My Lords, these amendments address concerns raised by noble Lords in Committee and by campaigning groups in the discussions we have had with them. It is important to guard against the risk that significant donors might use third parties to aid political parties and evade the party spending controls. That is why at present third parties campaigning nationally during regulated elections are subject to rules on donations similar to those of political parties.
However, recognised third parties need to report only donations related to controlled spending, and currently are required to do this only once at the end of every campaign, as part of a return to the Electoral Commission after the relevant election, rather than at the regular intervals required of the political parties. Therefore, Clause 32 introduces important measures to improve transparency by ensuring that people know the source of reportable donations received by third parties during the regulated period via quarterly and weekly donation reports.
I hope that noble Lords support the principle of providing information on reportable donations during the election campaign. However, the Government acknowledged in Committee that the right balance needed to be struck between increased transparency and the avoidance of overly burdensome reporting requirements. As set out in the Bill, only third parties that are required to register with the Electoral Commission are required to provide reports on the donations they receive. The amendments that this House agreed earlier today to increase the registration thresholds mean that only third parties which incur controlled expenditure of more than £20,000 in England or more than £10,000 in each of Scotland, Wales or Northern Ireland will have to produce donation reports.
Furthermore, government Amendments 81 and 89 remove the need for recognised third parties to provide nil reports. Instead, a recognised third party will be required to provide a donations report to the Electoral Commission only when they receive a reportable donation. Only donations over £7,500 are reportable. If a third party does not receive a reportable large donation, they will not have to provide a report.
The Government have also brought forward amendments to take account of snap general elections. The Government accept that these provisions, while important in the regulated period for an election the date of which is known in advance, may cause problems if they were to be applied to an early parliamentary election. If a snap general election were to occur, third parties would have to provide weekly reports to the Electoral Commission only during the post-dissolution period, and then only if they receive a reportable donation. They would not have to prepare quarterly reports.
The Government believe that these amendments meet the concerns of charities, particularly in relation to the removal of nil reporting, which was a key area of concern for both the NCVO and the Commission on Civil Society and Democratic Engagement. They retain the vital transparency measures introduced by the Bill, but ensure that unnecessary burdens are not placed on campaigners.
I apologise to my noble friend Lord Hodgson, who asked me about nil returns in the debate we had on coalitions. I assure him that if a coalition spends less than the registration threshold, it will not have to produce a spending return. If a coalition does not receive a donation, it will not have to provide a nil return.
At present, recognised third parties have to provide details of their campaign income and expenditure to the Electoral Commission after a UK general parliamentary election and after the poll for certain other elections. Campaigners pointed out that many third parties register with the Electoral Commission with the intention of incurring controlled expenditure but at the end of the regulated period find that they have not spent above the registration threshold. While it is important to ensure transparency in spending any donations, we have listened carefully to the concerns of campaigners and, as I have said previously, we do not want to impose unnecessary administrative burdens, particularly on small campaigners.
To ensure that these provisions are proportionate, government Amendment 98 provides that a third party which registers with the Electoral Commission but does not incur controlled expenditure in excess of the required registration threshold does not have to submit a spending return or a statement of accounts. The intention is that a recognised third party should also have to prepare a report if its expenditure in a constituency, in the case of a regulated period involving a parliamentary election, exceeds the constituency threshold that will from now on apply to non-recognised third parties. We recognise that the amendment does not currently do that so we will bring forward a small amendment at Third Reading to put that right.
To improve transparency by providing a clearer understanding of the finance of those involved in elections and to align the reporting requirements of third parties more closely with those of political parties, the Bill provides that a statement of accounts should also be submitted to the Electoral Commission. To ensure that this additional obligation is proportionate, individuals would be excluded from this requirement. The Government believe that not to exclude individuals would result in an unwarranted intrusion into their personal financial matters. However, individuals who exceed the spending threshold would still be required to provide details of their campaign income and expenditure, as is currently the case.
Under the Bill as introduced, the Government also provided that those third parties, such as companies, charities and trade unions, which provide statements of accounts under another legislative framework that could be reviewed by the Commission would also be exempt from any requirement to provide a separate set of accounts.
Government Amendments 108 to 111 make minor amendments to improve the working of this arrangement. Government Amendment 112 provides that a statement of accounts can be sent to the Electoral Commission in a longer timeframe: within nine months of the end of the regulated period where they do not have to be audited, or 12 months where they do have to be audited.
Again, the Government believe that these amendments, alongside the existing provisions in the Bill, ensure that transparency is improved without overly burdensome requirements being placed on third parties. I therefore beg to move.
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