Interests of Members of the Scottish Parliament Act 2006 and Code of Conduct

– in the Scottish Parliament at on 20 January 2011.

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Photo of Alasdair Morgan Alasdair Morgan Scottish National Party

The next item of business is a debate on three motions—S3M-7724, S3M-7725 and S3M-7726, all in the name of Gil Paterson, on the Standards, Procedures and Public Appointments Committee’s reports on modifications to the schedule to the Interests of Members of the Scottish Parliament Act 2006; on determinations to that act; and on proposed changes to the code of conduct for members of the Scottish Parliament.

Photo of Gil Paterson Gil Paterson Scottish National Party

Members—although there are not many of them here—might be more interested in this debate, which is bit less technical.

The central recommendations before Parliament today were born of the committee’s inquiry into registrable interests. Following the passing of the Interests of Members of the Scottish Parliament Act in 2006, a new regime came into force at the start of this parliamentary session.

The purpose of the register of interests and of members’ declaring relevant interests during parliamentary proceedings is to ensure that the activities of members of Parliament that may impact, or could be perceived to impact, on the manner in which they undertake their duties as parliamentarians are open to scrutiny by the public.

Over the course of this session, the SPPA Committee has considered a number of complaints under the code and members have lodged several hundred register entries. In the light of that experience, some questions arose about the new interests framework, and the committee decided to carry out an inquiry into its operation.

In undertaking the inquiry, the committee was guided by the following principles. First, the register of members’ interests should capture significant financial interests. Secondly, that should be done in the simplest possible way to make it as straightforward as possible for members to comply with the registration requirements. Last, but certainly not least, any proposed changes should be in the public interest and ensure that transparency and accountability are maintained. We believe that the inquiry recommendations clarify and simplify the register of members’ interests in line with those principles.

The committee proposes the following main changes to the categories of interest in the schedule to the 2006 act, and corresponding changes to the code. The remuneration category will be merged with the related undertakings category and members will no longer be required to register certain minor interests in that category. The election expenses category will be removed, given that those interests are already captured in members’ returns to the Electoral Commission. The information held by the Electoral Commission will be easily accessible on the Parliament’s website next session to ensure that anyone seeking the full picture of a member’s expenses will be able to view them easily. The sponsorship category will be removed, as its terms overlap significantly with the gifts category. In practice, a limited number of registrations fall under that category, and the majority of those will fall under the gifts category in future. The gifts category will fix the registration threshold for gifts at the start of a session instead of increasing the threshold as and when members’ salaries increase. The same change will apply to the heritable property and interest in shares categories. The gifts category will also exempt from registration donations towards election expenses, again because those are captured by the Electoral Commission. The overseas visits category remains unchanged.

The Interests of Members of the Scottish Parliament Act 2006 determination 2011, which is set out in annex E of the committee’s report, “MSPs’ Registrable Interests: Proposed Changes to the Code of Conduct”, sets out the form and content of the written statements that members of the Parliament are required to submit to the Standards, Procedures and Public Appointments Committee clerks at the start of the next session. That determination, which will replace the 2007 determination, reflects the changes to the categories proposed by the committee.

The determination will take effect from the date after the date of the first dissolution of the Parliament following the date on which this resolution is passed. Once that date is definite, the determination will be amended to reflect it.

Once the sums of money equal to 1 per cent and 50 per cent of a member’s salary are set out, the determination will be updated to reflect those figures where indicated. That will inform members of the financial thresholds for registering certain categories of interest.

The committee is required to consult Parliament on its recommendations, and so it issued a consultation to all members in June. We offer our thanks to those who responded, including those who responded to confirm that they supported the proposals in full. I also thank the Scottish Parliamentary Standards Commissioner for his response, which included his clear support for the recommendations on election expenses.

The committee has made changes to its proposals in response to comments from members, including the removal of a proposal to exempt the requirement to register remuneration by virtue of a member’s being a member of a cross-party group.

