With permission, Mr. Speaker, I would like to make a statement about the funding of political parties. The Government are today publishing a White Paper on party finance and expenditure in the United Kingdom. Copies are available in the Vote Office and on my Department’s website.

How our politics is funded is vital for the health of any democratic system, including ours. Over the last decade, important steps have been taken towards achieving this. In 1998, the Committee on Standards in Public Life, under its then chairman, Lord Neill of Bladen, published a landmark report, which went on to form the basis of the Political Parties, Elections and Referendums Act 2000.

It must also be fundamental to the health of our democracy that the regime for regulating political parties should never be used as a partisan tool by one party against others, and instead that change should be by way of broad cross-party agreement and achieved in a manner that carries wider public support. That spirit led to the passage of the 2000 Act by consensus and continues to be a guiding principle for this—and I hope any—Government’s approach.

The 2000 Act represented the first major overhaul of the regulation of party funding and expenditure for more than 100 years. It has greatly helped to improve transparency and standards, but it has not proved sufficient. In the intervening period, there has been continuing public disquiet about many aspects of how parties and politicians are funded. In March 2006, Sir Hayden Phillips was therefore invited by the then Prime Minister, Tony Blair, to conduct a further review, including as to whether state funding should be enhanced in return for a cap on donations.

Sir Hayden’s final report was published in this House on 15 March last year. It made major recommendations for reform of the Electoral Commission, for tightening the controls on expenditure, for greater transparency and for a gradual move to enhanced state funding linked to a cap on donations. All parties explicitly welcomed Sir Hayden’s report and accepted its main recommendations, including those for cross-party talks chaired by him to take forward the report’s recommendations. Those talks proceeded satisfactorily until last year’s summer recess. Sir Hayden then issued detailed proposals based on what he judged might form the basis for a consensus between the parties. It is a matter of great regret that, in late October, one of the parties decided to walk out of the talks, making agreement impossible.

Against that background, Her Majesty's Government undertook in the Queen’s Speech to bring forward proposals on party finance and expenditure. The White Paper is the result. It proposes measures to improve the regulatory system. It sets out the Government’s aspiration for long-term comprehensive reform, building on the model proposed by Sir Hayden Phillips. In those areas where the Government believe that a broad consensus exists, it outlines plans to bring forward immediate legislation, including reform of the Electoral Commission and more effective controls on candidate spending.

The excessive spending by parties and candidates gives rise to the wider problems with party finance that we see today. Repeated independent reviews—including those from Sir Hayden Phillips, the Committee on Standards in Public Life and the then Constitutional Affairs Committee—have called the problem a “spending arms race”, although some individuals, I know, still question its existence. But a spending arms race is evident within each electoral cycle. As Sir Hayden’s report said, spending by the two largest parties was £90 million in the 12 months preceding the 2005 election, up from £65 million in the 12 months before the 2001 election. That was despite the campaign limit being set at £20 million for each party. Although the parties did not act unlawfully, their ability to spend well above the campaign limit under the Act reveals a problem with the rules. In the interests of democracy, we need finally to achieve what all parties had sought to do through the 2000 Act, and to stop this damaging arms race.

The White Paper proposes some important steps for immediate action. Strengthening the Electoral Commission will send a clear signal that politics and politicians are effectively scrutinised: never above the law. The Electoral Commission will have robust civil sanctions to deploy, with criminal proceedings as an alternative. The commission will have more effective investigatory powers, enabling it to access information from anybody when it suspects a breach of the rules. Its governance arrangements will be overhauled better to ensure that greater practical experience is available to it.

The Committee on Standards in Public Life, the then Constitutional Affairs Committee and Sir Hayden Phillips all recommended that the commission would benefit from the knowledge and judgment of individuals with political backgrounds. Therefore, we propose, as the Committee on Standards in Public Life recommended, the appointment of four commissioners with recent political experience and fewer restrictions on staff appointments. Far from politicising the Commission, that will enable it better to understand the people it regulates and so help it to do a more effective job.

There has been widespread concern that a loophole in the 2000 Act has allowed certain unincorporated associations to obscure the original source of donations to parties. Therefore, as the Phillips review proposed, those will be better regulated, as will third-party campaigning organisations.

