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Democratic Political Activity (Funding and Expenditure) Bill [HL]

Volume 785: debated on Friday 27 October 2017

Second Reading

Moved by

My Lords, coming from a rather ecclesiastical family, I like to start with a text:

“There is a broad consensus that election law is fragmented, confused and unclear, with … poor guidance from the Electoral Commission. Conservatives are committed to strengthening electoral law”.

That was the official statement of the Conservative Party in June this year, just a few days before the general election polling day. For the governing party—and it is still the governing party, albeit in a minority—to do nothing about that situation in this Parliament would be extraordinarily irresponsible. I am here to help.

The context for that statement was, of course, the continuing saga of the discrepancy between the control regime for local, constituency campaign expenditure, on the one hand, and that for national party election expenditure on the other. This is the most urgent of many problems that my Bill seeks to address. At this time on a Friday I am anxious to keep my remarks brief and, in particular, to avoid too much repetition from the debate on 10 March 2017, when my similar Bill in the last Parliament received its Second Reading. I have reread Hansard this morning, as, I am sure, have other noble Lords, and I stand by everything I said during that debate.

However, I remind your Lordships’ House, as the Minister did on that occasion, that this Bill owes its origin to a cross-party initiative in 2013, based on the analysis and recommendations of the report of the Committee on Standards in Public Life in 2011. Here I should say how disappointed I am that the noble Lord, Lord Bew, is not able to be with us. He has had a slight accident and has sent his apologies. He would, of course, be contributing in his usual very effective way as the current chair of the Committee on Standards in Public Life.

My approach has always been collaborative and remains so. If, for example, the House, the other main parties and the Government share the view of the Conservatives that there is “a broad consensus” on the need for reform, I will be only too happy for my Bill to become the vehicle to deal with the most blatant defects in electoral law. On 10 March the noble Lord, Lord Young of Cookham, said the time was ripe for,

“incremental reforms that achieve cross-party support”.—[Official Report, 10/3/17; col. 1622.]

Given the consensus suggested by that statement in June, I now submit that progress could and should follow as a matter of urgency. It would surely be unthinkable not to tackle the problems identified before another general election—or, indeed, another referendum.

In the debate in March I referred to the fact that since 1883 there have been firm rules to prevent individuals and organisations pouring excessive sums of money into constituency campaigns to secure the election of individual candidates. I am delighted to see the right reverend Prelate the Bishop of Salisbury here, because, of course, it was Old Sarum that was always given as the example we should all refer to in that connection.

In past elections the noble Lord, Lord Young, and I were often warned by our agents that if we did not check every single sum, every penny spent seeking our election, we or our election agent could end up in court.

The recent practice, by all parties, of their national campaign concentrating an ever increasing percentage of investment in a limited number of target seats, bypassing those local limits, has led to the investigative exposure, notably by Michael Crick and Channel 4, of what the Times subsequently described as “election fraud”. The report Elections for Sale?, published recently by the Joseph Rowntree Reform Trust, spells out in detail the consequences of this weakness in the law. I am sure that we all recognise the potential damage to the integrity and reputation of our political processes that is involved.

In March, I also expressed sympathy for the various individual MPs whose whole political careers could be at risk from that uncertainty in the law. The partial conclusion of the legal process since then has scarcely clarified the situation. Obviously, I make no reference to any outstanding legal action, but I am sure that Members of your Lordships’ House share my determination to make progress on the reform for which the Conservative Party was arguing in June. As long ago as 2010, my own party was arguing for much greater clarity in the apportionment of election campaign expenditure.

My Bill indicates in Clause 19(3) the national campaign activities which should now be separately recorded and capped as relating to the individual constituency. Its provisions include:

“(a) sending unsolicited material falling within paragraph 4 of Schedule 1 which is addressed to any person registered, or entitled to be registered, in the register of parliamentary electors for any particular constituency;

(b) making unsolicited telephone calls to such persons; or

(c) displaying digital advertising to persons based on the postcode in which they reside”.

