Clause 3

Political Parties and Elections Bill – in a Public Bill Committee at on 13 November 2008.

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Civil sanctions

Amendment proposed [this day]: No. 85, in page 2, line 26, at end insert—

‘(1A) The Secretary of State, after consulting the Electoral Commission, shall make an order that specifies what discretionary requirements may be imposed by the Electoral Commission under Part 2 of Schedule 19B.’.—[Mr. Djanogly.]

Question again proposed, That the amendment be made.

Photo of Peter Atkinson Peter Atkinson Conservative, Hexham

I remind the Committee that with this we are discussing amendment No. 77, in schedule 2, page 22, line 26, leave out from ‘requirement’ to end of line 39 and insert

‘such requirements as specified by virtue of section 147(1A).’.

Photo of Michael Wills Michael Wills Minister of State, Ministry of Justice, The Minister of State, Ministry of Justice

I welcome you back to the Chair, Mr. Atkinson. At the end of our previous sitting, I was explaining why we needed to give the commission flexibility. I hope that the Committee will be reassured to know that the commission is required to publish guidance on how it will use the civil sanctions before it is given the power to impose them. We expect that guidance to be issued at the same time as the guidance on the investigatory powers in January 2009. Should our expectation of the delivery of that guidance change, we shall, of course, let the Committee know.

The guidance will provide information that will be set out in the order that the amendment would require. That approach would allow the commission the necessary flexibility to operate the civil sanctions regime effectively. It may also give those regulated the sort of discretionary requirement that the commission would impose and in what circumstances. Amendment No. 77 would amend the definition of a discretionary requirement. In practice, it would remove the legal definition of a discretionary requirement and, because discretionary requirements are a key element of the suite of civil sanctions provided to the commission by the Bill, I hope that the hon. Member for Huntingdon will consider withdrawing the amendment.

Discretionary requirements are defined as a monetary penalty of an amount to be determined by the commission, a requirement to take such steps to ensure an offence or contravention does not continue or reoccur, or a requirement to take steps to resort to what would have been the position if the offence or contravention had not taken  place. The amendment would remove those definitions and amend the proposed new paragraph to remove the legal definition of a discretionary requirement. I know that the Committee has been under considerable pressure and I do not want to labour the point, but we could not find section 147(1A)—it does not seem to exist—with which the amendment would replace the proposed new paragraph under schedule 2. For all those reasons, I hope that the hon. Gentleman will withdraw the amendment.

Photo of Jonathan Djanogly Jonathan Djanogly Shadow Minister (Business, Innovation and Skills), Shadow Solicitor General, Shadow Minister (Justice), Shadow Solicitor General

We are happy to hear confirmation from the Minister about the guidance, and a reconfirmation of its importance. As for the discretionary requirements, the purpose of deletion was not because they need to be deleted, but to have a hook on which to hang a debate about what they should be. On the basis of the Minister’s explanation, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Photo of Nick Ainger Nick Ainger Labour, Carmarthen West and South Pembrokeshire

I beg to move amendment No. 133, in page 2, line 31, column 2, leave out from beginning to end of line 37 and insert ‘A fine of £1,000.’.

Photo of Peter Atkinson Peter Atkinson Conservative, Hexham

With this it will be convenient to discuss the following amendments: No. 82, in page 2, line 33, leave out ‘£20,000’ and insert ‘statutory maximum’.

No. 83, in page 2, line 35, leave out ‘£20,000’ and insert ‘statutory maximum’.

Photo of Nick Ainger Nick Ainger Labour, Carmarthen West and South Pembrokeshire

I join other members of the Committee in welcoming you to our deliberations, Mr. Atkinson. I am sure that the Minister will be pleased to know that we are about to discuss a probing amendment. It provides an opportunity to deal with the theme that runs through the Bill: the move from civil to criminal sanctions. The penalties under section 147 of the Political Parties, Elections and Referendums Act 2000 are clearly civil, and are calculated on the basis of the period in which a person has failed to comply with the requirement to produce documents. The sanctions range from £500 to, ultimately, £5,000 if the individual fails to comply within 12 months. However, in clause 3(3), which deals with the failure to comply with a stop notice, instead of civil actions and penalties, we have criminal actions. On indictment, an individual could be subject to a fine or imprisonment up to two years.

