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Parliamentary Standards Authority

Volume 710: debated on Wednesday 20 May 2009


My Lords, with the leave of the House, I will repeat a Statement made in another place by my right honourable friend the Leader of the House of Commons. The Statement is as follows:

“With permission, Mr Speaker, and following on from your Statement to the House yesterday, I should like to make a Statement on the decisions made yesterday at the meeting of the Members Estimate Committee which you convened, with the Prime Minister, the party leaders and the chair of the Committee on Members Allowances, and on the Prime Minister’s proposals for a new parliamentary standards authority.

First, I want to set out how we are dealing with the past and the immediate steps that we are taking in the present. At the meeting last night we agreed a process, proposed by the Committee on Members’ Allowances, which will reassess Members’ claims over the past four years and which will identify those claims which should not have been made and should not have been paid out because they were outwith the rules, and make arrangements for repayment. The public are entitled to see a process of reparation and Members are entitled to know that this will be orderly and fair.

Secondly, on immediate steps, the House has already voted to ensure that the threshold for receipts has gone down from £25 to zero and voted to introduce full-scope audit under the National Audit Office. But, in addition to that, the MEC meeting last night agreed to an immediate ban on claims for furniture, a cap on interest payments for accommodation at the equivalent per year of £1,250 per month, a restriction on any changes to designation of main and second homes and preventing two Members who are married or living together as partners claiming more than one second home allowance. I understand that the MEC will meet later today to determine the detailed changes to the Green Book to put into practice the principles on which the party leaders and the MEC reached clear agreement. That should give immediate reassurance to Members of this House and to the public. But in order fully to restore public trust and public confidence, we need to have more than reparation and reassurance. We need renewal—to put in place a new system on a new footing. The House has already voted on 30 April to endorse the inquiry by the Committee on Standards in Public Life, which will come forward with its recommendations later on this year. Once again, I want to place on record my thanks to Sir Christopher Kelly and his committee for their work.

At the MEC meeting last night all parties agreed to the Prime Minister’s proposal that the keystone of any reform must be to switch from self-regulation to independent external regulation, and that we should end the gentleman’s club approach, where we set and enforce our own rules, and instead bring forward proposals for a new parliamentary standards authority. The proposal on which we seek to consult would see Parliament legislate to delegate specific responsibilities to a new, independent parliamentary standards authority.

The new parliamentary standards authority would revise and update the code of practice for Members of this House, investigate complaints where a Member of this House is alleged to have breached the code of conduct, take forward the implementation of the recommendations of the Committee on Standards in Public Life as to allowances, take responsibility for authorising claims for payment under the new allowance system, as well as disallow claims, be able to require payback of claims wrongly paid out, and be able to impose financial penalties.

It is clearly appropriate that this new body also takes responsibility for these issues in the Lords, including administering and regulating the system for Peers’ allowances, overseeing the code governing Peers’ conduct and the Register of Lords’ Interests, ensuring the highest standard of propriety and financial conduct, investigating alleged abuses of the system, and recommending any necessary sanctions.

In this House, we recognise that the principle of self-regulation operates differently in the House of Lords. It is clear that extensive work and consultation will be necessary in order to ensure the agreement of the House of Lords to the effective transfer of responsibilities to the new body.

But turning back to this House, disciplinary actions which might require sanctions, such as suspension from this House, which have a bearing on the ability of a Member to perform their work would remain, as at present, for the whole House, through the Standards and Privileges Committee. Only the electorate, or those who are themselves democratically elected, should be able to prevent a Member doing their work in this House.

So we have set in place the actions for reparation and for reassurance. For renewal for the future, we look forward to Sir Christopher Kelly’s proposals and we are further proposing that this House moves from a system of self-regulation to a system of statutory regulation. Although I know that it is hard to get a hearing on it now, I will, as Leader of the House, continue to argue both inside and outside this House that most honourable Members come into Parliament as a matter of public service and are hard-working, decent and honest.

However, we must recognise that, even before the allowances revelations, there was a problem of public disengagement, public cynicism and a public sense of distance from Parliament, and we must now seize the opportunity to promote a debate that will see the proposals to change and to strengthen our democracy move from the margins to centre stage—where they ought rightly to be.

