asked Her Majesty's Government:

My Lords, the fact that a death has occurred forms an essential element in three road traffic offences. For both causing death by dangerous driving and causing death by careless driving while under the influence of drink or drugs, the average sentence for males imprisoned in 1998 was 39 months. For aggravated vehicle-taking where a death results, the equivalent figure for 1998 was 23 months.

My Lords, I thank the noble Lord for that reply. Is he aware that there is widespread concern that inappropriate charges are being brought and therefore occasionally inappropriate penalties applied in cases of causing death by dangerous driving? The suggestion has been made that the CPS is using an unnecessarily high standard of proof. Can the Minister say what action, if any, the Government are taking in that regard? Secondly, has the review of the penalties which was supposed to be taking place been completed and, if so, when will the results be published?

My Lords, the Government are well aware of those concerns. The noble Baroness will know that my right honourable friend the Prime Minister has taken a deep and profound interest in such cases, sparked particularly, perhaps, by the circumstances surrounding the tragic death of PC Tooley.

I can advise the House that since Labour came to government we have been looking carefully at these matters. In 1999 the Transport Research Laboratory was invited to carry out research on behalf of the DETR into the way in which bad driving cases proceeded through the criminal justice system. That report is currently being finalised and we shall need to study it carefully—it is a complex area of law—with a view to publication. We shall then be in a better position to judge whether any changes in this area of law and its operation are necessary.

I should also advise your Lordships' House that we are in the process of finalising a consultation paper on the outcome of a more general review of penalties for road traffic offences.

My Lords, does the Minister agree that, in respect of offences of causing death by dangerous driving, it is extremely important to keep the fullest range of judicial discretion in sentencing? Such offences may involve heinous criminality and criminal intent, justifying the maximum sentence of 10 years imprisonment. But they may also involve little or no criminal intent, relying simply on an error of judgment committed in a moment of bad driving which may not justify any sentence of imprisonment at all.

My Lords, the noble Lord speaks with great wisdom on these matters. That must be so because that is exactly what it says in my brief.

My Lords, given that we are now on the 21st day of the eleventh month of the year 2000, can the Minister say why he was only able to give us statistics from 1998?

My Lords, it is the best that we can produce in the circumstances. I shall of course go away and reprimand those Home Office officials who have been rather laggardly in bringing forward the data.

My Lords, is my noble friend aware of the first ever case of corporate manslaughter, brought against a lorry driver and his company, for causing death by dangerous driving one year ago? I understand that both the company and the driver received suspended sentences. Without commenting on specific cases, does not my noble friend consider that to be a bit of a light sentence?

My Lords, I am damned if I do and I am damned if I don't. I am in one of those situations where my noble friend is inviting me to comment on a case and also telling me that I should not comment on the case, and that is the course I am going to follow.

My Lords, what is the situation regarding penalties received by police officers convicted of accidentally killing another person while in charge of a motor vehicle?

My Lords, police officers would be in exactly the same position as other members of the public. They should be treated equally, without fear or favour.

My Lords, when a driver has pleaded guilty to the lesser charge of careless driving, is my noble friend aware that the courts may not be aware that a fatality has occurred and that may well pre-empt a coroner's decision?

My Lords, I know that concerns have been expressed that courts are sometimes unaware of the position. As Ministers, we have received a number of letters on that point, particularly from Members of Parliament. The Crown Prosecution Service guidelines make it clear that that should not happen. If clear evidence exists that courts are unaware of those factors, it would be helpful for us to be informed because we clearly need to act in those circumstances.

My Lords, would my noble friend agree that, by way of plea bargaining or otherwise, it is wrong in principle that the Crown Prosecution Service should reduce charges simply for the purpose of improving its statistics in terms of convictions?

My Lords, I am sure that that sentiment is widely shared in your Lordships' House. Ultimately, it is for the courts to make a determination as regards the severity of a sentence and such matters are best left to the courts. However, there must be clear guidance in those circumstances.

asked Her Majesty's Government:

My Lords, there is a long-standing convention that the Comptroller and Auditor-General's reports to Parliament are agreed with the accounting officer as to the facts. That is to avoid the Public Accounts Committee having to arbitrate between the Comptroller and Auditor-General and the audited body over disputed facts when they take evidence on reports.

Accounting officers may have some reservations about the interpretation of the facts in the report. Where such differences have not proved capable of resolution in discussion, they are explained in the report with the reasons for the differences of opinion clearly stated.

The conclusions and recommendations of the report are, however, for the Comptroller and Auditor-General alone to determine.

My Lords, in the outside world the relationships between client, auditor and regulators are separate, clearly defined and well understood, with the Inland Revenue having a well-known interest in conclusions. In a situation in which the government fill all of those roles, is the Minister confident that they can satisfy the public about the integrity of the arrangements which are necessary to keep the various roles separate?

My Lords, the noble Lord, Lord Dixon-Smith, appears to ignore the fact that the Comptroller and Auditor-General reports not to the Government but to Parliament. It is the decision of Parliament—and it has been for many years—that the Comptroller and Auditor-General should clear up any issues of fact before the report is issued and considered by the Public Accounts Committee.

My Lords, does the noble Lord agree that, whether or not Ministers or officials contribute to National Audit Office reports, no rules prevent the prompt debate of such reports in this House? Does he further agree that there is a strong need for an early debate of the report on the Dome?

My Lords, there has been a convention for many years not only in this Government but in previous governments that reports from the Comptroller and Auditor-General to Parliament are considered by the Public Accounts Committee before there are further parliamentary procedures. It is our intention to continue with that very proper convention.

My Lords, what is to prevent the Comptroller and Auditor-General from clearing up matters of doubt, which one can understand may exist, with the Government before they publish the report?

My Lords, that is exactly what he does.

My Lords, will my noble friend consider reviewing the procedures that he has described, because one often finds that in practice the dividing line between fact and opinion is obscure? Will he consider my concept of the matter: that the public are entitled to complete confidence in the National Audit Office and that it is desirable in the public interest, never mind tradition, that nobody, but nobody, should interfere with the report which the Comptroller and Auditor-General seeks to make on his own initiative?

My Lords, I agree with my noble friend about the need for complete confidence in the independence of the National Audit Office and the Comptroller and Auditor-General. However, I answered his questions in detail in my first Answer: that the issues agreed with the accounting officer are issues of factual accuracy; and that, if there is a reservation about the interpretation of facts which cannot be resolved, the difference of opinion is explained in the report. I believe that that is the transparency which my noble friend seeks.

My Lords, does the Minister agree that we live in an age of full disclosure? Is not that reflected in the mission statement of the National Audit Office, a vital body which has as one of its seven core values a belief in open communications? Therefore, will the Government authorise the National Audit Office to disclose on what occasions and in what respect its reports have been altered by Ministers?

My Lords, the reports which come to Parliament from the National Audit Office are factually correct and steps are taken to ensure that they are. If there is an issue of disclosure to Parliament of differences, my first Answer answered the noble Lord's question. Where there are disagreements they are explained in the report, with the reasons for the differences of opinion clearly stated.

asked Her Majesty's Government:

My Lords, my right honourable friend the Secretary of State announced the Government's spending plans for higher education in England on 16th November. The total additional funding for the sector is £412 million in 2001–02, £268 million in 2002–03 and £298 million in 2003–04. That represents a 10 per cent real terms increase.

Since 1998, the total additional funding for institutions is £1.7 billion, an 18 per cent increase in real terms over the six years. Copies of the press notice have been placed in the Library of the House.

My Lords, I am grateful to the Minister for that Answer. It is good that four months after the publication of the Comprehensive Spending Review universities finally have an assurance about what their spending plans can be and can begin planning.

Does the Minister agree that the problem which faces people like your Lordships is the interpretation of the figures? Can the noble Baroness assure the House that the figures quoted in the press release as publicly planned spending increases include moneys which come to the universities from student fees? Am I also right to conclude that the money supposedly available for recruitment and retention of staff, equal opportunities and human resource potential has been double counted in that, if universities are successful in achieving the targets for access set by the Government, they will not have that money available to spend on increased staff salaries?

My Lords, I believe that all I need say in response to the noble Baroness is that there is no double counting in these figures.

My Lords, is the Minister willing to expand on the very serious issue of recruitment and retention of staff? As the Minister is well aware, there are areas of university life where it is almost impossible to recruit able people of the right calibre to posts at the salaries offered. Can the Minister assure the House that this money includes resources for universities to use for that important purpose?

My Lords, I can confirm that for 2001–02 there is a figure of £50 million for that purpose, and for the following two years the figures are £110 million and £170 million respectively. I accept that there are difficulties in recruiting and retaining people of very high calibre in certain fields. However, one should not exaggerate the overall position. There are still many good people coming forward who want to work in our universities as academics and in other roles.

My Lords, the Minister gave three figures in her first response to the noble Baroness's Question. Can she explain precisely why the figure for the first year is so much higher than those for the following two?

My Lords, in the first year there is a substantial amount of funding to improve opportunities for young people who come from low income backgrounds. There is substantial extra widening access funding available in the first year. The total additional funding of higher education is way above the amounts that I quoted, which do not include the research figures. The total additional funding will be £3 billion by 2004, taking overall funding to £7.7 billion.

My Lords, does my noble friend agree that if there is a scarcity in certain fields the universities, which are independent institutions, can adjust the amount that they wish to pay in the overall financing of that sector?

My Lords, my noble friend is absolutely right. Pay in universities is a matter for higher education institutions, not the Government. The additional funding that we have been able to make available is considerable when viewed against the background of a 36 per cent cut under the previous government over the period 1998 to 1997. However, this is a matter for universities, which now have additional funding to pay rather better salaries.

My Lords, can the Minister assure the House that this means that in future the Government will pay as much attention to the quality of higher education as to access to it, which seems to have been the strong message of the past two to three years? Does the noble Baroness accept that the example of Ireland in particular shows that investment in higher education of the best quality has direct pay-offs in terms of higher economic growth, which is very much what this country needs?

My Lords, I have just quoted very substantial figures for investment in higher education. The Government accept that that investment will pay off in the knowledge economy. The Government have been committed to improving quality over the past three years. Although they want to widen access and make it possible for young people with potential to go into higher education, they have also focused a great deal of attention on quality issues.

My Lords, I believe that the Minister will have to correct the two dates which she quoted in her previous response. The noble Baroness referred to cuts between 1998 and 1997. Can she say what proportion of the sums to which she refers has been pre-announced, what proportion represents inward investment, for example from the Wellcome Trust, and what proportion is as a result of student fees?

My Lords, I shall correct the slip of the tongue. I meant to refer to the period 1988 to 1997 during which the previous government substantially cut unit funding to higher education. The noble Baroness asks quite detailed questions. I reassure her that all this is new money, a very small amount of which was announced in July at the time of the Comprehensive Spending Review. I shall write to the noble Baroness to provide the details.

My Lords, is the Minister aware that only one in 300 children from care go into higher education as opposed to one in five for the rest of the population? Will some of the funding for widening access go towards promoting opportunities for these particular young people?

My Lords, under the Children (Leaving Care) Bill which the Government have introduced a great deal is to be done to support these youngsters. More specifically, my department is providing extra funding to support young people in care who are in higher education but who, for example, do not have a home to go to in long vacations. A great deal more must be done to give these youngsters the opportunity that they have not had in the past to develop their potential.

asked Her Majesty's Government:

My Lords, we announced our policy in our response to the Royal Commission on Long-Term Care of the Elderly. We believe that our proposals to invest in intermediate care and to improve standards of care and fair access to services, together with the changes that we are making to the funding of long-term care, will generate important benefits of health and independence for older people.

My Lords, my noble friend is invariably helpful, but how can he speak about fair access to services when the Government's policy to pay only for nursing care in residential homes and refuse to pay for personal care discriminates against some disabled people? It cannot be right that someone who suffers from, say, Alzheimer's disease is forced to pay for his or her personal care, whereas the different costs of people with other disabilities are fully paid for by the state. The policy to refuse to help with the personal care of people who must be fed, washed, dressed and toileted by others is unacceptable. The wise politicians of Scotland have said that they are to reconsider that matter. Why can we not do so?

My Lords, my understanding is that Scotland has committed itself to a review of existing policies without prejudging the outcome. I have enormous respect for my noble friend; however, the Government believe that their proposals represent a better targeting of resources. Three-quarters of those in residential nursing care already get some or all of their personal care costs from public funds. To make personal care free for everyone would carry high and increasing cost without in itself improving services, and it would consume many of the additional resources that we are making available to people through the NHS Plan, including the important provision of intermediate care.

My Lords, as 760 nursing and residential care homes closed last year with the loss of 15,000 beds, does the Minister agree with the chairman of the Nursing Home Association that if the trend continues there will not be any nursing care homes left in three years' time?

My Lords, I do not agree with that assessment. I understand that in some parts of the country a number of nursing homes have come under financial pressure. I also accept that there was a drop in the number of nursing home and residential home care beds between 1998 and 1999, but the picture is very mixed throughout the country. Between 1995 and 1999 there was a net increase in nursing home beds. Laing and Buisson, the consultants who observe the private health care sector, consider that there is still excess capacity in the residential care and nursing home sector in many parts of the country.

My Lords, will the Minister agree that there is enormous anxiety among elderly and disabled people and their families and carers because the Government have not clearly defined what is meant by "personal care"? We know that some care which is delegated, supervised or authorised by nurses will be paid for. But that just increases the anxiety. We must now have clarification.

My Lords, I am sorry if—particularly older—people are anxious about the intentions of the Government because I believe that the package of proposals that we have announced will lead to an enhanced package of care and support. The noble Baroness raised the important consideration of the definition of nursing care. The Royal Commission—indeed the dissenting note in the Royal Commission—accepted that it was perfectly possible to define nursing care. I can inform the noble Baroness that we are developing what is called an "assessment framework" in order to ensure that there is a proper definition which will be applied consistently throughout the country. We are consulting with a number of relevant organisations on just such an assessment and definition, including the RCN and the Alzheimer's Disease Society.

Order!

My Lords, as we have only reached 25 minutes, there is probably enough time for everyone to get in. Perhaps the noble Baroness next, and then my noble friend.

My Lords, will the Minister reassure the House that there will not be elderly and disabled people in need of care but unable to get it for reasons of funding or anything else?

My Lords, that is the intent of the policy in relation to long-term care that we announced in the NHS Plan. We want to ensure that people get the right support, not just in nursing residential care homes but also in the community and in rehabilitation programmes. We want to see the development of intermediate care in order to promote independence through active recovery and rehabilitation. We will spend an extra £900 million by 2003 to 2004. We are making strides. I believe we can do more in the future.

My Lords, the House is indebted to my noble friend Lord Ashley for raising this timely and very important question. Can my noble friend the Minister say what work has been done on quantifying and costing to the National Health Service the effects of the inequity of present arrangements? How many NHS beds are now being taken up by people who would be more appropriately cared for in other accommodation if the inequity was removed?