As I said during an evidence session on the Bill, one of my concerns is that while I understand the need for deterrents for those who hold important positions in respect of the responsibilities that are covered by it, I fear that it contains another element of deterrence: the one that will affect volunteers who could face not only civil but criminal sanctions if they do not comply with the legislation. This is a hook on which we can hang that debate.

I am concerned that in this part of the Bill and elsewhere we may well be introducing penalties and sanctions that are not proportionate. I would be interested to hear what the Minister has to say on that, and also what he has to say generally on how we can ensure that the volunteers who are an essential part of all political parties will not be put off from taking important positions  in those parties because they fear that they may be subject not only to a civil penalty but a criminal penalty because of an error, poor advice or whatever it may be.

I think particularly of treasurers of local parties and organisations, and agents for MPs, MSPs and Members of the Welsh Assembly and even elected local government officials. I would be interested to hear what reassurance the Minister can give to members of all political parties that if they do find themselves in a position where they are subject to the regulations set out in the Bill, they will at least face penalties that are proportionate if they are found to be in the wrong.

Photo of Jonathan Djanogly Jonathan Djanogly Shadow Minister (Business, Innovation and Skills), Shadow Solicitor General, Shadow Minister (Justice), Shadow Solicitor General

Amendment No. 133 seeks to remove the summary conviction and indictment penalty tariffs for an offence under paragraph 14 of proposed new schedule 19B, which deals with failure to comply with a stop notice.

We have considerable concerns about the powers to be given to the commission in respect of stop notices. On a fundamental level, giving the commission the power to prevent people from doing what is a lawful act is unsettling and something that we will wish to explore at a relevant point when discussing the schedule. We do not support the imposition of one-size-fits-all penalties and are concerned that the amendment, while well-intentioned in that it would reduce the maximum penalty, would be arbitrary and, in some cases, disproportionate.

Much was made during the lead-up to the Bill of the role of better regulatory regimes and the use of flexible tariffs. Professor Macrory’s review entitled “Regulatory Justice: Making Sanctions Effective” was published in November 2006. At the Government’s instigation, he reviewed the entire system of regulatory sanctions in law at that date. One of the main findings of the report was the existence of the so-called compliance deficit, which arises where the sanctions available to a regulator are not sufficiently flexible to allow them to respond proportionately to offences, the consequence of which is that regulators are reluctant to take enforcement action. One of the stated aims of schedule 2 is to give effect to the proposals in that report and provide the commission with a wider set of sanctioning powers that would allow it more flexibility and proportionality when sanctioning those committing offences under PPERA.

We are concerned that, under the amendment, we could take a step back from that level of flexibility. Having a range of sanctions will always require there to be a significant option available; it may not be used at all, but its existence acts as a deterrent. I am afraid that the amendment would remove that option and possibly undermine the seriousness of the offence. Having said that, we have more sympathy with the Government on whether this should be an indictable crime in the first place. We will be looking at our position in that regard, leading up to Report. We do not support the amendment as currently proposed.

Amendments Nos. 82 and 83, tabled in my name, deal with the level of penalties involved in breaches of stop notices. Paragraph 10 of part 3 of schedule 2 proposes to give the commission the power to impose stop notices on people to prevent them from carrying on an activity that the commission reasonably believes is likely to involve committing an offence or contravention under PPERA. Furthermore, the commission may impose  such a notice where it believes that a person’s activity is likely to lead them to commit an offence or contravention. In both situations, the commission must also reasonably believe that such activities are damaging to public confidence in the PPERA controls on income and expenditure.

Amendments Nos. 82 and 83, which are probing amendments, would amend clause 3(3). They were tabled to discover why the Government feel it necessary to increase the penalty for failure to comply with a stop notice to £20,000—far more than the statutory maximum and the usual penalty throughout the rest of this Bill. We will discuss our objections to stop notices more generally later on.

