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Lords Chamber

Volume 751: debated on Wednesday 15 January 2014

House of Lords

Wednesday, 15 January 2014.

Prayers—read by the Lord Bishop of Newcastle.

Shipping: Passenger Safety

Question

Asked by

To ask Her Majesty’s Government what assessment they have made of the impact on passenger safety of their application to the Committee on Safe Seas and the Prevention of Pollution from Ships for exemption for certain ships and areas of operation from European safety requirements in order to substitute life rings for life rafts.

My Lords, Her Majesty’s Government require all vessels to carry enough life rafts to meet the risk to those on board in an emergency. The proposal submitted to the Committee on Safe Seas and the Prevention of Pollution from Ships is based on UK regulations for domestic passenger ships and is supported by the department’s formal safety assessment of domestic passenger ships carried out between 2002 and 2004 in response to Lord Justice Clarke’s formal inquiry into the “Marchioness”/“Bowbelle” collision.

I am grateful to the noble Baroness for that response. My understanding is that this exemption application applies to passenger ships with up to 130 people on them, which, under directive 2009/45, article 4, allows them to go 15 miles from the place of refuge or five miles from the coast in the summer. The idea is to reduce the number of life rafts to the maximum number of passengers—not allowing, of course, for the fact that you cannot always launch life rafts if a ship is heeling—and to replace the rafts removed with life rings. Does the Minister really think that it is a good idea for people who might be wrecked in an accident in the North Sea or off the Hebrides to have to get into a life ring rather than a life raft?

My Lords, my understanding is that this exemption is for up to five miles and therefore would not apply in most of the circumstances that the noble Lord has just described. It is for small craft of less than 24 metres which have to be travelling in daylight and in summer only. They are required to have sufficient life rafts for all passengers but additional safety can be provided by buoyancy apparatus.

My Lords, are life rafts generally not preferable to life rings, particularly if the water is cold? Is the saving in this negotiation really significant? Presumably all existing vessels already have the current requirement rather than the reduced one.

My Lords, there is clearly some confusion. The EU directive was designed for the large, steel ferries that I think noble Lords are referring to. These are small craft. Existing small craft already have this exemption; it is simply as they are replaced that newer craft can have the same exemption. The rationale is simply that on a very small boat there is very little space for adding one additional life raft, which is what would be required by the directive. You would have to take off passengers. These are usually small, family operations operating on a tight financial margin and, as I say, it is within five miles of the coast so that if something untoward were to happen, modern life rafts are very reliable and air-sea rescue is very close at hand. Therefore, the marginal benefit is considered very marginal.

My Lords, I am rather exercised by the fact that Britain over the past 100 years has had the reputation of giving leadership in the International Maritime Organisation, which is across the road there, with the highest standards in world shipping. I am trying to think of the read-across of this to the Philippines archipelago, to Indonesia and so on. Two very brilliant new books on seafaring that have just come out show that many safety standards are now deteriorating. Will the Minister give an assurance that, within the IMO and elsewhere, the British Government will continue to listen to the problems of workers on seagoing ships and that the Government’s contacts with the employers will be equally matched by their contacts with the trade unions?

My Lords, the UK has been an absolute leader in marine safety and I can guarantee that this Government will continue to be. I will ask about various discussions that are taking place with the IMO and other stakeholders, and make sure that we write back to the noble Lord.

Is the Department for Transport involved in any studies looking at lessons learnt from, for example, the “Costa Concordia”, and at the inability to launch lifeboats and life rafts at excessive degrees of heel?

My Lords, I do not have the answer to the noble Lord’s question but I will obtain it. I want to make it very clear, however, that the exemption being sought is not for a boat like the “Costa Concordia”. We are talking about something much smaller in benign waters very close to shore.

My Lords, is not this application one of a number which have arisen from the formal safety assessment by the Maritime and Coastguard Agency which I as a mariner regard as entirely practical?

The noble Lord is exactly right. I think that this is regarded by almost everybody as a practical, reasonable and sensible measure. It has withstood over many years a reputation of providing sufficient safety in the relevant circumstances.

My Lords, what would be the comparative rates of survival for the two methods, life rafts and life rings, in cold winter water around our northern coasts?

I assure your Lordships that this standard could not apply in winter weather; it is for summer only. It is for boats that are very close to the coast and for small excursion vessels. It is part of an appropriate safety regime to look at how the vessels are being used and to make sure that safety is appropriate to that rather than circumstances in which they cannot be used.

My Lords, may I invite the Minister to reconsider her reference to benign waters? Very often, waters that appear benign can rapidly become less benign, and lifeboats are not available at close proximity all along the coast. Can we make sure that if we are erring, we are erring on the side of safety?

I can assure your Lordships that, from a UK perspective, this measure meets a very high standard of safety. Both the safety required of the boats themselves and the quality required of the life rafts have been very closely examined. I have learnt in this House that the word “benign” can be wrongly used, but I think that these are generally benign waters.

My Lords, the Minister is still trying to convince the House that there is virtue in pitching British safety standards below the minimum of European safety standards. Why on earth should that be done unless it is just some doctrinaire response to Europe?

Perhaps I may explain, because I think that there is some confusion here. The EU directive which would require an additional life raft is not intended for this kind of vessel; it is for steel vessels and for large-scale ferries, so it does not apply to most of these craft because typically they are fibreglass, and so on. We want to be sure that we are getting an appropriate exemption for future replacement of existing craft. As I said, the EU directive is not intended to deal with this kind of craft; they are expected to be handled through an exemption process.

Employment

Question

Asked by

To ask Her Majesty’s Government what assessment they have made of the number of people in full-time employment in the United Kingdom.

There are more people in work than ever before. The latest figures show that we have reached a record high employment level in the UK, with more than 30 million people now in work. Three in every four workers—about 22 million people—are in full-time employment. In the past year, the number of people in full-time work has risen by 460,000. This represents 95% of the increase in total employment in the UK.

I thank my noble friend for his response. These figures are very good news. Work represents the greatest way for people not only to escape poverty but for most of us to realise our potential. What are the Government doing to ensure that all groups benefit from this employment boom, not least young people and disabled people?

My noble friend is right to concentrate on specifics, and I am happy to assure him that we have campaigns to get the disabled into work. We have just launched the two-year Disability Confident campaign for employers, and in December we issued the disability health employment strategy. As for youth, I am pleased to be able to say that JSA for youth has now fallen for 18 consecutive months. The number of young NEETs is the lowest for a decade. We have 1.5 million apprenticeship places. The key measure that I have used in this House before is the number of young out of work and out of education, which rose under the previous Government, even though we had the biggest boom. We have now got it under control and it is beginning to fall. The number is now down by 100,000 since the election.

My Lords, is the Minister aware that quite a few people in full-time employment are in jobs below their qualifications and abilities, so the figures need to be looked at more carefully? Much more to the point, is he aware that if we look at the present state of the British economy, to cite that great liberal economist John Maynard Keynes, it is nowhere near full employment and the Government’s policies will never get us there?

My Lords, the leader of the Labour Party said in 2010 that we had a programme that would lead to the loss of 1 million jobs. In fact, we have had a programme that has led to an increase of 1.2 million jobs. We have the right policies to get this country back on the move.

My Lords, whereas it is quite clear that the headline unemployment figures are welcome, there is a problem about emerging underemployment and intermittent hours. While we are waiting, with more and more impatience, for the arrival of universal credit, which in due course will help, will the Minister do all he can to encourage people to take advantage of the existing in-work benefits, which can help employees get into full-time, sustainable jobs? While he is at it, will he do his best to try to tone down the Government’s anti-welfare rhetoric, which indiscriminately and unfairly seeks to caricature every social security claimant as either a scrounger or a cheat?

My Lords, as my noble friend is fully aware, we are introducing a programme to blend the out-of-work benefits with the in-work tax credits. That is vital because it gets rid of that distinction and makes a smooth transition from being out of work to being in work. That is a vital reform which, as my noble friend knows, I am pursuing with all my energy.

Is the noble Lord able to say when the Government expect unemployment to fall to the level of 7% and we can expect to see interest rates rising again?

My Lords, that is, of course, a reference to the Bank of England’s target of 7%. Unemployment has been falling pretty dramatically: it fell 0.3 percentage points to 7.4% in the latest three-month period. It is not the job of a government Minister to predict when unemployment will hit any particular rate; all I can say is that these trends are immensely encouraging. We should all look for them to continue to improve and I have no doubt that they will.

Bearing in mind his first Answer, can the Minister tell us what discussions there are in government about the relative economic merits of raising the minimum wage?

There are two distinct factors. The higher the minimum wage, the more people will not go into the market. Estimates show that if we were to go with the recommended living wage, we would lose 300,000 jobs, particularly among youngsters. On the other side of the argument, there are benefits in terms of pay, particularly for the Government, because—as my noble friend mentioned—the tax credit system boosts the pay of low-paid people. That is the balance of the debate.

My Lords, the Minister will be aware that there are still significant regional differences in unemployment levels in the UK. Can he tell us what regional policies the Government may have in mind to help the situation in areas such as the one where I live, in the north-east of England, where unemployment levels are still in double figures?

My Lords, I was encouraged, as other noble Lords will have been, to hear the very optimistic remarks about what is happening in the north; namely, that it is outpacing London at this particular time. Let us hope that that is and remains the case.

Taxation: Fuel Duty

Question

Asked by

My Lords, the Government have taken substantial action to support motorists with the cost of living while reducing the budget deficit. As a result of this Government’s action, fuel duty will be frozen for the remainder of this Parliament, which will result in pump prices being 20p per litre lower than under previous government plans by 2015-16. The Government must exercise flexibility to target tax support where it is most needed. The Government will continue to review fuel duty in the context of all taxes and the public finances.

My Lords, I thank the Minister for that encouraging reply. Is he aware that in upland, moorland and less favoured areas, such as where I live in the Peak District, the ownership and use of a vehicle—let alone a four-wheel drive vehicle—is a necessity and not a luxury. That therefore causes those communities to have problems with fuel prices, which are a very significant component of their viability. Will Her Majesty’s Government make every possible effort in the future to assist those areas in terms of cost of fuel?

My Lords, the policy that we have already adopted will assist people in those areas, as it will everywhere else. We are looking at the scope for extension of the rural fuel rebate scheme, which gives an additional 5p rebate in the most sparsely populated areas. We hope to be able to make an announcement of that in the relatively near future.

My Lords, the Question on the Order Paper asked the Minister a simple question. Should not his answer have been no?

No, my Lords. The noble Lord knows better than anybody else that it would be foolish to set out at this point firm plans for individual taxes for the course of the next Parliament.

Has my noble friend noted that the price of petrol in the petrol stations varies up to 3p within a few miles, and sometimes more? Does he realise therefore that if people are able to pay the extra 3p rather than going to a cheaper place, that suggests what the economists call a bit of a consumer surplus since they are prepared to pay extra? What is the cost to the Exchequer of this reduction? First, I think that it was £400 million for this year but what will it be by the end of the Parliament? Secondly, is it really the best way of spending public money, given all the other demands on the Exchequer?

My Lords, the Government will have eased the burden on motorists by £22.5 billion over the Parliament to 2015-16. The kind of differential that my noble friend describes in a small area is a classic example of a competitive market operating. I am told, although I do not have one myself, that if you have a certain kind of sat-nav it will automatically tell you the price of petrol at petrol stations in your vicinity at the time, which is a very good way of facilitating the market working.

My Lords, the Minister will however recognise that the Chancellor, through his VAT increase, increased the price of fuel by 3p. Why do the Government not go further and introduce a price freeze on domestic fuels?

My Lords, it is true that the effect of the VAT increase ate into the benefit but the price is still 10p less than it would have been, even taking the VAT increase into account. I am not sure whether the noble Lord supports that policy but that is a very considerable net increase. As far as domestic energy prices are concerned, the noble Lord knows that his party’s proposed policy is nothing more than a gimmick.

Arising from the question asked by the noble Lord, Lord Marlesford, about what economists call consumer surplus, is the Minister in agreement with the official data of the ONS that hydrocarbon taxes are the most regressive taxes in the country? In other words, they show that the lowest-paid pay—I think—four times more on petrol, as a percentage of their income, than the top decile. There is therefore a distinct impact on poverty, as was implicit in the original Question.

Education: Academy Chains

Question

Asked by

To ask Her Majesty’s Government what controls are in place on the disbursement of public funds by academy chains to their directors and trustees or private contractors linked to them.

My Lords, the relevant rules that academies must abide by are quite clear and have been considerably tightened under this Government. No individual or organisation with a governing relationship to an academy can make a profit; any goods or services delivered by these parties to these academies must be delivered transparently and at no more than cost; and proportionate and fair procurement processes must always be followed. As charities, academies are required to adhere to accounting standards. These require the full disclosure of related-party transactions, and independent auditors check those disclosures every year. Unlike local authority schools, academies produce and publish annual third-party audited accounts.

My Lords, I thank the noble Lord for that reply and of course I accept that the accounts of these firms are audited. However, is the Minister concerned by reports of excessive sums of taxpayers’ money being paid to academy chain directors for travel, subsistence, consultancy and legal services? Is he also concerned that many of these businesses are employing members of their immediate family to provide services for the academies, and does he accept that academy chains lack the involvement of parents and the local community, which could provide a degree of independent scrutiny and governance for the academies? What more is his department planning to do to get a grip on the situation, which seems to be one of prioritising the expansion of the academies over the protection of public money?

I stand by my original Answer regarding the rigid regime that academies operate under, and resent any allegation that we do not have a grip of the situation. When we came into the Department for Education in May 2010, we found a department with, frankly, a very poor understanding of value for money. Since then, we have halved the cost of building schools under the previous Government; by 2015 we will have cut the cost of running the department by half in real terms; we have slashed the amount of money spent on sponsored academies from an average of more than £300,000 under the previous Government to under £100,000; and we have substantially tightened the rather loose arrangements that the previous Government had in force in relation to these arrangements. I stand by the results of the academies. Sponsored academies open for three years improve their results by 12% versus 5% at secondary level, and primary converter academies are far more likely than local authority schools to be rated outstanding at their next Ofsted when they have previously been rated good.

My Lords, did my noble friend have the opportunity over the Christmas Recess to read the interview in the Times given by our noble friend Lord Harris of Peckham about the huge success in transforming the lifetime chances of youngsters in this country? Would a responsible Opposition not be asking why we are not getting value for money like that from local authority schools, which are cheating a generation of those opportunities?

I entirely share my noble friend’s sentiment. We should be praising philanthropists like my noble friend Lord Harris and encouraging more of them into the academies programme, as we are attempting to do. In 2013 the Audit Commission carried out a survey of annual detected fraud and corruption within local authorities and reported 191 cases of fraud in schools. My department is considering what we can do about improving procedures in local authorities in relation to this.

My Lords, what are the arrangements for the trustees and directors of these companies declaring their interests?

My Lords, it is absolutely clear that both trustees and directors of these companies must declare their interests in the accounts.

My Lords, does my noble friend agree that the most important form of accountability is the accountability of the school to its pupils, and their parents, to raise the standards of achievement? The huge success that my noble friend has already described is surely evidence of the success of the accountability that has left academies accountable to their pupils to raise standards.

I agree entirely with my noble friend. The sixth largest economy in the world cannot tolerate a system whereby our schools are rated in the 20s for developed countries. That is what our reform programme is all about improving.

In replying to the Question, the Minister was trying to be very reassuring. Does that reassurance extend to a circumstance where a charity or an academy chain, having taken over the running of a school, then decides to dispose of property attached to it? Do the proceeds from that property go back to the school or do they accrue to the academy chain or charity?

The noble Lord asks a very good question. In just about every case—if I can find other cases that are relevant to this answer, I will identify them for him—the land stays with the local authority, with a 125-year lease to the academy, so the circumstances that the noble Lord refers to are unlikely to apply. Certainly, nothing like what he mentioned could possibly happen without the consent of the Secretary of State.

My Lords, I declare a personal interest as a sponsor of Grace Academy, which has featured in recent articles. Is the Minister aware that many sponsors have put multiple millions into the academy programme rather than taking funds out?

I share my noble friend’s sentiment entirely. I am fully aware of that. I am extremely grateful to him for his support of the academy programme and, as I said earlier, we should encourage more philanthropists like him to come into the system, rather than trying to score cheap points against them.

My Lords, does the Minister agree that, while there is a full-blooded debate to be had about the relative merits of academies and schools that have some local authority involvement—a debate that I suggest will have its full import when we have rather more evidence from the academies than we have at the moment—it does not do anybody any good to castigate those schools that are not yet academies and whose results are manifestly brilliant and would hold any academy’s results to shame? Can we have some assurance that the language we use is not polarised in a way that damages schools in the public sector?

I agree entirely with the noble Lord. Many schools that are highly successful are not academies. The noble Baroness, Lady Jones, recently took me to visit Morpeth School in Tower Hamlets, which is an excellent example of a non-academy, highly successful school.

Who are some of these academy chains responsible or accountable to? For example, the Academies Enterprise Trust has grown to the size of a local authority. At least local authorities are accountable to the electorate. Who is AET accountable to when it has more than 60 company directors on more than £60,000 a year?

All academy chains have a rigid financial reporting system. They have to publish their accounts and are actively and rigorously monitored by my department. I assure the noble Baroness that we keep a keen eye on all the academy chains.

My Lords, the noble Lord, Lord Forsyth, referred to raising standards for all children. If the schools that the Minister is talking about are so good, why do not any noble Lords opposite send their own children—or more likely, their grandchildren—to those schools, as many of us did, because we felt it was our responsibility to be supportive of local schools?

I believe that a number of noble Lords do send their children to such schools, and I hope that in time, because of the success of the entire state programme, many more will.

My Lords, bearing in mind the history curriculum that is taught in academy schools, does the Minister agree with his Secretary of State, who wrote in a recent article that those on the left were unpatriotic?

Draft Modern Slavery Bill Committee

Membership Motion

Moved by

That the Commons message of 9 January be considered and that a Committee of seven Lords be appointed to join with the Committee appointed by the Commons to consider and report on the draft Modern Slavery Bill presented to both Houses on 16 December 2013 (Cm 8770) and that the Committee should report on the draft Bill by 10 April;

That, as proposed by the Committee of Selection, the following members be appointed to the Committee:

B Butler-Sloss, Bp Derby, B Doocey, B Hanham, B Kennedy of Cradley, L McColl of Dulwich, L Warner.

That the Committee have power to agree with the Committee appointed by the Commons in the appointment of a Chairman;

That the Committee have power to send for persons, papers and records;

That the Committee have power to appoint specialist advisers;

That the Committee have leave to report from time to time;

That the Committee have power to adjourn from place to place within the United Kingdom;

That the reports of the Committee from time to time shall be printed, regardless of any adjournment of the House; and

That the evidence taken by the Committee shall, if the Committee so wishes, be published.

Motion agreed, and a message was sent to the Commons.

Joint Human Rights Committee

Membership Motion

Moved by

That Baroness Buscombe be appointed a member of the Joint Committee in place of Lord Faulks, resigned.

Motion agreed.

Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Bill

Report (2nd Day)

Relevant documents: 3rd Report from the Constitution Committee.

Clause 26: Meaning of “controlled expenditure”

Amendment 34

Moved by

34: Clause 26, page 12, line 45, at end insert—

“unless the expenditure relates to legislation before Parliament during the regulated period”

May I assist the noble and right reverend Lord, Lord Harries? We allow some latitude, of course, at the beginning of any stage when Members are exiting the House in some large number, but may I advise any other Peer who leaves that they should not walk in front of the person who is moving the amendment? It was impossible for those on the Front Bench, who were listening to the noble and right reverend Lord, Lord Harries, even to hear the first word. I am sure that the noble and right reverend Lord, Lord Harries, may now wish to resume.

I thank the noble Baroness very much.

Before I focus on the first amendment in this group, I thank the Minister for responding to a good number of concerns raised by the commission which I have the privilege of chairing. He has responded to quite a lot of our concerns, in particular, I note, with government Amendments 41 to 44 in this group, which we are glad to see. All these issues were mentioned in the second report of the Commission on Civic Society and Democratic Engagement. The government amendments deal with issues of safety and security, particularly in Northern Ireland, extra expenses due to disability and travelling expenses, and they take out the time of volunteers. They also include translation from Welsh to English, although I note that the noble and learned Lord, Lord Morris of Aberavon, has his own amendment to include production costs as well as translation costs, and I hope that the Government will look sympathetically on that. I am very grateful on behalf of the commission to the Minister; he has taken a lot of trouble to listen.

However—and it is a big however—there remain a significant number of concerns, on which we are hoping to have a positive response from the Government. I have in my hands a petition which was started only last Thursday by the commission and, since then, has gained the support of more than 130 NGOs and 160,000 signatures from charities and campaigning groups that are still concerned about the effect of the Bill on the workings of our democratic society.

