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Cabinet Office: Standards-setting Bodies

Part of the debate – in the House of Lords at 12:04 pm on 29th March 2007.

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Photo of Lord Neill of Bladen Lord Neill of Bladen Crossbench 12:04 pm, 29th March 2007

My Lords, like the noble Lord, Lord Goodhart, I congratulate the noble Lord, Lord Norton of Louth, on bringing this debate before the House. The issue of whether there should be a statutory basis for Cabinet-appointed committees is discussed over the dinner table and in such contexts, but to my knowledge it has never been debated on the Floor of this House. The noble Lord, Lord Norton, brought to his speech a wealth of study from several committees with whose work and history he is familiar.

I have a modest contribution to make; it is entirely pragmatic and based on my knowledge and experience of one such committee, the Standards in Public Life Committee. When the time came for my noble and learned friend Lord Nolan to lay down office—he had been appointed for a three-year term—the noble and learned Lord, Lord Irvine of Lairg, asked me whether I would be willing to succeed my noble and learned friend, which naturally was an impossible task for anyone. I was further asked whether I would be happy for the terms of reference to be extended to include an inquiry into the funding of political parties and more general issues about how the finances of democratic life, so far as it consists of party activity, are to be handled. I thought that that was a challenging remit for the first task that I would undertake.

Before coming to my specific comments, I should like to make one general comment. The principled approach, advocated by the noble Lord, Lord Norton, is that essentially all such committees as we are discussing should have statutory underpinning. Of course, that criterion would create certainty. Although the arguments are not at all the same, the pragmatic approach is not dissimilar. It considers whether you want your highest court in the land to be a committee of the House of Lords or to be hived off and turned into a Supreme Court in a separate building. I will not re-enter the argument. There are two quite different philosophical approaches to that.

Based on my experience, my approach essentially is pragmatic. My first point is on flexibility. Looking back at how the Standards in Public Life Committee was set up, we all recall that there was a period of allegations of sleaze, particularly directed at the Conservative Party and its Members in the other place. In those days, the big issue was cash for questions; today we have in our minds cash for honours. That was the leading point, although there were other severe criticisms of the conduct of particular Members of Parliament.

Although I was not involved at the time, I recall that the then Prime Minister, the right honourable John Major, considered that he had to take drastic action to clean the stables. In October 1994, he set up the committee with the terms of reference:

"To examine current concerns about standards of conduct of all holders of public office, including arrangements relating to financial and commercial activities, and make recommendations as to any changes in present arrangements which might be required to ensure the highest standards of propriety in public life".

I do not know the exact history of how that was drafted, but I suspect that the Cabinet Secretary of the day would have played an important part and a few people would have discussed those terms of reference. Essentially, this was an initiative by the then Prime Minister to deal with what he conceived to be an urgent situation where the good name of politics was in question, because such accusations spill over from one party to another and everyone is tarnished.

While the committee was at work on its first major project, which was the seminal report on standards that laid down the Nolan conditions about standards in public life and the seven principles—it is a remarkable document—the question arose whether the committee could investigate the funding of political parties. In May 1995, around seven months after it had been appointed, the committee's response to this was:

"It would not be within the committee's present terms of reference to examine the overall nature of party political funding and, for example, to address such questions as whether state funding of political parties was desirable".

It went on to explain that the chairman had said that some aspects of the funding of political parties did come within the existing terms. I shall read the last sentence of that statement:

"It would be wholly wrong for political parties to seek or accept funds against an expectation of, or following, the award of public office, honours, contracts or improper influence".

The committee stated that principle.

The incoming Labour Party made it perfectly clear in its 1997 election manifesto and later in the Queen's Speech that it intended to refer to the Nolan committee the question of funding of political parties. A one-sentence amendment was drawn up for the committee stating:

"To review issues in relation to the funding of political parties, and to make recommendations as to any changes in present arrangements".

