I thank Lord Mendelsohn for the amendment. This short debate has raised an important question about the proportionality of penalties for breaches in this area, and I want to emphasise the seriousness with which we should all view the requirements
and obligations on unions. The impact assessment helps us to have a useful discussion in this House. It reflects conventions—I do not always agree with the conventions, as I am sure noble Lords opposite will remember, but penalty estimates are one bit of good practice that is rightly included when these assessments are prepared. I emphasise that it is not a target. It is about encouraging good compliance, including as a deterrent, and creating and maintaining public confidence by removing those unfit for union office and ensuring accurate trade union registers. Union leadership elections or political fund rules and ballots should all be carried out according to due process. Any irregularities, quite rightly, would raise concerns and damage confidence among not only union members but employers and the wider public.
We intend that the maximum penalty would vary according to the seriousness of the breach. This is a normal approach among regulators. Within this maximum, the Certification Officer may also set a lower penalty, depending on the circumstances of the case. In a number of areas that the Certification Officer regulates, he is currently limited to being able to make an order requiring the union to correct a breach. There is nothing to sanction a union that has failed to comply with a requirement, no matter how significant the failure. The additional option of a financial penalty being applied will ensure that appropriate sanctions are available as a remedy and a deterrent, as I have said.