Deregulation Bill

Lord Hardie Excerpts

Tuesday 21st October 2014 Lords Chamber

[Lord Rooker]

The noble Lord has not said he is taking it back to the Government.

[Lord Hardie (CB)]

Can I clarify in my own mind what the argument is? As I understand the Minister, the justification for the clause is that it would meet the test of the Red Tape Challenge. However, I also understand that the burden of the power will still exist for a tribunal to make an observation in the same terms as a recommendation. I am struggling to understand how that does not impose upon the employer the same burden as exists at the moment. Perhaps the Minister could help me out.

[Lord Curry of Kirkharle]

My Lords, I will correct something that the noble Lord, Lord Rooker, has just said. The Red Tape Challenge process is not influenced by two environmental health officers. There is a robust process which follows up the public consultation process which is part of the Red Tape Challenge. There is a star chamber with Ministers, independent representatives and government officials who thrash out the various comments that have come through the Red Tape Challenge process, and which have eventually arrived as part of the Bill.

Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Bill

Lord Hardie Excerpts

Tuesday 5th November 2013 Lords Chamber

Moved by

[Lord Hardie]

1: Clause 1, page 1, line 5, leave out “carry on the business of consultant” and insert “engage in professional”

[Lord Hardie (CB)]

My Lords, in moving this amendment I also wish to speak to Amendments 4, 6, 46, 53, 59 to 62, 66, 79, 80, 87, 96, 98, 111, 116 and 117 standing in my name.

Part 1 of the Bill is confined to those who carry on business as consultant lobbyists. This amendment, and related amendments in my name, seeks to extend the Bill’s provisions to in-house lobbyists who endeavour to influence the Government about the matters specified in Clause 2(3). I suspect that the public do not distinguish between consultant lobbyists and in-house lobbyists. The present proposal for a register of those carrying on business as consultant lobbyists fails to address the equal concerns of the public about the activities of in-house lobbyists of major companies to which the noble Lord, Lord Norton of Louth, alluded at Second Reading. In other amendments which we shall discuss later I have suggested a register of lobbying activities. As the noble Lord, Lord Lang of Monkton, implied, a lobbying register might be more effective than a register of lobbyists. I have suggested both but if there is to be a register of lobbyists, it must be a register that includes in-house lobbyists if it is to have any credibility.

In introducing the Bill at Second Reading the noble Viscount the Minister acknowledged the role of lobbying in the policy-making process of our democracy. I agree, as did many other noble Lords at Second Reading, that lobbying undertaken in an open, transparent and responsible manner is integral to our democratic system. However, the noble Viscount also said that there had,

“been some concern … that some lobbying activity is opaque and there is a perception that certain powerful organisations and individuals could exert a disproportionate influence on government”.—[Official Report, 22/10/13; col. 893.]

It seems to me that in confining the register to consultants lobbyists the Bill fails to provide the necessary transparency in public life which will deliver to the public the noble Viscount’s promised offer of,

“greater confidence in our political system”.—[Official Report, 22/10/13; col. 892.]

It certainly does not dispel the perception that powerful organisations could exert a disproportionate influence on government. It does nothing to address that particular concern. Such organisations include major British and multinational companies involved in the tobacco, alcohol and gaming industries as well as energy suppliers, and many more listed by the noble Baroness, Lady Hayter of Kentish Town, at col. 897. Many of those organisations have in-house lobbyists and will not be subject to this legislation.

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[Lord Wallace of Saltaire]

My Lords, there was considerable concern while the previous Government were in office that consultant lobbyists were a powerful element in our political system, that we did not know who they represented and that it would be better if the public were informed who their clients were. The noble Baroness has, on a number of occasions, stressed the point that perhaps one should also add what subjects they are discussing with the Government. I am very happy to take that away and perhaps on a belt-and-braces principle that should be tied in. However, I do not think it takes away the issue that for transparency of the democratic process it is desirable to know who consultant lobbyists are representing and who therefore is paying them.

Perhaps I may move on to answer some of the questions. The noble Lord, Lord Campbell-Savours, asks what our assessment is of the number of lobbying organisations that will be required to register. Our current estimate is that it will be somewhere in the order of 350. We have held a number of constructive meetings with representatives of the industry at which we discussed the voluntary register and the code of conduct, and we have talked with the three main industry bodies concerned. They were able to give a reassurance that many of the concerns regarding the application are being met by that.

I turn now to the details. As I said to the noble and learned Lord, Lord Hardie, if the tobacco industry lobbies on behalf of its own industry, we know what is going on. If it is a consultant lobbyist lobbying on behalf of the industry, that is a great deal less clear. That is the underlying distinction between a consultant lobbyist and a professional lobbyist. Because I am concerned with the EU balance of competences exercise, over the past nine months I have read a great deal of evidence produced by the Scotch Whisky Association. I know exactly where the association is coming from and what it is lobbying about. If it were a consultant lobbyist, that would be a different situation. That is the distinction we are making.