My Lords, it is not possible to answer all those specific questions. The latest statistics show that just under 6,000 people over the age of 75 had their discharge from hospital delayed in the second quarter. Some of that delay was because of issues in relation to social services funding and some was due to people waiting for an appropriate residential care or nursing home place. The sooner we can implement intermediate care to enable people who are unnecessarily awaiting discharge in hospital beds, the better we can provide services to those people through rehabilitation, wherever that is possible, or, if not, in an appropriate nursing home. The quicker we deal with delayed discharges the sooner beds in our hospitals will be available for members of the public requiring treatment.

I believe that the package of measures of intermediate care and the decision to pay for nursing care in nursing homes will be an important part of the drive to improve the situation.

My Lords, will the Minister confirm that if an older person at home receives a change of dressing for an ulcer from a district nurse, that is free, but that the same person in a residential home receiving the same treatment from someone who is not a nurse will have to pay? Does he agree therefore that when such anomalies exist the Government's claim in the NHS Plan that any contribution people will have to make towards the cost of their care will be fair, predictable and related to their ability to pay is in severe doubt?

My Lords, I do not follow the noble Baroness. My understanding is that, for instance, district nursing services will be available in a residential home provided by the National Health Service. In relation to a registered nursing home, the proposals we are making will ensure that nursing care provided by a registered nurse will be available and paid for by the National Health Service.

My Lords, I beg to move the Motion standing in my name on the Order Paper.

Moved, That the Commons message of 16th November be now considered; and that the promoters of the Bill have leave to suspend any further proceedings thereon in order to proceed with it, if they think fit, in the next Session of Parliament, provided that notice of their intention to do so is lodged in the Office of the Clerk of the Parliaments not later than 12 noon on Monday 27th November;

That the Bill be deposited in the Office of the Clerk of the Parliaments not later than noon on the second sitting day in the next Session with a declaration annexed, signed by the agent, stating that the Bill is the same in every respect as the Bill at the last stage of the proceedings thereon in this House in the present Session;

That the proceedings on the Bill in the next Session of Parliament be pro forma in regard to every stage through which the Bill has passed in the present Session, and that no new fees be charged to such stages;

That the Private Business Standing Orders apply to the Bill in the next Session only in regard to any stage through which the Bill has not passed in the present Session.—(The Chairman of Committees.)

On Question, Motion agreed to; and it was ordered that a message be sent to the Commons to acquaint them therewith.

My Lords, I beg to move that the Bill be now further considered on Report.

Moved, That the Bill be further considered on Report.—(Lord Bassam of Brighton.)

On Question, Motion agreed to.

moved Amendment No. 56A:

Page 19, line 20, at end insert ("whose annual certified income is more than £5,000").

My Lords, I have nothing to add to the remarks of my noble friend Lord Hodgson other than to support them. My noble friend has had a distinguished career on the voluntary wing of the Conservative Party and probably speaks for the volunteers in all the parties in the Chamber. Like my noble friend, I believe that those who struggle in seats where they know they will never have a chance of winning are perhaps the bravest of the foot soldiers in all our parties. At least the people who are struggling in seats which they believe they might win know that one day they may have a chance of victory. Perhaps on other days there will be a chance of defeat, but at least the occasional victory keeps them going. The people who struggle for our parties in the poorest seats deserve special consideration. Like my noble friend, I wonder whether applying to them all the bureaucracy of the Bill is a fair way for Parliament to recognise their efforts on behalf of the democratic process.

My Lords, I support the amendment. Having been chairman of the Conservative Party in Scotland, I know something about unwinnable seats, particularly in the Glasgow and Greater Glasgow area. Our biggest problem is that, if we do not do something about a cut-off point, the whole question of democracy in such areas can suffer. That will affect the Labour Party in Glasgow and the Conservative Party in the Cotswolds. It will do nothing for democracy if these constituency associations find it far too difficult and give up the ghost. Volunteers will not come forward and say, "I want to fight in an impossible situation".

My Lords, I support my noble friend Lord Hodgson, whose experience has already been alluded to during this brief debate. We are all conscious—the noble Lord, Lord Bach, made it clear during the course of our proceedings last night that he was conscious of it—of an inherent danger in the Bill. We are institutionalising and bureaucratising our political processes so much that we may easily kill them off.

The noble Lord was sympathetic in particular to an amendment put forward by one of my noble friends. The amendment suggested that an independent candidate should be able to describe his or her specific policies in up to five additional words on the ballot paper. I thought that the noble Lord's response was extremely sympathetic, although he confessed himself to be defeated by the problem. I hope that the noble Lord—if he is to reply, but perhaps his noble friend Lord Bassam will feel the same way—will acknowledge that there are inherent dangers in what we are doing, as has been made clear during our debates on the Bill. The opportunity—if only on the spur of the moment—to participate in politics as a minority is very important to our polity. We destroy that opportunity, whether by an imposition of bureaucracy or whatever, at our peril.

On those grounds alone, my noble friend has done a great service in tabling this amendment. I hope that the Government will be sympathetic to the arguments that he put forward so eloquently. I hope also that the Government may feel that, whereas it is extremely agreeable to be in permanent political dominance in, say, Newcastle, it is equally disagreeable for that party to find itself in the opposite position in, say, Bournemouth. We are all aware of the dangers in terms of complacency and perhaps—dare one say it?—occasionally worse if there is no challenge to a political party which is in a position of almost permanent dominance.

Therefore, anything which encourages small minority groups, whether or not they form part of one of the great parties, to be able to organise themselves in such areas is of enormous benefit not only to the overall body politic but also to local politics. I hope that the Minister will at least acknowledge that my noble friend has a point. Better still, I hope that he will pursue some of his more agreeable instincts and perhaps even agree to the amendment.

My Lords, the Neill committee did not go into a level of detail over whether there should be some minimum amount of constituency income below which the reporting and accounting obligations would be modified or eliminated. However, it seems to me that the Bill imposes a serious burden on small parties. I have to say that the political party to which I belong has rather more such constituencies than either the government party or the Conservative Party.

We are somewhat concerned about the detail involved. For example, a £1,000 donation has to be disclosed to a constituency party and there must be some mechanism for disclosing it. We would therefore have some hesitation about supporting the amendment as it stands, but it would be helpful if the Government could look at the matter again. Steps may need to be taken to close loopholes; for example, to prevent transfers from small parties to large parties as a way of getting around some of the restrictions. Having said that, in principle I would be in favour of anything that reduced what is a serious imposition on small parties. For example, the Bill may make it extremely difficult to get anyone to take on board the office of treasurer. We hope that the Government will be able to look with favour on what may be brought forward to deal with this problem.

My Lords, the noble Viscount, Lord Cranborne, invites my better instincts to come to the fore and other noble Lords have touched those parts of my political past which are perhaps strongly attracted to local democracy and ensuring that local democratic institutions are hail and hearty in all respects.

At first look I can see that the amendment might have its attractions. As I understand it, the noble Lord, Lord Hodgson, is advocating that, where the income of an accounting unit is £5,000 or less, the unit should be completely ignored for the purposes of the Bill. I am all for having a light touch where an accounting unit has a modest income, but I cannot advise your Lordships' House to go quite as far as the noble Lord suggests.

I see two particular difficulties with the noble Lord's approach. First, I think it inherently undesirable that a constituent or affiliated organisation of a party should be treated as part of the party for the purposes of the Bill in one year when its income exceeds £5,000 but not in the next when its income dips below that figure. We could have that strange and anomalous position. Secondly, the Neill committee recommended that donations above £1,000 made at a local level should be disclosable. It may be that an accounting unit has an income below £5,000 but attracts a donation of £1,000 or more from a wealthy local supporter. Under the amendment such a donation would not be disclosed. The noble Lord, Lord Goodhart, drew attention to that difficulty.

I put it to the noble Lord that the proper way to deal with accounting units with modest incomes is, as I have said, to apply a light regulatory touch. Clause 40 enables the commission to set different requirements for an accounting unit's annual statement of accounts according to three income bands, the lowest being incomes below £5,000. In addition, Schedule 5 exempts accounting units with an income below £25,000 from the requirement to submit their annual statement of accounts to the electoral commission. In practice, therefore, there will be few additional burdens on the treasurer of those accounting units with modest incomes.

If the Bill is applied in that sensible way and with that lighter regulatory approach, we will probably go some way to meeting the understandable concerns raised by the noble Lord, Lord Hodgson, during the course of the debate. I took careful note of what the noble Lord, Lord Goodhart, said. If a practical measure could be designed to assist that lighter touch but nevertheless capture, as Neill said, that £1,000 donation—that is an important and significant figure—I would be open to further representations. I do not believe that the noble Lord's amendment goes in that direction and I would therefore need considerable persuasion. For those reasons, I ask the noble Lord to withdraw the amendment.

My Lords, I am grateful to all noble Lords who have spoken in support of the amendment, even if some of them felt that the detail of it needed further brushing up. I found the Minister's response disappointing. He raised two objections to the amendment. First, he said that we have no way of disclosing individual donations. As I said in my remarks, the national party would still have responsibility for the local association. The national party would be responsible for ensuring that its individual constituent associations which were below the level would still have a reporting responsibility in respect of individuals who fell within the definitions given by the Minister.

Secondly, the noble Lord objected to the dipping in and out idea, whereby in one year an association had £5,500 and in the next year £4,500. I accept that that is a difficulty, but it is not beyond the wit of man to have a maximum and minimum limit or an average over a period of years which would enable a line to be drawn. That is too superficial, if I may say so with respect. The Minister espouses the cause of local democracy but then says that one of the main reasons for refusing the amendment is that we cannot find a way of defining £5,000. The price of local democracy is greater than that and with a little ingenuity we could find a way around the problem.

I do not propose to push my amendment any further today but I reserve the right to think about the issue and come back later on. I beg leave to withdraw the amendment.

moved Amendment No. 57:

Page 19, line 30, leave out from ("who") to ("so") in line 31 and insert ("shall be responsible for compliance on the part of the unit with the provisions of Parts III and IV").

moved Amendment No. 58:

Page 19, line 32, at end insert (": and

(b) another person who is an officer of the unit registered for the purposes of subsection (3).").

My Lords, of course I shall not move the amendment tabled in my name because, as the Minister rightly pointed out, the government amendments achieve the same end. Indeed, they go a good deal further because they address the problem as regards the Prime Minister. I confess that I did not bother to mention the Leader of the Opposition or the leader of the Liberal Democrats because I thought that the matter would be brought home to the Government slightly more firmly if I suggested that every time a constituency treasurer changed, a Minister would have to troop along to Downing Street to get the signature of the Prime Minister. I must say that I have never seen a government retreat quite as rapidly from a position.

My Lords, we may have retreated rapidly, but I hope that we have shown good grace.

My Lords, yes, the Government have shown very good grace. I was about to say that, in all fairness, I, too, would have retreated rapidly if I had been in the same situation.

I welcome the amendments. They improve the Bill and ensure that the provisions are more realistic in their operation in the real world. For that, I am most grateful.

moved Amendment No. 59:

Page 19,1ine 36, leave out ("person registered as treasurer of the party") and insert ("officer of the unit who is registered for the purposes of this subsection").

moved Amendment No. 61:

Page 21, line 20, at end insert—

("() Where the Commission refuse an application by a party under this section, they shall notify the party of their reasons for refusing the application.").

My Lords, I thank the Minister. When he responded in Committee, he stated that he had no doubt that the commission would set out its reasons in writing. However, he has not thought it necessary to specify such good practice in the Bill. Nevertheless, he has gone some way to meeting the point by tabling a helpful amendment which sets out that the commission should notify its reasons for refusal. I am grateful to the Minister for the amendments.

moved Amendment No. 62:

Page 22, line 2, at end insert—

("() Where the Commission refuse a request made by a party under this section in relation to an emblem, they shall notify the party of their reasons for refusing the request.").

moved Amendment. No. 63:

Page 22, line 2, at end insert—

("(5) The Secretary of State may by order, made on the recommendation of the Commission, vary the maximum number of emblems that may be included in a request for registration under subsection (1).

(6) An order made under subsection (5) may not provide for the maximum number of registered emblems that may be included in a request for registration under subsection (1) to be less than three.").

My Lords, I wish that the noble Lord had been a little more modest and had not moved the amendment. I am afraid that we do not feel that we can accept the proposal.

Part II re-enacts the Registration of Political Parties Act 1998 with such modifications as are necessary to establish a new scheme for bringing political parties within the controls on income and expenditure set out in the Bill. We have, however, sought to leave the 1998 scheme set out in the Act intact as far as possible.

One of the purposes of the 1998 Act is to protect a party's exclusive use of its name and its emblems in order to prevent voters being either confused or misled. The original intention had been to restrict political parties to the registration of only one emblem. However, as the noble Lord reminded the House, during the passage of the 1998 Bill it was pointed out that the Conservative Party used different emblems in England, Scotland and Wales. It was therefore conceded that a political party should be able to register up to three different emblems. Indeed, to have deprived a party of the use of an emblem with which voters in a particular part of the United Kingdom were already familiar would have run counter to the purpose of the 1998 Act.

We are not convinced, however, of the need to provide for an order-making power—as the amendment seeks to achieve—under which the maximum number of emblems may be increased further. The present arrangements will allow the registration of separate emblems for each part of Great Britain, and a party which also contests elections in Northern Ireland will be able to apply for the inclusion of further distinct emblems in the Northern Ireland register. But, on balance, we do not think that the aim of preventing the confusion of the voter would be well served by permitting any further proliferation of emblems. Although requests for the right to introduce order-making powers often emanate from this side of the House, on this occasion we think that this would be one power too many.

I hope that the noble Lord will feel able to withdraw his amendment.

My Lords, having listened with care to the argument I am sorry that the noble Lord takes that view. All I can say is that I am glad that it was the noble and learned Lord, Lord Williams of Mostyn, who faced me when we debated the Registration of Political Parties Bill on the occasion when I managed to persuade him to increase the number of emblems from one to three. As I recollect, I believe that the noble and learned Lord argued firmly in favour of only one emblem until he heard my arguments to the contrary.

However, I shall not trouble the House further with this point. I hope that over the next two or three years we shall not reach a stage where we find that we do need another emblem for one of the parties. We shall then be left to wonder why such a modest change had not been introduced to this Bill. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

moved Amendments Nos. 64 and 65:

Page 22, line 8, after ("emblem,") insert—

("() the addition or removal of a statement that a party is registered as a party with a campaigns officer,").

Page 22, line 39, at end insert—

("() Where the Commission refuse an application by a party under this section, they shall notify the party of their reasons for refusing the application.").

moved Amendments Nos. 66 and 67:

Page 23, line 7, at end insert ("or of any officer of such a unit registered for the purposes of section 25(3);").

