Guide to the Rules Relating to the Conduct of Members

Motion made, and Question proposed,

(1) That, subject to paragraphs (2) and (3) below, this House approves the Fourth Report of the Committee on Standards and Privileges (House of Commons Paper No. 208) and the revised Guide to the Rules Relating to the Conduct of Members annexed thereunto;

(2) That the revised Guide be amended, in page 27, by leaving out the words “After receiving a donation or loan over £200 in value a Member has 30 days to check and confirm it is from a permissible source before either accepting it or returning it.” and by inserting in their place the words “After receiving a donation over £200 in value a Member has 30 days to check and confirm it is from a permissible source before either accepting it or returning it. Before entering into a loan a Member must check and confirm the lender is permissible.”;

(3) That the threshold for registering interests under category 4 (Sponsorships) shall be the statutory threshold for the time being applying to the reporting of donations by hon. Members to the Electoral Commission;

(4) That the revised Guide shall take effect on such date as section 59 of the Electoral Administration Act 2006 shall come into force;

(5) That the Register of Members’ Interests shall be renamed the Register of Members’ Financial Interests and the Registrar of Members’ Interests shall be known as the Registrar of Members’ Financial Interests;

(6) Accordingly, in each place where they occur in any Standing Order, Order or Resolution of the House:(a) for ‘Register of Members’ Interests’ there shall be substituted ‘Register of Members’ Financial Interests’; and(b) for ‘Registrar of Members’ Interests’ there shall be substituted ‘Registrar of Members’ Financial Interests’.—(Chris Bryant.)

15:33:00

Sir George Young (North-West Hampshire) (Con)
I invite the House to approve the revised guide to the rules relating to the conduct of Members as set out in the fourth report of the Committee on Standards and Privileges, which we published last week. It paves the way for an early end to dual reporting, as well as making a number of other changes which I believe will be welcomed in all parts of the House.

Coming as it does shortly after the adoption of the new Green Book and the setting up of the new Committee on Members’ Allowances, today’s debate gives us a opportunity to adopt a reporting regime that is intended to provide the House and our constituents outside with transparency and reassurance on our interests.

The code of conduct and the guide to the rules are essential components of the House’s regulatory machinery. It is vital that hon. Members have a clear understanding of what the code states and what the rules mean, in order that they may comply with them. The reporting regime, which is one of the most demanding in the world, needs to be overhauled from time to time to ensure that it is both effective and proportionate. The Committee on Standards in Public Life recommended that such an overhaul should be carried out once in each Parliament, and today’s package of proposals represents the overhaul in the present Parliament.

In addition to making changes that relate to the end of dual reporting, the revised guide clarifies existing rules, implements earlier decisions of the House—for example, on the employment of family members—and responds to developments outside this place, such as the development of new forms of investment vehicles. The final section of the revised guide sets out in greater detail than before the procedure for considering and investigating complaints that a Member has breached the rules. Many of the changes, however, and most of the red print in the revised guide are there to end dual reporting.

The requirement to report donations to both the Registrar of Members’ Interests and the Electoral Commission was, as my Committee’s report points out, an unintended consequence of the legislation passed in 2000. Problems came to light in 2005—[Interruption.] The House may have heard the aside from the Lord Chancellor, admitting culpability for such dual reporting. The problems came to light in 2005 when my Committee considered a report from the Commissioner for Standards on the inadvertent failure of my hon. Friend the Member for Orpington (Mr. Horam) to register donations in the Register of Members’ Interests, although he had fully reported those same donations to the Electoral Commission and they were in the public domain. The Committee concluded:

“It would in our view be better...if a single system, operating under the authority of the Commissioner, could be devised to replace the present arrangements, which would enable Members to discharge their obligations in relation to making donations public through a single declaration.”

An attempt was made to achieve that during the passage of the Electoral Administration Act 2006, but the complexity of the subject was underestimated at the time. Much of the past two years has been taken up with lengthy and detailed discussions that have drilled deep into the substrata of electoral law. With the successful conclusion of those discussions—I am grateful to the registrar, Alda Barry, and the Clerk of my Committee, Steve Priestley, for their work on this—we have now reached the point where the end of dual reporting is in sight and the “one-stop shop” called for by the Committee in 2005 will soon be able to open for business.

The main focus of the discussions over the last year or so has been the Electoral Commission’s very proper concern to ensure that we do not create a fresh anomaly in relation to Members who stand against non-Members in elections outside this place—for example, as Mayor of London or as a Member of a devolved Assembly. The end of dual reporting will mean that such Members are no longer subject to the same set of criminal sanctions as are other candidates. There are various legislative means of keeping the playing field level, but they are so complex and so convoluted that they resemble a steamroller being used to flatten a molehill. The Electoral Commission has agreed that such a legislative solution would be disproportionate, given the very few cases involved.

This agreement is important, because dual reporting cannot end until the Electoral Commission has indicated that it is satisfied it can get all the information it needs from the Register of Members’ Interests. I have been assured by Jenny Watson, who now chairs the Electoral Commission, that this revised guide will provide the assurances the commission seeks in order to sign off on dual reporting. It will then be for the Justice Secretary to lay a commencement order before Parliament. In its report, my Committee expresses the hope that this process will be completed by the end of June, and I rather hope that it may be completed well before then.

Members may well ask, “Well, what is the catch?” I do not believe there is a catch, but there is certainly some give as well as some take. Members will need to provide more information to the registrar than they did previously. However, this will be offset by the removal of any need to report the same information to the commission, and a single form will be provided for this purpose.

