The law relating to donations to political parties is principally set out in part IV and schedules 6 and 7 of the Political Parties, Elections and Referendums Act 2000. Under that Act, it is for the Electoral Commission to issue guidance on the operation of the law. That guidance is available on the commission’s website, www.electoralcommission.org.uk. I have a copy here which I should be happy to pass to the right hon. Gentleman.
Would it help if, rather than contemplating more legislation, the Labour party started to observe the law that it passed itself? Can the Secretary of State explain how it is that some trade unions pay the Labour party individual affiliation fees for more than 100 per cent. of their members, and will he advise the trade unions to stop that particular abuse before the police do so?
The right hon. Gentleman answered the end of his own question towards the end of his comments. Let me make it clear that there is absolutely no evidence that the trade unions have failed to observe the law, and the requirements made of them under both trade union and electoral law legislation. There was none up to 1998, when the Neill Committee on Standards in Public Life reported. At that stage the Conservatives, in full possession of all the evidence about levels of compliance, said that they had no plans whatsoever to change the law governing trade unions, and the Neill committee said the same. During the Hayden Phillips inquiries, however, we have accepted that changes are necessary, and I accepted that when I spoke in the House last Tuesday.
The test is really for the Conservative party, however. The Conservatives said that they welcomed the publication of Hayden Phillips’s report and accepted his main recommendations: exactly those words were used by the right hon. Members for Maidenhead (Mrs. May) and for Horsham (Mr. Maude). The question now is whether they will match their promise with undertakings to meet what Hayden Phillips set out.
I listened carefully to the Secretary of State’s answer to the question asked by my right hon. Friend the Member for Wells (Mr. Heathcoat-Amory). Is the Secretary of State seriously condoning the Soviet-style practices of trade unions, which are affiliating more members to the Labour party than they themselves have as members? Many of those members do not have the opportunity to direct where affiliation fees are paid, and many of them vote Conservative.
What I can do is congratulate the hon. Gentleman on being able to read an article by Matthew Parris in The Times last Saturday that contained the ridiculous reference to Soviet-style operations. I admire his mimicry, if nothing else. I also say to him, yet again, that when we asked the Electoral Commission whether it had any evidence of a failure to comply with the spirit and the letter of the law in respect of trade union contributions, it said that it had none. The certification officer has reported that over the past 10 years three complaints have been made, only one of which has been upheld. We accept that the law in this area needs to be brought up to date—that has come out through the inquiries by Hayden Phillips in which we have participated—but the question for the Conservative party is whether, having accepted the full gamut of what he proposed, including spending limits at local and national level, it will back fine words with support for this policy.
We are talking about smoke and mirrors, and funding of political parties. Does my right hon. Friend think that we could be told how Conrad Black got his peerage? Can we be reassured that the reason was nothing so grubby as to involve money? There is no logic as to why even the Conservative party would have asked that man. He does not attend the House of Lords—he soon will not be able to do so—and was not a national of this country, so I want to know why he was preferred over and above the many thousands of Conservative party activists.
I am afraid that the Conservative party moves in a mysterious way, and it is not for me to speculate as to those reasons. In our White Paper on House of Lords reform, we committed ourselves clearly to ensuring that the same disqualification rules apply when peers have been convicted of a criminal offence as apply to Members of this House—and the sooner, the better.
Will my right hon. Friend confirm that, after the Tories introduced legislation enforcing requirements for the trade unions to hold ballots every so many years in order to take part in political donations, that money was clean at the time when Asil Nadir gave £400,000-odd to the Tory party, which never came back? Does he also agree that that trade union money was clean in 1998 when the drug baron in China gave $1 million to the Tory party for a printing press in Reading—money that was never given back? In other words, throughout this period the trade union money has been clean and the bosses’ money to the Tory party has been dirty all the time.
My hon. Friend, as ever, is entirely accurate. The simple truth is that whatever smokescreen the Conservative party now wishes to erect around the issue of trade union money, it was the Conservative party, as he, I and others in this House recall, that sought time after time during the 1980s to change those laws to make it more difficult for trade unions to make contributions to the Labour party. The Conservatives thought that the ballot system would result in trade unions eschewing association with the Labour party, but through democratic voting, it turned out that they were wrong.
Does the Lord Chancellor agree that when these important laws on political donations are broken, ignorance of the law can never be an excuse? Does he further agree that it is even more ridiculous to claim that no intentional wrongdoing has taken place, as some of his party have claimed?
What I say to the hon. Gentleman, because I am a generous fellow, is that on this occasion I agree with the Leader of the Opposition. In his press conference on 3 December, he made an important reference, saying that all parties make mistakes and that all of us have done this over the years. So we know that innocent mistakes and mistakes of compliance can be made.
Can my right hon. Friend confirm that any proposed changes to the law on party funding will apply throughout the UK?
Almost all electoral law is reserved and therefore any changes will apply throughout the UK.
It is utterly astounding that the Lord Chancellor talks about the Conservative party when what is in question this afternoon is, as the Prime Minister himself has said at the Dispatch Box, that the Labour party has broken the law. I wonder what the Lord Chancellor is afraid of, because it is he who is hiding behind a smokescreen. The Government make the law and then try to find every possible way to get around it or indeed to break it. Does he accept that it is the Government’s very integrity and trustworthiness that are now at stake? It is his party that has broken the law and brought our democratic process itself into disrepute. It is his party that is in power, so the question is not what we are going to do, but what he is going to do to restore the faith of the British public in our democratic system.
I like the hon. Lady and she is held in great affection by the House, but synthetic ranting will not do her much good. It was this Government who established a full-scale inquiry into party funding in 1997 when the Conservatives had refused it for years. We introduced the laws on transparency that have ensured that, when they are transgressed, those failings are exposed. As the Under-Secretary of State for Justice, my hon. Friend the Member for Lewisham, East (Bridget Prentice), spelled out when she wound up last Tuesday’s debate, no one on the Labour Benches excuses for a second things that have happened inside the Labour party that we greatly regret. We have made that absolutely clear, but my responsibilities are as a member of the Government, and we are proud of the legislation that we have introduced. I hope that there will be backing for what Hayden Phillips proposes, including for changes to the present lack of transparency in respect of unincorporated associations, which include not only the Midlands Industrial Council, which funded the campaign of the shadow Minister of Justice when his constituency of Arundel is miles away from the midlands, but Marginal Magic, which funded the Conservative campaign in Ludlow at the last election.
Does my right hon. Friend accept that what is required is speedy legislation in the new year in order to stop the sort of abuse by which Lord Ashcroft is trying to buy up marginal constituencies? Is not that the sort of practice that should have stopped in the 19th century and can my right hon. Friend promise us that we will not have to wait too long for such a change in the law?
There is certainly an important case for changing the law—if it is possible, although it may not prove so—as Sir Hayden Phillips recommended. I hope that we can gain all-party agreement on that, but it may not be possible. Meanwhile, there are some important questions for the Conservative party to answer in respect of the tax status of some of its major donors. All of us remember last Tuesday when, time and again, the right hon. Member for Horsham (Mr. Maude) gave a carefully crafted but indirect answer to clear questions that were posed to him.