Page 23, line 14, leave out from ("(d)") to end of line 16 and insert—

("(i) specify the name of the officer replacing the person currently registered as holder of the office in question, and

(ii) (if that person is so registered as an officer of the party) include an application for the registration of the replacement officer which complies with Part III of Schedule 4; and").

moved Amendment No. 68:

Page 23, line 21, leave out ("14") and insert ("21").

My Lords, Clause 29 requires that in the event of a party's entry in the register becoming inaccurate it must give the commission a notification by means of which the entry may be brought up to date. Where the notification requirement is triggered by the death or termination of the appointment of a registered officer, it must be submitted within 14 days; in any other circumstances, within 28 days. Amendments Nos. 68 and 69 seek to change these time limits to 21 days and 42 days respectively.

The noble Viscount expressed concern about the time limits in Committee. I can only stress again that the value of the register would be severely undermined if it were not at all times as up to date as is humanly possible. It is particularly essential that the names of registered officers who are responsible for compliance with the Bill are accurate. If, for example, the appointment of a party's registered treasurer is terminated, the party will have 14 days in which to notify the commission of that fact and to submit an application to have the relevant entry in the register changed. I accept that in that short period the party may not select and appoint a permanent replacement for that officer, but it should be able to name an official who will be able to take on the role in an acting capacity.

I recognise that the time limits proposed by the noble Lord are more stringent than those he suggested in Committee, but the Government believe that the time limits set out in the Bill remain, on balance, the right ones. For those reasons, I urge the noble Lord to withdraw his amendment.

My Lords, when one listens to the Minister, one begins to think that the Bill has been devised by those who have had nothing to do with the management of political parties. The noble Lord said that the commission would be "severely undermined"—I think those were his words—if the information was not accurate. That is right—but I do not think that it can be reasonably suggested that an extension from 14 days to 21 days would severely undermine the commission.

If one looks at the reporting requirements for companies, for example, almost all situations are covered by 21 days. One cannot think of many instances in company law—which company secretaries have to obey—that allow only 14 days for them to comply with its requirements. By and large, businesses know what is going to happen and have systems in place to deal with it.

In some areas, political parties are small and haphazard institutions. Noble Lords on all sides of the House will know of areas where their own political party is not strong but very weak. Imposing these requirements on representatives in such areas is going too far.

My amendments would not severely undermine the commission. Although I shall not take the issue further today, I hope that between now and Third Reading the Minister will reconsider the matter. Extending the time limit from 14 days to 21 days would make life much easier for the commission. It would make life easier for everyone if we were to have a sensible time limit. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 69 not moved.]

moved Amendment No. 70:

Page 23, line 36, leave out subsection (8).

moved Amendments Nos. 71 to 77:

Page 140, line 15, at end insert—

("() If the application is for the party to be registered as a party with a campaigns officer, the application must also give the name and home address of a person to be registered as the party's campaigns officer.").

Page 140, line 28, after ("treasurer") insert ("and of the officer to be registered for the purposes of section 25(3)").

Page 140, line 37, at end insert ("and

() (if the application is for the party to be registered as a party with a campaigns officer) by the proposed registered campaigns officer,").

Page 140, line 42, after ("treasurer") insert ("or as proposed registered campaigns officer").

Page 141, line 4, after ("9") and insert ("and (if applicable) paragraph 9A").

Page 141, line 8, leave out ("paragraph 9") and insert ("paragraphs 9 and 9A").

Page 141, line 22, at end insert—

moved Amendments Nos. 78 and 79:

Page 24, line 43, after ("treasurer") insert ("or campaigns officer").

Page 24, line 44, at end insert ("or campaigns officer (or any deputy campaigns officer)").

moved Amendment No. 81:

Page 25, line 2, leave out ("sections (Financial structure of existing registered party) and") and insert ("section").

moved Amendment No. 82:

Page 25, line 29, leave out subsections (7) and (8).

My Lords, this is an unlikely but possible scenario. I suggest that the best way of dealing with the point is to take the simple step that I suggested yesterday; namely, to remove from the Bill all references to "minor parties". I have made a little list of the amendments that would be needed; it is not extensive. That would get rid of this difficulty altogether. It is clear that, as a result of the change that was introduced yesterday to allow anyone to contest a parish or community council election without forming a registered party, there is no need whatever to provide for the registration of a minor party.

My Lords, the provisions that the amendment would remove serve a simple purpose. A party which has previously declared that it intends to contest only parish or community council elections and has therefore been registered—I know that the noble Lord, Lord Goodhart, is unhappy about this—as a minor party may subsequently decide that it wishes to fight, for example, local government elections. In order to do so it would need to comply with the full registration regime and submit details of its registered treasurer and its financial scheme. The subsections that the noble Lord, Lord Mackay, seeks to omit from the Bill make provision in relation to the submission of this additional information and the replacement of the party's existing entry.

The noble Lord has argued that these arrangements offer scope for abuse. An unscrupulous political party—if such a thing should ever exist—might register as a minor party and avoid the requirements of Part IV but then, immediately prior to a general election, change its registration so as to enable it to contest that election. I should point out that such scope for abuse would exist even if the Bill did not make provision for registration as a minor party since it is equally possible that a party which is not registered at all might seek to register at the last moment in order to evade the controls on donations.

However, is this likely? Given the requirements of the registration process, is a party determined to field candidates in a general election going to take the chance that registration can be tied up within a few weeks of the election? We doubt that. It is also the case that where a minor party incurred controlled expenditure, within the meaning of Part VI, in the 365 days prior to a general election, it would be subject to the restrictions on donations set out in Schedule 11. So a party that wished to abuse minor party status in order to take delivery of foreign money would need to stay its hand in terms of campaign expenditure for as long as it continued to accept those foreign donations.

It will always be possible to spot ingenious ways in which controls such as those set out in the Bill can be side-stepped. The noble Lord and others, perhaps with some justification, have already complained about the length and complexity of the Bill. We could add considerably to the length, if that is what noble Lords really want, in order to plug every conceivable loophole. In the last analysis the Government, and this House, have to make a judgment about whether a particular abuse is really likely to occur. We do not believe that it is likely in this instance. We have sought to cover the more obvious and likely loopholes—indeed, we debated one such loophole last night. As for the rest, our suggestion would be to see whether there is a genuine problem and then look to the electoral commission to come up with the solution. On that basis, I hope that the noble Lord will consider withdrawing his amendment.

So far as concerns minor parties—and the second plea within a few hours from the noble Lord, Lord Goodhart—we believe that we should keep the provisions in respect of minor parties in the Bill to allow such a party to register in order to protect its name. That was the purpose of the 1998 Act and it is as relevant to minor parties as it is to other parties.

My Lords, I am grateful to the noble Lord for his response. I wholly agree that my scenario is not entirely likely. It is possible, however, and nothing the noble Lord has said has persuaded me that it is not. I see his point about controlled expenditure within 365 days and I shall reflect on it. It does make the scenario less possible than I thought. The noble Lord's best argument was that the amendment would add to the length of the Bill. As he knows, the length of the Bill already scares me, and to add to it scares me even more.

However, I find the proposition of the noble Lord, Lord Goodhart, extremely attractive. I am absolutely certain that if the noble Lord says that he has a list of amendments in his pocket that would remove minor parties from the Bill, it will be a pretty good list, and will probably be acceptable to the parliamentary draftsmen. Perhaps I can tempt him by saying that if he includes it in an amendment at Third Reading, I should be quite keen on reducing the size of the Bill by lending my support to it. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

moved Amendment No. 83:

Page 26, line 15, leave out ("initially") and insert (", in the first five years after this Act comes into force,").

My Lords, I have more than sympathy for these amendments. As I said in Committee, this Bill will impose great burdens upon the political parties. We have talked about the damage to democracy in terms of parties not being able spend their resources on promoting their case, but having to act like accountancy firms in administering this bureaucracy. If the Government were to agree to this amendment, it would not be a big concession for them to make.

We should remember that the fundamental principle is to be found in Clause 32—namely, that the start-up costs of implementing this legislation will be covered by the £500,000 fund that all parties have agreed should be available to enable them to set up the mechanisms and administer the Neill proposals. Therefore, to accept the small sum, relatively speaking, of £200,000 over four years would not be a big concession for the Government to make. It would be a boost to our democracy. Parties may lose out in many ways because of what they will have to do under this legislation. This suggested provision would give them some small comfort in facilitating the operation of this legislation.

My Lords, I rise to support the noble Lord, Lord Beaumont, in his revised amendments. I believe that what the noble Lord is proposing is all of a piece with the objections that many of us have constantly expressed as to the potential effects of what is a highly bureaucratic and complex Bill. I am under no illusions whatever that our body politic should, for reasons of effectiveness and expediency, continue to be dominated by two substantial parties. I say this mainly because we are living in a era when we ought to worry substantially about the effects of extremism, especially as we see this becoming increasingly more menacing in our great European home. I refer particularly to Right-wing extremists. Therefore, it is important that the major parties should continue to be broadly-based coalitions and that those coalitions should attract—for reasons, again, of expediency—people who might otherwise be tempted under other electoral systems to support extremists parties, but who could come under the umbrella of the larger parties of either Left or Right.

My support for this proposal in no way undermines my feeling that the present electoral system performs that very sensible role. I am sorry that the Liberals have always failed to understand the essential importance of this at a time when extreme Right-wing parties are increasingly rampant among our European partners. Nevertheless, this practicality has to be tempered with the recognition that everyone who is interested in politics and does not want to support the main parties should not be unduly handicapped in the way that he or she is able to do so. A very large part of this Bill is, I suspect, introducing handicaps that do not already exist and from which we have benefited in our polity for many generations.

Therefore, although I find it difficult to see myself ever voting for the noble Lord's party—not because I disagree with its objectives, but because I fear that its recipes are not those for salvation but for disaster—none the less I very much respect his view that we should encourage anyone who wants to stand for minor parties to do so. State bureaucracy and the incorporation of parties into state bureaucracy should not prevent such people doing so. The noble Lord has done us a service. I hope that the Government will look sympathetically upon his amendments.

My Lords, I hope that the Minister will give very careful consideration to this amendment. It is possible that the drafting may not suit the Government. However, as the noble Viscount, Lord Cranborne, said, we ought to have real regard to the ordinary people who may belong to these strange, but sometimes useful, parties. Public life has become expensive. I have in mind an article that I read in my newspaper today, which really sickened me. A few weeks ago we applauded the Government's announcement of an award to former prisoners of war held by the Japanese during the last war. However, I see that the firm of solicitors representing those former prisoners is charging them some £3.5 million for its services. I am sure that the firm had to meet expenses and costs. But after the Government made this most generous gesture on behalf of the country, it seems strange that those who are, shall we say, in difficulties should have to pay a certain sum of money towards those legal fees.

I know that that example is slightly different from what we are now discussing—indeed, it is considerably different—but it indicates the cost of being in public life in the pursuit of justice. Therefore, if the Minister does not have the right answer today, I hope that he will reconsider the matter between now and Third Reading and that he will try to find a solution to a concern that I believe most Members of this House share.

My Lords, apart from the noble Lord, Lord Beaumont of Whitley, all the noble Lords who have spoken in this short debate would not vote for the Green Party if they had a vote. However, we are all sympathetic to the point that he made; indeed, that applies to this side of the House, to the Liberal Democrats and to the noble Lord, Lord Shepherd, a former leader of the Labour Party in this House. I trust that the Minister will take note of that fact.

Before the Minister even thinks that he can accuse me of supporting state funding by being sympathetic to this amendment, I should point out that this is nothing to do with state funding. I am sure that the noble Lord realises that this is to do with preventing small parties being bankrupted by the new arrangements. It is as simple as that. Small parties will just go out of business, so to speak, unless something is done. The amendment before us may not be exactly the right way to solve the problem. However, can the Minister say what consultations there have been with small parties about their compliance costs? What will the Government do to ensure that small parties do not go out of existence?

Unless the Government come forward with a reasonable answer to the concerns that have been expressed by noble Lords this afternoon, we shall have to think the worst of the Minister—which, I am sure, is something that we do not want to do. We shall wonder whether the only reason for the Government not supporting the amendment is that they wish to put out of business the Scottish Socialist Party, led by Mr Tommy Sheridan, a thorn in their side in Scotland.

My Lords, I thought that the noble Viscount was doing quite well until he made his final point. The noble Lord, Lord Beaumont of Whitley, indicated that he would return to the fray with further amendments on the issue. I commend him on his persistence. We have had time to reflect on the matter since the Committee stage. The noble Lord proposes a more generous conception of what might constitute "start-up" costs, with an additional £200,000 to be made available over the course of four years. I appreciate that what is at stake is a small sum of money in relation to the size of the public purse. But I remain unpersuaded that this amendment in its current form should be accepted.

I remind the House that the Neill committee made a specific recommendation in relation to start-up costs. By start-up costs it had in mind, for example, the purchase of IT equipment which might be required to keep track of large numbers of recordable donations. It is perfectly reasonable to suppose that that sort of investment, if it is necessary, will be undertaken at the outset, not three or four years down the line.

That said, the Government wish to ensure that adequate assistance is available to meet initial start-up costs and intend that a figure of £700,000 rather than £500,000 should be made available. We understand entirely the points made about smaller parties. At Third Reading we shall bring forward an amendment to give effect to the uplift I have suggested. As now, we envisage the funding being available in one tranche rather than spread over a number of years. The proposed increase is in recognition of the fact that, for a period of about eight months after the commencement of the controls on donations, parties will need to rely on more labour intensive means to check whether an individual donor is on the electoral register pending the introduction of an on-line system. By giving this undertaking to increase by £200,000 the start-up funding available, I hope that I have done enough to persuade the noble Lord, Lord Beaumont, to withdraw his amendment.

The noble Viscount, Lord Astor, asked a specific question about consultation. All parties had an opportunity to comment on the White Paper and draft Bill. Sadly, few chose to do so. However, that was not for the want of trying on the Government's part. We were genuinely interested in stimulating interest. As has been demonstrated during the passage of the Bill, that interest has grown since.

My Lords, before the noble Lord sits down, I hope that I may reinforce the earlier remarks of the noble Lord, Lord Shepherd. As the noble Lord may know, over many years I have been somewhat involved in trying to get the Japanese prisoners of war some recompense. This is not entirely in the context of the mini-debate we are having at the moment.

My Lords, if the noble Viscount will give way for a moment, I hope that he will put his remarks in the form of a question to my noble friend because of the nature of Report stage.

My Lords, I was about to do so but I had forgotten it. Will the noble Lord who represents the Government on the Front Bench please look into the matter that the noble Lord, Lord Shepherd, raised? I do not complain about the sum of £10,000 per person. The Prime Minister has been very generous and quite correct. Will the noble Lord please ensure that all that money does not go to the lawyers?

