Electoral Administration Bill

– in the House of Lords at 4:03 pm on 7 June 2006.

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Photo of Baroness Hanham Baroness Hanham Deputy Chief Whip, Whips, Shadow Minister, Scotland, Shadow Minister, Transport, Shadow Minister, Communities and Local Government 4:12, 7 June 2006

moved Amendment No. 1:

After Clause 9, insert the following new clause—

"REGISTRATION OF SERVICE VOTERS: DUTY TO TAKE NECESSARY STEPS

In the 1983 Act omit subsections (3) and (4) of section 59 (supplemental provision as to members of forces and service voters) and insert after that section—

"59A REGISTRATION OF SERVICE VOTERS: DUTY TO TAKE NECESSARY STEPS

(1) Arrangements must be made by the appropriate government department for ensuring that every person having a service qualification by virtue of paragraph (a) or (b) of section 14(1) above—

(a) is registered to vote unless they make a request under subsection (2), and

(b) has (so far as circumstances permit) an effective opportunity of exercising from time to time as occasion may require the rights conferred on him by this Act in relation to—

(i) the making and cancellation of appointments of a proxy;

(ii) voting in person, by post or by proxy.

(2) A person having a service qualification by virtue of paragraph (a) or (b) of section 14(1) above is entitled to decline to be registered by the appropriate government department if he has registered, or declined to be registered, with his local authority.

(3) Arrangements must be made by the appropriate government department for securing that such person receives such instructions as to the effect of this Act and any regulations made under it, and such other assistance, as may be reasonably sufficient in connection with the exercise by that person and any spouse or civil partner of that person of any rights conferred on them as mentioned in subsection (1)(b).

(4) In subsections (1) to (3) "the appropriate government department" means, in relation to members of the forces, the Ministry of Defence, and in relation to any other person means the government department under which he is employed in the employment giving the service qualification.

(5) The Ministry of Defence must maintain, in relation to each member of the forces who provides information relating to his registration as an elector, a record of such information.

(6) The Ministry of Defence must make arrangements to enable each member of the forces to update annually the information recorded under subsection (5).

(7) In relation to persons having a service qualification by virtue of paragraph (c) of section 14(1), the British Council shall be under a corresponding obligation to that imposed by subsections (1) to (3) on the appropriate government department.""

Photo of Baroness Hanham Baroness Hanham Deputy Chief Whip, Whips, Shadow Minister, Scotland, Shadow Minister, Transport, Shadow Minister, Communities and Local Government

My Lords, ever since the introduction of this Bill—I want to stress that at its introduction last year it contained no provisions at all on service voters—members of my party, in particular, have been pressing for improvements to the current system for service voting.

My honourable friend in the Commons, Andrew Tyrie, initially raised this matter in connection with his concerns about the registration of service voters and the difficulties that had resulted from changes to the Representation of the People Act 2000, which led to changes in service voter registration. I then took up the issue in this House, and the noble Lord, Lord Garden, from the Liberal Democrats has also been pushing at it with me since Committee.

It is interesting to note that under the current system of service voting, only 46 per cent of servicemen and women and just 28 per cent of those overseas actually voted in the last election. As I said, at previous stages of the Bill in this House, we have been supported by the noble Lord, Lord Garden, who is an Air Marshal. He and I tabled joint amendments on Report to press the Government to amend the Bill to deal with the difficulties being experienced by service personnel, which these figures demonstrate, and difficulties with registration.

In yesterday's Daily Telegraph, a report of a survey on service voting, conducted by the Defence Analytical Services Agency, showed that only 60 per cent of service personnel were registered to vote at the last election. Clearly, something is wrong. Out of those who responded to the survey, 61 per cent were unaware that they had to re-register every year to vote and that figure rose to 71 per cent among those posted overseas. So in total only 46 per cent of armed services voters voted in the last election. That quick summary of the profile of service voters shows that the major problem for them is registering to vote.

On Report, the Minister promised to come back with a solution that would re-enfranchise Armed Forces personnel. I know the efforts that she has made to ensure that her amendments are on the Marshalled List today. I believe she has been very brave in the way in which she has dealt with that. I wish I could say that they go far enough and that I accept them wholeheartedly, but the Minister knows that I shall not do that. In our view, one ingredient is still missing. The amendments do not go far enough. I shall explain.

While subsection (1) of the government amendment is welcome, as it will enable Armed Forces personnel to remain on the register for up to five years—relieving them of the task of re-registering every year, which could be logistically impossible for them—I am seriously disappointed with the Government's proposals as set out in subsection (2). Subsection (2) is a smokescreen which gives a false sense of security to those who are passionate about ensuring that servicemen and women are in the best possible position to vote, if they wish. The government amendment merely requires the Ministry of Defence to secure,

"(so far as circumstances permit) an effective opportunity of exercising from time to time as occasion may require the rights", to register to vote, and,

"voting in person, by post or by proxy".

Not only does the amendment fail to put a duty on the Ministry of Defence to register armed services personnel to vote, but it also places a condition on fulfilling the provision of opportunity by stating that it must be done,

"so far as circumstances permit".

That is understandable when it relates to the casting of a vote which cannot be managed in the same way as registration. However, it is quite inadequate as regards the registering of personnel.

There is no reason why registration should not happen when people join the Army or while they are stationed in the United Kingdom. It is worth considering that the Army's conditions of employment divide into two distinct areas: entitlements and guidelines. I believe that the Minister's amendment would fall very firmly into the guidelines section. Perhaps I can quote from the Army's website. It describes the status of guidelines as,

"A Guideline represents something the Army will try to provide but may not always be able to guarantee".

Registration is at the heart of this issue. The survey tells us that 73 per cent of those who received an advisory booklet, Register to vote, did not get around to reading it. It is hardly surprising that registering oneself to vote is not at the top of the priority list when one is training to go to war or living in barracks in Basra. It is not unreasonable to expect that the Ministry of Defence should be required to ensure that the basic democratic right to vote is secured for all its personnel.

We have two amendments that go hand-in-hand to achieve registration among armed services personnel and to give them the most effective opportunity to vote. I must make it clear that Amendment No. 3 is a necessary consequential amendment to Amendment No. 1. Amendment No. 1 does exactly the same thing as subsection (2) of the government amendment, but it adds the duty on the Ministry of Defence to register servicemen and women and includes an opt-out should any individual wish to register either as a civilian or not at all. That is different from the current situation. Amendment No. 3 would leave out the unsatisfactory subsection (2) of the government amendment. Amendment No. 1 would effectively replace that subsection by inserting new Section 59A, "Registration of service voters: duty to take necessary steps", into the 1983 Act.

The Minister will be aware that, under current electoral law, householders have a duty to provide an electoral registration officer with information of all eligible voters in their household. I see no reason why that widely accepted principle should not apply to the Ministry of Defence. It is, after all, a most unusual employer. We want to ensure that, in the same way that all members of the armed services are entitled to accommodation, for example, they are also entitled to be registered to vote.

In a recent telephone call, the Electoral Commission expressed its support for our amendments, stating that they would achieve all its objectives as set out in its response to the Government. In its briefing, the Electoral Commission expressed the need for the government amendment to go further:

"We would strongly recommend that these provisions are introduced as part of a wider package of measures to ensure that members of the Armed Forces are registered to vote, and to avoid the risks of fraud associated with extending the service declaration period".

The government amendment fails to require the Ministry of Defence to take action. The proposed new subsection (3A) in government Amendment No. 2 seemed to offer a glimmer of hope:

"Arrangements must be made by the appropriate government department for securing that such person receives such instructions as to the effect of this Act and any regulations made under it".

While that is all right, and would be helpful, there is no room in that provision for giving the Ministry of Defence the responsibility to register its personnel. Rather, it puts the onus back onto the individuals in the forces, from where the current difficulties arose.

My amendment does not seek to force people to register or vote. It seeks to force the Ministry of Defence, which has a duty of care towards its very special employees, to ensure that the best opportunity is available to them to vote. The only way that they can guarantee that opportunity is by actively securing the registration of servicemen and women. It is clear that registration is a keystone of improving voting among the armed services. What is more, it has received support across the board from the beginning. The Minister in another place, Harriet Harman, stated that she was baffled that the Government had not been able to get the rocket science working to register Armed Forces personnel. In this House, the noble Lord, Lord Ramsbotham, who is not in his place today, spoke from great experience as former Adjutant-General when he told noble Lords that he had been concerned about the difficulties put in the way of service voters, and pleased about the progress made under the 1983 Act which gave the Ministry of Defence the duty to register servicemen and women.

The noble Lord, Lord Garden, repeatedly emphasised the importance of registration in his speeches in Committee and on Report. I absolutely agreed with him when he said that the problem is that the Ministry of Defence will not take responsibility for sorting it out, which, he said, goes back to the Ministry having abandoned the arrangements in place before 2001.

I understand that the Ministry of Defence is reluctant to take on responsibility for registering its members. I remind the House again, however, that it is not an ordinary employer. The military covenant, as described in the British Army pamphlet Basically Fair: Equality and Diversity in the British Army, states:

"As a soldier you are expected to put the needs of the Service first and to forgo some of the rights enjoyed in civilian life. In return you can at all times expect to be treated fairly, and to be valued and respected as an individual".

As I said at the beginning, the Government have moved a long way on this matter. But by not putting a duty on the Ministry of Defence to undertake the registration, they are not ensuring that registration will be total in as far as it can be. We are in terrible danger of missing a great opportunity in this Bill to make a radical improvement to this part of the lives of soldiers and other personnel. Perhaps today we can rise to the challenge of ensuring that while dedicated people train and fight in the interests of their country, their Government are doing everything they can to ensure their most basic of rights: the right to vote. I beg to move.

Photo of Lord Astor of Hever Lord Astor of Hever Deputy Chief Whip, Whips, Shadow Minister, Defence, Shadow Minister, Foreign Affairs, Shadow Minister, International Development

My Lords, I support my noble friend Lady Hanham. Following her eloquent description of the issue at hand, I will be brief. Since the last general election, it has been clear that voter registration arrangements in the armed services leave much to be desired. The Government have come back with a suggestion that goes some way to improving the opportunity for the armed services to vote, but I agree with my noble friend that their amendment does not go far enough. We need to tackle this issue head-on by holding the MoD to account by reintroducing the duty to register servicemen and women to vote, with an opt-out clause. I commend noble Lords who have supported us in the past, particularly the noble Lord, Lord Garden, who supported my noble friend on Report. I hope those noble Lords will continue to support us to ensure that this matter is finally resolved.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, I thank the noble Baroness for her comments on the role I played on this, and I thank your Lordships' House for the patience with which it has allowed this issue to be dealt with. The noble Baroness is right to say that from the beginning of the Bill, my honourable and right honourable friends in another place from the Department for Constitutional Affairs have indicated that this issue has to be addressed. I join the noble Baroness in paying tribute to all those—including Andrew Tyrie, the noble Lord, Lord Garden, and many others—who have contributed to the debate and made clear their strong feeling that we need to address this subject. I would also like to pay tribute to my right honourable friend Des Browne who, on taking over as Secretary of State for Defence, was immediately extraordinarily receptive to the issues that I raised with him. On that basis, I was able to bring forward the amendments that are before your Lordships' House today, as I promised I would.

I take seriously what the noble Baroness and the noble Lord said, and I carefully considered all the questions that the noble Baroness raised both in your Lordships' House and beyond it. I pay tribute to her for the way in which she has enabled me to have that dialogue, which has been so important. In the remarks that I am going to make, I hope to try to win her and her colleagues over, not least by putting forward the context of this amendment. As the noble Baroness rightly indicated, it is important to see this as part of a broader package. However, this package is different from the one that she suggested.

I shall explain precisely what the amendments do, and I have already indicated that they are part of a wider package. The amendment makes the registration process more convenient for service personnel. As noble Lords will see, the amendments to Section 59 of the 1983 Act require the Ministry of Defence to keep a record of the registration arrangements of service personnel, where those personnel wish it to do so and have volunteered the relevant information. The earlier part of the amendment, which amends Section 15 of the 1983 Act, creates a power that will enable the Government to extend the duration of the electoral registration of a member of the Armed Forces resulting from a service declaration. That responds to one of the points the noble Baroness raised about the survey—I hope noble Lords have had a chance to look at it; there are copies in the Library of your Lordships' House. People were concerned about needing to re-register. That provision will come to your Lordships' House to be approved, and it is an important element. Its purpose is to make registration more convenient for those who choose to register through a service qualification. Those people could register for an extended length of time, as opposed to annually—that addresses the point that I have made—which would make it particularly convenient for those who are overseas.

The amendment does not restrict service personnel to registering solely through a service declaration. Noble Lords who have participated or followed our debates will know that on a number of occasions we have discussed the question of being able to choose to register locally, the potential benefits that people have identified in so doing and their desire not to see us revert to being able to register purely through a service declaration. I will not go into those again; I think noble Lords are aware of them.

The second half of the amendment places a duty on the MoD to keep a record of the electoral registration details of service personnel, to maintain and update that information provided by service personnel about their registration as electors and by what method they are registered to vote. That will then act as a prompt to the individual to update registration details with the local registration officer—most particularly updating the address to which postal votes should be redirected—and enable efforts to be focused on encouraging them to register. It will provide the kind of statistical information that will allow monitoring on a continuous basis, which I know will be very important as noble Lords seek to see that this works in fact. It will also facilitate communication between the unit registration officers and the local ERO regarding the numbers registered and assist in future registration campaigns.

I want to put this in the context of other measures that the Ministry of Defence has decided it would like to have as part of a package of measures. These include closer co-operation between the officer in each unit with responsibility for electoral registration and the local ERO, which is an important part of ensuring that this works well, and ensuring that the MoD issues every new entrant into the Armed Forces with an electoral registration form. The MoD will run campaigns during the annual canvass for service personnel whose service declaration is set to expire. Service personnel will receive reminders in payslips about registering to vote, giving such information as website addresses that they can reach. Access will be granted to service accommodation for electoral registration officers.

Pilot schemes for on-site polling stations are being set up at two separate military establishments—in the Rushmoor and Westminster authorities. Future campaigns will include a service "Registration Day", which will act as a focal point for the campaign when unit registration officers will proactively use all appropriate measures to remind and inform service personnel and their families of the requirement to register to vote and how to do so.

I think that fits well with what the Electoral Commission said in its briefing dated June 2006, which I have before me. As the noble Baroness rightly said, the Electoral Commission asks, "What more can you do?" It is looking for additional measures that would not require further changes to primary legislation but which could include some of the issues I have already raised.

The noble Baroness said that we have not gone far enough. I hope that, having put the matter in context, I have at least begun to reassure her that, as part of a package of things, this is an important measure that I am delighted to be able to bring to your Lordships' House, having accepted that noble Lords have been extremely active in ensuring that I did bring it to your Lordships' House.

The fundamental difference between us is on whom we put the duty or responsibility for this action. The way our electoral law has worked and the way we have always seen the issue of registration is that the duty and responsibility lies with the individual. I recognise entirely what the noble Baroness says about the difference of the employer status of the Armed Forces. Noble Lords will know that there are other employers who perhaps have people overseas, but I recognise and completely accept the particular significance for the Armed Forces. We do not believe it is right to put the onus on the employer, but rather to work with the employer in these particular circumstances to help to enable the individual to accept and respond to his duty and responsibility.

We do not think it is right to treat a government department differently from any other employer as noble Lords could well bring forward other cases involving particular circumstances. We think it is right and proper though that this particular employer should take additional action and be seen to be very positively encouraging people, who carry out for us the most significant of tasks, to register.

Of course there will be resources implications in what the noble Baroness is suggesting. I will not go into those because that is not at the heart of the matter. I think that it is very important that we recognise what we are seeking to do.

I know that I will probably have disappointed the noble Baroness, but I hope that noble Lords will see that in what we propose, we stick with the principle that it is for the individual to take that responsibility. We should not shirk from that, but it is absolutely right and proper—I pay tribute to all those who have helped me to get this far with the amendment—that we do all that we possibly can to ensure that they can do so. I hope that noble Lords will accept my amendment.

