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Opposition Parties (Financial Assistance)

Volume 990: debated on Thursday 7 August 1980

The text on this page has been created from Hansard archive content, it may contain typographical errors.

I inform the House that there is an error in the motion on financial assistance to Opposition parties and in the amendment in the name of the hon. Member for Sudbury and Woodbridge (Mr. Stainton). The figure reading "£1,925" should read "£1·925".

The Chancellor of the Duchy of Lancaster and Leader of the House of Commons
(Mr. Norman St. John-Stevas)

There appears also to be a misprint in the Government motion.

I am sorry if I did not make that clear. The error is in the Government motion, and it is repeated in the amendment.

10.45 pm

I did not wish to be party to a resolution giving £1,925 for every 200 votes. I am well disposed to the Opposition, but not that well disposed.

I beg to move,
That the Resolution of the House of 20 March 1975 shall have effect from 1 July 1980 with the substitution of the following paragraph for paragraph 2 of that Resolution:—
'That for the purpose of determining the annual maxima of such assistance the following formula shall apply:
£962·50 for each seat won by the party concerned plus £1·925 for every 200 votes cast for it at the preceding General Election, provided that the maximum payable to any party shall not exceed £290,000.
The effect of the motion is to increase the amounts of financial assistance payable to Opposition parties to assist them in carrying out their parliamentary business. At present the amounts payable are £550 for each seat won by the party at the last general election, plus £1·10 for every 200 votes that it received. In order to qualify, a party must have at least two Members elected to the House as members of that party at the preceding general election, or have one such Member and have received at least 150,000 votes at that election. There is at present a maximum party entitlement of £165,000.

If the House approves the motion, the amounts payable under the formula will be increased by 75 per cent. to £962·50 for each seat and £1·925 for every 200 votes. The maximum amount payable to any party will also be increased to £290,000.

The scheme was first introduced in 1975, when the formula was fixed on the basis of £500 for each seat won by the party plus £1 for every 200 votes. These amounts have previously been increased from their original level only once—by 10 per cent. in February 1978.

I must stress that the purpose of the scheme is to assist Opposition parties in carrying out their work at Westminster. The use of this financial assistance is therefore confined by the original resolution to paying for expenses incurred in relation to a party's parliamentary business. Subject to this limitation, its allocation is at the party's discretion. I understand, however, that the bulk of the money goes towards research and secretarial assistance and in staffing the Whips' offices.

In practical terms, the leader of the Opposition party, or a person deputed by him, makes his quarterly claim to the Accountant of the House, who makes out a cheque in accordance with his instructions. If the party concerned wished the amount payable to be made over in some other way, that could be done, provided that the way in which the money was to be spent could be properly certified as being within the terms of the 1975 resolution—that the expenses had been
"incurred exclusively in relation to that party's Parliamentary business".—[Official Report, 20 March 1975; Vol. 888, c. 1934.]
I must stress that this has nothing in common with propositions for helping parties with their activities outside Westminster.

Obviously, like all other administrative and office expenses, the costs of the support services that this assistance is designed to meet have risen sharply in recent years. The proposed increase will help to meet these increased costs, which are inevitable if the Opposition parties are to carry out their parliamentary duties. Our constitution has long recognised the position of the Leader of the Opposition as part of the parliamentary constitution, to the extent that he is paid an official salary.

I need add only that the scheme and the proposed addition to the amounts payable in no way represent any change in the Government's position with regard to the provision of public finance for the general activities of political parties or towards the recommendations made in the Houghton committee's report in 1976. The Government have made it clear, and we make it clear again tonight, that we have no proposals to extend financial assistance to political parties in that way. The proposal is accordingly no more than an updating of existing provisions in the light of increased costs since the amounts payable under the scheme were last fixed.

10.50 pm

As the Leader of the House said in moving the motion, the Government are extending the facility first presented to the House in 1975 by the then Labour Government to take account of some degree of inflation since then.

When it was put forward in 1975, this proposal, while not commanding 100 per cent. support in the House, commanded the support of all parties in the House. That went, too, for the increase in the scales that was adopted in 1978 and put forward by the Labour Government at that time.

It is now well over two years since the increase was effective in 1978, and it is therefore time for an increase to be made once again. Coming to the figures, it should be noted that the revised figures in the motion do not take account of the degree of inflation that has taken place since I January 1975, when the facility first began.

If we took account of inflation since I January 1975 and then took as one of the main figures the maximum figure that any party might receive, it would have to be about £330,000, whereas the motion provides for a maximum figure of only £290,000. That ratio is reflected in the other figures in the motion.

We are saying that the real value of this assistance, compared with what was decided by the House in 1975 and effective from the beginning of that year, will not be similar to what we decided at that time but will be between 95 per cent. and 87 per cent. of the real value of what was decided then.

Therefore, there is a real fall of about 12 per cent. or 13 per cent. in the value of this assistance. Since, as the Leader of the House said, most of that money, irrespective of which party is using it, is expended upon salaries, the real value of it is even less than the figure that I have just stated, because the rise in salaries has been greater than the rise in general inflation.

I make two points to the Leader of the House on an obscurity in the motion. I am sure that we are all clear about what is intended, but there is an obscurity that in the future we should do something to clear up. It is not absolutely clear from the terms of the motion that the maximum for the present year. 1980, is to be made up of one half-year at the rate—if I may put it like this—of £165,000 maximum and one half-year at the rate of £290,000 maximum. I take it that it is the intention that the maximum this year will be composed of the two halves—half of the old rate and half of the new rate.