My Lords, as the noble Viscount well understands, that is wide of the remit of our discussions today. I thought that the noble Lord, Lord Shepherd, made an important point. I do not think that anyone in your Lordships' House would want to see lawyers profit at the expense of those who have suffered as a consequence of war. I say that with a lawyer sitting behind me and in the knowledge that I live with a lawyer. Therefore, perhaps I am entitled to make such remarks. I shall take steps to investigate the current situation but beyond that we shall have to look to the future.

My Lords, I am grateful to all noble Lords who have unanimously supported the amendment. We have made a good case. I am also extremely grateful to the Minister for having taken the measure away, having thought about it and having come back with some kind of a solution.

I am grateful for the rather small mercy that the noble Lord has produced. I look forward to seeing the amendment that the Government will bring forward at Third Reading. I hope that the Government will allow plenty of time—not that there is a great deal of time available—to enable us to study it and, if necessary, propose alternatives at that stage. However, in the meantime, and with some gratitude, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 84 and 85 not moved.]

moved Amendment No. 86:

Page 29, line 45, at end insert—

("() Any special provision made by regulations under subsection (2)(a) in respect of parties registered in the Northern Ireland register shall, however, only have effect in relation to any financial year of a party so registered during any part of which there is an order in force under section 68(1); and, in the case of any other financial year of a party so registered, any provision made by such regulations in respect of parties registered in the Great Britain register shall have effect in relation to that financial year of the party as if it were registered in that register.").

My Lords, if the Minister will give way, perhaps I may say that I have uncoupled the two amendments on referendums. I believe that it is a quite different point. Perhaps the noble Lord will repeat the two amendments he mentioned.

My Lords, Amendments Nos. 132 and 187.

My Lords, I am grateful to the noble Lord. I have uncoupled them. We shall come to them much later, I fear.

My Lords, I am grateful to the noble Lord for his help.

We return to a more constrained debate; I accept that point. As I have said on a number of occasions this is a difficult set of circumstances for us to confront and deal with. In those circumstances, we have devised a position which, while it is not wholly desirable, is desirable in those circumstances. It takes account of the political reality in Northern Ireland. It moves a step forward in the direction that the noble Lord, Lord Goodhart, suggested in Committee and it takes us some way forward into the future.

I am interested in the amendment in the name of the noble Lord, Lord Mackay. However, as I have expressed plainly to your Lordships' House, as a halfway house it is not one that we can readily accept at this stage. We do not think that it is realistic. But we are prepared to consider it more closely at some point in the future.

After all that has been said about Clause 68, I hope that the House will accept that it is not a provision that the Government have included in the Bill without giving the matter very careful thought. Our decision to do so was not taken on a whim. The Neill committee looked at the impact of its recommendations on Northern Ireland parties very carefully and took evidence from both the nationalist and unionist communities. It is right to remind the House that in the light of what it heard in Belfast the committee concluded that special provision should be made for Northern Ireland parties. The Government endorse that view. It is right that any such special provision should be regularly reviewed and I commend to the House the government amendments which provide for that. But, subject to those amendments being made, I ask the House to return this Bill to another place with Clause 68 intact. I beg to move.

My Lords, in addressing Amendment No. 86, the Minister has also dealt with the other important amendments to Clauses 67 and 68 in this group which stand in my name. I shall not say much on Amendment No. 86 which, frankly, does not seem a terribly important amendment in the grand scheme of things. However, the general issue introduced by Amendment No. 86 is, I believe, one of the most important parts of the Bill.

In Committee we discussed these matters at some length. Indeed, after the amendments made by the Government in Committee, Clause 68 is far more broadly drawn than when it came to your Lordships' House from another place. Paragraph (b) of Clause 68 now allows the Secretary of State to disapply any—I repeat the word "any"—of the provisions of Part IV or to apply them with such modifications as may be specified. Those amendments mean that the Bill goes much further than it did when it came here. It would not just allow Northern Ireland parties to receive foreign funding, and Sinn Fein, the IRA, and the political wings of the Real IRA and the Continuity IRA to receive cash from their supporters in the United States; that is bad enough. It would also allow the Secretary of State to modify or disapply anything in Part IV of the Bill. Indeed, the Government have said already that they intend to disapply everything in Part IV for four years in the first instance.

The Minister must spell out in detail—he did not do so in Committee despite our endeavours—the situations in which he believes that both those powers will be exercised. If, as he said, the intention is to exempt all Northern Ireland parties from all of Part IV completely, then why is there the need for the provision which envisages partial application but with modification? What is partial? What are the modifications envisaged?

The Government's intention to allow for a complete exemption from Part IV means that, for example, when Clause 60 is disapplied, Northern Ireland parties will not even have to report to the electoral commission the kind of donations they are receiving. So not even the commission will be in a position to know what is going on. If I may paraphrase the noble Lord's defence of that, it was that the commission could not be trusted to treat the matter in confidence. That does not say much about the confidence of Government in the electoral commission, or in the people they will appoint to it. I should have thought that if the signal being sent out to all our parties is that they cannot treat any information they give in confidence to the electoral commission as likely to be kept in confidence, I think that all our parties will be pretty horrified. That is particularly so in Northern Ireland. If that is the best argument that the Government can come up with, it is an appalling reflection on the commission that they are setting up.

Further to that, the Secretary of State will have the power to increase the £5,000 limit for public disclosure and the criminal offences in Clause 59 relating to the evasion of restrictions on donations will be disapplied.

As in Committee, the Minister has repeatedly referred to the special factors that apply when we consider Northern Ireland. We know that there are some special factors, but many of us are unconvinced that they lead us inexorably towards removing Northern Ireland from the whole of Part IV. In Committee on 10th October, at cols. 246 and 251, the Minister attempted to justify the provisions almost exclusively on the basis of the need to ensure the personal safety of Northern Ireland donors by not making public their names. He repeated those arguments today.

However, the Minister appears not to have understood the clause, which provides for far more than just the exclusion of donors' names from the public register. The clause will allow the Secretary of State to drive a coach and horses through not only the ban on foreign funding, but all the requirements of this part of the Bill, including the requirement to make donations reports and the criminal offences related to the restrictions on donations.

Your Lordships should see through the Minister's argument, clever though it was, that the need for anonymity is sufficient excuse for wholesale exemptions from all the restrictions on donations. In theory that may appear to benefit all the political parties in Northern Ireland, but we all know which political party and which so-called politicians it will benefit in practice. Why does the Government's argument that donors in Northern Ireland should not be identified publicly lead them to argue for a complete exemption on foreign donations and their reporting to the commission? On 10th October, the Minister tried to make a great leap from donor anonymity to the wholesale exemption of Part IV. He said:

"The Under-Secretary of State for Northern Ireland, George Howarth, met with representatives of the main Northern Ireland parties earlier this year. Although opinions were divided, there was a strongly held view in some quarters that exemptions from the disclosure requirements of Part IV remain essential".—[Official Report. 10/10/00; col. 247.]

That is fine. However, the Bill will create an exemption from everything in Part IV. That is a problem for many of us.

The Minister was kind enough to admit that if donor anonymity was the Government's only concern, my Amendment No. 125 to Clause 67 and the deletion of Clause 68—or at least of the blanket exemption powers in subsection (1)(b)—would be sufficient. Indeed, I think that he said that the Government had considered similar wording. However, they have made a great leap—I was going to call it a leap of faith, but it is a leap of bad faith—from donor anonymity to all the other aspects of the funding of political parties in Northern Ireland. That principally means a leap to the foreign funding of Sinn Fein/IRA, but the Government cannot bring themselves to be open and honest with the House.

I have accepted the Government's argument about donor anonymity—although I find it very hard to accept that the commission should not be told in confidence—but there is no justification for allowing Sinn Fein/IRA to accept foreign donations when no other political party in the United Kingdom will be allowed to do so. If the Government admitted that they had made a deal to allow Sinn Fein/IRA to continue to receive money from the United States because it is very important for them, at least we would have honesty and transparency—two words that the Government are so keen on—but we do not even have that. It would at least be pleasant to hear that explanation. We may not like it or agree with it, but at least it would be open.

I have agreed in my amendment to the creation of a separate register in Northern Ireland—although I am not happy about it—to allow for anonymity. However, I am bothered by the next leap from donor anonymity to receiving money from abroad. My amendments would prevent that.

Amendment No. 125 is fully consistent with the Neill committee's recommendation. To be fair, the noble Lord, Lord Goodhart, said in Committee that, although he was not entirely happy with the Government's proposals, he was not happy with my amendments either. I am sure that he will give us the benefit of his advice later. I believe that my new amendments go a long way to help him and the Government with the problem of anonymity.

I accept that, despite my best endeavours to allow contributions from citizens of the Republic of Ireland who are on the electoral register and resident there—that is an attempt to take another step towards the problem that the Neill committee addressed—I am risking a seepage of donations from North America. However, the same seepage of donations could arise for any party. Anyone in the United Kingdom could receive money from a foreign backer of one of our great parties and pass it off as his own donation. What is the difference? I am prepared to take the risk. If donations were reported in confidence to the electoral commission, it would be much more difficult for somebody in the Republic to be used as a conduit for American money. At least we would be seen to be trying to stop foreign donations. The Government are not just not trying to stop foreign donations; they are encouraging their continuation.

In Committee, I asked why a Scottish American who wanted to help the Scottish National Party should not be allowed to donate to it when an Irish American living next door could donate to Sinn Fein/IRA.

My Lords, my noble friend knows the answer as well as I do. If the Scottish National Party were to indulge in terrorism, donations would be allowed.

My Lords, I do know the answer as well as my noble friend, but I want the Government to admit it, because that would show how cowardly they have been. I find it hard to explain to my fellow countrymen, some of whom support the Scottish National Party—I do not understand why, but they do—why they should be deprived of foreign money when Sinn Fein/IRA is not to be deprived.

Amendments Nos. 129, 130, 131 and 133 would limit the duration of orders under Clause 68. The Government and the noble Lord, Lord Goodhart, have suggested four years. That is far too long. A debate every four years is not enough. At the least there should be annual renewal of exemption orders. Amendment No. 133 would require a vote every four years—roughly once per Parliament—on whether the powers should continue. It would be a kind of sunset clause. The amendments would provide for more parliamentary scrutiny and more flexibility.

When the amendments were discussed in Standing Committee in the other place, the Minister, Mr Tipping, was quite supportive and said that he did not discount annual renewal. Can we have the same encouragement from the noble Lord, Lord Bassam?

Like many noble Lords, I consider the Government's amendments unacceptable. In the other place, the Conservatives, the Liberal Democrats and the Ulster Unionists made very clear in debate and in the Division Lobbies their disgust at what the Government were doing. Mr Willie Ross, the Ulster Unionist Member, said:

"The provisions do not defend democracy, they betray them at the behest of those who occupy their current political positions by a policy of murder, mutilation and craven appeasement".—[Official Report, Commons, 14/3/00; col. 193.]

The Liberal Democrat spokesman, Mr Andrew Stunell, said:

"It is perverse therefore that we should say that there is one part of the United Kingdom where we cannot find a way of getting on top of the problem and that we need clause 63 to run away from it. This clause is based on the wrong underlying philosophy and the wrong legislative theory".—[Official Report, Commons, 14/3/00; col. 196.]

Far from taking on board our views and those of other legitimate parties operating in the other place and in your Lordships' House, the Government have come forward with amendments in Committee which make the situation even more unacceptable.

I am sorry that I have spoken about this for a long time but it is of vital importance to the consistency of this piece of legislation. If this peace process means anything, it means that all the political parties in the North of Ireland come into the same sort of political activity as the parties in Great Britain, which means that they come under the same rules. I believe that my amendments go a long way towards addressing the concerns which the Government expressed in Committee. It would be honourable for the Government to accept the amendments today so that we may move forward in agreement on the question of funding political parties in Northern Ireland.

My Lords, I rise to speak to Amendment No. 131 in this group standing in my name. Because this matter was considered in some detail by the Neill committee, I am speaking in a personal capacity and not on behalf of my party.

The Neill committee was faced with two problems relating to Northern Ireland. The first and easier problem related to disclosure of donations. Most of the evidence that we received, which we found convincing, suggested that there was a serious risk that requiring the disclosure of donations would put at risk the economic well-being and, in some cases, even the lives of the donors. We therefore recognised that in this respect there was a strong case for an exemption. We did not specifically consider whether that exemption should be applied to the details published in the register or whether it should apply at an earlier stage and apply also to remove the requirement of disclosure to the electoral commission. I can certainly sympathise with the feeling that it should be disclosed to the commission. However, I have an uncomfortable feeling that, perhaps not in fact but probably in the perception of those who make the donations, it would be seen as presenting an element of risk. I therefore find myself unable to follow the noble Lord, Lord Mackay of Ardbrecknish, on that issue.

The more difficult question concerned donations from what would otherwise not be permitted sources. For the reasons expressed in the report, the Neill committee came to the view that it would not be possible or desirable to exclude the possibility of donations from the Republic of Ireland to parties operating in the North of Ireland. We would not have wanted donations to be made from outside the Republic of Ireland. The problem was that we recognised that any such exclusion would be impossible to enforce because, once the possibility of donations from the Republic of Ireland had been accepted, it would be virtually impossible to trace them and so discover where the donated money had come from.

The position in the United Kingdom is, of course, different. If there is a suspicion that money has been donated by a donor on the electoral register in the UK, but as an agent for a foreign source, that matter can be investigated by the electoral commission and by the police. That, of course, would not be possible in respect of donations from the Republic of Ireland.

The upshot was that we recommended a permanent exemption for donations from the Republic of Ireland. In doing so, we recognised that this provided a loophole that could not be stopped up. The Government, arguably more honestly than in our proposal, recommended that this should be dealt with, not by providing on the face of the Bill a right of donation from the Republic of Ireland but by allowing exemptions from the general rules governing foreign donations in regulations made under Clause 68. That certainly causes me a good deal of concern, and I find it difficult and painful to accept. Nevertheless, I am reluctant to say that it should be rejected altogether. However, it seems plain to me that it should be the subject of review at regular intervals, and that if such exemptions are to be provided, they should be reconsidered from time to time by the Government.

I have tabled an amendment seeking four-year reviews. I have a good deal of sympathy for the proposal of the noble Lord, Lord Mackay of Ardbrecknish, that the renewal should be on an annual basis. I perhaps have even more sympathy for the view that not only the order but the clause itself should be reviewed at four-year intervals. Although it is clearly impracticable at the moment, the provision of a sunset clause, even if it is an infinitely deferrable sunset, is preferable. Because it gives an indication of hope that the situation may return to normal in Northern Ireland, it is preferable to simply allowing this provision to stand on the face of the Bill unless and until it is repealed by further primary legislation.