Photo of David Howarth David Howarth Shadow Solicitor General, Ministry of Justice, Shadow Minister (Shadow Solicitor General), Home Affairs

I am sympathetic to the remarks of the hon. Member for Carmarthen, West and South Pembrokeshire, who moved the amendment, about the difference between criminal and civil sanctions. One might add regulatory sanctions, as well. It is important that proportionality be maintained in looking at what consequences there should be in respect of failures to comply with the requirements of such a law.

With regard to the stop notice, I have more sympathy with the Government’s position, because the stop notice is the equivalent in civil law of an injunction; it is saying to the person concerned, “You must stop doing this now.” The only way in which such a notice should be complied with is by those concerned stopping doing the thing itself. We should not be in a position where, effectively, a person not in compliance with a stop notice—not in compliance with the law—can buy themselves out of compliance by paying the fine. It is not right that, when someone faces the equivalent of an injunction, they can simply pay a small amount of money and carry on doing what they were doing before.

The important question is not the size of the fine or penalty, which is also crucial—if someone disobeys an injunction in ordinary law the penalties are at large and they can go to jail until they comply—but the conditions under which the stop notice can be issued. That is the crucial question. Are the conditions under which stop notices can be issued serious enough to justify an equivalence with a civil injunction? I should like the Minister to explore that in his reply.

The present draft of the schedule talks about serious damage to public confidence. In the Electoral Commission’s view, serious damage to public confidence is enough to justify a stop notice. I want the Minister to say whether that is enough. What circumstances are imagined as leading to serious damage to public confidence? Will it be relevant, for example, that non-compliance happens during an election? Will that make the issuance of a stop notice more or less likely? I am perfectly willing to accept that there are conditions in which a stop notice will be justified. We will get to that point later, but I am not yet entirely clear about exactly what is envisaged as serious damage.

Photo of Michael Wills Michael Wills Minister of State, Ministry of Justice, The Minister of State, Ministry of Justice 1:15, 13 November 2008

Again, the Government clearly recognise all the concerns that have been expressed. I am glad that all the members of the Committee who have spoken on the matter have recognised the need for flexibility and proportionality. That is exactly what the Bill is designed  to introduce. One reason why we introduced it was to deal with the inflexibilities that have transpired in the 2000 Act. We have been guided throughout by our desire to introduce greater flexibility and proportionality into the system.

We all agree that the sanction is serious, and it will be used only in the most serious circumstances. The hon. Member for Cambridge asked what those circumstances might be. In the end, of course, that will be a matter for the Electoral Commission’s judgment. However, we cannot allow the sanctions that might follow serious transgressions to be considered an occupational hazard by someone who is absolutely determined to break donation rules, for example, on a large scale. Such activity during an election could have a decisive outcome on the result. We simply must give the commission the ability to stop such activity, which could decisively turn the outcome of an election. It is important to realise that the power is to be used only in such extreme circumstances, although we can talk about the nature of the penalty.

I shall address the amendments in some detail, because I recognise that concern was raised about the sanction on Second Reading. It is important that I put on the record a detailed account of how we have come to our view. The figure of £20,000 was imported from the Regulatory Enforcement and Sanctions Act 2008, and we saw no reason to vary it. It is worth pointing out that the court will have discretion in imposing a fine for the breach of a stop notice. It does not follow that fines of £20,000 will be automatic or customary for a breach of a stop notice.

It is important to put on record the circumstances in which a stop notice may be served. The commission must reasonably believe that

“the activity as carried on by the person is seriously damaging public confidence in the effectiveness of the controls in this Act on the income and expenditure of registered parties and others, or presents significant risk of doing so”.

Of course, public law principles of reasonableness will require the commission to consider whether its other sanctions would be appropriate first. Only having considered all the other sanctions available to it and decided that they were not appropriate in the circumstances could it consider using this sanction. That is intentionally a very hard test. As with the use of stop notices under the Regulatory Enforcement and Sanctions Act, the person or party concerned will of course retain the right of appeal to a county court, or in Scotland to a sheriff, against the imposition of a stop notice. To support the use of stop notices, sanctions for non-compliance must be available, and they are provided for in clause 3(3).