We considered whether to recommend alignment of the thresholds used by the House with those set down in statute. In several categories of the rules, the House requires interests with a value greater than 1 per cent. of parliamentary salary to be reported—at present, that sum is £633—whereas the statutory threshold tends to be set at a more generous level, which is currently £1,000. The 1 per cent. threshold was agreed by the House when the rules were last revised in 2002 and, in my view, it was set at an appropriate level. It provides a high degree of transparency in our reporting and, because it is indexed, it automatically rises in line with our pay. The Committee’s view is that this remains the right way to set the majority of the thresholds and we have not, therefore, recommended any change.

In relation to category 4, however—which covers most political donations and is the main area of overlap between the House’s requirements and those set down in statute—the threshold has been fixed at £1,000. Members will have seen that the motion provides for the threshold in category 4 to be tied to the level specified in the legislation, which, at the moment, happens to be £1,000. The Committee had not considered proposing this change, but it is a sensible adjustment that will avoid creating a differential between the House’s thresholds and the statutory ones, and I therefore support it. Any proposal to increase that threshold would come from the Government, but would be subject to parliamentary procedure.

Although hon. Members will no longer have to provide information on permissible donations and loans directly to the Electoral Commission, the commission will remain under a statutory obligation to publish all the relevant information as soon as is reasonably practicable. That means that the commission will publish information on its register within one month of receipt. In order to avoid a four-month gap opening up in the commission’s register, it will be necessary to return to the previous practice of requiring Members to register their interests within one month of their election or re-election to the House, rather than within three months, as at present. Separate deadlines for information required under statute and for information required under resolutions of the House would create confusion and lead to error, and the Committee therefore considers it preferable to have a single deadline.

In order for the Electoral Commission to obtain the information it needs to keep its register up to date, its officials will be granted controlled access to the office of the Parliamentary Commissioner for the sole purpose of gathering the information to which they are entitled. After a general election, the commission will need to publish some of this information in its register before the first edition of the House’s register is published. A memorandum of understanding is being drawn up with the Electoral Commission, and it will specify the limited circumstances in which access may be granted.

Members will also need to continue to report impermissible donations, or donations from unidentified sources, directly to the commission, which will remain the sole authority on such matters. All the substantive changes are described in the Committee’s report and are picked out in red. I shall not describe each of them, but I shall highlight just two aspects of the revised rules that are not related to the end of dual reporting.

First, hon. Members need to keep full records of each benefit of a value greater than £200. That is because a series of donations from the same source, each unregistrable in itself and even if spread across different registration categories, can give rise to a requirement to register if they accumulate to a value of £1,000 or more. Secondly, the motion makes specific provision to rename the Register of Members’ Interests so that it is called the Register of Members’ Financial Interests, and to make a corresponding change to the title of the registrar. The change has been proposed because there is some confusion outside the House as to the purpose of the register. By renaming it the Register of Members’ Financial Interests, we will make it clear that all the entries in the register have a real or potential monetary value. It is a small change, but one that the Committee believes is worth making.

When dual reporting ends, the Commissioner will write to every hon. Member, sending a copy of the new guide and details of the seminars arranged to explain the new rules to hon. Members. There will also be guidance about how to complete the new form. I strongly encourage any Member who may be in any doubt about how the new rules will apply to seek advice from the standards commissioner or the Registrar of Members’ Interests, who will be glad to help—or from the Electoral Commission, in respect of impermissible donations.

I believe that the end of dual reporting will be welcomed on both sides of the House. Together with the other changes recently agreed by the House, the revised rules constitute an important step forward in this House’s regulatory system and in the transparency and accountability that rightly apply to our financial interests as Members of Parliament. The Standards and Privileges Committee will keep all these changes actively under review, and I ask the House to support the motion that stands in the name of the Leader of the House.

15:43:00

The Deputy Leader of the House of Commons (Chris Bryant)
I rise to support the motion. First, and most importantly, I must say that I am grateful to the right hon. Member for North-West Hampshire (Sir George Young), who is the Chair of the Standards and Privileges Committee, and to his Committee for the work that they have done on this matter. He pointed out that although many Members of this House have wanted to make the change from a dual reporting system to a single reporting system, this has proved to be a rather knotty problem. I believe, as he touched on this, that he would also want to thank the Minister of State, Ministry of Justice, my right hon. Friend the Member for North Swindon (Mr. Wills) and his officials, who have worked very hard. My right hon. Friend has a first-class degree in history from Cambridge, and that is clearly what one needs to be able to deliver reform in this area. [Interruption.] The Lord Chancellor just pointed out to me that there are no thanks due to him for this.

We should also pay tribute to the work of the Electoral Commission—in the last few months in particular, it has worked very swiftly and co-ordinated well with the officials of the House—and of the Registrar of Members’ Interests and the Clerk of the Committee. They have all worked to bring forward this paper in timely fashion so that it can be considered in line with the Bill this afternoon.

Bob Spink (Castle Point) (Ind)
We all welcome the progress that has been made so far, but does the Deputy Leader of the House accept that we need more progress on the conduct of Members? For example, we should consider removing the 646 small businesses in the House and have Members’ staff employed by the Department of Resources centrally, so that we can remove that problem for the benefit of Members and our constituents.

Chris Bryant
I know that hon. Members feel aggrieved when newspapers report that we have claimed allowances of £180,000 a year, so it looks as though the staffing budget has gone into our own pockets, whereas—as all hon. Members know—we are merely claiming the money to ensure that our constituents receive swift replies to letters and so on, as they would naturally expect. Various Committees have considered whether the appointing of staff should be done centrally by the House, and it seems to me that the House is of the settled opinion that that would be inappropriate, for the simple reason that each constituency is different and each Member of Parliament works differently.

There has been a problem with dual reporting since the 2000 Act. Although it was an unintended consequence, it has produced some considerable inconvenience for vast numbers of Members. The problem stems not only from having to report to two different organisations with two different systems, but from the variation in the rules. That has led to inconsistency and confusion. One example, from my personal experience, concerns the free car parking space provided to me by NCP at Cardiff railway station. Any Member from south Wales who wants such a space can have one. That means that I do not have to declare it in the Register of Members’ Interests—I have asked on several occasions to ensure that that is the case. However, I do have to declare it to the Electoral Commission. There will be many such instances in which hon. Members are confused about whether they have to report various donations and benefits.