Briefly, the amendment of the noble Lord, Lord Tyler, is about the distinction between the general public and supporters. The commission put forward an amendment to try to widen out the definition of a supporter because, in a digital age, a supporter cannot simply be considered as somebody who gives money to a charity. As that petition indicates, with its 160,000 signatures, the term “supporters” now has a much wider character. Although the Government did not accept the amendment which we tabled earlier because they thought it was too wide, I hope that they will look sympathetically at that of the noble Lord, Lord Tyler.

To focus specifically on Amendment 34, my amendment concerns legislation before Parliament during an electoral period. It is absolutely fundamental to the healthy working of democratic society that people should be able to campaign quite freely, without being inhibited by too much regulation, against legislation that is going through Parliament during the electoral period. I was disappointed that the Electoral Commission, which has been helpful at a number of points in supporting our amendments, does not support this one in its latest briefing. I will examine its arguments as to why not.

The Electoral Commission says that, if the amendment were allowed, it would allow unlimited spending on what may promote or procure the election of any particular candidate or party. Secondly, it suggests that the range of topics is potentially wide, even if it is covered by primary legislation indicated by the Government. Let us take an example and test that out. In election year, the Government decide to start legislation for, let us say, a new town of 500,000 people not far from an area of outstanding natural beauty. This policy is strongly supported by the Government of the day, but is opposed by the two other parties; it is a highly political issue. Furthermore, the town will actually cover three constituencies where there is a narrow majority.

Surely people ought to be able to campaign either for or against that quite freely without an excessive regulatory burden, even during an electoral period. Otherwise, think what would happen. The Government could save their most controversial legislation until the beginning of the electoral period and bring it forward then, knowing that the opposition to it would be more muted than if it were outside the electoral period. We must remember that one year in five will be an electoral period. This will severely hamper and inhibit the proper workings of our democratic society.

I look to the Minister to see whether it might be possible to include on the face of the Bill the particular amendment in my name. I beg to move.

My Lords, I am grateful to the noble Lord, Lord Gardiner of Kimble, for the unfailing courtesy in the discussion that we had on my amendment. When I moved a similar amendment in Committee, with the support of a number of my noble friends and no one dissenting, I said that I hoped that I and all of us concerned with the status of the use of the Welsh language had nothing to worry about. Now the Government have tabled Amendment 44, which includes such provision in new paragraph 1A(1)(b), and I welcome that as a very important step indeed.

Given the history of the success in ensuring equal validity for the language over the years, I presume the failure to include in the Bill a declaratory statement of the kind now in the Government’s amendment was an unintended omission. I was particularly encouraged by the considered statement of the noble Lord, Lord Gardiner, in his reply to the previous debate, where he stated that,

“the Government believe that the Welsh Language Act 1993 includes an obligation to treat Welsh and English on an equal basis and that there is a strong and compelling case for translation costs to be excluded”—

that is, excluded from the ceiling. He added, with regard to the references that had been made to the history of the language, that,

“the Government will consider how this exclusion would operate and will want to return to this important issue on Report”. —[Official Report, 16/12/13; col. 1093.]

That is what they have done, and I welcome that. Hence my noble friend and I tabled the original amendment, and I am grateful for the support of all who spoke in Committee.

The Minister said that there is “no legal obligation” to translate election material from English to Welsh and vice versa, and that is absolutely right. In reality, however, given the sea change in the use of the Welsh language in Wales, in some parts in practice it would not be possible to make any electoral headway without the use of both languages. All parties in Wales recognise this and implement the public expectation of the use of both languages. Indeed, in my time as a constituency Member of Parliament, this is what happened and many people made representations to me in both languages.

The Welsh Language Commissioner, Meri Huws, was concerned about this lacuna in the Bill and sought my support. The Bill defines “controlled expenditure” to include,

“the production … of material which is made available to the public at large”.

Since the cost of translation of electoral material falls within that definition, the commissioner was concerned that the reduced expenditure would adversely affect the provision of bilingual election material in Wales. Non-political organisations might well choose not to use bilingual election material. That was the issue. The mischief which concerned the Welsh Language Commissioner was the possible inhibition of third parties from issuing bilingual material.

I would argue that the Government have sought to meet our need. You cannot translate anything unless you have an original document. Material produced for the public at large by definition includes the production cost. The bilingual production of the document for translation is a preliminary step towards its publication, so it is totally unreasonable to limit the exception to, for example, the actual payment to the translator, which could be quite small. Following my conversation with the noble Lord, Lord Gardiner, this morning, I hope that the noble and learned Lord, Lord Wallace, who I understand will reply, will give me the assurance I seek that “production” is basically a part of the process leading to the translation. Any other interpretation would put my noble friends, and indeed the Government, in an impossible situation.

Let me describe the situation where I was wrong and the expenditure was confined strictly to the actual costs of, for example, paying the translator. Whereas in England the NSPCC may issue material only in one language, the NSPCC in Wales would be obliged to prepare and translate a similar document in both languages. If the whole costs could not be excluded from the expenditure ceiling, that would certainly inhibit it from doing what it would like to do. If I am wrong—perhaps those advising the Minister will want to consider the reply, which I am sure will be helpful—the mischief of discouraging people from producing bilingual pamphlets and material would still be there.

I hope very much that I can have the assurance that I want. I refer again to what the noble Lord, Lord Gardiner, said in Committee, that the Government want to fulfil their obligations,

“to treat Welsh and English on an equal basis”.—[Official Report, 16/12/13; col. 1093.]

I hope and believe that the legislation should leave this House on as perfect a basis as possible.

Before the noble and learned Lord sits down, can he emphasise that the cost of production includes additional paper and printing as well as the cost of translation? That is the point where his amendment, to which my name is attached, has merit over and above the Government’s amendment. There needs to be clarification that the cost of production includes the extra costs related to having the production in two languages.

Given that the definition I have quoted refers to “production of material”, I assume that that material is included in the definition. You cannot usually translate anything unless you have something on paper to look at, which enables you to translate it. Therefore, this is an initial step in production. I emphasise, for the third time, that the definition refers to,

“the production … of material which is made available to the public”.

My Lords, I very much hope that the comments made by the noble and learned Lord, Lord Morris, will be taken seriously by my noble and learned friend, as I am sure they will be. However, I will direct some very brief comments to Amendment 34, which was moved with commendable brevity by the noble and right reverend Lord, Lord Harries of Pentregarth.

We live in a very different age from people who were active in politics even 20 or 30 years ago. I do not know whether the mass membership political party is a thing of the past or not, but it is certainly not a thing of the present. We live in an age in which single-issue groups and associations predominate and have a collective membership far in excess of the Conservative Party, the Labour Party and the Liberal Democrat party put together. One can illustrate that with one statistic: the National Trust now has over 4 million paid-up members. In this new age, we have to be very conscious of the fact that we should pass no legislation in this House that in any way inhibits the expression of legitimate opinion. The Bill endangers that expression of legitimate opinion.

If ever there was a Bill that cried out for pre-legislative scrutiny, it is this one, but it has not had it. In saying that, I level no criticism at my noble and learned friend Lord Wallace of Tankerness, who has been exemplary in the manner in which he personally has sought to meet and discuss with people who have legitimate concerns and interests. Therefore, I exonerate him from all blame, but I still say to him that this is a Bill that is far from perfect. It is a Bill that should never have been presented in this form to either House of Parliament.

Another thing that makes the present age different from very recent ones is the dynamics of the fixed-term Parliament. Until a future Parliament has the good sense to repeal that Act—which I hope will not be too long distant—the fact is that we know when the next election will be and the election after that and so on. So we have a year of purdah as far as interests groups, charities and others are concerned. The simple aim of Amendment 34 is to try to alleviate some of the problems that that creates.

I very much hope that when my noble friend responds to this brief debate—and I hope that it will be a brief debate because we have a long day before us and many important issues to discuss—he will acknowledge the powerful arguments put forward by the noble and right reverend Lord, Lord Harries, which are supported by many of us. If the Minister cannot give the assurances that we seek, I hope that he will at least give the assurance that he will reflect on this matter, have further discussions and come back at Third Reading, because we need to make this very, very imperfect—no, this very, very bad—Bill a little more palatable than it is currently.

My Lords, I have two amendments in this group. In preparing my notes, I had intended to say precisely what the noble and learned Lord, Lord Morris, said just a few minutes ago. It is the responsibility of this House to try to make sure that anything that leaves us is as good as it can be and as perfect as we can achieve. Today, therefore, we are all together in seeking modest amendments in most cases, but important ones that make the Bill more workable, more acceptable and more democratic.

Before I come to the two specific amendments on which my name leads, I should very much like to support the noble and right reverend Lord, Lord Harries, in his Amendment 34. It is important for the sake of civic society that we enable people to get fully involved in the dialogue with Parliament about the legislation that goes through the two Houses. I hope that, in one way or another, my noble friend will be able to make that absolutely clear. It must surely be right that, when legislation is going through both Houses of Parliament, our fellow citizens are in a position to campaign without let or hindrance to improve that legislation. I very much hope that we will have reassurance on that point.

Amendment 40, which stands in my name and in the names of the noble and right reverend Lord, Lord Harries, my noble friend Lord Cormack and the noble Baroness, Lady Mallalieu, is quite simply about bringing the concept of supporter up to date. I echo here a point made by my noble friend Lord Cormack a few minutes ago. When I was first involved in politics, those of us who wanted to engage in the political process, in the main, joined a political party. I did so as a student and I suspect that many others in your Lordships’ House did the same. Some then drifted off into other occupations. I stayed with politics, to my obvious detriment in terms of income compared with the lawyers in your Lordships’ House. From that period to now there have been dramatic changes in society. Many then did join parties; others might have joined campaigning groups. Some of those groups are still with us and still have a mass membership. In those days, it was very much the culture of the age, particularly among young people, but people today support campaigns à la carte. They do not get involved in just one campaign and stick with it to the exclusion of all others. They are involved for a time but their priorities change, just as in the consumer world people expect now to pick and choose. You go to one supermarket for one purpose and to another for another, to one airline for an outward flight and another to come home again. You do not necessarily feel that you have to join up to one hospital even—you choose. It is part of the culture of our age.

People do not sign up to any one view or any one provider of that view. They certainly do not join one group for fear that doing so would sub-contract their future views on future issues to that group concerned. Yet it is still important in electoral law to make way for groups that communicate with people and who have regular, committed supporters without that being counted as some sort of electioneering. The concept of a committed supporter is now familiar to the Electoral Commission and it incorporates that in its guidance. Amendment 40 seeks to tighten that up and put it into legislative form. In short, we are saying that someone who has given money to an organisation or has directly communicated with it in the past 12 months should be accepted and recognised as a committed supporter.

To be clear, I do not believe, as some have suggested, that everyone who has given Data Protection Act consent to be contacted in future—for ever and always—should be counted as a supporter of that group full time. That surely cannot be practical. I am sure that if Members of your Lordships’ House look at their e-mail inboxes, they will find messages there from all sorts of groups in relation to which at some time we have either ticked or not ticked a box to say that we do not mind if they communicate with us. However, that is not enough to say that we are committed supporters of a particular group. Therefore, I think that our amendment is much more practical. Surely that consent should not be allowed to imply active, ongoing support for the group concerned. However, active participation in a campaign in the past 12 months—not just receiving e-mails but acting on them—is surely a signal of active support. I think it should be recognised as such alongside, and on an equal basis with, financial contributions. As I have said, the existing Electoral Commission guidance is not sufficient because it concentrates too much on donations. Support for an organisation involves much more than simply giving money and we should take this opportunity in this Bill to say so firmly so that in future the guidance is absolutely explicit.

Finally, Amendment 45A in my name makes one very simple suggestion, which I hope will commend itself to my noble friends on the government Front Bench. I do not need to tell your Lordships that the Bill is controversial. It would be reassuring for all those concerned to know that any future alterations to Part 1 of Schedule 3, which is very controversial, cannot simply be made by ministerial fiat. On many occasions in your Lordships’ House we have had the familiar problem of what I think is usually referred to colloquially as the Henry VIII power. It is not appropriate here and I hope therefore that, on the basis of Amendment 45A, that power can in future be subject to an affirmative resolution of both Houses. That would give proper control over that exercise. I accept that that is not something for today but I hope that my noble friends on the government Front Bench will look at it in time for us to consider whether that might be a useful very small addition but one that would give real reassurance to those who are concerned about the future of this legislation. On that basis, I hope that when the Minister responds he can do so positively to these amendments.

My Lords, my name is added to Amendments 34 and 40 in this group, which I support. To my mind, Clause 26 goes to the heart of the damage that the Bill as it stands has the ability to do to free speech, to the right to campaign and to the right to protest. It exposes what I believe was an unintended consequence of a Bill which, as we have already heard, was placed before Parliament in haste and without proper consideration.

Clause 26 has the capacity to prevent any campaigning organisation mounting a major campaign against a Bill before Parliament in the regulatory period proposed —in other words, from September this year to May 2015 and, as others have said, for one year in every five thereafter. If Clause 26, together with the rest of the provisions in the Bill currently proposed by the Government, including today’s government amendments, had been in force in 2005, because of the 60% spending limit reduction and the inclusion of staff costs in the expenditure that has to be accounted for, it would simply not have been possible, for example, to mount rallies and marches on the scale organised by the Countryside Alliance—of which, I remind the House, I am president—all of which took place in what would have been the regulatory period for the 2005 election. I suspect that other major protests, such as the Stop the War march, would also have been troubled by the spending limits.

Although it is defective, PPERA was liveable with because the expenditure limits were set at a level which did not capture the activity of most campaigners and because staff costs did not have to be included in returns. Campaigners were therefore able to live with the legislation. However, this is not so with Clause 26 as it currently stands. As the noble and right reverend Lord, Lord Harries, said, it provides an opportunity for a Government to reserve the introduction of particularly contentious legislation to the year before an election—the regulatory period—knowing full well that opposition will be seriously restricted by the financial limits imposed under the Bill. While I accept that opposition would not be wholly silenced, it would, effectively, be seriously curtailed.

For those who have not followed it as closely as others, political campaigning under the Bill does not necessarily involve campaigning for or against a particular candidate or party. I prefer to call that “Political” campaigning with a capital “P”. Under the Charity Commission’s guidance, no charity is permitted to do that. The Bill goes further and restricts what I call political campaigning with a small “p”: in other words, campaigning on a policy, which is what many charities do. You do not have to make any mention of a particular party or candidate to be caught by the Bill, but you will be if your campaign can reasonably be regarded as intended to promote or secure electoral success, even if it can be regarded as intending to achieve some other purpose too. It does not matter that your campaign is long-standing if it fulfils those criteria. As the Minister has repeatedly said, the test is an objective one. So it is also irrelevant if your intentions, as the campaigner, were solely concerned with the issue and not with the election.

The current guidance of the Electoral Commission suggests that where, for example, one political party allies itself with the campaign of a particular organisation, it does not necessarily mean that the campaign and its material become regulated, but if there is a change in the scale and nature of the campaigning it may well do so. However, what if a party in government introduces a contentious Bill, during the regulatory period, which directly impacts adversely on your existing campaign? How can a campaigning organisation reasonably not draw attention to the fact and campaign vigorously against it? Indeed, why should it not?

Legislation before Parliament will, of course, reach a conclusion one way or another with Prorogation. The campaigning directed at legislation, albeit during the regulated period, is aimed not at the election but at something which will have concluded by election day—indeed six weeks beforehand—with Prorogation. A way must be found to enable the people of this country to express the strength of their feelings about proposed legislation at any time in the course of a Parliament. I hope that the Minister, who has repeatedly said that it is not the Government’s intention to stifle protest, will agree to take the amendment away for urgent discussion with the Electoral Commission and return next week, if not with an amendment to meet this real objection to Clause 26 then at least with an unequivocal indication of guidance to be given to permit legitimate campaigning in these circumstances. As the Minister will know, it is not enough for him to make some form of Pepper v Hart statement in this House because the courts, in due course, will not look at what is said in the debates of this House unless the legislation is itself unclear or ambiguous. The Bill is perfectly clear in what it says in that respect.

If the Minister cannot do either, I regret that we would be better off, for the 2015 election, to continue with PPERA until a proper Bill can be produced and Clause 26 should go completely.

My Lords, I support Amendment 35 in the names of my friend the noble and learned Lord, Lord Morris, my noble friend Lord Wigley and myself. The case has been put clearly and in very great detail by the noble and learned Lord. I am sure that on the only real issue, the Minister could dispel all doubts very easily, as the Government are showing obvious good will for the Welsh language. I was extremely appreciative of the words of the noble Lord, Lord Gardiner of Kimble, on 16 December when he reiterated the point that many of us have made; namely, that the Welsh language is one of the oldest living languages in Europe. It has been spoken for more than 1,500 years.

Would it not be churlish if the whole concession made by the Government were limited only to the fees paid to a translator—that is the issue—and did not include all other costs which are consequential or involved in translation? That clearly was the intention of the Government and, if there is any doubt whatever in the matter, I would like to see them make assurance doubly sure in that respect.

The noble and learned Lord, Lord Morris, speaks with the authority of a former Attorney-General. Indeed, he is clearly of the view that the words in Amendment 44 are wide enough to encompass exactly what is required in this case. However, if there should be any question of dubiety or it is necessary to remove any peradventure of doubt, it seems that it would be an easy matter to cure this small anomaly by Third Reading.

This is a small skirmish in relation to the Welsh language, which has suffered many attacks and anomalies in the 478 years since the Act of Union 1536. The field of endeavour still remains redolent with possibilities. One obvious campaign that will have to be fought some day is in relation to the right of a person in Wales to be tried by a jury in the Welsh language in an appropriate case, bearing in mind that a tribunal of fact such as a magistrates’ court, dealing with 98% of cases, is entitled to do that and does so under the 1967 Act. I hope that such an issue will be raised before too long in this place.

My Lords, first, I thank the noble and right reverend Lord, Lord Harries, for welcoming the amendments made by the Government. He was characteristically generous about that and he gave quite a long list. Secondly, I thank my noble friends for what they have done, despite being incapacitated for a period, in bringing amendments of the scope that there has been in this case. Certainly, I, as a supporter of the Government, have been surprised by the extent to which the Government have agreed to the amendments originally put down.

I take the point made by my noble friend Lord Cormack that the Government were deficient in the way in which they failed to do pre-legislative scrutiny. One has to agree that post that situation, with the pause and with the extent of the amendments that the Government have put down in the past few days, they have responded generously to the points fairly made by Members on all sides of the House.

In his short remarks, the noble and right reverend Lord, Lord Harries, mentioned Amendment 34 in particular. He said that, for instance, if a new Bill came before Parliament during the regulatory period from September 2014 to the general election in 2015, it would be a big issue in any particular constituency and that therefore the Bill would inhibit discussion of the new town in that constituency, which would be wrong.

The point is really not that. Obviously there would be a huge outcry in any constituency if a new town was proposed; there is no doubt about it. Vigorous discussion would take place between the parliamentary candidates during the regulated period and with outside bodies that may be set up to campaign on this issue. Clearly, that would happen. The question is to what extent they would be allowed to finance a campaign about a new town by comparison with what the local political parties could spend in that constituency. Under the Bill they are allowed to spend, in round figures, more or less £10,000 on a campaign over a new town in a constituency during the regulated period. That is roughly the amount.

Frankly, any local party that can raise £10,000 to fight in a local constituency is doing well. I do not think that I ever got as far as that in my constituency of Orpington; it is a lot of money. Local parties are not very affluent these days and do not have many people in them. Many are collapsing from inside. They have few members and great difficulty in raising money. Therefore, £10,000 is a lot of money to inject into a constituency. If it was only that constituency and nowhere else in the country that party members were campaigning, they could inject £300,000.

We are not talking about any restriction on discussion of an issue that is before Parliament in the regulated period; it will be discussed. We are talking about the balance between what a campaign could spend on promoting a particular interest—whether it is for or against the new town—and what the local political candidates could spend. The Bill is about a balance between what local parties can spend, in a constituency and generally, and what lobbying interest groups of this kind can spend—whether they are charities, trade unions or whatever.

I am a member of the Electoral Commission, but I speak for myself on this occasion. The commission is against the amendment in the name of the noble and right reverend Lord, Lord Harries. It said clearly in its briefing to the House before Committee that more proportionate thresholds and spending limits would reduce the need for exemptions of the kind for which he is calling. In effect, the thresholds for regulation—which, I accept, as I said in previous debates on the Bill, were too low—and the spending limits, have been raised by the Government: for example, to £10,000 and to £20,000 for the registration threshold. That gives room for people to campaign on these issues, but not to swamp local political parties, as they are swamped in America, where you get super-PACs swamping the official Republican and Democratic candidates. That is what this Bill is about—a balance between what an interest group can do in a constituency, and what the political parties that are fighting and standing in a general election can do. The Government’s sensible lifting of these limits to meet the fair and correct opposition to the lower limits —which were too low—has done this. The Government’s balance is right.