We have significant reservations about the alternative sanctions suggested in the amendments. I take it that they are probing amendments, but it is important for me to put on record why we are concerned about them. I do not believe that the sanction proposed in amendment No. 133 would take into account the potential scale of an offence or provide for the flexibility that may be required when a sanction is applied for on indictment. We have deliberately ensured the possibility of a weighty financial sanction, because the sanction ought to be serious.

If the transgression revolved around a wealthy donor spending huge sums of money where that was prohibited, a fine of £1,000 would simply not be a  sufficient deterrent, but merely be taken as part of the business. There may also be a case where circumstances are so serious that more than one stop notice had been deployed in respect of the same person or organisation, and those notices would not have been complied with. We should not seek to limit the discretion of the Crown court in this way. Amendments Nos. 82 and 83 would change the financial penalty imposed, reducing it from £20,000 to a statutory maximum of £5,000, for much the same reasons. A fine at such a level would not be sufficient deterrent in circumstances where a severe sanction should apply.

Another significant concern that I have with all three amendments is that they would be making quite an exception to the framework laid down in the Regulatory Enforcement and Sanctions Act, which sets out penalties for a breach of the stop notice in identical terms to the Bill. Again going back to the strictures laid down by the hon. Member for Cambridge at the start of the Committee’s proceedings, we have to be careful about how the public perceive us as proceeding in the Bill. We must be careful about seeking to make exceptions for ourselves—politicians—from other people who are regulated by public bodies, unless there is a genuine distinction to be made. In these circumstances, I find it hard to make such a distinction.

Photo of David Howarth David Howarth Shadow Solicitor General, Ministry of Justice, Shadow Minister (Shadow Solicitor General), Home Affairs

I am grateful for the Minister’s explanation of the clauses. It occurs to me, having heard him, that £20,000 might not be enough. If people are willing to give donations of millions of pounds to political parties—it is worth millions of pounds to them for their party win the election—would £20,000 be a deterrent?

Photo of Michael Wills Michael Wills Minister of State, Ministry of Justice, The Minister of State, Ministry of Justice

That is open to argument, and the hon. Gentleman may have decided to table an amendment to that effect. However, as I say, we have been guided by an Act that is already in force—the House had plenty of time to reflect on it and came to a conclusion, so we thought it appropriate to follow the conclusions in that Act. Of course, as with all such things, the House is always at liberty to revisit the situation in the future. Anyway, on that basis, I hope that the amendment will be withdrawn.

Photo of Nick Ainger Nick Ainger Labour, Carmarthen West and South Pembrokeshire

Having heard the Minister’s explanations and his assurances about proportionality, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question proposed, That the clause stand part of the Bill.

Photo of Jonathan Djanogly Jonathan Djanogly Shadow Minister (Business, Innovation and Skills), Shadow Solicitor General, Shadow Minister (Justice), Shadow Solicitor General

I make it clear at the outset of the debate on clause stand part that the Conservative party accepts that there may be cases where the use of civil sanctions may be more appropriate than the heavy-handed use of criminal sanctions under the Political Parties, Elections and Referendums Act 2000. To that extent, we welcome the clause conceptually. However, we wish to ensure that any use of the new sanctions is proportionate, risk-based and fair, which is why we need to review the effects of the clause.

The Bill provides the commission with a wide range of sanctions to enable it to be a more effective and robust regulator. The January 2007 Committee on Standards in Public Life report picked up on the problems  of the penalty regime available to the commission, noting that the only sanctions that the Electoral Commission has if the parties do not comply with the legislation is to name and shame or, if the offence is sufficiently serious, to refer it to the Crown Prosecution Service. Section 147 of PPERA created a civil penalty for failure to deliver specified documents to the commission. Subsections (3) and (4) are modelled on the financial penalties to which public companies are liable for failure to submit accounts, providing for a range of penalties depending on the length of the period of non-compliance.

Section 148 created general offences intended to guard against tampering with documents or with information to avoid the provisions of PPERA. The section specifically singles out the alteration or suppression of relevant documents, or the withholding or falsifying of information. Section 150, in schedule 20, set out the penalties for all the criminal offences created by the Act. Those are entirely prescriptive and allow for no variation or flexibility to provide for the penalty to be tailored to the offence.

