poll is dodgy, there are means of making complaints, as the noble Lord, Lord Lipsey, is now following. However, I would further argue that just as frightening from the pollsters’ perspective is the route that ends by being placed in the stocks of public opinion, and the shame of one’s work being lampooned and castigated by the public. Having read the weighty analysis of the poll on the parent embryo survey and what has been said about it, my strong sense is that this remains perhaps the best route to address the noble Lord’s concerns, despite what he says. It is not for me to say whether the self-regulatory bodies should do more, but if I were in their shoes I am sure that, in light of this debate and others about polling, I would want to take note of what the noble Lord is saying.
This brings me to self-regulation. I declare that in the private sector I did not just place bets, as the noble Baroness predicted, on what I thought a company might or might not do; I actually commissioned a number of opinion polls from reputable companies on issues that were of relevance to private companies. In my experience, great care was taken by pollsters to ensure that no question was seen to be leading or partial. Any suggestion from me or anyone else in the organisation I was representing that a question was, and it would be rejected and changed.
I endorse the comment of the noble Lord that the vast majority of opinion-polling companies abide by the rules and standards of the Market Research Society and the British Polling Council. One has to ask why these companies do so. It is clear that there is a simple reason: it is in their interests to ensure that their research observes the letter and, crucially, the spirit of the code of practice, and that they are seen to be asking balanced questions and presenting answers in an impartial way. Only then does their research command the respect of politicians, the media and, in turn, the public.
Furthermore, the industry fully understands that transparency and trust go hand in hand. Members of the British Polling Council must already publish their results in full, with the questions exactly as asked, a description of the sampling methodology, the raw unweighted data and, crucially, the name of the client commissioning the survey.
On the specific point the noble Lord, Lord Lipsey, has been addressing about the assembling of the questionnaires themselves, if he or anyone else who is interested cannot sleep at night they might to turn to the MRS’s guidelines for questionnaire design. It is a nice, weighty document of about 28 pages, which states:
“Members must take reasonable steps to ensure … that participants”—
that is, those who opinion pollsters are polling—
“are not led towards a particular point of view”.
This applies to the objectives of the research, and to structuring and writing questionnaires. I am sure these guidelines will be taken into account in considering the issue the noble Lord raised; as he himself said, let us see what happens.
Moving on, all this shows that like any other business or service, the polling industry’s prosperity is built on trust. If opinion polls are to be taken seriously, people—be they the public, journalists or your Lordships—must trust them. If opinion polls become a laughing stock, pollsters go out of business. Why would anyone commission research if they feel they cannot trust the results? This is why, as my noble friend Lord McColl and other noble Lords have mentioned, the polling industry is undertaking such a thorough investigation of what happened at the general election. It is in not just our interests but its own that it does this. It is just as concerned as everyone else to get to the nub of what went wrong. As has been mentioned, the inquiry’s first evidence session is tomorrow.
To my mind this is the right response to a poll failure—a transparent review of what went wrong, followed by innovation and experimentation. The methodology has to be, and be seen to be, robust so we all await the result of this autopsy with interest. I trust that the noble Lord will make his voice heard in this inquiry, and that it will be heeded. Furthermore, the noble Baroness made a number of interesting points about the inquiry taking on board experience from other countries.
Government regulation certainly would not solve many of the issues relating to methodology that the noble Lord mentioned. Regulating the industry would simply centralise the debate and decision-making process, with no guarantee that the challenges surrounding sample size, questions and so on would be overcome. A statutory regulator would be too slow and unwieldy to respond to the innovation and change brought about by big data, cognitive psychology and the digital revolution. Indeed, it would be an analogue solution in a digital age. Crucially, such regulation could—and in my view definitely would—stifle the very debate that opinion polls seek to inform. That is why government regulation is the wrong answer to the right question—a question about conduct and methodology. It is a question that the noble Lord has every right to highlight, and the existing self-regulatory bodies have every reason to heed. The Government do not plan to regulate the opinion polling industry. As Walter Bagehot wrote, and I am sure the noble Lord will say:
“The place of nearly everybody depends on the opinion of everyone else”.
Whether the decision not to regulate will have an impact on the place of government, I am not sure; I suspect we would need an opinion poll to find that out.
Civil Society
Lord Bridges of Headley Excerpts(9 years, 5 months ago)
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The Parliamentary Secretary, Cabinet Office (Lord Bridges of Headley) (Con)
My Lords, I am delighted that my first debate is on the civil society. I would like to echo all those who thanked the right reverend Prelate the Bishop of St Albans for tabling the Motion, and to thank him and so many others in the House for their extremely thoughtful speeches.
Churches across the right reverend Prelate’s diocese are involved in projects to make our society stronger, so I know how passionately he feels about this subject. I also pay tribute to others who have spoken in this debate, all of whom have contributed so much to communities across the country, be it to hospices, educational charities, health organisations or credit unions—the list is very long and varied. I hope that I can do justice to the many interesting points that have been made.