There is a further point. The amendments to which the noble Lord referred at some length form a package; as he acknowledged several times during our debates, these things are linked. If you make one concession, it has an effect somewhere else. I hope that those who are concerned about the effect of the Bill will realise that this is a complete package, and that by raising the thresholds, the Government have dealt with the points that noble Lords made and therefore that the exemptions they seek are unnecessary. While acknowledging the understandable opposition, in particular of Members on the Cross Benches and in the Labour Party, I hope that they will see that this is a genuine attempt to reach consensus on how elections are conducted in this country. This is now a well balanced set of proposals. Therefore, any further attempt to carry on and unpick them would be disastrous for elections in this country.

My Lords, I join the noble and right reverend Lord, Lord Harries, in thanking the Government for the sensible and welcome amendments that they have tabled. We have just heard from the noble Lord, Lord Horam. I wonder if when he used the word “harried” he meant someone who had been harried by the noble and right reverend Lord, Lord Harries, but I will leave that to one side.

However, we feel that more changes are needed to the Bill, which we have opposed from the start, for the very cogent reason spelt out by the noble Lord, Lord Cormack: it inhibits the expression of legitimate opinion. Amendment 34 goes to the heart of that. The noble Lord, Lord Horam, spoke about constituencies, which I think is a different issue, but we might be talking about something like the bedroom tax, which the National Housing Federation campaigned against, worried about the rents coming to it. Anyone who followed the Welfare Bill will know all the detail of that, so I will not go through it. Unless we can get rid of staff costs—which I hope we will within the next hour—had the bedroom tax been in the past 12 months, it is very unlikely that the National Housing Federation, which is not a charity, would have been able to campaign in the way that it is telling us its members wanted. That was not in the past 12 months but something like that could have been.

This is legitimate campaigning. Although we have heard statements from Ministers that it was never the intention of the Government that that type of activity would be within the scope of the Bill, I think all of us feel that despite good—or bad—intentions, that is not a sufficient safeguard and clarity should be provided in the Bill along the lines spelt out in Amendment 34.

My Lords, first, I thank those who have contributed to this debate, in particular those who have welcomed the government amendments. We certainly sought to listen and take on board comments from a wide range of those engaged in campaigning. I pay tribute to my noble friend Lord Wallace of Saltaire, who met far more groups than I did. These meetings and deliberations, and indeed the contributions made in Committee in your Lordships’ House, have very much informed the proposals that we have come forward with today. Again, I thank the noble and right reverend Lord, Lord Harries of Pentregarth, and the other members of the Commission on Civil Society and Democratic Engagement for their contribution to this debate.

The purpose of Schedule 3 is to extend the range of activities for which a third party incurs controlled expenditure. It takes forward a recommendation from the independent Electoral Commission to align the range of activities for which third parties incur controlled expenditure with that for political parties. The Electoral Commission has highlighted that there is no clear reason why controlled expenditure for third parties applies only to election material. This difference means that a potential gap arises in the rules governing elections in our country.

The Government and the Electoral Commission believe it is important that this potential gap in the regulatory regime is addressed. However, the Government also acknowledge some important issues that have been raised, not only by noble Lords but a number of campaigning groups. As such, we have tabled a number of amendments to Clause 26 and Schedule 3. I will take the opportunity to explain what they do.

Currently, the regime under the Political Parties, Elections and Referendums Act 2000 outlines specific activities that do not incur controlled expenditure. These include volunteers, publications which are not advertisements in newspapers, broadcasts on certain channels such as the BBC or S4C, and certain reasonable personal expenses. Government Amendment 37 removes these exclusions from Section 87 of PPERA and Amendment 44 inserts them into new Schedule 8A and expands the types of expenses that are excluded from incurring controlled expenditure.

The full range of exclusions that the Government have brought forward includes amendments to expenses in respect of the translation of materials from English to Welsh or Welsh to English. I shall say something about the important points made by the noble and learned Lord, Lord Morris, and the noble Lords, Lord Wigley and Lord Elystan-Morgan. At present, controlled expenditure is incurred on the production and publication of election materials, such as leaflets. The Bill retains this, but costs associated with translating these materials from English to Welsh or vice versa will be excluded. The noble and learned Lord, Lord Morris, said he hoped that this was an oversight and that it was not there in the first place. If there was an oversight, and I think there probably was, it was probably also an oversight in the 2000 Act, because election materials are covered by the provisions in that Act. I hope, albeit belatedly, that there is considerable cross-party and non-party consensus that it is something we should be doing.

The Government believe that this highlights the importance of the Welsh Language Act 1993, which treats the Welsh and English languages as equal. It follows the practice of producing election material and ballot papers in Welsh. We are grateful to the noble and learned Lord for raising this issue in Committee. He asked about production costs. When we are giving something it is easy to say that it is not as much as you thought we were giving, but we believe that extending the exemption further than the cost of translation would go too far. It would allow campaigns to print different material for different addresses without being regulated. For example, if a campaigner prints 100 leaflets in English, he can then print 100 leaflets in Welsh for an entirely different purpose. Therefore, we thought it important that this amendment should relate to the cost of translation, rather than the production of material.

Indeed, that is what we thought was intended by the noble and learned Lord’s amendment, when it says that production,

“shall not include costs incurred by the translation of those materials from English into Welsh or from Welsh into English”.

Indeed, the Government’s amendment refers to,

“expenses incurred in respect of the translation of anything from English into Welsh or from Welsh into English”,

which may even go further—there may be expenses other than translation expenses. I want to make it clear that we think, having considered this, that to relate it to the publication costs—to the printing of the leaflets—goes further than is needed to address the important point about Welsh translation.

Surely the Minister accepts that if an organisation—say, the NSPCC—requires a leaflet to be put out in England and in Wales, in England it might be in other languages but it need be only in English to meet the law. In Wales, it would be in Welsh bilingually with English. Sometimes that can mean double the size of the leaflet. Sometimes it might be constrained to six instead of eight pages in the way that bilingualism can be laid out, but the cost of producing something in a bilingual format for the customers is significant because of the print and the paper, not just the time taken to translate a leaflet. That is relative peanuts in the operation. If the Minister is excluding the other parts, there is a very serious implication.

My Lords, as I have indicated, we thought that the amendment that the noble Lord, Lord Wigley, has signed did not actually go further than we were going. I think there has been a proper debate on this. I do not want to mislead the House into thinking that we are willing to countenance in the Bill an opportunity to exploit it and to double up on the number of leaflets. I hear what the noble Lord says and, subject to what I have already said about not wanting to incur a loophole, I am prepared to consider whether the wording reflects what might be called a marginal cost of translation but not costs that might allow more leaflets to be published. The noble Lord is nodding his head; perhaps he agrees that that is not an unreasonable position.

I hope that the noble and learned Lord, Lord Morris, will agree that it is not entirely clear that these additional production costs were covered by his amendment either. Certainly, we did not think they were.

I thank the noble and learned Lord. It is obvious to me that, in accordance with the definition of “controlled expenditure”, production is specifically referred to. You cannot have anything to translate unless you have something produced: that means a piece of paper. I was certainly not encouraging a vast increase in the whole gamut of informational literature, but rather the specific translation and the costs incurred in preparing for the translation, particularly the paper. It may be that I was not ambitious enough. That is entirely my fault and that of those who were advising me—they were not ambitious enough in putting forward that the provision should include specifically the preparation of a document for the purpose of translating. That is all that I am asking.

My Lords, I do not think that there is really all that much between our position and what has been said both by the noble and learned Lord and the noble Lord, Lord Wigley. I hope that we can look at it and get the right wording to capture the consensus among us without creating loopholes for having much more material produced. On that basis, I hope that the noble and learned Lord will not press his amendment and, all being well, we will get our amendment on to the Order Paper.

I am encouraged by that. I hope that, if I do not press my amendment, we will return to the matter at Third Reading after further consideration.

That is indeed what I had in mind. Time may be short, but I think that we can have some useful engagement on that.

Government Amendment 43 excludes the costs associated with providing protection of persons or property in relation to a public rally or event. While the Government believe that it is important that third parties who organise public rallies or events which seek to influence voting intentions incur controlled expenditure, it is only right that third parties do not incur controlled expenditure ensuring that such events are run safely.

Government Amendment 44 excludes expenses that are reasonably attributable to a person’s disability. This would mean that costs associated with, for example, providing materials in Braille, or ensuring that any person with a disability could attend a public event or meeting, would not count towards the third party’s controlled expenditure.

Government Amendment 42 provides that parades notified under the Public Processions (Northern Ireland) Act 1998 are excluded from the provisions of PPERA. Your Lordships will recall that we had a debate in Committee on Northern Ireland. Although the particular issue of parades was not raised, we were aware that it was a concern that some people had expressed. The noble Lord, Lord Rooker, led an important and helpful debate on Northern Ireland, and we seek to address it here.

Government Amendment 38 amends the defence, currently in the Bill, for a person or third party charged with an offence of incurring controlled expenditure in excess of the spending limit—that is, above the limit in a part of the UK or the constituency limit—to show that they complied with the relevant code of practice so that it covers both recognised and non-recognised third parties. The amendment is needed to reflect the changes to the reporting requirements in a later government amendment which provides for no spending return if the threshold is not reached. We have since identified a couple of points not properly dealt with in the amendment. The first is that the defence does not adequately cover the case where an offence might be committed by virtue of expenditure incurred on behalf of the third party. Secondly, the defence should also cover the offence in relation to targeted expenditure. We think that it is important in both these cases that those subject to regulation should have the benefit of the defence and we will therefore bring forward amendments at Third Reading to deal with these outstanding anomalies.

Government Amendment 41 clarifies the drafting on public rallies, so that it is “public rallies or events” to be inserted by Amendment 42. The reference to “public meetings” is removed, as it was unnecessary and potentially confusing because “other public events” includes public meetings.

I turn to the amendment moved by the noble and reverend Lord, Lord Harries of Pentregarth, and a number of other amendments that have been spoken to in this group. Amendment 34 would amend Clause 26 so that any campaign which could reasonably be regarded as intended to promote or procure electoral success, involving legislation going through Parliament during the regulated period, would not count as controlled expenditure. I listened carefully to the speech made by my noble friend and agree with him that we should not pass legislation which inhibits expression of legitimate opinion.

To incur controlled expenditure and be included in the regulatory regime, it is important to remind ourselves that the third party must be carrying out activity which could reasonably be regarded as intended to promote or procure the electoral success of a party or a group of candidates. We have heard concerns that campaigns against specific policies or pieces of legislation will be caught by the regulation. It might assist the House if I set out how, generally, this will not be the case and the circumstances in which it might be. The noble Baroness, Lady Mallalieu, asked whether we would meet the Electoral Commission. I can tell her that this issue has been raised with us. We have been in discussion with the Electoral Commission and I can confirm that it agrees with this interpretation.

If a campaign group wished to lobby parliamentarians over legislation going through the House, this would not be subject to regulation under Part 2. It is only where the expenditure by a campaign group can reasonably—that is, objectively—be regarded as intended to promote or procure the electoral success of a party or candidates that such activity will be subject to regulation. For example, encouraging constituents not to vote for MPs in the general election if they had voted a certain way on the legislation before Parliament should and would be included as activity leading to controlled expenditure. If a group so closely aligns itself with a policy of a particular party that its campaigning on behalf of that policy can only reasonably be seen as encouraging support for that party, that would also count. That is campaign activity, and where it takes place the Government believe that spending on it should be transparent to the public.

The noble and right reverend Lord, Lord Harries, gave a good example when he talked about new towns. We believe that under his example, people will be able to support or oppose such a proposition freely. It would be caught only if they promoted electoral success, for example, by distributing leaflets reading, “Don’t vote for candidate X”—or X party—“at the next election”, because he or she had supported or opposed the new town. The amendment states,

“unless the expenditure relates to legislation before Parliament during the regulated period”.

If Parliament were to accept that definition, it would really open the door to any amount of expenditure. My noble friend Lord Horam suggested a limit of £300,000; in fact, it would not be controlled expenditure, it would be unlimited expenditure in the run-up to an election which could be directed against or for a particular party. Given that there are restrictions on what the political parties can spend during that period, it is not reasonable that there should be such a wide gap in the provisions that an unlimited amount of expenditure could be related to a particular campaign.

I reiterate that the general position is that if a campaign group wishes to lobby Parliament and parliamentarians over legislation, that is primarily directed at trying to change legislation and would not be subject to regulation under Part 2. As my noble friend Lord Horam said, we are seeking a balance, allowing proper room to campaign but not to swamp.

I also highlight that the Electoral Commission does not support this amendment. It states that such an exemption would allow unlimited spending on a potentially wide range of topics. It believes that it could produce significant and unintended gaps in the coverage of the rules. The issue of the year up to the campaign was raised generally in the debate. Of course, a later amendment will mean that this is actually only a seven-and-a-half-month period. Clearly, if, as a result of experience, people feel that the guidance has not been sufficiently helpful, as we have provided in later amendments, there will be a review post the 2015 election. The amendment as it stands opens up a considerable gap and would lead to an imbalance whereas, as my noble friend said, we should be seeking a balance.

On Amendment 40, my noble friend Lord Tyler seeks to amend Schedule 3 so that costs associated with sending materials to committed supporters who have been actively involved in the activity of the third party would be excluded from the calculation of costs for controlled expenditure. Costs of sending material to members or certain supporters are already excluded, as PPERA and the Bill make clear. The material or activity must be available or open to the “public”, which for these purposes would not include those members or supporters.

As the existing Electoral Commission guidance makes clear, the exact nature of a committed supporter will vary between organisations, but could include regular donors by direct debit, people with an annual subscription or people who are actively involved in the third party. The amendment goes much further than that. Amendment 40 defines those actively involved as those who have made a donation to the recognised third party, or those who have made a direct communication to the recognised third party in the past 12 months.

Consequently, an individual who writes to a campaign organisation with a general inquiry about their activities, or even one who lives next to an animal sanctuary who writes to them complaining about the noise, might possibly be regarded as being actively involved. I do not believe that that is my noble friend’s intention, but I fear that using that definition allows the provision to become ineffective, particularly in an age of instant electronic communication.

The Electoral Commission does not consider people to be committed supporters if they have simply signed up to social networking sites or tools, or appear on mailing lists that may have been compiled for general commercial, campaigning or other purposes. An exclusion of costs, based on direct communications with third parties—whatever the nature of that communication—creates a wide exemption.

I know that my noble friend has worked hard and has met officials to try to resolve this; I regret, however, that we fear the definition he has come up with is too wide. We believe that the better way is that the Government and the Electoral Commission believe that the Electoral Commission’s guidance is the proper place to outline who counts as a committed supporter. In its briefing the commission outlined that it does not support this amendment due to the fact that it is unclear what scale of campaigning would be exempted from the regime or how the test would apply in practice.

Finally, my noble friend referred to Amendment 45A to ensure that any changes to the range of activities outlined in new Schedule 8A would be made through an affirmative resolution procedure. That is already the case in the Bill as drafted. I draw noble Lords’ attention to Clause 26(12), which amends Section 156 of PPERA so that any order under new Schedule 8A, as inserted by Schedule 3 to the Bill, is by affirmative resolution. It does so by amending the existing section of PPERA, setting out what parliamentary procedure applies to orders and regulations. The Government agree that it is important that any changes to the list of activities that incur controlled expenditure should be subject to the affirmative resolution procedure.

I hope that that reassures my noble friend. In the light of the explanations given, I hope that the noble and right reverend Lord, Lord Harries, is prepared to withdraw his amendment.

I have thought of a question while the Minister has been speaking, which is not in any way diversionary. It ties in with the comments made earlier about what would happen if, in this period of a year, a Government sought quite deliberately to save legislation. The Minister answered the point about legislation in Parliament, but there are highly controversial matters outside Parliament; people do newspaper adverts and all kinds of things. I have been thinking about this question, having gone through paperwork recently. When we get close to an election, the Cabinet Secretary and the head of the Civil Service will issue an edict around Government to Ministers and departments about what you can do and what you cannot do in that period. Is that going to change now that we have a fixed-term Parliament, with this window and this picture of a much larger window?

This is not purdah, but an extended period in which other people are constrained about what they can say and do. Will the advice that normally comes out close to an election from the Civil Service to Ministers actually change and take account of what is being done in this legislation?

My Lords, I always know it to be dangerous when the noble Lord stands up and says he has been thinking about something—and so it was.

I took the fixed-term Parliament legislation through your Lordships’ House and I do not recall—nor, indeed, have I seen at the present time—anything that suggests there is going to be any change. Of course, that means that there still will be a period during which Governments are not allowed to do this; but I have not seen any proposal to reflect the fact that there is a fixed-term Parliament. When that period will arise will become more apparent, or more foreseeable. If I have got that wrong, although I do not think I have, I will inform the noble Lord.

I thank all noble Lords who spoke in favour of my amendments and the other amendments to which my name has been attached and I thank the Minister for his response.

The noble Lord, Lord Horam, drew attention to some of the unfortunate consequences, as he understands it, of this legislation at constituency level. However, what I had in mind was primarily what happens at the national level. He suggested that political parties would be limited in what they can campaign; but the Government, in pursuing their legislation, are not limited in the amount of money they can spend in order to get legislation through Parliament, and nor are the Opposition.

Suppose you have two third parties: one, the Countryside Alliance, which wants to campaign against a new town, and the other the National Housing Federation, which wants to campaign in favour of more housing. Why should they be inhibited by the Bill in a way that the political parties would not be inhibited? As the noble Baroness, Lady Mallalieu, pointed out, we are not talking about the post-Dissolution period, so a lot of the ill effects that the noble Lord suggested might happen at constituency level would not be allowed by this amendment, because we are talking about only legislation going through Parliament and that ends when Parliament is prorogued. Therefore I believe that this is a crucial issue that goes to the heart of our democracy.

The noble and right reverend Lord indicated, when referring to what my noble friend Lord Horam had said, that it had not been his intention to engage in constituency expenditure. Does he accept that if this is not controlled expenditure, it could lead to expenditure in a constituency up until the time when the Representation of the People Act kicks in?

I accept that there are certainly implications for what might happen at local level. However, I ask the noble and learned Lord to continue to think about it because this issue goes to the very heart of the democratic process. I very much hope that, having talked to the Electoral Commission to see whether there might be a way forward, he might give the very clearest statement at Third Reading, which would then be translated into advice for the Electoral Commission. We need something here to safeguard the fundamental rights of campaigners to campaign during this period. With that, I beg leave to withdraw the amendment.

Amendment 34 withdrawn.

Amendment 35

Tabled by

35: Clause 26, page 13, line 19, at end insert—

“(5A) Before subsection (5) insert—

“( ) Any limit applying to campaign expenditure under this Act where that expenditure is incurred by or on behalf of third parties in connection with the production or publication of election material which is made available to the public at large, or any section of the public in Wales, shall not include costs incurred by the translation of those materials from English into Welsh or from Welsh into English.””

My Lords, I welcome the promise of a discussion with Ministers before Third Reading and if a satisfactory formula is not found, I would wish to return to the matter then. The Government might seek the advice and elicit the views of the Electoral Commission in the short period we have, so perhaps we could make progress on that basis.

Amendment 35 not moved.

Amendment 36

Moved by

36: Clause 26, page 13, line 19, at end insert—

“( ) In subsection 8(a) after “body” insert “(except a body which is a charity)”.”

My Lords, first, I should like to say how good it is to see the other Lord Wallace—my noble friend Lord Wallace of Saltaire—back in his place on the Front Bench having, I hope, had restorative attention.

In Committee, there was a long debate on this amendment, which has a simple purpose: to remove charities altogether from both the Bill and PPERA 2000. I am bound to say that in the intervening period there has been a great deal of discussion, meetings and lobbying. It is fair to say that the dear old charity sector —which must be one of the slowest of any sector in our society to get the hang of things, while being a most invaluable element in our society—is now showing its support, late in the day, for the proposal that charities are taken right out of the Bill. It is a pity that this movement did not show itself a good deal earlier.

I must also explain that in Committee there were three different supporting names on this amendment: my noble friends Lady Williams, Lord Tyler and Lord Greaves. They—how shall I put it?—stood back at this stage of the Bill to enable Peers from other parts of the House to put their names to an amendment which is felt strongly about. It is a great resource and support to have the names of the noble and learned Lord, Lord Mackay of Clashfern, and the noble Lords, Lord Best and Lord Low of Dalston, on the amendment. They are, respectively, an ex-Lord Chancellor, an ex-chief executive of the Joseph Rowntree Foundation and an ex-chief executive of the Royal National Institute of the Blind.