The committee did not consider it necessary to change its position in response to consultation on points to which it had given close consideration when developing its proposals.

The proposals that are set out in the report will come into force in the next session of Parliament. The changes to the code are mainly a result of the committee’s inquiry, but a number of other minor changes are proposed and are set out in the full report.

The committee is very aware of the wider context, and we appreciate that provisions in the Scotland Bill, which is being considered by the United Kingdom Parliament and the Scottish Parliament, may fundamentally change the nature of the members’ interests regime. Assuming that the resulting act contains provisions on members’ interests, transitional provisions will need to be put in place to allow the Scottish Parliament time to consider whether it wishes to make any fundamental changes to the existing regime. The 2006 act would then need to be amended or possibly even replaced to reflect those changes. As a result, it is likely to take the majority of the next Scottish parliamentary session to implement any significant changes.

The committee’s proposed revised categories are therefore likely to be in place for the next parliamentary session. If the interests regime is revised following the implementation of the Scotland Bill, I sincerely hope that the underpinning principles that the committee has used as a basis for making the changes informs the development of any future regime.

I move,

That the Parliament, considering that it is expedient to make certain modifications to the Schedule to the Interests of Members of the Scottish Parliament Act 2006 (asp 12), in exercise of the powers conferred by paragraph 10(1) of that Schedule— makes the modifications to that Schedule that are contained in the Annexe to this resolution; and provides that those modifications shall come into force on the date after the date of the first dissolution of the Parliament following the date on which this resolution is passed.

ANNEXE

MODIFICATIONS TO THE SCHEDULE TO THE INTERESTS OF MEMBERS OF THE SCOTTISH PARLIAMENT ACT 2006

Remuneration

1 (1) In the heading to paragraph 2 (Remuneration) of the Schedule, after “Remuneration” insert “and Related undertaking”.

(2) Paragraph 2 is amended as follows.

(3) At the beginning of that paragraph, insert—

“(A1) Where the circumstances are as described in sub-paragraph (1) or (1A).”

(4) In sub-paragraph (1)(f), delete the words “or any other work”.

(5) After sub-paragraph (1), insert

“(1A) Where a member is, or was—

(a) a director in a related undertaking; or

(b) a partner in a firm, but does, or did, not receive remuneration by virtue of being such a director or partner.”

(6) In sub-paragraph (2), insert after “corporation” the words “or of Convener, deputy Convener or member of a Committee of the Parliament”.

(7) After sub-paragraph (2), insert—

“(3) Sub-paragraph (1) does not apply where the remuneration received from a person on a single, or on more than one, occasion during the current parliamentary session consists solely of expenses unless those expenses amount, or amount in aggregate, to more than the specified limit.

(4) The exception in sub-paragraph (3) applies even although the remuneration received from that person on another occasion, or on other occasions, during that session does not consist solely of expenses.

(5) In this paragraph—

“current parliamentary session” means the parliamentary session which begins immediately after, or in which, the member is returned;

“a related undertaking” is a parent or subsidiary undertaking of an undertaking of which the member is a director and receives remuneration as a director as mentioned in sub-paragraph (1)(d); and

“specified limit” means 1% of a member’s salary (rounded down to the nearest £10) at the beginning of the current parliamentary session.”

Related undertaking, Election Expenses and Sponsorship

2 Paragraphs 3 (Related Undertaking), 4 (Election expenses) and 5 (Sponsorship) of the Schedule are deleted.

Gifts

3 (1) Paragraph 6 (Gifts) of the Schedule is amended as follows.