The obvious points I am making about this, on a pragmatic basis, are that first you had Prime Minister John Major confronted with a situation that needed to be handled with some urgency, and then there was an incoming Government with a problem about the funding of political parties that they had been harping on about for some time and wanted dealt with immediately. How would all that have played out in a statutory context? It would have been completely different. It is hard to imagine a Bill to set up a committee getting through Parliament in less than six months—it would have been fast going for such legislation—and to amend it would have meant further debate and argument. The statutory approach would have had disadvantages.

I shall say more about Lord Nolan's remarks on this later. On accountability, it is crystal clear that the Prime Minister is accountable for the creation of such a committee. The right honourable John Major appointed it and the present Prime Minister continued its existence. He has relied and depended upon it. From 1997 to the present, at any point during Question Time in the House of Commons a Member could have asked, "Why did you set up a body like this? Why does it not have a statutory background? The public are dissatisfied and they do not trust the committee". To my knowledge, not a word to that effect has ever been heard. Any suggestion that the Committee on Standards in Public Life was thought to lack independence seems almost laughable.

On the first morning of my first day on the committee, the name on the letter I had to look at was that of Bernie Ecclestone. I do not need to continue the story. Did we appear to lack independence? From then on, the Government did not agree 100 per cent with our report on the funding of political parties, but they agreed to a high percentage of it. Certainly the media, which obviously I had to meet every time we published an annual report or any other report, could have asked me questions based on the public perception that we lacked independence. It is a completely mistaken idea to think that either we lacked it or were perceived to do so. In fact, at times we have been thought to be a bit of a pain in the neck or thorn in the side of government by coming out with reports and making recommendations that have been very unwelcome.

That takes me on to my second major point: autonomy. The noble Lord, Lord Goodhart, referred to getting the identity of the next topic we were going to investigate agreed with the Cabinet Office and, via that, with the Prime Minister. It is correct that we had dialogue with the Cabinet Office before we undertook a new project, but my recollection is that the committee, when I was chairman, as I was for three and a half years, always had a high moral and philosophical position that, if it came to the crunch, so long as we were there as a committee and our terms of reference were written in the broad language in which they were, it was finally up to us whether we would engage in a particular topic, even if it was thought undesirable by the Executive, particularly the Prime Minister. I do not believe we were ever intimidated out of looking at a subject that we thought ought to be looked at.

The rather loose and informal way in which the committee was set up had advantages. You select people of the requisite integrity and background. We had three Members of Parliament and some admirable people from business and other sections of life who were simply not going to be pushed around. If you tried to push them around, they would simply resign. You can see the advantage of the flexibility of getting the committee set up and in amending its terms of reference and the vagueness about who finally can dictate the next topic. It is my belief that we were in a position where we could always do that.

The disadvantage is that, until the noble Lord, Lord Norton, spoke, one did not know the range of references and so on, so I cannot give him an adequate response, but I can take up his three themes. On independence, the committee I am talking about was perceived to be independent. I am not quarrelling with those who say that it would be safer or better to put other committees on a statutory footing. I do not know about their work—I have not studied them enough—so that may well be correct.

On accountability, I have talked about the accountability of the Prime Minister for the appointment of the committee and allowing it to continue to exist. Were he to dismiss it because it stood in his way, it would be a serious threat to his position. The committee I am talking about had reached such a position that that would have been a highly questionable and politically dangerous course to take. I also agree with the author who was quoted as saying that the committee is accountable to the public. I certainly think that is true of the Committee on Standards in Public Life.

There has been talk about the tenure of office. That seems a straightforward case of sheer incompetence by the Cabinet Office. In my case it was meant to be a three-year term, but I was kept in office for an extra six months, simply, I think, because there was other work going on and no one took the trouble to appoint a successor. I believe that may have happened in other cases; I know of one currently, and the noble Lord, Lord Goodhart, mentioned that there had been three such examples. That incompetence should be addressed. The selection of a new chairman in due course should be treated seriously.

I am speaking about the single committee I know about. The absence of a statutory base has been an advantage, and the Government would be disadvantaged by a prescriptive rule that any standard-setting body must always be created by force of statute.