We have put this amendment forward today and continue to feel really strongly about it because we are convinced that to draw charities into this net is counterproductive, legally illogical, because they are the subject of a completely separate and rigorous branch of law in a way that no other NGOs are, and wasteful of scarce and valuable volunteer time and philanthropic resources if we persist in so doing. I shall address only a few points. I am very mindful of the time and my colleagues will deal with different points relating to the amendment and its consequences.

The one word that keeps coming back to me in relation to all this is “practical”—or, in this case, “impractical”. It seems a thoroughly impractical proposal to lump charities in with NGOs, which can range right across the board from being relatively public-spirited—as, for example, most of the supporters of the Harris commission certainly are—to completely self-interested NGOs, some of them acting as fronts for commercial organisations and others with political aspirations. The one thing you know for certain and beyond peradventure about a charity is that it exists exclusively for the public benefit. Private benefit and charity are wholly incompatible dimensions.

This branch of our law is not some Johnny-come-lately or some rather weak branch of law, if I may put it that way; it is about as fiercely and strongly embedded in our culture as any aspect of law. What is more, the Charity Commission, which has been doing its job for more than 150 years, is a committed body with vast experience, though admittedly with inadequate resources, which is there to try to police this extraordinary sector. Extraordinary it is because it actually needs wonderfully little policing. The amount of fraud and—how shall I put it?—manipulation in the charity sector is a tribute to the best in British society and culture.

The duty on us as legislators, when touching on this sector in particular, is to act with extreme caution because one can so easily damage that which one hopes to assist. Above all, we need to avoid confusion in the legislation that we shower on the British public. There is one way of avoiding confusion in the issue of the regulation of NGOs: to avoid shackling charities of all organisations with duplicatory regulation and thus the responsibility for two sets of regulations and indeed regulators. Of all the groups in our society that surely do not need that, above all others by far are charities. Although of course the Bill is vital and it is good that amendments have been introduced—we thank the Government for being so receptive—it is important that we retain our civic vitality, which, let us be honest, is languishing somewhat. However, in the process, we must not damage that which we seek to uphold.

The confusion surrounding charities in relation to the Bill is quite extraordinary. I can illustrate that by referring the House to the letter written last night by the Charity Commission to a number of us now in the Chamber. It deals in particular with this amendment because the Charity Commission considers it of such importance. I confess that many of us have been trying for some considerable while to get the Charity Commission to come out of its shell and be clear about what it thinks of the arguments advanced on each side of this debate. At least now we have a letter, written by the public affairs manager of the Charity Commission at 6.30 pm last night. Pretty early this morning, as one might guess, I was on the telephone to seek clarification.

The letter has four paragraphs. Can one ask Peers to put up their hands if they have had this letter? It is probably unprecedented, but I have seen one, anyhow. I suspect that a minority of those here have seen this letter and that it will be helpful to quote from it. It is important given that the Charity Commission is the kingpin in this field. The first point that it makes in relation to this amendment is under the heading “Charity law and electoral law—the current situation”. It states:

“Charities must never support political parties or candidates for election”.

That is the basic premise. It continues:

“A charity can engage in campaigning to influence public policy but only in the context of supporting the delivery of its charitable purposes. We recognise that there are some circumstances where a charity’s activities can adhere to charity law but may still require them to register with the Electoral Commission during an election period”.

I have to be honest. I was slightly crestfallen when I saw that because my proposition hitherto has been that charity law and election law in this bit of the landscape are so similar as to be no different from each other. I argued this with the senior member of the commission who is fielding calls in relation to this letter and after a while, she said, “Well, perhaps we did not put this as we intended”. It then became apparent that when the Charity Commission made this statement it was talking about the law as it stands now, not the law as it will be after the Bill is enacted.

I am grateful to my noble friend because I shared his confusion about that missive last night. I too quite separately raised a question with the same person at the Charity Commission and was sent back this very explicit statement:

“We are by no means suggesting that CC9 is not fit for purpose. Instead we believe that CC9 provides clear and concise guidance on what is and is not acceptable for charities when campaigning. This is an issue that we regulate firmly and take action where necessary”.

In other words, far from saying as seemed to be the first impression that I had from the previous letter that the Charity Commission was not up to this job, it thinks it is up to the job and does not think it is necessary to change the situation so that another commission is so actively involved, as the Bill would suggest.

I am grateful for that. My noble friend is lucky in having had a letter. When I finished the conversation, the Charity Commission said to me that it would send a new communication forthwith to everybody who received the first one to make clear that this statement did not relate to the law as it will be after the passing of this Bill. That is just one small example of—

I am fortunate enough to have the original letter before me. I wonder what the noble Lord makes of the statement:

“We do not believe that in the best interests of public trust and confidence in charities an exemption for charities is the most appropriate method for the regulation of charities during an election period”.

There cannot be anything clearer than that. I know it is very disappointing for the noble Lord, but the Charity Commission has come out unequivocally in opposition to his amendment and I think he will have to face that.

My Lords, the noble and right reverend Lord, Lord Harries, is actually addressing a different issue in this letter. I was dealing with paragraph one. He is dealing with paragraph two, about public trust and confidence in charities, which I was about to come on to and which, if I may, I will deal with in a second.

I emphasise the fact that the Charity Commission has delivered to those in this House who are particularly involved with this issue some guidance in relation to the law—comparing electoral law with charity law—that leaves us at best in a state of some confusion. I think, as I will say in a minute, that the approximation of charity law and electoral law is now so close that to all intents and purposes it is in practical terms the same. However, as we know better than anybody on earth, the capacity of lawyers—and not only lawyers—to argue about that is infinite. When you get a letter such as this from the Charity Commission, you can see why.

Coming to the point of the noble and right reverend Lord, Lord Harries, the second point here is headed:

“The effect of an exemption on public trust and confidence in charities”.

It starts by saying that the Charity Commission believes in keeping the burden on trustees and charities to the minimum that is consistent with an effective regime. That, in itself, supports my case, because for charities to have two sets of regulators is plainly not keeping their burden to a minimum. Secondly, it rather argues against its own competence to then go on to say that you need two sets of regulators.

I will also add the point that the commission makes here, when it advances the proposition, which has been heard in debate in Committee, that some organisations will seek to exploit the differences between charity law and electoral law by registering as a charity if they are a non-charity, in the expectation that that will give them more latitude in terms of what they can do during election periods.

I was minded to vote for the amendment, but, having read the letter twice now, does the noble Lord not accept that the Charity Commission does not agree with Amendment 36? That is crystal clear. There is incompetence of a very high order by the Charity Commission, by the way, because it does not do a very good job. However, it does not agree with Amendment 36, so do we have to spend a lot of time on this?

My Lords, that is, on the face of it, a compelling argument. However, I am trying to put it to the House that the Charity Commission’s own advice here is faulty. It admitted as much in our conversation this morning and said that it would circulate a letter forthwith.

Which, of course, it has not done. I suspect the reason is that when the person I was speaking to went back to the chief commissioner and the chief executive, they said, “My goodness, we can’t go into print admitting that we’ve made a mistake”.

I am very grateful. Of course, I was also minded to support my noble friend. However, time is at a premium. There is clearly a problem here. Would it not be better to have discussions with the Charity Commission and the Minister between now and Third Reading, and then, perhaps, to table an amendment that does have their support? We can waste an awful lot of time on this. I am not being critical of my noble friend, for whom I have very real regard, but he has been speaking for a quarter of an hour or more and we have very important issues that we must determine today.

My Lords, I am in a cleft stick; I have indeed got 15 minutes on the Clock, but my noble friend will accept that I have been interrupted five times now, which takes a wee bit out of one’s available argument time. I will keep this as short as I can. It is unfortunate—let us put it that way—that we have a letter at the 59th minute of the 11th hour which is, at best, unclear.

I know that a number of my colleagues have different points to make. It has been said, time and again, that there should be a level playing field between non-charitable NGOs and charitable NGOs. Well, yes and no. First, we have a whole lot of improvements for the non-charity NGOs. Secondly, however, the reason we persist in seeking this important change is precisely because charities are basically different in kind, not just because they have a separate branch of law and a separate regulator.

The bureaucratic consequences for charities having to meet the demands of two regulators will be significant. Although the thresholds have been raised, which is important, the number of charities that will still be swept up by this legislation is far greater than many Members of this House may think. It will be many thousands. It does not take a great deal to rack up £20,000 if you are a charity with a few branches around the country.

Secondly, given that the vast majority of charities have no paid staff, the people who will have to implement this complex bureaucratic stuff are not professionals but volunteers. Simply tooling up a charity that is wholly run by volunteers to cope with this new regime and all that it means will be a massive and demoralising task for so many of them. Frankly, volunteers do not want to spend their precious hours getting to understand the legislation that we are in the process of putting on the statute book and then trying to get to grips with it in practical terms, filling in the forms and all the rest of it. The consequences, I put it to the House, will still be huge, despite the number of charities that are, on the face of it, taken out of the purview of these provisions by the raising of thresholds and the rest of it. I cannot emphasise that too strongly.

Let us suppose that you are a trustee of a charity. You will not have a paid chief executive, so it may be a senior volunteer who comes to you and says, “Look, Mr Phillips, we have this new legislation. We do not think we are touched by it because we do not think we will reach the threshold, but what do you want us to do?”. I am afraid an awful lot of trustees will say—

Not only the Charity Commission opposes this amendment; the Electoral Commission does, too. Also, we have a situation where the Government have given way on the review period. We argue there is going to be a review of this piece of legislation, so if the matters that the noble Lord is so concerned about come to pass, the review will pick them up. We are now in supposition territory. I hope that the noble Lord will reflect on that before deciding what to do with his amendment.

I certainly will. I am grateful for that point, because I was going to say that a review of this will be essential in light of what happens at the next general election. Indeed, the noble Lord, Lord Hodgson, tabled an amendment that I think—

It is now a government amendment, so we are going to get it—and that is vital because we will learn a great deal after that. I will just finish the point that volunteer trustees, perfectly understandably, are going to be cautious about this new legislation. The last thing in the world they will take a risk with is the prospect that things may get a bit out of hand or may not be perfectly understood, and that they, the trustees, will end up being personally liable. As I am sure everybody hearing this debate knows, they are personally liable. It does not matter if they are a limited-liability charity.

All in all, therefore, these are some of the reasons—I think other contributors to the debate will add others—that we should avoid the huge confusion that will follow if we subject charities to both charity law and electoral law. For good reason, I will not detain the House now beyond saying that this is still a very important issue that touches a hugely important part of our civic society—the very part of our civic society that does so much to uphold and vivify election campaigns. I beg to move.

My Lords, I am extremely well aware that the Charity Commission has given us a document to say that it is against this amendment, but the charity commissioners do not actually do legislation; that is our responsibility. They have set out in this missive that we got about 6.30 pm yesterday some of the reasons for their opposition.

Charities are, as I understand it, very fully regulated by law. Charities are those bodies that are established for charitable purposes only, and charitable purposes are defined as falling into certain classes, with the general provision that a charitable purpose is one that must be for public benefit. When I got this missive and had a chance to look at it, I e-mailed back the writer of the document asking, “Are you saying that a charity can lawfully, under existing charity law, engage in activities regulated by this Bill?”. I got an e-mail back to say that he was out of the office today and that, if it was urgent, I should ring a number. So I rang the number, and no one answered—although these things happen, even in the best regulated circles.

This is an extremely important point, as I see it. Charity law is sufficiently robust to require charities to obey the rules, which state that they can use their expenditure and efforts only in support of or in pursuance of their charitable purposes. As the missive says:

“Charities must never support political parties or candidates for election”.

At the moment, I cannot see why it is necessary that the Bill applies to charities. However, the Charity Commission, in the missive we got last night, goes on to explain that if the charities were exempted, its task of making sure that the charities obeyed the law in this regard would be too much for it, particularly in an election period. The Government have cut its budget so much that it cannot support this or do it properly. If that is the reason for passing the responsibility for seeing to this from a government organisation, the Charity Commission—which has a very long history of 150 years or so—on to charities, which depend on voluntary contributions for their financial support and to a great extent for their personnel support, it is an extremely bad one. Why should the government organisation pass on its responsibility to ensure that this is happening to the charities themselves and have them registered for that purpose?

This is an extremely serious matter that the Charities Commission has raised in this missive to us. So far as I am concerned, it requires the Government to look into the matter. I would like to see the Government undertake to look into this between now and Third Reading. I do not wish to pursue the matter further today. I originally raised this matter with the noble Lord, Lord Wallace of Saltaire, before he was away, and I am extremely glad to see that he is able to be back with us again. This is an important matter that I feel strongly about, and one that your Lordships’ House should not just pass over. We do not need to spend long on it, because it is a short but very important point.

Before the noble and learned Lord sits down, I have a question about the e-mail from the Charity Commission, which I have here. My reading of it is that the question about resource implications is a subsidiary argument, and that the key argument is:

“We do not believe that, in the best interests of public trust and confidence in charities, an exemption for charities is the most appropriate method for the regulation of charities during an election period”.

Surely that is the argument that the Charity Commission is putting forward against this amendment. The question about resources is just supporting that.

The reason that that is a difficulty is because it cannot be relied upon to enforce the law. There is no question of trust in charities being damaged by propaganda and that kind of thing. If it were shown that charities were not obeying charitable law, that would damage trust and confidence. If the commission does not have enough resources to pursue that properly—as paragraph 4, I think, says—that is a problem. I can see that if that is justified, it is a problem, but it is a very serious problem if organisations set up to ensure that the law is observed in a particular area say that they do not have sufficient resources to do it properly.

Does the noble and learned Lord not accept that the Electoral Commission has come out exceedingly strongly against this amendment? It is not just the Charity Commission but the Electoral Commission, which has a specific statutory duty.

I understand that, but I do not understand why they have come out against it, because it must be based on an understanding that charities could in fact engage in activities that are regulated by this Bill.

My Lords, my name is added to this amendment and I do support it, but I think that we have been somewhat blown off course by the reference to this letter that we have had from the Charity Commission, which we have not had very long to consider, and also by the briefing that we have received from the Electoral Commission.

On the Charity Commission’s letter, I honestly think that this faces both ways: at one point the commission says that it is not in favour of an exemption but elsewhere it says that it believes in keeping the burden of regulations on trustees and charities to the minimum that is consistent with effective regulation. If that is what the commission is saying, then why on earth impose another burdensome layer of regulation on charities? Or is the commission saying that the regulation that it provides is not effective? I honestly think that the letter that we have received from the Charity Commission is not robust enough to sustain any argument and I do not think that we should be further diverted by it, certainly not today.

I agree that this has rather blown the debate off course and I think that the suggestion made by the noble and learned Lord, Lord Mackay of Clashfern, that this be taken away, that discussions take place and that we ask the Government to review the situation and come back with something at Third Reading, would honestly be the best way of proceeding.

My Lords, I think that I shall go with the suggestion that we defer debate on this until Third Reading. I will just throw one or two thoughts into the pot that have not yet been fully explored.

Charity law is currently very much under review. The noble Lord, Lord Hodgson of Astley Abbotts, has reported on the workings of the Charities Act 2006 and the Select Committee on Public Administration has looked into the operations of the Charity Commission. Both the noble Lord, Lord Hodgson, and the Select Committee on Public Administration issued reports last year recommending changes, and the Government have accepted many of those recommendations. In addition, the National Audit Office recently issued a report calling for a reform of the Charity Commission, and the Law Commission is looking at charity law and will report this year.

It is almost certain, therefore, that there will be significant reforms to charity law in the near future, so if charities are taken out of the lobbying Bill, which is the proposition here, there will be an opportunity, if necessary, to amend charity law and to see changes of this kind in a broader and wider context at a later date. The many arguments on why charities should be taken out of this particular Bill stand on their own, I think, and although we are giving great deference to the quangos, I find the comments of the noble and learned Lord, Lord Mackay of Clashfern, and others to be compelling. Possibly we should not be debating all those details if legislation that is specifically about the future of charities, charity law and the Charity Commission is in the pipeline. It would be better to defer our debate until then, but I would be very happy to see this brought back at Third Reading.

Perhaps the House will allow me just a couple of minutes to put the opposing point of view to the noble Lords who have spoken so far. Their proposal is superficially very attractive and would be possible if the definition in Clause 26 were different. If the definition of “controlled expenditure” in the Bill said that it was expenditure whose prime purpose was the promotion, or procuring the election, of a particular candidate or party, it would be possible to take out charities. They should be taken out because, as the noble and learned Lord, Lord Mackay, rightly said, charities are not allowed to have as their prime purpose the support of political parties.

However, that is not what the Bill says. Clause 26—and we have heard it thousands of times—includes two important points, which are that you do not have to mention the name of the party and it does not have to be your prime intention. Therefore, you can campaign on an issue and still be caught by the regulation of the Bill. That is why—

I thank the noble and right reverend Lord for giving way. Does he not agree that to be caught by the legislation the expenditure has to be “intended” to procure that effect?

The whole point of those provisions, which is where the sting is, is that you can campaign on and focus on an issue and that can be reasonably regarded as indirectly supporting a particular candidate or party, or you can even do so inadvertently. Let us be quite clear: charities are able to campaign on issues.

I am grateful to the noble and right reverend Lord for giving way, but he really cannot get away with that. You cannot inadvertently satisfy the requirements of Clause 26 when it says that you “intend” to promote or procure electoral success. Intention is not the same as inadvertence at all, and it is a very strong test. The fact that there are other matters that you are trying to advance at the same time does not get away from that test.

Then why does the Charity Commission guidance—and I have read carefully both its main guidance and its guidance in relation to the Electoral Commission—include a series of examples, just like the Electoral Commission, where charities may or may not be caught? This is a borderline area. Charities are able to campaign and to campaign vigorously, and many trustees encourage them to do so. Therefore, it is always possible for them to come within the scope of this provision.

If you take out charities, only two courses are open to you. Either you have an unlevel playing field so that you have a charity campaigning against a campaigning group which is not a charity, and the charity, if it were taken out, would be able to spend an unlimited amount of money, whereas the non-charitable campaigning group would have very strict limits on what it was allowed to spend, or the Charity Commission could set up a much stronger policing body than it has at the moment—one which would match that of the Electoral Commission.

I am grateful to the noble and right reverend Lord and I apologise for intervening again, but does he not agree that we are continuing to get bogged down in technicalities about the interpretation of very detailed points in this clause? If the point is taken that there will be discussions before Third Reading and we can look for something more fully considered to come back then, it will make a lot of sense to put into that review the points that the noble and right reverend Lord, Lord Harries, is dealing with at the moment.

My Lords, I take the point but it was important to state the argument because some people are understandably initially very attracted to this idea. It would lift the regulatory burden, and people are attracted to the idea of taking out charities. However, there are very strong, compelling and rational reasons why this should not be done, and that is why it is opposed by the Electoral Commission, the Charity Commission, the commission that I chair, the NCVO, ACEVO and all the others.

My Lords, with the greatest respect, we are really getting beyond the guidance in the Companion regarding Report stage. I think that in a sense the House would like to make some progress.

My Lords, I will take three minutes; I am not going into technicalities and I freely admit I am going to introduce a bit of partisanship.

The Charity Commission states:

“Charities must never support political parties”.

If that was the case—if that was the norm—we would not have a problem. I would like to vote for this but charities have got to be regulated, even during the electoral period. I make no apology: I raised this before, at Second Reading.

Page 14 of the Conservative manifesto for the 2010 election shows a full-page portrait of the chief executive of a large national charity, extolling the virtues of the policies set out on the subsequent pages. This was the Conservative Party manifesto using a charity for party-political purposes. I was appalled when I saw it and could not understand why there was not a row about it. That chief executive, whom I later recognised, turned up in this House a few months later. I am not going to mention her name because I have not given notice, but the charity is Tomorrow’s People. This was a thundering disgrace and I would like, in the discussions that are about to take place, an assurance that political parties will submit their manifestos to the Charity Commission and the Electoral Commission to make sure that this kind of abuse of the system and of charities does not happen again, either by the Conservative Party or, inadvertently, by any other political party.

I apologise for introducing a note of partisanship, but I have been waiting a long time to say this.

My Lords, with due respect to the House, as I have not spoken on this, a number of the noble Lords who are proposing the amendment are suggesting that they will not take it forward but that there will be other debates. There are amendments later which are extremely important and vital to the sector if it is to carry out its work. I would be grateful if the House could move on.