Let me turn to spending by parties. In 2000, when I took through the Political Parties, Elections and Referendums Act, all believed that we were, in the words of Lord Neill’s report, “buttressing” the existing restrictions on spending, including those in the Representation of the People Act 1983 and its predecessors. What we did not foresee at the time was the likelihood of significant increased and unregulated candidate spending as a result of the detailed drafting of the Bill, although the late Lord Mackay of Ardbrecknish, who was on the Conservative Front Bench, sought to alert us to the problem by tabling a clarifying amendment on behalf of his party.

The White Paper proposes a return to the system of “triggering”, which will regulate all candidate spending directed towards electoral success, and which was a key feature of the last Administration’s 1983 Act. A stronger, more focused Electoral Commission will help to avoid the previous uncertainty about the rules. In parallel with that, we propose to re-examine the list of activities that are defined as campaign spending.

Let me turn to the question of introducing donation caps in return for enhanced state funding. To do that, we would have to carry with us not only all the main parties, but the public—the taxpayer—as well. That is not happening at present. We are very ready to have the debate, and, indeed, to discuss donation caps at a lower level than Sir Hayden recommended, but that will require us to come together to allow discussion between the parties and the public. I intend to introduce a Bill before the summer recess, but with Second Reading taking place in the early autumn and the other stages being carried over into the next Session. That will provide ample opportunity both for comments to be made to us and for scrutiny to be carried out.

By any international comparison, the standards of our political system have long been high. Nothing more infuriates most Members of Parliament, local councillors and, especially, the thousands of unpaid voluntary activists in all parties than the fact that their work and good faith can be tainted by the failures of a very few. However, perceptions matter hugely. I hope the whole House recognises the imperative in these circumstances of strengthening the probity of British politics and of people’s faith in our democratic process as a whole. That is the principal aim of the White Paper, and we hope that all parties will support us in our endeavour. I commend the statement and the White Paper to the House.

I thank the Secretary of State for advance sight of his statement and of the White Paper. I think the whole House will agree that party funding reform is very much needed to restore trust in our politics, and to deal with the perception that large donations, whether from individuals or from organisations such as trade unions, can buy undue influence over policy or patronage.

I entirely agree with the Secretary of State that perceptions matter hugely. That is why we produced radical reform proposals early in 2006, well before Sir Hayden’s appointment. Sir Hayden, incidentally, deserves our huge thanks for the enormous work that he put in. His proposals on Electoral Commission reform are especially welcome. We took part in the discussions enthusiastically, and, as evidence of our commitment to reaching agreement, even accepted that an overall settlement could include an increase in state funding, although we neither seek that nor consider it desirable. We further accepted that there could be overall caps on spending by parties, although it is clearly how money is raised that worries the public, not how much is spent. [Interruption.] It is interesting to note that Sir Hayden’s terms of reference refer only to donations. Spending by parties does not even get a mention.

The Secretary of State will recollect that, in setting up the review, Tony Blair said explicitly that there would be no no-go areas and, in particular, that trade union funding should not be exempt from any donation caps. Was it not always understood that reform must be comprehensive, and that there should be no cherry-picking to serve the governing party’s partisan interests—that nothing would be agreed until everything was agreed? Does the Secretary of State accept that a partisan Bill now cannot provide the basis for a long-term and sustainable settlement? Has he read the independent research by Dr. Pinto-Duschinsky, which shows that there is no arms race in party spending? Is this not a myth to give credence to a bankrupt Labour party’s desire to hamstring its opponents?

Will the Justice Secretary agree that the discussions came very close to overall agreement, but foundered on the key issue of whether trade union donations should be subject to donation caps on the same basis as other donations? Will he now place in the Library the minutes and the background papers to the review, which will show that it was Labour’s refusal to allow further work on trade union funding that brought the talks to an end? Does he recall that he and Peter Watt—the then Labour general secretary—refused point blank even to discuss giving trade union members the right to a real choice in whether to pay the political levy? [Interruption.] Well, does the Secretary of State remember the revelation that a Lib Dem MP received a ballot paper for Labour’s leadership contest, having unwittingly become a Labour party member through a trade union? Will he not acknowledge that when trade unions routinely declare that 100 per cent. of their members—and in two cases, more than 100 per cent.—are paying the political levy, the idea that these are voluntary individual donations to Labour are laughable, especially when polling shows that fewer than half of union members even vote Labour, let alone want to support it financially?