Photo of Lord Garden Lord Garden Spokesperson in the Lords, Defence 4:30, 7 June 2006

My Lords, I support the government amendment and, for the first time during this process, I do not propose an amendment because I am familiar with all the words in the government amendment. If the noble Baroness, Lady Hanham, thinks that the amendment is a smokescreen, I must admit to some of it being my smokescreen, because many of the words, thoughts and concepts there are in the amendment that I have been pushing at each previous stage of the Bill.

I am entirely content that the amendment achieves what we were after, which is to facilitate the registration and voting process by getting the MoD to consider it but, most importantly, putting a duty on the MoD to keep an index of the annual registration process. I am convinced that that will do what the Conservative amendment is intended to do: force the MoD to go through the process every year. There will then be a co-operative MoD; that has been the difficulty. I know that there has been more difficulty with that aspect than anything else.

The government amendment has one addition, which was not proposed by me, which is the delegated power for the Secretary of State to extend the registration period for up to five years. The Delegated Powers and Regulatory Reform Committee on which I serve—I notice that the noble Lord, Lord Dahrendorf, who is its chairman, is in his place—has not, because of the lateness of this amendment, had an opportunity to take a view on it. I can say only personally that, because of the narrowness of the power and its clear intent, I find it entirely appropriate.

However, I hope that it will not be necessary to use that delegated power. If the Ministry of Defence takes up its duty with enthusiasm, we can operate with servicemen and servicewomen on the same basis as the rest of our citizens and will not need to go down the route of special arrangements that may be confusing and have some of the drawbacks that we had with permanent registration before. It is a useful power to have up the sleeve but not necessarily one that will need to be used.

I fear that I must introduce one note of discord; I am sorry. Various noble Lords have talked about the results of the Defence Analytical Services Agency Service Voting Survey 2005, which was undertaken in autumn 2005. I have been pressing for us to see it; it would have informed our discussion because we could have drawn on it to make our amendments as good as possible. Despite the final report being available in March, the Ministry of Defence did not release it to your Lordships until Monday; it arrived to me in the post on Tuesday. In the Written Statement that accompanies it, the noble Lord, Lord Drayson, treats the survey results as though they are accurate. He says that it,

"gives us hard facts to target future work".—[Hansard, 5/6/06; col. WS 65.]

The letter that I received from the responsible Minister in the other place, Tom Watson, similarly suggests that the results are clear.

In our debate so far, we have been taking those percentages as though they were carved in tablets of stone. In fact, paragraph 1.6 of the report, entitled "Limitations of the research", shows that the overall response rate to the survey was only 45 per cent. In the key area of the Army (other ranks based overseas), only 26 per cent bothered to return the survey. The report draws the following conclusion from that:

"Personnel who did not respond may have different voting and registration experiences to those who did. It is not possible to ascertain if this is true or to quantify the size of any effect".

In other words, if the people who fail to return survey forms tend also to be the people who fail to return electoral registration forms—which is not an unreasonable assumption—the statistics may be much worse than the already terrible figure of 28 per cent reported for those overseas who managed to vote in the 2005 election. I hope the Ministry of Defence intends to do less spinning of the statistics in the future and a little more working-out of how this legislation can improve voting opportunities for its people. In particular, it will need to address the mechanics of making overseas postal voting possible. We look forward to the update, which is promised every year, to this survey. We will have much better figures on registration because of what is in the Bill, but we will need to have better figures on how much effect we are having on voting as opposed simply to registration.

Finally, I thank the Minister personally for all the effort that she and her staff in the Department for Constitutional Affairs have put into getting where we have got to today. We have also had great support from the Electoral Commission, from the British Forces Broadcasting Service, from parliamentarians across both Houses and all the parties, and from a number of electoral registration officers who, in the light of what the Minister said about the package, will now find their relationships with MoD establishments much easier, which is important.

The real hero, however, has been a retired Army officer called Douglas Young, the author of a report called Silence in the Ranks. He used the power of the internet through the Army Rumour Service network to identify the scale of the problem, and he gave helpful advice to servicemen and servicewomen on that website, so we got a better response in 2005 than we would have done otherwise. He also spotted errors in the official information on MoD and local authority websites, and he mounted the campaign to right what we have all agreed is a wrong. The chain of command has not come out of this with distinction, having shown a reluctance to tackle the problem. It is perhaps scarcely surprising that this week has also seen the launch of the British Armed Forces Federation. I am sure we shall return to that when we consider the Armed Forces Bill in the coming weeks.

Photo of Baroness Hanham Baroness Hanham Deputy Chief Whip, Whips, Shadow Minister, Scotland, Shadow Minister, Transport, Shadow Minister, Communities and Local Government

My Lords, I thank both the Minister and the noble Lord, Lord Garden, for what they said. I also thank the Minister for her explanation of the package, which she has described as a package that the MoD is putting together to encourage the registration of service personnel. But it is still only an encouragement; it is not a requirement or a duty. It may all work out perfectly wonderfully, and the noble Lord, Lord Garden, may be correct that everything in the legislation will do what he and I have been trying to achieve in the past few weeks, but I am afraid that I am still not convinced that that is so.

I said in my opening remarks that there is a requirement on a householder. Noble Lords may not see the direct correlation, but a householder is required to register all the people who live in their house. It seems to me that the Ministry of Defence is very much in that position. It is the householder and knows who it has under its roof. It knows where those people are— at least, I hope it does. It is meant to know where they are, and it is meant to ensure that they have the opportunity and the rights that they should have.

I do not think the Minister will be surprised by my seeking to divide on this; it comes from no sense of animosity, because I do think we have moved an enormously long way, but if I could secure the last bit of this, I think we would have the perfect amendment for the perfect result that we have all been looking for. I seek to test the opinion of the House.

On Question, Whether the said amendment (No. 1) shall be agreed to?

Their Lordships divided: Contents, 116; Not-Contents, 203.

Division number 1 Private Parking: Ports and Trading Estates — Electoral Administration Bill

Aye: 114 Members of the House of Lords

No: 201 Members of the House of Lords

Aye: A-Z by last name

Tellers

No: A-Z by last name

Tellers

Resolved in the negative, and amendment disagreed to accordingly.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs) 4:56, 7 June 2006

moved Amendment No. 2:

After Clause 12, insert the following new clause—

"REGISTRATION IN PURSUANCE OF SERVICE DECLARATION

(1) In section 15 of the 1983 Act (service declaration), after subsection (8) insert—

"(9) The Secretary of State may by order provide that, in relation to the persons mentioned in section 14(1)(a) and (d), subsection (2)(a) above has effect as if for the period of 12 months there were substituted such other period (not exceeding five years) as he thinks appropriate.

(10) The power to make an order under subsection (9) is exercisable by statutory instrument, which may contain such incidental or consequential provision as the Secretary of State thinks appropriate.

(11) No order may be made under subsection (9) unless—

(a) the Secretary of State first consults the Electoral Commission, and

(b) a draft of the instrument containing the order is laid before, and approved by a resolution of, each House of Parliament.

(12) If the period substituted by an order under subsection (9) is longer than the period for the time being in force, the longer period has effect in relation to any person who immediately before the order was made was entitled to remain in a register by virtue of subsection (2)."

(2) In section 59 of that Act (supplemental provisions as to members of forces and service voters), for subsection (3) substitute—

"(3) Arrangements must be made by the appropriate government department for securing that every person having a service qualification by virtue of paragraph (a) or (b) of section 14(1) above has (so far as circumstances permit) an effective opportunity of exercising from time to time as occasion may require the rights conferred on him by this Act in relation to—

(a) registration in a register of electors (and in particular in relation to the making and cancellation of service declarations);

(b) the making and cancellation of appointments of a proxy;

(c) voting in person, by post or by proxy.

(3A) Arrangements must be made by the appropriate government department for securing that such person receives such instructions as to the effect of this Act and any regulations made under it, and such other assistance, as may be reasonably sufficient in connection with the exercise by that person and any spouse or civil partner of that person of any rights conferred on them as mentioned above.

(3B) In subsections (3) and (3A) "the appropriate government department" means, in relation to members of the forces, the Ministry of Defence, and in relation to any other person means the government department under which he is employed in the employment giving the service qualification.

(3C) The Ministry of Defence must maintain, in relation to each member of the forces who provides information relating to his registration as an elector, a record of such information.

(3D) The Ministry of Defence must make arrangements to enable each member of the forces to update annually the information recorded under subsection (3C)."

(3) In section 59(4) of that Act, for "subsection (3)" substitute "subsections (3) and (3A)"."

[Amendment No. 3, as an amendment to Amendment No. 2, not moved.]

On Question, amendment agreed to.

Photo of Baroness Hanham Baroness Hanham Deputy Chief Whip, Whips, Shadow Minister, Scotland, Shadow Minister, Transport, Shadow Minister, Communities and Local Government

moved Amendment No. 4:

After Clause 13, insert the following new clause—

"REGISTRATION: PERSONAL IDENTIFIERS

(1) The 1983 Act is amended as follows.

(2) In section 10 (maintenance of registers: annual canvass), after subsection (4) insert—

"(4A) Subject to subsection (4B) below, the information to be obtained by the use of such a form for the purpose of a canvass shall include—

(a) the signature of each of the persons in relation to whom the form is completed, and

(b) the date of birth of each such person.

(4B) The Chief Electoral Officer may dispense with the requirement mentioned in subsection (4A)(a) above in relation to any person if he is satisfied that it is not reasonably practicable for that person to sign in a consistent and distinctive way because of any incapability of his or because he is unable to read."

(3) In section 10A (maintenance of registers: registration of electors)—

(a) after subsection (1B) insert—

"(1C) Subject to subsection (1D) below, an application for registration in respect of an address in England, Scotland or Wales shall include—

(a) the signature of each of the persons to whom the application relates, and

(b) the date of birth of each such person.

(1D) The Chief Electoral Officer may dispense with the requirement mentioned in subsection (4A)(a) above in relation to any person if he is satisfied that it is not reasonably practicable for that person to sign in a consistent and distinctive way because of any incapability of his or because he is unable to read.";

(b) in subsection (5), at the beginning insert "Subject to subsection (5A) below,";

(c) after subsection (5) insert—

"(5A) A person's name is to be removed from the register in respect of any address if—

(a) the form mentioned in section 10(4) above in respect of that address does not include all the information relating to him required by section 10(4A) above; or

(b) the registration officer determines that he is not satisfied with the information relating to that person which was included in that form pursuant to that requirement.";

(d) in subsection (6), after "above" insert "or his name is to be removed from it by virtue of subsection (5A) above,"; and

(e) in subsection (8), after "5" insert ", (5A)".

(4) In section 13A (alteration of registers), after subsection (2B) insert—

"(2C) Subject to subsection (2D) below, an application for registration under subsection (1)(a) above in respect of an address in the United Kingdom shall include—

(a) the signature of each of the persons to whom the application relates, and

(b) the date of birth of each such person.

(2D) The Chief Electoral Officer may dispense with the requirement mentioned in subsection (4A)(a) above in relation to any person if he is satisfied that it is not reasonably practicable for that person to sign in a consistent and distinctive way because of any incapability of his or because he is unable to read.""

Photo of Baroness Hanham Baroness Hanham Deputy Chief Whip, Whips, Shadow Minister, Scotland, Shadow Minister, Transport, Shadow Minister, Communities and Local Government

My Lords, I hope that I am on much less controversial ground here, and I know that the Minister will give way on this amendment without a moment's thought.

The amendment returns us to an issue which we have debated in great detail throughout the passage of the Bill. I was disappointed to find on Report that my amendments on personal identifiers would have been destroyed by the government clause stand part amendments, but I was glad to be able to go away to redraft the amendment in a form that is more amenable to noble Lords today.

The amendment would require a signature and date of birth to be included in all voters' registration and not only in that of postal voters, which is already in the Bill. It would not interfere with arrangements as they stand in Northern Ireland, which I still believe to be the best option. A signature and date of birth are extremely easy to find: the one, you can simply write down; and the other, it is to be hoped you can remember.

While I would still very much like to see national insurance numbers added as a personal identifier for voter registration, I have argued myself into the ground about it and I accept that noble Lords are not in favour of the idea. I am prepared to leave it to simmer until another opportunity arises to get it on the statute book, perhaps at a time when we find that a signature and date of birth are not quite sufficient as identifiers. However, what we want to secure at this stage is some form of personal identifiers for voting.

Noble Lords will be aware of the Electoral Commission's campaign for personal identifiers. From the outset of the Bill, it has called for personal identifiers to be introduced, first into all-postal voting, and then, via a transitional arrangement, into the national canvass. It was pointed out in Committee that to say to people on the national non-postal canvass that they could sign if they wanted to, via the commission's proposed transitional scheme, would not yield an effective result—and I agree with that.

So why postpone a good idea? The amendment regarding personal identifiers for postal voting which was introduced by the Government on Report was very welcome. It was the result of hard work by me and the noble Lords, Lord Elder and Lord Rennard—we all managed to agree at the same time—but we can go still further. Noble Lords will have read about the recent fraud in Coventry, where people who were in Pakistan somehow managed to vote in person at the polling station at the same time. This is just one in a long line of cases where identity has allegedly been impersonated at the polling station. The use of personal identifiers across the board would go a long way towards protecting individuals from this kind of fraud as well.

The Minister has spoken in support of the principle of this amendment time and time again. In Committee, she stated that,

"collecting personal identifiers has the potential to improve security and integrity in the electoral process".—[Official Report, 16/03/06; col. GC 593.]

I was pleased to re-read that in Hansard and I am confident that my amendment strikes precisely the right balance between creating a safeguard against fraud and preventing the over-complication of registering to vote. At that stage the Minister also expressed her strong views about making sure that forms requesting information from people should be as simple and straightforward as possible.

Provisions under Schedule 1 require voters to sign for their ballot paper at the polling station. Our amendment would therefore introduce a further check against fraud. Those registering to vote would provide a signature that would go on the register, which would then provide a check at the polling station. I do not see how the provision of a signature at the polling station will be of any use if there is no register of the original signature in the first place. What is more, our amendment would save voters the worry of finding a legitimate counterfoil to prove that their signature is theirs.

I very much hope that noble Lords can support the amendment. In my view it would make a great contribution to the prevention of electoral fraud while retaining simplicity of information. I beg to move.

Photo of Lord Rennard Lord Rennard Liberal Democrat 5:00, 7 June 2006

My Lords, the amendment raises issues that are very much at the heart of the fundamental purpose of the Bill—to minimise fears of electoral fraud.

Today we hear that there are no fewer than eight petitions in the High Court alleging electoral fraud in the recent local elections. There are, of course, allegations of fraud in many other areas, and we do not know the scale of it. It is an issue of ongoing concern, which will not end with consideration of the Bill.

The Bill contains many provisions to deal with the potential for, and perception of, fraud, and to increase confidence in the electoral process, which have been welcomed on all sides of the House. Some welcome shifts have taken place on how we might deal with the issue in future. I very much welcome the fact that the noble Baroness, Lady Hanham, is no longer pursuing national insurance numbers being a requirement for electoral registration. For me that was a step too far in trying to clamp down on fraud.

I also welcome the fact that the noble Baroness, Lady Ashton, with helpful encouragement from the noble Lord, Lord Elder, has accepted that the date of birth should be required on postal vote applications. However, I am still not confident that the Bill will do as much as it should to prevent, deter and help to detect fraud in arrangements for postal voting.

The amendment requires a signature and date of birth for everyone going on to the voting register. Indeed, there can be few legal forms that entitle you to do something and involve a legal requirement that you have to complete which do not require a signature. It is suggested that it would be difficult to do this on the form. But many of us with a close interest in the electoral process who are used to people filling in forms, including the form on which you apply to vote by post, do not think that it would be so difficult to require a signature on the form.

