Electoral Commission Investigation: Vote Leave

Debate between Christopher Chope and Chloe Smith

Tuesday 17th July 2018 Commons Chamber

[Sir Christopher Chope (Christchurch) (Con)]

Will my hon. Friend put the synthetic outrage of remain campaigners into some kind of context by reminding the House that many of those same remain supporters in this House tried to change the Electoral Commission’s rules on referendums to enable the then Government to breach the purdah rules? Fortunately, that attempt by that Government was thwarted by this House. Many of those remainers would have liked to have a relaxed purdah arrangement.

[Chloe Smith]

My hon. Friend’s point reminds us that, as I said earlier, there are arguments on this issue that cut both ways. He highlights how he sees an example of an infraction in another direction. I simply return to the point that we in the Government are getting on with implementing the result of the referendum. We think that is the correct response to retain the people’s trust in our democracy. As has already been said, that matters.

Voter ID Pilot Schemes

Debate between Christopher Chope and Chloe Smith

Wednesday 6th June 2018 Westminster Hall

[Chloe Smith]

I will not. I have to conclude, and the hon. Gentleman and others have had their chance to contribute.

Voter ID is of course just one element of efforts, which I hope command cross-party support, to protect and sustain the electoral system, which should be precious to us all. I thank the hon. Member for Poplar and Limehouse (Jim Fitzpatrick) for coming along to express his support for voter ID. Indeed, he explained that he would go further and do more to protect the voting system. That is why we at the Cabinet Office, in partnership with the independent Electoral Commission and Crimestoppers, are working to ensure that people feel encouraged to report electoral fraud if they see it. I marvel at how the rest of the Labour party cannot bring themselves to support such efforts.

At the moment, it is easier to vote in someone else’s name than to collect a parcel at the post office, so doing nothing would be wrong. We cannot allow a crime to happen until it reaches a certain level. It is doubly unfortunate that the Labour party continues its scaremongering, especially given that the previous Labour Government introduced photo ID at polling stations across Northern Ireland in 2003. Although today’s Labour party might not think doing that is an acceptable step to protect our voting system, constituency Labour parties think it is good enough for them, as they routinely insist on ID. Doing one thing and saying another seems unprincipled to me. On top of that, Opposition Members came here to quibble about the numbers. This is not about statistics; it is about the principle. Why do they disagree with the principle of tackling electoral fraud?

Electoral fraud is not a victimless crime. The Electoral Commission stated in its 2013 review:

“The majority of people in communities affected by electoral fraud are victims rather than offenders. The people who are likely to be the victims of electoral fraud can be described as vulnerable.”

In his report on electoral fraud, Sir Eric Pickles explained clearly that it was

“local residents who lost out from the crooked politicians who bullied them and wasted their money. The law must be applied equally and fairly to everyone.”

I remain committed to ensuring that equality is integral to everything we do in elections policy. I met the EHRC earlier today, and we share common ground on ensuring that whatever we do has the rights of electors and the fairness, equality and inclusivity of our electoral system at its heart.

The hon. Member for Lewisham West and Penge made repeated reference to photographic ID. I think she knows that was not helpful. That is not what the pilots required. Let me put on the record that no one needed to purchase ID documents to be able to vote in the pilots. Local authorities provided alternative methods free of charge, to ensure that everyone who was registered had the opportunity to vote.

The Government will reflect on the voter ID evaluation that the Electoral Commission publishes in July. The hon. Member for Edinburgh East (Tommy Sheppard) will find that the Electoral Commission has published the list of the data that it will use in that evaluation. We will use that as an opportunity to review, among other things, how the awareness-raising campaigns operated and what could be improved.

I say again to the hon. Member for Lewisham West and Penge that I am grateful to her for bringing forward the points she made and for staying in touch with residents in one of the important pilot areas, but her arguments are not convincing. This really is a simple matter of principle: do we or do we not believe in stamping out electoral fraud? I do.

[Sir Christopher Chope (in the Chair)]

Ellie Reeves, you have 10 seconds if you want them.

Collective Ministerial Responsibility

Debate between Christopher Chope and Chloe Smith

Wednesday 13th February 2013 Westminster Hall

[Miss Smith]

I would be only too delighted to engage in that discussion with my hon. Friend, but as he knows, I no longer practise the dark arts carried out by what are known as the usual channels. I regret that I would not be able to do that decision justice; nor could I report back to those who make those decisions, if I even tried.