On the question of whether we extend this to professional lobbyists, I cannot see the justification for excluding charities from it. As a Minister, I have met a number of charity representatives who have lobbied us on policy issues. That is quite properly a part of what charities themselves do.

[Lord Hardie]

Does the Minister not accept that charities would be exempt in terms of the schedule because what they do would be incidental to their other activities?

[Lord Wallace of Saltaire]

I am not sure that I do accept that. I am a member of the National Trust. Yesterday I received an e-mail from the trust which talked about the National Trust’s “vital” campaigning and advocacy work. I have to admit that I did not actually join the National Trust primarily in order to support its campaigning and advocacy work, but it regards that work not as an incidental part of what the trust is for. Noble Lords should look at the most recent announcement made by Oxfam. It is changing its internal organisation so as to put more stress on its campaigning dimension. Campaigning is at the centre of what Oxfam regards as its entirely appropriate charitable activities. Part of campaigning is, of course, lobbying Governments. I therefore do not accept that distinction.

We see the Canadian example as one that suggests overregulation, and therefore distinguish between professional lobbyists and consultant lobbyists. The noble Baroness, Lady Royall, and I were at a conference over the weekend. At one point we were both sitting with a senior executive from BP, and indeed one consultant lobbyist was there. I forgot to ask him precisely who his clients were, and perhaps I should have done. However, when you are talking to a representative of a company, you know who you are talking to and what you are talking about. I came away from the conference much better informed about BP’s involvement in the Southern Corridor pipeline project than I had been, and I trust that that will inform me in future discussions with those Governments through whose territories the pipeline will go.

Transparency is about knowing who these consultant lobbyists are representing. A number of amendments in this group address that point. The Government are not persuaded, but of course we are open to further discussions about particular areas where noble Lords feel that there is an overlap between consultancy and professional lobbying, although I do not entirely see how a particular lobbyist, being employed part time by five or 10 different companies, would somehow get around this legislation, as has been suggested.

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[Lord Wallace of Saltaire]

Organisations, I should have said.

[Lord Hardie]

I am grateful to noble Lords for their contributions to this short debate and to the Minister for his reply.

To answer the point raised by the noble and learned Lord, Lord Mackay of Clashfern, the definition of professional has been slightly widened over the years. I imagine that those who undertake lobbying activity for a living would probably prefer to be called a profession rather than a trade. Therefore, those who lobby, whether they are lobbying as employees on behalf of employers or as consultants, might be described as professional lobbyists.

As the Minister pointed out, consultant lobbyists might well have only one client, although that might be a rare case. Indeed, the Bill itself recognises that the consultant is a person who,

“makes communications … on behalf of another person or persons”,

so the singular is certainly envisaged.

I am grateful to the Minister for his response and want to reflect on his comments about charities and the exemptions—if they are exempt. I note that he said that he is open to further discussion and that the Government will look in response to the noble Lord, Lord Wigley, at possible further extensions without further legislation. Those matters ought to be and will be explored between now and Report. I may come back at Report with a more focused amendment, but, in the mean time, I beg leave to withdraw the amendment.

Amendment 1 withdrawn.

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[Lord Campbell-Savours]

My Lords, my amendment would inject the words “of government” after the words in Clause 1(1):

“A person must not carry on the business of consultant lobbying”.

I should make it clear that I am amending a part of the Bill which I believe in principle to be totally inadequate to deal with the problem of the lack of transparency; I am only amending what is on offer.

Amendment 3 would clarify in the first clause of the Bill exactly the intention of the Government behind the legislation. The Bill restricts its remit and reach to limited areas in the institution of government. My amendment would make it clear that at this stage, the Government’s intention has been deliberately to exclude other important areas of government influence over public policy and decision-taking from the reach of the Bill. I tabled this amendment last Thursday to draw on the wider debate about those bodies that were being deliberately excluded—namely, government in its wider form, and Parliament—since when, on Friday, my noble friends Lady Royall of Blaisdon and Lady Hayter of Kentish Town tabled their Amendments 18 and 22, which more roundly deal with the issue of Parliament. I therefore yesterday withdrew the reference to Parliament in my amendment and will leave that to them to deal with.

My amendment would bring under the Bill government as a whole, as against the cherry-picked sectors which the Government propose. My case is that executive agencies, which are staffed by civil servants, non-departmental public bodies, which are staffed with a mix of non-civil servants and civil servants, and non-ministerial departments are all crucial parts of government.

The document Categories of Public Bodies: A Guide for Departments, of December 2012, sets out each of the three areas of government to which I have referred. Non-ministerial departments are described as,

“government departments in their own right—but they do not have their own minister”.