During the Bill's passage the Government have accepted that a signature and a date of birth should be required on a form on which you apply for a postal vote, so how can it be so difficult to suggest that someone should provide a signature and a date of birth to be included on the electoral register? Recently I looked at my own voter registration form from the London borough of Lambeth. It is a clear example of a form where any change to the people listed on it requires a signature and a date of birth. It is not a complicated form that is difficult to complete. Certainly, it is easier than filling in a national lottery ticket, which I have never succeeded in understanding or filling in myself.

There are, of course, remedies for any problems with people failing to return the registration form because it requires a signature and a date of birth. Some of those remedies are already in the Bill and are very much welcomed. Door-to-door canvassing constitutes a large part of addressing problems of low electoral registration. A very significant reason for the decline in the quality of our electoral register over the past 20 years or so is because local authorities have cut back in that area as they felt squeezed and obliged to deal with other matters.

There is still great disquiet in this country about the potential for electoral fraud. That has grown significantly over the past few years, since the point at which we granted an automatic entitlement to vote by post but failed to provide proper safeguards at the same time. We can do many things in the Bill to help put that right, but we could go further and do better on the issue. There remains for some noble Lords the need for independent advice on this issue that does not come from any partisan source. I suggest that the only appropriate source of advice on something such as this is the Electoral Commission, with which we may agree or disagree on occasions. I asked it again today to state its position on this issue. It told me this morning:

"The Commission remains committed to the principle of individual registration and welcomes the intention of amendments to introduce personal identifier requirements at registration. The Commission continues to believe that a system of individual registration would allow voters to participate with confidence in the electoral process".

So do I.

Photo of Lord Campbell-Savours Lord Campbell-Savours Labour

My Lords, I had not intended to speak, as I thought after the very substantial debate that we had on these matters in Committee that we had formed a sort of consensus view on how to proceed. However, it seems that we have an amendment today that would establish, as I understood it on my preliminary reading, a national roll-out of individual registration in all conditions.

I will use my words with very great care in the light of the amendments that I moved in Committee, but I will say this. There is a tradition in this country of liberty and tolerance. In recent years, practices that many of us find alien have been brought into our electoral arrangements. Those practices appear to take place in very few parts of the country. I am at a loss to understand why we should punish the whole nation for the sins of a few, when the sins of the few take place only in a very small number of areas of the United Kingdom. My amendments in Committee very sensitively dealt with that issue, by suggesting that local authorities—where they believed that a particular problem existed—should have the right to apply for the introduction of a scheme whereby individual identifiers on the basis that the noble Baroness has presented would be required.

There was a feeling among Members of the Committee that the issue was sensitive and that we should not go down that particular route; but I still believe that we should go down that route. I do not believe that it is right that we should require a system that is onerous to be applied nationally to every citizen that votes in the United Kingdom because of what has happened in certain parts of the United Kingdom, in very small areas, when we could deal with those problems in isolation on the basis of the amendments that I proposed. It is wrong that we should go down that route. I shall say no more on this occasion other than that I hope, in the event that the amendment is carried today, that there are people at the other end who understand the concerns that I am expressing, who subscribe to the same view that we should preserve the arrangements based on tolerance that have existed over the past 150 years, and who believe that we should maintain that kind of arrangement and not simply punish everyone for the sins of a few.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, I am grateful to all noble Lords who have spoken. I seem to be setting myself a trend by beginning each of my contributions by paying tribute to the noble Lords who have helped me in understanding these issues. I pay tribute to the noble Baroness, Lady Hanham, to my noble friend Lord Elder, who is not in his place today, and to the noble Lord, Lord Rennard. This significant trio have been extremely helpful in allowing me to think through what we might do. I will briefly recap how we got to where we are at now, and I will explain why I will not accept the amendment.

We began by looking at the whole question of personal identifiers in the context of making sure that the democracy that we hold to be one of the most precious things in this country is maintained and robust, and that anything that we do to our system is tried and tested. That is a fundamental principle around anything to do with this legislation or any legislation on elections; after all, the most fundamental thing that we give our citizens is the right to vote in or out their Government, local authorities and so on. To do anything different of which we are unsure of the outcome is very difficult, and something that I could not and do not support. There is a great deal of interest in personal identifiers for good and honourable reasons that I understand completely. Of the eight petitions before the courts, four concern fraud, three of which we believe—on a cursory look, I have to say—would be well assisted by the amendments already made to this legislation, a process led by my noble friend Lord Elder and supported by others.

We started off by saying, "We may want to look more closely at personal identifiers". In a sense, we were originally presented with two options, particularly in another place. The first was the transitional scheme put forward by the Electoral Commission initially. It was supported by many Members of your Lordships' House, but the House rejected it in the end primarily for the reason that the noble Baroness, Lady Hanham, alluded to. That was that, if you have a voluntary scheme, two things happen: you make the form more difficult to understand because you have to state that people may or may not provide additional information; and it carries all the risks of a self-selecting scheme, in that those who feel comfortable providing the information do so, but it tells you nothing about the people who choose not to provide it. The scheme that came to us from another place was to have pilots in various parts of the country; we talked about having 10. Again, there were real concerns about that, such as who would choose the pilots, whether they would be self-selecting, and the fact that work done on a pilot basis does not necessarily give the results that would happen across the country because of the differences in the way in which different parts of the country might operate. Many reasons were put forward with vigour by Members of your Lordships' House, both in the House and outside, and I certainly listened carefully to what was said.

Then we had the amendment moved by my noble friend, but which I entirely accept came in a sense from this House. It is now incorporated into the part of the legislation concerning postal voters. We have sought to address significant issues in the Bill and, in a range of ways, concerns about postal fraud expressed elsewhere which were dealt with by my right honourable friend Harriet Harman when she had responsibility for this portfolio. We accepted that my noble friend's amendment helped us in two ways. First, it further and significantly dealt with that issue. Secondly and as importantly, it gave us the best possible way to test the impact of personal identifiers, because it was national—everywhere—and for anybody who wanted a postal vote; they would provide information. We could evaluate it, look at what happened and reach serious and sensible conclusions. In other words, it did not have any of the difficulties with the transitional or pilot schemes that noble Lords rejected, for good reasons one way or another.

That is where in a sense I stop, because I am not prepared to go further at this stage. If we recognise the need to be sure about the implications of what we are doing, we must recognise the need to find out what occurs. The noble Baroness, Lady Hanham, understandably talks about the Northern Ireland experience. We know that the registration system in Northern Ireland faces significant reform; noble Lords who will be here for the Second Reading later will see that. The Northern Ireland (Miscellaneous Provisions) Bill scraps the annual canvass. The aim is for the canvass to take place only every 10 years, with more frequent audits if the register becomes inaccurate. Once registered, a person will remain on the register until they change address, with the inclusion of more data to keep the records up to date. It is hoped that that will improve the accuracy of the scheme in Northern Ireland.

However, I indicated that there were significant difficulties with the number of people on the register when the scheme was introduced in Northern Ireland. Our elected representatives of all parties in another place have indicated their genuine concerns about the potential for some people to feel unable to supply that additional information for a variety of reasons, which could lead to a significant drop in the number of people on the register.

I began by saying that our democracy is precious. That is because we want everyone who can vote to be registered to vote and to exercise their right to do so. That would represent the ultimate healthy democracy. Of course, we want to make sure that only those who are entitled to vote do so and we are looking for a way of achieving all our objectives at the same time. There is a danger in moving directly to a personal identifier scheme, given that the only experience of that demonstrated that there were significant problems, which led to the need for new legislation. It would not be responsible of me, as a government Minister or as an individual, to say that we should move directly to that without testing it.

I made it clear on Report, when we accepted my noble friend Lord Elder's amendments, that we were keen to evaluate and to work closely on these issues with the Electoral Commission, Members of your Lordships' House, who have an important and significant role to play, and especially elected Members in another place. We want to keep our system free from fraud. I would not wish to accept the amendment and potentially have a serious effect on the number of people who register.

For that reason, and only that reason—because I entirely understand the principle behind the amendment and I know the position of the Liberal Democrats—it would be a serious error to move directly to a situation that might seriously damage the register. That view is based on experience that demonstrated that there were significant problems. As the Bill stands, and given all the additional security measures that I have mentioned, we have the potential to evaluate properly and move further forward. So I hope that the noble Baroness will not press her amendment.

Photo of Baroness Hanham Baroness Hanham Deputy Chief Whip, Whips, Shadow Minister, Scotland, Shadow Minister, Transport, Shadow Minister, Communities and Local Government 5:15, 7 June 2006

My Lords, I thank the Minister for her passionate reply—I was going to say, "by her standards", but I do not mean that, because she is often very passionate and direct. I fully understand what she is saying. I also partially understand the concerns raised by the noble Lord, Lord Campbell-Savours, who helped a lot during the passage of the Bill.

My concerns, which, I understand, are shared by the noble Lord, Lord Rennard, relate to the fact that fraud appears to be becoming more widespread. There seem to be more opportunities for people to personate in polling stations and to get themselves on the register. Regarding the extension of what we have already agreed to, across the piece in this House, we have all come to the same conclusion on the postal vote. As the noble Baroness said, the position has moved very substantially from where the Bill started. We have chopped out four clauses, which were all pretty large, reducing the Bill by about six pages. To be fair, we touched on the wider aspects of a universal requirement for identifiers. That is why I come back to the issue today.

I hear what the Minister says and I hear her plea not to press the amendment. I am afraid that I shall deny her that.

On Question, Whether the said amendment (No. 4) shall be agreed to?

Their Lordships divided: Contents, 167; Not-Contents, 144.

Division number 2 Private Parking: Ports and Trading Estates — Electoral Administration Bill

Aye: 165 Members of the House of Lords

No: 142 Members of the House of Lords

Aye: A-Z by last name

Tellers

No: A-Z by last name

Tellers

Resolved in the affirmative, and amendment agreed to accordingly.

Clause 30 [Replacement of counterfoils]:

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, I will also speak to Amendments Nos. 6, 65, 66 and 67. This group of amendments picks up missed consequential changes and small drafting errors created when the postal vote identifier provisions were added to the Bill on Report. Amendments Nos. 5 and 6 are missed consequential amendments. They remove a reference to the old Clause 14(3)(b) and, in the light of the deletion of that clause on Report, alter the numbering of the amendment to rule 43 of the parliamentary elections rules, inserted by Clause 30.

Amendments Nos. 65, 66 and 67 also relate to the removal of the Bill's old personal identifier provisions. As noble Lords will recall, part of the old provisions allowed for the question "What is your date of birth?" to be asked in a polling station. This question was being extended from Northern Ireland, where it is already asked. When the old provisions were removed on Report, we inadvertently also removed the ability for presiding officers in Northern Ireland to ask this question and for voters to receive a tendered ballot. These amendments undo that error, for which I apologise, and ensure that the existing Northern Ireland system remains unaltered. I beg to move.

On Question, amendment agreed to.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

moved Amendment No. 6:

Page 37, line 24, leave out "(db)" and insert "(da)"

On Question, amendment agreed to.

Clause 48 [Political party descriptions]:

Photo of Lord Goodhart Lord Goodhart Spokesperson in the Lords (Shadow Lord Chancellor), Constitutional Affairs, Advisory Team On Legal Matters, Cross-Portfolio and Non-Portfolio Responsibilities

My Lords, admittedly, this is a fairly minor amendment. It relates to the descriptions that parties can use when campaigning in elections. At the moment, there are no restrictions on the number of descriptions that a party can use. Of course, there are restrictions on the wording—one cannot use indecent wording or anything like that—but in a general election, for example, a party in any constituency can describe itself as the Oxford and West Abingdon Liberal Democrats or in a local election the Southwark Liberal Democrat Focus Group.

Clause 48 amends the Political Parties, Elections and Referendums Act 2000 to limit the number of descriptions that can be used by a party at any time to five. Of course, that makes enormous difference in regard to descriptions. We would much prefer that the situation were left as it is, but that has apparently caused concern among registration officers. For that reason the Government have introduced this point.

In earlier proceedings, I moved an amendment that would increase the number, very modestly, from five to 12. The figure of 12 was not chosen at random, but because it is the number that one obtains by adding up Scotland, Wales, Northern Ireland and the nine English regions, and so that parties can describe themselves by a regional title as well as by a national one. That way, in England, we could have "the Conservatives for East Anglia", "the Labour Party for Yorkshire and Humberside" or "Liberal Democrats for London". That seemed a modest but possibly useful increase.

I moved this amendment on Report and, since the Government said that they would go away and think about it, I withdrew it. Since then, I understand that the Government have thought about it favourably. In those circumstances, I hope that this amendment will now be acceptable to your Lordships' House. I beg to move.

Photo of Lord Greaves Lord Greaves Spokesperson in the Lords, Environment, Food & Rural Affairs

My Lords, I shall say a few brief words; it is the only time I intend to speak at Third Reading. I take this opportunity to say how grateful I was in Grand Committee for the sympathetic, sensible and constructive way the Minister dealt with the raft of amendments that I moved—which, no doubt, some people in her department thought were tedious and time-wasting, but which I thought were all important—providing answers and, in some cases, taking them on board. That is symptomatic of the way this Bill is going through. It is going to be a much better Bill than it was when it came to this House, which is a tribute to all sides and the Minister in particular.

I also apologise for not being able to be here during Report stage. I was actively engaged in other aspects of the electoral process and thought that was more important than coming here to talk about the legislation which I was campaigning under at the time. No doubt some people are quite grateful that I did not come, because proceedings did not take as long as they otherwise might.

I am entirely in favour of this amendment. It is sensible to increase the number of sensible party names which can be used. If I had been here on Report, I would perhaps have gone into more detail and moved some amendments which would not be appropriate at Third Reading, because an underlying issue has not been properly addressed. It is entirely sensible for people to be able to call themselves "the Yorkshire Liberal Democrats" or "the Yorkshire Conservatives"— although my noble friend Lord Shutt of Greetland says "Not the Yorkshire and Humberside Liberal Democrats, please". It is perfectly sensible for people to call themselves "the Scottish Liberal Democrats", "the Welsh Liberal Democrats"—or "Democratiaid Rhyddfrydol Cymru".

What is not sensible and needs to be addressed—the Electoral Commission could do this—is political parties using their party name on the ballot paper to introduce a slogan. That is wrong and ought to be stopped. There have been a number of such instances. For example, the Liberal Democrats in London fought elections as "Liberal Democrats against the privatisation of the Tube". At the last European elections, the Conservatives did not just put "Conservative and Unionist party". I forget what their slogan was, but it was something like "Conservatives for reform and modernisation of Europe". There is a political party purporting to call itself "the Liberal party" which at the last European elections had the simple party name of "No Euro". This seems an abuse of the system. Whether used in the logo or the name, slogans should not appear on ballot papers. Legitimate party names should appear on ballot papers. While supporting my noble friend's amendment, I hope that the Electoral Commission will look at this, and find a way of banning people from abusing the ballot paper by putting political slogans on it.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, I thank the noble Lord, Lord Greaves, for his kind remarks. We think that this is a proportionate and reasonable increase in number, and we are perfectly happy to accept the amendment.

Photo of Lord Goodhart Lord Goodhart Spokesperson in the Lords (Shadow Lord Chancellor), Constitutional Affairs, Advisory Team On Legal Matters, Cross-Portfolio and Non-Portfolio Responsibilities

My Lords, I am grateful to the Minister. I also thank my noble friend Lord Greaves for his sensible point of some importance about slogans. I hope it will be considered by the Electoral Commission.

On Question, amendment agreed to.

Photo of Lord Goodhart Lord Goodhart Spokesperson in the Lords (Shadow Lord Chancellor), Constitutional Affairs, Advisory Team On Legal Matters, Cross-Portfolio and Non-Portfolio Responsibilities

moved Amendments Nos. 8 and 9:

Page 55, line 17, leave out ""five"" and insert ""12""

Page 56, line 12, leave out "five" and insert "12"

On Question, amendments agreed to.

Clause 58 [Reporting donations to members of the House of Commons]:

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

moved Amendment No. 10:

Page 61, line 5, leave out "member of the House of Commons" and insert "holder of a relevant elective office unless he is not a member of a registered party and is either—

(a) a member of the Scottish Parliament, or

(b) a member of a local authority in Scotland."