Secondly—and this problem has occurred in the past—there is the situation that can occur, and did occur in the last Parliament, where a party breaks up after an election. In the terms of the motion that we passed in 1975, we did not address ourselves to that difficulty. It occurred in the last Parliament. I mention it because it is a problem that has cropped up. No solution to it was available in terms of the motion that we passed, and, since the terms we adopt in the case of a resolution of the House are usually less carefully drafted than in the case of legislation, it is something to which we should address ourselves. That is not to say that the Labour Party would have any interest in that point. I raise it only in relation to the party that had that problem several years ago.

As the Leader of the House said, this money is available only in connection with an Opposition party's parliamentary duties and not for its work outside the House. It should be noted that in the use of these funds the party is answerable, like the users of all public funds, to the Public Accounts Committee, which could, if it wished, investigate the use of these funds to satisfy itself that they were being used for the purposes covered by the resolution.

When the predecessor motion was going through the House in 1975, the right hon. Member for Yeovil (Mr. Peyton), the then Conservative Opposition spokesman, pointed out very firmly that one of his colleagues, who was concerned about the proposal, was
"wrong in discerning a new principle".
He pointed out that what was being done was to extend a principle that had already been adopted of extending assistance from public funds to the Opposition and making that accord more with the needs of modern times. He referred to it in 1975, when it was a newer idea, as
"this modest little proposal".
The right hon. Gentleman argued that
"the means of support available to the Opposition have dwindled steadily as against the steady and, to my mind, loathsome growth in the power of the Government",
and that
"We must have some means of redressing the balance."—[Official Report, 20 March 1975; Vol. 888, c. 1920–22.]
That thought was repeated by the right hon. Member for Cambridgeshire (Mr, Pym), who is now Secretary of State for Defence, when, supporting the increase in the funds in 1978, he said:
"After nearly three years, it is reasonable in all the circumstances to propose this very modest increase. Plainly it will leave the Opposition parties much worse off in real terms than they were then."—[Official Report, 13 February 1980; Vol. 944, c. 199.]
He was referring to the time when the facility was first introduced, at the beginning of 1975.

That once again is the situation. We are in exactly the situation that was approved by the Conservative Party in 1975 and approved by the Conservative Party in 1978. It is time to make this modest increase, which does not take full account of inflation, and I hope that, in the interests of the proper working of the House, the House will give support to the motion that the Government have introduced.

10.57 pm

I am unhappy at this proposal, for a number of reasons. I cannot imagine that the proposal that Opposition parties should receive money from the taxpayer and that they should have removed from them the responsibility of raising their own money through the persuasiveness of their representatives in the country would ever have been introduced had it not come about that in 1975, when the Labour Party was in power and it realised that the Labour majority was likely to totter, one of the agreements that was struck with minority parties for their support at a time of voting difficulty was to give financial support to the minority parties for the assistance that had been forthcoming.

Until 1975, the House had gone along for hundreds of years without providing taxpayers' money for the parties. One of the ways in which the Labour Party was allowed to maintain its strength, although it was clearly in difficulties when raising finance, was to allow the substitution of contracting out for the contracting in of trade union levies.

I can recall many Conservative Party conferences at which Conservative Party supporters expressed their puzzlement at the way in which we continued to allow the trade unions to raise money for the support of the Labour Party although trade unions are in essence not meant to be political parties. The only reasonable answer was that if the contracting-in proposal was substituted for contracting out, so little money would be raised for the Labour Party that it would have great difficulty in maintaining a viable Opposition.

That was the concession that Parliament and Conservative Governments made for Opposition parties that were in substantial difficulties. As long as that concession remains, it seems wrong that the taxpayer should continue increasing the contribution to minority parties.

There is no reason why any concession should be made to minority parties for the purpose of keeping the present Government in power. One has to concede the logic and the sense of the taxpayer providing support for the Leader of the Opposition because his is a constitutional position in our political life. To go beyond that support is an excess that is not necessary for Parliament to provide. My right hon. Friend, in moving the motion, said that the contribution was restricted to the use of parliamentary facilities and did not go towards sponsoring political parties outside this place. The reality is that the less money a political party needs to spend on the running of its offices in this place the more money it has available to spend on the running of its activities outside this place. It is not a sufficient answer to the criticisms that some of us feel to say that this matter is restricted to the activities of the House.

The matter does not stop there. In 1975, the facilities provided for research and secretarial assistance were nothing like the generous facilities that we have now decided to provide for our secretaries and research assistants. In that regard, the State contributes more money to all parties than ever before. The matter that gives me greatest cause for concern is the fact that we propose to increase the contribution to minority parties at a time when we are asking the nation to undergo a period of considerable economic restraint.

