Election Expenses (Authorisation of Free or Discounted Support)

Lord Mackinlay of Richborough Excerpts

1st reading: House of Commons
Tuesday 12th March 2019 Commons Chamber

[Craig Mackinlay (South Thanet) (Con)]

I beg to move,

That leave be given to bring in a Bill to amend the Representation of the People Act 1983 to provide that election expenses relating to property, goods, services or facilities provided free of charge or at a discount are incurred only if authorised by the candidate or the candidate’s election agent; and for connected purposes.

Legislation should be like a big red bus. There should be no ambiguity about what it is, what it looks like and what it does. More importantly, there should be a full awareness of the consequences of stepping out in front of it. One such collection of legislation that currently fails the red bus test has to be election law, notably some of the provisions of the Representation of the People Act 1983.

The legislation, under decades of interpretation going back to 1868, meant that the agent and candidate were the gatekeepers of election expenditure. The potential for a criminal record, custodial sentence and bar from public office makes this an equitable settlement. This was recognised under section 90ZA in the Representation of the People Act, subsection (4) of which states:

“For the purposes of this Part of this Act, election expenses are incurred by or on behalf of a candidate at an election if they are incurred…by the candidate or his election agent, or…by any person authorised by the candidate or his election agent to incur expenses.”

All clear thus far. However, I wish to amend section 90C, which was inserted as part of the Political Parties, Elections and Referendums Act 2000.

With the continued mudslinging from all sides regarding the spending surrounding the EU referendum, I feel that red bus clarity would appear to be equally lacking in the PPERA—but that must remain a debate for another day. Section 90C introduced the wholly reasonable concept of accounting properly for goods, services and facilities provided either at a discount or free—for instance, a friendly printer, in lieu of a cash donation, providing below market rate or free printing. Section 90C ensured that the proper cost and corresponding donation for the discount were properly accounted for.

There was a long-established understanding of the section that the fundamental concept of proper agent or candidate authorisation still needed to apply under the authorising provision for election expenses under section 90ZA. I quote from the relevant subsection:

“property, goods, services or facilities is or are provided for the use or benefit of the candidate free of charge or at a discount of more than 10 per cent. of the commercial rate for the use of the property or for the provision of the goods, services or facilities, and

(b) the property, goods, services or facilities is or are made use of by or on behalf of the candidate in circumstances such that, if any expenses were to be (or are) actually incurred by or on behalf of the candidate in respect of that use, they would be (or are) election expenses incurred by or on behalf of the candidate.”

Paragraph (b) is of most interest, as it uses the word “incurred”, which mirrors entirely the word—and, one must presume, the intent—under section 90ZA.

As part of preliminary questions to be answered prior to my criminal trial, I took the question of the proper construction of section 90C to the Appeal Court after an initial interpretation of the position by the trial judge. The Lord Chief Justice at the Appeal Court agreed with the long-understood position that I have outlined—that for section 90C to apply, proper approval of such expenditure by the agent or candidate must be there under section 90ZA. So normality seemed to have returned—but the story did not end there. The Crown Prosecution Service, with the Electoral Commission attaching itself as an interested party, appealed the Appeal Court decision to the Supreme Court. That judgment was given on 25 July 2018. It overturned the Appeal Court decision and the long-held interpretation used by all agents, candidates and political parties.

In summary, the Supreme Court, whose judgment has to stand as the definitive interpretation of section 90C, directs that election-related expenses expended without the authorisation of an agent or candidate can none the less be deemed election expenses. With the Electoral Commission attaching itself as an interested party to the Supreme Court hearing, one must assume that this “no need for authorisation” interpretation was always its interpretation of election law. If that were the case, why did it not say so in its guidance for all candidates and agents for the 2015 general election?

With my prosecution looming into view by the time of the snap 2017 general election and with interpretation of section 90C at the heart of it, one might have expected the Electoral Commission, which claims that the Supreme Court interpretation was always its view, to have updated its guidance accordingly. It did not do so for 2017. Even after the Supreme Court judgment of July 2018, one might have expected the new interpretation, which the Electoral Commission claims, again, to have supported throughout, to have found its way into the new guidance for local elections for 2019, published just two months ago. It did not.

In response to my Adjournment debate of 11 February and in advance of this ten-minute rule Bill today, the commission finally published guidance with examples on the vexed question of notional spending—an undated document that accompanied a letter to me of 8 March. This new guidance suggests that unauthorised expenditure becomes an election expense for reporting if there has been active engagement in the spending activity so that the “made use of” threshold is reached. It cannot be right that somebody’s liberty, reputation and livelihood can be at stake based on three words and a potential prosecutor’s interpretation of a candidate’s knowledge or otherwise of an activity that was not authorised.

The commission offers six examples in its new guidance, which, I am sorry to say, falls very short of helping. Example 5 suggests that a national party battle bus carrying the party leader would not be a candidate spend if the candidate refused to engage with the party leader and refused to meet them. If the party leader says nothing more than “Vote Conservative” or “Vote Labour”, for instance, this would be national party spend under the PPERA, but if the party leader mentions the candidate’s name while in the constituency, the leader might be committing a section 75 offence—and do not forget that that is an imprisonable offence. My right hon. Friend the Prime Minister might want to listen to that.

At example 6, if the local candidate agrees to join the party leader battle bus event and their name is mentioned, the commission suggests that an amount of notional spend must then be reported in the candidate spending return. Might that spending apportionment assessment be per word, or time-based—and, realistically, could the candidate have any control over what a party leader might say? Can anybody really imagine the implications for a candidate’s—potentially a new candidate’s—standing within their party of a refusal to engage with a party leader visiting their constituency? I am afraid that these examples highlight very clearly how removed from reality the commission is.

The Electoral Commission will suggest that any change to section 90C might lead to mischief if refusal to authorise would permit or encourage election-related spending to fall outside of account. There is already extensive sanction within section 75 of the RPA 1983 that would discourage such activity, as the person spending would face criminal prosecution and would be highly unlikely to play a part in such a planned deception. So the commission’s fears are unfounded. This Bill would make minor changes to section 90C to take away the ambiguity of the July 2018 Supreme Court judgment. The Lord Justices’ judgment has to be the right one. The Court’s status as the highest court means that it must be given the wording of the law as it stands. The question this House must now consider was whether the words previously agreed during the passage of the RPA 1983 represent the intention of Parliament and its drafters. I say that they do not.

Do Members in this place ever leave a lasting legacy by their activities here? The reason I promote this Bill is to protect current colleagues across this House, colleagues yet to come and councillors yet to face election. The desire to offer oneself for public service should not come with a threat to one’s liberty, reputation and career. I commend the Bill to the House.

Question put and agreed to.

Ordered,

That Craig Mackinlay, Paul Farrelly, Alex Chalk, Sir Peter Bottomley, Mr Mark Harper, Frank Field, Gareth Johnson, Mr Jonathan Lord, Jim Shannon, Anna Soubry and Bob Stewart present the Bill.

Craig Mackinlay accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 22 March and to be printed (Bill 357).