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, in moving Amendment No. 10, I shall speak also to Amendments Nos. 11 to 18 inclusive. Perhaps I may start by explaining the reasoning behind this group of amendments. As noble Lords will be aware, the regulatory regime established by the Political Parties, Elections and Referendums Act 2000 followed from the recommendations made by the Committee on Standards in Public Life, the then Neill committee, in 1998. Schedule 7 to that Act sets out, among many other things, the requirement that holders of elective office should report the donations they have received to the Electoral Commission, which will then publish them. That has the effect that MPs, MEPs, Members of devolved Administrations and local councillors throughout the United Kingdom have to report donations to both the Electoral Commission and the relevant Register of Members' Interests of the body of which they are a Member.

Transparency and accountability on the funding of holders of relevant offices are of crucial importance. Reporting donations that holders of elected office receive and publishing them are valuable and important activities, and we should do nothing to diminish that. However, many holders of these electoral offices take the view that such duplication is unnecessary. It can lead to confusion, and unintentional errors can sometimes be made in the reporting of donations.

This group of amendments follows from amendments tabled in another place that applied only to MPs which received widespread support from all parts of another place. Those amendments became Clause 58 and removed the need for duplication in reporting from MPs only. When that clause was tabled, the Government gave a commitment to resolve to work with the devolved authorities on a solution to remove the requirement for all holders of elective office to report donations to the Electoral Commission. We have been successful, and I am pleased to present this group of amendments, as I promised we would.

These amendments remove the requirement of dual reporting for MPs, MEPs, Welsh Assembly Members, Welsh and English local councillors, Members of the Scottish Parliament and Scottish local councillors who are members of a political party. They mean that holders of any relevant elected office would not have to report any donations received to the Electoral Commission, whether the donations were received in their role as a relevant elected officer or in their role as a member of a registered political party. However, the Electoral Commission will still be obliged to record any such details it receives from the relevant Registers of Members' Interests. The commission will also continue to monitor compliance with the regulatory system set out in the Political Parties, Elections and Referendums Act 2000. However, it would have no role to play regarding the non-reporting of donations. The Register of Members' Interests of the body that Members belong to will retain its functions on that issue.

The provision will commence only once the Electoral Commission is content that the relevant authorities have in place sufficient arrangements to ensure that it is still able to maintain an accurate register. This amendment seems to us to strike the right balance between, on the one hand, requiring transparency in the donations made to holders of elective office and, on the other hand, removing the bureaucratic duplication of reporting requirements.

I should add that the amendments I present today are supported by the Electoral Commission as well as by other relevant bodies including the Scottish Executive and the Standards Board for England. I beg to move.

On Question, amendment agreed to.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

moved Amendments Nos. 11 to 18:

Page 61, line 8, leave out "member of the House of Commons" and insert "holder of the relevant elective office"

Page 61, line 13, leave out "member of the House of Commons" and insert "holder of a relevant elective office"

Page 61, line 14, leave out "House of Commons" and insert "relevant body"

Page 61, line 15, leave out "member" and insert "holder of the office"

Page 61, line 21, at end insert—

"(3) In sub-paragraph (1)(a) a relevant body is—

(a) if the holder of a relevant elective office is a member of a body mentioned in paragraphs (a) to (f) of paragraph 1(8), that body;

(b) if the holder of a relevant elective office is the Mayor of London, the London Assembly;

(c) if the holder of a relevant elective office is an elected mayor within the meaning of Part 2 of the Local Government Act 2000, the local authority of which he is the mayor.""

Page 61, line 23, leave out "members of the House of Commons" and insert "the holders of a relevant elective office"

Page 61, line 26, leave out "members" and insert "holders of relevant elective office"

Page 61, line 26, at end insert—

"(5) In subsection (4) references to the holder of a relevant elective office must be construed in accordance with Schedule 7 to the 2000 Act."

On Question, amendments agreed to.

Clause 60 [Regulation of loans etc]:

Photo of Lord Goodhart Lord Goodhart Spokesperson in the Lords (Shadow Lord Chancellor), Constitutional Affairs, Advisory Team On Legal Matters, Cross-Portfolio and Non-Portfolio Responsibilities

moved Amendment No. 19:

Page 62, line 23, at end insert—

"(5A) An agreement or arrangement entered into before the commencement of section 60 of the Electoral Administration Act 2006 which would be a regulated transaction if entered into after that date is also a regulated transaction unless it has come to an end before that date."

Photo of Lord Goodhart Lord Goodhart Spokesperson in the Lords (Shadow Lord Chancellor), Constitutional Affairs, Advisory Team On Legal Matters, Cross-Portfolio and Non-Portfolio Responsibilities

In speaking to Amendment No. 19 I wish to speak also to Amendments Nos. 21 to 26 and Amendment No. 30. These amendments raise an issue which has already been well debated, and I will therefore try to be as brief as possible.

The Government have rightly made loans to political parties subject to disclosure, whether or not they have been made at commercial rates. In doing so, the Bill will override the confidentiality requirements that may be contained in some or all of those loan agreements. Some of the loans have been made by people who would not have been allowed to make a donation to the party. That, of course, was legal under the 2000 Act, provided they were made on commercial terms, but it was plainly a breach of the spirit of the Act. In those circumstances we believe that the loan should not only be disclosed but that it should also be repaid.

My original proposal was that the loan should be repaid as soon as the Bill not only became enacted but came into force. I was persuaded by the debate we had on that occasion that this was too drastic and that time should be given for repayment to avoid any immediate financial crisis for the parties concerned. On Report, therefore, I altered the amendments to allow 12 months from the date of the commencement of the Bill for repayment. That may be overriding the terms of the agreement, but no more so, I think, than by requiring disclosure which overrides a confidentiality clause.

Further, where the loan agreement provides for repayment on demand or on fairly short notice—as I believe almost all of them will do—the lender who chooses not to recall the loan is in effect conferring a new benefit on the borrower. I believe it is wrong to allow loans in this category to remain outstanding indefinitely and that the provision in these amendments is necessary to bring to an end a practice that is an abuse of the spirit of the law and that these amendments also give fair time for repayment by political parties which have taken advantage of this loophole. I beg to move.

Photo of Lord Kingsland Lord Kingsland Shadow Lord Chancellor, Constitutional Affairs, Shadow Lord Chancellor, Parliament

My Lords, the noble Lord, Lord Goodhart, and I often find ourselves in harmony on many of his amendments. However, on this occasion, I find myself a dissenting voice. The amendment, as I understand it, would result in existing loans, deemed illegal after the Act, having to be repaid immediately.

Photo of Lord Goodhart Lord Goodhart Spokesperson in the Lords (Shadow Lord Chancellor), Constitutional Affairs, Advisory Team On Legal Matters, Cross-Portfolio and Non-Portfolio Responsibilities

My Lords, I am sorry to interrupt, and I am grateful to the noble Lord for giving way. However, the loans would not be repayable immediately. They would be repayable over a period of 12 months.

Photo of Lord Kingsland Lord Kingsland Shadow Lord Chancellor, Constitutional Affairs, Shadow Lord Chancellor, Parliament

My Lords, I am most grateful for that correction. The obligation to repay them would be immediate but the actual repayment would, indeed, be over a period of time. I am most grateful to the noble Lord and, of course, I stand corrected.

I find myself in agreement with the remarks of the noble and learned Lord the Lord Chancellor when, in Committee, he said:

"We think that the balance is best struck by requiring disclosure but not requiring what may wreak havoc with a party's finances or cause significant prejudices to the individual lender".—[Hansard, 8/5/06; col. 758.]

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, the noble Lord, Lord Kingsland, and I find ourselves in agreement on the amendment, which I hope will bring some satisfaction to the noble Baroness, Lady Hanham. The noble Lord, Lord Goodhart, rightly said that the transactions described and the loans made were made in good faith and completely legally. We believe that the transparency now required is right, but we continue to take the view expressed by the noble Lord, Lord Kingsland, and by my noble and learned friend the Lord Chancellor in Committee. The proposal would wreak havoc with party finances. I know that the noble Lord, Lord Goodhart, has gone some way to ameliorate those difficulties by giving a longer timescale, but none of us knows whether any political party would be affected by that or in what way. There comes a point in retrospection where we must decide that we will go this far and no further.

Noble Lords will be aware that political parties will look carefully at the loans that they receive. They will have the opportunity between the end of our scrutiny of the Bill and Royal Assent to think carefully about the provisions and their lenders will have the opportunity to say that they would rather have the loans repaid. That is for them. We then move to a period of greater transparency when the law takes effect. We continue to think that we have the balance right. On that basis, I hope that the noble Lord will feel able to withdraw the amendment.

Photo of Lord Goodhart Lord Goodhart Spokesperson in the Lords (Shadow Lord Chancellor), Constitutional Affairs, Advisory Team On Legal Matters, Cross-Portfolio and Non-Portfolio Responsibilities

My Lords, I remain unconvinced by the argument against my amendments but, in view of the remarks made from both the Government and the Conservative Benches, it is clear that we would not succeed if we were to force a Division. I am well aware that we are running somewhat behind time on this matter and therefore, with some regret, I ask the leave of the House to withdraw the amendment.

Amendment, by leave, withdrawn.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

moved Amendment No. 20:

Page 63, line 18, at end insert—

"(4) For the purposes of subsections (1) and (2), no account is to be taken of the effect of any provision contained in a loan agreement or an agreement for a credit facility at the time it is entered into which enables outstanding interest to be added to any sum for the time being owed in respect of the loan or credit facility, whether or not any such interest has been so added."

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, at Report I made a commitment to return to the House with provisions to resolve one particular issue concerning loans that contain capitalisation provisions. In moving Amendment No. 20, I should like to speak also to Amendment No. 60. My noble and learned friend and I have previously clarified to the House—in response to a probing amendment by the noble Lord, Lord Kingsland—the status of loans that contain capitalisation provisions. We are clear that where a regulated transaction provides for capitalisation at the outset, the provisions of the Bill are such that activation of the capitalisation provision is not to be treated as a new regulated transaction.

The difficulty that we found, about which I agreed to return to your Lordships' House, concerns the complexities that arise in determining the value of a loan that provides for capitalisation. For the purposes of reporting, there would be a difficulty where the value of a regulated transaction was just below the reporting threshold—let us say, £4,000—which might cross the reporting threshold if capitalisation provisions took effect. In those cases, the variable element would be crucial in deciding whether the transaction needed to be reported under the new regime and it would be impossible to make that decision with any certainty.

Government Amendment No. 20 removes the need to consider capitalisation provisions which form part of an agreement at the outset when determining the value of a regulated transaction. For the reasons that I have just stated, to require political parties to consider capitalisation provisions in the valuation of regulated transactions would be unduly complex and would impose on political parties what could be described as a rather inexact science. As amended, all parties will have clarity in terms of the circumstances where the reporting threshold would be crossed.

Where a transaction is recordable, Amendment No. 60 will make it a specific requirement to state in the transaction report whether the agreement contains a capitalisation provision. Where a recordable transaction that did not provide for capitalisation is later varied to provide for capitalisation, the change must be reported under the continuing reporting requirement in new Section 71N. The key drivers in all this are increasing openness and transparency, and the amendments provide for specific reporting of regulating transactions that contain capitalisation provisions. Once a regulated transaction has of its own right and not in respect of capitalisation provisions exceeded the reporting thresholds, these amendments require the reporting of the fact that the regulated transaction contains capitalisation provisions.

We think these amendments strike the right balance between openness and practicability. They provide for the disclosure of regulated transactions that contain capitalisation provisions, but avoid the need for political parties to try to predict whether capitalisation provisions might or might not cause a regulated transaction to exceed the reporting threshold. I should add that we simply do not want to put anyone in the position where they could accidentally be criminalised when they could not possibly know in advance the value of the interest that might be capitalised. On that basis, I hope that noble Lords will accept the amendment, and I beg to move.

Photo of Lord Goodhart Lord Goodhart Spokesperson in the Lords (Shadow Lord Chancellor), Constitutional Affairs, Advisory Team On Legal Matters, Cross-Portfolio and Non-Portfolio Responsibilities

My Lords, I seek clarification on this. I quite understand that it is impossible to predict the value of a capitalisation requirement, but will loans with a capitalisation clause have to be disclosed once the combined value of the original loan plus the capitalisation add up to more than £5,000? That would seem to be the logical conclusion but I am not sure from the wording that that would be the result. That causes me some concern because, if that is the case, there would be a serious loophole here.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, the answer to the question is no, it would not. The basis of our amendment—I shall put this into my own words as I had to learn all this; capitalisation is a reasonably new concept to me—is that a loan of, say, £4,000 might have a capitalisation provision that never comes into effect. Alternatively, the provision might come into effect at some point in the lifetime of a loan that could be quite lengthy—it could be 10 years, for all we know—only when someone perhaps fails to pay the interest on time, or whatever. We think that it is unrealistic to require a local treasurer or anyone else to be completely clear about the moment at which it might stray into £5,001, if it ever did. Where it is very clear that a loan of £5,000 to a national party must be reported anyway and that it has a capitalisation provision, you should report the fact that you have that provision. If you add the provision in later, you should report the fact that you have added it in, because you are required to continue your reporting. I can see why the noble Lord thinks it would be attractive to try to work out something of that nature, but we really do not think that it is practical and we have to draw the line somewhere in what we ask people to do.

Photo of Lord Goodhart Lord Goodhart Spokesperson in the Lords (Shadow Lord Chancellor), Constitutional Affairs, Advisory Team On Legal Matters, Cross-Portfolio and Non-Portfolio Responsibilities

My Lords, I have to say that that causes me some concern, because if someone makes a loan of £4,900 on terms that enable the donee political party simply to delay paying interest so that the interest piles up year by year, that could add up to a very substantial sum over a few years. That does seem to be a potential loophole.

Photo of Lord Kingsland Lord Kingsland Shadow Lord Chancellor, Constitutional Affairs, Shadow Lord Chancellor, Parliament

My Lords, I entirely understand the concern of the noble Lord, Lord Goodhart. On the other hand, I say respectfully to the Minister that the Government have got this matter absolutely right, particularly when one considers that the obligation on a treasurer is such that he will be criminally liable if he is negligent. This government amendment was prompted by a series of amendments we tabled in Committee to achieve greater clarity in an area that was more than somewhat befogged. The Minister's amendment and the statement with it have gone a long way to appease our concerns and we are happy to support it.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, I am grateful to the noble Lord, Lord Kingsland, for his support. All I can say to the noble Lord, Lord Goodhart, is that in the end we want a regime that people can operate, although I take absolutely his point about treasurers. We thought about this very carefully but decided that it had to be a practical proposition for those who have a lot to do. We think we have it about right.

On Question amendment agreed to.

[Amendments Nos. 21 to 26 not moved.]

Photo of Lord Kingsland Lord Kingsland Shadow Lord Chancellor, Constitutional Affairs, Shadow Lord Chancellor, Parliament 6:00, 7 June 2006

moved Amendment No. 27:

Page 65, line 39, leave out "ought reasonably to have known" and insert "was reckless as to whether or not he knew"

Photo of Lord Kingsland Lord Kingsland Shadow Lord Chancellor, Constitutional Affairs, Shadow Lord Chancellor, Parliament

My Lords, having raised the question of negligent treasurers during my intervention to express my support for the Government on the previous amendment, I now seek to expunge the word "negligence" from the obligations of treasurers. In doing so, I hope that I shall not be accused of hypocrisy by the noble Baroness.

Amendments Nos. 27 and 28 relate to Section 71L entitled:

"Offences relating to regulated transactions".

I wish to draw your Lordships' attention to Clause 71L(1)(b) which reads:

"A registered party commits an offence if . . . an officer of the party knew or ought reasonably to have known of the matters mentioned in paragraph (a)".

Our amendment would replace the words,

"or ought reasonably to have known of the matters mentioned", with the words,

"was reckless as to whether or not he knew".