I would like to start with a quote about neighbourliness, which runs as follows:
“In our own life the intimacy of the neighborhood has been broken up by the growth of an intricate mesh of wider contacts which leaves us strangers to people who live in the same house … diminishing our economic and spiritual community with our neighbors”.
These words were written not in today’s Daily Mail nor in the Telegraph, but 100 years ago by the sociologist Charles Horton Cooley—a name I have to say I am not that familiar with—an American who was writing at a time of profound social change in America.
I quote this to echo a simple point made by the right reverend Prelate the Bishop of Rochester: throughout history, what some people have hailed as progress, others have seen as unwanted, corrosive and unsettling change, and for each generation the pace of change seems to accelerate and, with it, the sense of dislocation. Today the pace is indeed dizzying, as the noble Lord, Lord Kennedy, just said: the digital revolution, globalisation and the changing nature of our society are just three of the forces shaping our world. It is little surprise that once again many of us feel a sense of bewilderment and disorientation, especially at a local level, as the noble Baroness, Lady Barker, pointed out.
That is the backdrop to our debate today, and while I heed strongly what many have said about the problems facing our society, I cannot help but wonder sometimes whether we are succumbing to that very British disease of seeing the glass half-empty. I do not for a moment want to belittle the concerns that the right reverend Prelate the Bishop of St Albans expressed in his perceptive speech, which others have echoed in different ways—especially the noble Baroness, Lady Uddin, in her very eloquent speech. We in this House are not here to sweep problems under the carpet but to debate how they might be solved, yet I would like to slightly redress the balance and bring a little bit of sunshine into the debate.
First, on political tribalism, obviously there are divergent views about how we might run our economy, for example. But there are good cases where parties come together, such as the scrutiny given to the charities Bill, which I presented to your Lordships yesterday, or the National Citizen Service, which the noble Baroness, Lady Royall, mentioned. Yes, we need to get more people engaged in politics and involved in their communities. But let us not overlook the progress that has been made: 3 million more adults volunteered last year compared to 2009-10. I could cite many examples of this but will consider just a few.
The National Citizen Service has seen 130,000 participants. There is the hugely successful Community Organisers programme, training over 6,000 organisers to work in hundreds of communities up and down the country: or Code Club, a network of volunteers who teach coding in primary schools. On top of all that, obviously, is the kaleidoscope of charities that continue to enjoy the unstinting support of the British public, which the right reverend Prelate the Bishop of Rochester spoke eloquently about. Just last night, for example, as I returned home to Battersea, I came across hordes of runners who had taken part in the Race for Life—a sight which made me feel exhausted—in just another example of the big-hearted, generous spirit one finds in communities across the country.
Giving is up since 2009-10, with 75% of individuals giving to causes important to them. This is worth about £11 billion a year, making Britain one of the most generous nations on earth. So we should pay great tribute to the civil society sector, which over the past few years has remained resilient through difficult times. Supported by nearly £200 million of investment from government, huge numbers of organisations have had to transform themselves to be able to continue to deliver effectively in very different and fast-changing economic and social environments.
We should also acknowledge the transformation that the Government have made to improve regulation and simplify, where possible, the environment for charities. Here I pay tribute to the excellent work undertaken by the noble Lord, Lord Hodgson of Astley Abbotts, through his drive to unshackle good neighbours and deliver a valuable review of charities legislation. The right reverend Prelate the Bishop of Rochester made a point about the simplification of regulations. While we can and must consider how we address the challenges we face, we should not forget the good things that are already being done and we should always think about how we can do better still. The question is how.
Here I turn to the term “civil society”. Much ink has been spilled defining this term and theorising about it. The right reverend Prelate and my noble friend Lord Cormack both referred to Magna Carta. Here I dredge my brain and my history lessons, but I think that I am right in saying that the Magna Carta of 1225 as opposed to that of 1215 was granted by the King because he needed to raise extra cash and tax. This highlights in one’s mind the critical link between civil society and liberties on the one hand and economies on the other. As my noble friend Lord Griffiths of Fforestfach eloquently pointed out, strong civil societies are built on strong, enterprising economies in which low taxes encourage investment and reward hard work, in which the state does not crowd out nor overregulate private enterprise, and in which the fruits of labour are shared fairly and wealth creation is not despised but championed. These are economies in which jobs are created, giving people that all-important independence, a sense of worth and, above all, the freedom to follow their ambitions and realise their dreams. More than that, they are economies in which the state can truly afford to invest in schools and hospitals and help those in greatest need—economies in which people can afford to help others, not just look after themselves. I am not saying that without money individuals are devoid of a sense of charity, altruism and a wish to help others, but simply pointing out that in a prosperous economy, people have greater ability to help others and to strengthen the bonds on which a civilised society is built. Conversely, in an economy that goes bankrupt, it is the poorest who suffer most.