While sections 151 to 153 were concerned with summary proceedings and offences committed by bodies corporate and unincorporated associations, section 154 required the courts to notify the commission of the conviction of any person under the provisions of the Act, or under any other enactment relating to elections. Such notifications were designed to enable the commission to check whether a person registered as a party’s treasurer, as the treasurer of an accounting unit or as a deputy treasurer was disbarred from holding such office.

In a nutshell, those are the powers and sanctions that the commission enjoys. The Committee on Standards in Public Life summarised them in its report and concluded that the only sanction available to the commission where parties did not comply with the legislation was to name and shame or, if the offence was sufficiently serious, to refer the matter to the Crown Prosecution Service. That has resulted in the commission seeming to be reluctant to refer matters to the CPS, because it may be disproportionate to prosecute such an offence and it would not be taken forward by the CPS on the basis that that was not in the public interest. That is the so-called compliance deficit. We have not yet got to the bottom of the further question, which is whether the unwillingness to prosecute is due the lack of legal powers or the lack of management initiative on the part of the Electoral Commission.

In the eight years since its inception, the commission has prosecuted only 29 people for crimes under the PPERA. Even then, only 23 of those ended with a conviction. The need to fill the perceived gap in sanctioning powers with a more proportionate penalty system was understood and the commission was one of its main advocates from the outset. In his 2006 submission to the Committee on Standards in Public Life, Peter Wardle, the chief executive of the commission, expressed just that idea:

“I think the question of administrative penalties is the other area we would be looking for change in the law.”

That was picked up by the Committee on Standards in Public Life, and it formed the basis of recommendation 7 in its report:

“The Government should consider introducing a system of financial penalties, with an appropriate appeal mechanism, that could be applied by the Electoral Commission for non-compliance with the regulatory requirements. Responsibility for prosecution... should continue to lie with the Crown Prosecution Service.”

The Bill therefore aims to provide the commission with a wider range of sanctions to enable it to be a more effective and robust regulator.

The sanctions are based on those recently set out in the Regulatory Enforcement and Sanctions Act 2008, which made provision for a wider range of administrative sanctions to be available to regulators, thereby giving them more options and greater flexibility. The provisions of clause 3 will give the commission new powers to apply a range of civil sanctions to offences committed under PPERA. The clause will substitute proposed new section 147 for the existing section 147 of PPERA. The new section 147 will insert new schedule 19B to the Act, as set out in schedule 2 of the Bill.

The new schedule makes provision for the range of new civil sanctions available to the commission, which includes fixed monetary penalties, discretionary requirements, stop notices and enforcement undertakings. The new schedule goes on to explain when and how the commission can apply the sanctions and what appeal processes are available. I have reviewed the schedule in the run-up to today’s sitting—all 15 pages of it—and I must confess that it has left me unclear about what someone has to do to ensure that they do not become subject to one of its many sanctions.

When we come to the amendments, we must spare a thought for those volunteers in local party offices who will be the ones to implement these new legislative requirements and bear the full force of any penalty that might be incurred. Will they understand the new schedule? I hope so. It might be helpful if the Minister explains how he will ensure that they can understand it.

The commission, rather unsurprisingly, has welcomed the proposals and notes in its memorandum on the Bill that it believes

“the proposed changes to its investigation and sanctioning powers” will allow it to take

“proportionate enforcement action” within

“a well recognised framework of good regulatory practice.”

We support the general principle behind the new sanctioning powers that are to be given to the commission. It must be hoped that the new sanctions will allow it to fulfil its new role as regulator and monitor of party funding, both effectively and proportionately. I would, however, like to put some questions to the Minister on the provenance of those powers.

House of Commons Library research paper 0874 notes that the sanctions are based on those outlined in the Regulatory Enforcement and Sanctions Act 2008, as the Minister said. That Act has recently been enacted on the back of the Hampton review, which was commissioned by the Government in 2004, and the Macrory review of the following year. The Hampton review looked specifically at how the administrative burden of regulation on businesses could be reduced at the same time as preserving regulatory outcomes. It looked also at the work of 63 national regulators and 468 local authorities. Will the Minister address the question whether the commission was included as one of those who were consulted? I cannot see that it was, but the Minister may put me right.