The reasons for pressing the amendment are twofold. First, as a general proposition the criminal law is extremely reluctant to incorporate, in any statute, negligence as part of the mens rea of a crime. Indeed, in a letter written to me by the noble Baroness, which I have just seen, she says herself at the beginning of the fourth paragraph:

"We do, of course, act with great hesitancy in using negligence as a basis for criminal offence".

The noble Baroness goes on to say:

"However, the criminal offences set out in new section 71L operate within a regulatory framework and we consider this to be an appropriate standard in such an environment".

I would be most grateful if the noble Baroness would explain in her response exactly what that means. In my submission, it is neither here nor there if negligence is used as part of the mens rea in a regulatory context. In whatever context negligence is used in a criminal offence, in principle, it is something that is contrary to the great constitutional principles of this country, which have informed the drafting of our criminal law throughout the ages.

I have a second reason for proposing the amendment. People who run the finances of local constituency parties, the honorary treasurers, often do so out of a sense of public duty, are frequently not experts in financial matters, and are usually retired and spend most of their time doing things other than looking after constituency finances. Quite often there might be considerations about whether a particular financial transaction falls within or outside the regulatory framework. How on earth can a treasurer in that position know for certain what is the situation? In my view, this provision will be a serious deterrent to individuals coming forward to be honorary treasurers of their local constituency parties. I believe the Government have the balance wrong here. Voluntary work of this sort is to be encouraged; and they will be doing completely the opposite with the drafting approach they have taken in new Section 71L.

A further matter puzzles me. Turning to the part of the Bill dealing with loans, we reach Section 71T, which is headed:

"Declaration by a treasurer in transaction report".

Section 71T(5) states:

"A person commits an offence if he knowingly or recklessly makes a false declaration under this section".

There is a clear conflict between the approach taken by the Bill for declarations by treasurers in transaction reports under new Section 71T and for what is to be recorded in quarterly reports under new Section 71M. What on earth is the logic of this? There may be a simple answer, but it is not one that occurs to me.

For those reasons, I shall seek to press the amendment. I beg to move.

Photo of Lord Goodhart Lord Goodhart Spokesperson in the Lords (Shadow Lord Chancellor), Constitutional Affairs, Advisory Team On Legal Matters, Cross-Portfolio and Non-Portfolio Responsibilities

My Lords, Members on these Benches support the amendment moved by the noble Lord, Lord Kingsland, on the same grounds as he has outlined: first, the undesirability of making negligence a criminal offence; and secondly, what in practice will be more important, the fact that this imposes an excessive burden on constituency treasurers. As the noble Lord pointed out, they are always volunteers and usually people who have a number of things to do. We have to be careful to avoid making scapegoats of them and thus making it more difficult, if not impossible, for political parties to find people willing to take on these jobs. The amendment is very sensible. I recognise that it may lead to a discrepancy between the treatment of negligence relating to loans and negligence relating to donations, but surely two wrongs do not make a right. It is then simply a matter of applying the same principle to donations.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, I am sorry to find myself in a different place from that of both noble Lords, although I should say to the noble Lord, Lord Goodhart, that I have discussed this issue with his colleague in another place, who gave me a slightly different view.

I accept completely what the noble Lords, Lord Kingsland and Lord Goodhart, have said about the need to ensure that the valuable work done by party treasurers, along with so many others in our community, is made possible. I accept too that those who act as honorary treasurers of one organisation may take on the same role in others. I certainly found myself in that position so that eventually I became the honorary treasurer of lots of different groups. I pay tribute to all those who help our democratic process by taking on these responsibilities at the local level.

I understand the reasoning behind the noble Lord's amendment in that he is seeking to ensure what he considers to be a greater degree of protection to treasurers and that they do not, through innocent oversight, fail to recognise their responsibilities. However, we have considered this issue carefully and we believe very firmly that the regime set out in new Section 71L provides sufficient safeguards. A registered treasurer will not commit an offence unless he knew or ought reasonably to have known as a fact that the party had entered into a transaction with an unauthorised participant. Where a registered treasurer can show that he took all reasonable steps to ascertain such matters, he will not be in a position where he ought reasonably to have known of the transaction. All that is required is to do what is reasonable in the circumstances. When it comes to taking out loans, I think it is right to ask that people should act in a reasonable manner.

The noble Lord made the point that we avoid using negligence as a basis for a criminal offence, but where criminal offences are created to support the operation of regulatory offences that is not necessarily the case. Indeed, the approach we are taking mirrors the existing basis for criminal offences set out in the Political Parties, Elections and Referendums Act in respect of donations. Let me take one example. In the donations regime, where a treasurer submits a report that does not comply with the reporting requirements—for example, if he fails to report a transaction that is over the reporting threshold—an offence is committed. The treasurer has a defence if he can prove that he took all reasonable steps and exercised all due diligence. That clearly amounts to a negligence-based criminal offence and I am not persuaded that in the loans regime we should depart from the situation that we have in the donations regime.

In fact, I would argue that if treasurers have two systems that are close to each other, the better off they will be in understanding their responsibilities. In addressing this question in the way that we have done, we have stuck to the spirit and letter of what we said we would do—which is to make the two regimes as compatible as possible. On that basis, I will not accept the amendment. Raising awareness of the need to take reasonable steps is a responsible and straightforward act for political parties to undertake. In doing so, political parties will encourage minimum standards of care in those responsible for their financial affairs. Again, this mirrors precisely what happens within the Political Parties, Elections and Referendums Act.

There has been a heartening consensus in all that we have tried to do for greater openness, transparency and regulation, but we need to accept that there is an increased necessity for accurate and scrupulous reporting by all those involved and that we need to put in place a regime that is as straightforward to follow as possible. We believe that by mirroring what we already have in the donations regime we will fulfil that obligation. While we accept that we are placing an obligation on treasurers in terms of the necessity for compliance with the loans regime, we believe that by working with the political parties we can ensure that they will get the information so that they can comply.

On the basis that we think the best approach is to mirror what we already have, I hope the noble Lord will withdraw his amendment.

Photo of Lord Kingsland Lord Kingsland Shadow Lord Chancellor, Constitutional Affairs, Shadow Lord Chancellor, Parliament

My Lords, I am grateful to the noble Baroness for responding in that way; even though what she said was wholly unacceptable to this side of the House.

She did not address the question of the difference in standard between proposed new Sections 71L(1)(b) and 71T(5). Why is there a different standard for the treasurers? In new Section 71L we have the "negligence" standard; but in new Section 71T the only way in which a treasurer can be prosecuted is for "knowingly or recklessly" making a false declaration. Why is there a difference? It seems to me, on the face of it, to be wholly illogical.

I await the signal from the Box.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, the reason I did not answer the question that the noble Lord, Lord Kingsland, quite rightly put to me is that I did not understand the answer I received. If I am completely honest, I do not understand this one either.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, I have to be honest—particularly when I am dealing with aspects of law because I know perfectly well that the noble Lord, Lord Kingsland, is a very eminent lawyer. I would not accuse him of hypocrisy either, which is what he said.

I am told that the Bill follows the distinctions in the PPERA for donations. In other words, it continues to mirror, I think, what happens in that Act. So although the noble Lord quite rightly says there is a recklessness standard there, it mirrors exactly what happens in PPERA. I understand that to mean that when you look at the loans regime and the donations regime together, you will see that the criminal offences mirror each other. That is a very significant issue because it is the basis upon which I believe—having thought very hard about this—treasurers will find it easier to adapt to this regime because it will mirror what they have had before.

Photo of Lord Kingsland Lord Kingsland Shadow Lord Chancellor, Constitutional Affairs, Shadow Lord Chancellor, Parliament

My Lords, I think the House is entitled to conclude that if the noble Baroness cannot give your Lordships a reason for the distinction, then the distinction is a mindless distinction. In those circumstances, I find that the Minister's response adds fuel to my determination to seek the opinion of your Lordships' House. I beg to move.

On Question, Whether the said amendment (No. 27) shall be agreed to?

Their Lordships divided: Contents, 115; Not-Contents, 126.

Division number 3 Private Parking: Ports and Trading Estates — Electoral Administration Bill

Aye: 113 Members of the House of Lords

No: 124 Members of the House of Lords

Aye: A-Z by last name

Tellers

No: A-Z by last name

Tellers

Resolved in the negative, and amendment disagreed to accordingly.

[Amendment No. 28 not moved.]

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs) 6:26, 7 June 2006

moved Amendment No. 29:

Page 67, line 24, at end insert—

"(14) This section does not apply to a transaction which is entered into before the commencement of section 60 of the Electoral Administration Act 2006."

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, this group of amendments makes minor, technical amendments to new Part 4A of the Political Parties, Elections and Referendums Act 2000 introduced by Clause 60, relating to the reporting of regulated transactions where that transaction is with an unauthorised participant.

Amendment No. 29 inserts subsection (14) into Section 71L of new Part 4A. Section 71L deals with offences relating to regulated transactions entered into with an unauthorised participant. This amendment puts beyond doubt that transactions entered into before the commencement of the Bill will not be subject to the conditions of Section 71L.

Amendment No. 53 confirms that a transaction report must also record any regulated transaction which is entered into by the party and a person who is not an authorised participant and is dealt with during the reporting period in accordance with the requirements of Section 71I or Section 71J. The amendment simply spells out more clearly when the transaction report must be submitted.

Amendments Nos. 57 and 58 add further detail to the information that must be provided in a quarterly or weekly report about an unauthorised participant. As well as the name and address of the unauthorised participant, the date when, and the manner in which, the transaction was dealt with must be given. The reference to the transaction being dealt with is a reference to the fact that such transactions are void, and any moneys received under them must be repaid to the person from whom they were received. I beg to move.

On Question, amendment agreed to.

[Amendment No. 30 not moved.]

[Amendment No. 30A, which had been incorrectly numbered as Amendment No. 49, not moved.]

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

moved Amendment No. 31:

Page 68, line 3, at end insert—

""relevant benefit", in relation to any person and any year, means—

(a) a relevant donation within the meaning of section 62(3) accepted by the party from that person as a donor, or

(b) a relevant transaction entered into by the party and that person as a participant, and a relevant benefit accrues when it is accepted (if it is a donation) or entered into (if it is a transaction)."

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, I would have liked to move the amendment formally, but as it is in rather a large group, I should speak to it. In moving the amendment, I shall speak also to Amendments Nos. 32 to 48, 50, 51, 52, 54, 59, 72 and 75.

The amendments return us to an issue to which we gave consideration both on Recommitment and on Report—the gap that existed in respect of disclosure of aggregated loans and donations. The Government are tabling the amendments because there was previously no provision in the Bill to aggregate loans and donations, such that it would have been possible to make a donation of £5,000 and a loan of £5,000 without a requirement for either to be disclosed.

As I said on Report, it would be quite wrong for there to be such a gap. I am most grateful to the noble Lord, Lord Goodhart, for his original amendment, which usefully highlighted this issue. I undertook to return to your Lordships' House with detailed amendments to tackle this important issue.

These amendments close that gap. Under them, a requirement to report and to disclose is triggered where donations, regulated transactions, or any combination of donations and regulated transactions from the same permissible donor or authorised participant exceed the reporting threshold.

The amendments adopt the term "relevant benefits" as a composite phrase to refer to something that is either a donation or a regulated transaction. The approach that we have taken is that it should not matter whether or not a donation, or a regulated transaction, or a combination of donations and regulated transactions are made. If the aggregate value of any combination of relevant benefits exceeds the initial reporting threshold of £5,000, or the subsequent reporting threshold of £1,000, a requirement to report is triggered.

The reporting requirements have been kept as simple as possible. We have steered away from creating a complicated new structure and register for the separate reporting of hybrid aggregates. Rather, we have adopted the more straightforward way whereby donations feed into the existing reporting structure for donations and regulated transactions feed into the existing reporting structure for regulated transactions. So, a party must submit a donation report every quarter, which must list all recordable donations. Under the approach adopted by these amendments, it will not matter whether a donation is required to be reported because, first, it exceeds the reporting threshold in its own right, or, secondly, it is required to be reported because, taken with regulated transactions, it exceeds the reporting threshold. In either case, the donation must be entered in the donation report. In the second case, the regulated transaction must also be reported in the transaction report for that quarter.

To ensure clarity, where a requirement to report is triggered because of an aggregation of donations and loans, this fact must be reported in the respective donation and transaction reports. I beg to move.

Photo of Lord Goodhart Lord Goodhart Spokesperson in the Lords (Shadow Lord Chancellor), Constitutional Affairs, Advisory Team On Legal Matters, Cross-Portfolio and Non-Portfolio Responsibilities 6:30, 7 June 2006

My Lords, I am glad that the Government have taken on board this point, which I raised originally. I had a slight bad conscience over it because it has added two or three more pages to what is rapidly becoming a bulky Act of Parliament.

On Question, amendment agreed to.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

moved Amendments Nos. 32 to 48:

Page 68, line 4, leave out "transaction or transactions" and insert "benefit or benefits"

Page 68, line 5, after "subsection" insert "or section 62(4)"

Page 68, line 8, leave out "transaction or transaction" and insert "benefit or benefits"

Page 68, line 14, leave out "as part of" and insert "together with any other relevant transaction or transactions included in"

Page 68, line 17, leave out "transaction" and insert "benefit"

Page 68, line 18, leave out "is entered into" and insert "accrues"

Page 68, line 19, leave out "transaction or transactions" and insert "benefit or benefits"

Page 68, line 20, after "subsection (4)" insert "or section 62(4)"

Page 68, line 21, leave out from "when" to end of line 23 and insert "a relevant transaction falling within subsection (6A) has been entered into"

Page 68, line 24, leave out "transaction or transactions" and insert "benefit or benefits"

Page 68, line 25, leave out "subsection (4)" and insert "that provision"

Page 68, line 26, leave out "transaction or transactions" and insert "benefit or benefits"

Page 68, line 27, at end insert "or section 62(6)"

Page 68, line 28, leave out "transaction or transactions" and insert "benefit or benefits"

Page 68, line 29, at end insert—

"(6A) A relevant transaction falls within this subsection—

(a) if the value of the transaction is more than £1,000, or

(b) if, when it is added to any other relevant benefit or benefits accruing since the time mentioned in subsection (6)(a) or (b), the aggregate amount of the benefits is more than £1,000."

Page 68, line 31, leave out "transaction" and insert "benefit"

Page 68, line 34, leave out "as part of" and insert "together with any other relevant transaction or transactions included in" .

On Question, amendments agreed to.

[Amendment No. 49 had been incorrectly numbered.]

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

moved Amendments Nos. 50 to 54:

Page 68, line 35, leave out "that subsection" and insert "subsection (6A)"

Page 68, line 36, leave out "transaction" and insert "benefit which"

Page 68, line 37, leave out "is entered into" and insert "accrues"

Page 68, line 40, after "with" insert "during the reporting period"

Page 70, line 16, at end insert—

"( ) references in section 71M to a relevant benefit did not include references to a relevant donation."

On Question, amendments agreed to.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, in moving Amendment No. 55, I wish to speak also to Amendments Nos. 63 and 64. These amendments fulfil a commitment made by my noble and learned friend the Lord Chancellor on Recommitment of the Bill on 8 May when he introduced the main tranche of amendments regulating loans to political parties. He said then:

"It will also be necessary to consider the most appropriate means by which to extend the provisions to Northern Ireland. Amendments will be brought forward for that purpose".—[Hansard, 8/5/06; col. 753.]

These are those amendments.

The regime for loans and other regulated transactions is modelled closely on that for donations which already exists in the Political Parties, Elections and Referendums Act 2000, departing from it only where necessary to take account of the different nature of donations and loans. In considering how to apply the new provisions to Northern Ireland we naturally looked at how donations are dealt with there, both currently and in future plans.

As noble Lords will be aware, the donations regime has been disapplied in Northern Ireland since 2000 by orders made under the 2000 Act. However, the Northern Ireland (Miscellaneous Provisions) Bill currently before this House contains provisions which mean that the disapplication of the regime will expire on 31 October 2007. After this point, the permissibility and reporting requirements of the donations regime will apply in Northern Ireland.