My Lords, that being said, I will speak quickly and shortly to say that, while we absolutely understand the desire to stop the bureaucracy being placed on charities, we do not want that for other bits of the third sector either. This is why we want a much more fundamental change which takes them out too. They also use volunteers and have all these problems. We do not think the rest of the voluntary sector should be caught by something which other campaigners will not be. We are, obviously, interested in the Government’s response, but if the issue is simply about dual regulation then there may be a way for the Electoral Commission to devolve its responsibilities in this area to the Charity Commission. However, if it could not answer its phone to the noble and learned Lord, Lord Mackay, last night, I am not sure I would devolve much to it at the moment.

There is a difference: there is an area of activity which is completely legitimate for charities but which will not be covered by the Charity Commission, which only polices charitable law. Even at the moment, under PPERA, there are a whole lot of things which charities are covered by but which are not policed by the Charity Commission, so extra work would be going to them. As the noble Lord, Lord Horam, said, this clause covers work which is completely within their charitable aims and, therefore, eligible under charitable law. To take out one part of the voluntary sector and leave the other in is something we cannot understand. The charities themselves did not ask for this when they gave evidence—oral and written—to the commission chaired by the noble and right reverend Lord, Lord Harries. The Electoral Commission is against it, as are the NCVO and the Charity Commission. There may be a good reason for this: the overwhelming majority of charities that have contacted me are not in favour of it.

As I think the last speaker said, we are very interested in the important issue of staff costs. That is what the charities really want taking out, so I hope we can move quickly to it and the House can have a decision.

My Lords, I thank my noble friend Lord Phillips for raising the important issue of charities and seeking to exclude them from the regulatory regime governed by controlled expenditure for third parties. In Committee, we had a useful debate during which I indicated that some very important points had been made and undertook to give consideration to them. To those who ask the Government to take this issue away and to think about it, I say to your Lordships’ House that we have given this very serious thought. I probably spent more of my time on it than I had necessarily expected over Christmas and the new year in Orkney. I will not overegg it but I think my wife thought that it probably was more than was healthy.

With other Ministers, the Government have seriously thought about this matter and looked into it. Under present charity law, charities are organisations which must be established for charitable purposes only which are for the public benefit. An organisation will not be charitable if its purposes are political. Campaigning and political activity are legitimate and valuable activities for charities to undertake. However, this must be undertaken by a charity only in the context of supporting the delivery of its charitable purposes.

The Charity Commission and the Electoral Commission produce guidance for charities on campaigning and political activity. Both regulators acknowledge that there may be a narrow range of circumstances—noble Lords who took part in Committee will remember that the word given to me by officials was “sliver”, which I did not particularly like but was meant to show that it was a very narrow range of activities—in which charities may be compliant with charity law and also operate within the regulatory regime established by the Political Parties, Elections and Referendums Act 2000. I listened carefully to the speech of my noble and learned friend Lord Mackay of Clashfern. The Charity Commission guidance updated in January 2011 on charities, elections and referendum states:

“A charity may publish the views of candidates in local and national elections where these views relate to the charity’s purposes and publishing them will raise public interest and debate about the underlying issues. The charity must not encourage support for any particular parties or candidates”.

It goes on to say that “even if” a charity is,

“following the guidelines set out in this document and in Speaking Out: Guidance on campaigning and political activities by charities (CC9), if you use material that could be seen as indicating to the public that particular candidates or parties support or oppose your policies, it is possible that you may need to register as a third party with the Electoral Commission”.

Indeed, that has been the position following PPERA 2000. My understanding is that two charities registered in 2010 .

I admit that the circumstances may be very narrow but the important point to remember is that we are using an objective test. It is not a subjective intention of the charities: it is how a reasonable person might perceive what the charities have done. As the noble and right reverend Lord, Lord Harries of Pentregarth, pointed out, Clause 26(4)(c) states that,

“a course of conduct may constitute the doing of one of those things even though it does not involve any express mention being made of the name of any party or candidate”.

Applying that consideration and the objective test is the considered view of the Electoral Commission and the Charities Commission that there could be circumstances in which PPERA should apply.

I am sorry to intervene on the noble and learned Lord, but does he not agree that the test is only partly objective because the test is not what a reasonable person would make of what the charity has done but what a reasonable person would make of the charity’s intention?

My Lords, I can do no better than remind your Lordships of Clause 26, which states that,

“the expenditure can reasonably be regarded as intended to promote or procure electoral success at any relevant election for—”.

The point is that there is a distinction between an objective and a subjective test. It may be that if the charity was complying it was not intending, but if objectively it was thought to have done so it would fall into that narrow range of activity. The important point was made by the commission chaired by the noble and right reverend Lord, Lord Harries; namely, that it is the activity that is important rather than who is undertaking the activity.

I know that the House wants to move on, but the e-mail issued yesterday evening by Mr Rowley has been referred to by a number of noble Lords. He says:

“We recognise that there are some circumstances where a charity’s activities can adhere to charity law but may still require them to register with the Electoral Commission during an election period. Indeed, during the last General Election a small number of charities did register with the Electoral Commission. Due to the increased awareness and scrutiny of this area we believe that this number may increase, regardless of the change in the scope of activities and limits that this Bill proposes”.

My noble friend Lord Phillips was suggesting that somehow or other the information on this coming from the Charities Commission was out of date. It is important to recall that it does set out the current position, but it is a situation in which PPERA is not changing with regard to the definition. It will not change as a result of this Bill, so the case remains that a narrow scope of activities could be covered. The Electoral Commission is clear that charities should not be exempt from the PPERA regime. It highlights that such an exemption would undermine the effectiveness of the PPERA regime and create incentives for campaigners to carry out as much campaigning activity as possible via charitable channels. Potentially that could have implications for the reputations of the charities.

I repeat what the commission said:

“It is the Commission’s view that it is right that charities are not excluded from within this legislation, and we believe the Government’s approach to distinguish by activity rather than by type of organisations is correct”.

The Government’s view, however, is that the nature of the PPERA test, to which I have referred, and the constraints of charity law will mean that the circumstances in which charities are brought within the scope of PPERA rules will be very rare. First, they must meet the PPERA test where their activities can reasonably be regarded as intended to promote or procure the electoral success of a party or candidate. Secondly, if they meet this test they must incur controlled expenditure over the registration threshold. The amendments that we will debate later and that are being brought forward by the Government to raise the registration threshold in essence will ensure that smaller or even medium-size charities will not have to register with the Electoral Commission.

I heard comments in Committee and in the meetings that I have had about the importance of trying to keep the administrative burden to a minimum. I accept that there was force in the concerns expressed when I first became engaged in this Bill and attended meetings with my noble friend Lord Wallace of Saltaire, in which charities said that there was a possibility that they could do something that took them into PPERA-controlled expenditure, with the limit at £5,000—£2,500 in Scotland, Wales and Northern Ireland. That might happen, without their knowing that there could be a freeze on their activity. But limits of £20,000 for registration are now proposed; in Scotland, Wales and Northern Ireland it is £10,000.

If charities are undertaking that level of expenditure this is neither unreasonable nor the sort of thing that will get lost in the loose change. It is significant expenditure. Therefore many charities will be removed from any concern by the thresholds that we are setting. Those approaching that level of expenditure may wish to consider whether it is appropriate. In terms of the general core principles of accountability and transparency in the Bill, it is important that if a body is undertaking the kind of activity that falls within this scope it should be accountable and transparent. In some of my discussions with the chief executive of OSCR, the Scottish charities regulator, he said that he thought that the transparency argument was important: if two organisations were doing exactly the same thing that brought them within the scope of the Bill or PPERA, it was wrong that one should have to be accountable and transparent, and the other, because it was a registered charity, should not. In transparency and accountability terms, this departed from an objective of the Bill.

Charities have raised concerns as to what happens if a party or a candidate adopts one of their policies. The Electoral Commission guidance is clear on this point. If a party or a candidate adopts a charity’s policy this will not automatically result in the charity incurring controlled expenditure. A charity will incur controlled expenditure only if it subsequently highlights the fact that party A or candidate B supports its policy, or ramps up its campaign. As such, the Government are not persuaded that there is a compelling case to take such a significant step as to exempt charities from the regulatory regime. It is the activities of the third party and not the type of organisation that should be subject to regulation. I can assure my noble friend, who raised the matter, as did other contributors to the debate, that the regulatory regime on charities will be explored during the review of third-party campaigning that we have indicated, as laid out in later amendments, will take place after the 2015 election.

We have had a good debate. I am not sure that I can elaborate these points much further. The noble and learned Lord, Lord Mackay of Clashfern, very properly made the point that the shape of the Bill will not be determined by the Charity Commission or the Electoral Commission; it will be done by Parliament, by your Lordships’ House and the other place. But, in doing so, it is important that we have some regard to those who have dealt with these issues in elections past, and to the Charity Commission and the Electoral Commission, which agree that the amendment proposed by my noble friend would not be appropriate in these circumstances. I therefore invite my noble friend to withdraw it.

Is my noble and learned friend saying, as a law officer of the Crown, that it is lawful for a charity in pursuance of its charitable purpose to do something that can,

“reasonably be regarded as intended to promote”,

the interests of a particular party or candidate?

My Lords, that has been the legal position since 2000. It is very rare that it would happen but, conceivably, there is a very limited range of activities that could fall within that. It would not be the intention of the charity but it might be reasonably seen by others to be the intention of the charity. It is because of that very limited possibility that it is important to maintain the provision as it is rather than implement the exemption proposed by my noble friend.

My Lords, I am grateful to my noble and learned friend the Minister for the way in which he summed up the debate. I am grateful to all those who have participated in discussing this important amendment. Given that Third Reading is on Tuesday, realistically there is not time to have the sorts of discussions that some noble Lords have looked for, particularly in terms of the speed at which the Charity Commission will move in relation to these sensitive matters. One has to look to the review of the workings of this legislation in the wake of the 2015 election. That will be vital. Having said that, I beg leave to withdraw the amendment.

Amendment 36 withdrawn.

Amendments 37 and 38

Moved by

37: Clause 26, page 13, line 20, at end insert—

“( ) In section 87 of that Act (expenditure by third parties which is not controlled expenditure)—

(a) in subsection (1), omit paragraph (a) and the “or” at the end of it;(b) omit subsection (2).”

38: Clause 26, page 13, line 23, leave out subsection (8) and insert—

“( ) After subsection (4) insert—

“(4A) It is a defence for any person or third party charged with an offence under subsection (2) or (4) to show—

(a) that any code of practice for the time being issued under paragraph 2 of Schedule 8A was complied with in determining whether any expenditure is controlled expenditure for the purposes of this Part, and(b) that the person or third party’s acts or omissions would not have amounted to an offence on the basis of the controlled expenditure as determined in accordance with the code.””

Amendments 37 and 38 agreed.

Amendment 38A not moved.

Amendment 39

Moved by

39: After Clause 26, insert the following new Clause—

“Arrangements between third parties notified to the Electoral Commission

(1) Part 6 of the Political Parties, Elections and Referendums Act 2000 (controls relating to third party national election campaigns) is amended as follows.

(2) In section 94 (limits on controlled expenditure by third parties)—

(a) after subsection (3) insert—“(3A) For provision requiring certain controlled expenditure to be disregarded in determining for the purposes of subsection (3)(a) whether a limit is exceeded, see section 94A(5) (arrangements between third parties notified to the Commission).”;

(b) in subsection (4), for “such a case” substitute “the case mentioned in subsection (3)”;(c) in subsection (5A)—(i) after “Subsections (3) to (5)” insert “and section 94A”;(ii) for “those subsections” substitute “those provisions”;(d) in subsections (8) and (10), after “the purposes of this section” insert “, section 94A”;(e) in subsection (11)(a), after “this section” insert “and section 94A”.(3) After section 94 insert—

“94A Arrangements between third parties notified to the Commission

(1) A recognised third party (“a lead campaigner”) may, at any time before the end of a regulated period, send a notice to the Commission—

(a) stating that the lead campaigner is party to an arrangement of the kind mentioned in section 94(6), and(b) identifying one or more third parties that—(i) are parties to the arrangement, and (ii) have agreed to be minor campaigners in relation to the arrangement.(2) A notice under subsection (1)—

(a) may not identify a third party as a minor campaigner if the third party is a lead campaigner in relation to the same arrangement, and(b) may not be sent by a recognised Gibraltar third party.(3) On receipt of a notice under subsection (1) by the Commission, a third party identified in the notice becomes “a minor campaigner” in relation to the arrangement in question.

(4) Controlled expenditure that is incurred during the regulated period in a part of the United Kingdom by or on behalf of a minor campaigner in pursuance of the arrangement is to be treated for the purposes of section 96 (returns as to controlled expenditure) as having also been incurred during the period and in the part of the United Kingdom concerned by or on behalf of the lead campaigner.

(5) In determining for the purposes of section 94(3)(a) whether a limit is exceeded by a third party in relation to a regulated period, controlled expenditure incurred in a part of the United Kingdom is to be disregarded if conditions A to C are met in relation to the expenditure.

(6) Condition A is that the expenditure—

(a) is incurred in pursuance of an arrangement that has been notified to the Commission under subsection (1), and(b) is, by virtue of section 94(6), treated for the purposes of section 94 and Schedule 10 as incurred by or on behalf of the third party.(7) Condition B is that the third party is, at the time the expenditure is incurred, a minor campaigner in relation to the arrangement.

(8) Condition C is that the total of the controlled expenditure incurred during the regulated period in the part of the United Kingdom by or on behalf of the third party (disregarding any expenditure in relation to which conditions A and B are met) does not exceed the limit for that part mentioned in section 94(5).

(9) Section 94(6) applies for the purposes of subsection (8).””

My Lords, Amendment 39 relates to arrangements between third parties notified to the Electoral Commission. In our earlier debates, this was referred to as the coalition issue—not be confused with the coalition—and in the meetings I attended with charities and campaign groups it was probably the issue that was raised more often than any other. My noble friend Lord Wallace of Saltaire agrees.

The Government received many representations to this effect and I would like to make it clear, as I have done on previous occasions, that this Bill does not amend the controls on third parties that each incur controlled expenditure as part of a coalition. In addition, only coalitions that incur expenditure that can, in the phrase we have been using,

“reasonably be regarded as intended to promote or procure the electoral success”,

of political parties or candidates are regulated and will continue to be regulated. Those rules are necessary and I will take a moment to clarify their operation.

Section 94(6) of PPERA requires that if two or more third parties work together to incur expenditure to a common plan or arrangement, the entirety of the expenditure they incur as part of that coalition must count against each third party’s individual spending limit. However, it is also important to be clear about what is not caught.

Organisations working together as coalitions on campaigns unrelated to electoral success would not be considered as working together for the purposes of PPERA. Make Poverty History is a very good example of that. The test is, as I said, whether their activities can,

“reasonably be regarded as intended to promote or procure the electoral success”,

of political parties or candidates. I hope noble Lords agree that the rules on coalitions are a necessary anti-avoidance measure. If third parties in a coalition did not have to count each other’s expenditure they would be able to evade the spending limits by splintering into many groups.

The Electoral Commission has also expressed its support for these rules, believing them to be necessary. I refer noble Lords to the Electoral Commission’s briefing before Committee stage, in which the current rules were described as,

“a vital element of the controls on election spending. Without these controls, individuals or organisations could spend unlimited sums of money by arranging for multiple ‘front’ organisations to campaign on the same issue. This would undermine the fundamental principle of controlling non-party campaigning”.

The Government agree with this sentiment but accept that small campaigners, by which I mean those that only incur small amounts of money when campaigning, should not be subject to unduly burdensome controls. That should be the case across the regime and, in relation to other aspects of the Bill, the Government have already tabled amendments intended to remove burdens from small campaigners.

I shall now explain how government Amendment 39 would work in relation to third parties that operate in coalitions. The Government cannot take full credit for this amendment, as it is inspired by and based on that put forward in Committee by the noble and right reverend Lord, Lord Harries of Pentregarth. I am grateful to him, to my noble friend Lord Tyler and to the noble Baroness, Lady Royall of Blaisdon, who also tabled amendments to the rules on coalition working in Committee, which led to a very useful and fruitful discussion. Other than some consequential changes, government Amendment 39 leaves unchanged the current Section 94(6) rules on coalition campaigning.

Instead, Amendment 39 introduces an entirely new provision. It has the effect that a third party can nominate another third party, one it is in a coalition with, to act as a “lead campaigner”. The original third party would then become a “minor campaigner” and provided that certain conditions are met, the minor campaigner would not then in any way be required to account for either its own expenditure or that of the wider coalition. Reporting to the Electoral Commission would be done only by the lead campaigner for its own expenditure and that incurred by the minor campaigner. The conditions that must be met before minor third parties can benefit in this way from the provision, are, first, that the minor third party’s expenditure must have been incurred as part of a common plan under Section 94(6); that the lead campaigner must notify the Electoral Commission of this arrangement and provide details of the minor campaigner before any expenditure has been incurred; and that the minor campaigner may not itself spend more than the limits that apply to the registration thresholds, either as part of this or another common plan, or independently.

It is on this last point that this amendment differs from that put down in Committee by the noble and right reverend Lord, Lord Harries of Pentregarth. The government amendment allows minor campaigners also to participate in one or more coalitions and campaign independently alongside. They must just ensure that they do not, across the various types of campaigns, incur total spend above the registration thresholds. Lead and minor campaigners would, of course, have to agree among themselves appropriate arrangements to ensure that the minor campaigner provided the lead campaigner with the necessary information for it to report, but I hope that this give some assurance to noble Lords that the Government have seriously considered the impact on small campaigners and taken steps to remove unnecessary burdens.

The Government believe that this amendment gives campaigners greater flexibility and better reflects the way that campaigners in coalitions operate in practice. I hope that noble Lords will accept that this amendment goes quite some way to addressing the concerns of those campaigners and that the smallest campaigners will not be unduly burdened with administrative obligations. I should add that the Government intend to bring forward several clarifying and consequential amendments to this provision at Third Reading. As noble Lords will know, it was a moving feast, and while we do not intend to alter the policy, the drafting can spell out more clearly the Government’s intention that there should be no restriction on there being more than one lead campaigner in an arrangement, and that the lead campaigner would report only for any minor campaigner it had identified in a notice. We think that this provides the flexibility that campaigners seek.

We also intend to make it clearer that a lead campaigner that has notified the Electoral Commission of this arrangement can supplement that notice to identify further minor campaigners. As I said, these clarifying measures are needed to ensure that the drafting of this amendment has the effect sought.

There are two further government amendments in this group, Amendments 63 and 64, which relate to Amendment 39. These are minor amendments, which make consequential amendments to the third-party reporting rules. I shall respond to the amendment in the name of my noble friend Lord Tyler after he has spoken. In the mean time, I beg to move.

As my noble and learned friend Lord Wallace has said, I and the noble and right reverend Lord, Lord Harries, the noble Baroness, Lady Mallalieu, and my noble friend Lord Cormack have a subsidiary but quite important additional amendment, Amendment 39A. I am sure that all four of us welcome the recognition that my noble and learned friend Lord Wallace has given to the fact that the 2000 Act—this is not about this Bill; it is about the 2000 Act—has caused real problems for any organisations that were encouraged to work together in what were then called coalitions. Since then, the term “coalition” has gained a different connotation, so perhaps we should talk just about “working together”. The way in which this matter was handled in 2000 has caused real concerns. I know from reading Hansard that this confusion was caused at the last minute by a government amendment during the Committee stage of the Political Parties, Elections and Referendums Bill, as it then was, in this House.

It is curious that, over the years since 2000, very few of us seem to have heard of the problems that were caused by those provisions. Neither the Electoral Commission nor the Charity Commission ever came forward and said that these matters needed review and either repeal or revision. However, we now know, because a large number of organisations have been in touch with many Members of your Lordships’ House saying that this is a real practical problem—hence the Government’s amendment, which is excellent so far as it goes. However, as I shall seek to explain in a moment, there is one additional problem which I hope my noble and learned friend will be able to say he can look at again, since, as he just said, there will be some additional clarification at Third Reading.

As my noble and learned friend has said, the new provisions should be a major help to smaller players in those joint campaigns, ensuring that others can account for their spending, but the approach in Amendment 39 does not go quite far enough. The fundamental problem with the so-called coalition arrangements in the 2000 Act is as follows. If, let us say, Friends of Earth intends to spend £300,000 on a campaign about climate change and does so in coalition with, for example, Oxfam, which contributes £25,000, under PPERA both are deemed to have spent, or to plan to spend, £325,000. Clearly, that is absurd, because that would mean that Oxfam, which had contributed only £25,000 to that campaign, might well then be precluded from doing anything else on other issues, which it is clear was not intended by the 2000 Act and which, I hope, is not something that we would intend to do today.