The Macrory review was far more wide-ranging, with the Government asking Professor Macrory to review the entire system of regulatory functions. The major theme of the recommendations in the Hampton review was to call for a risk-based approach to regulatory enforcement, involving greater and more consistent use of risk assessment techniques. Risk assessment is an essential means of directing regulatory resources where they can have maximum impact and outcome. Will the Minister tell hon. Members whether a risk assessment was undertaken when reviewing the proposed new powers of the commission? If it was, will he give details of how the assessment was made and what the results were?

We in the Conservative party feel that a far riskier area is that of electoral malpractice and fraud, which is not dealt with under the Bill or covered by the commission’s new powers. Our admittedly non-scientific risk assessment is that the Government have made a glaring error in not including such provisions in the Bill. Will the Minister explain how that was not picked up in the Government’s risk assessment? If it was, why did the Government choose not to include those powers in the Bill?

Professor Macrory’s findings were published in November 2006 and were aimed at balancing the needs of workers, consumers, the environment and compliant businesses with the need to take effective action against those businesses that intentionally and knowingly fail to comply with regulatory obligations on time.

The Government were quick to accept the conclusions of the review which at its heart had two key concepts. The first is the concept of restorative justice, which seeks to change behaviour and redress the harm caused, as much as simply to punish wrongdoing. The second is the so-called compliance deficit, which arises where the sanctions available to a regulator are not sufficiently flexible to allow it to respond proportionately to offences. The consequence of that is that regulators are reluctant to take enforcement action.

These ideas manifested themselves in what Professor Macrory called the six penalties principles. A sanction should first aim to change the behaviour of the offender. Secondly, it should aim to eliminate any financial gain or benefit from non-compliance. Thirdly, it should be responsive and consider what is appropriate for the particular offender and the regulatory issue, which can include punishment and the public stigma that should be associated with a criminal conviction. Fourthly, it should be proportionate to the nature of the offence and the harm caused. Fifthly, it should aim to restore the harm caused by regulatory non-compliance where appropriate. It should sixthly aim to deter future non-compliance. The better regulation section of the Department for Business, Enterprise and Regulatory Reform website summarises the review’s recommendations and the implementing measures in the 2008 Act.

The Government accepted the report’s recommendations in full and without question by taking them forward as the central core of the 2008 Act. They have taken the same approach in the Bill. From what I can see, they have simply provided for the wholesale inclusion of those recommendations, without specific regard to the unique position of the commission. Will the Minister address that important issue?

Will the Minister tell us what consultation process was undertaken as a precursor to the inclusion of these powers in the Bill? How have they been tailored to fit the remit of the commission? Were equivalent systems in other countries looked at as part of that process?

Finally, I want to touch on the question of safeguards and proportionality. We are being asked to grant the commission what it asks for: a package of flexible sanctions that provides them with an arsenal of wide-ranging enforcement powers. However, what have we had from the commission to show that it knows how to use such powers? What safeguards are in place to stop the powers being abused further down the line by commissions of the future?

We wish to investigate that through our amendments to schedule 2. How often can we expect to see stop notices falling through the letter box of party donors up and down the UK? Will the commission continue to show the same unwillingness it showed with its sanctioning powers under the PPERA? Will the Minister give hon. Members any research that has been done on the need for these news powers?

The commission’s memorandum on the Bill stated that it was able to use these powers only when satisfied beyond reasonable doubt that an offence or contravention of PPERA had occurred. It went on to state that the commission need have only reasonable belief to issue stop notices, with the added element that the action they are stopping poses significant risk of undermining public confidence in the effectiveness of the law on party and election funding.

Does the Minister agree with the assertion that the Bill

“rightly applies high thresholds to our use of these sanctions”?

We are not entirely convinced. Given our debates on the amendments, I am not sure that the assertion is correct. I would like to know the Minister’s position on the matter.