On the ministerial code, it is important to note that there is clear precedent, as has been said several times today, for suspending collective ministerial responsibility on specific issues, when the Government of the day decide that it is appropriate. A notable example, which we have discussed, is Harold Wilson’s decision on whether the UK should continue to be a member of the European Economic Community. He allowed members of his Cabinet to speak and campaign on both sides.

Let me offer the Chamber a few other historical examples. Shortly after the formation of the national Government in 1931, an “agreement to differ” was agreed. The terms of that were published in The Times in January 1932, and in February that year, the Home Secretary began a speech by commenting on the doctrine of collective responsibility:

“The House will have an opportunity…of discussing fully the departure from the doctrine of collective responsibility which is marked by my appearance at this Box this afternoon”—[Official Report, 4 February 1932; Vol. 261, c. 316.]

It is also helpful to note that in 1977, James Callaghan, the then Prime Minister, said:

“I certainly think that the doctrine should apply, except in cases where I announce that it does not.”—[Official Report, 16 June 1977; Vol. 933, c. 552.]

That demonstrates that the terms, duration and enforcement of the arrangement are ultimately a matter for the Prime Minister.

It is most important to add that the current Government have decided to set collective responsibility aside on some specific occasions. That is a fact of life in a coalition, and it shows how our constitutional practice can evolve to suit new situations.

[Mr Chope]

The Minister is talking a lot about the history, but can she explain why the Prime Minister was unable to give me a straight answer to my question, asking why he set aside collective ministerial responsibility in respect of the Electoral Registration and Administration Bill, and on what date that decision was taken? Why could the Prime Minister not let me have a straight answer on that?

[Miss Smith]

I wanted to go on to say, in addressing what I took to be my hon. Friend’s central point—accountability for the decision, when taken, to set aside collective ministerial responsibility—that the key is that Parliament certainly ought to be informed in a way that is appropriate to the instance in hand. I will not comment on whether the Prime Minister did or did not do that for the hon. Gentleman in parliamentary questions, but in the instance of the Lords amendments to the ERA Bill, my right hon. Friend the Leader of the House of Commons made such a statement to the House, explaining why he was speaking and how it was that collective responsibility had been set aside. I believe that the explanation has been offered in cases where such a departure has been outlined, and I think that that provides the kind of transparency and accountability that we are all seeking in this important area.

In conclusion, I note that the coalition agreement, in so far as it relates to the debate, sets out specific areas where the normal rule is not expected to apply. The citizens whom we all serve have had the chance to observe that in advance, and so hold us to account. Through that, there is no undermining of the coalition’s shared commitment to reducing the deficit and delivering a radical programme of reform that gets Britain back on track, after the catastrophic position in which it was left in 2010.

It has been possible in my short remarks to address only the notion of accountability for such decisions, but I want to finish by saying that it is vital that we are not distracted from our core task in Government at this time, which is to put right the mess that the Labour party made of Britain.

Oral Answers to Questions

Debate between Christopher Chope and Chloe Smith

Tuesday 8th January 2013 Commons Chamber

[Miss Smith]

It is the Government’s intention to proceed with the individual electoral registration programme, which will increase and improve the accuracy of the registers we work with. It is really important that we all continue with the support that there is across the House for those proposals.

[Mr Christopher Chope (Christchurch) (Con)]

Can my hon. Friend guarantee that the next general election will be fought according to the new parliamentary boundaries recommended by the Electoral Commission, and that it will be fought with individual voter registration?

[Miss Smith]

I think that the answer to my hon. Friend is best given within the point that there will be a vote on those proposals, as I think he knows. On individual electoral registration, I can confirm that the programme is proceeding as planned, and I am happy to give him further details on that.

Consumer Insurance (Disclosure and Representations) Bill [Lords]

Debate between Christopher Chope and Chloe Smith

Tuesday 6th March 2012 Commons Chamber

[Mr Chope]

My right hon. Friend anticipates my next point, which was to say that this should be, and will be, sorted out in the marketplace. Perhaps a new company called Simple Insurance could be formed—if no such company already exists—with my hon. Friend the Member for Cardiff North (Jonathan Evans) as a director. It could promote itself on the basis that it would ask just a few easily answerable questions that would not prove too burdensome. I agree with my right hon. Friend that that would be a better way of dealing with this matter. However, the amendment underlines the fact that many of the forms are far too complicated and intimidating, to the extent that people often tick all the boxes without looking at the small print. That is how many of them get into difficulties. These forms are often not filled in by the persons themselves but by somebody on the end of a telephone. Again, that can lead to difficulties of language or understanding. It is not just my hearing that sometimes makes it difficult for me to understand what people are saying on the other end of a phone when they are seeking information. There are some important issues here, but I do not think that the amendment has proposed the right solution to the problem.