They include the Charity Commission for England and Wales, the Food Standards Agency, HM Revenue and Customs, the Office of Gas and Electricity Markets, Ofsted, the Office for Standards in Education and Children’s Services and Skills, Ofwat, the Office of Water Services, and the UK Statistics Authority.

Executive agencies are defined in the document as,

“business units headed up by a chief executive … often supported by a management board. Executive agencies carry out executive functions, with policy set by ministers”.

They include HM Courts and Tribunals Service, the Identity and Passport Service, the Maritime and Coastguard Agency and the UK Border Agency. Finally, there are non-departmental public bodies, which are described as carrying out,

“a wide range of administrative, commercial, executive and regulatory or technical functions which are considered to be better delivered at arm’s length from Ministers”.

All these bodies are part of government and deal with contracts as set out in Clause 2(3)(c)(i). Some deal with grants and “other financial assistance”, as set out in Clause 2(3)(c)(ii), and some grant licences and other authorisations, as set out in Clause 2(3)(c)(iii). In other words, they are very much at the heart of government and carrying out the functions described in the Bill, and which the Bill is intended to catch. My amendment, which at this stage is a probing amendment, asks the Government why these bodies are to be excluded. I beg to move.

[Lord Hardie]

My Lords, I shall speak to Amendment 24, which is in this group. In doing so, I wish also to speak to Amendment 52 and, with the leave of the House, Amendments 56, 57 and 58, which are in a different group but are all consequential on the main amendment.

Clause 2(3) applies only to communications to,

“a Minister of the Crown or permanent secretary”,

second Permanent Secretary or persons serving in government offices as listed in Part 3 of Schedule 1. My amendment seeks to extend the class of persons. As many noble Lords observed at Second Reading, lobbyists will not confine their activities to Ministers or the senior civil servants listed in these provisions. Indeed, their involvement with such people is likely to follow lobbying activity involving civil servants of a lower grade. This is clearly the case when one considers the word “government” in paragraphs (a) to (d) inclusive of Clause 2(3), which has to be construed in accordance with paragraph 1(4) of Schedule 1. That construction extends the definition of consultant lobbying to Ministers or their equivalent, and officials at the highest level in devolved Governments and local authorities in the United Kingdom, and in any institution of the European Union.

When I was in practice at the Scottish Bar, I was initially standing junior to the City of Edinburgh Council then, when I was appointed Silk, I became standing senior to that authority. From that experience, I am aware that local authority officials of a lower grade than senior management prepared policy documents for consideration by senior officials, then elected members. Those junior officials had considerable expertise within their own professional competence and a significant influence on the terms of policy documents that were ultimately submitted to elected members. Any lobbyist worth his salt who wished to influence policy would communicate with these officials at an early stage. I suspect that the same is true in central government and devolved Governments in the United Kingdom. If this provision is to be of any significance, it should be extended to include communications with any civil servant. Equally, there is a perception that political advisers can have a significant influence on government policy. Why should they not be included in the definition of persons to whom communications are made?

Amendment 34 sets out the definition of “political adviser” but, on reflection, the approach taken in the amendments by the noble Lord, Lord Norton of Louth, and the noble Baronesses, Lady Royall of Blaisdon and Lady Hayter of Kentish Town, is more appropriate in referring to “special advisers”. That avoids reinventing the wheel.

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[Lord Hardie]

I support this amendment, and I hope that the Minister will see his way to coming forward with an amendment on Report to give effect to this. This may well not only meet the concerns of the noble Lord, Lord Norton of Louth, but also the suggestion by the noble Lord, Lord Lang of Monkton, at Second Reading that an easier and perhaps more effective approach to lobbying issues might be to require the person in government who is lobbied by discernible commercial interests to declare that in a lobbying register. That would perhaps go slightly further than the amendment, but I think the amendment meets the concerns expressed then. The amendment would have the added advantage that it would enshrine in statute this admirable initiative taken by the Government so that it would apply not just to this Government on a voluntary basis, but to all future Governments so that Ministers would be obliged to disclose their activities and they would appear alongside the details in the register.

[Lord Martin of Springburn]

My Lords, I am slightly worried about the speed which is being talked about by the noble Lords, Lord Kerr and Lord Tyler. I have no objection to getting up-to-date information but, if I understand correctly, we are talking about the information going out the following day. There have to be security implications. When I held of the office of Speaker, I was warned that there are fixated individuals who watch, stalk, make a pest of themselves and can be even more dangerous than that. The information would not only show up who the Minister was meeting but could well show up the venue, the place where the Minister was meeting. If it showed on a regular basis over a number of weeks that a meeting was taking place at a certain venue—let us say that the Minister by preference wanted to meet in his or her native city and said, “Make it a Friday at my constituency central office”—it could throw up a pattern of where the Minister was every Friday or every Monday for that matter, before they moved down to Westminster. I put that in as a word of caution. If the information says that the Minister met a representative from BT or Centrica, I would not be too unhappy, but if it showed a Minister meeting at a certain venue, I would worry about that.

Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Bill

Lord Hardie Excerpts

Tuesday 5th November 2013 Lords Chamber

[Lord Aberdare (CB)]

My Lords, I support Amendment 115, tabled by the noble Lord, Lord Norton. If the Government are not willing to go for a comprehensive register covering a wider range of lobbyists and those who are lobbied than currently envisaged, this seems a much simpler and more sensible approach that will be cheaper for the public purse and for the relatively small number of consultancy companies that would otherwise have to bear the not-insignificant costs of the registration system.

[Lord Hardie (CB)]

My Lords, I welcomed the amendment of the noble Lord, Lord Tyler. The amendment of the noble Lord, Lord Norton of Louth, goes further and I welcome that even more. In Amendment 81 I go even further. Noble Lords will see that it would introduce a register of lobbying activities. It gives statutory effect to the welcome initiative of the Government in requiring Ministers and Permanent Secretaries to publish on a quarterly basis details of meetings they hold with external organisations. This statutory register would ensure that this practice continues under future Governments. It would also include details of lobbying activity submitted by lobbyists. The public would obtain from this register a clear picture of lobbying activity within any quarter.

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[Lord Wallace of Saltaire]

My Lords, as regards my noble friend’s reference to the Canadian system, the Government consider that that system is onerous, expensive and more than we need. My task in Committee and on Report is to convince this House that the proposals in the Bill are proportionate and provide additional transparency. However, I will check and get back to my noble friend on how many of the current lobbying companies on the voluntary register publish their clients’ names, as that is clearly an excellent question that deserves an answer.

[Lord Hardie]

I would like to clarify the following point. First, does the Minister accept that there would be benefit in enshrining in statute in some way—whether by accepting the measure proposed by the noble Lord, Lord Tyler, that proposed by the noble Lord, Lord Norton of Louth, or my extreme proposal for a new clause—the practice that the Government have introduced of disclosing information to the public? The Government could claim credit for that initiative and could ensure that future Governments of any colour would be bound by the statute unless they sought to amend it. Secondly, can the noble Lord tell me what consideration the Government have given at any stage—either before the introduction of the Bill or after Second Reading—to creating a lobbying register?

[Lord Wallace of Saltaire]

I apologise to the noble and learned Lord; I should have answered his question about the noble Lord, Lord Lang. I am not aware that the Government have investigated that issue in detail but I will write to the noble and learned Lord as soon as I have the answer.

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[Lord Hardie]

I am sorry; the noble Lord has not answered my first question: namely, whether he sees any advantage in enshrining the good practice to which I referred in statute.

[Lord Wallace of Saltaire]

Let me take that away and speak to the noble and learned Lord further. I understand his concerns and I am very grateful for the detailed interest that he is taking in the Bill. We will make sure that we have adequate answers for him.

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[Lord Norton of Louth]

My Lords, I will be very interested to see whether anyone reports the words of the noble Lord, Lord Martin, about the Press Gallery.

I rise to support the amendment of the noble Lord, Lord Campbell-Savours, because he makes a very important point—I am surprised that it has not come up more in our discussions on the Bill—and that is this point about a kitemark for lobbying firms. Lobbying has always been a contentious activity. When I was writing about lobbying in the 1980s I made the point then that quite often the problem is not in the relationship between the lobbyist and the parliamentarian. Parliamentarians know perfectly well when they are being lobbied and essentially where it is coming from and can assess what is happening; if you like, they know the quality of the lobbying. The real problem, I argued, was between the client and the lobbyist, because clients would not necessarily know the quality of the firms they were employing to make representations. Lobbying firms are very good at making grand claims for their success rates.

Therefore, there is an issue of lobbying firms wanting to portray themselves in a certain way. My concern here is the one made by the noble Lord, Lord Campbell-Savours: you will get firms on the register using that to promote their interests to potential clients—putting on the notepaper something such as “Registered lobbyist, regulated by the Registrar of Lobbying Companies”, as a way of giving themselves the seal of approval. I fully endorse what the noble Lord, Lord Campbell-Savours, is trying to do in his amendment but I think that it raises that broader issue which he has touched on and which we need to be very much aware of. I am surprised that we have not considered that to a greater extent. It is just one of the problems if you go down this particular route of having a formal register, especially if there is no code attached to it.