(2) In sub-paragraph (1), delete sub-paragraph (a) and the words “(b) that gift meets” and insert—

“(a) in the case where the gift was received from a person on a single occasion, the value of that gift, at the date on which it was received, exceeds the specified limit; or

(b) in the case where gifts were received from that person on more than one occasion during the current parliamentary session, the aggregate value of those gifts, at the dates on which they were received, exceeds the specified limit and, in either case,

(c) that gift or those gifts meet”

(3) In sub-paragraph (2),

(a) after “to” insert “(a)”;

(b) delete “(a)” (where it occurs for the second time) and insert “(i)”;

(c) delete “(b)” and insert “(ii)”; and

(d) after “the case may be” delete the full stop and insert—

“;

(b) any support (of any kind) provided by the services of a volunteer which are provided in that volunteer’s own time and free of charge; or

(c) a donation (of any kind) which is intended by the donor to be used for the purpose of meeting

(i) any campaign expenditure incurred in connection with the member’s campaign for election to a party office;

(ii) the election expenses of the member in relation to the election at which that member was returned as a member of the Scottish Parliament; or

(iii) the election expenses of the member in relation to any UK parliamentary election at which that member stands as a candidate, but this exemption ceases to apply if the donation is not used for its intended purpose by the expiry of the 35th day after the election result is declared.”

(4) In sub-paragraph (3),

(a) delete “sub-paragraph (1)” and insert “this paragraph—

“candidate” has the same meaning as in section 118A, as read with section 90ZA(5) of the Representation of the People Act 1983;1

“campaign expenditure” includes expenditure incurred, whether before or after the member’s candidacy for election to the party office is announced or after the date on which the result of that election is declared, which can reasonably be described as being for the purposes of that campaign;” and

(b) in the end of the definition of “controlling interest” delete the fullstop and insert—

“;

“current parliamentary session” means the parliamentary session which begins immediately after, or in which, the member is returned;

“election expenses”, in relation to a member, has the same meaning for the purposes of

(i) sub-paragraph (2)(c) (ii) as “election expenses” has in relation to a candidate in the order under section 12 of the 1998 Act which is in force for the purposes of the election at which the member was returned; and

(ii) sub-paragraph (2)(c)(iii) as “election expenses” has in section 90ZA of the Representation of the People Act 1983;2

“party office” means an office in a registered political party with which that member is connected;

“registered political party” means a political party registered under Part II of the Political Parties, Elections and Referendums Act 20006 and a member is “connected with” a registered political party if the member was returned at the election after contesting it as a candidate (whether for return as a constituency member or as a regional member) of that party; and

“specified limit” means 1% of a member’s salary (rounded down to the nearest £10) at the beginning of the current parliamentary session.“

Heritable Property

4 (1) Paragraph 8 (Heritable property) of the Schedule is amended as follows.

(2) In sub-paragraph (2)(a), delete the words “50 per cent of a member’s salary on that date (rounded down to the nearest £10)” and insert “the specified limit”.

(3) Delete sub-paragraph (2)(b) and insert—

“(b) any income is received from the heritable property during the twelve months prior to the relevant date.”

(4) In sub-paragraph (3)(a), delete “his or her own” and insert “ the member’s”.

(5) After sub-paragraph (7) insert—

“ (8) In this paragraph—

“current parliamentary session” means the parliamentary session which begins immediately after, or in which, the member is returned; and

“specified limit” means 50% of a member’s salary (rounded down to the nearest £10) at the beginning of the current parliamentary session.”

Interest in shares

5 (1) Paragraph 9 (Interest in shares) of the Schedule is amended as follows.

(2) In sub-paragraph (2)(b), delete the words “50 per cent of a member’s salary on that date (rounded down to the nearest £10)” and insert “the specified limit”.

(3) In sub-paragraph (3), delete “apply”.

(4) In sub-paragraph (3)(a), delete “his or her own name” and insert “ the name of the member (or relevant person)”.

(5) In sub-paragraph (8),

(a) insert after “paragraph”—

““current parliamentary session” means the parliamentary session which begins immediately after, or in which, the member is returned;”

(b) delete the words “(a)” and “and (b)”; and

(c) at the end of that sub-paragraph, delete the full stop and insert— “ ;

“specified limit” means 50% of a member’s salary (rounded down to the nearest £10) at the beginning of the current parliamentary session.”