Photo of David Howarth David Howarth Shadow Solicitor General, Ministry of Justice, Shadow Minister (Shadow Solicitor General), Home Affairs 1:30, 13 November 2008

I suspect that it will not be popular to say so, but I support the clause on the basis of what I said earlier. As referred to several times by the Minister, politicians must not give themselves arbitrary exemptions from regimes of the kind that they impose on others. It is perfectly possible to object on principle to the idea of administrative fines and regulatory sanctions of this sort. An objection could be made on the grounds that it is wrong for a regulatory body to be the judge in its own cause. For example, the regulatory body is effectively the investigator, the prosecutor and the imposer of fines, which are subject to appeal. However, on many occasions, that principle has been given away in other legislation with regard to other members of the public. That goes to back to the Inland Revenue, which is the original governmental organisation that was given the power to impose such administrative fines on citizens.

It seems to me that the clause must be right in principle. It sets up a regime for politics that is the same as that used generally in regulatory enforcement. The hon. Member for Huntingdon is quite right that the principles in the 2008 Act have been applied to the areas covered by the Electoral Commission. That is absolutely the right thing to do in the clause, although there is room for debate about details and specific applicability.

I did not understand what the hon. Gentleman was getting at when he suggested that there was a commission enforcement deficit because of management failure to invoke criminal sanctions via the CPS, as opposed to the commission’s argument that it did not have proper flexibility in the range of sanctions available to it. If that is his position, he is advocating the greater criminalisation of political activity, which is quite the opposite of what we both want in this field.

Photo of Jonathan Djanogly Jonathan Djanogly Shadow Minister (Business, Innovation and Skills), Shadow Solicitor General, Shadow Minister (Justice), Shadow Solicitor General

No. I made it quite clear at the start of my remarks that we support a proportionate civil response procedure. That does not mean that we should not look at how the Government came up with that procedure, whether it fits the Bill exactly or whether lifting it is adequate.

Photo of David Howarth David Howarth Shadow Solicitor General, Ministry of Justice, Shadow Minister (Shadow Solicitor General), Home Affairs

I do not think that is an explanation of the hon. Gentleman’s implied attack on what the commission is doing, which was wrong. The commission is correct to say that it has lacked proper flexibility in what it can do in the light of breaches of the legislation. It needs greater flexibility, and it is right that the kind of regime that is applied in other areas of regulation is at least the starting point for dealing with such breaches.

The hon. Gentleman is perfectly entitled to ask questions about specific examples and particular sanctions. It is clear that the reason for the proposal is the applicability to this area of what is now the normal way of dealing with regulatory sanctions. That seems perfectly proper and I support the clause.

Photo of Michael Wills Michael Wills Minister of State, Ministry of Justice, The Minister of State, Ministry of Justice

When we published the White Paper on party funding on 16 June 2008, we announced our intention to legislate to make the Electoral Commission a more effective regulator. An important part of achieving that aim is to provide the wide range of more flexible civil sanctions set out in the clause. Empowering the Electoral Commission better to fulfil its mandate of regulating the political field has been the subject of numerous independent reviews. It was recommended in the 2007 Committee on Standards in Public Life report, and it was supported by the Sir Hayden Phillips report on party finance and expenditure.

There was a strong and emerging consensus that, under the new approach, the commission should be a proactive regulator and that there must be civil sanctions that can be applied directly so that the commission can enforce the framework laid down in the 2000 Act more effectively.

We looked at international comparisons and jurisdictions, and we decided that UK domestic experience was more important, so we largely transposed the 2008 Act, although we have tailored it where we thought that appropriate. The stop notices that we have been discussing, for example, show how we have tailored its provisions.

The hon. Member for Huntingdon talked about the perceived need for the proposal, and wondered about the unwillingness of the Electoral Commission to prosecute, but the Electoral Commission does not prosecute—the CPS does. We cannot blame the Electoral Commission for not proceeding in an area in which it does not have competence to do so. I refer to schedule 2 in this stand part debate because its detail supports and is linked to clause 3. Clause 3 substitutes section 147 of PPERA and gives effect to a proposed new schedule—19B—which is set out in schedule 2 of the Bill.

