Political Parties and Elections Bill

My Lords, the amendments both relate to early payment discounts for financial penalties imposed by the Electoral Commission. Amendment 16 would delete the reference to early payment discounts from paragraph 7(3)(b)(iii) of new Schedule 19C to the 2000 Act, which relates to the availability of early payment discounts or late payment penalties in a notice of a discretionary requirement imposed by the commission. Amendment 21 would remove paragraph 18(1)(a) of new Schedule 19C, which allows the Secretary of State to make a supplementary order to allow the commission to offer provision for early payment discounts for any of the monetary penalties contained in the Bill. Noble Lords present during Grand Committee may recall that we touched upon the provision of early payment discounts and of late payment penalties during our debate. An amendment on late payment penalties that was tabled and debated at Committee has not returned here. Following the endorsement that late payment penalties have received, I think we can safely suggest that a general consensus exists that this provision will be a useful tool for enforcement. That is certainly the expressed view of the Electoral Commission. However, the provision of early payment discounts has received less unanimous support. For those noble Lords not present at Committee, I reiterate that the provision of an early payment discount is replicated from the Regulatory Enforcement and Sanctions Act 2008, on which the civil sanctions regime is based. As I have said on a number of occasions, we are not minded to depart from that regime and treat the commission differently from other regulators unless there is the strongest possible reason for doing so. That is a view following that of the honourable Mr Howarth in another place. We need to provide an incentive for swift compliance in cases when liability is not going to be disputed, offering the opportunity for a person to deal with it in a timely fashion. The provision would therefore also reduce the workload that late payment would create for the commission and generally encourage compliance, helping to keep costs of enforcement down and bolstering the regulatory regime. The key point that needs to be made here is that, while the Bill provides for the possibility of these early payment discounts, it in no way requires them to be used. It simply allows that the statutory instrument, which will need to be passed in order to provide more detail about the sanctions procedure, may make provision about discounts. There is no obligation for it to do so. If a decision is made to allow for discounts in the statutory instrument, that instrument will be laid before Parliament and may be debated. If the statutory instrument allows for discounts, it will be a matter for the commission to decide when, if indeed at all, it will be appropriate for it to use this provision. Following its consultation on the draft enforcement guidance, it will be able to make a decision about whether to use them. Officials from the commission have indicated to us that, at present, they would be unlikely to use the early payment discount as part of the enforcement regime during its initial phase. However, we do not think that is a reason for leaving this provision out of the Bill altogether. If we were to remove that now and the commission later decided, in light of its practical experience of operating the sanctions, or of feedback from those subject to it, that early payment discounts added to the fairness or effectiveness of the regime, it would not be able to use them without further primary legislation. That makes the position inflexible. It makes sense to keep the option open and allow the commission the scope for using the same powers that are available to other regulators under the RES Act. I believe, therefore, that it would be more sensible to leave this provision in place. After all, the commission’s approach may need to adapt to the reality of operating the new civil sanctions, and we may not be able to say with confidence at this juncture that this provision will never be of any use. I will say that if we are persuaded by strong arguments on this, we could take another look at making a change and removing the provision for early payment discounts. But our present attitude is not to do so.