I notice that Opposition Members below the Gangway have thought it consistent with their party's approach, when in Opposition, to attack the Government at every stage for every cutback in public expenditure. Yet the Government have reached the end of their first year successfully, I believe most people in the country would say, in terms of their manifesto. The Government have made a substantial contribution towards the fulfilment of the manifesto. About 60 per cent. of our promises—

It rises higher. That has been achieved in the face of substantial opposition—from among our own ranks apart from others—to the cutbacks in public expenditure. People in the country will be puzzled, so strong has been the Government's attitude towards restricting the rise of inflation, to read that we should be voting at this late hour and at this late day in this Parliament—when many hon. Members have still not recovered from two nights, or certainly one night, of irresponsible opposition—an increase of pay to Opposition parties in this fashion. It is inconsistent with the spirit in which the Government have conducted their approach to the manifesto.

It is all very well to say that this power was given in 1975. We have an entirely new Parliament. I regret that an opportunity has not been given to the full House, at a time when all hon. Members are present and not laid low by the acti- vities of the past week, to consider whether it still supports the substantial change in the constitutional position of Opposition parties in the House.

For all those reasons—I do not seek to detain the House with a long argument—this is contrary to the traditional principle. It is unnecessary as a means of encouraging minority parties to raise their own funds, it is unnecessary in the light of the contracting-out provisions of the trade union legislation, and it will not look well when people read tomorrow that we have approved an increase in the expenditure of minority parties.

11.5 pm

We should get this matter into context. It is interesting to consider why this money was voted in the first place. It was originally known as Short money. The then Leader of the House—now Lord Glenamara—introduced the idea that Opposition parties should get some subvention from the taxpayer.

Why should there be a subvention from the taxpayer? When a party is in Government, it has the resources of the Civil Service behind it free, but the party in Opposition has to do its own briefing and devilling and produce its own researches. It was right that in 1975 a certain amount of money should be allocated to the Opposition parties. I do not propose to deal with the minority parties. I shall talk about the two major parties, with no disrespect to other parties in the House,.

It is obvious that the concept of giving the Opposition the opportunity and the wherewithal to carry out certain functions is right. With respect to my hon. Friend the Member for Burton (Mr. Lawrence), this has nothing to do with the running of voluntary parties. At one time, voluntary parties paid not only the whole of the Whips' office but the whole of the postage. Indeed, Members of Parliament paid the whole of their postage. Since then it has been felt that Members of Parliament cannot do their job properly unless they get certain facilities. Over the years, apart from the increase in salary that we might have had, we have been given free postage, a secretarial allowance, a research group allowance and a living-in-London allowance.

Let us ally that to the Leader of the Opposition. I point out that the Leader of the Opposition is a Crown appointment. If it is thought right that the Leader of the Opposition should be a Crown appointment, of course he should have the back-up staff to enable him to carry out his responsibilities. It is nothing to do with running the political party.

In the past I had something to do with Central Office. I assure hon. Members that the running of the Leader of the Opposition's office was quite a task. I do not know how many letters the Leader of the Opposition gets today—I am not talking about whether the party has done well—but on a topical issue he can receive 400. 500 or 600 letters a day. How can the Leader of the Opposition, with one salary and without back-up staff, answer all those letters?

In addition to the Leader of the Opposition, Shadow spokesmen need to be briefed. That means having a tremendous number of research staff. I assure the House that when this scheme started and the Conservative Party was receiving £150,000 a year, in no way did that cover the whole cost of the Leader of the Opposition's office. I agree that it was a contribution to it.

My hon. Friend the Member for Burton raised the red herring of the Houghton committee. I do not agree with the Houghton report. I remind my hon. Friend and other hon. Members that the Conservative Party gave evidence to the Houghton committee against taxpayers' money being spent on political parties in the country. I emphasise the words "in the country" because there is a difference between running a party in this House and running a party in the country. If a party in the country does not have the support of the voters in the country, it will not receive the subscriptions. If the party in the country could not raise sufficient funds to run that party, it might mean that its policy was not in tune with what the public wanted. But that is an entirely different matter from running a party in the House.

I am told that it is essential for me, as a Member of Parliament to have a secretary and a research assistant. The allowances for such assistance have been updated over the years. If it is essential for me to have a back-up staff, surely it is essential for the Leader of the Opposition to have a back-up staff. If we say that the Leader of the Opposition should not receive this money, we should take away the allowances for secretarial and research assistance for Back Bench Members of Parliament.

I hope that we do not fall into the trap of thinking that the sum of £290,000 —all parties have accepted the principle of a subvention payment for running the office of the Leader of the Opposition—is right. The hon. Member for Islington, South and Finsbury (Mr. Cunningham) suggested that it should be £330,000. I think it should be slightly more. The principle has not changed—

Does not my hon. Friend accept that some of the allowances and some of the recent awards made to Members of Parliament were contested by some hon. Members as being too high? Is he not making an argument for the inflationary increases that we have said cannot be sustained at our present production rates?

I think my hon. Friend will agree that my record shows that I am not in favour of increasing public expenditure. I accept the fact that some hon. Members resisted the increases for secretarial and research allowances. But we must remember that in the two-party system that we operate in this country the leader of any Opposition party is always in a more difficult position than the Prime Minister and Ministers simply because they have the whole weight of the Civil Service behind them. With respect to my hon. Friend, this matter is not in the same context as that of whether some hon. Members thought that we should not increase secretarial and research allowances. I do not think that many hon. Members would say that those allowances should be abolished.

One accepts the premise that it is essential for the Leader of the Opposition's office to be serviced. However, the £290,000 on offer at present will in no way pay the whole of the expenses of that office. I note that the Shadow Leader of the House nods in agreement. Any sensible person must know that this is so, bearing in mind the number of secretaries, researchers and so on that the Leader of the Opposition needs.