A strong economy is the bedrock of a civil society, but what are the bricks? I turn to the House of Bishops’ letter. I thought that it was a very good letter, and rather than dwell on the differences of policy—for there are some—I would rather focus on where we agree. There are many points on which I agree with the House of Bishops—indeed, my copy of the letter is well thumbed—but I will cite just three. The first is a point that the noble Baroness, Lady Prashar, focused on: Beveridge. The letter says:
“Beveridge understood that if the state is given too much power to shape society it will stifle the very voluntarism that prevents the state from being hopelessly overburdened by human need”.
How very true this is, and it is unfortunate that we did not heed those words more when they were written.
My second quote is:
“When law and regulation intrude too far into everyday life, they create a ‘chill factor’ where anxiety about the rules prevents people acting freely, sensibly or with wisdom, even in areas which are not, in fact, governed by official regulations”.
I say, “Hear, hear” to that as well, and it raises the very interesting points about the duty of negligence that the noble Lord, Lord Griffiths of Burry Port, made.
My third quote is:
“The Church of England strongly supported the Big Society”,
and its ideals,
“could still be the foundation for the new approach to politics, economics and community which we seek”.
I am delighted to read those words and will set out a few characteristics of such a society.
I will start with a slight caveat. I adhere to the principle that:
“Out of the crooked timber of humanity no straight thing was ever made”.
As John Stuart Mill warned us, large, grandiose plans to shape society may dwarf, maim, cramp and wither human faculties. Instead, we need to give people and the communities in which they live more freedom, more choice and more independence. Indeed, we need to buttress the tolerance and open-mindedness that the noble Baroness, Lady Neuberger, eloquently referred to, echoed by the noble Lord, Lord Anderson, while avoiding the pitfalls of multiculturalism that the noble and learned Baroness, Lady Butler-Sloss, spoke of.
What does this mean in practice? There are a number of aspects, but I will cite just a few. First, such a society is one where people, wherever they come from, have opportunities to get up and get on in life. What does that mean? A million more pupils are now being taught in good or outstanding schools. But this Government will go further, tackling those schools that are coasting or failing so that all our children get the best possible start. This includes being taught about our democratic system and citizenship at key stages 3 and 4, as I am sure my noble friend Lord Cormack knows, although I will peruse with interest his points about citizenship.
Secondly, such a society is one where more people have the chance to fulfil their talents. Some 2.3 million jobs and more than 2 million apprenticeships were created during the last Parliament. More women, lone parents and older workers are in work than ever before. Our aim now is to achieve full employment and create 3 million more apprenticeships.
Thirdly, a civil society is one where the less well-off are supported, while those who fall on hard times are helped back on their feet. In the last Parliament the number of households where no one works fell by more than 600,000, its lowest level in a decade. Now, with a tax-free minimum wage and a welfare system that rewards effort, we will create more opportunity for those who can work, while continuing to protect those who cannot. I was delighted to hear the views of the right reverend Prelate the Bishop of Rochester on this as well.
Fourthly, it is a society in which the Government are close to the people they serve. A number of your Lordships raised devolution. I say that free schools, local enterprise partnerships, elected police commissioners and local communities being given new powers over key community assets are all policies to strengthen ties and relationships between neighbours—bridging social capital, as the right reverend Prelate said and as the noble Baroness, Lady Royall, mentioned.
Next, while controlling immigration, we need to welcome and support those who come here to settle and who do their best to contribute to society. The noble Baroness, Lady Neuberger, made a number of eloquent points on this and I would be delighted to talk to her further. If I may stress one point to her, it is that the DCLG has an £8 million community fund to teach the English language, from which 33,500 adults have benefited.
Finally in my list, a civil society is one in which volunteering is encouraged and charities supported. Let me turn to a couple of specific points on that. My noble friend Lord Patten made a forceful intervention referring to big charities, and especially to their fundraising techniques. As he said, my honourable friend the Minister for Civil Society met with the self-regulatory bodies and made it clear that action must be taken, and quickly, to protect the long-term reputation of charities and address concerns expressed in recent days. As regards pay, that is a matter for charities’ trustees. They need to publish details in their accounts if senior executives are paid more than £60,000; that transparency will give the public the ability to decide whether to support those charities. Charitable trustees need always to bear in mind that it is upon the trust and generosity of the public that their future depends.
The noble Lord, Lord Judd, was absolutely right to point to the need not to overwhelm the charitable sector with new regulations. We need to get the balance right and I am confident that the new powers contained in the charities Bill are focused, targeted and proportionate. The third specific point, relating to community funds, was made by the noble Baroness, Lady Prashar. I can make no commitments as regards funding from this Dispatch Box but I intend to write to her about the very interesting points that she raised.