Does the Secretary of State accept that his proposal to reintroduce “triggering” was not even part of Sir Hayden’s draft agreement? Is not this change designed to make it more difficult—a caption in the White Paper makes this clear—for candidates to campaign effectively, and thus to benefit sitting Labour MPs? Does the Secretary of State not understand that it would be an atrocious abuse of power for the Government to force through restrictions on what parliamentary candidates can spend from money they have raised privately, while sitting MPs can spend ever-more taxpayers’ money on promoting themselves?

Last year, we came close to an overall comprehensive agreement that could genuinely have started to repair the public’s trust in politics, and I say to the Justice Secretary that we can still achieve this. However, it would require Labour to accept that dependence on a small number of union bosses has to end. Sadly, it is hard to see that happening when 92 per cent. of Labour’s income comes from the unions, which even now are squaring up to demand their payback in the form of a Warwick agreement mark 2. It is precisely Labour’s dependence on these union bosses and the big donor culture that is preventing us from getting the reform that our politics so desperately needs.

I greatly regret the tone adopted by the right hon. Gentleman, and his unsuccessful and thin efforts to rewrite the history of what happened in respect of the Hayden Phillips discussions, for as he knows—and as the hon. Member for Somerton and Frome (Mr. Heath), who was present, has stated—the truth is that we, the Conservative party and the Liberal Democrats all said on 15 March that we were ready to negotiate on the basis of the Hayden Phillips recommendations, and we did so. Indeed, we continued to negotiate on that basis until there was a sudden change, late in the summer of last year, in the policy and approach of the Conservative party. The hon. Member for Somerton and Frome told the House that

“the process that led to the breakdown of the talks…was caused by the Conservatives walking away.”—[Official Report, 7 November 2007; Vol. 467, c. 224.]

The right hon. Gentleman may, if he wishes, put in a freedom of information request for the minutes, but he has not yet done so. That would deal with this situation, however. An independent individual could judge the issue. We would consider this, but it is a matter for Hayden Phillips, not for me. However, we do not need FOI requests or the minutes of the meeting, because two other Members of this Chamber, as well as the right hon. Gentleman, bear witness to precisely what happened. The truth is that, as we have just witnessed from his partisan approach—which was totally different from the one that he and his party colleagues adopted in the working party—the Conservative party decided to move away from the main recommendations of the Hayden Phillips report. [Interruption.] Did the right hon. Gentleman say, “Yes”? [Interruption.] Indeed, Hayden Phillips did deal with the issue of trade union funding.

We made it clear, before and afterwards, that we were ready to implement what Sir Hayden Phillips proposed, but the Conservative party sought to recommend something very different, breaking not only the spirit of what he had said, but, for example, of what the Constitutional Affairs Select Committee had said. It said, again endorsed by Sir Hayden Phillips, words to the effect that no party had the right by legislation to seek to change the constitution of another party. We have never done so. We could have when we had a very considerable majority in this House back in 1999 and 2000; we still have, and we are not going to do so.

The right hon. Gentleman said that there is no arms race. This defies arithmetic and everything that his representatives said in the working party with Sir Hayden. I will quote, if I may, the then Opposition spokesperson on this issue, the hon. Member for Arundel and South Downs (Nick Herbert):

“We are much more interested in reducing the cost of politics and that is what David Cameron has made clear.”

So far as Dr. Pinto-Duschinsky’s so-called research is concerned—it rather desperately needs some peer reviewing—he very skilfully selects mid-term spending by political parties. He says that there was

“no time to analyse published and unpublished budgets of Labour and Conservative…organisations for 2004, 2005 and 2006”.

How convenient, because what we see and what we know is that spending always rises in the last two years before a Parliament is due to end. Had he addressed himself to the available research—the much better research—by the Joseph Rowntree Foundation, he would have seen, for example, that spending donations received in local Conservative parties and marginal seats averaged £19,600, compared with £6,500 and £7,700 in Labour and Liberal Democrat marginals. What we—and, I believe, the Liberal Democrats—wish to see, and what the Conservative party wished to see until last summer is sensible, non-partisan rules that we can come together and agree on. I hope that, even at this late stage, the Conservative party will think again.

rose—

Order. A considerable number of Members are hoping to catch my eye. Time is limited and there is a further statement to follow; may I please ask for one brief supplementary question?