I hope that none of my hon. Friends will resist the motion, for the simple reason that it is fair. If the allowance were rising to £500,000, I would be on the same side as some of my hon. Friends. If it is being increased by only about 82 per cent. of the inflation rate, that is right.

Two things occur to me. First, I believe that my hon. Friend has obscured his argument by referring to the secretarial and other allowances that Members of Parliament get in the same breath as referring to an allowance that we are now discussing in terms of political parties and their activities here. They are totally different things. We as Members receive an allowance—we can argue whether it is too much or too little—to service our constituents on a non-party political basis.

The terms of this proposal are that a political party or two political parties—however it may turn out—receive money from the State in order to oppose the Government. If that is so, it will only perpetuate in the minds of the electorate who elect us the feeling that there is an alliance between the establishments of both main parties so that, whoever's turn it is, it is Buggins's turn. I do not believe that the electorate believe that this is real.

I take my hon. Friend's point, but I think that he is barking up the wrong tree, because there will be a loss on the £290,000. It will go towards paying for the secretaries and the research that the Leader of the Opposition must carry out, and it will not in any case be used for the propagation of party philosophy. Party philosophy is not necessarily a question of cash. Opposition Members propagate the philosophy of whatever they believe in. Conservative Members do exactly the same.

There are many people who write to the present Leader of the Opposition but who probably vote for me or for my hon. Friend. There is no party point in it, but those letters must be answered by someone.

Let us not get this matter out of context. I am delighted that the Conservative Party is in Government. I hope that it will be in Government for many years, although I know that that will not go down well in all parts of the House. But we must ensure that no party that is in Government, with the whole weight of the Civil Service behind it, should be in a position to squash an Opposition. We must see that the Opposition have some resources in order to fight whichever Government are in office.

I have tried to give the history of this matter and to put it into context and take it out of the business of parties. It has nothing to do with parties. This concerns running an office which, I repeat, is a Crown appointment. As a Member of Parliament, I am paid by the taxpayer. The Leader of the Opposition is also paid by the taxpayer. As a Member of Parliament, I get certain allowances for secretarial services and so on. Those allowances are updated now and again. The Leader of the Opposition has far more responsibility than I or any other Back Bench Member. His office should be serviced sufficiently without the need for subsidies. The £290,000 will not pay all the Leader of the Oppositions expenses, no matter which party he comes from.

I hope that my hon. Friends will not resist this measure. The Conservative Party has accepted the principle and precedent. The Government are only updating the provision. The full effect of inflation has not been taken into account. I should have thought that this was a very reasonable proposition.

11.20 pm

I do not wish to detain the House for more than a few minutes. I hope that my hon. Friend the Member for Croydon, South (Sir W. Clark) will not misunderstand me when I say that for the first time I have listened to a speech from him that might almost have been made from my notes. It was a new experience for me, and I very much enjoyed it.

My hon. Friend was right to concentrate on the key issue, namely, the type of democracy that we want. When the Government present measures and arguments, they are supported by the massive resources of the Civil Service. Whether one is a Back Bencher or an Opposition Front Bench Member, one does not have access to the same amount of support.

I should like to put my right hon. Friend's proposal and the principle of giving State funds to the Opposition Front Benches—which the House accepted in 1975—into the context of the series of measures that have been proposed during the past 15 years. Such measures have tried to right the balance between a Government Front Bench that is generously supported by the Civil Service and other hon. Members who are less generously supported.

Select Committees were set up to provide new ways of eliciting information from the Civil Service. They gave Back Bench Members a new basis from which to strengthen control over the Executive. In a way, that is part of the same process—in which my right hon. Friend played a notable part—of improving our control and influence over the Executive. Like the measures before us tonight, the Select Committees helped to strengthen Parliament.

My hon. Friend the Member for Croydon, South was right to point out that giving funds to the official Opposition party would emphasise the importance of the role of that institution in our two-party system. Its role is vital if we are to continue to produce the parliamentary compromises that are the stuff of the British constitution. We are often told that the great strength of our system is that an alternative Government are ready to take office after a general election without having to form a coalition or go through a formative phase. That would not be a strength if the party was unable to do the research necessary to build up its programme and to formulate policies.

If we provide Opposition parties with funds during the Session we shall be buying a public good. That public good is that Opposition parties will be well informed and will have the means necessary to establish their case. They will then be able to base their cases on fact rather than on mythology. That will be a public good, and it will be rightly paid for from the public purse.

11.24 pm

Nothing that has been said by my hon. Friend the Member for Loughborough (Mr. Dorrell) distinguishes between the justification for paying money to the office of the Leader of the Opposition and that for paying money to political parties in general. He seems to think that democracy can be assisted and strengthened by the provision of public money for the activities of political parties. I suggest that if he thinks a lot more about this he will realise that he is treading on very dangerous ground.

I now refer to what my hon. Friend the Member for Croydon, South (Sir W. Clark) said. We are not talking about money being provided for the office of the Leader of the Opposition. If we were, and if it were expressed as such, perhaps an argument could be made for saying that this was a special fund which applied only to this purpose. That was the brunt of my hon. Friend's argument. I understand that there may be something to be said about that. There is a precedent that a stipend is now paid to the Leader of the Opposition. However, the resources of the office of the Leader of the Opposition are drawn from the party that he represents in the House. Indeed, it is said that what is paid is not enough, and so he has to be subsidised in his activities by his party.