[Lord Hardie]

My Lords, I agree with the noble Lord, Lord Norton of Louth, and support the amendment proposed by the noble Lord, Lord Campbell-Savours, for the same reasons. I also support the amendment proposed by my noble friend Lord Martin of Springburn but for a different reason from that given by the noble Lord, Lord Tyler. The example the noble Lord gave of meeting the employer in the company of someone who was both a lobbyist and a newspaper reporter highlights the need for a code of conduct. What is there to stop the lobbyist in that situation from sitting in on a meeting and then rushing away and phoning his newspaper to tell them he has a scoop—or whatever it is called nowadays—that the factory in Springburn has or has not been saved. More subtly, he could tell one of his fellow reporters. Therefore it is important that the distinction is maintained. Of course, if there was a code of conduct I would hope that that would be contrary to the code and the lobbyist could be deregistered, or whatever the appropriate word is.

[Lord Hodgson of Astley Abbotts]

My Lords, I support this issue. If you are regulated by the Financial Services Authority you have to mention it. There is a very substantial series of penalties and enforcement procedures if you fail to comply with the authority’s regulations. We need to be clear in our own mind whether this is going to be seen as the kitemark, whether it is going to be permitted as the kitemark and, if it is, how we make sure the kitemark standards are achieved.

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[Lord Campbell-Savours]

My Lords, in moving Amendment 88, I will also speak to Amendment 90. The Bill as it stands sets out a series of offences under Clause 12. The offences include “inaccurate or incomplete” registration and failing,

“to submit an information return under section 5”.

The Bill then goes on to propose penalties in the form of fines. What the Bill does not do at this stage is set out the arrangements for removal from the register, which is what my amendment is intended to deal with. Under the heading “Guidance”, Clause 21 states:

“The Registrar may give guidance about how the Registrar proposes to exercise the functions under this Part”.

Under Clause 21(2)(c), it is proposed that the guidance may indicate,

“the circumstances in which the Registrar would … remove a person’s entry from the register”.

My amendment flags up what I believe these circumstances should be.

The first circumstance is bringing Parliament into disrepute. I recognise that the professional associations have their own codes of conduct, but their codes are not written by Parliament—they are written by their legal advisers and approved, I presume, by their members. Parliament, in conditions of a statutory register, although not included in the Bill, needs to seek protection against being itself brought into disrepute through the actions of lobbyists who are not subject to a code. We will all be aware of the well documented and publicised scandals of recent years and that a small minority of lobbyists can abuse their relationships with Members of Parliament. The same applies with civil servants: if a lobbying operation is found to have compromised the integrity or independence of a civil servant, it is not just the civil servant who is necessarily at fault; a heavy burden of blame inevitably falls on the lobbyist. We need to be sure that the lobbyist concerned loses his or her official seal of approval, which is effectively what registration provides.

As to the wider issue of offences under Clause 12, there can be no circumstances in which a lobbyist who commits an offence under this clause should be allowed to remain on the register. We need more than guidance at this stage. We need to place firmly and clearly in the Bill our view as Parliament on what the circumstances for deregistration are. I beg to move.

[Lord Hardie]

My Lords, Amendments 89, 103, 109 and 110 stand in my name. Amendment 89 is concerned with Clause 6. Your Lordships will note that Clause 6 empowers the registrar to do a number of things, including, under Clause 6(6)(b), to decide whether a person’s entry should be removed from the register:

“If the Registrar has reasonable grounds for believing that a registered person is not (or is no longer) a consultant lobbyist”.

It is important to bear in mind that under Clause 1, a person cannot be in business as a consultant lobbyist unless he or she is registered. The decision of the registrar to remove someone from the register effectively stops that individual from operating in business. As far as I can see, there is no right of appeal against the decision of the registrar, which seems fundamentally unjust. Anyone who is aggrieved by a decision to remove him or her from the register ought to have a right of appeal to the tribunal, and that is what this amendment seeks to do.

[Lord Campbell-Savours]

I did not want to tie the Order Paper down with a very long amendment but if I had done more homework I would have introduced an element of appeal. I was simply floating the principle and I am sure that, were the Government to accept it, an appeal procedure would be introduced into the Bill.

[Lord Hardie]

I take the noble Lord’s point. I am not criticising his amendment; I am criticising the Bill. The Bill does not contain any right of appeal. My Amendment 89 introduces such a right for someone who is aggrieved by the registrar’s decision.

Not only does the Bill deprive someone of the right to a livelihood, perhaps, but Clause 12 creates an offence: it is a criminal offence to lobby if you are not on the register. Not only do you deprive someone of their livelihood but you subject them to the possibility of criminal proceedings and a fine. Clearly there ought to be a right of appeal. There is a tribunal in existence so there is no difficulty about that.

I have already referred to Amendment 103, which creates similar offences in relation to the register of lobbying activities, so I will say no more about that.

Amendment 109 relates to Clause 16, which concerns the ability of the registrar to impose civil penalties. The level of the penalty is fixed at £7,500. I have suggested that that should be reduced to £5,000. The civil penalty is an alternative to prosecution and, if you are prosecuted, the maximum summary fine in Scotland is £5,000 so I do not understand why the civil penalty is half as much again. There may be a reason for that; if there is, I would like the Minister to tell me; if there is not, there should be equivalence of penalties.