I am grateful that today we will be able to end all that confusion. However, as the right hon. Member for North-West Hampshire pointed out, the change will involve a cost to hon. Members. For a start, they will have to provide considerably more information to the House authorities under categories 4, 5 and 6 on sponsorship for their constituency associations or parties, and the benefits they receive in relation to overseas visits and gifts received on such visits. That information is laid out in the report, and it has been gone through with a fine-toothed comb by the Electoral Commission.

In addition, we have had to extend the rules of the House so that they meet the commission’s requirements. The requirement in section 43 now provides that if a

“personal benefit to the Member is not specifically received in the capacity of a Member of Parliament but is none the less related to his or her political activity”

it will have to be registered. That is a more stringent requirement.

In addition, there is a new category in the register in relation to loans and credit arrangements, which have been subject to registration and publication with the Electoral Commission. As the right hon. Gentleman said, there will also be a requirement for Members to register within a month after a general election, instead of the three months that they had previously. Indeed, I am told that Members were often dilatory about meeting the three-month limit. It will be vital, however, that the information is provided within the time limit after the next election. In order for the Electoral Commission to do its work after a general election, it will need to have particular access during that period to the House authorities’ information.

I should also alert hon. Members to one issue that has been raised several times with me, which is whether one must register membership of the armed forces parliamentary scheme, the police service parliamentary scheme and the National Council for Voluntary Organisations’ MP secondment scheme, as well as of the Industry and Parliament Trust. Such involvement has been exempt under the House’s rules but not exempt from registration with the Electoral Commission. The Electoral Commission has insisted that we will have to register such involvement and so Members should be aware of that.

Andrew Mackinlay (Thurrock) (Lab)
I do not know whether my hon. Friend was coming to the subject of category 3 on page 17, but I want to ask him a question as something is not clear to me. The definition of category 3 includes the words:

“In respect of any paid employment registered in Category 1…and Category 2”—

that is, directorships and remuneration—

“any provision to clients of services which depend essentially upon, or arise out of, the Member’s position as a Member of Parliament”.

I am confused by that, because, although there might be some relationship elsewhere, the wording here states that it should

“depend essentially upon, or arise out of, the Member’s position as a Member of Parliament”.

Surely we cannot get additional remuneration for anything that relates to our work as a Member of Parliament. I invite Members to take a look at category 3—it is clearly wrong that anybody should have such a facility. Will my hon. Friend clarify what is meant by that?

Chris Bryant
There are two elements that I can clarify. First, the House has always made it clear that nobody should be a paid advocate in their work as a Member of Parliament. I understand that my hon. Friend is suggesting that the definition strays close to that. All Members of the House would want to ensure that nobody was paid for performing their function as a Member of Parliament. I should also point out that paragraph 27 continues:

“In addition the Member should register any clients of the consultancy which he or she knows have benefited from such advice.”

I could not see on the register any such registration of the clients of the consultancy, merely that of the consultancy.

In addition, I want to refer to one other point of which hon. Members might not have been aware. In paragraph 34, the code now makes it absolutely clear that

“if a fundraising event raises more than £1000, a Member benefiting should register the event”.

I think that that is possibly a new category of registration to which Members will have to commit themselves and I note that there have not been many such events registered in the Register of Members’ Interests thus far.

I want to refer briefly to the thresholds. In categories 5, 6 and 7, as the right hon. Member for North-West Hampshire said, it is right that the registration threshold should remain at 1 per cent. of our salary. However, in relation to sponsorship under category 4 where the benefit does not come directly into our pockets but to our constituency associations, our constituency Labour parties or whatever organisation there might be, the law specifies that the threshold should be £1,000. It seems sensible, just in case the law were ever to change, that we should be aligned directly with the law rather than with the specific figure of £1,000. That is why the motion refers to that. We might also want to consider whether the £200 threshold at which one has to check whether a donation is from a permissible source, has to return it if it is not and has to register it with the Electoral Commission should be aligned with the legal situation rather than with the specific figure of £200. We might want to return to that at another date.

Sir Patrick Cormack (South Staffordshire) (Con)
Does that mean that if the hon. Gentleman’s constituency Labour party had a coffee morning or whatever and raised £1,000 he would then have to register it here?

Chris Bryant
Would that a Rhondda Labour party coffee morning raised more than £1,000. I am simply reading out paragraph 34, which makes it clear that if the amount is more than £1,000, Members have to register it in the Register of Members’ Financial Interests.

I now come to the next steps. First, the Electoral Commission is happy to confirm, as it did to the Chairman of the Standards and Privileges Committee, that the requirements that we are placing on hon. Members today meet all the requirements under the 2000 Act, and it will write to the Justice Secretary—the Lord Chancellor—to say so. He then expects to lay a commencement order before Parliament for section 59 of the Electoral Administration Act 2006 and paragraph 16 of schedule 7A to the Political Parties, Elections and Referendums Act 2000, so that dual reporting will finish by the end of June.

Sir George Young
To revert to the hon. Gentleman’s coffee morning in the Rhondda, the event would not have to be declared by the Member. Paragraph 29 says:

“Financial contributions to constituency associations…which are not linked to a Member’s candidacy…that is where the donation would have been forthcoming irrespective of the identity of the candidate…do not have to be registered on the Register of Members’ Interests.”

Chris Bryant
I am grateful to the right hon. Gentleman. However, at the bottom of page 19, a note to paragraph 31 says:

“Members might, in this context, ask themselves such questions as ‘Did I write to or meet the donor asking for a contribution?’, ‘Was a letter sent out headed ‘Campaign to [Re-] Elect [name]’’, ‘Was I the guest of honour at a dinner”—

or, I suppose, a coffee morning—

“where donations were sought?’ and ‘Have I a particular relationship to the donor”,

so the expectation would probably be that one would register such matters.