The argument of my hon. Friend the Member for Burton (Mr. Lawrence), as I understand it, is that in principle this cannot be justified and that in a healthy democracy a political party should be able to provide all the funds that are necessary to carry on those activities. The problem here is one of attitude.

I believe that the hon. Member for Tottenham (Mr. Atkinson) is the treasurer of the Labour Party. Did he not recently publicly ask the leader of the Labour Party to arrange that the money paid from this fund should go to him and that he should be responsible for its disbursement to the Labour Party as a whole? The hon. Gentleman will correct me if I am wrong, but I understand that to be his view. If that is his view, quite clearly he, as the national treasurer of the British Labour Party, believes that that money should be paid for the purposes of the Labour Party. That, no doubt, is the argument. If so, it completely contradicts the argument of my hon. Friend the Member for Burton.

My hon. Friend the Member for Tottenham (Mr. Atkinson) is entitled to express that opinion, but he does not speak for the rest of the Parliamentary Labour Party.

I fully appreciate that. I have some sympathy with that point of view. The fact is that the hon. Member for Tottenham is the national treasurer of the Labour Party. As I understand it, he has been elected to that post by the Labour Party, by whichever form of democracy in which it indulges. It seems to follow, as at present advised, that it is the view of the national authority of the Labour Party that the money should be paid to that source.

If we had an undertaking from the Opposition or the Labour Party that in future all the money would be paid to the Leader of the Opposition personally or in some form that ensured that it stayed within the office of the Leader of the Opposition, I concede that there would be an argument. Even so, I do not agree with it, as in principle we should not use taxpayers' money to benefit political parties.

My hon. Friend the Member for Burton was wrong continually to emphasise that money was being paid to minority Opposition parties. That is not the point. The money is being paid to political parties. Should political parties in a democracy—whatever kinds of parties they are—be subsidised with public money? We are not talking only about the Labour Party. The members of the Liberal Party find it difficult to raise money, as, no doubt, do the others. However, the real argument concerns the Labour Party. From the time of its origins, it has never persuaded itself to go to the doorsteps to raise money from small subscriptions, jumble sales, coffee mornings, and all the 1,001 activities by which money is raised for political parties in a democracy.

That is the healthy way in a political democracy such as ours. That is the way in which the Labour Party should raise its funds, instead of attempting to resolve its difficulties by going to the taxpayer cap in hand and saying "We cannot carry on our party organisation without a subsidy from public funds—without help from you. It does not matter that you do not happen to support our party. You have to pay because we have arranged it that the law says that money should be paid by Parliament itself."

That attitude is completely wrong. The Labour Party's attitude should be that of bringing itself up to date and running and financing its organisation in the modern, practical, healthy, democratic way, which is the way followed by the Conservative Party.

If the logic of that argument is followed to its conclusion, is it not wrong consequently to give a Back Bench Member of Parliament a secretarial allowance? Why not take that away?

I take that point from my hon. Friend. I am rather surprised that he should go on emphasising this. There is all the difference in the world between assisting an individual Member of Parliament, no matter what his party, to represent all his constituents and do a more effective job, enabling him to spend more time on the interests of his constituents, and providing money to a political party.

This has nothing to do with assistance that may be given to individual Members of Parliament to enable them to do their jobs more effectively. It is not done in the context of political organisation. It is not given to them because they happen to be Conservative, Labour, Liberal or supporters of any other political party. It is given because they as individuals want to do their best for all their constituents.

I do not believe in the theory that a Conservative Member represents only the Conservatives in his constituency. If he does, he is a rotten Member of Parliament. But that is said constantly, especially by the Liberals, because, of course, every Liberal Member does his best for all his constituents. Let us get away from that silly nonsense. Every hon. Member tries to represent all his constituents, and it is perfectly proper that he should be assisted financially in this way, not only by his salary but by the provision of services.

That is a completely different argument in principle from what my hon. Friend the Member for Croydon, South has been saying, which is that the political organisation to which an hon. Member belongs should be enabled to become more efficient by being paid money not through individual Members of Parliament but direct to party funds.

I suggest that if my hon. Friend really believes that the equivalent of this money should be paid as allowances to individual Members we should say that within each party every individual Member of Parliament should pay a percentage of what he is paid by way of salary to his party.

That is not my point. My argument is that if money is provided to an hon. Member to do his parliamentary job, it is from that fund that it would be quite appropriate for the money to go to that parliamentary job being done by his political organisation. What an individual Member may earn outside this place has nothing to do with this argument. The argument is how to use public money in this respect.

When we talk about public money in this context, we must define the objective that we have in mind. I suggest that the only objective must be that of improving the efficiency and quality of the service given by each Member of Parliament. That argument is wholly unrelated to the argument behind speeches made in favour of this propostion, namely, that taxpayers should be brought in when a party is so inefficient that it cannot even raise enough money to run its own leader's office and that the taxpayers should make up the difference.

There are many respects in which money is needed in party organisations. The Labour Party, for example, does not have nearly enough full-time salaried agents. The question is how the money for them is to be raised. One thing to be said for the national organisation of the Conservative Party is that, by and large, we manage to raise enough money to pay for our own organisation.

