Electoral Administration Bill

I strongly support my noble friend Lord Goodhart in this set of amendments. I do not think that I need declare an interest. I have certainly never had £1 million and I have never lent or given £1 million to any organisation, let alone my beloved party. But my wife reminded me that, since I was elected a Liberal councillor in 1964, if I were to accumulate the earnings that I fear I have missed out on as a result of my political activity—I am sure that other Members of the Committee are in exactly the same position—it might be a very formidable sum. We may fear that it is an unhappy accident that your Lordships’ House is discussing this issue first, but I think that it is very appropriate. We must all recognise that the events of the past few weeks have damaged the reputation of your Lordships’ House—all of us, however we came here. Therefore, I think it is appropriate that we think very carefully about this issue over the next few days and deal with it urgently, as my noble friend Lord Goodhart has already said. As I was saying before I was so politely interrupted on Tuesday in the Committee’s consideration of this Bill, there are important implications for the way in which our elections take place, the composition of your Lordships’ House, the way in which political parties are funded and, most importantly, the way in which the public seem to be increasingly disengaged and disenchanted with the institutions of our country. It is a curious irony that, although there seems to be interest in political issues—among young people as much as any others—it does not translate into support for the political system. The recent report of the Power Commission, which I hope the noble Baroness has read, not only sets out in detail this disenchantment with the political life of this country but also makes a specific suggestion about party support and state funding in future. Not that it should be state funding—it should be triggered by the individual voter at local level in the ballot box with a tick system on the ballot paper. That would have huge advantages in terms of supporting local campaigning and local organisations rather than simply pouring money into central coffers. It would be extremely helpful in a number of ways—not least, it would encourage greater campaigning activity in safer seats. My noble friend said he thought the commission had been somewhat na&-uml;ve in not spotting this potential loophole. Since I was involved in the passage of the Political Parties, Elections and Referendums Bill in the other place, we did not spot this as a potential problem. In that sense, we are all guilty of naivety, but that is all it is; we were not all conspiracy theorists at the time, trying to find a way around the law. It is true that throughout the whole of the last century efforts were made to stop up loopholes that only became apparent when someone tried to fend their way around the spirit of the law, and in so doing evaded the letter of the law. The critical issue is transparency. I hope, when the Minister responds to our brief discussion today, and more specifically when she and her colleagues come forward with other amendments on Report, that transparency will be the guiding light. It is not fair to say that everyone who has ever given money to a political party should be excluded from honours. Personally, I would like to detach the whole honours system from representation in the legislature; those are two quite separate functions. It is noticeable that many of those who have most generously donated—I put it in those terms—to political parties, having accepted a title, have often not been assiduous attenders in your Lordships’ House. It may be that they were simply interested in the notepaper rather than the activity that should go with ennoblement. If that is the case, it is an additional reason for detaching one from the other. On the issue of transparency, I am particularly concerned with the issue to which my noble friend Lord Goodhart has just referred at the end of his remarks. It is possible that it was not only in an attempt to avoid publicity that some people made loans rather than straight donations, but it may be that they were not enabled—they were not eligible under the law—to make a donation because either they were foreign residents or they had no particular reason to be included in those who were eligible to make donations to political parties. Finally, the point my noble friend has just made about the difference between loans and donations in terms of continuing influence is incredibly important. If a loan is still outstanding, the terms of that loan—when interest is expected, let alone when repayment is expected—is of considerable interest to both parties to that loan. That is an influence that can continue. If an outright donation has been made, it may well be that the donor can be told thereafter that the favour he or she was expecting is not available: ““It is very sad; you have given us a million, but we haven’t got a place for you in the House of Lords””. But if there is a continuing commitment one way or the other, that influence can continue. I am reminded of the Eurosceptic millionaire who threatened that if Mr Ken Clarke became leader of the Conservative Party, that would be the last sum of money he would donate. Imagine if that had been a loan; a private, secret loan that had been in question at the time. His continuing influence over that party would surely have been totally anti-democratic, to be deplored by all of us in all parties. This is a very important issue, which goes to the heart of some of the most formidable concerns that the electorate has about the institutions of government. I make no apology for being anxious that we get it right this time. My noble friend Lord Goodhart and I wrote a pamphlet for the Centre for Reform as long ago as 2003 in which we identified some of these problems and made some suggestions to answer them. I do not believe we got it right then—we never get everything right—but we have to think very seriously in all parties about how we try and get it right now, not just to plug this particular loophole, not just to try and make transparency the order of the day, but to give people confidence again because it is sorely lacking at the moment.