I am also grateful for prior sight of the Justice Secretary’s statement and the White Paper.

We Liberal Democrats welcome new investigatory powers for the Electoral Commission, its proposed new governance arrangements and transparency for unincorporated associations. In general, however, I have to say that this is a woefully inadequate package, and the Secretary of State is getting scant reward for his modesty from the official Opposition. There is nothing in this statement that will stop the arms race between the parties. He was quite right in his remarks about Dr. Pinto-Duschinsky’s paper—which was, by the way, produced and published by a Conservative-leaning think-tank. Nor is there anything that will clean up party funding by capping big contributions. There are no caps on donations or local spending, and is public confidence not at a low because the Labour and Conservative parties are seen to be in the pockets of big business or the trade unions?

Is it not scandalous that there is nothing here that will impede Lord Ashcroft, through his UK company, Bearwood Corporate Services Ltd, in trying to buy any number of parliamentary seats? Lord Ashcroft already accounted for 8 per cent. of Conservative funding last year. The Justice Secretary says that he can legislate only with all-party consensus, but in that case, many abuses would never have been cleared up, including some of the most anti-democratic practices of the trade union movement that were put right in 1984 by the Conservative party against the Labour party’s views at that time. Are we now to give miscreants a right of veto over new offences?

Does the Justice Secretary really think it just a coincidence that the Conservative party broke off cross-party talks in the very quarter when it took record donations of £9.7 million, which was an increase on the previous quarter’s £3.7 million and a record quarter for a non-election year? Was that mere coincidence? Why should the Government not now legislate to remove the stink of big-money politics? Is it not time that millions of votes, not millions of pounds, decided British elections?

The hon. Gentleman has had time to read the White Paper because it was sent to him, as it was to the right hon. Member for Horsham (Mr. Maude) earlier today. I hope that the hon. Gentleman does read it carefully. No one is talking about any one party having a right of veto; indeed, I was surprised to hear the right hon. Gentleman appearing to claim that it was wrong now to legislate on strengthening the work of the Electoral Commission and re-introducing the trigger, which formed a central part of the Conservatives’ legislation and which they tried to ensure, for the avoidance of doubt, stayed as part of the 2000 Act. I wish that I, or our Minister in the Lords, had accepted that; the only reason we did not do so was because we were told that it was not necessary. We will proceed on that basis, but I think that the hon. Gentleman will accept that no one party should use the party funding regime as a partisan tool, because we must ensure that there is stability in the system that we adopt.

I accept, and share, the hon. Gentleman’s frustration about the fact that we came very close to reaching an agreement last summer. It would have involved many important, significant and difficult changes in my party, as well as in other parties, but we were aborted in that by the events to which a number of us in this House were certain witness.

On the hon. Gentleman’s question about groups such as Bearwood Corporate Services Ltd, we propose that there should be proper regulation of unincorporated associations, so that the source of the original donor becomes clear.

If my right hon. Friend intends to proceed, as I think that he is right so to do, on the basis that any agreement must be made by consensus across the political parties and if he can persuade the Conservative party back into those talks, will he also seek to persuade it that the donation cap of £50,000 that has been discussed is a long way above what ordinary people understand and that there is an overwhelming case for lowering it to a level that would put politics back in the control of the ordinary people of this country?

I agree with my hon. Friend. Our White Paper includes a lot of detail about how it is thought donation caps would impact at different levels on the spending of different parties. The sum of £50,000, which was Sir Hayden Phillips’s recommendation, is a lot of money for the overwhelming majority of families in this country, and we are certainly ready to sit down to talk about a lower spending cap, as my hon. Friend indicates.

I very much regret the omission of any proposals to impose a cap on donations. They would be welcome, although only if they were to extend to trade unions. May I ask the right hon. Gentleman to remind the House how much money the Labour party has received over the past five years from Unite, which is the union maintaining the industrial dispute involving tanker drivers?

We are ready to answer that for which I am here to answer. We were ready to negotiate an arrangement with the other parties on the basis of what Sir Hayden Phillips recommended, including in respect of the trade union donations. We continue to be ready to do that.