My final amendment is Amendment 110. It relates to Clause 18, which states:

“The Registrar may not impose a civil penalty on a person in respect of any conduct … at any time after criminal proceedings … have been instituted … and before they have been concluded, or … after the person has been convicted of an offence under this Part”.

My amendment introduces, after the word “convicted” in subsection (1)(b), the words “or acquitted”. Once we get to that stage, the individual has gone through a criminal trial and a court has decided that he or she is not guilty. Unless we include the words “or acquitted”, a court may have acquitted someone but the registrar could still impose a civil penalty of £5,000. Again, that is unjust. That is the reason for that amendment.

[Baroness Hayter of Kentish Town]

My Lords, in supporting Amendments 88 and 90, which stand in the name of my noble friend Lord Campbell-Savours, I will speak in particular to Amendments 107 and 108, which are in my name and that of my noble friend Lady Royall.

The four amendments comprise the framework that would enable the register to be more than just a limp piece of paper. Taken together, they provide that if someone on the register breaches the code of conduct or the Bribery Act, or is found unfit to be registered as a lobbyist—for example, if they have brought Parliament into disrepute—the registrar would have the power either to remove them from the register or to impose an appropriate civil penalty. That is perhaps rather closer to what was suggested earlier by the noble Lord, Lord Hodgson of Astley Abbots, which is what happens under what is now the Financial Conduct Authority’s list of recognised people. So this is an important combination of amendments.

Of course, we agree that someone should have the right of appeal to a tribunal, as with any such threat to the removal of one’s profession and employment. As the noble and learned Lord said, there is already a well established tribunal that deals with appeals from the pensions regulator and other similar bodies.

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[Lord Wallace of Saltaire]

My Lords, when considering the most appropriate sanctions in respect of non-compliance with the register, Ministers considered the option of removing a person from the register, thereby prohibiting them from continuing to operate as a lobbyist. However, we concluded that such a sanction would represent too extreme a penalty, as it would essentially take away their livelihood.

I am conscious that I speak on the edge of my expertise, but a number of professions have disciplinary procedures and appeals within those procedures, some of which are very complex. I was once approached to join the General Medical Council but once I understood what it did, I rapidly said no. The issues of due process and dismissal, judicial review et cetera are ones that we are reluctant to enter into in this respect. The sanctions regime that we have designed is therefore more limited and designed to provide on appropriate deterrent against, and punishment for, non-compliance with the register’s provisions.

As the Committee will know, breaches of the Bribery Act are punishable by unlimited fines, up to 10 years’ imprisonment, or both. I am not convinced that an additional sanction—that of being prohibited from carrying on a certain profession—should be added to those already significant penalties. Further, breaches of the Bribery Act must be proven beyond reasonable doubt in a criminal court, yet the Opposition’s amendment would enable the registrar to draw his or her own conclusion as to whether the Act had been breached, and to impose sanctions on the basis of that conclusion. I suggest that such a power or responsibility is not a suitable one for the registrar of a new register, but instead that breaches of the Bribery Act should continue to be determined in court.

Amendment 89, tabled by the noble and learned Lord, Lord Hardie, would enable a person to appeal against the registrar’s decision to remove them from the register as per Clause 6(6). We do not envisage that the registrar would remove any person from the register unless they were confident that that person no longer engaged, or wished to engage in future, in consultant lobbying. The removal power is not intended as a sanction but rather as an administrative housekeeping measure to enable the registrar to maintain the accessibility and relevance of the register.

[Lord Hardie]

Does the Minister accept that while I do not dispute that the registrar would be operating in good faith, he may genuinely make a mistake—and if he does, it has the effect of removing someone from the register. Is there to be no appeal to the tribunal for that? There may not be many appeals at all. It is only if the person is aggrieved that he has a right of appeal.

[Lord Wallace of Saltaire]

My Lords, that seems unlikely, on the face of it, but I am very glad to go away and consult officials to make sure that there is not a lacuna here. I appreciate where the noble and learned Lord is coming from, with a genuine concern on this issue. If one were to accept some of his other amendments, the case for writing into the Bill the appeal to the tribunal would be stronger. If a person were to object, under our scheme, to the registrar’s decision they could advise him or her accordingly and reregister without difficulty. We do not therefore consider that appeals to the tribunal should be necessary in those circumstances.

The Opposition’s proposed amendments, Amendments 101, 105 and 106, appear designed to ensure that the provision of misleading information is captured by the offence outlined in Clause 12 and, as a consequence, by the civil penalty power provided for in Clause 14. I am advised that “incomplete or inaccurate register” also covers the question of “misleading”. I can therefore confirm that the provision of misleading information in any of these instances would be captured by the concept of,

“information which is inaccurate or incomplete in a material particular”,

as provided in subsections (2)(b), (3)(b) and (4)(b) of Clause 12.