An Opposition party does not have to take the money if it does not want to. Why did the Conservative Party take it in 1975?

I was unfortunate in being a Back Bencher and, therefore, was not at all responsible for the decision that was taken. It was a mistake in 1975, and I said so at the time, so I cannot be accused of inconsistency.

Will my hon. Friend consider the suggestion that perhaps with the new research assistant allowances, or the increase in the secretarial allowance that is supposed to cover the research allowance as well, Members who so wished could contribute to a communal fund in their party so that research could be undertaken on a party basis and, no doubt, cover all the wonderful things of which my hon. Friend the Member for Croydon, South (Sir W. Clark) spoke?

I am obliged to my hon. Friend, because that was the point that I was trying to make. If individual Members of Parliament want to improve their efficiency in this place as a whole, it is for them to provide for that better organisation out of the remuneration they are paid from public funds—in other words, by some sort of levy.

My main point is that we could provide a far better service to the people of this country if only we as political parties concentrated on improving our efficiency. That means that the Labour Party must get over its problems. It has relied for so long on trade union funds that it has never got into the habit of getting on to the doorsteps and raising money in small amounts.

No doubt individual constituencies and individual Members of this place do that to some extent, but there is no doubt that the overwhelming majority of Labour Party funds comes from huge corporate subscriptions from the trade unions. It used to be alleged by the Labour Party that the Conservative Party raised its funds for the most part by donations from big business. That was an interesting thought, until gradually one got information about these matters. Nowadays it has been discovered that the opposite is true and that the majority comes from individual subscriptions.

My own constituency is a good example of how things should be done. My Conservative association raises £14,000 per annum, through individual annual subscriptions and through many hundreds of small fund-raising events, such as coffee mornings, jumble sales and garden parties. From that sum my association is able to pay £2,000 to Central Office for its needs, and yet at the same time it pays a full-time agent a salary of £4,000 or £5,000 and carries on all its other activities. That is done only by harnessing the energies of about 7,000 or 8,000 members of the association. I wonder how many Labour Members have that sort of membership in their party organisations. That is the democratic and effective way of raising funds.

It is quite unwise to allow any hon. Member, on either side, to make such mistakes as the hon. Gentleman is making. I have been close to a county constituency party for many years, as its secretary, and I assure him that not one penny of the assistance that we are discussing goes to constituency or local parties. That is a fact.

I am obliged to the hon. Gentleman, but I never suggested that. What is being suggested is that the money that we are discussing goes to a particular need within the Labour Party—namely, if we accept what my hon. Friend the Member for Croydon, South said, to the office of the Leader of the Opposition. If that is so, none of that money goes to the purpose of the party as a whole.

I do not think my hon. Friend realises that a certificate has to be signed each quarter stating that a certain amount of money has been expended for the direct expenditure of the Leader of the Opposition. It is a red herring to say that some of this money could be used for national party politics. We must get our facts right before we try to distort them.

That is fine, because my hon. Friend is giving a perfect example of the sort of tactic that accuses someone of saying something he never said and then says how wrong he must have been. I have never suggested anything to the effect that my hon. Friend has criticised me for.

In principle, the services of the Leaders of the Opposition should be met by revenue raised by the party as a whole. I was not suggesting that money raised for the Leader of the Opposition goes to the constituency parties. My argument was that the Labour Party relies too much on institutional financing from the trade unions—a sort of block financing. It would be far healthier and far more democratic if the Labour Party as a whole drew its funds from sources like the many that the Conservative Party fortunately is able to use.

Would my hon. Friend care to consider the system that we have in the Conservative Party? For the most part, the constituency associations have a quota, which they are expected to pay to Central Office to assist with its management. When my right hon. Friend the Prime Minister was Leader of the Opposition, presumably as many letters were sent to her in her capacity as leader of the Conservative Party as in her capacity as Leader of the Opposition, and those letters went to Central Office. Would it not be reasonable to expect party headquarters to provide a sum of money from voluntary funds to assist the Leader of the Opposition—Conservative or Labour—deriving those funds from the individual subscriptions and contributions, which I know my hon. Friends are expected to pay to their associations?

I accept that point, which is of great assistance to me in my simple argument that political parties should be responsible for raising their own funds and for applying those funds to all their purposes, not merely in the country as a whole but also in the House. If it were suggested that we need more money to do our jobs as individuals, I would say "Fine, we are paid to do that job." Each hon. Member is paid to do his job, just as the Leader of the Opposition is paid to do his job. Surely, if the Leader of the Opposition needs more money it should come from the same source—from the individuals in the party organisation.

If the Labour Party wants to provide more funds to the Leader of the Opposition, let it do so. I simply do not understand the argument in principle, and I am surprised that so many Conservatives should find that there is any merit in it.

Could my hon. Friend give us the benefit of his legal training and help a simple man like me to understand the argument that in some way sums that are made available to the parliamentary party—the official Opposition—are not being used for party political purposes? Surely, if that money were not made available the funds would have to come from the political party in the country. If it is relieved of that liability, surely it must be the case that the funds are, at least indirectly, being used for party political purposes.