To prevent people working together and therefore having to multiply the spending limits under the 2000 Act by a factor equal to the number of organisations involved seems to be most peculiar. Removing the rules altogether would create another new loophole. I keep saying to colleagues in the third sector, “We’ve got to be very careful that we don’t increase flexibility for what we think is a good cause only to create a loophole for much less meritorious campaigning activity”. However, what is unfair about the rules is not that some spending on common campaigns is counted together to prevent an overall breach of the limits but the fact that spending by one organisation on one campaign can then restrict the campaigning of another organisation on a totally different campaign. In my example, Oxfam would be deemed to have spent £325,000 not just for the purposes of that climate change campaign but for all purposes. It would then be very close to the limit, which would then mean that it would have to worry about whether any of its other spending on, let us say, development targets could,

“reasonably be regarded as intended to promote or procure electoral success”,

of a party or candidate.

If that organisation’s trustees believe that the future spending could be so regarded, they would be left with a very small amount of headroom in the national spending limit even though they had contributed a relatively small amount of money to the tune of £25,000. Therefore, £25,000 spent on climate change would mean very little room left for spending on other development targets. I am sure your Lordships will see that that would not be just and right and does not meet the objectives either of the existing law or of this Bill.

Our Amendment 39A would build on the progress made by the amendment moved by my noble and learned friend Lord Wallace in setting out the principle that there should be an overall cap on spending by any one joint campaign or by any one individual organisation. However, new subsection (6B) proposed by my amendment states that,

“expenditure by a third party within the limits set out in Schedule 10 in pursuance of any matter unrelated to an arrangement and which could not reasonably be regarded as intended to achieve a purpose common to an arrangement”,

should not be so restricted by the coalition rules in PPERA 2000.

The amendment would provide for some affected organisations a silver lining in the passage of this Bill. In short, it would remove a very unjust element of the existing law which has caused quite unintended problems for many non-party campaigners. Their arrangements would be improved immeasurably. The amendment would also improve significantly what the Government have so far managed to come up with. I hope that my noble friends will recognise that the problems with the 2000 Act are considerable. This was one very specific problem that was caused to a large number of organisations. I hope therefore that before Third Reading, when, as my noble and learned friend has already indicated, there has to be some further clarification and therefore amendment of the set of amendments that he is putting before the House today, he could look also at this additional problem, which otherwise will go unresolved and continue to cause considerable difficulty for all sorts of organisations.

I, too, thank the noble and learned Lord, Lord Wallace, for the government amendment, which is a positive response to the suggestion put forward in our commission’s report, as he acknowledged. I have added my name to the amendment tabled by the noble Lord, Lord Tyler. I shall not repeat the reasons that he has already put forward, but it is an important amendment for charities and campaigning groups generally because they do a huge amount of campaigning not just with one coalition but with a whole series of coalitions. For instance, aid agencies may be engaged in a coalition on overseas aid and, at the same time, be engaged in a coalition on climate change. That is the way in which they work.

I want to make a point that has not been made so far in any of these debates. It concerns the fundamental purpose of this part of the legislation and whether it will achieve what the Government hope. The purpose of the legislation at this point is to stop front organisations drawing on large sums of money to distort campaigning, but I suggest that the legislation as we have it now will not have that effect. Let us take a hypothetical example. Six very strong anti-Europeans have dinner together. They have access to large amounts of money from various sources. They go away to different parts of the country and they decide to start six different campaigning organisations under different names. But, in fact, everybody knows that their purpose is to get Britain out of Europe. Would they be caught by this legislation? No. I have read carefully the briefing note presented by the Electoral Commission, which says that you are not working together—that is, you are not engaged in co-ordinated campaigning—if you have informal discussions with other campaigners but do not discuss your plans with them in any detail—all this party will have done is have dinner together; if you speak at an event organised by another campaigner but do not participate in other ways—they could even speak at each other’s events; and if you do not consult other campaigners about what you should say in your campaign or how you should organise it. However, it goes on to say that you can sign a joint letter together. I hope that the noble and learned Lord will take seriously the fact that the legislation as it now stands will not have the desired effect of stopping big money coming in and using front organisations. We firmly support the intent but we do not think that the Bill will achieve it.

My particular concern is that this will have a cramping effect on charities and campaigning groups, even with the government amendment and even if the amendment of the noble Lord, Lord Tyler, is accepted. I beg the noble and learned Lord, if not now, before Third Reading, or at least as part of the examination of how the legislation works afterwards, to try to engage in some lateral thinking. We have not been able to come up with anything satisfactory so far; neither have the Government. We must be able to engage in some lateral thinking to stop what we and the Government want to stop without at the same time cramping the co-ordinated coalition campaign which is so important to charities.

My Lords, I intervene very briefly. I tabled an amendment on coalition working and I am very grateful to the Government for adopting this way forward.

The other issue that charities raised frequently was the question of nil returns. I know that we shall come to nil returns later under government Amendments 81 and 89, but that, I hope, will cross-ruff into this amendment. In other words, we will make sure that when the new rules for coalition working come in charities will be able to take advantage of the nil return provisions, which the Government properly propose in Amendments 81 and 89. I should be grateful for the Minister’s clarification on that.

I, too, welcome the government amendments and repeat something that I have said on earlier occasions about the importance of getting the issues about coalitions right in relation to the criminal justice system. If you look at the transforming rehabilitation revolution, you will find that the Government are trying to encourage coalitions to take on the supervision of offenders. They consist of a large number of different organisations, private and voluntary, and it is important that they are crystal clear on anything to do with coalitions before they are formed to take on that very important public work.

My Lords, I detect self-restraint in the House at the moment, and I know that we need to move on rapidly, but I just wanted to say a word in support of Amendment 39A. I have to repeat what the noble Lord, Lord Cormack, said earlier about the value of charities generally within the political system and the role of networks, which have become so important and have been encouraged by government. If the noble Baroness, Lady Chalker, were here—she could not be here today—she would explain how the Government were siding with charities all the way through the 1980s and 1990s to achieve consensus with coalitions. The idea of attacking even the larger coalitions seems to be against the Government’s own policy.

The noble Baroness, Lady Mallalieu, said on an earlier amendment that a lot of damage had been caused by Part 2, but it must also be said that the Bill has strengthened the charities in opposition to it. That must be a force for good. But one damaging effect of the Bill, which was not intended by the Government, is that if it is unamended, many charities will become more wary in their campaigning. They will in many cases withdraw from the front line. I have been 40 years in charities and church organisations attending party conferences. What would they all be like without those charities displaying their wares, and so forth?

I know that the Government have come quite a long way to meet the smaller charities, but I do not think that they have moved far enough. The noble and learned Lord should recognise the injustice of netting so many legitimate activities just to catch one or two miscreants who would probably be recognised anyway in the context of a local constituency. Charities are usually pretty visible in what they do. The Electoral Commission itself says that we are talking only about a small number. Although the numbers add up and may increase, we are all in danger of exaggerating the number involved. It is the sledgehammer effect.

Surely, when there is disaffection with elections generally and with mainstream politics and politicians, we want more awareness among the public of the range of current non-party political issues. The amendment leads us in the right direction.

My Lords, I rise briefly to support Amendment 39A and, in doing so, very much welcome Amendment 39 introduced by my noble and learned friend. In Committee, I drew on my personal experience of being involved in coalitions of charities both previously and currently. It is very important —Amendment 39A achieves this—that even small and medium-sized charities are not restricted to being involved in only one coalition. I end by giving the example of when I was chief executive of a charity in the field of family relationships. At any one time, with a very small amount of money, we would be involved in a campaign to do with children and young people, a campaign to do with domestic violence, and a campaign to do with older people and the role of grandparents. All of those were important activities. We could never have done that ourselves; we simply did not have the money. That is why Amendment 39 is so important.

My Lords, I expressed appreciation for those who have welcomed Amendment 39, not least my noble friend Lady Tyler, because—I do not say this in any critical way—that is where we have managed to build on the amendment moved in Committee by the noble and right reverend Lord, Lord Harries. It would allow smaller charities, without reaching the threshold limit, to engage in a number of different campaigns.

I respond to the example used by my noble friend, and to the noble Lord, Lord Ramsbotham, and the noble Earl, Lord Sandwich, about the kind of campaigning that charities are doing. My noble friend talked about promoting grandparents’ rights, and I know that the noble Lord, Lord Ramsbotham, has a passionate interest in rehabilitation issues. As he said, the Government have encouraged the work of coalitions. One has to remember that to be subject to controlled expenditure, a campaign must fall within the definition set out in Clause 26. I honestly do not believe, without a huge leap of imagination, that the valuable work done by coalitions to promote the rehabilitation of offenders or grandparents’ rights could be interpreted as seeking the election or promotion of a particular party. By no stretch of the imagination could a reasonable person think that that was intended to secure the promotion of a particular party or candidate in an election. The noble Earl, Lord Sandwich, raised similar concerns.

The overwhelming amount of campaigning by charities will not fall within the definition of controlled expenditure here. I hope that that gives some reassurance, because I recognise the sincerity with which these concerns are expressed. Work that is being done to promote rehabilitation in prisons cannot be seen in any way as falling within the ambit and scope of activity that would bring it within PPERA-regulated controlled expenditure.

My noble friend’s amendment is intended to allow third parties that set up a coalition to move away from the common plan rules by allowing that coalition to have both its own spending limit and separate, individual spending limits for the members of the coalition. The coalition will be able to spend up to the national limit, and its members will also be able to spend up to the national limit on activities not taken forward as part of the common plan.

My noble friend was right to point out that the issue we are grappling with here has been in place since 2000; I accept that the range of activities increases under the Bill, but the problem has been with us since the outset. I point out that under existing legislation, there is nothing to stop a coalition establishing itself as a distinct third party. This allows the organisations and their members also to campaign on separate issues individually, with a separate spending limit.

The Electoral Commission has been very clear on this point, both in its guidance and in its evidence to the Commission on Civil Society and Democratic Engagement. That evidence gave the example of a lead campaigner which runs the coalition’s campaign and authorises its spending. Only the lead campaigner would be required to register with the Electoral Commission. Contributions to the coalition campaign from other third parties will be treated as donations or donations in kind to the campaign. In the words of the Electoral Commission,

“this means that the ... campaigners do not need to register themselves or report anything themselves to the Electoral Commission”.

Those campaigners would therefore be able to continue to campaign independently, too, to the maximum spending limit.

However, the Electoral Commission also made it clear in its Report stage briefing that it cannot support this particular provision. It noted that the amendment,

“would allow an individual or organisation to spend substantial amounts campaigning on an unlimited number of issues, as long as they are working together with someone else in each of those campaigns. For instance, someone could spend hundreds of thousands of pounds on each of a series of campaigns with others that attack different aspects of a political party’s manifesto in the run-up to an election”.

For example, it could be that you have an energy company that went into campaign with other energy companies, set up a coalition in favour of fracking and supported candidates who would support that. It could spend up to, say, £300,000 on that. Quite separately, under my noble friend’s amendment, it could be engaged in another campaign, with other participants, in which it tried to promote onshore wind power and could spend up to £300,000 on that. I am sure that that is not the intention of what my noble friend is proposing, but I fear that might well be the result his amendment would have.

I know that my noble friend has worked hard on this—as have many people—to try to find the right way to deal with this coalition issue. I do not believe that his amendment would have an effect that was helpful; and, as I indicated earlier, it is possible for a coalition to set itself up as a third party in itself. In these circumstances I invite my noble friend not to press his amendment, as it may have consequences that he does not intend. However, I hope we have indicated to the House, through the amendment that the Government have brought forward, that they have listened, have grappled with the issue and have built upon the amendment proposed by the noble and right reverend Lord, Lord Harries, in Committee.

Amendment 39 agreed.

Amendment 39A not moved.

Schedule 3: Controlled expenditure: qualifying expenses

Amendment 40 not moved.

Amendments 41 to 44

Moved by

41: Schedule 3, page 57, line 9, leave out “other public meetings or events (other than” and insert “other public events, other than—

(a) ”

42: Schedule 3, page 57, line 10, after “party” insert “, or

(b) any public procession or protest meeting, within the meaning of the Public Processions (Northern Ireland) Act 1998, in respect of which notice is given in accordance with section 6 or 7 of that Act (advance notice of public processions or related protest meetings)”

43: Schedule 3, page 57, line 14, at end insert—

“But expenses in respect of such events do not include costs incurred in providing for the protection of persons or property.”

44: Schedule 3, page 57, line 14, at end insert—

“1A (1) Nothing in paragraph 1 extends to—

(a) expenses incurred in respect of the publication of any matter relating to an election, other than an advertisement, in—(i) a newspaper or periodical,(ii) a broadcast made by the British Broadcasting Corporation, by Sianel Pedwar Cymru or by the Gibraltar Broadcasting Corporation, or(iii) a programme included in any service licensed under Part 1 or 3 of the Broadcasting Act 1990 or Part 1 or 2 of the Broadcasting Act 1996;(b) expenses incurred in respect of the translation of anything from English into Welsh or from Welsh into English;(c) reasonable personal expenses incurred by an individual in travelling or in providing for the individual’s accommodation or other personal needs;(d) reasonable expenses incurred that are reasonably attributable to an individual’s disability;(e) expenses incurred in respect of the provision by any individual of the individual’s own services which the individual provides voluntarily in the individual’s own time and free of charge.(2) In sub-paragraph (1)(d), “disability” has the same meaning as in the Equality Act 2010 (see section 6 of that Act).”

Amendments 41 to 44 agreed.

Amendment 45

Moved by

45: Schedule 3, page 57, line 14, at end insert—

“Exclusions of background staff costs1AA Nothing in sub-paragraphs (3) to (5) of paragraph 1 shall be taken as extending to any expenses incurred in respect of remuneration or allowances payable to any member of staff (whether permanent or otherwise) of the third party.”

My Lords, this amendment is very important for campaigning groups and charities, but I can move it very briefly: it is quite clear and simple.

First, let me say that the charities and campaigning groups, as part of the commission, very much support the aim both of transparency and accountability, and with that aim in mind support the extension of activities that should be regulated and are set out in new Schedule 8A. This amendment is about removing the background staff costs from those activities in sub-paragraphs (3) to (5) of that schedule. They refer to press conferences and media events; transport costs, when those are directed towards obtaining publicity—for instance, a campaign bus; and public rallies and other meetings.

We agree that all those should of course be brought into regulation, but this amendment is about excluding the background cost: that is, the cost of the member of staff of the third party. That is not primarily on cost grounds, but because of the additional bureaucracy that it would involve. How do you delineate the amount of time that the staff member spends—let us say, on mounting a public rally—from the amount of staff time they spend on their campaigning work anyway?

It is easy to assess the amount of money you are going to spend on hiring the hall for a public rally; you get an invoice for that. You do not get an invoice for a member of staff or the 10% of their time spent over four weeks doing that. Therefore, we think that the best thing to do is eliminate the background staff costs from the regulated costs in those three areas. It should be noted that the Electoral Commission recommends the removal of all staff costs, at least for the 2015 election. We are not going as far as that; we refer only to the background staff costs in relation to these three activities that are being brought into regulation. I beg to move.

My Lords, I strongly support the noble and right reverend Lord, Lord Harries, on this amendment. Indeed, we had very co-operative discussions about how best to tackle this problem. I am grateful to him and, indeed, to others who effectively endorsed an amendment we tabled in Committee on this crucial issue.

Given that there was much quotation of the Electoral Commission’s advice earlier, it is important that it has very explicitly said that Amendment 45 offers some advantages over the current position in the Bill. With this amendment, at least, we have that endorsement.

As I said in Committee, the Electoral Commission actually thinks that counting staff costs for political parties’ election expenses would be an appropriate way to proceed. Of course, that is not in front of us today; it may be for another day and another Bill. For the purposes of this Bill, the NGOs have been dealing with a considerable problem: namely, that the Bill includes not only staff costs on direct campaigning but what are called “background costs”.

As my noble friend will no doubt point out, staff costs for non-parties are already regulated for the production and distribution of election material. Our amendment suggests that this should continue but that costs should also be accounted for if they are incurred in direct relation to canvassing voters. In that context it seems that it would not be very difficult to identify the particular costs; equally, however, we do not want to increase the difficulties that could be caused by burdensome regulation on background costs that are not in any way so easy to account for. For example, the costs in relation to organising meeting rooms, travelling to a venue or setting up a press conference might be a matter of a few minutes of somebody’s time—and therefore, for many small organisations, a considerable absurdity.

Bluntly, I do not think that anyone cares if a policy officer, whose job for the rest of the year is something completely different, spends a little time booking a room for an election rally, or incurs costs travelling to it. These matters cannot be said to be likely to greatly affect the outcome of an election in that particular area, or nationally. However, if the regulations go through without us thinking about the implications, they could unnecessarily tie up campaigners in accounting for their time—and, worse still, could deter some from campaigning at all.

As was said so forcibly earlier, there are many organisations in this country—and thank God for them—that rely entirely on time being given voluntarily to this sort of activity. Would it be necessary to try to cost that time, or would it be difficult, in any case, whether they were employed or volunteers? Many a charity and many a non-charity would find that totally inconsistent with the Government’s intention of avoiding unnecessary spending on unnecessary bureaucracy.

This amendment, along with some of the others, helps the Government to do what they say they want to do. I hope, therefore, that my noble and learned friend will be able to find some way of making a sensible compromise on the whole issue of staffing costs.

The Government have moved sensibly in so many ways to try to meet the concerns and anxieties about the so-called chilling effect that many of us have understood to be the case with organisations with which we are involved. Many noble Lords are active members of charities and non-charities that do such important work in civil society today. Surely, the last thing that we want to happen is for the time, energy, enterprise, inventive activity and, indeed, the cost of those organisations to be unnecessarily distorted by new bureaucracy of the sort that could occur. Therefore, I very much hope that the Government will see that this is a sensible compromise on the whole issue of staffing costs.

My Lords, I have attended a number of meetings which the noble and right reverend Lord, Lord Harries, has convened and I, for one, am extremely grateful to him for the leadership that he has given and the amount of time he has devoted to the Bill over the past few months. Last week, following those meetings, I met with the chief executive officers of two important charities. I do not intend to name them because I did not say that I would, but when I asked them, “If we could get only one amendment through the House next week, where would your priority be?”, they said that it would be on staffing costs.

Any regulations imposed as a result of the Bill should be clear, simple and, above all, fair. The problem with this is that we would be faced with regulations that would be far from clear or simple, and which would most certainly not be fair. Because I do not want to take the time of the House when we have already had a clear and brief exposition from the noble and right reverend Lord, all I will say is: let us this evening make sure, as far as we can, that that clarity, simplicity and fairness is in the Bill.

I, too, am grateful to my noble and learned friend Lord Wallace of Tankerness and to the other Lord Wallace, my noble friend Lord Wallace of Saltaire, who we are all delighted to see back—but I urge them to go this one further step. They have done a great deal to try to make a bad Bill better; they can take another step this evening.

My Lords, the inclusion of staffing costs is hugely burdensome for large and small campaigning organisations. We have heard that tonight and we have all received e-mails and had discussions with campaigning organisations. Like the Electoral Commission, our preference would be for all staffing costs to be taken out for the 2015 election period. However, we recognise that this is an excellent compromise and I urge the noble and learned Lord, Lord Wallace, to accept it. Later on this evening the noble and learned Lord will be putting a review into the Bill, which could be an opportunity to revisit these things, so I very much hope that he will accept the amendment.

My Lords, I thank the noble and right reverend Lord, Lord Harries, for his amendment, because I, too, recognise that this issue has been regularly raised in many of the meetings that we have had—as did my noble friend Lord Cormack and the noble Baroness, Lady Royall. The noble and right reverend Lord’s amendment seeks to exclude those staff costs associated with staff directly employed by a third party from the calculation of controlled expenditure for transport, press conferences and organised media events, and for public rallies and public events.

The starting point is to recognise that the PPERA Act 2000 has always required third parties to account for staff costs. I acknowledge that the Bill extends the range of activities that may incur controlled expenditure; these are the activities that the noble and right reverend Lord seeks by his amendment to remove from staff costs. The Bill seeks to retain the need for staff costs to be included. As I said, I recognise that there has been concern, first, over the unfairness of third parties having to account for these costs when political parties do not. I think that my noble friend Lord Tyler mentioned that. Secondly, there has been concern about the difficulty for third parties in calculating the staff time attributable to activities giving rise to controlled expenditure.

On the issue of third parties having to account for these costs while political parties do not, your Lordships will be aware that when Parliament passed the 2000 Act it felt that it would be transparent and proportionate for a third party to account for staff time. This was on the basis that a third party undertakes campaigning activities other than simply political campaigning, and where a third party enters into political campaigning its spending for those purposes should be fully transparent. I am sure that that was the underlying thinking behind the 2000 Act. I would at least hope that someone who is employed by the Liberal Democrats during an election is actually working for the Liberal Democrats. Indeed, I am sure that the other parties would hope the same on behalf of their staff. It is as transparent as it possibly can be.