John Bercow (Buckingham) (Con)
If the Deputy Leader of the House would be so good as to press the rewind button, he will recall that a few minutes ago he referred, without evaluation, to the Electoral Commission’s requirement for disclosure of the fact of participation in the armed forces parliamentary scheme and similar such schemes. That is in contrast to the non-requirement on the part of the House. Does he find that position satisfactory? I did not get a clear sense that he had a particular view. I am not quite sure why the Electoral Commission is holding out for something on which the House is not insisting.

Chris Bryant
My feeling about the armed forces parliamentary scheme is that it is pretty difficult to evaluate, on a commercial basis, the cost of lying in a tent in Basra being shelled. It is pretty difficult to estimate whether that is worth £1,000 or more. However, when Members are not sure what the value of such a thing is, but guess that it might be more than £1,000, there is provision for them simply to attest to the fact that they have had that benefit. The honest truth is that it does no one a disservice to over-register; for instance, registering the fact that they have had the benefit of being involved in the armed forces parliamentary scheme would redound to their benefit, rather than to their discredit.

Dr. Gavin Strang (Edinburgh, East) (Lab)
This is coming as a revelation to us. Let us take the example of a dinner that my constituency Labour party held in August. I was at the top table and said a few words, and there was then an address by Tony Benn. The dinner made just over £1,000—perhaps £1,200—for the party. Obviously, that money would be available for it to spend on any party function, including electioneering. Is the Deputy Leader of the House saying—I am quite happy with this—that in future, either my local party, which is clearly an accounting unit, or I should register that £1,200, or whatever the sum, and say where it came from?

Chris Bryant
The regulations before us today do not affect the law. They do not change what one’s local party has to declare. All that they change is what an hon. Member has to declare. An hon. Member is required to declare any donation above £1,000 that is associated with them in some way, whether that is because it is for their re-election, because they sought the donation, or because they were a speaker at the event. Those are the tests that the Standards and Privileges Committee has set for us that decide whether we should declare such events. If an event makes more than £1,000 profit, and it is tied to the candidacy of an individual, or the individual invited people or was the guest of honour, they would have to register it—that is, if the threshold remains at £1,000.

Dr. Strang
So if the coffee morning or the dinner makes more than £1,000, that has to be registered by the Member of Parliament. Is that correct?

Chris Bryant
Yes. [Interruption.] I am sorry, but that is clearly stated in the report.

Mr. John Horam (Orpington) (Con)
If the donation is not in any way linked to the Member of Parliament, or is not supported or asked for by them, does it have to be registered?

Chris Bryant
Absolutely not. Let me see whether I can make the position clearer. Where there is a direct relationship between the hon. Member and the donation or the event, the Member has to register with the House authorities, but a direct relationship includes being the person who sent out the invitations, who speaks at the event or who is the guest of honour—these are all in the report. Hon. Gentlemen who are making odd faces at me from the Opposition Benches need to read the report.

Andrew Mackinlay
I interrupt only because the body language signifying confusion among hon. Members is considerable. The right hon. Member for North-West Hampshire (Sir George Young) clearly disagrees with what the Deputy Leader of the House is saying. Hon. Members deserve some clarity and precision on the matter. [Interruption] The Deputy Leader of the House says, “I am correct”. Clearly, that is not the view of the architect and author of the report, so can somebody help us? Hands up.

Chris Bryant
If my hon. Friend, of whom I am a great admirer, reads the report, as I am sure he, as a very assiduous Member, has done, he will know that paragraph 34 states:

“Similarly, if a fund-raising event raises more than £1,000, a Member benefiting should register the event”.

At the bottom of the page, the report states:

“Members might, in this context, ask themselves such questions as, ‘Did I write to or meet the donor asking for a contribution?’, ‘Was a letter sent out headed ‘Campaign to [Re-] Elect’ [name], ‘Was I the guest of honour at a dinner where donations were sought?’”

That is a pretty generous catch-all.

John Bercow
I was slightly concerned when the hon. Gentleman finished his remarks by saying that that passage was a “pretty generous catch-all”. It is precisely because it is a rather generous catch-all that there might be cause for concern. He refers to a guest of honour speaking at a dinner at which donations might be solicited. He will understand that a humble Back Bencher like me, or a Back Bencher who ought to be humble, is not regularly invited to speak at fundraising events that raise such sums, so I am not speaking self-interestedly, but is it not rather disturbing that there should be such a draconian requirement of which Members could quite innocently fall foul?

Chris Bryant
Perhaps the hon. Gentleman mistook me. The Member who has to register is a Member who is benefiting. For instance, if there is a fundraising dinner in one’s constituency to raise money for one’s constituency association, and it is headed, “The hon. Member for such-and-such a constituency invites you to a dinner and will be the guest speaker,” and there is a general election coming up, there is clearly a direct benefit, and the benefit of £1,000 is significant.

Sir Patrick Cormack
This is an important point. It involves all of us. The hon. Gentleman just referred to the possibility of a general election approaching. When an election has happened, there may be five years until the next one. All our constituency parties, whatever their political complexion, have events to raise money. People often pay extremely modest prices for tickets, such as £5 or £10. The cumulative effect of such an evening, perhaps because of a raffle, may well be that the £1,000 barrier is crossed. Is he really saying that in the year after an election, if his party or mine raises £1,000 at a fish and chip supper, a coffee morning or whatever it might be, the Member has to register?

Chris Bryant
Yes.