The offence outlined in Clause 12 is designed to be applicable in both the civil and criminal systems. We anticipate that the provision of inaccurate or incomplete information due to administrative oversight will be sanctioned by the imposition of a civil penalty. If, however, inaccurate or incomplete information had been provided in an attempt to deliberately mislead, we could expect such non-compliance to be prosecuted in a criminal court.

The Opposition’s Amendment 108 would enable the registrar to impose civil penalties for breaches of the code of conduct. The establishment of sanctions, whether civil or criminal, requires detailed and measured consideration. The Opposition have been able to identify only one of the provisions to be included in the statutory register. I suggest that the provisions with which lobbyists would be required to comply should surely be identified before it was determined whether they should be liable to a civil penalty in the event of a breach.

Amendment 103, tabled by the noble and learned Lord, Lord Hardie, would impose an offence on those who failed to submit lobbying activity reports as and when required. We recognise that this amendment is consequential to his other proposals so I will not address it further. His Amendment 109 would amend Clause 16(3) so that the maximum amount for a penalty notice would be reduced from £7,500 to £5,000. I note that his point of comparison is the Scottish civil penalty. In setting the maximum amount for a penalty notice at £7,500, the Government were mindful of comparable regulatory regimes, such as the fines imposed by the Companies Act in relation to the late filing of accounts, and we took that as our comparator. The Government are confident that the proposed limit of the civil penalty is thus an appropriate one and are not persuaded that it should be reduced, although of course the registrar is able to issue civil penalties of any amount up to £7,500, so not in every case would it be the amount.

The noble and learned Lord’s Amendment 110 would prevent the registrar from issuing a civil penalty to a person if that person had been acquitted of an offence under this part in relation to their conduct. We then get into interesting questions; as a non-lawyer, I am not entirely an expert on the difference between the evidence required to prove a criminal case and that which is required to produce a civil one. Perhaps we might consult on that off the Floor to resolve that very delicate distinction. Having answered some of those extremely interesting and detailed probing amendments, I hope that the noble Lord will feel able to withdraw his amendment.

Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Bill

Lord Hardie Excerpts

Tuesday 22nd October 2013 Lords Chamber

[Lord Hardie (CB)]

My Lords, I refer to my entry in the register of interests as president of Capability Scotland. I will not repeat the concerns about the effect of the Bill upon the voluntary sector, which were so ably expressed by my noble friend Lord Ramsbotham, the right reverend Prelate the Bishop of Derby, the noble and right reverend Lord, Lord Harries of Pentregarth, and other noble Lords. I agree with those concerns.

I support the intention behind the provisions in Part 1 about the transparency required from lobbyists, but I fear that they do not go far enough to restore public confidence in our political system. Like many noble Lords, I consider that the provisions confine themselves to the registration of consultant lobbyists and their dealings with Ministers and civil servants at the highest level, and they fail to address in-house lobbyists. Are the public not also entitled to know of these possible influences in the formulation of policy? The duty on Ministers to disclose, on a regular basis, meetings that they have with individuals and the subjects discussed is no answer to that omission. Should that disclosure not be contained within a central database of all activity and be available to the public for inspection? In that regard, I agree with the noble Lord, Lord Tyler. However, what sanctions exist for the failure of Ministers and civil servants to comply with such obligations?

The provisions are also inadequate in another respect. The obligation of disclosure is confined to lobbying of Ministers and Permanent Secretaries, Second Permanent Secretaries or persons serving in the offices listed in Part 3 of Schedule 1. As has been observed by other noble Lords, the reality is that lobbyists will also have dealings with civil servants of a lower grade as well as political advisers to Ministers. Can the Minister tell the House why the need for transparency has not been extended to people in those positions?

I share the concerns expressed by the noble Baroness, Lady Hayter of Kentish Town, the noble Lords, Lord Ramsbotham and Lord Lang of Monkton, and other noble Lords about the lack of any consultation about this part of the Bill before its introduction in the other place.

Part 2 includes various provisions restricting the involvement of third parties in elections by altering the definition of controlled expenditure and by reducing the level of such expenditure contained within the Political Parties, Elections and Referendums Act 2000. I accept that, where non-party campaigning takes place on a scale that could have a significant effect upon elections, it is important that it is transparent and controlled. However, we must guard against imposing arbitrary limits that will have the unintended consequence of discouraging electors from engaging in the democratic process. Any controls on third parties must be reasonable and a proportionate interference with the right to freedom of political expression. The Bill expands the definition of controlled expenditure in the manner already mentioned by noble Lords and I will not repeat that. At the same time, it reduces the limit on controlled expenditure from £10,000 in England, or £5,000 in each of Northern Ireland, Scotland and Wales, to £5,000 and £2,000 respectively, at which point registration is mandatory, with all the regulatory and administrative burdens that that entails, not to mention the risk of criminal sanctions.