Parliament and politics are important precisely because there are deeply held, different views about public policy and big choices, but there is consensus across all parties that we need to put the reputation of Parliament above reproach, and we will.

I commend this Statement to the House”.

My Lords, that concludes the Statement.

My Lords, I thank the noble Baroness for repeating the Statement. It is not for us to intrude on the other place or to comment on the system that was operated under the authority of Mr Speaker, but it is a sad day to see that great House under such a cloud.

My right honourable friend Mr Cameron has made it clear by his powerful leadership in this affair that he will brook no wrongdoing and expects the very highest standards from all members of this party in both Houses. I am glad to see that many of the suggestions first put forward by my right honourable friend are included in this Statement. The Government can be assured of full co-operation from this side in addressing this crisis, although I must say that the best and only way of cleansing Parliament would be an early general election.

We cannot be complacent in this House. Change must come here, and it will come here. We cannot resist calls for openness and transparency, and we must accept accountability. We must review systems of remuneration, propriety and discipline; but serious issues arise from the different natures of the two Houses, and I am troubled that this may be forgotten in the dash to do something. Laws made in Parliament in a hurry are rarely good laws; laws made for Parliament in a hurry may prove to be no better.

I am glad to see some acknowledgement of that in the Statement, although it seems to point two ways in that it says that a single authority must make rules for both Houses and, on the other hand, that your Lordships’ House is different from the other place. The Houses are different. The other place is paid; your Lordships are not. The other House is representative; your Lordships’ House is not. The other House had a complex expenses system costing almost £100 million a year, while your Lordships have a relatively simple allowance system costing £17 million a year. The other place is expected to be the primary employment of those elected there; for many Peers, what is called in the other place a second income is in this place your first.

I do not say any of this to resist the change or any further inquiry—quite the reverse—but can the Leader of the House, who as a member of the Cabinet is in a unique position to speak up for the House, assure us that nothing will be done by the back door to make this House a facsimile of the other place? If, for example, a model of a full-time salaried Parliament emerged from this process, it would inevitably have implications for who we are and how we get here.

Of course, none of us should harbour any illusions. There have been, and no doubt are, problems in this place, but their scale, nature and context are different from those of the other place and they may well require different solutions. The diversity of the two Houses of Parliament is one of the strengths of Parliament, and any regulator must understand that.

Yesterday afternoon, the House Committee considered the question of allowances. It was decided—and many noble Lords will have seen the press release that was so swiftly issued—that there should be an independent external review of Members’ allowances. However, if this is to be regulated by a new parliamentary standards authority, how will this House’s review relate to that authority and how will noble Lords be able to contribute to it?

On standards, the Leader of the House has convened a Leader’s Group of senior Members of your Lordships’ House to look into the code of practice and the register. I welcome that. But the Statement says that this will be the job of a new independent regulator. How will the Leader’s Group relate to this body? Will it report to it? Will the new body be able to reject the work done in your Lordships’ House on this question? In recent years, this House has worked hard right across the parties to develop a code of conduct and establish a register. Is that work now to be set aside?

We are shortly to discuss sanctions on the basis of a careful and authoritative report from your Lordships’ Committee for Privileges. The committee has policed and defended this House’s good conduct since 1621. It has not done too badly, but how will the committee relate to the new body, and will it have to submit its reports to the regulator for approval? The authority of this House in regulating its procedures is not subject to interference by the courts. What will the status of the new regulator be, and is there a risk that inquiries will take longer, that conclusions will be less secure and, worst of all, that procedures may become tied up in legalism and open to challenge in the courts? These matters deserve careful consideration if we are not to end up with a more complex and costly system than we have now.

Finally, can the noble Baroness expand on the next steps that the Government plan? Will there be a Green Paper or a White Paper? What is the timing for legislation? Will she accept that all of us have a duty to restore the good name of Parliament and that, in doing so, we must also maintain and develop its existing strengths?