1 1983 c 1

2 1983 c. 1

That the Parliament, in exercise of the powers conferred by sections 4(1) and 4(2) of the Interests of Members of the Scottish Parliament Act 2006 (asp 12)— makes the Interests of Members of the Scottish Parliament Act 2006 (Form and Content of Written Statement) Determination 2011 as set out in Annexe E of the Standards, Procedures and Public Appointments Committee’s 9th Report 2010 (Session 3), MSPs’ Registrable Interests: Proposed Changes to the Code of Conduct with effect from the date after the date of the first dissolution of the Parliament following the date on which this resolution is passed; revokes the Interests of Members of the Scottish Parliament Act 2006 (Form and Content of Written Statement) Determination 2007 with effect from the date after the date of the first dissolution of the Parliament following the date on which this resolution is passed; and revokes the Interests of Members of the Scottish Parliament Act 2006 (Gross Income from Heritable Property) Determination 2007 with effect from the date after the date of the first dissolution of the Parliament following the date on which this resolution is passed.

That the Parliament agrees to amend the Code of Conduct for Members of the Scottish Parliament by replacing Volumes 1 and 2 with Volumes 1 and 2 as set out in Annexe D of the Standards, Procedures and Public Appointments Committee’s 9th Report 2010 (Session 3), MSPs’ Registrable Interests: Proposed Changes to the Code of Conduct, with effect from the date after the date of the first dissolution of the Parliament following the date on which this resolution is passed.

Photo of Nanette Milne Nanette Milne Conservative

My contribution to the debate will be brief and fairly general.

We have heard from the committee convener the detail of why we thought it appropriate to carry out an inquiry to look at the schedule to the 2006 act, which defines the categories of registrable interest, and section 2 of the code of conduct, which gives further guidance on what interests require to be registered, and then to suggest changes to them that would come into force at the start of the next parliamentary session in May.

I, too, pay tribute to the committee clerks and the legal team, who put so much effort into the very detailed work that was required in reviewing the schedule and formulating the proposed amendments to it and the necessary changes to the code of conduct that arise from those amendments.

It took a lot of detailed consideration and discussion to arrive at the amendments that are now before the Parliament. I hope that members will agree that the committee has managed to achieve the intended clarity and simplification of the register of members’ interests as outlined in the principles that guided the committee’s deliberations—notably, that the register should capture significant financial interests; that it should be as straightforward and simple as possible for members to comply with the register’s requirements; and that the proposed changes should be in the public interest and ensure that transparency and accountability are maintained. We hope that that will be achieved by reducing the number of interest categories in the schedule from eight to five and by amending the remaining categories, as outlined by Gil Paterson.

The only category that I will discuss at length is remuneration. It is in the public interest that significant financial interests that could influence or be perceived to influence a member’s views or actions should be registered, but if many interests that are so trivial that they are unlikely to create the appearance of prejudice are recorded, no useful purpose is served. The definition of remuneration that is in use also makes registrable some interests that most people who read them would not look on as remuneration.

The committee felt that it was important that the code of conduct made clear as far as possible what is and is not registrable. An example that vexed most members, including me, was participation by members in opinion surveys by organisations that make a small payment for that participation directly to a charity that members nominate. The legal advice is that, because a member can direct where such a donation is paid, it falls within the definition of remuneration and should be registered. I will not go into other such examples, but I think that the proposed changes to the remuneration category will help members to decide when they need to make an entry in the register of interests.

If the registrable threshold for gifts, heritable property and shares is fixed at the start of the parliamentary session rather than being raised whenever members receive a salary increase, as has happened until now, that will make it more straightforward for members in the next parliamentary session to register those items.