While rebuilding our battered economy, much has been done over the last five years to help strengthen our civil society. Let me give just a few examples. The Centre for Social Action is investing £40 million in high-impact social action projects driven by communities, seeking to work better with public services, including for people who need full-time care, the elderly and those who need support to live the final stages of their life in dignity. The Government have also created the world’s first ever social investment bank, Big Society Capital, unlocking more than £100 million of funding for communities at local level through Community First. As I mentioned, the National Citizen Service has seen more than 130,000 young people experience a programme of activity that has at its heart a message of individual responsibility, with more than 2 million hours of social action and 7,000 community projects stemming from this programme alone. As I also mentioned, one of the key aims of the charities Bill, which was debated yesterday, is to encourage charities to make more social investments that will deliver both a financial and a charitable return. Charities currently have more than £60 billion of assets, yet just £100 million of that is invested in such projects. This is a great opportunity for our little platoons to do more in their chosen fields.
So over the next five years, this Government would like to see more social action and volunteering, with community participation embedded in our lives from young people’s schooldays onwards. We would like: increased levels of giving and philanthropy; more businesses with greater sustainability at their heart; more social investment, enabling investors who want to use their money to have a profound social impact and deliver positive social change; and stronger, more resilient, more capable and more empowered communities, with a rebalancing of power away from government, enabling those communities to make more of their own decisions, shape their future and respond to the challenges that they face. But, where people need them, we would like better, more responsive public services, utilising the expertise of voluntary, community and social enterprise sector volunteers.
I end by thanking the right reverend Prelate the Bishop of St Albans for tabling this Motion. It has been a debate rich in insight and full of ideas as to how we can strengthen the bonds which underpin our communities. While we may disagree on some of the means, I think that we can all agree on the ends: a bigger, stronger, tolerant society, where communities seek fulfilment and well-being by each doing their bit; a society where communities are more resilient, capable and empowered; a society where people are encouraged to help others; and a society which has an active and diverse voluntary, community and social enterprise sector. This is civil society, built on the solid foundations of a strong economy, and I look forward to debating and discussing with your Lordships what more can be done to help foster this society in the weeks and months ahead.
Charities (Protection and Social Investment) Bill [HL]
Lord Bridges of Headley Excerpts(9 years, 5 months ago)
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The Parliamentary Secretary, Cabinet Office (Lord Bridges of Headley) (Con) (Maiden Speech)
My Lords, the House will be aware that I am now the Minister in charge of this Bill, rather than my noble friend the right honourable Lord Taylor of Holbeach. I am grateful to him for introducing the Bill when I was unable to. I am happy to assure the House that I, too, believe that the provisions of this Bill are compatible with the convention rights and would have been content to sign the necessary statement had I been in a position to do so when the Bill was introduced.
It is with the greatest sense of honour and humility that I stand before your Lordships today, and I also put my arguments to the House with some trepidation. Some 22 years ago, I was sitting in the Gallery of your Lordships’ House watching a debate on which I had written a brief for Conservative Peers. The noble Lord, Lord Williams of Elvel, had been passed a copy of my brief and proceeded to dismantle and shred its arguments one by one, with grace and charm, paying tribute to the brief’s author along the way. As they say in Sicily, it was nothing personal, just business. It made me realise the great contribution that this House makes to public debate by scrutinising policies and testing the arguments that underpin them. In our fast-moving world, where the digital revolution is accelerating the pace of change, the temptation to act quickly is greater than ever. Now, more than ever, we need the chance to deliberate, review and kick the tyres of policy—and that brings me to the Bill before your Lordships today.
Like so many of your Lordships, I am a trustee of a charity, the Foundation Years Trust. Set up by Frank Field, its purpose is to understand what more can be done to help disadvantaged children in the first, all-important years of their lives. Among my fellow trustees is the noble Lord, Lord Hall of Birkenhead. I mention that not simply to declare my interest but to observe that charities are organisations in which a sense of shared purpose overrides political allegiances.
Down the generations, long before Lord Beveridge and the foundation of the welfare state, people have formed little platoons to battle against the five giants of want, disease, ignorance, squalor and idleness, at home and abroad, overcoming great challenges, sometimes at risk to life and limb. Only today, I read that the readers of the Sun knitted, for the charity Loving Hands, an amazing 500,000 items of clothing for children in need around the world. Quiet acts of generosity like this show that charities still have a very special place in people’s hearts, at a time when the public’s trust in so many other institutions and professions has plummeted. A recent opinion poll revealed that charity workers are among the most trusted and respected in society today. I am sorry to add that, according to this poll, the least trusted in our society are government Ministers, narrowly beating journalists and bankers. Having worked in banking, in journalism and now in government, I am somewhat concerned about what this says about me.
Charities must earn the public’s trust and generosity. They must never take it for granted. The vast majority of charities know this full well and are run responsibly and competently. It is in their interests, and the interests of society as a whole, that the charitable sector is properly regulated. Furthermore, charities must have the freedom to innovate and find new ways of fulfilling their mission. That is the purpose of the Bill before your Lordships today: to strengthen the public’s trust in charities, and help charities to do more.