Bob Spink
I am grateful to the hon. Gentleman for giving way. I make him absolutely right; the acid test must be whether a Member will benefit. We are talking about whether £1,000 is raised for their political organisation. The whole objective of that organisation is eventually—whether in five years’ time or next month—to return them as a Member of Parliament, so that money will be used to benefit the Member and further their return to this House. If more than £1,000 is involved, it should always be declared.

Chris Bryant
Whenever there is a benefit to the hon. Member, it is important that they should declare. We are talking about a Register of Members’ Financial Interests. If an hon. Member was clear in their mind and heart that the event in question absolutely did not benefit them, clearly they would not have to register. However, simply reading paragraphs 29 and 34 together would make them understand that they were required to register the event if there was a doubt in their mind about whether they did benefit, and if the benefit involved was more than £1,000.

Sir George Young
rose—

Chris Bryant
Let us hear from North-West Hampshire.

Sir George Young
I draw the attention of the Deputy Leader of the House to the first sentence in paragraph 31, which may answer some of the questions:

“It is not possible to give an exhaustive list of what might be considered ‘linked’ to an individual, and, as always, Members who are in any doubt should consult the Registrar.”

Chris Bryant
Indeed, and I consulted the registrar earlier. She informed me that her advice would always be to register. I think that that solves the issue.

Mr. Horam
Let us be absolutely clear: any amount of less than £1,000 need not be registered.

Chris Bryant
It is the event that has to be registered. There is no requirement for sums below £1,001—the threshold kicks in above £1,000—and it is the profit of the event, the benefit, that has to be more than £1,000.

Mr. Peter Hain (Neath) (Lab)
As my hon. Friend knows, I have unwillingly become a bit of an expert on this stuff. I agree with many of the points made by Opposition Members. What I have just heard seems to be nonsense on stilts. I regularly have annual dinners in Neath. If 200 people come to one, paying £15 a ticket, and some pensioners take part in a raffle, and the profit—from a couple of hundred different people—goes over £1,000, as it often does, that is surely different from my writing to somebody asking them for sponsorship. If sponsorship money from a single individual came to more than £1,000, I would be in a sense obligated to that person and that should be registered, but the way in which this matter has been described seems to me a complete mess.

Chris Bryant
If there were a fundraising dinner whose tickets cost not £15, as in my right hon. Friend’s case—in my constituency they normally cost £20—but £500, the order of magnitude would be rather different. The issue is whether there is a significant financial benefit to the individual; the key point is whether that benefit is more than £1,000. If hon. Members are in doubt, they should consult the Registrar of Members’ Financial Interests so that they can have absolute clarity. However, I reassert that the rules say that the interest should be registered when there is a benefit of more than £1,000.

Dr. Strang
I was happy to register a visit to an Arsenal game that cost me very little, because the registrar would always say that we should register everything. However, the Minister is saying that if any dinner with any speaker makes a profit of more than £1,000, it should be registered. We should be telling the registrar what to do, not the other way around.

Chris Bryant
I can only keep on reasserting what I have asserted several times. If hon. Members do not like it, they should urge the Standards and Privileges Committee to change what it has laid down. The report makes it very clear what should happen when there is a benefit to an hon. Member by virtue of sponsorship of their constituency party or constituency association, by stating that

“if a fund-raising event raises more than £1000, a Member benefiting should register the event”.

In the process of deciding whether they have benefited, an hon. Member would want to bear in mind the following: is this an event that is directly related to my re-election or where I have solicited people into making contributions or paying for tickets to come, and is it focused around my membership as a Member of Parliament?

I shall end my remarks as I intended to do. I hope that the process of going to a single system of reporting instead of dual reporting will be unanimously supported by the House; that this will provide us with a much clearer, more consistent, efficient and transparent system; and that, to use a valleys word, it will be tidy.

16:10:00

Alan Duncan (Rutland and Melton) (Con)
I had hoped that this was going to be a very straightforward and simple debate and that all I would need to do was stand up, speak for two minutes, thank everybody and hope that everything was lovely and tidy, hunky-dory and tickety-boo, and that there would be no problems. However, although the House will have appreciated the Minister’s speech, it appears that he has unintentionally somewhat muddied the waters, and I sense that there is now some concern in the House about the precision with which the new system will work. Although what is proposed is billed as the abolition of dual reporting, a sentence on page 19 of the guide to the rules suggests that it is not entirely that:

“Registration by the Member is additional to any registration required of the local organisation.”

It is on that sentence and the link between association fundraising and the declarations of Members, whose benefit is the crucial aspect, that the confusion has arisen. If I may, I shall come to that point in a moment.

First, let us establish what we are trying to do. As we debated as recently as two weeks ago, openness and transparency are very important. Curiously, however, we have discovered over the past few years that that can be overdone, in the sense that duplication is unnecessary and adds nothing to the simple keeping of a central record, which should suffice. What has grown up is a process whereby, in addition to a thorough central record, a parallel institution has demanded that the same matters be recorded with it. That dual reporting has been an unintended consequence of the Political Parties, Elections and Referendums Act 2000, and it is, to any sensible person, absurd. Once is enough; if it has to be done twice and moreover the requirements are not exactly parallel, there will be a minefield on which people falling foul of the rules can be tripped up and maligned in the press for not complying with those rules.

Basically, we have had too many rules, and they have become so complicated that being a Member of Parliament is now a bit like running a small business. I would like to thank, properly, my right hon. Friend the Member for North-West Hampshire (Sir George Young) for trying to clarify those rules and presenting this report to the House. However, as he said, the process of making them less complicated has itself proved rather complicated. It is a bit like when Nigel Lawson, now Lord Lawson, said that the process of simplifying taxation inevitably makes taxation more complicated.