I, too, wish to congratulate the noble Lord, Lord Horam, on his maiden speech. I share his concern about these reduced financial limits. Will the Minister tell the House the evidential basis for reducing the limits set in 2000, given that it is now proposed that the scope of the activities to be controlled is extended? I agree with the noble and right reverend Lord, Lord Harries, that the passage of time and the expanded definition of controlled activities suggest that an increase in the limits would be more appropriate.

I have similar concerns about the substantial reduction in the national limits of controlled expenditure. Since 2000 those have been £793,500 for England, £108,000 for Scotland, £60,000 for Wales and £27,000 for Northern Ireland. Clause 26(2) reduces those to £319,800, £35,400, £24,000 and £10,800 respectively. Has any assessment been undertaken on whether the revised figures would permit a reasonable opportunity to non-recognised third parties to campaign on issues that they consider to be of national importance? I question whether those limits would permit a national rally, for instance, if groups wish to campaign against government action, such as occurred in relation to the Iraq war or might occur in relation to climate change or other environmental issues.

The Minister sought to give us reassurance on that and emphasised that expenditure would not be controlled expenditure unless it could reasonably be regarded as promoting or procuring electoral success for one or more parties. The Minister is correct, of course—that is what Clause 26 says—but what is the practical implication of that? Let us suppose that a local action group has formed to oppose the closure of a local hospital in the constituency or to support or oppose HS2 or fracking. Expenditure on relevant activities, such as advocating the views of the group, would be controlled expenditure if those views were opposed by one candidate but supported by another. Is that consequence not an unacceptable interference in the democratic process which is disproportionate and which crosses the line of legitimate control?

There is another difficulty with this part. There are inconsistencies in the statutory regime that risk confusing third-party campaigners. I refer to Scotland, where the proposed limit of £35,400 includes expenditure during the year before the general election. In contrast, the spending limit for a Scottish parliamentary election, which has been fixed by this Parliament, is £75,800 for similar activities, but the relevant period is four months. The current proposal in the Bill before the Scottish Parliament for the referendum in Scotland is that there will be a spending limit of £150,000 for similar activities during the four-month period before the referendum. Such variations will confuse third parties in that jurisdiction who wish to engage in these campaigns. Will the Minister tell the House how he can justify the inconsistencies that exist in affording the electorate the opportunity of expressing their views?

Finally, the changes to the scope and financial limits of controlled expenditure will have an effect upon the enforcement regime operated by the Electoral Commission. Will the Minister confirm that the Government expect the commission’s regulatory regime to continue to focus primarily upon retrospective action and that its use of stop notices will be confined to cases where there is a significant risk of seriously damaging public confidence in the statutory controls? What assessment has been made of the likely increase in actions of judicial review against the commission as a result of the Bill? Will the Minister also advise the House whether additional resources are to be provided to the commission to enable it to meet its obligations?

Like other noble Lords, I urge the Minister to withdraw the restrictions that Part 2 imposes upon the freedom to participate in elections that has existed since at least the 2000 Act.

--- Later in debate ---

[Lord Wallace of Saltaire]

My Lords, we will return to the explanatory document at a later stage. This has been an extremely vigorous evening. We look forward to several days in Committee and on Report. The Government will consult a range of stakeholders between Second Reading and Committee, and we will continue to consult between Committee and Report. This House will, as the noble Lord, Lord Greaves, assured me very vigorously, look in detail at the language of the Bill and also look back at the language of PPERA, and, we hope, produce something of which we can all be proud at the end of the day.

[Lord Hardie]

I wonder whether the Minister will address the concerns of local action groups, as opposed to charities.

[Lord Wallace of Saltaire]

I am sorry; I did not hear the noble and learned Lord.

[Lord Hardie]

I was asking about local action groups as opposed to charities.

[Lord Wallace of Saltaire]

My Lords, local action groups, if they are not campaigning for or against a particular candidate or a particular party, will not fall within the terms of the Bill.

[Lord Hardie]

The Minister obviously did not hear my speech. I referred to the situation where a local action group had a particular interest—for example, against the closure of a hospital or against, or in favour of, HS2, or other environmental situations. If one candidate supported that view and another candidate was opposed to it, that would be controlled expenditure. Is that to be stopped?

[Lord Wallace of Saltaire]

In the case of Kidderminster Hospital, which I think was one of the examples quoted, there was indeed a candidate who was the Kidderminster Hospital candidate. That of course then becomes a much clearer case.

The hour is late and I should like, if I may, to continue these discussions in the Corridors between Second Reading and Committee.