I have only skimmed the surface of the proposed changes to the schedule and the code of conduct, but I hope that the Parliament will appreciate the committee’s efforts in reaching our conclusions and will see the merit in what is proposed. I hope that the motion on the schedule and all the other committee motions that are being debated will be agreed to at decision time.

Photo of Jim Hume Jim Hume Liberal Democrat

I am pleased to have the opportunity to mark my nearly 24-hour anniversary as a member of the committee with a speech in the debate. Although I am a newcomer to the committee, it is obvious to me that the clerks, the Scottish Parliament information centre and other committee staff have worked hard and diligently to prepare the reports. I thank them for their work, the respondents for their contributions to the consultation and my fellow committee members for their efforts.

No procedures, regulations or code can be perfect, which is why it is only proper that we keep the code by which all of us abide under regular review. Many of the changes are just general housekeeping of the schedule to the 2006 act, and one or two proposals are being made to tighten provisions and clarify points of confusion.

I welcome the publication of the committee’s report and the opportunity to debate it. I will cover just a few points. One privilege of an MSP’s job is giving school pupils or students who take a keen interest in politics the chance to experience work in a parliamentary office. As the consultation document noted, the definition of gifts in the 2006 act does not exempt the value of the time of volunteers who work in parliamentary and constituency offices. As the report states, some members might not register volunteer support under gifts, because of the exemption under the sponsorship category. It is desirable to clarify that situation, so I am glad that a revision to the schedule is proposed.

As Nanette Milne said, letters often come our way from the likes of Ipsos MORI and ComRes asking us to participate in quite large surveys, for which the pay-off is that we can direct the polling organisations to make donations to local charitable causes. Like most members, I have done such surveys and asked for donations to be made to the likes of the Royal Air Forces Association and common good funds. As arrangements stand, a fee that is paid to a charity in return for completing a survey is still classed as remuneration, although members have no personal benefit.

I agree with the committee’s view that the registration of interests, particularly in relation to remuneration, is intended to focus on significant interests that might be perceived to influence a member’s behaviour. That is without question in the public interest. I also agree with the committee that it is difficult to state that a member could be unduly influenced by directing a small donation to a charity for completing a survey. I question whether constituents really care whether I have participated in a survey and asked that a donation be paid to a local charity. That is why I welcome the proposed changes to focus the remuneration category on relevant and non-trivial interests.

As I mentioned, many of the proposals are just general housekeeping of the schedule. We see that in the restructuring of the number of categories in the schedule from eight to five. As I highlighted, the amended definitions to categories such as remuneration and gifts are welcome, so I am happy to lend my support to the implementation of the proposed changes.

Photo of Peter Peacock Peter Peacock Labour

I, too, will make some brief remarks—with an emphasis on the word “brief”—on the Standards, Procedures and Public Appointments Committee’s ninth report, which proposes changes to the code of conduct and the schedule to the 2006 act. The changes are set out in today’s Business Bulletin and have been outlined clearly by the convener, with emphases added by Nanette Milne and Jim Hume.

It is obviously vital that we have a code of conduct and a regime for declaring interests that command the respect of the public at large. That requires the scheme to be transparent and, as the convener indicated, to capture significant financial interests. It is the basis for maintaining the highest of standards among members, and therefore the trust of the people, and it is the basis of the accountability of members in these matters.

It is also important in aiding transparency and accountability that the scheme that is produced should be in the simplest form possible. That aids public understanding of what is required of us as individual members and of the scheme as a whole. It is also important for members that the scheme is set out in as straightforward a way as possible, so that we do not make errors as a result of any complexity. In that context, it is important to keep reviewing how the scheme is working in practice in light of previous changes. As other members said, the report reflects the outcome of the review process. We should not be frightened of changing what we have established in the past if, on the basis of experience, we deem it not to be working in the interests of the characteristics that are required of the scheme.