The clause and schedule give the Electoral Commission access to a flexible range of civil sanctions that may be imposed in relation to certain offences and contraventions under the 2000 Act. Proposed new schedule 19B sets out the range of new civil penalties available to the commission when it is able to apply those sanctions. It also sets out to whom they may apply and what appeal processes are available to an individual or organisation subject to a sanction. The civil sanctions made available mirror those set out in the 2008 Act: fixed monetary penalties, discretionary requirements, stop notices and enforcement undertakings.

The hon. Gentleman asked, as he often does, why the Bill is not tackling electoral fraud. He knows that we take this matter—it is a problem—as seriously as anybody else does.

Photo of Michael Wills Michael Wills Minister of State, Ministry of Justice, The Minister of State, Ministry of Justice

With all respect, the hon. Gentleman needs to recognise the fact that not every Bill has to tackle every single issue. As he well knows, we have already taken significant measures to deal with electoral fraud. I hope that he will now tell me what measures we have reasonably taken, because he persists in intervening and making statements that suggest that he is completely unaware of them. Can he tell us?

Photo of Jonathan Djanogly Jonathan Djanogly Shadow Minister (Business, Innovation and Skills), Shadow Solicitor General, Shadow Minister (Justice), Shadow Solicitor General

I repeat that witness after witness came to the Committee a couple of weeks ago saying that the Bill should deal primarily with electoral fraud.

Photo of Michael Wills Michael Wills Minister of State, Ministry of Justice, The Minister of State, Ministry of Justice

With respect to the hon. Gentleman, he may be referring to the evidence of Sir Christopher Kelly. If he bears with me, I will read out exactly what was said. [Interruption.] All right, the hon. Gentleman does not want to hear it, but I will address the point directly. As he cannot tell us what measures we have taken, let me mention some of them.

We have introduced a system of personal identifiers for postal voters to ensure that postal votes counted in an election are valid. The evaluation reports produced by the Electoral Commission on elections in 2007 and 2008 show a reduction on previous years in the number and scale of allegations of electoral offences. The reports concluded that the action taken had a positive impact on the safety and security of the electoral system.

All I can say to the hon. Gentleman is that of course we take these matters seriously. We cannot be complacent about any instance of electoral fraud. We have taken action, are taking action and will do so in future should it be necessary. The Electoral Commission reports seem to suggest that the actions we are taking are proving effective. That is not to say that we will not return to the matter in future legislation. However, we are dealing with important measures in this Bill, and as the entire Committee will be aware, they are causing considerable concern and are taking considerable time. It is important that we deal with them properly.

So far, the hon. Gentleman has not suggested for one second that any single measure in the Bill is unimportant and should not be dealt with.

Photo of Jonathan Djanogly Jonathan Djanogly Shadow Minister (Business, Innovation and Skills), Shadow Solicitor General, Shadow Minister (Justice), Shadow Solicitor General 1:45, 13 November 2008

I hope that the Minister thinks that we are dealing with the measures in the Bill. I have been taking the Committee seriously. I want to return to the single measure that the Minister claims to have brought in to deal with electoral fraud—the introduction of personal identifiers. Yes, that measure ended up with the introduction of signatures, but that can hardly be called significant in the context of what should be done, which is to use national insurance numbers.

Photo of Peter Atkinson Peter Atkinson Conservative, Hexham

Order. In my normal charitable way, I have allowed a debate on a subject that is not relevant to clause 3. I ask both speakers to bring this point to a close. There will be an opportunity to return to the subject later.

Photo of Michael Wills Michael Wills Minister of State, Ministry of Justice, The Minister of State, Ministry of Justice

I am sure that the hon. Member for Huntingdon will seek to repeat his refrain frequently. When we return to the subject, I hope that Opposition Members remember what I have had to say and the conclusions of the Electoral Commission, and that they read the evidence with more care than they appear to have used so far.

I was endeavouring to respond to comments, but I will now address clause 3. As members of the Committee will be aware, the Bill does not set out which offences under the 2000 Act could attract civil sanction in lieu of criminal prosecution. That will be done through secondary legislation. I believe that the new powers will allow the Electoral Commission to become a more robust and effective regulator, enabling it to intervene more rigorously when the rules of the 2000 Act are not observed.

Question put and agreed to.

Clause 3 ordered to stand part of the Bill.