We have hit on a point that seems to be muddy. The underlying principle is that if any of us, as an individual Member of this House, appears to be benefiting from the raising or giving of money, we should declare it openly. However, two issues have given rise to concern in the 45 minutes of debate that we have had: the phrase “linked to” and the operation of our local constituency associations. I do things, as I am sure do the Minister and others in this House, to raise money for the Conservative party—in the Minister’s case, of course, it is not for the Conservative party—and I would like to think that if I am speaking at a fundraising dinner I can raise more than a thousand quid for the party. [Hon. Members: “No problem!”] Indeed; we could add a nought—we never know if people are queuing at the door.

However, that is not for my benefit. I think that the Minister said, rightly, that I would not receive the benefit, but it is fair to say that in some of his answers he gave a slightly different impression. Likewise, if I attend a meeting of my association—a dinner at which I, as the local Member of Parliament, might be speaking—and it raises more than £1,000, we are in a grey area where it may or may not be declarable. At the moment, in attending such an event, I would be raising money for the European and county council elections. That is of no benefit to me whatsoever, beyond the broader political advance that those elections will lead to. That is, however, in no way a direct contribution to me or my campaign.

Dr. Strang
I do not think that our local parties often organise dinners in our constituencies that raise more than £1,000 in profit, but if a profit of more than £1,000 is raised, given what has been said, it will obviously benefit the local Member. I know that the party is not just an electoral machine, but it is obviously a benefit to the local Member if the organisation makes a profit of more than £1,000. What has been said during the debate so far indicates that that amount should be recorded somewhere.

Alan Duncan
Once again, the right hon. Gentleman perfectly illustrates the new cloudiness in the rules, which we would like to avoid. If, for instance, my association were to raise £1,000 and I were not there, it ought to declare it and the rules clearly state that. If it were to raise £1,000 specifically for my election, and I were not there, it would be clear—if I knew that it had happened—that I should declare it, too. But the primary reporting obligation must rest with the constituency association.

The problem is the rather dangerous word “linked”. It is a word that the press use. When they say that a Member is linked to someone, and show a photograph, it might mean that they met that person five years ago. The question is: at what point does “linked to” become a direct benefit such that it is registrable? If “linked to” leads the registrar to say that it is better to declare, we will get “obligation creep”, if I can put it that way, where the rules are interpreted ever more widely, so that the declaration of almost anything becomes necessary.

Andrew Mackinlay
I share the bewilderment of the hon. Gentleman and my right hon. Friend the Member for Edinburgh, East (Dr. Strang). We seem to be going in a direction opposite to that set out in legislation passed by this House. We set up a complicated plethora of legislation in relation to political parties that placed a burden on them to disclose finances. In the Labour party, there are constituency agreements with trade unions where the burden of transparency is on the constituency, not the Member of Parliament. Why encumber a Member of Parliament who is diligently doing things and carrying out political activity? If there has to be a declaration, it surely should be the job of the constituency Labour party, Liberal association or whatever. I am not suggesting that that is the correct course, but there is a degree of logic to it because the constituency organisation is the recipient. It disburses the money between local, European and Westminster elections.

Alan Duncan
It may be that my right hon. Friend the Member for North-West Hampshire can explain a clear delineation that I and the hon. Member for Thurrock (Andrew Mackinlay) have not spotted, but the matter does seem a bit blurred. At the very least, I make a plea for some clarification of how the process will work in practice.

Sir Patrick Cormack
I am becoming more troubled as this debate proceeds. During the past few years we have been trying to identify areas where people can gain undue influence over Members of Parliament. If people  are giving large sums of money that could conceivably influence a Member of Parliament, it is quite right that that must be declared in the fullest possible way, that the donors should be identified, and that foreigners should be excluded—all of that. If we are talking about people paying a modest price for a ticket, however, going down this road will discourage ordinary people from giving the modest sums that enable democracy to flourish in this country. That is a retrograde step. I believe that it is terribly important that a multitude of people give relatively modest sums to fuel our democracy. I am totally against more state participation in the funding of political parties, but I am worried that we are going down a slippery slope that could deter ordinary, decent people from forking out a fiver, a tenner or £20 to go to function.

Alan Duncan
My hon. Friend has very strong views about where political participation and transparency potentially collide, and I understand his arguments.

I do not wish to dwell on the matter any longer, other than to say that the debate has, importantly, put the spotlight on some potential difficulties. If there is one thing that we want to avoid at all costs—the report goes a long way towards doing so—it is Members who behave honestly getting tripped up by a set of rules that they do not fully understand or about which they might not have known. The moral obligation on a Member to declare must surely rest on his having known what he needed to declare in the first place. If his local association does something, or something happens in connection with an event with which he was theoretically linked, and by failing to declare it a Member is made to appear guilty, that could lead to some injustice. The whole point of the changes is to tidy the system up and try to avoid that. However, I shall park that matter to one side.

I wish to say a couple of things about the Electoral Commission. It is fair to say that there was a phase when it rather enjoyed empire-building and involving itself in parliamentary matters even when there was a perfectly good parliamentary system in place to ensure the openness and standards that we wanted. I would like to think that we have passed that phase, but I simply cannot see why participation in the armed forces parliamentary scheme has to be declared. It is hardly a benefit in kind. It is informative and very hard work in many cases, and I certainly recommend that my hon. Friend the Member for South Staffordshire (Sir Patrick Cormack) go on the Marines training course. Getting through the tube in the Special Air Service exercise is quite something.

The Electoral Commission should examine some of its own practices. I had a minor spat with it last year, as one of its declaration forms is complete gibberish. It requires a Member or anyone else filling it in to declare the details of a donation for an overseas trip. By the very nature of a visit to a foreign country, the donor of the trip is not a permissible donor under electoral law. They cannot be the origin of money given to a political party, but it is perfectly legitimate for us to accept a visit to a foreign country paid for by the host Government. On section D of its form, the commission requires a signature under the words:

“I confirm, to the best of my knowledge and belief, that the donation was from a permissible donor”.

That is complete nonsense, but despite being told that, the Electoral Commission will not change that idiotic, perilous form. It, too, has some lessons to learn.