My Lords, in following the noble Lord, Lord Strathclyde, perhaps I can save the House some time by briefly saying that my party leader is wonderful too and that he, too, had a lot of good ideas. However, I follow the noble Lord in thinking that, in looking at the Statement and what follows it, it is very important that we see the distinctive position of the House of Lords and that we do not just find ourselves as an afterthought to decisions being made down the Corridor.

There is a public mood that demands urgency and we certainly should respond to it, but in looking at the parliamentary standards authority, it is worth remembering that the Standards Board for England, which looks over local government, has not always been universally praised on carrying out its mandate. In appointing an overlord group, we have to be careful about the powers and relationships. Looking at it at first blush, particularly down that end of the Benches, are we really talking about the end of self-regulation for this House? As the Daily Express used to say, “I think we should be told”.

It is also interesting that in the paper itself a distinction is made that the new standards authority will in the Lords investigate alleged abuses of the system and recommend any necessary sanctions, but for the Commons it is clearly pointed out that any such recommendations would be a matter for the whole House. Even at that stage, we see slight differences in nuances between what the Commons sees as its responsibilities and what is likely to be imposed on us.

On a wider matter, how much of this will be in the new Constitutional Renewal Bill, and when can we hope to see that? Finally, does the Lord President now accept that the Statement and the related matters surrounding it put the idea that we can postpone Lords reform into the next decade, which is the Labour Party’s policy, or the third term of a Cameron Government, which is the Conservative Party’s policy, quite in the realms of unreality? Surely the time has now come to use the last year of this Parliament to put the wider issue of constitutional reform firmly on the agenda and for the Prime Minister to redeem his early promise on a Constitutional Reform Bill by putting it at the front of the Government's legislation. They can deal with the economic crisis without legislation. The legislative time is there for a radical programme of constitutional reform, and the Government should take this opportunity.

My Lords, I thank the noble Baroness the Leader of the House for repeating the Statement. While any and every mechanism to increase transparency and accountability is clearly to be welcomed, I, many Cross-Benchers and—I suspect—many others in your Lordships’ House, have some concerns about the measures set out in the Statement.

As has been said, the House of Lords is a separate legislative body with quite different roles and procedures reflecting its scrutiny role. The body to be set up, admirable as it is, might not be the appropriate one to oversee the work and conduct of this House. That is doubly so, as noble Lords have already said, in view of the agreement reached yesterday by the authoritative House committee to set up its own external and independent review on allowances. In addition to that decision, the House has not been slow in setting up another body, the Leader’s group, thoroughly to review the code of conduct as it applies to the very different procedures of the House of Lords. The remit of those groups is to put forward options for the House committee to consider.

Therefore, I ask the noble Baroness the Leader of the House to convey a message from the Cross-Benches, at least, as to the desirability of seeking some kind of compromise solution whereby the parliamentary standards authority will receive reports from the House of Lords but not be directly involved in regulating it. I am somewhat encouraged in that view by the small but apparent contradiction in the Statement that although the tasks of this new body are clearly stated, it also includes the sentence:

“It is clear that extensive work and consultation will be necessary in order to ensure the agreement of the House of Lords to the effective transfer of responsibilities to the new body”.

I feel that to hand over regulation of this House may be too hasty and a precedent too far.

My Lords, I am grateful to the three noble Lords for their broad support for the Statement which I repeated just now. I should say to the noble Lord, Lord Strathclyde, that it is true that Mr Cameron has been brooking no wrongdoing, but the Prime Minister has also been very firm in dealing with the members of my party who have breached the rules.

The noble Lord, Lord Strathclyde, also mentioned a general election—something that I was expecting, as his party seems to be focusing quite extensively on that at present. Now is not the time to have a general election. It is Parliament that got us into this mess—parliamentarians of every party—and it is the responsibility and the duty of parliamentarians to clean up this mess before we go to the country on the subjects and issues that are important to it.