As the convener, Nanette Milne and Jim Hume have said, the report sets out a range of small but nonetheless significant changes to the regime. Like Nanette Milne and Jim Hume, I am pleased that we are removing the rather silly anomaly whereby members who filled out a questionnaire or survey—sometimes taking a considerable time to do so—in order to give a donation to a charity had to declare the resulting donation as if it were remuneration, even though they never saw the money and it was directed to a charity. I am pleased that that anomaly is going and that the situation has been clarified. The matter has been a considerable irritation to members down the years.

Jim Hume properly mentioned another anomaly: volunteering. If someone gave their time freely to support a cause that they thought important and to make a contribution to the community and they did so by volunteering through the political process, the member had to declare that as if it were a gift. If someone gives their time as part of their employment and it is sponsored in some way, I agree that that should be declared. However, if they give their time in the strong tradition of volunteering that we want to encourage in the Parliament, it is wrong that that has to be declared, so I am glad that that anomaly is being tidied up.

We are also ending the double registration of election expenses, which is unnecessary as such expenses are covered by a separate piece of legislation. Why should we be required to register election expenses twice, which surely only helps to confuse the public? Members have to report to the Electoral Commission under a separate law on the matter. The public will rightly be referred from the Parliament website to the website of the Electoral Commission and, in that way, will get a complete picture of members’ interests.

The report also refers to the Scotland Bill and the further changes to the regime that it will introduce. That bill is being scrutinised and deliberated on elsewhere, but the pattern of change has been approved by the Parliament.

This is a balanced and sensible package of refinements to the scheme. As the convener rightly said, the Scottish Parliamentary Standards Commissioner, who is the guardian of the public interest in these matters, is happy with the changes. I am happy to support them and I hope that the Parliament will do so at 5 o’clock.

Photo of Marilyn Livingstone Marilyn Livingstone Labour

As deputy convener of the Standards, Procedures and Public Appointments Committee, I am pleased to contribute to this afternoon’s debate. I echo the convener’s endorsement of the committee’s proposals. The recommendations will ensure both that there is a simplified system and that the transparency and accountability to which Peter Peacock alluded is maintained, which is important.

As we have heard, there will now be five categories of registrable interests instead of eight. Hopefully, that will eliminate overlap; it will certainly reduce it. The changes will make the system more user friendly for members and will make clearer what they have to register and where. That is all the more crucial, as new members will enter the Parliament following the election in May.

The point of the register is to register significant financial interests that are likely to influence, or are likely be perceived as influencing, a member in carrying out their role as an MSP. The changes ensure that the register of interests is clearly focused on interests that need to meet that test, not on a host of minor interests that are not realistically likely to be seen as influencing a member’s behaviour.

The committee kept the principles that underpin the registration process in mind throughout the inquiry. It spent a lot of time deliberating on where, for example, exemptions from registration were and were not appropriate, and on considering what the appropriate financial thresholds for registration in different categories should be.

As Peter Peacock, the convener and others have mentioned, having two different regimes for registering election expenses is confusing and unclear to members and everyone else. The requirements for registering political donations and election expenses have been set by the UK Parliament, taking account of the public interest. The Electoral Commission and returning officers have responsibility for managing the system, so it makes sense that they should also be responsible for publishing that information.

We do not expect the changes to lead to a reduction in the number of interests that are registered. However, the new categories will clarify and simplify matters so that a particular interest can be registered in only one category, regardless of the individual circumstances. Like the convener, I thank the Scottish Parliamentary Standards Commissioner for his valuable advice and input to the committee’s work. I also thank the committee clerks, who have provided invaluable support not just in this area but throughout my time as deputy convener; our legal team; the convener, for the work that he has done; and my committee colleagues.

The Standards, Procedures and Public Appointments Committee may not appear to be the most interesting of committees, but it is to us. The committee plays a crucial role in ensuring that the standards of the Parliament are maintained and that procedures are kept up to date and reflect changes. I thank all those who have helped us.

I support the motions in the convener’s name.