My Lords, all the speakers who have so far taken part in this debate have stated the obvious point that this Bill makes special provision in a number of ways for the province of Northern Ireland. All those ways are very remarkable in all sorts of aspects.

The first that seems to me particularly remarkable is the fact that a government who are dedicated to openness and understand clearly the importance of more openness, not only in government but in the way we conduct our electoral affairs, should feel that it would be helpful to the propagation of unarmed politics—the politics of the ballot box rather than the Armalite—for secrecy to continue; more helpful than that it should continue in the rest of the United Kingdom where, up until now, at any rate, Armalite and Semtex have not been in use.

However, if I were the Scottish National Party and really wanted independence, I suspect that the lessons of the past three years at least, and possibly longer, would lead me to believe that if I really wanted it, that would be the way to achieve it.

For those of us who have had anything to do with terrorism, whether in Northern Ireland or other parts of the world, on whatever side of the fence we have operated—I have operated in various ways on both sides of the fence—it is perfectly clear that the greatest aid to terrorism is secrecy. We all know that anybody who wants to fight terrorism and the culture of the bomb and the Armalite, and to pursue that fight in the interests of the ballot box alone, must show greater courage than any other political practitioner; than any of us who are happily resident in this country which still, on the whole, cleaves to the ballot box rather than the Armalite.

I suspect that those of us who watched with extraordinary admiration the courage of the noble Lord, Lord Fitt, as he fought that fight at the front line will know that it is openness alone, and a realisation of that, which has protected him. If he is to follow the logic of his convictions, he has to show a courage which I suspect I for one, and most others, would not be able to show. The Minister, who has been extremely courteous and understanding, has listened hard to the debate. However, I am sorry to say that here the Government are making it more likely that terrorism will flourish by encouraging a culture of secrecy which has done an enormous amount to encourage terrorism on both sides of the sectoral divide.

My Lords, I thank the noble Viscount for giving way. Perhaps I may ask him where in this debate we in government—and I in particular—are encouraging a culture of secrecy. The noble Viscount has been kind enough to pay me a compliment. However, I cannot see what it is that I am holding secret to this debate that colours the debate in one way or another.

My Lords, I thought that if one made a donation to a Northern Ireland party, one was allowed to keep that quiet. That is just one example.

My Lords, it is the case that the argument for withholding information about the disclosure of donations comes from a range of parties across the political divide in the context of Northern Ireland. That is for very good security reasons which I thought and hoped that the noble Viscount would understand.

My Lords, I am under no illusion that anybody who is courageous enough to take part in politics in the Province does so under circumstances which are extremely prejudicial to their personal safety. There is no doubt about that. However, my point still stands. If we wish to encourage the ballot box over the Armalite, the argument must apply that greater secrecy under those circumstances than applies over here will make it more likely that terrorism will flourish and that openness in our electoral affairs, particularly in the Province, will be an enemy to terrorism rather than the reverse.

It is for that reason that I find the provisions under Clause 68, and subsection(1)(b) in particular, extremely difficult to accept. However, I am the first to admit that any government taking the hard line I advocate will immediately place a number of people in the Province in severe danger. That must be so if we accept the logic of my position. Nevertheless we all know, from examples not only in the Province but elsewhere, that the people who have defeated terrorism are the ones who have shown remarkable moral and physical courage.

The second aspect which seems to me remarkable is the whole question of foreign donations. I thought that the noble Lord, Lord Goodhart, was absolutely right when he said that it would be easier if we forbade donations from the Republic because we would at least be able to have an additional measure of control within our own borders. I hope I paraphrase correctly.

My Lords, I said that in the context of the decision of the Neill committee that donations should be allowed from the Republic of Ireland a loophole was opened up which would not be available within the United Kingdom because there was no possibility in the Republic of Ireland of investigating the sources from which the money came.

My Lords, that is precisely what I understood the noble Lord to say. In practical terms, it would be easier to be able to have a greater degree of control if we forbade donations from the Republic and merely exerted consistency within the Bill and permitted donations only from within the United Kingdom.

My Lords, it is the case that noble Lords on the Opposition Benches have accepted that donations may come from the South of Ireland. That being the case, I argue that it would be virtually impossible to put an exclusive ban on foreign donations. Therein lies the weakness of that part of the noble Viscount's argument and of the arguments put by other noble Lords.

My Lords, with the greatest respect to the noble Lord, he has made my case for me. My case is that on purely practical grounds it would be most unwise to accept donations from the Republic. Indeed, as a subsidiary—

My Lords, the noble Viscount is part of a party which signed up to the Belfast agreement. Surely the spirit of that agreement would be blown apart by his proposition. We do not have an amendment before us today to give effect to the suggestion made by the noble Viscount.

My Lords, that is true. Perhaps I should have tabled an amendment to that effect. I am sorry I did not. Having been encouraged by the noble Lord, perhaps I should do so at Third Reading However, I am sure that he would discourage me from so doing. I suspect that our highest aspiration as regards the Province, indeed as regards both parts of the island of Ireland and, indeed, this side of the water, is to see an end to terrorism. If we want that to happen, one way is to prevent donations, not only to active terrorist units but also to those political parties on both sides of the sectarian divide which are closely connected with terrorist organisations, whether the so-called loyalist parties or republican parties.

For that reason, I would infinitely prefer to see no foreign donations put forward from the Republic of Ireland. As the noble Lord, Lord Goodhart, stated and, indeed, as the noble Lord, Lord Bassam, admitted, it would make control a great deal easier. It would not be foolproof but easier. That in itself would be intensely desirable.

I cannot help observing that during the course of the Disqualifications Bill, the noble and learned Lord, Lord Falconer, made a great virtue of consistency. He pointed out that, since we had such remarkably good relations with the Republic of Ireland, it should be treated, as regards membership of another place, in exactly the same way as Commonwealth countries. There is an inconsistency here as well, but I shall not pursue that particular matter.

My view is very simple. I believe that the highest aspiration that we can possibly aim for is the defeat of terrorism so that we can conduct our affairs throughout the United Kingdom according to the accepted rules to which all of us in this House cleave. For the reasons I have tried to explain, I regard any additional secrecy in the Province, which the rest of this Bill eschews—that is one of the things about it which I welcome—as an encouragement to terrorism rather than the reverse. I also believe that foreign donations from any quarter, including the Republic of Ireland, are in practical terms also an encouragement to terrorism for the reasons that the noble Lord, Lord Bassam, has given. Rather than improving our prospects of defeating terrorism, the matters which this group of clauses addresses will make it worse rather than better.

My Lords, I do not deny that this has been a very difficult debate. One thing that I wish to make patently clear is that I utterly reject the suggestion that the Government are craven in front of terrorism—that is not our approach at all—or that this exemption is in any shape or form a sop to Sinn Fein. It is not that, for reasons which I shall come to in due course.

A number of important questions have been raised. I shall try to work through the points in question that have been put during the course of the debate. The noble Lord, Lord Mackay, asked why there was the need for the power to modify Part IV of the Bill. As I believe I have explained, we may wish to adopt the noble Lord's half-way house; namely, that parties may be required to report disclosure of donations to the electoral commission, but for this information not to appear on the register of donations.

The noble Lord also made a point about trusting the commission. That is a fair point. We trust it and that is one of the reasons why we set it up. We also want to see it working effectively. However much trust we place in the commission to be hermetically sealed against leakages, the noble Lord probably knows better than I from his experience in government that it is not impossible for leaks to occur. We have all been the victims of leakages of information. So that is a debating point and no more than that. We trust the commission to do a good job in all the circumstances.

My Lords, I am grateful to the noble Lord for answering that point. Will he accept that most of the leaks in government come either from one's colleagues who are trying to torpedo a proposal that they do not like having failed to do so inside government, or the leaks comes from officials who do not like the idea either and equally want to torpedo it? One would hope that the electoral commission would not be in that kind of position.

My Lords, yes, we hope that the electoral commission will not be in that position. I do not know about leaks in government. They do not appear to have happened in my office as yet, but when they do I shall take a very dim view of them.

I return to the point under discussion. The problem that I have with the position taken by the noble Lord, Lord Mackay, is this. He has readily accepted the argument about disclosure. I believe that we now have a degree of commonality between us on that issue. But if there is not to be disclosure, then the case for exemption is stronger. It is made stronger still by the noble Lord's acceptance of the fact that it is entirely right, proper and realistic for political donations to be made from Southern Ireland into the Northern Ireland political situation for the political parties there. Once one accepts that, I believe the noble Lord's position becomes far less tenable.

I say that for these reasons. How, for instance, does one enforce the regime set out in Clause 68 when one cannot access the other jurisdiction? I think this goes to the heart of the matter. We would need agreement with the government of Southern Ireland if we were to try to give effect to a jurisdiction of that kind. We would need that government's full agreement. We would also need to see a situation develop in Southern Ireland where that country has a ban on foreign funding. In the current situation, and without all those measures, we could not expect to deliver a workable framework comparable with what we are seeking to put in place for the rest of Great Britain. I believe that the noble Lord understands that point.

That said, we realise that the situation needs to be reviewed regularly. We have said that four years is a realistic time frame—

My Lords, will the noble Lord address himself to three points? First, am I not right in believing that funding in the Republic of Ireland already has to be made public? I have seen a report that all major funding over a certain limit, which is not very high, is in the newspapers. Therefore, that will not be a novel thing for the republican government. Secondly, as my noble friend Lord Cranborne said, are we not supposedly in an era of great co-operation with Southern Ireland? Surely, if that is so, it would be no problem for that government to help the electoral commission to check. Thirdly, does not the noble Lord realise that I have gone a long way towards meeting the view of the noble Lord as regards my amendments on the anonymity of donors and my acceptance of the point in relation to the republic? That does not necessarily mean that I prefer that solution. I am trying to address the noble Lord's concerns by bringing forward intelligent amendments which will stop the main problem which is donations from the United States of America.

My Lords, as I have said from the Dispatch Box, I do not believe we have reached a consensus, but there is agreement on the difficulties in this debate. I congratulate the noble Lord on recognising them. There is good co-operation between our Government and that of Southern Ireland, but it is not for us to dictate to another jurisdiction how its laws should be framed or what measures it should take. As regards the noble Lord's first point, he is right in saying that there is provision concerning disclosure. There is no question on that point.

However, given the situation in Northern Ireland and all the difficulties that I have very carefully explained during the course of these several debates, I believe that we have gone as far as we can. It is for that reason that we believe that, at this stage in the development of the peace process and normalisation of politics in Northern Ireland, the exemption is justified. It is justified for only four years in the first instance. We shall certainly have to review it after that period. If political developments in Northern Ireland move faster than is sometimes indicated, in those beneficial circumstances we may wish to take further steps towards normalisation and see the effect of our legislation there. But there are many difficulties to overcome before achieving that objective, as I believe most Members of this House would agree. For all those reasons I urge the House to accept my amendment and to reject those in the opposition groupings.

moved Amendment No. 87:

Page 144, line 21, at end insert—

(" . A statement of accounts from an accounting unit which is not received by the Commission by virtue of the fact that the provisions of paragraph 6 do not apply shall be made available on request to any person by the registered treasurer of the accounting unit on payment of a fee which shall be specified in regulations made by the Secretary of State on the recommendation of the Commission.").

My Lords, the noble Lord, Lord Mackay of Ardbrecknish, is a better debater than he is a crystal ball gazer.

Schedule 5 of the Bill applies the accounting requirements in Part II to accounting units. Paragraph 6 of the schedule makes equivalent provision to Clause 43 in respect of the submission of annual statements of account to the electoral commission. Whereas the central organisation of a party must always send its annual statements of account to the commission, irrespective of the level of its income or expenditure, an accounting unit is only required to do so where, in a specific year, its income or expenditure exceeds £25,000.

This provision received some attention during the Commons Committee stage, where it was argued by the Opposition Front Bench that the operation of the threshold could lead to unfairness in circumstances where a local association in a given constituency was required to submit its statement of accounts to the commission but rival associations were not. The Government consulted further on that point but did not find any consensus among the main parties for a change in the provisions of the Bill.

That is not entirely surprising since Schedule 5, as it stands, deliberately places a light touch on the smaller local branches. If there is any doubt about a specific small local branch's activities, there is provision under paragraph (6)(2) of Schedule 5 for the commission to require the submission of a statement of accounts. Against that background I am not convinced that it would be right to place all accounting units under a duty to hand over a copy of their statements of account to any person where the commission itself has not requested one. If individual local associations want to make their annual statements of account publicly available, that is entirely a matter for them. But I do not see a pressing need to impose a statutory duty of this kind. For those reasons, I ask the noble Lord to withdraw the amendment.

My Lords, I am disappointed with the Minister's reply. I cannot pretend otherwise.

When this Bill is enacted it will become a source of irritation locally where, say, the Labour Party has a good constituency which takes it above the £25,000 limit and the Conservative and Liberal Democrat Parties—or, even worse, in Scotland the Labour Party and the Scottish National Party—are able to look at the accounts and try to glean whatever political advantage they can from them, yet local Labour Parties will not be able to do so with the accounts of their opponents because they will be below the £25,000 limit.

That will be a source of irritation, and when the second, third or fourth party in a constituency begins to try to make political capital in the local paper at the expense of the Labour Party because of what is in its account, members of the Labour Party will rightly suffer a feeling of indignation. When they do that, I hope that they will realise that we on this side attempted to make the playing field—if I dare use that term—a bit more balanced. I am sorry that the Minister did not accept my suggestion. I beg leave to withdraw the amendment.

moved Amendment No. 89:

Page 38, line 19, at end insert—

("() an individual registered in the register maintained by the Commission under section (Commission to maintain register of eligible voters for the purpose of donations);").

My Lords, Amendments Nos. 89 and 99 address a point which the noble Lord raised in Committee. The concern is that in restricting the definition of a permissible source to persons included on an electoral register the definition would exclude those who may, for reasons of personal security, choose not to register to vote.

Perhaps I may briefly remind the House why on this occasion we have considered it necessary to depart from the recommendation of the Neill committee—it was that those eligible to register should also qualify as a permissible source—and instead restrict the definition of a permissible donor to those individuals who are registered voters.

It is essentially a matter of providing the political parties with a simple workable test as to whether an individual donor qualifies as a permissible donor. It would, by contrast, be no easy matter for a registered party to establish whether a donor whose name did not appear on an electoral register was nevertheless entitled to register. The difficulty would be all the greater where the donor happened to live overseas.

Under the current rules for overseas registration, a party would need to establish that the person was registered to vote on the domestic register anything up to 20 years previously. The amendments seek to address the difficulty by providing that the commission should maintain a register of those who submit to it a notification that they are entitled to vote. Our main reservation is that the proposal merely transfers the difficulty to the commission. The commission will exist to administer and enforce the provisions of the Bill.