[Miss Chloe Smith]

I shall answer a few questions. On this amendment, I am indeed with my hon. Friend the Member for Christchurch (Mr Chope) and my right hon. Friend the Member for East Yorkshire (Mr Knight), as I believe that the market will assist us in this area. I shall deal with the amendment principally on that basis.

The amendment, as hon. Members will have seen, would create a duty for insurers to make disclosure requests that are proportionate to the benefits generated. Following discussion in Committee, we return to the issues today; I hope I shall be able to add to what my colleague, the Financial Secretary said there.

There is no disagreement with the principle that the burdens on consumers should be as light as possible. That applies to the group of consumers mentioned by the hon. Member for Nottingham East (Chris Leslie) and, indeed, to all others who wish to purchase insurance. As the amendment rightly recognises, there is a balance to be struck between burden and benefit. The Government believe this balance is best struck by the Bill as it stands, with commercial pressures operating as a factor in that case.

I shall recap those points shortly, but I want to set out some background information on the types of questions currently asked, as I know Members were interested in that topic in Committee. They were particularly interested in the average number of questions asked when consumers enter into different types of insurance policy. I was able to take only a rough look at such things, but for some current policies it can take about 13 to 18 questions to underwrite home insurance and 12 to 18 to underwrite motor insurance. Requirements linked to these straightforward, mass-market products do not on this rough measure appear to be at all excessive. Simply counting questions, however, rather misses the point.

If insurers asked only a single question, this would be far more burdensome for consumers. I think it is much easier to answer a series of short, targeted questions—and this Bill sets out that they must be specific and clear—than it is to answer a single general question like “Has anything changed?” or “Is there anything I need to know?”

The Law Commission undertook a more sophisticated analysis of burdens on consumers, which was contained in its first discussion paper and has informed the development of this Bill. It discovered real problems in 2007 with the questions being asked in life and critical illness insurance. For example, one insurer asked, “Have you had any physical defect or infirmity, or is there any ailment or disease from which you suffer or have suffered or to which you have a tendency?” This seems impossibly difficult to answer and appears to require the consumer to begin at birth and work through every single visit to the doctor. Yet that might qualify as proportionate under this amendment because it is only one question. Reassuringly, there have been significant moves in this sector to improve the questions since 2007. The design of this Bill will further promote this improvement.

It is worth explaining briefly—I think the hon. Member for Nottingham East referred to this earlier—that different consumers face a different set of questions in order to purchase a similar policy by virtue of the channel they choose, whether it be through an aggregator, by telephone or face to face in a broker’s office. There is a need for insurers to tailor the requests they make in these different ways.

The burdens placed on consumers form the nub of the issue, and there is evidence that insurers already pay careful attention to those burdens. It has already been argued tonight that this is partly driven by market pressure, so let me add to those arguments. Clearly, a consumer has the choice to purchase from an alternative provider if disclosure burdens are too high. Indeed, some insurers have advertised products on the basis that they are easy to purchase. Comparison sites consistently study these drop-off rates and try to make the process as easy as possible.

It strikes me that no business wishes to run the risk of losing a customer entirely—the scary scenario that the hon. Member for Nottingham East has set out. No business would wish to do that because it would represent the loss of a customer. We hope that no consumer would wish to be in that position, as they would not then get the security of the product that they are looking for.

There are, of course, some savings to be made for insurers who get the right balance between getting the information they need and making it easy for consumers to purchase their product. The cost of asking another question is not insignificant, and insurers are well aware of that when they design their questionnaires. I refer the House to a PricewaterhouseCoopers report in November 2007, which considered the financial impact of the Law Commission’s insurance project as a whole. It estimated that increasing underwriting by two to three minutes per policy would equate to up to an extra £3,600 per 1 million of gross written premiums—equivalent to around an extra £150 million spent in the UK general insurance market alone. That does not include other costs associated with asking more questions, such as for the gathering and processing of the data. It is clear that there is a strong existing incentive for insurers to ensure proportionality.

I shall deal briefly with the Bill’s other provisions, in case Members do not already find the arguments about market pressures compelling enough to rely upon tonight.