As I think the whole House will agree, the Minister is quite right that the two operations have to work in alignment and in parallel, so we understand that the thresholds will be agreed and will fall into place in both our system and the Electoral Commission’s system at a later date. We appreciate also that calling the register the Register of Members’ Financial Interests will better explain to the outside world that we are talking about money, and that money of pecuniary interest—I know that the Committee states that we should no longer use that term, so I shall call it financial interest—matters the most.

The report largely explains the rules for each category helpfully. All that I ask—I sense that this is the mood of the House—is that some clarity be given about how the interaction between Members, fundraising events and their local associations will work. Beyond that, I hope that the House will support the endorsement of the report.

16:23:00

Mr. David Heath (Somerton and Frome) (LD)
Like the hon. Member for Rutland and Melton (Alan Duncan), I rather assumed that this would be a brief and uncomplicated debate, but it has proved to be anything but. One difficulty is that whenever anyone refers to the obligations that are placed on political parties or Members in the Political Parties, Elections and Referendums Act 2000, it comes as a huge revelation to Members that they have been required to act in a particular way. It is hardly surprising, then, that hon. Members occasionally find themselves caught out by inadvertence rather than by anything else.

We have had a dual reporting system with different categories and criteria and, therefore, somebody who believed that they had done the right thing by registering interests properly with the Registrar of Members’ Interests found themselves at fault because they had not done so with the Electoral Commission under the 2000 Act. Many of us have argued for bringing the two systems together and rationalising them, for a long time. I congratulate the right hon. Member for North-West Hampshire (Sir George Young) and his Committee, on which I once served, on their work on putting the two codes together.

Let me say gently to the Deputy Leader of the House that he did not shed an awful lot of light on the matter that caused all the difficulties this afternoon, not because he was not trying desperately hard to do so, but because, every time he opened his mouth, someone had a new flash of inspiration about an event in their constituencies that perhaps they should have registered, but had not. They therefore reacted with alarm. However, hon. Members should know that the proposals do not change the law or the current position. If they have arranged a dinner, or an event such as the mythical coffee mornings in the Rhondda, which raise more than £1,000 in profit—I am impressed by that; perhaps it is the best way in which to raise funds in south Wales, but it does not work so well in Somerset in terms of gross profit—which are designed to raise money for their candidature that falls within the terms of the 2000 Act. Such an event will now have to be registered on the Register of Members’ Financial Interests here, but the registration no longer needs to be duplicated. Reporting by political parties is different.

Sir Patrick Cormack
The more I listen, the more confused I become. Most fundraising events are not held not to further the interests of the sitting Member, but to pay for the rent of the premises that the party occupies, the agent’s salary and other matters. When a general election is called, most of us have a fighting fund, which is—then and only then—entirely for the benefit of the prospective Member. There is a genuine difference between the two, but, this afternoon, we find the waters muddied.

Mr. Heath
They are not muddied. The hon. Gentleman has described what the political parties, not the Member, must register. The Member does not have to register anything that is not for his particular benefit. That is the distinction, which is not especially difficult. If in doubt, Members will have to consult the Registrar and ensure that they are doing things correctly. However, the provision should not come as a surprise to hon. Members because it is not new. Whom one tells is new, not the necessity to report. That is crucial.

I want to deal with the interesting and important point that the hon. Member for Thurrock (Andrew Mackinlay) made in an intervention on the Deputy Leader of the House about category 3 declaration. It covers

“any provision to clients of services which depend essentially upon, or arise out of, the Member’s position as a Member of Parliament”.

I assume, because of the rules of advocacy, which the report also includes, that that category covers simply providing advice to a company or organisation arising from our knowledge as Members of Parliament of the proceedings and procedures of Parliament, and not advocacy, which is not allowed under the rules. However, we need to consider that carefully at some stage. If we want to avoid the appearance of partiality, it is difficult to be a Member of Parliament, who is employed for the purposes of providing services associated with being a Member of Parliament, without the question of partiality arising.

I shall take it no further today, but that category is there in black and white as a recognisable category. We shall see who registers and what sort of interests are registered under that category, but we would do well to return to it in future, to see whether it is appropriate.

Having said that, I think that we have a good and sensible coalition of the two codes under which we are allowed to register, although I agree that there is still some nonsense in the arrangement. The hon. Member for Rutland and Melton (Alan Duncan) mentioned one example, which is the registration of visits under the armed forces parliamentary scheme. When I went to the Arctic with the Royal Marines, I did not feel that I got an enormous financial benefit from sitting in a tent in the Arctic circle, but I benefited enormously in my personal development and my knowledge of the privations that the armed forces face. I was pleased to have that opportunity. I am not convinced that it ought to be a registrable interest, but on the other hand, what harm does it do me to say that that is what I have done? I do not see that anyone would suggest that such a declaration would be a pejorative declaration.

Andrew Mackinlay
Some years ago I participated in the Industry and Parliament Trust scheme with BAE Systems. I am proud of that experience, which was very successful and I think that it was mutually beneficial. However, BAE Systems does advocacy and from time to time runs into controversy. I have reflected on the matter for some time, and I would have been more comfortable had it been the norm for work with the Industry and Parliament Trust to be declared, for the reasons that I have given, which do not apply to the armed forces parliamentary scheme. The Industry and Parliament Trust is a very good scheme, but a declaration needs to be made.

Mr. Heath
I am grateful for the hon. Gentleman’s comment. The other example is this car parking business. I remember putting forward a strong argument when the proposal was first mooted, when we all used to get tickets for parking at airports, which the Electoral Commission held to be a declarable interest under the Political Parties, Elections and Referendums Act 2000, despite the fact that they were available to all Members and to be used only for parliamentary work. Therefore, there was no personal advantage whatever; the advantage was to the House authorities in not having to pay for the parking, rather than to the Member concerned. The individual Member was neither better nor worse off from being able to park at an airport. I hope that all such matters will eventually be brought into line by the coalition of the two codes.