I accept that point, too. It is sad for me, believing as I do in parliamentary democracy, to realise that the Labour Party is so wrong about this matter and is depriving itself of the strength and moral justification that could be derived from obtaining its revenue from individual members. The Labour Party gets so much in funds from great institutions, such as the trade unions, yet now, when extra support is needed for the party in this place, it does not go back to the party organisation and tell its supporters to get out on to the doorsteps and ask for more money. It says that the taxpayer must pay up.

This was the argument put forward in 1975, and I am very sorry that the leaders of my party at that time saw fit to accept it. One of the strong arguments put by Conservatives at that time was that we had to go along with this because it was in the interests of the other parties. There was the suggestion that it would not be fair for the Conservative Party to object to this system because, after all, the poor Labour Party, which is not as efficient as the Conservative Party at raising money, would suffer.

The fact is that the Labour Party must go back to square one and begin raising its money in a democratic way through the individual subscriptions of the many thousand members that it could have. There is a fiction that every local party that has 1,000 members affiliates with the Labour Party, but many affiliate anyway, even though they do not have the requisite number of members. I am pretty sure that the local party in my constituency does not have 1,000 members, and yet it is affiliated. Surely, the Labour Party should decide to raise this money properly and honestly instead of calling on the taxpayer. It should decide to be independent and rely on its members. In that way not only would it get more members; it would be happier, healthier and bigger, and it might even win a few more elections.

11.49 pm

I am pleased to be called in this debate in order to discuss the question of financial assistance to Opposition parties. I come to this debate fresh as I am a new Member of this Parliament. I did not have the opportunity to participate in the debate on 20 March 1975. However, I read the reports of it with great interest. I have listened closely tonight to my hon. Friends the Members for Burton (Mr. Lawrence) and Orpington (Mr. Stanbrook). I believe that they have the better of the argument. Having listened to the entire debate, I believe that those who oppose the motion have the better of the argument.

The main reason why I believe that the House should reject the motion was touched on by the hon. Member for Islington, South and Finsbury (Mr. Cunnngham) in supporting it. The motion is not dealing so much with principles, which were debated in March 1975. We are debating uprating the figures to take account of increased costs.

At the beginning of the debate, Mr. Deputy Speaker, you drew our attention to the error. We are talking about £1.925 for every 200 votes. I have not used a slide rule, calculator or abacus to do the calculation, although before the end of the debate we may need an abacus. However, I do not believe that that error would have affected the sums payable to the main Opposition party—namely, £290,000—although it would have affected the sums payable to minority parties, of which there are a number.

It is strange that we should be considering uprating the figures to take account of inflation. I am driven to consider why we have had such high inflation under the previous Government and this one. The sooner the rate of inflation comes down, the better for all of us. Why is inflation so high? Some hon. Gentlemen suggest that it is all the fault of the wicked capitalists and entrepreneurs, who set the price of their goods and services higher than the market can bear. Some would believe—although, I hope, none in my own party now—that in some way trade unionists are responsible for inflation. It seems to me that neither of those groups is responsible for the inflation that is causing the pressure on the figures in the formula. We must look elsewhere for the motive force responsible for the increase in the figures.

There are those in all parties who say that the motive force is the price of oil and that by increasing it the oil sheikhs are pushing up other prices, including the prices of the goods and services on which the Leader of the Opposition and his colleagues are spending their money, to expand their opposition in the House. I shall later dwell on whether the money is well spent. We must examine public expenditure thoroughly, looking not only at the quantity—and I do not believe that to date we have had the figure for the quantity of public money that is to be spent—but at the quality.

I take the silence of the House to be consent—

I am sure that my hon. Friend will support my central point about inflation and will agree with my right hon. Friend the Member for Taunton (Mr. du Cann) that inflation is not caused by wicked capitalists and entrepreneurs or by wicked trade unionists. Neither of those categories is providing the upward force, and nor are oil prices. We cannot look either to the scapegoat of the Government of my right hon. Friend the Member for Sidcup (Mr. Heath) in the early 1970s—that it was something peculiar to do with world food prices.

The cause of inflation, the real motive force responsible for the upping of the figures in the motion, is the very politicians who at one time or another will benefit from the motion. I view that fact with a great deal of concern and suspicion.

If as politicians we can index-link our own error and our own inability to control inflation—the major economic issue of our time, as the Conservative Government rightly see it—and if we can isolate ourselves from the pressures upon us, we shall have less incentive, less of a motive force ourselves, to control the very inflation of which these figures are the outward sign.

My hon. Friend has made a valid point about indexation. The argument has been put forward by both Front Benches that this is almost a technical motion to index according to inflation. Will my hon. Friend consider the position that faces both parties outside the House? From my knowledge of the Conservative Party's finances, I am conscious, at a time of inflation, that the party is subject to inflationary pressures. We have not been able to obtain income by taking advantage of indexing, because we are dependent upon voluntary contributions. I suspect that the Labour Party treasurer will report to the Labour Party conference that inflation has eaten away that party's funds. It is a valid point.

Is my hon. Friend aware that both political parties outside the House, at a time of inflation, have to cut their coat according to their cloth and cannot resort to the magic formula, as the Leader of the House is doing tonight, of indexation in order to solve our problems?

I am thankful for that intervention, particularly because this is the first time that I have followed my hon. Friend in such a debate and because we are the first graduates of the university of York to serve in this House. I have been listening—

Order. The hon. Member for Basildon (Mr. Proctor) must relate his arguments to the motion on the Order Paper. The university he attended has nothing to do with it.