The noble Baroness, Lady D’Souza, and the noble Lord, Lord McNally, mentioned that the two Houses are different and that therefore it seems difficult, if not inappropriate, to have one regulator. Yes, we have one Parliament but two Houses of Parliament, so it is entirely proper to have one regulator and two systems. At the moment, we do not have all the meat on the bones of these proposals. These proposals will come before Parliament, so ultimately Parliament—we, sitting in this Chamber—can determine what this body will or will not be responsible for. I assure all noble Lords that in Cabinet I am very proud to be the voice of this House. I always strive to ensure that people understand the differences between us and the other place and that we are not an afterthought, although sometimes that is quite a task.

This is a large-scale and significant change, but, as I say, it is for Parliament to decide on that change. The noble Lord, Lord McNally, and the noble Baroness, Lady D’Souza, mentioned the groups that are being set up. One will look at expenses. The other is the Leader’s group. That has not been announced yet; there will be a Statement on that tomorrow. It is terribly important that the work of these two groups continues, because it will form the basis of whatever happens in the future. The Statement says that the new body will be responsible for,

“administering and regulating the system for Peers’ allowances”.

It does not say what that system should be; it says that it will administer and regulate. It also says that it will be responsible for overseeing the code of conduct, not making it. That is terribly important.

A move to an independent regulator would affect many areas of the House of Lords’ work on regulation, but the practice of self-regulation, such as the conduct of business in this House and the way in which this House manages its own affairs in the Chamber, will not be affected in any way. It simply will not be affected.

Issues such as the Committee for Privileges involve extremely important details, but it is far too early to say what those are.

How much will be in the Constitutional Renewal Bill? There is a discussion at present on how this legislation will come forth and in what form, and I am sure that that will be a matter for discussion with the other parties. As soon as I can give noble Lords further information, I will certainly do so.

I should say to the noble Lord, Lord McNally, that I appreciate that there is quite rightly much talk at the moment about constitutional renewal. We are in a constitutional crisis, I believe, but on the doorsteps people are more interested in health and education than in the constitution. However, that is almost a personal comment.

The noble Baroness, Lady D’Souza, suggested that it would be appropriate for the parliamentary standards person to receive reports but not to regulate. The person will be responsible for regulation, but we must clarify that when we come to the details.

I think that I have answered most of the questions that have been put to me so far, and I look forward to questions from other noble Lords.

My Lords, does the Lord President not accept that Parliament cannot delegate its own responsibility for its own behaviour to any authority? If it tries to do that, it will simply further undermine public trust in itself. Does she not also recognise that, for too long, our democracy has lacked the bracing armature of a written constitution? The flexibility of our political conventions and the archaic justifications of inadequately accountable executive power are leading our country on a long, winding, downward path. Despite what she says about the doorsteps, the public are very well aware of that. We can and must arrest that decline with a careful, comprehensive and popularly endorsed programme of public political reform.

My Lords, I hear what the noble Lord says about a written constitution; such views are long held by many Members of this House, and are things to be discussed. A written constitution is not on the table, but many issues relating to the constitution are in the forthcoming Constitutional Renewal Bill. The noble Lord is absolutely correct to say that Parliament cannot delegate responsibility for the behaviour of Members of either House. We are all responsible for ourselves, and we see from their behaviour that some Members of Parliament have let themselves down. However, in some cases the system is also at fault.

My Lords, I ask the Leader of the House to look specifically at the Statement made by the Chairman of Committees last night and give us some greater guidance about how the new,

“independent external review of the financial support available to Members of the House”,—[Official Report, 19/5/09; col. WS 112.]

relates to the announcement that has just been made. What is the timescale for the exercise? Who will appoint the external adviser? Who will give the remit to the external advice process? What will then be the relationship back to your Lordships' House? As we all know to our cost, it is not the advice that is important but the action taken on that advice. Indeed, the other end of the building would not be in the sorry state that it was if successive Governments had taken the independent advice on the remuneration of their Members, instead of constantly putting it on a back burner and allowing the allowance system to take over instead. What will be the relationship between the advice given by the PSA, as I suppose that we will have to call it, and the exercise being set up by your Lordships' House?