Finally, let me reassure the hon. Member for South Staffordshire (Sir Patrick Cormack) that if he holds a dinner that is registrable, in that it raises more than £1,000 for his personal campaign, there is no requirement for him to list all the people who were there or where they sat and what they ate. That is not part of the code. He simply has to register the fact that the event happened. That does not seem to be quite as intrusive as perhaps he feared. I welcome the report and I hope that the House will support it this afternoon.

16:33:00

Bob Spink (Castle Point) (Ind)
The Minister has done a good job this afternoon in trying to push the House in the right direction, but I am deeply saddened that this House is yet again sending out a negative message to the public, which is that we do not want to be transparent. The suggestion is that we want somehow to hide what we are doing and to hide the money coming into our associations which will, one way or another, eventually benefit us. That is a negative message. It reinforces what the press and the public think about this House, and it is a downright shame. The clear message going out to the public is that we do not want to register benefits and interests.

Constituency associations and political parties have one key objective—it is the No. 1 objective in their constitutions; indeed, they say it on the front page—and that is to win elections. The key election that political parties want to win is the election to get their members back into this House. Members will return to this House if their constituency associations are doing well, by winning local government elections, for instance, because that can be helpful to those Members.

I disagree entirely with the Conservative Front-Bench spokesman on this point. We should be totally transparent about this, because we have nothing to hide. The whole organisation of a political party—its constituency organisations, its associations—exists to return candidates; there are no grey areas, so I wonder why we feel that we have something to hide. We should be declaring the £1,000 that is raised for our constituency association, and we should be happy to do so, so that the public can benefit from that transparency and we can be held to account.

I welcome this paper, as far as it goes, but we should go much further. We really should look at how our staff are employed and at the conditions and selection processes involved. Of course, Members should have control over which staff are selected, but our staff should be employed formally and professionally by the Department of Resources, not by 646 separate small businesses in the House. That is not what we come to Parliament to do. We are legislators; we are here to fight for our constituents, our associations and our country. We are not here to act as small businesses employing people. We should get away from that practice, which would save us a lot of problems and give the public more confidence about what we do here and how we are doing it. God knows, the public need to get some confidence in us; at the moment, they certainly do not have any.

Finally, I should like to mention the outside earnings syndrome. In this day and age, it is nonsense for Members to be moonlighting and doing other jobs that earn them more money than their main job here pays them. I spend between 60 and 80 hours a week doing my job. I could do more, and I could do a better job, if I had more time to do it. There is no way that I have time to go out and earn money on the side by being a barrister, writing articles for newspapers or going on the circuit giving after-dinner speeches. Those practices are total nonsense in this day and age in a modern Parliament, and we should stop that abuse. Those Members are out there earning a good living doing something else while drawing their full salary here but failing to do the full job.

Andrew Mackinlay
Surely the answer is to adopt the practice of many modern Parliaments and to introduce transparency. Under such a system, a person could moonlight—to use the hon. Gentleman’s word—but that would have to be declared and an abatement would be made to the MP’s salary. The MP’s voters could also take his behaviour into account in their assessment of whether they wished to return him at the next general election.

Bob Spink
Very unusually, I do not agree with the hon. Gentleman. We are elected on a matter of trust between us and our constituents, and on a set of promises that we give them when we put ourselves up for election. We say that we are going to come here and work for them and do our best for them. By taking a reduced salary, we would be doing a lesser job here. If Members are not prepared to do their job here, it is incumbent on them to resign and let someone else come in and do the job that the public want and require us to do. We all have constituency problems, and we need to be there to help our individual constituents. We need to fight for our communities, and for our country, and MPs ought to stop having second jobs. It is an abuse of the system.

16:38:00

Chris Bryant
With the leave of the House, I should like briefly to reiterate our thanks to the Committee on Standards and Privileges for the work that it has done. On the one issue that has been of concern to Members during the debate, I am sure that the Committee, together with the Registrar of Members’ Financial Interests, will want to ensure that proper advice is made available to hon. Members. If that requires the Committee to produce an additional report or additional time to be made available for the House to look at these matters, I am sure that we would want to be able to arrange that. We thank the right hon. Member for North-West Hampshire (Sir George Young) and his Committee for their work.

Question put and agreed to.

Resolved,

(1) That, subject to paragraphs (2) and (3) below, this House approves the Fourth Report of the Committee on Standards and Privileges (House of Commons Paper No. 208) and the revised Guide to the Rules Relating to the Conduct of Members annexed thereunto;

(2) That the revised Guide be amended, in page 27, by leaving out the words “After receiving a donation or loan over £200 in value a Member has 30 days to check and confirm it is from a permissible source before either accepting it or returning it.” and by inserting in their place the words “After receiving a donation over £200 in value a Member has 30 days to check and confirm it is from a permissible source before either accepting it or returning it. Before entering into a loan a Member must check and confirm the lender is permissible.”;

(3) That the threshold for registering interests under category 4 (Sponsorships) shall be the statutory threshold for the time being applying to the reporting of donations by hon. Members to the Electoral Commission;

(4) That the revised Guide shall take effect on such date as section 59 of the Electoral Administration Act 2006 shall come into force;

(5) That the Register of Members’ Interests shall be renamed the Register of Members’ Financial Interests and the Registrar of Members’ Interests shall be known as the Registrar of Members’ Financial Interests;

(6) Accordingly, in each place where they occur in any Standing Order, Order or Resolution of the House:

(a) for ‘Register of Members’ Interests’ there shall be substituted ‘Register of Members’ Financial Interests’; and

(b) for ‘Registrar of Members’ Interests’ there shall be substituted ‘Registrar of Members’ Financial Interests’.