I welcome the general thrust of my right hon. Friend’s proposals in the White Paper, particularly as regards a spending cap, but may I point out that many in all parts of the House have reservations about linking a spending cap to state funding?

I understand that, and we all need to understand that Sir Hayden Phillips estimated that, at £50,000, the enhanced state funding needed to compensate parties for the loss of income would run at between £65 million and £90 million over a Parliament. A big issue for us, as the trustees of the public purse, is whether or not now is the appropriate time for that amount of taxpayers’ money to be spent on political parties.

Bearing in mind that Sir Hayden Phillips’s proposals were based on the unanimous views of the Constitutional Affairs Committee, does the Secretary of State recognise that the Government’s moral authority to legislate in this sensitive field is undermined if what they propose is not the full range of Sir Hayden’s proposals, with their different but significant impact on all political parties, including his concern about the potential power of paymasters of whatever kind?

First, may I offer my congratulations and, I believe, those of the whole House to the right hon. Gentleman on his knighthood, which was announced in the birthday honours on Saturday?

Secondly, on the question, the Select Committee on Constitutional Affairs produced recommendations that were taken forward by Sir Hayden, who made proposals, which we have previously discussed in the House. However, it is very difficult to move forward, since, among other things, Sir Hayden outlined his proposals but then said that the detail had to be negotiated between the parties. It was very difficult then to take that forward without the kind of constructive negotiation in which representatives of the Liberal Democrats, Labour and the Conservatives were participating perfectly happily until the summer recess last year. That is the problem. If the Conservative party now wishes to go back to where it was last July, we are happy to join it, and I believe that the right hon. Gentleman’s party would also be happy to join it.

I welcome the direction of my right hon. Friend’s statement this afternoon and the proposal to introduce the trigger mechanism into spending that is registerable as campaign expenditure. Does he accept, however, that the expenditure arms race is percolating across the whole electoral period and all forms of spending, national and local? Does he consider that a trigger mechanism and, indeed, the White Paper’s contents are a way station towards an overall cap on the expenditure of parties between general elections and during entire Parliaments?

Yes, I accept that, and Sir Hayden Phillips and previous reports have recommended that continuous, all-Parliament spending limits should cover what we loosely describe as national and local spending. That is, however, very complicated and requires detailed discussions between the parties and the Electoral Commission.

The Justice Secretary is right in thinking that the great British taxpayer would be horrified at the prospect of yet more of their money being used to fund political parties, but is that not what we have done in a back-door way with the communications allowance, which allows MPs £10,000 a year to tell our electorates how great we are? Therefore, the candidates in our seats may feel that they have to spend more just to keep pace with us. Will the Justice Secretary consider the abolition of the communications allowance and the saving of millions of pounds of taxpayers’ money?

The recommendation on the communications allowance happened to be a unanimous one from the House of Commons Commission, but I understand the hon. Gentleman’s point. I have said in the House that there should be serious discussions about the communications allowance, or that part of it which I do not think is used for party spending, given the rules, but which might be seen to be. Let us sit down and discuss it. What we and the Liberal Democrat party have been frustrated about is that there have been no constructive discussions on this issue, because the Conservative party walked away.

I welcome my right hon. Friend’s proposals on unincorporated associations—a mechanism that has been used by the Conservative party to hide the source of millions of pounds of funding not only to party central office but to individual Conservative Members. Will my right hon. Friend consider making the transparency of those unincorporated associations retrospective to the beginning of this Parliament, so that we can find out where a lot of the money that is sloshing around the Conservative party has come from?

I am not sorry to tell my hon. Friend that there are clear rules against making provisions that carry sanctions, as these will, retrospective. Therefore, the Bill will not contain proposals of that kind.

May I put it to my right hon. Friend that in the long term the key is to insert caps on spending rather than on donations, so that we get back to issue-driven rather than money-driven politics? With the benefit of hindsight, does he agree that the £20 million cap on national spending in the 2000 Act was rather too generous and that we should perhaps think about halving it at the next election?

I agree with the central burden of what my hon. Friend has said. The £20 million cap would be better than the current situation if it covered all campaign spending, and therefore one of the proposals to which I drew attention in my statement is that we should look again at the definition of campaign spending in schedule 8 to the 2000 Act as well as moving towards comprehensive all-Parliament controls in the future.