I am sorry if I have tried your patience, Mr. Deputy Speaker, but this was a first opportunity and I thought that it was a polite and courteous reference to the intervention of my hon. Friend. I fully accept the points he made.

However, I turn to the second major reason why it is dangerous—

I shall give way in a moment. I wish to proceed to the second part of my speech.

Are political parties and politicians popular? Political parties, it seems to me, are not the most popular bodies in our society. Therefore, I think that it would be wrong for the State to continue to give even more money to these unpopular creations. On grounds of unpopularity—

In a moment. On those grounds, I would argue that no money should be given to these unpopular and extraordinary beasts in our society.

Before my hon. Friend leaves the issue of inflation, I should like to ask a question. Was it not in February 1978—three years after the original allowances were set—that they were increased, and then by only 10 per cent.? We heard that from the Leader of the House. Twelve months later, under the Labour Government the rate of inflation came down. Would it not be better and more sensible to throw out this measure and rethink this matter in the next Session rather than approve increases of between 75 and 80 per cent.? There is a direct correlation.

It is entirely wrong if we increase the allowances to Opposition parties and gaily increase other allowances and public sector pay. We cannot hope to bring down inflation if we embark on that course. Does my hon. Friend agree that it would be far better not to agree to these vast increases and to think again? Surely, it would be better to let the House have time to consider the issue during the Summer Recess. We can hope to bring down inflation by reducing increases of this sort.

I agree with my hon. Friend. I am interested in his suggestion that any increase of the allowances should preferably be linked with a future general election. I said at the outset that in principle I am against any payment to Opposition parties, whichever parties they may be and however many they may be.

When the debate on this issue took place on 20 March 1975, a distinguished Labour Back Bencher, the hon. Member for Newham, North-West (Mr. Lewis), moved an amendment that was accepted by the Chair. One might say with hindsight that it is unfortunate that I or one of my right hon. or hon. Friends did not consider tabling a similar amendment. The effect of the amendment was that the resolution should take effect after the general election, namely, after October 1974—

Order, It would be quite wrong to go back to a debate that took place some years ago. We are dealing with the motion on the Order Paper.

I am dealing with the motion before us, Mr. Deputy Speaker. I am suggesting that it might be a good idea if the Government, even at this late hour, were to think again about whether they should bring forward the motion. They might consider introducing it after the Summer Recess with a view to its taking effect after the next general election. That would provide our constituents with an opportunity to consider the view of our stance on the propositions that are set out in the motion.

Does my hon. Friend recognise that some of us have voted down the indexation of increases in the allowances of Members of Parliament in various forms? That is what I find obnoxious about the motion. Will he address his remarks to the idea that politicians, whether they happen to be in Opposition now or on the Government Benches and thus potential Opposition Members, should be prepared to be judged by results? If they succeed in reducing inflation, they can be prepared to accept some of the benefit.

I thank my hon. Friend for his useful, helpful and precise interruption. I have joined him in voting down measures of indexation of the sort that he mentioned. If our constituents could pack the Strangers Gallery tonight, they would take rather a dim view of the motion when inflation is still high. The date of I July is a rather odd one for the motion to take effect. It might have been more appropriate to have selected the beginning of next year, when inflation will be far lower than it is now.

There are many of us who accept the basic dislike of a taxpayers' subsidy to political parties no matter how it is dressed up. Nevertheless, we feel some diffidence about the fact that when the Conservative Party was in Opposition it took the money offered to it by the Labour Government. Can my hon. Friend help people like me who were not Members of the House at the time to know how we can salve our consciences?

My hon. Friend, like myself, was not a Member of Parliament at the time of the March 1975 debate. We were not able to participate. Opposition Members shouted during the speech of my hon. Friend the Member for Orpington, asking whether he had voted in that debate against the principle of financial assistance to Opposition parties. My hon. Friend had a momentary lapse of remembrance. I have the Division list here. I can assure my hon. Friend that he registered two votes on that occasion against the principle in two separate Divisions.

I see the difficulty, raised by my hon. Friend the Member for Dorking (Mr. Wickenden, for hon. Members who served in the last Parliament. It is not a difficulty that affects 80 or so of the newer hon. Members who are sitting in this Parliament for the first time. Nor should it be a difficulty for certain members of the present Administration. It should not be a difficulty for my hon. Friend the Member for Blaby (Mr. Lawson), the Financial Secretary to the Treasury, who, correctly on that occasion, voted against the principle of the measure. I am sure that he will join us tonight. Six other present Government Ministers went into the Division Lobby against the matter on principle.

My central argument is whether the increase of financial assistance to Opposition parties will be well spent. If public money is being spent, it is necessary to look at the record of the Labour Party in Opposition during the last 17 months. There may have been a few hiccups this week when Labour Members knew that the recess was creeping up and were able to stomach one or two late nights. For the rest of the time, it has been rather milk-and-water stuff. Labour Members have spent most of their time in Opposition opposing not the Government but each other. That seems extraordinary.

My hon. Friend the Member for Orpington raised the important point of public money being spent on parliamentary duties as opposed to party duties. He was eager to gain a distinction—

It being one and a half hours after the commencement of proceedings on the motion, the debate stood adjourned.

Debate to be resumed this day.