Providing it with the potentially difficult and onerous task of establishing whether a particular person is eligible to be registered as a voter in order to enable that person to make a political donation does not fit into that conception of the commission's role. Indeed, one could argue that to confer such a function on the commission would be to create a possible conflict of interest for the commission. It would, in effect, be doing the work of the registered parties for them; namely, establishing whether a particular donation could be legitimately accepted. Moreover, given the sensitivity of information kept in any such register, it seems likely that the commission would need to establish a secure means of consulting it.

We are sympathetic to the concern that there may be those who for perfectly good reasons choose not to register to vote and will as a consequence be unable to make donations—

My Lords, I am grateful to the Minister for giving way. Members of political parties are not the only ones concerned. A significant proportion of people in the constituency of Hereford are not on the electoral register. That is because they are either serving members of the SAS; are families of such members, are civilian workers in the SAS headquarters; or are in another way involved with the SAS. They do not register for security reasons.

We are talking not about a few people but about many people in such circumstances. I am not sure that the Minister has that in his brief.

My Lords, I am grateful to the noble Lord for his comments. We understand that it is a real problem and are not pretending otherwise. However, we make no special provision in order to enable people who are not on the register to vote. We are not therefore convinced that it would be right to go down a separate road in order to enable such people to make donations. It seems to us that the real problem is to find a way of getting those who for good reasons are loath to put themselves on an electoral register in a position where they are able to vote. That is the main problem. For that reason, we are not content with the two amendments tabled by the noble Lord, Lord Mackay, on this issue.

Amendment No. 100 relates to a different issue. It would require the electoral commission to maintain a national register of electors and to make the register available to registered parties. We discussed the proposal in Committee. The noble Lord wants an update on it and he is entitled to that. As we acknowledged during that debate, it is desirable that both the political parties and the electoral commission have easy access to electoral registers. In Committee, we pointed out that with the introduction of rolling registers such checks would best be carried on up-to-date registers maintained at local level. But, given the nature of the controls set out in the Bill, it would make sense for there to be a central access point to all 600-plus local registers.

The electoral commission project team is in discussion with the Improvement and Development Agency for local government and with the Association of Electoral Administrators on how online access to all local registers can be arranged not just for the commission but for political parties too. Ensuring the compatibility of locally held registers is likely to assist in making those registers more accessible. However, I have to tell the House that this is no small undertaking and we do not believe that it will be in place before next October.

We have been looking at ways to provide an interim solution which can be in place in time for the commencement of Part IV of the Bill. However, it has not proved possible to find a value for money solution which can be relied upon to be in place for February 2001. It is for that reason that we intend to increase from £500,000 to £700,000 the total sum of money available to meet parties' start-up costs, including the costs associated with making checks against the electoral register at local level. I would not be surprised if in the long term we returned to the issue of the role of the commission in relation to the registration of electors, but that is not a matter to be resolved now in the context of this Bill.

My Lords, the Minister has just read out a list of those who are consulting each other on this matter. The Minister did not refer to party professionals. I suggest that they should be consulted because they have the best experience at the sharp end of how to make such a system effective.

My Lords, that is an extremely helpful point which has been heard by the Government and should be acted upon.

The existing arrangements require local registers to be maintained in a common electronic format, and we amended the Bill in Committee to facilitate that. We do not believe, therefore, that at this stage Amendment No. 100 takes us much further forward. I have explained to the noble Lord what we seek to do and the difference between now and before. I do not claim that it will necessarily satisfy the noble Lord, but I ask him to withdraw his amendment.

My Lords, I begin with Amendments Nos. 89 and 90. I understand the noble Lord's difficulty. However, that difficulty would have been resolved by accepting my earlier amendments in Committee and doing what the Neill committee recommended. Certainly, that would have dealt with the problem faced by the military outlined by my noble friend in his intervention. We understand their position entirely. However, I can see that I shall not make much progress on that matter.

I had hoped to be greatly reassured by the response to Amendment No. 100, but the opposite is true. All that has happened is that political parties will get more money to help with start-up costs because of their difficulty in checking the eligibility of donors. It is amazing that we find ourselves in this position after many months' consideration of the Bill, reflecting the fact that the party professionals in the three main parties were not brought into the argument at a sufficiently early stage. That was a matter on which the noble Lord, Lord McNally, touched in his intervention. The position is that in an election next April political parties will be in very grave difficulty when it comes to checking the eligibility of donors. I cannot see a way round it, given the incompetence that has surrounded this issue over the past many months. Government have known for a long time that they will be confronted with a situation in which the political parties will be under an obligation to check weekly on the eligibility of donors. Yet they have not willed a system, let alone the means, to allow for an efficient check-up. That can be done where a party has a first-class local organisation, but a party with little or no local organisation may be in very great difficulty, especially when weekly reports are required.

I am very dissatisfied with the Government's position which will sow the seeds of real confusion when the Bill begins to be implemented. One wonders whether the Government should give serious consideration to holding their hand on the implementation of the whole of this matter until they have the means to sort it out. The position is very unsatisfactory. It may be that if the professionals in the parties read this they can come up with a solution which some noble Lords will be content to table as a Third Reading alternative to the predicament in which we find ourselves.

My Lords, I have listened with enormous interest to this debate. As someone who is totally devoted to everything electronic, I am very sympathetic to the view which has been expressed. But is there no possibility that the donor will himself be aware that he is on the electoral register? Is it not possible to ask him whether he is on the electoral register and, if so, where? Would that not solve the problem?

My Lords, he can say that but the point is that the political parties must check it. A donor may send in a donation and give the barest details. The donor may give his London address where he is not registered as opposed to his address in the country where he is; or he may give his address in Scotland or Northern Ireland where he is not registered, for reasons that we have already debated. The observations of the noble Lord, Lord Peston, who intervenes in a very interesting debate, underline his devotion to electronics. This portion of the Bill cannot be implemented until there is a central register; otherwise, this will be a retrograde step.

I return to the point that I reached in my winding up when the noble Lord intervened. The Government must give serious consideration to ways to enable this matter to become a practical proposition for the political parties at the time of elections. In the meantime, I beg leave to withdraw my amendment.

moved Amendment No. 90:

Page 38, leave out lines 23 and 24.

My Lords, I should remind the House that if Amendment No. 90 is agreed to, I cannot call Amendment No. 91.

My Lords, noble Lords will remember that one of the most endearing characters of Evelyn Waugh's satirical novels was a Prime Minister who rejoiced in the name of Outrage. Members of your Lordships' House will be as aware as I am that that name was bestowed in the spirit, perhaps, of exasperated irony. Synthetic outrage has long been one of the less effective weapons of professional politicians in every part of the body politic of this country. The noble Lord, Lord Shore, has never been prone to synthetic outrage. I am sure that your Lordships will be aware that the speech to which we have just listened was prompted not only by a typically genuine sense of the sentiments which he expressed but, beyond peradventure, given the arguments the noble Lord deployed, it was a speech that was very difficult to view in terms other than those he used.

We are considering here a genuinely outrageous piece of special pleading by what we are assured is not a superstate, as the noble Lord said, but possibly a superpower. Perhaps the noble Lord can define the difference between those two terms. I find it rather difficult.

I am honoured to be able to add my name to the amendments so ably proposed by the noble Lord. I shall not repeat the arguments that he set before us with such passion and clarity. I agreed with every single word. But I would ask your Lordships to remember that we are constantly assured by the proponents of the development of increasing European unity that we live in some form of association of nation states, that any sovereignty that we have lost has been pooled and, indeed, that were we to feel at any time that we had given away too much, theoretically at least this Parliament remains sovereign.

I certainly do not subscribe to that view because in practical terms, unless we leave the European Union, it will be extremely difficult, if not impossible, for us to garner back under the aegis of this Parliament the acquis communautaire that has already gone. In practical terms that is impossible. But let us for a moment suppose that it is possible; that we really are talking about a genuine pooling of sovereignty which has been voluntarily entered into by nation states and which nation states still control; that nation states are able through their parliamentary institutions to withdraw, to alter and to influence and that there is ultimately no superior body. We know that is not true. We know that every directive that is so assiduously debated, both here and in another place, and in relation to which we go through the motions, cannot be changed as to any jot or tittle and that despite that scrutiny there is nothing we can do to stop the application of those directives.

But let us keep to this fiction. We know that if it is true, in the end this Parliament must have the independence and authority to do what we are assured it still can do. If it is going to exert that independence and authority, I would suggest that the means by which we reach either House of Parliament and the rules which apply must be wholly within the control of the authorities which govern such matters. That authority must ultimately remain within the Palace of Westminster and nowhere else.

If that is so, then surely it is very peculiar that in a Bill that purports to do some very necessary things in order to make sure that our electoral system is not only fair and clean but is seen to be fair and clean—I applaud, as I think I have made clear during the passage of the Bill through the House, the objectives of the Bill although I quarrel with some of the means the Government have chosen to use to achieve them—the only two exceptions that are allowed as far as concerns foreign funding are, first, the potential foreign funding of the United Kingdom's parties by potential terrorists or active terrorists and, secondly, funding from other countries within the European Union and not countries within the Commonwealth or any other association of which we are a member. As the noble Lord said, the inconsistency is so glaring as to make the Government's position laughable.

I am so pleased that the noble Lord quoted his honourable friend Mr Tipping whose words are set out as clearly as may be in the Official Report of another place. The Government themselves accept in principle that it is a bad idea, so there is nothing between us here. But what we have is something completely different. The Government accept in principle that it is a bad idea, that it is inconsistent and that it goes against what they promised in their party manifesto and what they intend to put into operation through the Bill, yet they meekly accept the interpretation they have been given of Articles 43 and 46. I find that utterly astonishing.

I may not have been a very forceful Minister. When I first became a Minister I was a very callow one. But I hope noble Lords will accept that if I profoundly disagreed with the effects of a piece of technical advice that I was given I would do my best to ensure that the advice was in effect bomb-proof. From his quotation of that French opinion, the noble Lord, Lord Shore, has made it clear that this is anything but bomb-proof.

We must therefore conclude from his reasoning that the Government have feebly and meekly accepted the advice they were given. Why? Is it because they have become so used to doing what they are told by the institutions of the European Union that they do not realise that they can resist them?

That may be one interpretation. There is another more sinister one which I could not believe would be possible in respect of someone so honourable kind charming as the noble Lord, Lord Bassam. But one has to ask oneself, cui bono? Who will benefit from the funding that will come pouring in under this loophole from our friends in our great European home? It will be interesting to see who would be prepared to finance the general election in May. People will be interested. I have to make a confession to the House. Some years ago I had a friend—a business associate of mine—who was much interested in the results of some close-fought Greek elections. He suggested to me that because of the Greek electoral regulations, with which I was not familiar and did not wish to be familiar, I should make a personal donation to his party which would change the result of a key constituency on, if I remember correctly, the island of Lesbos. I hope your Lordships would approve of the fact that I rejected the opportunity of having such a splendid influence on the future of one of our European partners, as perhaps at that stage the Republic of Greece had just become.

It is a two-way street. If you are a businessman in one country, it is easy to realise that it is to your advantage to influence the political outcome of what happens in another. If it was true of my Greek friend, it would certainly be true in what is now the fourth biggest economy in the world that it would be to the advantage of people outside to influence what happens here. The problem is even more apparent—in this respect the second of the two amendments is more important—when it comes to the matter of referendums. After all, we know that vast sums of our money are already being spent on trying to ensure that we take a favourable view, rightly or wrongly—I happen to think, wrongly—of what is happening in our great European home. It is clear that that skews the amount of propaganda pouring down on to the British people, just as the funding rules set out in the Bill for the funding limits on referendums skew it further. If the amendments of my noble friend Lord Shore—I must call him my noble friend despite the conventions of the House—are not accepted, we shall find ourselves the subject not only of those first two distortions to the equity of any referendum but we shall find ourselves saddled with a third.

The Government know that they are wrong. Mr Tipping has said so. They know that they have been feeble. I hope that the Minister will be able to give a good example to his colleagues down the corridor of how Ministers should behave in matters of this kind.

My Lords, I deeply sympathise with the Government's dilemma which is expressed at some length in the Bill before us today. As my noble friend Lord Shore pointed out, both parties are in agreement on the principle that there should be limits on foreign funding. In fact, most of us would agree that money itself ought not to be the dominant factor in determining the political future of our country or any other country. If the provisions of the Bill were implemented meticulously—no one has so far had the temerity to suggest that they will not be complied with by the people to whom they are directed—the position would be a good deal better. The trouble is that all of us have split minds on the matter.

Those of us who have spent our lives in politics as such and in party politics as such and in arguing the various political philosophies to the people at large fancy that we can change the destiny of our country. We assume subconsciously that people are persuaded by rational argument put forward under completely fair conditions and that ultimately the people, thinking deeply, make up their own minds as to which course of action they will take and therefore how they will use their ballot papers. We know that that is not true.

The real power in politics is money. Even though it may not buy individual MPs, money has the power to create the climate within which people think. Money is able to buy editors and newspapers. It is able to control the entire climate of opinion in the country except for a few dissenters—like me and some of my colleagues who are occasionally prone to dissent when it suits us. We refuse to acknowledge that money is the problem we have to tackle. No matter what rules are set out in the Bill—I admire the diligent way in which it has been put together—money power can wipe them away in a fortnight. It is money that buys the means by which the public get to know what is really happening.

The public is already subject to considerable constraints. The amount of time for thinking that even dedicated politicians can set aside per day is extremely limited—and then look at what they get. Even democrats like us—what do we get? We are given stories, handed down by those who do not necessarily base their contributions on fact but who give the impression that they are the ones who really know what is happening. We are told of leaked minutes which allege what has taken place in Cabinet meetings. We are given the individual views of spin doctors as regards where certain politicians stand in the esteem of their fellows; what rows are taking place between them; and progress reports on the ebb and flow of power in the upper circles. We do not know whether any of it is true. Generally, it is this kind of information which forms the climate of public opinion.

In the ordinary way, we could wage the battle between democracy and money—it has been waged for many years—very much better than we are without any great personal effort. The first thing we could do would be to limit the powers of the bureaucracy. One of the main sources of power nowadays, suitably supplied by money, is in fact the members of the international bureaucracy. I do not refer to all of them—I am quite prepared to accept that they are honourable men—but it is in their nature to want to rule. Where there is an intellectual vacuum, which I regret to say is presently the case, the bureaucrats will certainly step in. Let us not try to pretend that this is anything but a fact.

The Council of Ministers in Europe has been referred to by my noble friend and by the noble Viscount, Lord Cranborne. That body does not rule at all. The Commission rules and it is composed of bureaucrats. Most of the material that comes from the Commission never alights on the desk of any parliamentarian. We pretend that everything is subject to scrutiny, but we all know that that is not the case. Most of the proposals, important or otherwise, pass straight into law under the provisions of Article 2 of the original treaty. We are not even in control of that. Furthermore, these are the people to whom we are to give way again.