Will not the reintroduction of the trigger give more power to the national party and less to local candidates who want to get their point across locally?

I honestly do not think so. That issue was not raised by Neill or during the passage of the 2000 Act or its predecessor, the Representation of the People Act 1983. Neill said that all his proposed controls should be in addition to the 1983 regime—“buttress” was the word that he used. Everybody thought that that was the case except for the noble and acute Lord Mackay of Ardbrecknish. From the Opposition Front Bench in the other place, he moved amendments to clarify what he thought might be a loophole in the law on advice that was turned down as unnecessary by Ministers in the Lords. I have regretted that decision of ever since. I do not think that there is any evidence to suggest that the worries expressed by the hon. Gentleman will be substantiated, but I will check and write to him.

Sir Hayden Phillips did a very good job during the talks, in which I played a part, in establishing near consensus on a wide range of issues concerned with party finance. He also found some of the answers, until the Conservative party decided to change the question rather late in the day and therefore left the talks. Is it not therefore very disappointing that the proposals that the Lord Chancellor has brought forward today fail properly to address the issues of the cap on donations and expenditure and to make the significant changes to the transparency and propriety of trade union funding that we agreed?

I share the hon. Gentleman’s disappointment. He was party to the talks, and he represented his party very effectively. The right hon. Member for Horsham also represented his party very well, but his script was changed sometime in the summer of 2007. It is disappointing, but we can make progress, if there is broad agreement across the Chamber on spending controls, which is what we are proposing. Everybody, apart from one or two flat-earthers, recognises that the rise in spending is the driver for all the other problems.

I welcome my right hon. Friend’s proposals to close the loopholes on unincorporated associations and candidate spending. I also welcome cross-party consensus on the issue, if it is forthcoming. May I remind my right hon. Friend that to insist on cross-party consensus at all costs is to hand a veto to the Opposition? Some enlightened Members of the Opposition see that their interest lies in closing the loopholes, but others see that their interest lies in keeping them open. Those who want to keep the loopholes open are the ones who benefit from being able to escape controls on party spending by channelling money to local candidates and bypassing the controls on anonymous and foreign donations by channelling money to unincorporated associations.

We are not talking about a veto for any one party; we are talking about areas on which it is clear that there is already broad agreement, as there is in respect of the changes to the Electoral Commission—there must be broad agreement on that, given that I am reintroducing Conservative legislation that the Conservatives kept on the statute book from the 1980s right until they lost office in 1997.

We have sought to ensure that we follow through on the broad agreement on cutting spending—something to which all the parties subscribed—in terms of restrictions, but there are remaining issues to do with how we enhance state funding in return for donation caps. Those issues are complicated and—let us be clear about it—an increase in state funding would be involved, at a time when there are big questions about whether the taxpayer would be willing to bear that. There are many other complications, too. However, we were close to an agreement, and I hope that one day we will be close to one again.

I participated in the talks from start to finish, and the Lord Chancellor’s description is a travesty of the truth—the House needs to know that. Frankly, the statement that we just heard was partisan. The return of the triggering rules will restrict candidates in marginal seats but not sitting MPs, who benefit from the communications allowance. As Labour holds all the marginal seats, is there not a blatant act of partisanship hidden under the guise of all-party agreement on the Sir Hayden Phillips talks?

That is completely untrue, and the hon. Gentleman knows it. I believe that he was among those who signed up to the unanimously agreed report by the Select Committee on Constitutional Affairs, but what he has subsequently said is completely different—both in spirit and in recommendation—from what was said in the Committee’s reports. He is one of the flat-earthers—he voted against the Climate Change Bill on the basis that it was bad science.

What has that got to do with it?

It says something about the attitude of mind of the hon. Member for Chichester (Mr. Tyrie). He continues to deny what is palpably true—namely that spending by political parties has increased, and will increase, unless we take control of it.

May I congratulate my right hon. Friend on not bringing forward a scheme for the state funding of political parties? Is he concerned that some current forms of candidate and party expenditure fall foul of existing spending limits?

Yes, they do; we accept that. I dealt with the issue of the 1983 trigger, to which, I notice, no Conservative politician ever objected—indeed, far from it—in my answer to the hon. Member for Ribble Valley (Mr. Evans).