Before I outline the measures in the Bill, I would like to pay particular tribute to my noble friend Lord Hodgson of Astley Abbots. He has laboured hard, over a number of years, to help charities flourish. This Bill implements some of the recommendations from his thorough review of the Charities Act 2006. His insight and advice have proved invaluable, and long may his wise contributions continue. Likewise, I would like to thank the noble and learned Lord, Lord Hope of Craighead, for ably chairing the Joint Committee on the Draft Protection of Charities Bill, and other noble Lords on that committee for their helpful pre-legislative scrutiny. Many others in your Lordships’ House have also helped to shape this Bill today, and I am sure that it will provoke further debate. My door is always open to meet and discuss its measures.
The bulk of the proposals in the Bill relate to the Charity Commission’s powers. As I am sure noble Lords will know, the Charity Commission registers and regulates more than 164,000 charities in England and Wales. In 2013, following a high-profile regulatory failure, the National Audit Office reviewed the commission’s regulatory effectiveness. Its report found that,
“the Commission does not do enough to identify and tackle abuse of charitable status”,
and,
“is not regulating charities effectively”.
The NAO made a number of recommendations to improve the commission’s regulation of charities and to strengthen its powers. Further calls for stronger powers were made by the Prime Minister’s extremism taskforce and the Home Affairs Select Committee. When the NAO published its report, the previous Government published proposals to give the commission new powers. After public consultation, these proposals were refined and a draft Bill was published. Following pre-legislative scrutiny, further changes were made. Thanks to all of this and the contributions of so many noble Lords, the proposals have been well scrutinised and the Bill before your Lordships today is much improved as a result.
The measures in the Bill are, of course, just one strand of a much-bigger strategy to improve the commission’s regulatory effectiveness. The commission now has strong leadership; it has set itself new priorities; and it has received an additional £9 million over three years. This will help it move more of its services online and, crucially, bolster its capacity to identify and tackle abuse and mismanagement in charities. The NAO has followed up its report and acknowledged that good, early progress has been made.
However, there is no point in the Charity Commission working harder to seek out abuse if the commission cannot act effectively when it finds abuse. So the bulk of the Bill is devoted to ensuring that the commission has new or extended powers, of which I would like briefly to highlight five. First, a new official warning power would enable the Charity Commission to take a more proportionate approach to low-level misconduct and mismanagement. The Charity Commission already can and does engage with charities when this happens, but it finds that up to 30% of charities contacted fail to respond adequately to its guidance.
Secondly, the existing criteria, which automatically disqualify a person from being a charity trustee, would be extended to include people with unspent convictions for money laundering, terrorism offences, bribery, misconduct in public office and perjury, and individuals subject to a terrorist asset-freezing designation. Disqualification would be extended to senior management positions as well.
Thirdly, the Bill would give the Charity Commission a power to disqualify individuals whose conduct makes them unfit to be a charity trustee. The commission would be able to act subject to three tests: criteria would have to be met relating to the person’s past or present conduct; the commission would have to consider the person unfit to serve as a charity trustee; and the commission would have to be satisfied that disqualification was expedient in the public interest. The power is accompanied by several safeguards, including for the tribunal to consider the matter afresh on appeal.
Fourthly, the Bill would give the Charity Commission a power to direct that a charity be wound up following a statutory inquiry; and fifthly; trustees have been known to resign from a charity before the commission removes them, and then to become trustees of another charity. The Bill would close this loophole.
I know that, like me, your Lordships will want to be satisfied that there are appropriate safeguards governing the use of all these powers, so it is worth reminding the House that, under the Charities Act 2011, the Charity Commission has a duty to act in a way which is proportionate, accountable, consistent, transparent and targeted only at cases in which action is needed. Furthermore, the exercise by the commission of all of the proposed powers in the bill regarding trustees is open to legal challenge, principally by a right of appeal to the Charity Tribunal.
The second purpose of the Bill is to help charities to make social investments so that they can fulfil their mission in new and innovative ways. Traditionally, charities with money to invest have either sought to maximise financial returns or made grants to further their charitable mission. Social investment is different because it involves investments that both further the charitable mission and expect to generate a financial return. At present, charities have over £60 billion of assets under management, but just £100 million of those are in social investments. By clarifying the law and trustees’ duties, the Bill aims to give charities the confidence and certainty to invest in this growing sector. I should express my thanks to the Law Commission for England and Wales for looking at this point and recommending the new social investment power, which the Bill would implement.
To conclude, the charities in this country deserve our heartfelt thanks and support. They embody all that is great about our nation and bring out the best in our society: a generosity of spirit and a willingness to make sacrifices to help those in need. The Bill will strengthen the public trust and confidence in our charities so that they can do better still. I look forward to hearing your Lordships’ views, and I beg to move.