However, modifications will be made to that regime. In relation to the reporting requirements, for a transitional period due to end on 31 October 2010—but subject to extension by order—details of donations reported to the Electoral Commission will be held confidentially. A permanent change will also be made to the permissibility requirements. Irish citizens and bodies who can donate to Irish parties will be permitted to donate to political parties in Northern Ireland.

The amendments before us today extend the loans regime to Northern Ireland, but confer an order-making power on the Secretary of State. The order-making power will allow the loans regime to be modified as it applies in Northern Ireland, in a way that allows it to mirror the approach to be adopted in relation to donations as provided for in the Northern Ireland (Miscellaneous Provisions) Bill.

As noble Lords will recognise from the loans provisions already in the Electoral Administration Bill, the detail is great and complex. In the case of Northern Ireland further detailed and technical consideration is necessary before the provisions can be finalised. The scope of the order-making power is restricted in that it only allows the Secretary of State to make provisions which correspond to, or are similar to, those in the Northern Ireland (Miscellaneous Provisions) Bill, and it will, of course, be subject to the affirmative resolution procedure. Further details have been provided in a memorandum to the Delegated Powers and Regulatory Reform Committee.

These are appropriate and necessary amendments to further complete the set of provisions to regulate the giving of loans to political parties. I beg to move.

On Question, amendment agreed to.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, this is a small amendment to bring the order-making power which concerns the weekly reporting requirements for loans in line with that for donations. I am most grateful to the Delegated Powers and Regulatory Reform Committee for pointing out an omission with regard to this power.

New Section 71U enables the Secretary of State, after consulting the Electoral Commission and registered parties, to extend the weekly—as opposed to the normal quarterly—reporting requirements to specified election periods for certain types of election other than a general election. This replicates the existing power in Section 67, which applies to donations.

Section 67 requires an order made under it to be subject to the affirmative resolution procedure, and this amendment will ensure that an order extending the weekly reporting requirement for the reporting of loans will also be subject to the affirmative procedure. I beg to move.

On Question, amendment agreed to.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

moved Amendments Nos. 57 to 60:

Page 77, line 35, after "give" insert "—

(a) "

Page 77, line 35, at end insert—

"(b) the date when, and the manner in which, the transaction was dealt with in accordance with subsections (3) to (5) of section 71I or those subsections as applied by section 71I(6) or 71J(2)."

Page 78, line 4, at end insert—

"( ) If the requirement to record the transaction arises only because the value of the transaction has, for the purposes of section 71M(4) or (6), been aggregated with the value of any relevant donation or donations (within the meaning of section 62), a quarterly report must contain a statement to that effect."

Page 78, line 24, at end insert—

"( ) The report must state whether the agreement contains a provision which enables outstanding interest to be added to any sum for the time being owed in respect of the loan or credit facility."

On Question, amendments agreed to.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

moved Amendment No. 61:

Page 80, line 42, at end insert—

"( ) Part 5A of Schedule 1 amends the 2000 Act for the purpose of controlling loans and certain other transactions involving individuals and members associations."

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, in moving Amendment No. 61, I wish to speak also to Amendments Nos. 68, 76, 77, 78, 80 and 81.

My noble and learned friend the Lord Chancellor said on re-commitment of the Bill on 8 May, that while the amendments which now form Clause 60 were comprehensive in all respects as they relate to political parties, it would be necessary to bring forward further amendments,

"to close any gaps by extending the provisions in much the same manner to individual members of political parties, holders of elective office and members associations".—[Hansard, 8/5/06; col. 753.]

These important amendments therefore further extend the principles of the loans regime—which this House has already endorsed—to apply to individual members of political parties, holders of relevant elective office and members associations.

The approach taken in the amendments in respect of loans to individuals and members associations mirrors the approach taken for individuals and members associations in the existing donations regime of the Political Parties, Elections and Referendums Act 2000. As is the case for donations, we have drawn a capacity-based distinction in respect of the transactions entered into by individuals and members associations.

The activities of political parties are inherently political, but the activities of individuals are not. Under the donations regime, any donation afforded to a political party can be subjected to a regulatory regime concerned with,

"donations and expenditure for political purposes".

PPERA recognises that this is not, of course, appropriate in the case of individuals. Accordingly, a donation must be a "controlled donation" before it falls within the ambit of Schedule 7, dependent on the donation being received by the individual or members association in circumstances where it has been offered or retained for use in connection with any relevant political activities.

The amendments take a similar approach. Regulated transactions entered into by individual members of political parties and members associations will only be captured by this regime if the individual or members association intends at the time they enter into the transaction to use any money or benefit obtained in connection with relevant political activities.

We also in these amendments remove from individuals and members associations the requirement to report loans on less than commercial terms under the donations regime. As noble Lords will be aware, the loans regime for political parties removes such loans from the definition of "donation", because they will now fall within the definition of a "regulated transaction". This change avoids a duplicate reporting requirement. A similar approach is taken for loans to individuals and members associations. We also extend the principles of aggregation of loans and donations to individuals and members associations. We have taken exactly the same approach as that taken for political parties, whereby donations and regulated transactions from the same regulated participant that are below the reporting threshold fall to be disclosed when, in aggregation, such relevant benefits exceed the reporting threshold. I beg to move.

Photo of Lord Campbell-Savours Lord Campbell-Savours Labour

My Lords, I shall briefly intervene here. I wanted to find a peg this evening on which to hang an issue that arises under Amendment No. 68. The House will recognise that we are at the beginning of a discussion on the loans regime, which has not been before the House of Commons. When it considers the Bill that we will send to it, it will be considering for the first time the whole question of loans. I was in correspondence with the chairman of the Electoral Commission, Sam Younger, until 12 May when I received a letter from him, part of which I want to draw to the attention of the House.

I had been asking questions about the case of Fifth Avenue Partners Limited, not for any particular political reason but because I wanted to try to understand the extent to which it had implications for the loans regime, although it related to a donation. I will not quote the section of Sam Younger's letter which deals with Fifth Avenue Partners Limited, but I will quote the section that is relevant to this Bill:

"The measures being proposed in the Electoral Administration Bill concerning loans are based on the rules for donations. Hence, in order for a loan from a company to be permissible it has to pass the same three tests as for a donation".

We all know that the three tests a company must pass—as must a loan—are that the company is registered in the United Kingdom, that the company is incorporated in the United Kingdom or another member state, and that the company carries on business in the United Kingdom.

"As a result, the position that exists currently in relation to Fifth Avenue Partners"— which is a donation discussion—

"could recur in the case of a loan—or indeed an otherwise 'straightforward' donation—to a party from a company.

In the light of the issue surrounding Fifth Avenue Partners, we are preparing guidance for political parties on the questions we think should be asked in relation to the 'carrying on business' test. Of course in the vast majority of cases a copy of the latest audited set of accounts filed at Companies House would be enough. However, we are considering what guidelines could be set down to cover, for example, newly established companies. On a practical level, we are inclined to suggest that, before accepting a donation, a party ought to see the company's latest set of audited accounts and/or a signed statement by (for example) the company secretary confirming that the companying is carrying on business.

Under the current legislation, it is for the party receiving a donation to satisfy itself that the donation is permissible. The provision of detailed guidance on what constitutes carrying on business should help parties,"— that is, guidance that the Electoral Commission will be issuing—

"although any definitive statement of what constitutes carrying on business could only be given by a court of law. One way of giving parties more certainty about whether they are right to accept donations (or loans) would be to change the rules to specify that the Commission must receive and approve specified documentary evidence in relation to the donation (or loan) before it is accepted. This, however, would require a change in the law".

In many ways, that is a different approach from that which is being adopted by the Government. I recognise that we could not have a system where the Electoral Commission was required to clear and approve at an early stage every possible loan given to a political party. However, it seems to me that one could set a fairly high threshold and ensure that every loan was approved by the Electoral Commission. We are not talking about large numbers of loans; we are talking about a very small group of substantial transactions, which in my view the Electoral Commission should be given the right to approve prior to that money being allocated to a political party. The result would be that many of the clauses in the Bill that we are discussing might not be necessary. Many of the problems alluded to by the noble Lord, Lord Kingsland, about whether it is fair to penalise people who might have acted honourably, would not even arise. In those conditions, approval having been given by the Electoral Commission, the responsibility would have passed to it.

When I discussed this with Sam Younger, he said that he did not have the resources. However, I wonder what resources would be required to police all this in the event that it might go wrong. One has not estimated what might happen in the event that the structure that we are establishing has to be used. What will the cost of that be in terms of carrying out administrative and judicial requirements? All I am saying is that there is another approach to this which is much simpler, and I suggest to the Government that they might want to consider it, even at this late stage. As this Bill moves to the Commons—because we are giving the Bill its first consideration—Members in the other place might want to consider a much simpler approach.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs) 6:45, 7 June 2006

My Lords, it is very difficult at Third Reading to pick up something that is clearly significant, given the way in which my noble friend has raised it. I will read what he said with great care, and as my noble friend knows I will discuss this with him to clarify in my own mind exactly what the issues might be. If it is appropriate, I will have discussions with the other political parties.

On Question, amendment agreed to.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

moved Amendment No. 62:

After Clause 60, insert the following new clause—

"REGULATION OF LOANS: POWER TO MAKE PROVISION FOR CANDIDATES, THIRD PARTIES AND REFERENDUMS

(1) The Secretary of State may by order make in relation to a relevant matter such provision as he thinks appropriate which corresponds to or is similar to any provision of Part 4A of or Schedule 7A to the 2000 Act (the relevant transaction provisions).

(2) A relevant matter is a loan, credit facility or any form of security (whether real or personal) which benefits—

(a) a candidate at an election;

(b) a recognised third party;

(c) a permitted participant in a referendum.

(3) An order under this section may—

(a) amend or repeal any enactment (whenever passed);

(b) create an offence corresponding or similar to any offence created by the relevant transaction provisions;

(c) confer power on the Secretary of State to make provision by order corresponding to any such power in the relevant transaction provisions;

(d) make different provision for different purposes;

(e) make such supplemental, incidental, consequential, transitional or savings provision as the Secretary of State thinks necessary or expedient in connection with the order.

(4) An order under this section which confers power to make an order by virtue of subsection (3)(c) must require the order—

(a) to be made by statutory instrument;

(b) not to be made unless a draft of the instrument containing the order has been laid before and approved by resolution of each House of Parliament.

(5) Subsection (4) does not apply to any power to make provision determining a rate of interest.

(6) The power to make an order under this section is exercisable by statutory instrument.

(7) No such order may be made unless a draft of the instrument containing the order has been laid before and approved by resolution of each House of Parliament.

(8) In this section—

"candidate" has the same meaning as in Part 2 of the 1983 Act;

"credit facility" must be construed in accordance with section 71F(11) of the 2000 Act;

"election" has the same meaning as in section 202 of the 1983 Act;

"permitted participant" has the same meaning as in Part 7 of the 2000 Act;

"recognised third party" has the same meaning as in Part 6 of that Act.

(9) An order under this section must not make provision which is within the legislative competence of the Scottish Parliament.

(10) Subsection (9) does not apply to provision made by virtue of subsection (3)(e)."

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, this amendment provides an enabling power for the Secretary of State to roll out the new provisions in relation to regulated transactions in three further, very specific contexts where there are already existing parallel controls for donations. Those are recognised third parties at national election campaigns; permitted participants at national and regional referendums; and candidates in election campaigns.

The intention is to use the order-making power to replicate as far as possible the regulated transactions regime, which is already in the Bill for political parties and extended to individuals, in each of these three cases making appropriate adjustments to reflect the different contexts. Anything that a political party does is inherently political, and as a consequence it is appropriate to regulate a party's donations and loans at all times. However, recognised third parties, candidates and permitted participants are only regulated when acting in a political capacity. For example, donations to third parties and candidates are only regulated when they are for the purpose of meeting political expenditure related to the election in question. The regulated transactions regime will need to draw a similar distinction.

Another difference arises from the existing position of candidates. The reporting threshold for donations to third parties and permitted participants is currently £5,000, but for candidates it is only £50. There is no provision for the aggregation of donations with other donations of less than £50. Accordingly, we do not think that it would be appropriate or sensible to provide for the aggregation of loans and donations where such small sums are involved. Those are matters of detail. The power is subject to the affirmative resolution procedure, and I look forward to bringing these issues forward to your Lordships' House for discussion. I hope that noble Lords will accept the amendment. I beg to move.

On Question, amendment agreed to.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

moved Amendment No. 63:

After Clause 60, insert the following new clause—

"REGULATION OF LOANS ETC: NORTHERN IRELAND

(1) The Secretary of State may, after consulting the Electoral Commission, by order make provision relating to regulated transactions, controlled transactions or relevant matters which corresponds to or is similar to any provision ("relevant provision") relating to donations for political purposes which is made by, or which may be made under, the Northern Ireland (Miscellaneous Provisions) Act 2006 ("the 2006 Act").

(2) But if a relevant provision has effect, or would have effect, subject to a temporal limitation, a provision of an order under this section which corresponds to or is similar to the relevant provision must be subject to the same temporal limitation.

(3) An order under this section may in particular—

(a) amend, repeal or revoke any provision made by or under an Act of Parliament or Northern Ireland legislation (whenever passed or made);

(b) create an offence corresponding or similar to any offence relating to donations for political purposes created by the 2006 Act;

(c) confer power on the Secretary of State to make provision by order corresponding or similar to any such power relating to donations for political purposes conferred by the 2006 Act;

(d) make different provision for different purposes;

(e) make such supplemental, incidental, consequential, transitional or savings provision as the Secretary of State thinks necessary or expedient in connection with the order.

(4) An order under this section which confers power to make an order by virtue of subsection (3)(c) must require the order—

(a) to be made only after consulting the Electoral Commission;

(b) to be made by statutory instrument; and

(c) not to be made unless a draft of the instrument containing the order has been laid before and approved by a resolution of each House of Parliament.

(5) The power to make an order under this section is exercisable by statutory instrument.

(6) No such order may be made unless a draft of the instrument containing the order has been laid before and approved by a resolution of each House of Parliament.

(7) In this section—

"regulated transaction" has the same meaning as in Part 4A of the 2000 Act (see section 71F of that Act);

"controlled transaction" has the same meaning as in Schedule 7A to that Act (see paragraphs 1 and 2 of that Schedule);

"relevant matter" has the same meaning as in section (Regulation of loans: power to make provision for candidates, third parties and referendums) of this Act (see subsection (2) of that section)."

On Question, amendment agreed to.

Clause 75 [Extent]:

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

moved Amendments Nos. 65 to 68:

Page 107, line 29, column 2, at end insert- "(c) At an election held in Northern Ireland, "What is your date of birth?""

Page 110, line 18, leave out first "In"

Page 110, line 18, after "papers)" insert "is amended as follows.

(2) After paragraph (1ZE) (inserted by section 37(2)) insert—

"(1ZF) A person to whom a ballot paper is not delivered under paragraph (3) of rule 35 following his unsatisfactory answer to the question at entry 1(c) in the table in paragraph (1) of that rule shall, if he satisfactorily answers any other questions permitted by law to be asked at the poll, nevertheless be entitled, subject to the following provisions of this rule, to mark a ballot paper (in these rules referred to as "a tendered ballot paper") in the same manner as any other voter."

(3) "

Page 113, line 21, at end insert—

"PART 5A CONTROL OF LOANS ETC TO INDIVIDUALS AND MEMBERS ASSOCIATIONS

96A The 2000 Act is amended in accordance with paragraphs 96B to 96E.

96B After section 71X (inserted by section 60 of this Act) insert—

"71Y CONTROL OF LOANS ETC: INDIVIDUALS AND MEMBERS ASSOCIATIONS

Schedule 7A, which makes provisions for controlling loans and certain other transactions to individual members of registered parties, associations of such members, and certain elected office holders, shall have effect."