Tight caps on individual donations and spending are essential to public support for the proposals, as is a debate on state funding, including existing state funding. As part of that debate, will the Government consider the Power commission proposals, under which state funding would be provided on a pence-per-vote basis only if electors chose to tick a box on the ballot paper? Does the right hon. Gentleman agree that that would focus parties’ attention away from expensive billboard campaigns and back towards more grass-roots campaigning and, dare I say it, engagement with the public?

There are a number of imaginative proposals for additional state funding, including the Power commission proposal, to which I was quite attracted. However, there are also problems with the proposals. We have to recognise that each of the proposals involves a transfer of funding from the taxpayer to political parties by some means or other. We would certainly need broad consensus on that, and we would have to carry the public with us.

The Conservatives in Ellesmere Port have adopted a new scam on their website; they are acting a bit like a discount warehouse. A whole raft of public, well-known companies advertise their wares on the local Conservative party website—BT was one of them, but I persuaded it to withdraw its advertising. Not one of the shareholders of any of those public companies has authorised such a donation. Will my right hon. Friend ensure that legislation stops that kind of scam?

I look forward to my hon. Friend raising that issue during the passage of the Bill. Meanwhile, if he has a complaint about the regulations, he should refer it to the Electoral Commission.

I congratulate the Lord Chancellor on ruling out further taxpayer funding of political parties. Will the Bill contain proposals for individual voter registration, as recommended by the Electoral Commission?

There are no proposals in the White Paper for individual registration, but I am grateful to the hon. Gentleman for what he has said. I am attracted to the idea of individual registration and believe that it has to happen.

Then do it.

We are going to bring forward—

When?

The hon. Member for Huntingdon (Mr. Djanogly) asked me a series of questions, and gave the answers before I could do so. If he calms down, I will give the answer. I intend to introduce proposals, but there are spending implications. I am in no doubt that we have to move forward, and a consultation document on this and other matters relating to the regulation of the voting system will be introduced soon.

Does the right hon. Gentleman know how offensive it is to ordinary members of the public who value our democratic traditions to see rich individuals bankrolling candidates before the election period commences? Would he expect a decent political party to stop that practice pending the reintroduction of the trigger?

I think that the independent hon. Member for Castle Point (Bob Spink) was referring to his former colleagues in the Conservative party. We look forward to further and better particulars of what he has to tell us about that party’s practices.

I was not minded to ask a question until I heard the sanctimonious bilge from the hon. Member for Eastleigh (Chris Huhne). In the document, there is nothing to address the abuse of incumbency. One of his senior colleagues has sent out letters in House of Commons-franked envelopes to all new voters on his register that include a leaflet slagging off the prospective parliamentary candidate in that constituency, so until the communications allowance is addressed, there is a serious problem and lacuna in the proposals.

I do not approve of that practice, and I have never followed it myself. We had a great debate about the communications allowance about 18 months ago, and one reason why it was introduced was to control the abuse of overspending, for example, on franked envelopes. That is one of the things that it has achieved, but I told the hon. Member for Ribble Valley that if there are issues—[Interruption.] I know that there are—to discuss, we should discuss them, but that requires all three parties to sit down and discuss them in talks from which one party should not walk away, knowing that they are departing from an agreed agenda established by an independent inspector.

The Lord Chancellor is right to talk about public perception, but does he not accept that the public will perceive that the Government are not serious about change until they break the umbilical cord between themselves, their party and the unions, and are seen to do so?

I do not accept that. I know that the hon. Gentleman has a different viewpoint about the relationship between trade unions and political parties, and he is fully entitled to make as many points as he wishes and to persuade his voters and others to support his party, not ours, because of our association with the trade unions. However, he must accept that trade union contributions to political parties, including the Labour party, are the most regulated of any contributions. They are completely clean—there have been no validated complaints against the payment of the political levy in the past 10 years. Contrary to what we heard from the right hon. Member for Horsham, members of affiliated trade unions know that they can opt out, and at least 10 per cent.—the percentage varies from trade union to trade union—do so. He is entitled to make comments about our connection with the trade unions, but what he is not entitled to do in a democracy is to try and rewrite our constitution in a way that suits his party, not ours.

Order. Will Members who do not wish to stay for the statement by Secretary Miliband leave quickly and quietly?