Charities (Protection and Social Investment) Bill [HL]
Lord Bridges of Headley Excerpts(9 years, 5 months ago)
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The Parliamentary Secretary, Cabinet Office (Lord Bridges of Headley) (Con)
My Lords, I thank all those who have spoken for their excellent contributions and for the kind words spoken about me. Clearly, the pressure is now on for me to live up to your Lordships’ expectations. I particularly thank the noble Lord, Lord Watson of Invergowrie, for his speech and for his contribution to the pre-legislative scrutiny of the Bill. The last few hours confirmed what I said at the start of the debate: your Lordships’ House is indeed a place for quiet but incisive scrutiny. Much more than that, it is a forum in which the voice of our nation’s “little platoons” can be heard. I counted more than 30 charitable organisations being represented by the speakers in this debate.
Taking a step back, it is clear to me that, thanks in very large part to those who spent so long scrutinising these proposals over many months, there is considerable support in this House for the principles that underpin the Bill and most of its measures. Let us not forget why these powers are needed. It was the independent National Audit Office that pointed to,
“gaps in the Commission’s statutory powers which were hampering its ability to regulate effectively”.
In the years since that report was written, many in the charity sector have supported the need for change, as my noble friend Lord Hodgson did again today. These powers need to be carefully balanced, as does the role of the Charity Commission, between being a regulator and an adviser, as the noble and learned Lord, Lord Hope of Craighead, said. Here again I pay tribute to and thank the noble and learned Lord—the Usain Bolt of charity law, as we are told to call him—for all he did in making that process so productive and worth while.
Lord Hope of Craighead
My Lords, it occurs to me that Usain Bolt suggests that we rather rushed our job. I think Mo Farah might be a better analogy.
Lord Bridges of Headley
I am brought up short. The noble and learned Lord is quite right: Mo Farah would be much better. Thanks to the noble and learned Lord’s hard work, and the work of so many others in this Chamber, I am pleased but not entirely surprised that rather than wheeling out the wrecking ball for this Bill, your Lordships have simply started to stick little pins into it before the House, to test, to probe and to clarify a little bit more. I very much welcome this, my first experience of legislative acupuncture, an experience I am told will leave me feeling invigorated, refreshed and revitalised.
Turning to address the points made, I hope to cover as many as I can, starting with some of the more detailed comments. The noble and learned Lord, Lord Hope, asked whether we could amend Clause 8 to make it clear that there are other circumstances in which a third party may be unable to comply with the Charity Commission direction. I am sympathetic to this point as we want the provisions to work effectively. We will need to look at this in some more detail before Committee, as we will other words such as “privy”, which I think the noble and learned Lord also mentioned.
My noble friend Lord Lindsay referred to the complementary role that standards and accreditation could play alongside the new powers proposed in the Bill in addressing governance and trustee issues. I agree and I welcome the work being done by the United Kingdom Accreditation Service and the NCVO to explore the potential that standards and accreditation have to offer in the charity sector.
My noble friend Lord Hodgson made a number of incisive points, as one would expect. He asked for the tribunal appeal rights to be consolidated and simplified. While recognising his point, it is important to note that not all Charity Commission decisions are subject to appeal and the existing table of appeal rights provides a useful checklist of what decisions can be appealed and who can appeal them. The Charity Tribunal itself has, I am told, not expressed concerns about it in practice. My noble friend Lord Hodgson also asked for time to implement the Law Commission’s recommendations. I am sorry to say that I cannot give any guarantees, but my noble friend knows that the Government will look favourably on deregulatory and simplification measures.
A number of comments were made about the social investment aspects of the Bill, and I am very encouraged and heartened by the interest that your Lordships paid to this. The noble Viscount, Lord Chandos, for example, made a number of perceptive points about social investment, as did the noble Baroness, Lady Kramer. I would very much like to meet with both of them to pick their brains, as they clearly have a lot of experience in this sector. I know that the noble Viscount sits on a number of foundations, and it is quite clear from the noble Baroness’s very eloquent speech that she, too, has a lot to offer.
My noble friend Lord Borwick made some very interesting points on the definition of social investment, including a slightly detailed point on mixed-motive investment. I will not detain the House on that point now but I would be delighted to discuss it with him, as I would with my noble friend Lord Bridgeman. As regards the naming of charities, a point which my noble friend Lord Borwick brought up, I simply point out that it is an offence to call yourself a charity if you are not; and as regards charitable income, charities must now declare income from central and local government in their accounts.
I turn to my noble friend Lord Moynihan’s remarks about independent schools, and pay tribute to the extensive and fantastic work that he has done in this area and on sports in general. He made some interesting points about the public benefit test. I would like to make it clear that charities already have to report on their public benefit in their trustees’ annual report. However, I would be happy to meet my noble friend before Committee to discuss the points that he has raised. Likewise, I would like to discuss the public benefit issue with the noble Baroness, Lady Brinton, who also brought this up in a number of ways.