Two further features of the Bill mean that if insurers impose burdens on consumers, they might undermine any right they have to refuse or reduce a claim. Under clause 4(1)(b) an insurer is not entitled to a remedy unless they can show that a consumer’s misrepresentation induced them to enter into the contract—at all or on its current terms. As a result, the Bill creates no benefit for insurers if they ask questions to seek answers on which they would not need to rely. Furthermore, under clause 3, a long and complicated questionnaire might have a bearing on whether a consumer has taken reasonable care not to make a misrepresentation. Insurers are at greater risk of having to pay claims, despite not having been given the correct information, if they make things difficult for the consumer. So in my view, there is no danger that the Bill will place extra burdens on consumers—as a result of those two measures in addition to the market forces mentioned earlier. Our impact assessment does not expect the Bill to result in significant changes to the questions asked by insurers. Rather, the Bill brings the statute into line with existing best practice and regulation. It is fair to say that we are updating the law, not altering the approach of insurers.

I do not believe that it would be beneficial for this Bill to go further than it does by seeking to change practice by prescribing the content and number of insurers’ questions. If we were to prescribe or limit the information insurers were able to seek, it might even increase premiums. Let us take, for example, the recent European Court of Justice ruling—one hon. Member has already referred to it—on the use of gender in insurance pricing, which shows that limiting the risk factors that insurers can use will increase the average cost of insurance.

Creating a duty for insurers in primary legislation would not be the appropriate solution. We continue to work closely with the insurance industry on this issue and with consumer groups on a range of issues. Where there are specific concerns about practice in certain parts of the market, the Government have worked with the industry on guidance. Accepting this amendment and creating a provision is unnecessary. It will throw out the careful balance in the Bill, and it is not the most effective way to make sure that consumers do not face excessive burdens. I therefore ask the hon. Gentleman to withdraw his amendment.

--- Later in debate ---

[Miss Chloe Smith]

I beg to move, That the Bill be now read the Third time.

I shall do my best to be brief but comprehensive. I think that Members on both sides of the House can agree that the current law relating to pre-contractual disclosure and representation in connection with consumer insurance contracts is unreasonable. I think we can also agree that the alternative practices favoured by regulators and insurers, although not always consistent, give the consumer far better protection from the unreasonable refusal of claims. The Bill updates the law to reflect what has rightly become market practice, and in doing so it clarifies the duties of consumers and how they can expect to be treated by insurers.

On behalf of my hon. Friend the Financial Secretary to the Treasury, who began the process, I thank all Members who have spoken during the Bill’s passage and who have, without exception, recognised that it constitutes a valuable and much-needed updating of statute. We also owe thanks to the Law Commissions, whose joint report on the issue and extensive work has produced a Bill that implements this change with the backing of a wide range of consumer groups, as well as that of the industry and regulators.

The drafters of the Marine Insurance Act 1906, if they are still with us, will not have envisaged the ways in which consumers currently purchase insurance cover for such purposes as their homes, their cars or their health—or their llamas. They will also not have envisaged the existence of the comparison website, and the way in which it requests information from consumers.

In October 2010, a letter with a range of signatures was sent to The Times in support of the Bill. It described the current law as designed to

“govern face-to-face commercial insurance deals in the coffee houses of Georgian London.”

The 1906 Act is not suitable for the modern insurance market, especially as it contains harsh penalties for reasonable failures to disclose or accurately represent information by those purchasing insurance. The Bill replaces the current burdensome duty requiring the consumer to provide all information that might influence the judgment of a prudent insurer with a requirement for consumers to take reasonable care to answer the insurer’s clear and specific questions. It also makes penalties for non-disclosure or misrepresentation proportionate, rather than allowing the insurer to legally void the contract in all cases. Consumers have been protected by the Financial Ombudsman Service—which has been applying those proportionate remedies for some time—as well as by market practice and Financial Services Authority rules, but there are real benefits in aligning the law with that practice.

In some circumstances, the different legal and regulatory positions cause problems for both industry and consumers. At present, the FOS receives about 1,000 complaints a year about non-disclosure and misrepresentation. About half the insurers’ decisions are upheld, a figure we would expect to be much higher if there were sufficient clarity about the rules. That indicates that insurers find it difficult to locate and interpret the relevant rules.

We believe that those two key provisions—the change in the duty of the consumer and the provision of a proportionate rather than a harsh set of remedies for the insurer—shift the balance of the law in favour of the consumer. Some parts of the Marine Insurance Act are heavily biased in favour of insurers, and the Bill attempts to rectify that bias.

[Mr Chope]

Has my hon. Friend or her Department produced any estimate of the likely reduction of the burden on the Financial Ombudsman Service?

[Miss Smith]

Some estimates have been made, and I believe that my hon. Friend will find some of them in the impact assessment, but I am sure that my hon. Friend the Financial Secretary will be happy to deal with the point in more detail.

The Bill takes a high-level approach, updating the principles set out in law to bring them into line with good practice rather than attempting to set out prescriptive detail. That should help to prevent the law from becoming outdated again as market practice develops.