96C After Schedule 7 insert—

"SCHEDULE 7A CONTROL OF LOANS ETC TO INDIVIDUALS AND MEMBERS ASSOCIATIONS

Operation and construction of Schedule

1 (1) This Schedule has effect for controlling loans and certain other transactions where one of the parties to the transaction is—

(a) a member of a registered party,

(b) a members association, or

(c) the holder of a relevant elective office.

(2) The following provisions have effect for the purposes of this Schedule.

(3) References to a controlled transaction must be construed in accordance with paragraph 2.

(4) A reference to a connected transaction is a reference to a controlled transaction falling within paragraph 2(3)(b).

(5) A regulated participant is—

(a) a member of a registered party;

(b) a members association;

(c) the holder of a relevant elective office, whether or not he is a member of a registered party.

(6) A credit facility is an agreement whereby a regulated participant is enabled to receive from time to time from another party to the agreement a loan of money not exceeding such amount (taking account of any repayments made by the regulated participant) as is specified in or determined in accordance with the agreement.

(7) References to each of the following must be construed in accordance with Schedule 7—

(a) the political activities of a party member or a members association;

(b) members association;

(c) relevant elective office;

(d) the responsible person (in relation to a members association), as if for the reference in paragraph 1(9)(b) of that Schedule to donations there were a reference to receipts from controlled transactions.

(8) This Schedule does not have effect in relation to—

(a) a member of the Scottish Parliament, or

(b) a member of a local authority in Scotland, if he is not also a member of a registered party.

Controlled transaction

2 (1) An agreement between a regulated participant and another person by which the other person makes a loan of money to the regulated participant is a controlled transaction if the use condition is satisfied.

(2) An agreement between a regulated participant and another person by which the other person provides a credit facility to the regulated participant is a controlled transaction if the use condition is satisfied.

(3) Where—

(a) a regulated participant and another person (A) enter into a controlled transaction of a description mentioned in sub-paragraph (1) or (2) or a transaction under which any property, services or facilities are provided for the use or benefit of the regulated participant (including the services of any person),

(b) A also enters into an arrangement where a third person (B) gives any form of security (whether real or personal) for a sum owed to A by the regulated participant under the transaction mentioned in paragraph (a), and

(c) the use condition is satisfied, the arrangement is a controlled transaction.

(4) An agreement or arrangement is not a controlled transaction—

(a) to the extent that in accordance with any enactment a payment made in pursuance of the agreement or arrangement falls to be included in a return as to election expenses in respect of a candidate or candidates at a particular election, or

(b) if its value is not more than £200.

(5) Anything given or transferred to an officer, member, trustee or agent of a members association in his capacity as such (and not for his own use or benefit) is to be regarded as given or transferred to the association (and references to money or any other benefit received by a regulated participant accordingly include, in the case of a members association, money or any other benefit so given or transferred).

(6) The use condition is that the regulated participant intends at the time he enters into a transaction mentioned in sub-paragraph (1), (2) or (3)(a) to use any money or benefit obtained in consequence of the transaction in connection with relevant political activities.

(7) For the purposes of sub-paragraph (6), it is immaterial that only part of the money or benefit is intended to be used in connection with relevant political activities.

(8) Relevant political activities are—

(a) if the regulated participant is a member of a regulated participant, any of his political activities as a member of the party;

(b) if the regulated participant is a members association, any of its political activities;

(c) if the regulated participant is a holder of a relevant elective office, any of his political activities.

(9) The Secretary of State may, by order, specify circumstances or any description of circumstances in which an agreement or arrangement falling within any of sub-paragraphs (1) to (3) is not a controlled transaction.

Valuation of controlled transactions

3 (1) The value of a controlled transaction which is a loan is the value of the total amount to be lent under the loan agreement.

(2) The value of a controlled transaction which is a credit facility is the maximum amount which may be borrowed under the agreement for the facility.

(3) The value of a controlled transaction which is an arrangement by which any form of security is given is the contingent liability under the security provided.

(4) For the purposes of sub-paragraphs (1) and (2), no account is to be taken of the effect of any provision contained in a loan agreement or an agreement for a credit facility at the time it is entered into which enables outstanding interest to be added to any sum for the time being owed in respect of the loan or credit facility, whether or not any such interest has been so added.

Authorised participants

4 (1) A regulated participant must not—

(a) be a party to a controlled transaction to which any of the other parties is not an authorised participant;

(b) derive a benefit in consequence of a connected transaction if any of the parties to that transaction is not an authorised participant.

(2) This paragraph does not apply to a controlled transaction if it was entered into before the commencement of section 60 of the Electoral Administration Act 2006.

(3) In this Schedule, an authorised participant is a person who is a permissible donor within the meaning of section 54(2).

(4) The Secretary of State may, by order, specify circumstances or any description of circumstances in which a person who is not a permissible donor is to be treated as an authorised participant.

Controlled transaction involving unauthorised participant

5 (1) This paragraph applies if a regulated participant is a party to a controlled transaction in which another participant is not an authorised participant.

(2) The transaction is void.

(3) Despite subsection (2)—

(a) any money received by the regulated participant by virtue of the transaction must be repaid by the regulated participant to the person from whom it was received, along with interest at such rate as is determined in accordance with an order made by the Secretary of State;

(b) that person is entitled to recover the money, along with such interest.

(4) If—

(a) the money is not (for whatever reason) repaid as mentioned in subsection (3)(a), or

(b) the person entitled to recover the money refuses or fails to do so, the Commission may apply to the court to make such order as it thinks fit to restore (so far as is possible) the parties to the transaction to the position they would have been in if the transaction had not been entered into.

(5) In the case of a controlled transaction where a party other than a regulated participant—

(a) at the time the regulated participant enters into the transaction, is an authorised participant, but

(b) subsequently, for whatever reason, ceases to be an authorised participant, the transaction is void and subsections (3) to (4) apply with effect from the time when the other party ceased to be an authorised participant.

(6) This paragraph does not apply to a controlled transaction if it was entered into before the commencement of section 60 of the Electoral Administration Act 2006.

Guarantees and securities: unauthorised participants

6 (1) This section applies if—

(a) a regulated participant and another person (A) enter into a transaction of a description mentioned in paragraph 2(3)(a),

(b) A is party to a controlled transaction of a description mentioned in section 2(3)(b) ("the connected transaction") with another person (B), and

(c) B is not an authorised participant.

(2) Paragraph 5(2) to (4) applies to the transaction mentioned in sub-paragraph (1)(a).

(3) The connected transaction is void.

(4) Sub-paragraph (5) applies if (but only if) A is unable to recover from the regulated participant the whole of the money mentioned in section 2(3)(a) (as applied by sub-paragraph (2) above), along with such interest as is there mentioned.

(5) Despite sub-paragraph (3), A is entitled to recover from B any part of that money (and such interest) that is not recovered from the regulated participant.

(6) Sub-paragraph (5) does not entitle A to recover more than the contingent liability under the security provided by virtue of the connected transaction.

(7) In the case of a connected transaction where B—

(a) at the time A enters into the transaction, is an authorised participant, but

(b) subsequently, for whatever reason, ceases to be an authorised participant, sub-paragraphs (2) to (6) apply with effect from the time when B ceased to be an authorised participant.

(8) This paragraph does not apply to a regulated transaction if it was entered into before the commencement of section 60 of the Electoral Administration Act 2006.

(9) If the transaction mentioned in section 71F(4)(a) is not a regulated transaction of a description mentioned in section 71F(2) or (3), references in this section and section 71I(2) to (5) (as applied by subsection (2) above) to the repayment or recovery of money must be construed as references to (as the case may be)—

(a) the return or recovery of any property provided under the transaction,

(b) to the extent that such is incapable of being returned or recovered or its market value has diminished since the time the transaction was entered into, the repayment or recovery of the market value at that time, or

(c) the market value (at that time) of any facilities or services provided under the transaction.

Transfer to unauthorised participant invalid

7 If an authorised participant purports to transfer his interest in a controlled transaction to a person who is not an authorised participant the purported transfer is of no effect.

Offences

8 (1) An individual who is a regulated participant commits an offence if—

(a) he enters into a controlled transaction of a description mentioned in paragraph 2(1) or (2) in which another participant is not an authorised participant, and

(b) he knew or ought reasonably to have known that the other participant was not an authorised participant.

(2) A responsible person of a members association commits an offence if—

(a) the association enters into a controlled transaction of a description mentioned in paragraph 2(1) or (2) in which another participant is not an authorised participant, and

(b) he knew or ought reasonably to have known of the matters mentioned in paragraph (a).

(3) An individual who is a regulated participant commits an offence if—

(a) he enters into a controlled transaction of a description mentioned in paragraph 2(1) or (2) in which another participant is not an authorised participant,

(b) sub-paragraph (1)(b) does not apply to him, and

(c) as soon as practicable after knowledge that the other participant is not an authorised participant comes to him he fails to take all reasonable steps to repay any money which he has received by virtue of the transaction.

(4) A responsible person of a members association commits an offence if—

(a) the association enters into a controlled transaction of a description mentioned in paragraph 2(1) or (2) in which another participant is not an authorised participant,

(b) sub-paragraph (2)(b) does not apply to him, and

(c) as soon as practicable after knowledge of the matters mentioned in sub-paragraph (a) comes to him he fails to take all reasonable steps to repay any money which the association has received by virtue of the transaction.

(5) An individual who is a regulated participant commits an offence if—

(a) he benefits from or falls to benefit in consequence of a connected transaction to which any of the parties is not an authorised participant, and

(b) he knew or ought reasonably to have known that one of the other parties was not an authorised participant.

(6) A responsible person of a members association commits an offence if—

(a) the association benefits from or falls to benefit in consequence of a connected transaction to which any of the parties is not an authorised participant, and

(b) he knew or ought reasonably to have known of the matters mentioned in paragraph (a).

(7) An individual who is a regulated participant commits an offence if—

(a) he is a party to a transaction of a description mentioned in paragraph 2(3)(a),

(b) he benefits from or falls to benefit in consequence of a connected transaction to which any of the parties is not an authorised participant,

(c) sub-paragraph (5)(b) does not apply to him, and

(d) as soon as practicable after knowledge comes to him that one of the parties to the connected transaction is not an authorised participant he fails to take all reasonable steps to repay to any person who has provided him with any benefit in consequence of the connected transaction the value of the benefit.

(8) A responsible person of a members association commits an offence if—

(a) the association is a party to a transaction of a description mentioned in paragraph 2(3)(a),

(b) the association benefits from or falls to benefit in consequence of a connected transaction to which any of the parties is not an authorised participant,

(c) sub-paragraph (6)(b) does not apply to him, and

(d) as soon as practicable after knowledge comes to him that one of the parties to the connected transaction is not an authorised participant he fails to take all reasonable steps to repay to any person who has provided the association with any benefit in consequence of the connected transaction the value of the benefit.

(9) A person commits an offence if he—

(a) knowingly enters into, or

(b) knowingly does any act in furtherance of, any arrangement which facilitates or is likely to facilitate, whether by means of concealment or disguise or otherwise, the participation by a regulated participant in a controlled transaction with a person other than an authorised participant.

(10) It is a defence for a person charged with an offence under sub-paragraph (2) to prove that he took all reasonable steps to prevent the members association entering the transaction.

(11) It is a defence for a person charged with an offence under sub-paragraph (6) to prove that he took all reasonable steps to prevent the members association benefiting in consequence of the connected transaction.

(12) A reference to a regulated participant entering into a controlled transaction includes a reference to any circumstances in which the terms of a controlled transaction are varied so as to increase the amount of money to which the regulated participant is entitled in consequence of the transaction.

(13) A reference to a regulated participant entering into a transaction in which another participant is not an authorised participant includes a reference to any circumstances in which another party to the transaction who is an authorised participant ceases (for whatever reason) to be an authorised participant.

(14) This paragraph does not apply to a transaction which is entered into before the commencement of section 60 of the Electoral Administration Act 2006."

Transaction reports: transactions with authorised participants

9 (1) A regulated participant must prepare a report under this paragraph in respect of each controlled transaction entered into by him which is a recordable transaction.

(2) For the purposes of this paragraph a controlled transaction is a recordable transaction—

(a) if the value of the transaction is more than £5,000 (where the regulated participant is a members association) or £1,000 (in any other case); or

(b) if the aggregate value of it and any other controlled benefit or benefits accruing to the regulated participant—

(i) from the same person and in the same calendar year, and

(ii) in respect of which no report has been previously made under this paragraph, is more than £5,000 (where the regulated participant is a members association) or £1,000 (in any other case).

(3) A controlled benefit is—

(a) a controlled donation within the meaning of paragraph 1(3) of Schedule 7;

(b) a controlled transaction.

(4) A controlled benefit which is a controlled donation accrues—

(a) from the permissible donor (within the meaning of section 54(2)) who made it, and

(b) when it is accepted by the donee.

(5) A controlled benefit which is a controlled transaction accrues—

(a) from any authorised participant who is a party to it, and

(b) when it is entered into.

(6) For the purposes of this paragraph, if—

(a) the value of a controlled transaction as first entered into is such that it is not a recordable transaction, but

(b) the terms of the transaction are subsequently varied in such a way that it becomes a recordable transaction, the regulated participant must be treated as having entered into a recordable transaction on the date when the variation takes effect.

(7) A regulated participant must deliver the report prepared in accordance with sub-paragraph (1) to the Commission within the period of 30 days beginning with—

(a) if sub-paragraph (2)(a) applies, the date on which the transaction is entered into;

(b) if sub-paragraph (2)(b) applies, the date on which the benefit which causes the aggregate amount to exceed £5,000 or (as the case may be) £1,000 accrues.

(8) Each report prepared in accordance with sub-paragraph (1) must—

(a) give the name and address of the regulated participant; and

(b) if he is the holder of a relevant elective office, specify the office in question.

(9) Each such report must also give—

(a) such information as is required to be given, in the case of a report prepared in accordance with section 71M, by virtue of paragraphs 2 and 5(2) and (3) of Schedule 6A;

(b) in relation to a controlled transaction of a description mentioned in paragraph 2(1) or (2) above, such information as is required to be given, in the case of a report prepared in accordance with that section, by virtue of paragraph 6 of that Schedule;

(c) in relation to a controlled transaction of a description mentioned in paragraph 2(3)(b) above, such information as is required to be given, in the case of a report prepared in accordance with that section, by virtue of paragraph 7 of that Schedule;

(d) the date on which the transaction is entered into;

(e) such other information as is required by regulations made by the Commission.

(10) In the application of paragraphs 2, 5(2) and (3), 6 and 7 of Schedule 6A in accordance with sub-paragraph (9) above—

(a) any reference to a recordable transaction within the meaning of that Schedule must be construed as a reference to a recordable transaction within the meaning of this paragraph;

(b) any reference to section 71G or section 71F(4)(a) must be construed as a reference to paragraph 3 above or paragraph 2(3)(a) above;

(c) any reference to a regulated transaction or a registered party within the meaning of that Schedule must be construed as a reference to a controlled transaction or a regulated participant within the meaning of this paragraph;

(d) any reference to a transaction report within the meaning of that Schedule must be construed as a reference to a report under this paragraph.

Transaction reports: transactions with unauthorised participants

10 (1) A regulated participant must—

(a) prepare a report under this paragraph in respect of each controlled transaction entered into by him and falling within paragraph 5 or 6(1)(b); and

(b) deliver the report to the Commission within the period of 30 days beginning with the date when the transaction was dealt with in accordance with that paragraph.

(2) Each such report must—

(a) give the name and address of the regulated participant;

(b) if he is the holder of a relevant elective office, specify the office in question.

(3) Each such report in respect of a transaction falling within paragraph 5 must also give—

(a) the name and address of the unauthorised participant;

(b) the nature of the transaction (that is to say, whether it is a loan or a credit facility);

(c) the value of the transaction or, in the case of a credit facility to which no limit is specified, a statement to that effect;

(d) the date on which the transaction was entered into and the date when, and manner in which, it was dealt with in accordance with paragraph 5;

(e) such other information as is required by regulations made by the Commission.