Perhaps I may turn to some of the substantive points in the Bill itself. Clause 3, as noble Lords will remember, will enable the Charity Commission to take account of other relevant evidence of a person’s conduct in the context of a statutory inquiry into a charity. I think that the noble Baroness, Lady Barker, and the noble Lord, Lord Low, raised concerns about this. I would simply point to several safeguards on this point, and I shall do so quickly. First, there must be a statutory inquiry open and the Charity Commission must be satisfied that there is misconduct or mismanagement linked to the individual in that charity before it can rely on conduct from outside the charity in its decision-making. Secondly, when exercising its powers the commission must provide a statement of reasons which sets out the evidence it relied on in making the decision. This would include any evidence it relied on from outside the charity. Finally, there is a right of appeal to the Charity Tribunal in relation to the exercise of the commission’s compliance and remedial powers, ensuring judicial oversight of the exercise of the power.
The noble Baroness, Lady Barker, and the noble Lord, Lord Low, also referred to Clause 7, which contains a power to direct a charity to be wound up. As your Lordships will know, the commission’s usual practice is to restore a charity to health following an inquiry. However, in some very rare cases—and I stress they are rare—it would be more appropriate for any remaining assets to be transferred to another charity. The commission can already do that under existing powers, but now the commission will have the power needed for the shell to be wound up. This power is available only in the context of a statutory inquiry where there is misconduct or mismanagement, or risk to charity property. In addition, the commission must be satisfied that the charity does not operate, or that its purpose could be more effectively promoted if it were to cease to operate, and that the exercise of this power is expedient in the public interest. There is also a requirement for the commission to publish details of a proposed winding-up order and invite representations. A winding-up order can be appealed to the tribunal. So, there are a number of safeguards around that clause too.
Two points were made on Clause 9, which concerns the automatic disqualification powers that the Charity Commission is to be given. The noble Baronesses, Lady Hayter and Lady Barker, and the noble Lord, Lord Low, among others, raised this point. I am sure that we will discuss this further in Committee. As regards their wish for sex offences to be added to the list, I would simply say that there is an existing regime to ensure the suitability of anyone in a charity with unsupervised access to children and vulnerable adults. Whether they are a trustee, an employee or anyone else, they must all have had a Disclosure and Barring Service check. It would be impractical for the Bill to break down the charities type by type and prescriptively list criteria for automatic disqualification in each case. Charities should be trusted to make their own decisions on how suitable a potential trustee is when recruiting. Where charities fail to take their safeguarding responsibilities seriously, the Charity Commission can and does intervene to take regulatory action.
Baroness Hayter of Kentish Town (Lab)
Does the Minister accept that that occurs only after someone has been abused?
Lord Bridges of Headley
I would point out, if I may finish my point, that under the Bill the commission would also be able to rely on the disqualification power if a person’s conduct clearly made them unfit to serve as a trustee or senior manager of a particular charity or class of charities. The commission’s draft guidance on how it would exercise the disqualification power makes clear that it could be used in the circumstances. This is made clear on page 4, under paragraph (b)(i) concerning condition F. I know that we will probably return to this point in Committee, so I hope the noble Baroness will forgive me for going on right now.
Also as regards Clause 9, the noble Baronesses, Lady Barker and Lady Brinton, and the noble and learned Lord, Lord Hope, were among a number of your Lordships who raised the issues that counterterrorism legislation might have in this context. I have been fortunate enough to talk to a number of your Lordships about this point and I recognise that there is a concern for some charities operating in some of the most difficult parts of the world—not just the Middle East, as the noble Baroness, Lady Brinton, pointed out. However, I would point out that several government departments, including the Home Office, the Treasury and DfID as well as the Charity Commission and the Cabinet Office, are engaging with NGOs to understand their concerns and ensure that, wherever possible, they are given proper guidance.
In many cases there is already detailed guidance dealing with the points that were raised, and it may be a case where better signposting is needed. We are also not aware of any legitimate NGO worker who has been convicted in the UK under the counterterrorism legislation. Providing some sort of exemption for charities from aspects of counterterrorism legislation may sound attractive, but I would argue that it could create a loophole in the law that could be exploited by the unscrupulous—something which I am sure we would all want to avoid. I was particularly struck by the remarks made on this point by the noble Lord, Lord Green of Deddington, given his extensive experience in this area, and I thank him for his contribution.
The noble Lord, Lord Low, raised Clause 10, particularly as regards whether condition F in the proposed new section is too broad. This condition needs to be considered in the context of other criteria for the exercise of the disqualification power, namely the test of fitness that disqualification,
“is desirable in the public interest … to protect public trust and confidence in charities”,
and the safeguards relating to the operation of the power, including the right of appeal to the Charity Tribunal. The Charity Commission’s draft guidance on how it would exercise the power should provide reassurance that it will use the power only when there is a clear case for doing so; that the commission would clearly explain what it would take into account before using the power; and that in exercising the power, the commission would provide an explanation identifying the conduct in question and why it thought that the conduct met condition F.
