This is one of the issues currently being considered in the inter-party talks chaired by Sir Hayden Phillips. The Government very much hope that a consensus can be reached between the parties to restore public confidence by tackling the spending arms race.
An opinion poll commissioned earlier this year by Unlock Democracy showed that 76 per cent. of the public support cross-party talks on party funding. Would the Secretary of State agree that it would be a grave error of judgment if one political party were to withdraw from the commitment on party funding for reasons of petty political advantage?
I would, and I hope that no party withdraws from the talks. The last time we reviewed the issue of party funding was in 2000, and I led those discussions. We were able to reach all-party agreement. The problem, however, was that Lord Neill recommended a tightening of expenditure limits in his report in 1998, and we all thought that that was agreed. However, it has not turned out to be the case, and as Sir Hayden Phillips made clear in his report in May, the Political Parties, Elections and Referendums Act 2000 sought to control the level of spending but has proved inadequate to the challenge. The changes in respect of local spending have had the consequence—entirely unanticipated by all parties—of leading to more lax controls on local spending rather than the reverse, which was what all parties at the time intended.
Does my right hon. Friend agree that it is vital to plug this local loophole before politics descends into a mercenary battle to see who can raise the most money? There is an urgent need for a Bill in the Queen’s Speech to extend the current limits on national campaign expenditure to local parties and candidates.
I remain hopeful about that. I draw to the attention of the House, and of my hon. Friend, the fact that when we discussed this issue on 15 March 2007, the right hon. Member for Maidenhead (Mrs. May), on behalf of the official Opposition, said:
“we are happy to discuss spending caps on all year round non-election campaigning”,
as well as other controls. I hope that that is still the position of the official Opposition.
Most people will be astonished by the front of Labour Ministers, such as the Government Chief Whip, who call for controls on party donations but want to exempt unions from those controls. We have called for a comprehensive cap on all donations so that individuals, companies and trade unions are treated equally. Is it not obvious why the Government have rejected this? They do not want to give up the £17 million of funding they received from the unions last year. In exercising his responsibility for policy on party funding, will the Lord Chancellor be acting in the interests of the public or the interests of his party?
I am tempted to descend to the level that the Conservatives have now reached on this issue. However, I live in hope that the constructive, consensual approach that they were taking under the Leader of the Opposition only a few months ago will continue. The hon. Member for Arundel and South Downs (Nick Herbert) has not been party to the all-party talks. Those of us who have know well that each party has had to accept significant compromises to reach a consensus. That remains my hope and desire, but it can be achieved only if the spirit in which we entered into the talks, and which continued until July, goes on. I greatly regret that, for reasons that remain unexplained, the Conservatives cancelled the next meeting of those all-party talks, which was due on the 3 September, and that they have had the most extraordinary difficulty in finding a date to suit them since then.
The Lord Chancellor conspicuously failed to answer the question. There is no possibility of achieving consensus while union barons control affiliation fees. By not counting £8 million of donations, he drives a coach and horses through the principle of capping donations. Is it not clear from his answer that the Government have not the slightest interest in securing a level playing field for party funding? Is it not also clear that their only interest in the conduct of elections is exactly what the Electoral Commission’s report described yesterday—partisan interest above the public interest?
I think that the hon. Gentleman protests too much. Before he starts examining the mote in our eye, he should look at the beam in his own. He totally misunderstands the way in which individual union members have a choice—[Hon. Members: “Oh!”] They have two choices. First, under Conservative legislation, they vote in ballots at least every 10 years—[Laughter.] I do not know why Conservative Members are mocking—I am taking about their legislation. Secondly, unions can make a voluntary decision about whether to pay the political levy or opt out of it.
Only one party has ever sought to act in a partisan way on party funding—the Conservative party. [Interruption.] We sought to act on a consensual basis in 2000, and we achieved that consensus with the Conservative party and with the Liberal Democrats, and I hope that we can reach it again.
Is it not clear that the official Opposition are so hooked on their regular injection of funds from the gentleman in the other place that they are not interested in consensus, and that to satisfy the public that democracy is not being bought, we will have to introduce legislation in the next Session?
It was understood by the Conservative party when it entered into talks—it may have forgotten about it since then—that the fundamental problem with the regulation of party funding at election time and between elections is the need to control total spending. I hope that nobody in the House, or any British political party, supports uncontrolled spending reaching the levels that we see in some other countries, including the United States.
Let me repeat the point that I made a few moments ago. When the House implemented the Neill committee report on a consensual basis, it was agreed that party funding at elections between the two main parties would total £40 million. As Sir Hayden Phillips’ report makes clear, spending at the last election was £95 million. It is not in anybody’s interest for that “arms race” to continue. I therefore greatly hope that the Leader of the Opposition will instruct his representatives on the Hayden Phillips working party to revert to the constructive approach that the Opposition had until the summer.