(4) Each such report in respect of a transaction falling within paragraph 6(1)(b) must also give—

(a) the name and address of the unauthorised participant;

(b) the value of the transaction or, in the case of a security to which no limit is specified, a statement to that effect;

(c) a description of the principal features of the transaction mentioned in paragraph 6(1)(a);

(d) where the security given consists in or includes rights over any property, the nature of that property;

(e) the date on which the transaction was entered into and the date when, and manner in which, it was dealt with in accordance with paragraph 6;

(f) such other information as is required by regulations made by the Commission.

Transaction reports: changes to recorded transactions

11 (1) A regulated participant must—

(a) prepare a report under this paragraph in respect of each change to a recorded transaction; and

(b) deliver the report to the Commission within the period of 30 days beginning with the date on which the change takes effect.

(2) A recorded transaction is a transaction recorded in a report under paragraph 9.

(3) There is a change to a recorded transaction if—

(a) another authorised participant becomes party to the transaction (whether in place of or in addition to any existing participant),

(b) there is any change in the details given in relation to the transaction in pursuance of paragraph 9(9), or

(c) the transaction comes to an end.

(4) For the purposes of sub-paragraph (3)(c), a loan comes to an end if—

(a) the whole debt (or all the remaining debt) is repaid;

(b) the creditor releases the whole debt (or all the remaining debt).

(5) There is also a change to a recorded transaction if a person who is not an authorised participant becomes party to the transaction (whether in place of or in addition to any existing participant).

(6) Each report prepared in accordance with sub-paragraph (1) must—

(a) give the name and address of the regulated participant; and

(b) if he is the holder of a relevant elective office, specify the office in question.

(7) Each such report must also give—

(a) details of the change;

(b) the date on which the change takes effect;

(c) in the case of a change falling within sub-paragraph (5), the date when and the manner in which the transaction was dealt with in accordance with paragraph 5 or 6;

(d) such other information as is required by regulations made by the Commission.

Offence of failing to deliver transaction report

12 (1) Where a report required to be delivered to the Commission under paragraph 9(1), 10(1) or 11(1) is not delivered by the end of the period of 30 days mentioned in paragraph 9(7), 10(1) or 11(1)—

(a) the regulated participant, or

(b) (if a members association) the responsible person, is guilty of an offence.

(2) If such a report is delivered to the Commission which does not comply with any requirements of paragraph 9, 10 or 11 as regards the information to be given in such a report—

(a) the regulated participant, or

(b) (if a members association) the responsible person, is guilty of an offence.

(3) Where a person is charged with an offence under this paragraph, it shall be a defence to prove that he took all reasonable steps, and exercised all due diligence, to ensure that any requirements—

(a) as regards the preparation and delivery of a report in respect of the transaction in question, or

(b) as regards the information to be given in the report in question, as the case may be, were complied with in relation to that transaction or report.

(4) Where the court is satisfied, on an application made by the Commission, that any failure to comply with any such requirements in relation to any transaction entered into by a regulated participant was attributable to an intention on the part of any person to conceal the existence or true value of the transaction, the court may make such order as it thinks fit to restore (so far as is possible) the parties to the transaction to the position they would have been in if the transaction had not been entered into.

(5) An order under sub-paragraph (4) may in particular—

(a) where the transaction is a loan or credit facility, require that any amount owed by the regulated participant be repaid (and that no further sums be advanced under it);

(b) where any form of security is given for a sum owed under the transaction, or the transaction is an arrangement by which any form of security is given, require that the security be discharged.

Declaration in transaction report

13 (1) Each report under paragraph 9 or 10 must, when delivered to the Commission, be accompanied by a declaration made by—

(a) the regulated participant, or

(b) (if a members association) the responsible person, which complies with sub-paragraph (2) or (3).

(2) In the case of a report under paragraph 9, the declaration must state that, to the best of the declarant's knowledge and belief, any transaction recorded in the report as having been entered into by the regulated participant was entered into with an authorised participant.

(3) In the case of a report under paragraph 10, the declaration must state that, to the best of the declarant's knowledge and belief, the transaction recorded in the report as having been entered into by the regulated participant has been dealt with in accordance with paragraph 5 or 6.

(4) A person commits an offence if he knowingly or recklessly makes a false declaration under this paragraph.

Existing transactions

14 (1) Paragraphs 9 to 11 have effect in relation to existing transactions as they have effect in relation to transactions entered into after the date on which those paragraphs come into force, except that—

(a) references in paragraph 9 to a controlled benefit do not include references to a controlled donation;

(b) in paragraph 9(2)(b)(i) the words "and in the same calendar year" are omitted;

(c) the requirement in paragraph 9(7), 10(1)(b) or 11(1)(b) is a requirement to deliver the report within the period of 60 days beginning with the date on which that provision comes into force.

(2) An existing transaction is a controlled transaction which, at the date on which paragraphs 9 to 11 come into force, has not come to an end for the purposes of paragraph 11(3)(c).

Register of recordable transactions

15 (1) Section 71V applies in relation to transactions reported to the Commission under this Schedule ("relevant transactions") as it applies to transactions reported to them under Part 4A of this Act.

(2) But in its application in accordance with sub-paragraph (1), section 71V(2) has effect in relation to a relevant transaction as if (instead of requiring the register to contain the details mentioned in paragraphs (a) to (c) of that subsection) it required the register to contain such details as have been given in relation to the transaction in pursuance of paragraph 9(8) and (9), 10(2), (3) and (4) or 11(6) and (7).

16 (1) Paragraph 9 does not apply to holders of relevant elective office.

(2) Sub-paragraph (2) applies in relation to transactions in which a holder of a relevant elective office is a participant if—

(a) the relevant body has in place arrangements requiring the holder of the office to report such transactions, and

(b) the Commission think that the arrangements correspond to the requirements of paragraph 9.

(3) The Commission must make such arrangements as they think appropriate corresponding to section 71V (subject to such modifications as may be prescribed by the Secretary of State in regulations) to maintain a register of such information as they receive relating to such transactions.

(4) In sub-paragraph (2)(a) a relevant body is—

(a) if the holder of a relevant elective office is a member of a body mentioned in paragraphs (a) to (f) of paragraph 1(8) of Schedule 7, that body;

(b) if the holder of a relevant elective office is the Mayor of London, the London Assembly;

(c) if the holder of a relevant elective office is an elected mayor within the meaning of Part 2 of the Local Government Act 2000, the local authority of which he is the mayor.

(5) For the purposes of sub-paragraph (1) it is immaterial whether the transaction is entered into by the holder of the office in that capacity or in his capacity as a member of a registered party.

Proceedings under paragraphs 5 and 12

17 (1) This paragraph has effect in relation to proceedings on applications under paragraphs 5(4) and 12(4).

(2) The court is—

(a) in England and Wales, the county court;

(b) in Scotland, the sheriff, and the proceedings are civil proceedings;

(c) in Northern Ireland, the county court.

(3) The standard of proof is that applicable to civil proceedings.

(4) An order may be made whether or not proceedings are brought against any person for an offence under paragraph 8 or 12(1) or (2).

(5) An appeal against an order made by the sheriff may be made to the Court of Session.

(6) Rules of court may make provision—

(a) with respect to applications or appeals from proceedings on such applications;

(b) for the giving of notice of such applications or appeals to persons affected;

(c) for the joinder, or in Scotland sisting, of such persons as parties;

(d) generally with respect to procedure in such applications or appeals.

(7) Sub-paragraph (6) does not affect any existing power to make rules."

96D In section 156(4) (provision about subordinate legislation), after paragraph (i) insert—

"(ia) paragraph 2(9) or 4(4) of Schedule 7A,".

96E In Schedule 20 (penalties), after the entry relating to paragraph 14(5) of Schedule 7 insert—

Paragraph 8(1) of Schedule 7A (individual regulated participant knowingly enters controlled transaction with unauthorised participant) On summary conviction: statutory maximum or 12 monthsOn indictment: fine or 1 year
Paragraph 8(2) of Schedule 7A (responsible person of members association which enters controlled transaction with unauthorised participant) On summary conviction: statutory maximum or 12 monthsOn indictment: fine or 1 year
Paragraph 8(3) of Schedule 7A (individual regulated participant failing to repay money obtained under controlled transaction with unauthorised participant) On summary conviction: statutory maximum or 12 monthsOn indictment: fine or 1 year
Paragraph 8(4) of Schedule 7A (responsible person failing to repay money obtained by members association under controlled transaction with unauthorised participant) On summary conviction: statutory maximum or 12 monthsOn indictment: fine or 1 year
Paragraph 8(5) of Schedule 7A (regulated participant knowingly benefits from connected transaction involving unauthorised participant) On summary conviction: statutory maximum or 12 monthsOn indictment: fine or 1 year
Paragraph 8(6) of Schedule 7A (responsible person of members association which knowingly benefits from connected transaction involving unauthorised participant) On summary conviction: statutory maximum or 12 monthsOn indictment: fine or 1 year
Paragraph 8(7) of Schedule 7A (individual regulated participant failing to repay value of benefit obtained in consequence of connected transaction involving unauthorised participant) On summary conviction: statutory maximum or 12 monthsOn indictment: fine or 1 year
Paragraph 8(8) of Schedule 7A (responsible person failing to repay value of benefit obtained by members association in consequence of connected transaction involving unauthorised participant) On summary conviction: statutory maximum or 12 monthsOn indictment: fine or 1 year
Paragraph 8(9) of Schedule 7A (facilitating controlled transaction involving unauthorised participant) On summary conviction: statutory maximum or 12 monthsOn indictment: fine or 1 year
Paragraph 12(1) of Schedule 7A (failure to deliver transaction report to Commission within time limit) On summary conviction: Level 5
Paragraph 12(2) of Schedule 7A (failure to comply with requirements for recording transactions on transaction reports) On summary conviction: statutory maximum or 12 monthsOn indictment: fine or 1 year
Paragraph 13(4) of Schedule 7A (making a false declaration about a transaction report) On summary conviction: statutory maximum or 12 monthsOn indictment: fine or 1 year

96F (1) The Secretary of State must not make an order under section 74 for the purposes of paragraph 16 of Schedule 7A to the 2000 Act (as inserted by paragraph 96C) as it applies to the holders of a relevant elective office unless he is informed by the Commission that they are satisfied that they will receive the information mentioned in paragraph 16(2) of that Schedule (as so inserted) in relation to such holders of relevant elective office.

(2) In sub-paragraph (1) references to the holder of a relevant elective office must be construed in accordance with Schedule 7 to the 2000 Act."

On Question, amendments agreed to.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

moved Amendment No. 69:

Page 118, line 30, at end insert—

"In section 3 (appointment of Electoral Commissioners and Commission chairman), in subsection (4)(d) after sub-paragraph (iii) insert ", or

(iv) been named as a participant in the register of recordable transactions reported under Part 4A.""

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

My Lords, I shall also speak to Amendments Nos. 70, 71, 73 and 74. This group of amendments makes minor consequential amendments to the Political Parties, Elections and Referendums Act 2000 to reflect the introduction of the new regime for regulated transactions.

Amendment No. 69 will exclude those people who have made loans to political parties from being eligible to be electoral commissioners. That mirrors the situation that applies to donations. Amendment No. 70 adds new Part 4A of PPERA to the responsibilities of the treasurer of a registered party. It does that through an amendment to Section 24(4)(a) of PPERA, and Amendment No. 71 does the same to the responsibilities of the treasurer of an accounting unit through an amendment to Section 27(2)(a).

Amendment No. 73 amends both Sections 146 and 148 of PPERA. In Section 146, which covers the supervisory powers of the commission, the amendment extends its powers to inspect records relating to loans. Section 148 deals with general offences, and the amendment changes the definition of "supervised individual", "relevant person" and "regulated donee" to include "regulated participants" or those involved with giving loans to political parties. Amendment No. 74 sets out that an electoral commissioner shall cease to hold office if he is named as a participant in the register of recordable transactions—that is, if he gives a loan to a political party. I beg to move.

On Question, amendment agreed to.

Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary, Department for Constitutional Affairs, Parliamentary Under-Secretary (Department for Constitutional Affairs)

moved Amendments Nos. 70 to 78:

Page 118, line 30, at end insert—

"In section 24 (office-holders to be registered), in subsection (4), for paragraph (a) substitute—

"(a) with the provisions of parts 3, 4 and 4A (accounting requirements and control of donations, loans and certain other transactions)"."

Page 118, line 30, at end insert—

" In section 27 (financial structure of registered parties: accounting units), in subsection (2)(a) for "Parts III and IV" substitute "Parts 3, 4 and 4A"."

Page 119, line 19, at end insert—

"(1) Section 62 (quarterly donation reports) is amended as follows.

(2) After subsection (3) insert—

"(3A) "Relevant benefit", in relation to any person and any year, means—

(a) a relevant donation accepted by the party from that person as a donor, or

(b) a relevant transaction within the meaning of section 71M(3) entered into by the party and that person as a participant; and a relevant benefit accrues when it is accepted (if it is a donation) or entered into (if it is a transaction)."

(3) In subsection (4)—

(a) for "donation or donations" (in both places) substitute "benefit or benefits";

(b) after "this subsection" insert "or section 71M(4)";

(c) in paragraph (b) for "donations" substitute "benefits".

(4) In subsection (5), in paragraph (b)—

(a) for "as part of" substitute "together with any other relevant donation or donations included in";

(b) for "donation" (in the second place) substitute "benefit";

(c) for "is accepted" substitute "accrues".

(5) In subsection (6)—

(a) for "donation or donations" (in the first four places) substitute "benefit or benefits";

(b) after "subsection (4)" (in the first place) insert "or section 71M(4)";

(c) in paragraph (a), for "subsection (4)" substitute "that provision";

(d) in paragraph (b), after "this subsection" insert "or section 71M(6)";

(e) for the words following paragraph (b) substitute "any relevant donation falling within subsection (6A)".

(6) After subsection (6) insert—

"(6A) A relevant donation falls within this subsection—

(a) if it is a donation of more than £1,000, or

(b) if, when it is added to any other relevant benefit or benefits accruing since the time mentioned in subsection (6)(a) or (b), the aggregate amount of the benefits is more than £1,000."

(7) In subsection (7)(a), for "donation" (in the first place) substitute "benefit".

(8) In subsection (7)(b)—

(a) for "as part of" substitute "together with any other relevant donation or donations included in";

(b) for "that subsection" substitute "subsection (6A)";

(c) for "donation" (in the second place) substitute "benefit";

(d) for "is accepted" substitute "accrues"."

Page 119, line 22, at end insert—

"(1) Section 146 (supervisory powers of Commission) is amended as follows.

(2) In subsection (7) after paragraph (a) (before "or") insert—

"(aa) a regulated participant (or former regulated participant),".

(3) In subsection (8), after paragraph (a) (before "or) insert—

"(aa) such information or explanations relating to the income and expenditure of regulated participants in connection with the political activities as the Commission reasonably require for the purpose of monitoring compliance on the part of regulated participants with the requirements imposed on them by or by virtue of Schedule 7A,".

(4) In subsection (9), after the definition of "regulated donee" insert—

"regulated participant" and "political activities" in relation to a regulated participant must be construed in accordance with Schedule 7A;".

(1) Section 148(6) (general offences) is amended as follows.

(2) In paragraph (a), after "donee" insert "regulated participant".

(3) In paragraph (b), after sub-paragraph (ii) insert—

"(iia) a regulated participant which is a members association,".

(4) In paragraph (c), after sub-paragraph (iii) insert—

"(iiia) in relation to a regulated participant which is a members association, the person responsible for the purposes of Schedule 7A,".

(5) After paragraph (d) insert—

"(da) "regulated participant" has the same meaning as in Schedule 7A;"."

Page 119, line 22, at end insert—

" In Schedule 1 (the Electoral Commission), in paragraph 3(3) (term of office etc of Electoral Commissioners) after paragraph (c) insert—

"(ca) he is named as a participant in the register of recordable transactions reported under Part 4A;"."

Page 119, line 22, at end insert—

"In Schedule 6, after paragraph 5 insert—