I turn to some of the wider issues that have been raised. The noble Baroness, Lady Hayter, and a number of other noble Lords raised the tragic case of Olive Cooke. This was a very sad case and I start by paying my condolences to the family of Olive Cooke and pay tribute to her outstanding work in the field of charity, which the noble Baroness, Lady Corston, referred to. I would like to say here that the charity sector needs to move quickly and firmly to show that self-regulation works in the best interests of the public and that fundraising can set itself sufficiently high standards to meet public expectations.
Last week, my honourable friend the Minister for Civil Society met with three chief executives of the self-regulatory bodies. He made it clear that action must be taken quickly to protect the long-term reputation of charities. The self-regulation bodies agreed to pull together a plan of action that could be taken in the short term, together with plans to work on in the longer term. The FRSB published its interim report yesterday, and its findings and recommendations are being discussed at the Institute of Fundraising’s standards committee today—a point, I think, that the noble Lord, Lord Watson of Invergowrie, was referring to. Charities need to ask for funds, but that is not an inalienable right and it needs to be exercised responsibly, particularly if we are to protect public trust and confidence in charities for the long term.
A number of your Lordships raised the issue of charity campaigning, including the noble Baronesses, Lady Hayter and Lady Pitkeathley, and the noble Lord, Lord Watson. The Government have been consistently clear that charities have the right to campaign within the law and that this can be a valuable way in which charities can further their charitable purposes. The Charity Commission’s guidance, CC9, makes it clear that charity law recognises that campaigning can be a legitimate activity for charities and sets out the general principles. The Charity Commission keeps all its guidance under review to ensure that it remains relevant and up to date. The commission has monitored charities’ observance of the guidance during the election campaign and is considering the findings from that monitoring along with the impact of the lobbying Act and other issues relating to the current guidance. The Charity Commission will need to take account of any findings of the statutory review of Part 2 of the transparency of lobbying Act by my noble friend Lord Hodgson of Astley Abbots. If the commission considers revisions should be made to CC9, it has committed to say so publicly and to consult widely.
I turn to housing associations, right to buy and their charitable assets. The noble Baroness, Lady Hayter, raised the Government’s policy to extend right to buy. This, of course, is being taken forward in another Bill. The Government are determined that anyone who works hard and wants to get on the property ladder should have the chance to do so. There is indeed, as the noble Baroness knows, a precedent for housing association tenants accessing discounts to enable them to buy their own home. I believe many people exercised the right to buy their housing association home between 1997 and 2010.
Finally, a number of your Lordships raised the resources and role of the Charity Commission, including the noble Lords, Lord Low and Lord Watson of Invergowrie. I would make two points. First, on its resources, if we are to bring down the deficit, we need to make savings and efficiencies right across government, and that includes the Charity Commission. The Treasury has agreed a sensible settlement for 2015-16 with the Charity Commission, based on its forecast needs and focused on protecting its investigation and enforcement functions. The 2015-16 settlement also increased the Charity Commission’s capital budget by £500,000 to invest in a new digital online system for charities to file their annual accounts. This will improve the Charity Commission’s efficiency and help it to identify and tackle fraud and mismanagement. I also welcome the £8 million investment in the Charity Commission announced last October by my right honourable friend the Prime Minister. All this will help the Charity Commission refocus its regulatory activity on proactive monitoring and enforcement in the highest risk areas, such as the abuse of charities for terrorist and other criminal purposes, such as tax avoidance and fraud. Secondly, as regards supporting charities, I am confident that the Charity Commission will get the balance right between regulator and adviser, and I was heartened to read what the National Audit Office said in its interim report.
I look forward to debating and discussing these measures, and more, in more detail with your Lordships in the weeks ahead. As I said, my door is always open. That said, I would be grateful if your Lordships do not follow the example set by my formidable great-aunt, who was general secretary of the Women’s Institute during the Second World War. I am told that when she ran into some bureaucratic obstacle, she found that the best way of overcoming it was to harry Ministers by ringing them at home well before breakfast. That is something that I recommend your Lordships do not follow, as you may get my four year-old daughter, who is twice as formidable as her great-great-aunt.
This Bill is just one part of the Government’s programme to strengthen the fabric of our nation—one nation. In myriad ways, in every community across the land, charities are performing that vital role. Some are tiny, others enormous—together they are a golden thread, weaving together those who want to do their bit. The Bill will give the Charity Commission strengthened powers to tackle abuse so as to maintain the public’s trust in charities, and it will enable those who have to do still more to help those who have not. I thank your Lordships for all your contributions today and for the many months spent scrutinising the Bill’s proposals. I ask the House to give the Bill a Second Reading.