Regarding the concerns of third parties over the difficulties associated with calculating staff time, this is an existing element of the regulatory regimes. Its operation in the last two general elections, alongside Electoral Commission guidance on this, highlighted that such costs can be accounted for without becoming overly burdensome. The Electoral Commission takes a proportionate approach in current guidance to the calculation of controlled expenditure, including staff costs, by clearly stating that third parties should make an honest assessment of the costs that need to be reported.

I have shared with a number of the groups which have come to see me since Committee the fact that we did examine whether it would be possible to put in a de minimis exemption. Quite frankly, having seen what its terms would be, it would give rise to more concern about legal definitions than it merited, particularly if we had a de minimis exemption in statute. That would make it much more difficult for the Electoral Commission to take that proportionate approach to the calculation of controlled expenditure which it has done through its guidance.

It should also be noted that with the increases in the registration threshold the smaller organisations to which my noble friend referred, be they charities or campaigning organisations, will not be subject to regulation and the need to calculate staff costs. The best way of addressing the de minimis question is by what we have done in raising the threshold and taking so many of these organisations outwith the scope of controlled expenditure altogether.

My noble friend quite properly paid tribute to the work done by volunteers, not only for charities but for so many campaigning organisations. In many respects, they are the people who make the wheels of campaigning and democracy go round. However, volunteer costs will continue to be excluded from the calculation of controlled expenditure. In Amendment 44, which the House has just agreed, volunteer costs are excluded from the calculation of staff costs by virtue of paragraph 1A(1)(c) of new Schedule 8A. They were excluded under the existing regime, but it is important to emphasise that volunteer costs will also be excluded under what we are proposing. There is a world of difference between volunteer costs, which will be excluded, and the great advantage that there can be to candidates or political parties of third parties putting paid staff into campaigning activity in constituencies, or into running media events, press conferences or rallies.

The result of the amendment proposed by the noble and right reverend Lord, Lord Harries, would be to exempt that kind of expenditure associated with paid staff being moved in at the time of an election to facilitate the electoral advantage of a particular party or candidate. It is for that reason that the Government do not feel able to accept the noble and right reverend Lord’s amendment, and I invite him to withdraw it.

I am disappointed with the noble and learned Lord’s reply. This was a very simple step that the Government could have taken to ease the regulatory burden on charities and campaigning groups. It is disappointing. He stressed the fact that staff costs were already in PPERA. With due respect, that is no good reason for continuing them, if we have an opportunity to improve that Act and make it not just workable but one which eases the burden on charities and campaigning groups.

The Minister stressed that the Electoral Commission had found it possible to regulate this, but the fact is, as he knows, that charities and campaigning groups find this whole area very burdensome. I really do not see how the Electoral Commission can possibly police this area and work out what percentage of the time has been allotted, let us say, to the mounting of a public rally. What kind of receipts or statements is it going to get from the charity concerned? I am afraid that I find it very disappointing and I would like to test the opinion of the House.

Amendment 45A not moved.

Clause 27: Changes to existing limits

Amendment 46

Moved by

46: Clause 27, page 14, line 42, leave out subsection (1) and insert—

“(1) Section 94 of the Political Parties, Elections and Referendums Act 2000 (limits on controlled expenditure by third parties) is amended in accordance with subsections (1A) to (1E).

“(1A) In subsection (3), for paragraph (a) (but not the “and” after it) substitute—

“(a) during a regulated period—(i) any controlled expenditure is incurred in a part of the United Kingdom by or on behalf of a third party in excess of the limit for that part of the United Kingdom mentioned in subsection (5), or(ii) any controlled expenditure is incurred in a particular parliamentary constituency by or on behalf of a third party in excess of the limit mentioned in subsection (5ZA),”.(1B) In subsection (5)—

(a) in the opening words, for “(3)” substitute “(3)(a)(i)”;(b) in paragraph (a), for “£10,000” substitute “£20,000”;(c) in paragraph (b), for “£5,000” substitute “£10,000.”(1C) After subsection (5) insert—

“(5ZA) The limit referred to in subsection (3)(a)(ii) is 0.05% of the total of the maximum campaign expenditure limits in England, Scotland, Wales and Northern Ireland.”

(1D) In subsection (5A) for “(5)” substitute “(5ZA)”.

(1E) In subsection (10), omit the “and” at the end of paragraph (c) and after paragraph (d) insert—

“(e) the “maximum campaign expenditure limit” in a part of the United Kingdom is the limit imposed by paragraph 3 of Schedule 9 in relation to campaign expenditure incurred in the relevant period (within the meaning of that paragraph) by or on behalf of a registered party which contests all the constituencies in that part (and to which sub-paragraph (6) of that paragraph does not apply).””

My Lords, one of the aspects of the Bill that has received considerable attention and debate during our discussions, not only in your Lordships’ House but with campaign groups, relates to the registration thresholds, spending limits and constituency limits.

On registration thresholds, the point has been made repeatedly that small campaigners who do not incur much expenditure would be brought into the regulatory regime. This would, it has been claimed, impose undue administrative burdens on organisations that are not equipped to handle those responsibilities.

Noble Lords will recall that the Government have been considering this issue for some time. Indeed, my noble friend Lord Wallace of Saltaire gave a commitment on the first day in Committee that the thresholds would be revised. Extensive debate in Committee followed, at which representations were made to either revert to the existing PPERA thresholds, or to raise them further. I am grateful to my noble friend Lord Hodgson and to the noble and right reverend Lord, Lord Harries of Pentregarth, for leading that highly useful debate.

The Government have considered this matter and the appropriate level for registration thresholds further. Amendment 46 proposes to raise the levels to £20,000 in England and £10,000 in Scotland, Wales and Northern Ireland. The noble and learned Lord, Lord Hardie, has tabled an amendment proposing those levels be set at £20,000 for each constituent part of our United Kingdom. I simply observe that the Government’s amendment represents not only a substantial increase from the levels currently in the Bill, but reflects the original structure where the amounts were higher in England than in Scotland, Wales and Northern Ireland, no doubt due to the fact that there is a substantially greater number of constituencies and voters in England than in Wales, Scotland and Northern Ireland. Nevertheless, this is still a significant increase not only for England, but for Scotland, Wales and Northern Ireland, and it doubles the current registration thresholds in PPERA.

These thresholds will effectively exclude from the controls those campaigners who incur only small amounts of money. They will be able to campaign as they currently do, secure in the knowledge that unless they spend a substantial amount of money on controlled expenditure, they will not be subject to any aspect of the regulatory regime.

Bearing in mind what not only noble Lords but people outside sometimes hear in general debates or see in e-mails, it is also important to point out that these are thresholds for registration. It has sometimes been represented that there are limits on what organisations can spend, but the thresholds for registration are consistent with our objective of promoting transparency and accountability. We are maintaining the constituency limit of £9,750 throughout the regulated period to prevent a third party focusing a significant amount of its spending power on a small part of the United Kingdom.

Amendment 46 also specifies that, where a third party spends £9,750 in a constituency, it must register with the Electoral Commission. This is to ensure that the offence of spending more than £9,750 in a constituency is fully effective. I know my noble friend Lord Tyler is particularly interested in that point. As constituency limits apply only in relation to regulated periods involving a parliamentary general election, so the constituency threshold will have effect only in relation to such periods. We recognise that the current draft does not accurately reflect this, and the Government will accordingly bring forward an amendment at Third Reading to correct that.

In contrast, my noble friend Lord Tyler has proposed that rather than require a constituency registration threshold of £9,750, the registration threshold should be only £5,000. Reintroducing a lower constituency threshold than £9,750, as proposed by my noble friend, would only reinsert an extra layer of bureaucracy and confusion, particularly as the Government have also tabled Amendment 53, which would remove a post-dissolution limit of £5,850. The government amendment means that campaigners may spend the entire £9,750 throughout the regulated period, or just in the last few weeks before the election. Having just one constituency limit will be a much more straightforward and easier regulation to follow.

Finally, on spending limits, campaigners and Members of your Lordships’ House have sought to retain third parties’ spending limits at either the existing PPERA amounts, or even beyond those. The noble and learned Lord, Lord Hardie, and the noble and right reverend Lord, Lord Harries of Pentregarth, were clear on this point when we addressed this issue in Committee. The spending limits in the Bill for Scotland, Wales and Northern Ireland have particularly concerned campaigners. It has been argued that third-party campaigning in any part of the UK generally has a fixed cost; leaflets, for example, cost the same whether printed in Wales or England, and billboards cost the same, whether they are placed in Scotland or Northern Ireland. As a result, the spending limits for Scotland, Wales and Northern Ireland were felt to be disproportionately low. It is with that in mind that government Amendment 47 would uplift those limits by an extra £20,000 each. This would mean that there would be a spending limit of £55,400 in Scotland, £44,000 in Wales and £30,800 in Northern Ireland.

The Bill proposes spending limits for each of the parts of the UK which add up to £450,000. It is important to remind your Lordships that while these limits were initially to be over not quite a year—from the day after the European elections—if your Lordships approve our amendment which we will debate later, these will apply over the length of the reduced seven-and-a-half-month regulated period, which is also reflected in another government amendment. In fact, therefore, there is a larger amount in Scotland, Wales and Northern Ireland over a shorter period. Indeed, the amount for England is over a shorter period.

I have previously sought to explain that considerable amounts of campaigning can still be undertaken for that amount. In Committee, I gave the example of £390,000 buying a campaigner 40 million leaflets, a dozen front-page adverts in a national newspaper or even 780,000 telephone calls from a professional phone bank. I hope that noble Lords will agree that these government amendments as a whole will lead to a substantial increase in the registration thresholds and a significant uplift to the limits in the Bill for campaigning by third parties in Scotland, Wales and Northern Ireland.

I note that the noble and right reverend Lord, Lord Harries of Pentregarth, has further amendments on spending limits. I will respond to them when I wind up. I beg to move.

My Lords, before speaking to the amendment in my name, I thank the Government and the noble and learned Lord the Advocate-General for listening to the concerns from all sides of the House about the original proposal in the Bill to reduce the existing thresholds for registration as a recognised third party. The government amendment addresses these concerns and, rather than reducing the limits, they have accepted that the limits should be increased. It is appropriate that tribute is paid to the efforts made by the Government and the noble and learned Lord.

However, Amendment 46 does not address the anomaly that I mentioned in Committee, caused by having different registration thresholds for England and the rest of the United Kingdom. My amendment would remedy that by having the same registration thresholds throughout the United Kingdom. I noted that the Minister suggested that the distinction between England and the rest of the United Kingdom was the larger number of constituencies and voters. It is important to appreciate that there is a distinction that should be drawn between total expenditure by third parties in each constituent part of the United Kingdom, as against expenditure limits that determine whether the third party is required to register for recognition.

I accept that a distinction must be drawn between the various countries when one considers the total expenditure by a recognised third party in each country. That distinction reflects the number of parliamentary constituencies in each country and the greater number of voters in England than in any of the other three countries. That is the point that has been addressed since the 2000 Act, and is preserved in that Act, notwithstanding the amendments, in paragraph 3(2) of Schedule 10.

However, the threshold for registration is different. There is no justification for distinguishing between the different countries in this respect. The distinction was introduced in the 2000 Act, which followed the fifth report of the Committee on Standards in Public Life on the funding of political parties in the United Kingdom, which was presented to Parliament in October 1998. I referred to this in Committee and will not repeat these references. However, in Committee I explained that that report and the Government’s response to it never suggested any distinction between the different countries. There was a reference in a footnote which suggested that the reduced figure of £10,000 across the United Kingdom might be more significant in the three countries other than England, but it did not go as far as suggesting that there should be a difference.

I have been unable to find any subsequent explanation for halving the limit of £10,000 allowed for England in the other countries of the United Kingdom. I do not understand the need for a distinction when it comes to the threshold for registration. It is illogical and risks inhibiting local people from engaging in effective political debate about issues that are of concern in their constituency at a crucial time in the electoral process, by imposing upon them what my noble and right reverend friend Lord Harries of Pentregarth described at Second Reading as a,

“bureaucratic burden on small charities or campaigning groups, especially during the actual election period”.—[Official Report, 22/10/2013; col. 914.]

For example, suppose that a local hospital is threatened with closure and a group of individuals in the constituency wish to make this an issue at the general election but stop short of fielding their own candidate. If some candidates in that election support the retention of the hospital while others do not, the expenditure by the local group will be controlled expenditure. If this occurs in England, the pressure group can spend £20,000 before the need for registration and the administrative burden that entails, but if it occurs in Scotland, Wales or Northern Ireland, it can spend only £10,000. The expenses of running such a campaign in Scottish, Welsh and Northern Irish constituencies will be similar to those in many English constituencies. Do the Government seriously suggest that the cost of transport to meetings or venues of meetings in every English constituency is double that in any constituency elsewhere? In his reply, will the noble and learned Lord the Advocate-General explain the justification for this distinction?

My final point is that my amendment is not academic. Apart from being fair to all people across the United Kingdom who wish to campaign in the course of a general election about a matter of local importance to them, there is also a question of perhaps greater significance: that the consequences of not registering but exceeding the registration threshold are a criminal offence under Section 94 of the 2000 Act. Why should electors face prosecution in Edinburgh, Cardiff or Belfast for spending £6,000 on a campaign without registering as recognised third parties but have immunity in Newcastle for identical activity?

I have a separate amendment in this group. We all welcome the way in which my noble friend Lord Wallace of Saltaire and my noble and learned friend Lord Wallace of Tankerness have responded to the request for an increase in the registration thresholds. This was a key recommendation of the commission headed by the noble and right reverend Lord, Lord Harries, and it certainly deserved to be listened to.

In this last-minute change to the Government’s position, however, there is one new outstanding problem. The interaction between the national thresholds for registration and the constituency limits in the Bill simply do not hold together. As we will discuss in the next group, I believe very strongly that the constituency limits are a very important part of this Bill. Indeed, I am sure Members on all sides of your Lordships’ House are aware that if we did send back to the other place a Bill that did not deal with this point, many people there would think that we were not doing our duty.

For the constituency limits to be effective, those who spend at a constituency level will surely need to make an expenses return about what they are spending. The rules in the 2000 Act and in the Bill rightly also ask where the money is coming from. There is, however, a problem. As the Bill will stand in the light of these new government amendments, someone could be spending £9,750 in a constituency, or indeed could spend £19,500 across two English constituencies, yet would not have to register. The registration limit is now raised to £20,000, and therefore that spending and its sources would be totally opaque. It would not be transparent even though £9,750 could have a significant impact on the constituency result.

In my own amendments on thresholds in Committee, I suggested that this problem could be dealt with by stipulating that the threshold should be at a particular level which would take that into account. The Government have chosen £20,000, and that is fine, except that all the spending could be concentrated in one target marginal constituency. A group could spend a significant sum—I am suggesting £5,000 in my amendment—all in one place. Surely in those circumstances it should have to register.

The Government’s answer has been that somebody who spends more than £9,750 in one constituency will be committing an offence under their proposals. If that someone does not have to register, because he is below the new registration threshold, how can anyone know that he is committing that offence? I cannot think—and I know a little bit about these things—of any other part of electoral law in which someone who is subject to a spending limit is yet not required to produce any paperwork on what he is spending. Introducing that concept now would make for a completely absurd anomaly.

Will the noble Lord not agree with me that there would be more logic in having a figure that was close to that which an individual candidate is entitled to spend? No individual candidate is entitled to spend as much as £20,000 in any constituency in the United Kingdom.

My noble friend is right. He and I have relatively recent experience of these things. The normal figure is around £12,000 during the election period. As I will come to in a moment, that could be swamped under these proposals, and therefore this is an absurd anomaly. I understand why the Government have arrived at their position. Their formula sounds simple, but it may be so simple as to be unequal to the task in hand. Equally, the move in Amendment 53 to do away with different limits for constituency spending seven months before an election, and constituency spending seven days before, seems to me to lose what is an important and not particularly complex distinction in the name of simplicity—and I am not sure the Government have got this right.

I ask the Minister to consider carefully the horror story that could emerge. Imagine: a campaigning group could come into a constituency and spend £19,999.99 in the last seven days of the campaign with the aim of affecting the outcome in that constituency, and it would not need to register. A second group, unrelated to the first, could, during those seven days, do the same. It would not register. A third group, unrelated to the other two—not a coalition, not working together— could do the same. In the last few days of a campaign in a marginal constituency, just under £60,000 could be spent, completely swamping the amount permitted for a candidate and a party, which is around £12,000, in one constituency. The candidates are, as I say, limited in those final four to six weeks.

Because this spending would not be registered, it might not be revealed until after polling day. Think of the mess that that would cause to our electoral law. Because such groups, though technically in breach of the law, would not need to register, no one would be any the wiser about what they had been up to. My noble and learned friend has said that he is looking at this section with a view to some clarification, and I think he will have to agree that there is a major loophole looming in front of us. I therefore request that he look carefully at Amendment 46ZA. He may find a better solution but a solution must be found, otherwise political parties and those who will be looking at this legislation when it goes back to the other place will not have seen this particular problem, because until now the registration threshold has not been so high. It is only under the present Government’s changes in this House that it has been raised to this height.

I hope that my noble and learned friend will be able to give some reassurance to those of us on all sides of the House who are concerned about such spending that the Government are not prepared to accept this loophole.

My Lords, Amendment 46A in my name concerns the spending cap for England. First I would like, on behalf of the commission, to warmly welcome the raising of the registration thresholds by the Government. I think that has done more than anything else to reassure the smaller charities; we give the Government a very warm thank you. We also warmly welcome the raising of the spending cap for Wales, Northern Ireland and Scotland. The spending cap for England, unlike that for Wales, Northern Ireland and Scotland, has been reduced by 60%. That reduction has taken place with an increase in the number of activities to be regulated and without taking inflation into account.

It is true that not many campaigning groups and very few, if any, charities would spend a high figure coming anywhere near that. The one I have checked that does spend quite a lot of money is Hope not Hate, which campaigns against racism all over the country. It is not a charity but a campaigning group. In 2010 it spent £319,231. That is very nearly the limit for England as we have it under the Bill, which is £319,800.

There was no evidence of abuse with the previous spending caps for England, and no rationale has been given for this reduction by 60%. Even if the Government are not willing to revert to the PPERA limits for England, I ask the Minister whether he sees any scope for some kind of compromise between the drastic reduction which has been brought about by the Bill and the spending limits there were for PPERA.

My Lords, I will add just a few words to what I said a few minutes ago. I fought 12 general elections, in 10 of which I was elected, to go to the other place. In every one of those the expenditure that I was allowed was very clearly defined. The returns that one had to make afterwards were minutely examined, and there have been cases within our memory where candidates have been challenged on their returns because they were a little careless in submitting them. We have to be extremely careful. The last election I fought was in 2005, and if I remember rightly I was allowed to spend around £8,000 or £9,000. My noble friend says that it is now about £12,000, and I accept that—I am sure he is right. It was all very carefully defined, and we have to be careful, much as we all want to protect free speech and engagement in campaign and all the rest of it, that the expenditure of candidates who stand for particular political parties or as independents is not put into the shade by the expenditure that is allowed to campaigning organisations within individual constituencies. Although I do not suppose that my noble friend Lord Tyler will push his amendment to the vote, I hope that the Minister will reflect upon what he and I have said.

My Lords, when at these debates, I have always felt that not enough attention is paid to the real danger of our fragile system of controlling election expenditure beginning to break down altogether. I am strongly in favour of charities having the right to campaign and being free to speak out about what they believe—that is absolutely right—and a huge contribution is made to us as a society in that way. Frankly, however, I am frightened that here, on the edge of the Third Reading of the Bill, we have observed and commented upon two huge anomalies that are still with us and still in the Bill, which open the door to the misuse of some aspects of the Bill in a way that would make the holding of that line against the misuse of public and private expenditure very difficult to hold.

Throughout my whole political life I have been very conscious, like the noble Lord, Lord Cormack, of the importance of the restrictions on the amount of money that passes into the British political system and what a huge benefit that has been to us in terms of retaining a democracy that is genuinely a democracy of the right of every individual to vote. Some of my colleagues in this House will know that I have been very much affected by the recent history of the United States, having been for 10 years an elective politics professor at Harvard, between 1986 and 1996. I will quickly say what so frightens me.