I hope that Members will accept the advice of consumer representatives who wrote to the Committee—including Age UK, the British Heart Foundation, Consumer Focus, Macmillan Cancer Support, the Trading Standards Institute, Which? and UNLOCK—and will give the Bill its Third Reading.

Remuneration of EU Staff

Debate between Christopher Chope and Chloe Smith

Tuesday 21st February 2012 Commons Chamber

[Miss Smith]

I think I will cover all those points in my speech, although I am grateful to my extremely well-informed hon. Friend for his prompt to do so.

Let me turn now to the 2011 EU salary adjustment. The Commission’s attitude towards EU staff pay adjustments is another clear indication of its estrangement from reality. In the UK, the public sector pay bill makes up more than half of departmental resource spending, so action on pay is inevitably part of the Government’s fiscal consolidation strategy. Accordingly, the Government have announced a two-year public sector pay freeze for those earning above £21,000, with pay awards following that averaging only 1%. Those measures are estimated to save around £3.3 billion a year by 2014-15.

At EU level, on the contrary, staff remunerations counted for 69% of the Commission’s budget in 2011, which means that EU annual salary adjustments have important implications for the size of EU administrative costs. However, rather than taking action to reduce its wage bill the Commission proposed to increase it by 1.7%, representing an extra €39 million, in the year from July 2011, despite the fact that the vast majority of EU officials earn significantly more than most public officials in the UK and many other member states.

I turn now to the position of the UK and the Council. Clearly, any pay increase for EU staff is unacceptable. In conjunction with other member states, the Government called on the Commission to lower its proposals, taking into account the economic situation and the policy measures in many member states to curb public wage bills. The request was made not once but twice, first in December 2010 and again in November 2011. The requests were made by invoking the so-called exception clause—article 10 of the 11th annex to the EU staff regulations—the only means for seeking to alter the mechanistic salary adjustment process under the current system.

Each time, the Commission has stubbornly refused to reduce growth in EU staff pay. Its defence for its inaction has been internally inconsistent, self-serving and, as the European Scrutiny Committee observed, one-sided. By claiming that there has been no

“sudden and serious deterioration in the economic and social situation”

in the EU, the Commission has undertaken faulty analysis. For example, it based its rosy evaluation on forecast indicators that did not pertain to the period defined for its assessment.

More seriously, the Commission ignored the huge number of important fiscal consolidation measures adopted and implemented by member states during the period under review. The Commission itself has strongly advocated such measures, yet incredibly it used stabilising debt and deficit levels to justify higher pay for its own staff.

Most seriously of all, the Commission has manipulated the current system to deprive member states of the opportunity to evaluate the situation independently and to adopt appropriate measures, at a time when it is evident to us all that taking immediate action to curb growth in EU staff pay is the right thing to do. That is why the UK and the wider Council rejected the 1.7% pay increase in December. It is also why we have blocked reductions in EU staff contribution rates to their pension scheme. In addition, the Council has lodged a court case against the Commission for mishandling the 2011 salary adjustment.

The Council’s decision to proceed with legal action against the Commission indicates the seriousness with which we treat the issue. Should the Council lose the case, it will simply add weight to our view that the current process is defunct and cannot adapt properly to difficult economic circumstances. In any event, reform of the salary adjustment system is urgent. The ongoing review of the EU staff regulations, which set out the rules in this area, provides an important opportunity to make that happen.

Delivering a subtler and more responsive way of setting EU staff pay, which empowers the Council to make suitable adjustments in times of economic distress and more generally, is an important objective. One part of the Government’s broader agenda to achieve efficiency gains and financial savings in the EU budget is via reform of the staff regulations that determine such a high level of the EU’s administrative budget.

Overall, the potential for savings is high. This dossier is subject to qualified majority voting and co-decision with the European Parliament. Our success will depend on building firm alliances, so the Government are already working closely with other member states to agree cost- saving ideas that can command broad support in Council.

[Mr Christopher Chope (Christchurch) (Con)]

Does my hon. Friend agree that the problem of co-decision with the European Parliament is that its Members already have their fingers in the till and are giving themselves a substantial pay increase for the coming year?

[Miss Smith]

I certainly agree that everybody associated with European institutions needs to show restraint at this time, as I think the debate will show in some detail, so I very much welcome my hon. Friend’s intervention. He will be reassured that alongside the measures I have already laid out, we intend to pursue the modernisation of EU institutions, in order to help them become more effective, and to encourage a better geographical spread of EU officials from across member states.