My Lords, yesterday’s decision was taken by the House Committee. That committee will decide the process and procedure—very shortly, at its next meeting in June—on the basis of a paper from the Clerk of the Parliaments. However, I assure noble Lords that this House will be kept informed throughout and will be part of that process. As I mentioned earlier, the work of that new small body is extremely important, because it will relate to us as we are now. The new regulatory body will simply be there to administer and regulate, but it is up to us in this House how to take the new small body forward and whether we accept whatever proposals it might come forward with.

My Lords, the Statement on the parliamentary standards authority arises from the discussions yesterday by the leaders of the various political parties in the other place but, as has been mentioned, it has an impact and effect on the House of Lords. Were any of the groups in the House of Lords involved in that decision? Especially, was one of the largest groups in this House—the Cross-Benchers’ independent group—invited to be involved?

My Lords, yesterday, my right honourable friend the Prime Minister had discussions with Mr Clegg and Mr Cameron. I had a brief discussion with the noble Lords, Lord Strathclyde and Lord McNally, and the noble Baroness, Lady D’Souza.

My Lords, this House has not decided. The decision has not yet been taken. This proposal has been agreed to in essence by the party leaders, but there will be a legislative process. Therefore, in due course, it will be up to this House to say whether it wishes to have this new regulatory body.

My Lords, Sir Christopher Kelly’s committee is still due to report in the autumn. But am I right in thinking that if its recommendations do not include or are not based on a new parliamentary standards authority, they will be of no worth?

My Lords, as I understand it, the proposals of Sir Christopher Kelly’s committee will not relate to an independent regulator. Whatever proposals Sir Christopher puts forward will be implemented by the new regulatory body.

My Lords, is it not ironic that the other place, which took such an interest in reforming this House—a House largely made up of people of vast experience who in life have done a real job before they have come here—has found a fall guy in Mr Speaker as far as this hiatus is concerned? Is it not time that the other place looked at the initial deceit from which the problems were derived; that is, the deceit that said that Members of Parliament are worth half of what a GP is paid, but that a trough would be created into which people could put their snouts to make up the deficit? That was a dishonest basis on which to expect the other place to function.

Will any regulatory body understand the complexities of a House like this with experienced people, vis-à-vis the other place where a large proportion are boys and girls sent to do men’s jobs—people without experience and without having made their way in life?

My Lords, I feel rather old, if “them down there” are boys and girls. It would be inappropriate for me to speak of whatever happened at the other end. However, I agree with the noble Lord on one point. It is widely agreed that the system—whereby salaries down the other end were not put up as the SSRB recommended and, instead, there was a system of allowances—was enabled to implode. I am utterly confident that the new regulator will understand the needs of this place because we will ensure that we tell him or her of our needs.

My Lords, I thank the noble Baroness the Leader of the House for her Statement. I should like to reassure the House of the continuing support and prayers of the Lords spiritual. Is the noble Baroness aware that over the past few months we have been affected, as have others, by the challenges to the integrity of both Houses, for different reasons? In terms of exercising our role in this House, the Lords spiritual clearly hold dearly to the principles that bring us and others here. We know that there are those who are being tarnished by guilt by association.

We want the noble Baroness to be reassured of our continued support. Is she aware that we hold ourselves in readiness to be of whatever service we can to ensure that we can restore such as needs to be restored in order that this House and this Parliament can be of service to the country in such a way as we all wish and desire it to be?

Is the noble Baroness aware of that wonderful comment by that illustrious political commentator, Groucho Marx, who said:

“Politics is the art of looking for trouble, finding it everywhere, diagnosing it incorrectly and applying the wrong remedies”?

I think I can say on behalf of the Lords spiritual that today’s Statement goes some way towards not only diagnosing the situation correctly but also applying the right remedies. I thank the noble Baroness for the Statement and ask her to bear us in mind when it comes to being of service to her and others as the future unfolds.

My Lords, these are turbulent times for us all. We are all grateful for the support and prayers of the Lords spiritual. I am confident that with this new independent parliamentary regulator, we will be assisted in diagnosing the right remedies.

My Lords, speaking as an honorary prelate, I suggest that it would be sagacious and acceptable to noble Lords of all persuasions to move on to the next business on the Order Paper.