Second Reading

Part of Political Parties and Elections Bill – in the House of Lords at 6:04 pm on 18th March 2009.

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Photo of Lord Marland Lord Marland Conservative 6:04 pm, 18th March 2009

My Lords, I speak as a former treasurer to the Conservative Party, from 2004 to 2007. I will largely restrict my comments to matters of finance and party funding. Many aspects of the Bill address those issues and issues of disclosure. However, I fear that the Bill does not go far enough. I was co-author, with Andrew Tyrie, of a paper for the leader of the Conservative Party. I also served in the discussion stages with Sir Hayden Phillips. Two things that we tried to demand were a cap on donations and matched funding, to which my noble friend referred earlier.

We live in a world that demands transparency and where the media have become obsessed with political party donors and with what they perceive—I use that word deliberately—as their motives. The Bill, by not imposing a maximum amount per donation, does not address those issues. It cannot be right that there is overdependence on a union or a number of individuals for the annual running costs of a party. It cannot be good for politics and it cannot be good for the parties themselves. Through the passage of the Bill, we must be earnest about changing that.

Neither does the Bill prevent a cash-grab race from taking place, as it does not restrict what political parties may spend in any one year. It cannot be right that, depending on a party's political fortunes and popularity in the polls, one party should be able unreasonably to exceed another in its ability to raise—and therefore to spend—money. A cap on annual running costs would be welcome.

However, the most acute problem is the raising of money for a general election, which effectively doubles the money that a party is required to raise in one year. Large donations are therefore required and the issues of influence and reporting raise their ugly heads again. If we are to get to a consensus on this, we need to resolve how we support parties in their election fundraising initiatives.

Neither does the Bill promote democracy, because it does not produce a plan for financially supporting new political parties, allowing them to campaign—and thereby permitting the nation to debate broader democratic issues—without being dependent on a rich donor. Nor does the Bill financially incentivise political parties to encourage greater turnouts at the ballot box and greater involvement in political debate. A grant scheme or incentive plan is surely an imperative. Yet again, that opportunity has been missed.

Finally, the Bill does not address the undue influence of trade unions or the amount that they are allowed to give the Labour Party. In the last year we have seen the unions bail out the party from its deeply parlous financial state. What is the price of that bail-out? It is totally unreasonable. The Bill does not permit trade union members to opt out of their union contributions being directed to the Labour Party. This must change.

It may seem odd that I welcome the increase in the threshold for a declaration, but the threshold has not changed since 2000 and therefore has not kept pace with inflation or comparable gift-making to other voluntary organisations. This change helps the significant administrative burden on our local associations, which, after all, are made up largely of volunteers, as was said earlier.

I turn now to policing. During my time as treasurer, the Electoral Commission was the most frustrating and inadequate organisation to deal with. It neither policed nor interpreted the legal implications of the 2000 Act adequately. Despite the Conservative Party having a compliance officer, a finance director and a finance board, who tried to maintain regular contact with the commission, it failed in its guidance and liaison with them. Of course, the moment that trouble started, it ran for cover proclaiming its vast innocence. I think that noble Lords opposite will agree with this.

As we all know, the Electoral Commission also failed to monitor the postal voting system and to rigorously police the election process. It is therefore imperative that the people who run it not only understand the Bill but also its relationship with the parties, to help them with interpretation and to work closely to ensure that parties fulfil their obligations. I welcome the fact that there will be four commissioners, but it is important that they understand the workings of political parties. We should not ban former political party executives from being commissioners; we should encourage them, because those people fundamentally understand the workings of political parties. The commissioners should also understand parties' financing, because we must deal with what is an acute problem.

I am afraid that the Bill has been fudge. Despite its great rhetoric, and despite the procrastination, it has failed to address the practical issues of fundraising and how to engage with a wider audience in politics.