Perhaps I may offer a simple illustration. The budget of the European Community, to which, noble Lords will note, we contribute £3.5 billion net every year, is finally determined by the European Parliament. We are given the impression that it is under democratic control, whereas of course it is not. The individual distribution of the European budget is subject to a system of qualified majority voting. The qualified majority system means that the money goes exactly where the Commission wants it to go. As we know well from the Maastricht Treaty, the Commission does not hesitate to play one member state against another as regards its budget allocation. Indeed, Maastricht only went through as a result of heavy bribery. I do not refer to normal, political bribery, but to the bribing of Spain and the Republic of Ireland to ensure that they did exactly what was wanted.

We can easily move away from this situation by ensuring that we, as politicians on whichever side of this House or the other place, begin to take control of our own affairs. We must ensure that our domestic affairs are not constantly led by bureaucrats, who are in fact responsible to us. In other words, it is not possible to get rid of the evils—those which my noble friend and his friends in the Government wish to do away with—or of winning the battle for democracy except by dint of hard resolve. We need to study our own part in it. We need to do our best and to argue as best we can. Furthermore, we should take nothing for granted.

Here, I am afraid, is where we are short on the ground. However much the Bill may seek to achieve—I hope sincerely that it is effective—unless we win the battle against the power of money and the power to buy and sell newspaper editors and journalists, we shall lose.

I have spoken for rather too long. Perhaps I may leave this thought with noble Lords: we have a country, to which we all owe an allegiance and of which we are all members. Unless we are prepared to face down the faceless people, who purport to act in good faith on our behalf, and begin to do our own thinking and then conduct matters exactly as we want—subject to the ordinary intercourse of politics—we shall fail. I pray to God that we shall not fail.

My Lords, by a curious coincidence, a day or so ago I received a letter from Mr Geoffrey Martin, the head of representations at the European Commission in London. I shall read the letter to noble Lords:

"Dear Lord Tebbit, the extract from your column of 16 July was included in Press Watch as an example of the bias, myth and hearsay which characterises coverage of European affairs in the British press.

Your readers ought to be aware that the ability of the UK to take decisions for itself is much more durable than you give credit. There are no 'masters in Brussels'. Ministers from the UK and the other 14 Member States remain the policy masters of the EU".

If Mr Martin is correct, this little problem which has worried so many of us, and which clearly has worried and intimidated Ministers, could be resolved quite quickly. It requires only that one of our Ministers should go to Brussels and assert his right, as has been set out by Mr Martin, to ensure that a policy is established which would enable us to ban overseas companies from funding political parties or referendums in the United Kingdom. I see no problem here. Furthermore, if the amendment is passed tonight—I hope that that will be the case—then a quick trip to Brussels by one of Her Majesty's Ministers will completely resolve this matter to the satisfaction both of Mr Tipping in the House of Commons and of the noble Lord who is to respond to the debate this evening.

However, if we do not win, then we shall see some amusing consequences; or at least, they would be amusing if they were not so extraordinary. Let us consider the argument which must lie behind this arrangement; namely, if a company in Hungary or Poland were to send a donation today to a political party over here, that would be a wicked and monstrous act of interference in our democratic affairs. But as soon as those countries sign the Treaty of Rome, it would become an agreeable, pleasant and proper way for them to behave. I find that incredible.

Indeed, perhaps some Members of this House are looking forward to the accession of Cyprus to the European Union. After all, from then on, Mr Asil Nadir will be free to contribute to political parties in this country—if he so wishes after the somewhat unpleasant experiences he has had in recent years—all by courtesy of the 15 Ministers who take such decisions in Brussels. As Mr Martin points out, they are not our masters in Brussels; they are our very own friends, taking decisions among themselves.

I cannot see what is the problem for Ministers. They should accept the amendment. They should buy a ticket to Brussels—which will not cost them a penny; it is our money—and go over there and sort it out. It should not take more than an afternoon, if Mr Martin is right.

My Lords, it is difficult to follow the magnificent speech of the noble Lord, Lord Shore, but, for what it is worth, I offer him my wholehearted support—particularly, although not exclusively, in regard to the issue of referendums. I shall be brief because I know that other noble Lords wish to speak.

Perhaps I may put two questions to the Minister. The first arises from the curious phraseology in Clause 52, to which the noble Lord, Lord Shore, drew attention, "or another member state". What on earth are we talking about? Does it refer to states, for example, which are not members of the EU but which, like ourselves, are in the European Economic Area? It would be odd if a Swedish timber firm with a subsidiary in Hull, let us say, was able to donate money to a British political party but a Norwegian firm with a subsidiary half-a-mile away from the Swedish subsidiary was not allowed to do so—although one would prefer that neither donation took place.

My second question concerns the issue of reciprocity. Will British firms with subsidiaries in France, Germany, Spain, Italy, Belgium, the Netherlands and so on be allowed to donate money to political parties in those countries? If not, then Clause 52 is even worse than it appears at first sight.

My Lords, if the excellent solution of the noble Lord, Lord Tebbit, is not taken up by the Government, what would happen if we simply did not proceed with this and accepted the amendment? How could any companies complain? How could any party complain? We are a sovereign country; it is difficult to see that they would be likely to take us to the Commission for having broken Articles 43 and 46. If they did, what would be the sanctions? Have the Government discovered what the European Court of Justice or the European Commission might do? Would they fine us? Would they order us to comply? What would they do? Any of those things would not be good politics from the Commission's point of view, nor, I would suggest, from the Government's point of view. It seems to me that people would be outraged.

If the Government are brave—or even sensible—and decide to do what they wish to do, and not to do what they believe they can be forced to do by the Commission, what sanctions could there be; how could anyone apply those sanctions; and what possible grounds could they advance for doing so?

My Lords, I support the noble Lord, Lord Shore. I shall be extremely brief because the noble Lord made his points with enormous conviction and persuasiveness. I have noticed that not a single noble Lord—not even one on the Liberal Democrat Benches—has risen to say a word against the amendment. I hope that we will have a contribution from the Liberal Democrats. It is strange how so often when we get a debate going on a good European point the Liberal Democrats are silent—and then they troop into the government Lobby. We should like to hear some justification for what they are about to do—although it would amaze me if they could give any justification for it.

My Lords, I was so completely in agreement with the noble Lord about millionaire's buying newspapers to peddle lies and propaganda that I did not think anything more needed to be said. The sooner we get Murdoch and Black out of the European debate the sooner we shall have a rational European debate.

My Lords, that may be an interesting point but it has nothing to do with the amendment. Perhaps, on reflection, the noble Lord will be able to think of a better argument when, as we anticipate, he finally speaks in support of the Government.

The case has been cogently made. I wish to add only one point—I shall be grateful if the Minister will reply to it—and that is this. I strongly support the Government's intention that there should not be foreign donations and foreign interference in both elections and, particularly, in referendums. The case that there should not be interference by foreign companies in referendums speaks for itself. Referendums are largely about constitutional matters; about how we live with ourselves and determine our own future. Such matters are for the British people to determine.

I have always been uncomfortable with foreign donations and I accept what the Government are doing. But if they are going to do this, it seems wholly wrong to make a law that is so partial, that affects only a part of the world and leaves another part unaffected. If a law simply states that a company in one country can intervene in our affairs but a company in another country cannot—if it treats different companies in different countries in a different way—it is a bad law. I support the Government's objective but, given what they are trying to do, this is a bad law.

I suspect that the Minister will say exactly what the Minister in the House of Commons said. He will say that he has every sympathy; he will wring his hands; the tears will flow and he will say, "But, however powerful the case put forward by the noble Lord, Lord Shore, and the noble Viscount, Lord Cranborne, the fact is that we cannot do anything about it and the law can only be applied in this way". I suspect that he will make a persuasive case. We will have lots of notes read out from that folder, the pages of which he is now thumbing, and he will again put a cogent argument explaining why we cannot do what the amendment seeks. I suggest that if we cannot do what the amendment seeks we should drop the idea of restrictions on companies. It is better to have no restrictions than to have a discriminatory law.

My Lords, I apologise for not having intervened in the previous debates on the Bill. I have been tempted to do so by the letter I received from my noble friend Lord Shore—I do not think it was confidential—informing me of the debate. He wrote—if I recall his words correctly—that he hoped I would not be as opposed to him on this amendment as I have been on other occasions. As I am, I thought I should intervene and say why.

I consider my noble friend Lord Shore to be a very good friend. He is a former Cabinet colleague with whom I get on very well indeed—despite the fact that I cut his expenditure as well as others. I listened with enormous interest to what he said about foreign funding and, I think I noted it correctly, how both major parties oppose foreign funding of referendums—particularly the one which may take place in relation to the euro—from whichever side the funding comes.

I do not intend to speak at length—I should like to see the issue come to a vote, if there is to be one—but it seems to me that much of what has been said has overlooked one simple point. We are not members of the European Union by accident; we are there because of treaties and Acts of Parliament which have passed through both Houses. They have been signed, whether willingly or not, by noble Lords who have spoken in the debate. They have been signed by governments of which the noble Lord, Lord Tebbit, the noble Viscount, Lord Cranborne, and my noble friend Lord Shore were members. They are treaties which were approved by both Houses. That did not happen by accident. The fact is we are members of the European Union.

I noted what the noble Viscount, Lord Cranborne, said about "synthetic outrage". I should make it quite clear that I have never accused my noble friend Lord Shore—and never would—of synthetic outrage. He sees the letters "EU" and he is outraged. I understand that. I have seen and heard it often.

I understood the noble Viscount, Lord Cranborne, to say that he wanted all authority to remain here, and for that to happen there was only one way out—for Britain to be out of the European Union. I disagree fundamentally with the many noble Lords who would rather that Britain was not a member. They include my noble friend Lord Shore, although he has never said so in terms. But we are a member of the EU. Both Houses of Parliament put us there. The government of which the noble Viscount, Lord Cranborne, was a senior member put us there.

I recall the debates on the Maastricht Treaty. My noble friend Lord Shore would say that it imposed terrible burdens on us. I do not recall the noble Viscount opposing those measures as a member of the government who introduced them. Now, he tells us that it is all wrong and we must not do this any more. I see the noble Lord, Lord Tebbit, leaning forward in his place. I know his views and I have accused him, perhaps wrongly, of being too nice a man for these matters. But, as Britain is a member of the European Union, it is surely right that those in other member states are no longer "foreign" in that sense of the word.

Game and set!

My Lords, I have used a word that offends my noble friend. I give way to him.

My Lords, so far as my noble friends are concerned, they are the same as citizens of the United Kingdom and must therefore have equal rights. That, of course, is the lie at the heart of the whole thing. They are friends and allies; they are not fellow citizens.

My Lords, I hesitate to argue with my noble friend on this issue. I disagree fundamentally with him and many other noble Lords on this matter. The plain fact is that if we are members of the same European Union under treaties which he supported—

I did not.

My Lords, my noble friend may not have supported them, but his government did, as did the government of the noble Viscount, Lord Cranborne, and the noble Lord, Lord Tebbit—who did not resign on those grounds either. I give way to the noble Lord.

My Lords, I am grateful to the noble Lord. He will remember that, after I had resigned from government, I strongly opposed the Maastricht Treaty. More to the point, when we signed the Treaty of Rome, did the noble Lord anticipate that one of its effects would be to prohibit us from preventing foreign money flowing into this country in support of particular political parties or causes?

My Lords, the noble Lord is at it again: he is using the word "foreign" in that context. We are all citizens of the European Union. The noble Lord may not like it, but it is a fact. I knew that I should provoke a number of noble Lords in the brief speech that I wanted to make. I have guests arriving shortly, so I had better make it quickly.

My Lords, perhaps I may impose again on the noble Lord's good nature. If he is right, why are personal donations from his fellow citizens of Europe in foreign countries prohibited under the Bill? Will he seek to introduce an amendment to put the matter right? Or is he being slightly illogical or even incoherent?

My Lords, it is possible that I am incoherent, and all kinds of other things, when I disagree with the noble Lord. I do not doubt that that is possible at times. I have often been guilty of all kinds of things. But we are talking about citizens of the European Union. That is the central point. That is what we all are. In that context, therefore, we cannot refuse members of the European Union who want to give funds, perhaps also from a Euro-sceptic point of view. That is presumably why the junior Minister in another place did not do so.

My Lords, perhaps I may interrupt my noble friend once more. If we are citizens of the European Union, surely we are also citizens of the Commonwealth.

Order!

My Lords, before my noble friend answers, this is an interesting and distinguished debate; however, this is Report stage, and we ought to get a move on now.

My Lords, I apologise for being too polite, but I have always given way, especially to my noble friend, as I have to the noble Lord, Lord Tebbit, and the noble Viscount, Lord Cranborne, and I am happy to do so. Nevertheless, I gather that I am being forbidden to do so now.

In response to my noble friend's question, the Commonwealth countries are not members of the European Union. That is a straight fact. I see him nodding in agreement. It is the European Union that we are talking about—of which we are all citizens. I do not want to waste any more of the House's time. The amendment is a pleasant one, but it is wrong. I hope that the House will reject it.

My Lords, is my impression that there is not considerable disagreement with the amendment. Therefore, I think that I should add another voice to the debate. I was under the impression that we were dealing with the Political Parties, Elections and Referendums Bill, not the "United Kingdom (Exit from the European Union) Bill". Unfortunately, as we do not have a Speaker in this House, we do not have anyone who can rule speeches out of order. However, I fail to see how most of what was said connects with the amendment or the Bill.

I want to expostulate with your Lordships on two matters. There was a suggestion in one or two speeches that the bona fides of the Government were being called into question. It was also suggested that the Government had a hidden agenda. To doubt the veracity of the Government or their desire to do the right thing is not a satisfactory approach to these matters.

I do not have the credentials that some noble Lords have for taking part in this debate. I have never sat in the other place, or even remotely thought it a worthwhile thing to do. I have never been a Minister. However, it is my understanding that Ministers have a serious role to play in public life, and that that role includes precisely what my noble friend Lord Barnett says; namely, that they act according to the law as it is explained to them. The suggestion is that, having taken the best possible advice on this matter from those who are legally qualified to give it, Ministers will say, "We do not like the consequences of the treaties that we have signed; therefore, we shall not proceed legally as Ministers of the Crown and, in many cases, Privy Counsellors. We are going to defy this and ask, 'What can you do to us, and what are your sanctions'?". That is not even a remotely satisfactory way for Ministers or ex-Ministers to address your Lordships on this or any other matter.