In 2010, the American Supreme Court decided to lift all restrictions on what amounts of money could be given by either corporations or trade unions directly to campaigns at the federal level. One of the outcomes of that—a decision that was made, let the House not forget, in 2010—was that in 2012 no less than $6 billion was poured into federal elections in the United States in a one-year electoral cycle. That was not enough. The sweeping away of all those restrictions was based upon the constitutional right of free speech, in my view distorted in a very troubling way. Today, the Supreme Court of 2014 has on its agenda yet another proposal, McCutcheon v Federal Election Commission, which would enable any individual, without restriction, to contribute any amount he or she wishes to the election of an individual named federal candidate—in other words, it is back to Eatanswill and the buying of politicians.

The United States is a great and very open democracy, but we are rapidly seeing the gradual distortion of its democracy by huge expenditure of money for other purposes than simply a desire to register a particular campaigning goal. I fully take the point that every step that can be taken has been taken to avoid that in the Bill. I am dubious about the proposal of the noble and learned Lord, Lord Hardie, to increase substantially the limit. However, I appreciate that the original limit was almost certainly too drastically cut. There is a median way there.

I will not detain the House for very long, but two things that have been raised in this debate trouble me very much. One is the example given by my noble friend with regard to the possibility of piling together expenditure in one or a small number of constituencies. The wording of the Bill adequately defends against that real temptation, which could have a major effect in the case of particular named persons that others would like to see taken away from Parliament. The second danger was reflected in the very wise remarks of the noble and right reverend Lord, Lord Harries of Pentregarth, when he gave us the example of a number of individuals who met for dinner together who decided each to set up their own particular little group and that that little group would then go for a particular objective. There would be nothing to link the two in such a way that they would count as a coalition group under the legislation before us.

I do not wish to detain the House at this late hour, but those anomalies are still only too patently with us. They open an opportunity for serious misuse of the Bill and of the electoral expenditure system. Given what we as a House and the other place have been through as regards other expenses, it is vital that we make sure that those anomalies are dealt with, that the Government consider what to do about them, and that before this legislation passes into history, serious thought is given to how the Electoral Commission in the non-charity field can make moves to try to look into any questions of this kind.

I will conclude with a rather dramatic fact. In the United States a special element in the American tax system enables non-party, non-governmental organisations to contribute to electoral expenditure on the basis of being exactly what we have been talking about—non-party, non-governmental organisations. That has seen expenditure of that source rise from $10 million in 1988 to $470 million last year, and rising. It has become the most significant single source of expenditure in elections on candidates by non-partisan, non-governmental organisations. We should be warned.

My Lords, I thank all noble Lords who have contributed to this debate. I express particular appreciation of the welcome that has been given to the very significant increase in the registration thresholds that the Government have brought forward and to the uplift in the spending limit in Scotland, Wales and Northern Ireland. To follow on from my noble friend Lady Williams, it is certainly useful to remind ourselves, as she also did very eloquently in Committee, of the core purpose of the Bill, which is to ensure that our electoral and democratic system is not hijacked by people who can spend large amounts of money without proper accountability, and that there is proper transparency. It is important that we keep those important points in our minds when we consider the different measures.

Perhaps that is consistent with the point made by my noble friend Lord Tyler, which I addressed in my opening remarks, on not wanting a particular constituency to be overwhelmed. He proposed a threshold of £5,000 and said that he did not wish to find a situation where an organisation could come rattling into a constituency with one week to go, spend £19,999, get away with it and not be accountable for that. It is important that the Representation of the People Act might have a certain impact on that kind of expenditure, if it offended that Act; under the Bill that expenditure is increased from £500 to £700. I ask my noble friend to reflect on that, although I know that he does not overlook it as he knows full well about it.

But, more importantly, there is not that kind of loophole. My noble friend seems to have overlooked—and I did try to draw his attention to it in my opening remarks —that it will be an offence under the Bill to spend more that £9,750 in a constituency, even where the RPA does not apply. One of the consequences of a situation where we are amending another piece of legislation is that it is not always self-evident. Amendment 46 says:

“In subsection (3), for paragraph (a) (but not the “and” after it) substitute … (ii) any controlled expenditure is incurred in a particular parliamentary constituency by or on behalf of a third party in excess of the limit mentioned in subsection (5ZA)”.

I think that the purpose of that is in fact to make a registration requirement if the constituency limit of £9,750 is reached, or at least that is what I am reliably advised and I know that it is certainly the intent that there should be a registration of the maximum for each constituency to make more effective the criminal sanction that will follow if a party or third party spends in excess of £9,750. His example of spending £19,000 could not actually happen under the Bill, in line with the proposed amendment.

Whether it is £9,000 or £19,000, my general point is that I have been unable to find anything in electoral law where there is a spending limit but no paperwork for anybody to provide that shows that they are keeping within that spending limit. It seems to me that there is a potential anomaly. I am just asking my noble and learned friend to be absolutely certain before, as has been said, we send back to the other House a potential anomaly in these circumstances.

My Lords, I do not think that there is an anomaly. One of the reasons for putting in the registration requirement was to try to address the kind of anomaly that my noble friend mentions. We share the same objective and if he thinks that there is a loophole there then I will certainly make sure that we look at that, because these provisions have been worked up over recent days. I think that it is okay, but it is probably quite good counsel that we should check to make sure that that is in fact the case.

The noble and learned Lord, Lord Hardie, made his case for having similar registration thresholds in Scotland, Wales and Northern Ireland as in England, and I can see some force in what he is saying. He says that he has not been able to divine why there has been a difference, which has been in place since the very outset. Since PPERA, a distinction has been made: it was £10,000 for England and £5,000 for Scotland, Wales and Northern Ireland. I will not allow myself the cheap debating point that that was what the noble and learned Lord proposed in Committee, but I think that his purpose behind that was to make sure that the Government considered the threshold properly.

It is interesting too—I will finish this point and then let the noble and learned Lord come in—that what is actually proposed by the Government is also the architecture proposed by the commission chaired by the noble and right reverend Lord, Lord Harries of Pentregarth. The commission report proposes £20,000 for England and £10,000 for Scotland, Wales and Northern Ireland.

I was going to say that I would not add such an adjective. The noble and learned Lord will remember that I tabled two amendments: the first was to preserve the status quo and the other was to seek an increase in the limits. As the noble and learned Lord has much more experience in political matters than I have, he will appreciate that it is useful to have a stop-gap in case the main objective is not achieved. In relation to the comment about the point made by my noble and right reverend friend Lord Harries, the noble and learned Lord might remember that, in Committee, when the noble and right reverend Lord was speaking, having heard my suggestion that there should be uniformity for registration levels, he indicated that he thought that there was some force in that and that it had not been a point considered by the commission.

My Lords, I was going to say that I was aware that the noble and learned Lord had also tabled an amendment in that group to raise the threshold to provide an equalisation—at, I think, £25,000 if my information serves me correctly.

It is a fair question as to why there is such a difference. I think one of the reasons, which I gave at the outset, is that there is a difference in the number of voters and number of constituencies. It is also the case that spending of less than £20,000 could have a more significant impact in, say, Northern Ireland, which is a very compact area with a very focused media. Spending of less than £20,000 could have a much more significant impact there than in England, and I suspect that the different political and media circumstances was one of the considerations as to why the difference came about in the first place.

There are one or two points made by the noble and learned Lord that I could not quite follow. He said that if there was a hospital closure in a particular constituency, a pressure group could spend up to £20,000 in England but just under £10,000 in Scotland. Of course, following on from the debate that we have just had about constituency limits, they would be restricted to £9,750 in Scotland, Wales, England and Northern Ireland regarding the kind of example that he gave. He suggested—I apologise if I misheard him—that someone could be prosecuted for spending £6,000 in campaign expenditure in Edinburgh but not in, for example, Birmingham. I think that he will accept that, with a £10,000 threshold, that would not happen in either Birmingham or Edinburgh. I do not think that I misheard him, but sometimes people get that impression and suddenly there are concerns.

The noble and learned Lord is correct; it was a mistake on my part, I should have said £12,000. The point was that it is simply over the limit in Scotland but under the limit in England.

My Lords, we recognised the core expenditure that was needed in Scotland, Wales and Northern Ireland in order to mount campaigns and that has been reflected by—for the first time, actually—making a distinction and giving an uplift for Scotland, Wales and Northern Ireland over and above the percentages that have otherwise been applied.

The noble and right reverend Lord, Lord Harries of Pentregarth, proposes reverting to the total national spending limit of £988,500. As I have explained, the Government have brought forward amendments to increase spending limits for Scotland, Wales and Northern Ireland but, as I explained in Committee, only a few political parties at the last general election spent more than £390,000—the total now would be £450,000—on the full range of activities that we now wish to extend to third parties. Only the Conservative Party, Labour Party, Liberal Democrats and UKIP spent more than £390,000 and, I assume, more than £450,000.

As my noble friend Lady Williams said, there are risks associated with allowing third parties to incur vast amounts of spending. Given that third parties campaign for or against electoral success of political parties, it is a very reasonable assumption that a relationship can and does develop between some third parties and political parties. This opens up the potential for supporters of political parties to demonstrate their backing by diverting their funding to an aligned third party and away from the political parties themselves, which have their own limits. I do not think it is right that, where limits are imposed on political parties, they can be circumvented in this way.

Even the limits that we have allow very extensive campaigns to be mounted. I do not wish to indulge in too much repetition, but £390,000—and of course it has gone up by £60,000—is 40 million leaflets, a dozen front-page adverts in a national newspaper, or 780,000 telephone calls from a professional phone bank. These are not insignificant campaigning activities and I therefore believe that the judgment that we reached in coming to these figures is the right one.

I therefore urge the House to support the Government’s amendments with regard to thresholds and I invite noble Lords not to press their amendments.

Amendments 46ZA and 46ZB (to Amendment 46) not moved.

Amendment 46 agreed.

Amendment 46A not moved.

Amendments 47 and 48

Moved by

47: Clause 27, page 15, line 3, leave out from “substitute” to end of line 5 and insert “—

(a) in relation to England, 2% of the maximum campaign expenditure limit in England;(b) in relation to Scotland, £20,000 plus 2% of the maximum campaign expenditure limit in Scotland;(c) in relation to Wales, £20,000 plus 2% of the maximum campaign expenditure limit in Wales;(d) in relation to Northern Ireland, £20,000 plus 2% of the maximum campaign expenditure limit in Northern Ireland.”;”

48: Clause 27, page 15, line 6, leave out paragraph (b)

Amendments 47 and 48 agreed.

Clause 28: Constituency limits

Amendments 49 to 51

Moved by

49: Clause 28, page 15, line 29, leave out from “(10),” to “insert” in line 30 and insert “after paragraph (e) (as inserted by section 27)”

50: Clause 28, page 15, line 38, leave out from “exceeded” to end of line 41 and insert “0.04% of the total of the maximum campaign expenditure limits in England, Scotland, Wales and Northern Ireland;”

51: Clause 28, page 16, line 1, leave out paragraph (c)

Amendments 49 to 51 agreed.

Amendment 52

Moved by

52: Clause 28, page 16, line 22, leave out from “if” to end of line 23 and insert “the expenditure relates to—

(a) sending election material falling within paragraph 1 of Schedule 8A which is addressed to electors (whether addressed to them by name or intended for delivery to households within any particular area or areas);(b) unsolicited telephone calls falling within paragraph 2 of Schedule 8A, made to such persons or households, which may reasonably be regarded as intended to ascertain or influence their voting intention.( ) For the purposes of this paragraph, “election material” is defined as in section 143A.”

My Lords, this amendment, which I am moving on behalf of a number of noble Lords in different parts of the House, deals with some small changes to a previous amendment that we looked at in Committee on constituency limits, but they are changes that I know will be very welcome to a number of organisations which have been in touch with several Members of your Lordships’ House. It received considerable support across the Chamber in Committee and has two compelling advantages to recommend it.

First, it retains the Government’s intention to have a constituency limit. That is surely central to the Bill. As I have said consistently, I strongly support that and I know that a large number of other Members of your Lordships’ House also think it is important to retain that. However, even if we were to take it out, as some have suggested, I would certainly expect that Members of the other place would need no whipping at all to put it back in, for the reasons that were advanced so eloquently by my noble friend Lord Cormack a few minutes ago. Surely even Labour MPs would want it to be put back in.

The second advantage to the amendment is that it very closely and carefully defines what the constituency limits should apply to. As many charities and NGOs, big and small, have pointed out to me and to other Members of your Lordships’ House, they are not used to dealing with constituency boundaries; they have quite a different sort of geography from those of us who are involved in politics. Therefore, trying to assess the relative effect of, say, a rally in different constituencies would be quite problematic. It would be problematic for the political parties too, and for that reason we, as politicians, are not asked to account for it.

I shall give a practical example. I once chaired a rally for the five constituencies, as they then were, in Cornwall, and it took place in one particular constituency. It just so happened that we won all five seats but that did not have anything to do with my chairmanship at that rally. However, how would the costs of that rally be allocated to each constituency? You could allocate the costs to one constituency but what about the other four? That clearly is not what this Bill is all about. It really is not possible to measure the effect of a rally, or indeed a billboard or a press conference, on the result in an individual constituency.

I have one other example. I lost a lot of hair—or, rather, most of it went grey—in two elections arranging the national tour of the battle bus for the then joint leaders. Your Lordships may remember that at one stage we had two leaders in the alliance—the two Davids—although they did not always see eye to eye. That caused me a great deal of aggro. However, how I would ever have accounted for five minutes in this constituency, 10 minutes in that constituency and an hour in that constituency if I were running a campaign on behalf of a non-political organisation is quite beyond me.

Amendment 52, on which I am very grateful for the support of the noble and right reverend Lord, Lord Harries, the noble Lord, Lord Cormack, and the noble Baroness, Lady Mallalieu, would limit the scope of the constituency regulations to just activities where people communicate with specific voters. The one advantage of this amendment is that it ties down very specifically the activities that target specific people at a specific address in a specific constituency—letters or leaflets sent or delivered to voters, or telephone calls directed specifically to them—and which try to influence or ascertain their voting intention. Other activity would still have to be accounted for but only on a national basis. Therefore, if it is the national tour of a battle bus, arranging rallies or whatever, that has to be accounted for nationally but under the more generous national limits.

What has been made clear to us by many organisations which think that they may be involved in the activities covered by the Bill is that, if they are asked to account only for those activities that specifically target specific individuals, that will make their lives a great deal easier. It will retain the central purpose of the Bill, which is to stop big-money campaigns dwarfing the limits that candidates have to adhere to—my noble friend was very eloquent on this point a few minutes ago, as was my noble friend Lady Williams—and it will mean that the additional costs of activity directed at specific candidates can be identified neatly, clearly and succinctly.

The Electoral Commission has very clearly endorsed this amendment and expressed clear support for it because it makes simpler the guidance that it will have to give and the subsequent monitoring that it will have to undertake. I beg to move.

I support the amendment for the reasons that the noble Lord has set out. Constituency limits have been of very great concern to charities and campaigning organisations. I am fully aware of the kind of concerns raised by the noble Baroness, and, as the noble Lord, Lord Tyler, indicated, this issue has also been a very great concern for the Electoral Commission because it does not see how it can regulate and enforce this area. The noble Lord’s amendment will make it far easier for charities to be regulated by the law and for the Electoral Commission to regulate it.

My Lords, an amendment that can produce a joint letter from the National Secular Society and the Christian Institute clearly deserves careful consideration. When they take into account that the Electoral Commission also believes that there is good sense in this proposal, I hope that your Lordships will feel likewise. I hope that we will not have to exercise ourselves by going into the Lobbies. I hope that my noble and learned friend will be able to indicate at least a significant degree of sympathy with this and, if he cannot accept these precise words, that he will undertake to come back at Third Reading next week with something similar.

My Lords, we also strongly support the amendment. It is not the provision’s intention that we have problems with but its workability. It will add an enormous bureaucratic burden. When people campaign against the proposed path of HS2, flight paths around Heathrow or fracking and so on, that is not divided up by constituency. It is strange that a Government who are cutting red tape elsewhere, and who on Monday said that they could not possibly ask special advisers to list their meetings with lobbyists, seem to want this for really small organisations. Amendment 52, which limits the requirement to telephone calls and literature aimed at households, is immensely sensible. I hope that the Government will do one of two things: either accept the amendment or put off their new rules until after the next election.

My Lords, we have just had a discussion on constituency limits, and it was also covered extensively in Committee. The House has agreed to a government amendment to remove the post-Dissolution limit to make the provision less complex, yet there remains some concern about it. From what was said in a previous debate, I think that my noble friends Lord Cormack and Lord Tyler believe that there should be some limit on constituency spending. My noble friend Lord Tyler argued for a lower limit but now wants lots of expenditure to be incurred without any limit at all. That is a concern that we have.

It is important to put this in context. Constituency spending limits do not replace the existing controls under the Representation of the People Act 1983. Those long-standing rules stipulate that third parties campaigning for or against a particular candidate may spend only up to £500 in doing so. Other than raising that amount to £700, and requiring records to be kept of such expenditure, this Bill does not affect those provisions.

In contrast to the RPA rules, Clause 28 introduces a new limit on how much a third party that is promoting the electoral success of parties, or candidates who support particular positions, can spend in individual constituencies. As has already been explained, the limit is £9,750. The reason for this amount—which might, on the surface, appear somewhat odd—is that it is equivalent to 0.05% of the maximum campaign expenditure limit applied to political parties. This limit will apply for the duration of the regulated period for a UK parliamentary election.

As has already been rehearsed, the need for constituency limits is profound. It is not right that candidates and parties should effectively be bowled out of the field purely because well funded campaigners are able to outspend them. Elections are the principal domain of political parties and candidates, and those who are not campaigning for their own electoral success should still be able to participate: that is the essence of our democracy. However, in these circumstances, we believe that the voices of such campaigners do not diminish the voices of the political parties and candidates and that constituency limits will ensure that.

The Bill makes clear that a third party’s expenditure would be wholly attributed to a constituency only if that expenditure had “no significant effect” in any other constituency. That means expenditure in a local area could, of course, be attributed to several constituencies if the effect was felt in them all. Expenditure with a wider regional, or even national, reach would be attributed proportionately to all the relevant constituencies.

My noble friend Lord Tyler has proposed an amendment to dampen the effect of these constituency limits. The amendment proposes that only certain costs —in other words, only expenditure related to certain activities—should count towards constituency limits. Specifically, the amendment says that only costs associated with election materials should be counted. That would mean the costs related to leaflets, mailshots and adverts, all of which must also have been either specifically addressed to or delivered to households in a constituency, and unsolicited telephone calls to such households.

I recognise the issue which my noble friend is trying to address, but I believe there are drawbacks. For instance, significant activities such as rallies and events would not be regulated at a constituency level if his amendment passed. I gave some of my colleagues an example of Scottish Liberal Democrat pre-election rallies in Edinburgh East. Anyone who knows Scotland will know that Liberal Democrats would not be spending money in that constituency; no doubt Edinburgh East Liberal Democrats will now write to me and say, “Do not let us down”. That was a national campaign, but an event in my own former constituency could not, by any stretch of the imagination, relate to any other—not even Caithness, Sutherland and Easter Ross.

In addition, material otherwise distributed or displayed would also not count towards the constituency limit. A third party could therefore freely distribute leaflets by hand in a town centre, or, indeed, in shopping areas in different parts of a constituency, in the knowledge that, because they are not being delivered to voters’ homes, the associated costs need not be accounted for in that constituency’s limit.

We are concerned that these are key gaps which would allow a third party to target an area by holding large partisan events, or flood an area by handing out election material in the street or in shopping precincts. Allowing only certain activities to count towards constituency limits would undermine the entire principle of constituency limits, on which my noble friend spoke so eloquently earlier. For that reason, I urge my noble friend to think again and to withdraw his amendment.

My Lords, I am rather disappointed by that. Throughout today’s debate and, indeed, on previous occasions, many noble Lords—particularly my noble friends on the government Front Bench—have quoted the advice of the Electoral Commission. I apologise to the House for detaining it for a minute, but this is what the Electoral Commission says about this amendment:

“In principle, we support Amendment 52, tabled by Lord Tyler and others. It narrows the scope of the constituency limits so that they only cover spending in respect of election material sent to voters and households in a constituency, and unsolicited phone contact with such voters”.

Then, in heavy type, it continues:

“We see benefits in defining the scope of activity covered by the constituency controls more narrowly than in Part 2 of the Bill generally”.

The Electoral Commission feels there is a need to deal with this question and has identified it as one of the problems with campaigning organisations. Even if the amendment in our names does not meet the particular point and is not the right way to go about it, there is clearly a need to do something. Will the Minister undertake, in these last few days before Third Reading, to go back to the Electoral Commission and discuss this issue with it again? On that basis, I am prepared to withdraw the amendment.

Amendment 52 withdrawn.