The matter before the House is simple and straightforward. We do not like foreign funding. I am much more extreme than many noble Lords. I detest all funding from businesses. I should very much like us not to go down the line that we see particularly in the United States, of vast business funding and an inability to take part in the democratic system if one does not have a lot of money. But we have not got quite that far. The Government have spoken honestly about what they would genuinely like to do, and they have been told by their advisers that there are legal limits to what can be done. There is no doubt that while we are citizens of the European Union there are restraints on what we can do. There was never any doubt about that from the moment the Treaty of Rome was signed by a British government.

I regard outrage, even if it is genuine, as no substitute for rational discourse. These amendments are ridiculous. I hope that my noble friend will press them to a Division because I cannot wait—assuming that it happens early enough—to vote against them.

My Lords, there is good sense in the amendment. However, I have been sorry to watch its supporters make it less and less supportable by linking it to taking a certain view on the position of the United Kingdom in the European Union. The serious reasons for doubting whether this clause should stand unamended have to do with the variety of accountancy standards in different jurisdictions within the European Union and the prospective European Union. When looking at the substance of the matter, we should ask ourselves whether we cannot set some barrier on contributions from companies in those jurisdictions whose accountancy standards do not achieve the openness and the transparency to which we aspire and which we may not always reach. The problem will only get worse if, as is likely, the European Union is enlarged but legislation in various parts of it does not keep pace with these standards.

Therefore, if the Government are absolutely convinced that it is not possible to draw a distinction between companies registered in various members states of the European Union, I hope that they will explain why they do not consider it possible to set other standards that must be met by companies that seek to donate funds to political parties in the United Kingdom.

My Lords, the noble Lord, Lord Lamont, invited some comments from these Benches. I know an elephant trap when I see one; indeed, if I did not, the contribution of the noble Lord, Lord Barnett, proved it beyond peradventure. If you begin by stating the facts and putting them into context, all that you provoke is a re-run of the debates that some of us have been engaging in for nearly 40 years. Perhaps I may assure the noble Lord, Lord Lamont, that we on these Benches are very happy to have that debate at the appropriate time—but not tonight; not on this Bill; and not on these amendments.

The contributions of the noble Lords, Lord Barnett and Lord Peston, and that of the noble Baroness, Lady O'Neill, put the matter in its proper context for a decision. Within that proper context, let there be no doubt that we shall support the Government in the Division Lobby tonight. In the meantime, I recommend a reading of the speech made by the noble Lord, Lord Bruce of Donington. Among all the verbiage that we have heard tonight, there was that very striking clarion call to release our media from foreign shackles, foreign influence and foreign distortion of our debates and political decisions. To me, that is a much more important issue in our democracy. I should be much more impressed with some of the speakers tonight if they espoused that as a cause. As I said, I assure Ministers of the support of these Benches.

My Lords, I now understand why the noble Lord, Lord McNally, does not have his noble friend Lord Goodhart sitting beside him in his usual place. I make that observation because, of course, the Neill committee was unanimous against foreign donations. Indeed, if the noble Lord, Lord Goodhart, had been sitting in his place, he would, presumably, have had to take the opposite line to the noble Lord, Lord McNally.

The Government's case might have some merit if they were able to say that this Bill had been introduced because of some EU treaty, or some negotiation or agreement, and that, therefore, we were bringing ourselves into line with best practice in Europe, or even with European law. Indeed, that might give this the figleaf of respectability. But they have not done so because they cannot make that claim.

While I was listening to the debate, I looked through Appendix 1 on foreign countries in the report of the Neill committee, which is extremely interesting. If we take Germany, for example, the report points out that,

"a business enterprise whose shares are more than 50 per cent owned by Germans … may contribute".

However, if that is not so, it cannot contribute. In Belgium, the report found that only private individuals are allowed to give to political parties, and that "institutional donations are banned". The position in France is quite clearly and helpfully set out in the report:

"Companies cannot donate funds to political parties".

Finally, as for Spain, the report says:

"Companies wishing to donate to parties must have the approval of their shareholders".

That is the only rule that seems to apply in that country.

So we have a bizarre situation. If a German company is 51 per cent owned by a non-German, it cannot make a donation in that country but it can do so in Britain under the Government's proposals. However, if it is 49 per cent owned by a foreigner it can, of course, do both. In Belgium, a company can donate in this country under these proposals but cannot do so in its own country. The same applies in France: a French company can give money to a political party here, but cannot do so in its own country. In Spain, donations must have the approval of shareholders, but in other EU countries no such approval of shareholders is required under their laws. One has to ask the Government—the Labour Party—this question. If they receive a donation from a company in Europe that does not have the approval of its shareholders, will they accept it or send it back to that country, which requires shareholders' approval for political donations?

My noble friend Lord Tebbit pointed out that a company in either Hungary or Poland will not be able to give to a party in this country. I can reassure my noble friend. He need not worry, because such a company can give that same donation in many European Union states. Therefore, one way or another, they can probably get it here. The noble Lord, Lord Monson, asked a question about what British companies can do as regards reciprocity. The answer is yes, they can do so in some countries, but not in others. There are no clear, uniform rules that apply throughout the European Union.

I am afraid that the noble Lord, Lord Barnett, somewhat confused matters in his interesting intervention. He spoke as if this Bill were part of some important treaty obligation. But it is not, and noble Lords are aware of that fact. The noble Lord also made one mistake and perhaps I may respectfully correct him. I believe he said that EU citizens would be able to give money to political parties. But, of course, they cannot do so; they have to be on the electoral register in this country if they wish to do so. Indeed, that provision is to be found in Clause 52 of the Bill. However, that does not apply in the case of Northern Ireland, where, because of the special reasons regarding Sinn Fein, such donations can be accepted. There is a real distinction in the Bill about so-called "foreigners" and so-called "English citizens" on the electoral register. I do not regard the term "foreigner" as being in any way derogatory; indeed, I am sure that they regard us in exactly the same way. We are all part of Europe. We are in Europe, but they are not on our electoral register and we are not on theirs.

The noble Lord, Lord Peston, in his interesting intervention said that we should not doubt the veracity of government. I have always doubted the veracity of government; indeed, even when I was in government. It is extremely important for us always to doubt the veracity of government, whatever it may be.

We have to ask why this extraordinary loophole has been left unamended. The Government have put forward no clear argument as to why this is necessary. Clearly, there are no such rules in other countries in Europe that are similar to this provision. We shall not be bringing ourselves into line with any European country; indeed, if that were so, it might be an argument in support of the clause. We shall be distorting the system and making ourselves more different from almost every other country in the EU.

My Lords, for long periods of time over the past hour and 11 minutes I thought that I was listening to a different debate from that organised by way of the amendments on the Marshalled List. Indeed, at one point it seemed to me that we were in the middle of a ferocious argument about whether or not we should be in the European Union. That certainly appeared to be the tenor of some of the contributions made by noble Lords.

However, from time to time we passed by the subject in hand and some undoubtedly very passionate speeches were made. My noble friend Lord Shore started us off in that vein. His views and clear hostility towards aspects of the European Union are both well known and widely respected; and, occasionally, put on one side. He made clear his hostility at an earlier stage to this piece of legislation and in particular to 'Clause 52(2)(b)(ii), as it presently stands. We also heard wide-ranging contributions from the Benches opposite, with protestations about the general loathing of donations coming from foreign parts.

I was especially taken by the contribution made by the noble Lord, Lord Tebbit. As I recall, he was a member of a government who, as I understand it, willingly accepted foreign donations not just from Europe but from a wide range of foreign countries such as Singapore and Hong Kong. The noble Lord referred to Asil Nadir. I am not sure whether it was during the noble Lord's time as chairman of the Conservative Party, but I recall that Asil Nadir made contributions to that party in large measure, if newspaper reports were to be believed.

The noble Lord, Lord Lamont, protested his desire to see us freed from the burden of foreign donations. I have waited a long time to hear that. The noble Lord was a member of a government who willingly accepted donations for a long period of time. The noble Viscount, Lord Cranborne, was not exactly innocent in that regard. I recall that he was a member of a government who willingly accepted donations from all parts of the globe. It was interesting to hear these new, fresh protestations of a desire to free us of the terrible curse of foreign donations.

We in government have taken a clear and, I think, principled position. We have made our position known to the Neill committee. We have argued the case. We in government have to deal with the practicalities of being in government. We have to confront the reality that government presents to us all. It is for that reason that we made our honest declaration to the Neill committee. It was through no failure on our part that the Neil committee came to the view that it did. The Neill committee recommended that the definition of a "permissible source" should include companies which are incorporated in the United Kingdom. There is no difference between all of us on that. There is certainly no shame on our part in saying, as our honourable friend Paddy Tipping said in another place, that the Government are firmly persuaded that it would be best to adhere to that principle but that we have to live in the real world. In the real world there is Community law. It is not craven to bow in the face of Community law; that is the reality within which we live. We must be realistic. No doubt many of those noble Lords who have contributed to this evening's debate will have argued in Cabinet, or perhaps within ministries when they were Ministers, that we needed to comply with international laws and also with the rules, as it were, of the club in Europe of which we are part.

The argument is, briefly, that companies incorporated elsewhere in the European Union must be allowed to carry on business here on the same terms as any company incorporated within the European Union. If the latter are permitted to make donations on the basis that they are entitled to seek to influence the political process in this country, so must the former.

The effect of Amendment No. 90 would be that, in order to qualify as a permissible donor, a company must merely be registered under the Companies Act 1985 and carry on business here. Beyond the undoubted pleasure given to the noble Lord in excising from the Bill any indication that Parliament has deferred to a point of European Union law, I fail to see what sort of a victory this amendment would represent. It would not prevent an EU-incorporated company making a donation to a political party, provided it was registered in the register of overseas companies. But nor, for that matter, would it prevent a company incorporated in the Cayman Islands doing exactly the same.

I remind the House that the Neill committee, of which the noble Lord is an honourable member, considered just such an approach and found it wanting. It is worth quoting what it had to say on the matter at paragraph 5.25 of the Neill report:

"We have considered whether foreign companies should be brought within the definition of 'permissible source' if they have taken advantage of the provisions of Part XXIII of the Companies Act 1985 by registering in accordance with the requirements there laid down … We do not consider that companies utilising these statutory provisions are in the same category as those which are incorporated here and are subject to the full statutory regime under the Acts. So we would not extend the definition of 'permissible source' to cover them".

The committee took the view that, if they were to qualify as permissible donors, companies should, as a consequence of their incorporation, be subject to the full regime of the Companies Acts which require that many aspects of their affairs are made public. I might point out that all companies incorporated within the European Union have to comply with EU company law directives which impose requirements in respect of accounting and audit.

I turn to Amendment No. 173. The noble Lord has argued that it cannot be right to allow an EU company to participate in a referendum held in this country. I might, however, point out that the effect of his amendment would also be to prevent a company incorporated in the United Kingdom doing the same. Nevertheless, the Bill provides that an EU-incorporated company may qualify as a permitted participant simply because it would be absurd to provide that such a company could make donations to a political party or a permitted participant but could not express its own views during a referendum campaign. As the noble Lord does not agree with the very premise of that argument, I doubt that it will cut much ice with him when I suggest that he should withdraw these amendments.

A number of noble Lords asked for specific points to be answered in my response. I shall try to cover some of them. I believe that the noble Lord, Lord Monson, referred to particular aspects of the Bill. He asked about the definition of a "member state". I thought that we had discussed that at an earlier stage of the Bill. "Member state" is defined in Schedule 1 to the European Communities Act by reference to the European Union. This applies by virtue of the Interpretation Act 1978. The noble Lord also asked about reciprocity. If other member states have equivalent rules on donations to political parties from companies, Community law would apply to such states. Their law would need to make equal provision for those incorporated in the European Union. But any breach by another member state is no defence to any breach by the United Kingdom.

The noble Baroness, Lady Park, referred to a couple of issues which I shall try to answer. It is worth reminding your Lordships' House that Article 43 has direct effect. The United Kingdom courts would not enforce provisions of UK law which contravened the article. If sanctions were applied in breach of an article, a defendant could plead the article to defeat any penalties, criminal or otherwise. In the case of permissible donors, a party could accept a donation from an EU-company carrying on business without fear of penalty.

The noble Viscount, Lord Astor, asked what happens in other countries. That is a fair point. However, in listening to his remarks I was somewhat puzzled as he did not give a single comparable example. Had he done so, I would have been somewhat less confused. Apart from that of Germany, the examples given by the noble Viscount, Lord Astor, show that there is no discrimination between EU companies. In France no companies can make the donations that we are discussing. That is a matter for French law. In Spain all companies can make such donations provided there is shareholder consent. However, the noble Viscount's examples did not shed any further light than that. It is for those countries to decide how they wish to—

My Lords, I am grateful to the Minister for giving way. I gave the example of Germany where a company has to be more than 50 per cent owned by Germans before it can make a contribution.

My Lords, I thought that I had acknowledged that point.

This has been a wide-ranging debate and noble Lords have spoken passionately, particularly those on the Benches opposite who have now decided that they dislike foreign donations, particularly if they appear to come from Europe. We are trying to deal practically with a difficult situation in creating a regulatory framework that is effective. We believe that the framework we have set out is effective. We also believe that we have to comply with our European obligations and, importantly, with aspects of Community law. That is the Government's case.

My Lords, before the noble Lord sits down, he mentioned that he acknowledged the point in regard to Germany. Will he comment on it? I know that he heard it, but I should like to know what he thinks about it.

My Lords, I am not in a position to comment on it. I shall take some time to study the example carefully. But we have been given clear legal advice on this point. I do not think that it would be right for us to put ourselves on the wrong side of that legal advice. Clearly other countries within the European Union—France and Spain—regulate in a slightly different way. We are trying to regulate in an entirely consistent way so that companies understand precisely where they are with regard to the UK electoral system.

My Lords, I shall be brief because I have spoken at some length. I am grateful to those who have supplemented, added and contradicted. It has made an interesting debate.

One of the most memorable contributions was the speech of the noble Lord, Lord Barnett. He advanced the doctrine of what I would call unlimited European sovereignty based upon common citizenship of the European Union. So it no longer matters whether you enter into a specific agreement, as we do with 101 international treaties which we honour and accept. That no longer applies. You hand over great areas of decision making to institutions, in particular the European Court of Justice, which then make the decisions which were previously made by your own Parliament. That is the real issue here.

To my noble friends I say again that this is a clear, unequivocal commitment of the Labour Party's manifesto and the clear, unanimous recommendation of the Neill committee. The Government do not want it. They would like to do without it but they are fearful of Europe and European rulings. The Government are anxious not to offend. Depending on how the House votes today, and on the outcome of this issue, we shall or shall not continue to proclaim that we have a sovereign Parliament and a sovereign electorate. If this goes, we shall have surrendered the very bulwark of our state, our nation and our society.

I say to those who are thinking of betraying this Parliament that I should not like to be them when looking in the glass when shaving tomorrow. I commend the amendment.