If any Members of your Lordships’ House should think these are trivial matters, I draw their attention to the brief that gives us some figures on the expenditure by the major parties in these sorts of attempts to woo electors. We do not yet have the figures for 2017 but in 2015, the Electoral Commission reported that the total expenditure of all parties was £37.6 million but of that figure, £15.2 million was for material unsolicited by the elector. I submit that that very substantial amount of money is sent, as it were, to bypass local constituency campaign controls.

I am by no means wedded to the exact method by which we should do this. If we identify and regulate these activities, we can obviously find the best means by which they can be controlled. It is really important that the local candidates and agents should take on this responsibility, because I believe it is for them to take the full weight of that for money spent on their behalf. The key issue is to make sure that there is an appropriately increased cash limit. That, too, is something we can look at in the context of the Committee stage.

There is a similar consensus, I believe, that the rules governing the financing of campaigns for referendum outcomes must be re-examined. The fact that just 12 male millionaires—I do not know why that is significant, but it seems to be—provided the vast majority of private funding for the two campaigns in 2016 should surely give us pause for serious thought.

In the March debate, I and other speakers also referred to the huge sum invested by the DUP in that campaign. Curiously, every single penny of it was spent on the British mainland, where the DUP is not an active political party. Because the sources of political donations to Northern Ireland parties have been permitted to remain secret in the past, no doubt for some good reasons, this now raises serious concerns about transparency. The noble Lord, Lord Bew, made substantial reference to that anomaly in the March debate. Ministers could, and should, have dispensed with this out-of-date exclusion years ago. Now that the DUP is in cahoots with the Government, this mystery should surely be cleared up. In our March debate, the Minister reported that efforts were being made to regularise and standardise the arrangements for the whole UK. Have they been successful?

Thanks to the amazingly diligent investigation of Carole Cadwalladr and the Observer, we are also aware of the role played by Cambridge Analytica last year. Mr Arron Banks claimed that its artificial intelligence gave the leave campaign “unprecedented levels of engagement”, and he went on to claim it “won it for leave”, yet we still do not know, and apparently the Electoral Commission has yet to discover, who paid for those services. Was it the shadowy US billionaire Robert Mercer, who is said to own the company? Assistance in kind, like donations, from a foreign source raises serious issues. The Brexiteers thus stand accused of both lying and cheating.

Anyone who has read Dark Money, the product of very extensive research by Jane Mayer of the New York Times, will recognise just how dangerous it is for the UK to follow in the footsteps of the US by ignoring the influence of those with vast resources who want to play politics with their fortunes. In our debate in March the noble Lord, Lord Young, said:

“I agree that it would be better if all parties were less reliant on large donations and we had a broader base of membership donations on which to rely”.—[Official Report, 10/3/17; col. 1621.]

Here, too, there would seem to be growing consensus. There are suggestions in my Bill for the reallocation of the current very large amounts of state funding which could be redeployed to assist this.

In the interests of brevity, I do not want to reiterate all the points I and other noble Lords who supported me in March made in support of urgent attention to these issues. Indeed, the very comprehensive briefing note from the Lords Library sets out all the proposals in this Bill. I have only one correction to make in an otherwise impeccable account. In the second full paragraph on the fourth page—perhaps we could benefit from having pagination and numbered paragraphs—there is a reference to personal development grants totalling £2 million per year. I could do with one of those myself. I think I should also reiterate the point made in the previous debate, and underlined in the Library briefing, that my colleague Nick Clegg never objected to the reallocation of the very considerable existing sums of public state funding but considered a net increase undesirable in the austerity conditions of 2011.

In the current Bill, I do not suggest that the various proposals in Clauses 10 to 16 are implemented all at once but that in Committee we should look at which option would seem to be most advantageous. I am also making some suggestions about savings in the very large sums that the Government currently spend supporting various political initiatives, not least in their own advertising budget.

I am assuming that noble Lords have read the Hansard report of our previous debate, so we do not need to deal with all the points addressed then. Clearly, different priorities apply to each section of my Bill. I simply respond to the generous offer the Minister made to the House on that occasion. He undertook to facilitate discussion with the relevant Minister or Ministers to explore the potential for consensus and cross-party agreement. That has not happened in the intervening months.

The Minister sought to break the deadlock; it has not been broken. Given that remarkable Conservative change of attitude in June, with that claim of a broad consensus, I submit that the opportunity offered by my Bill should be grabbed by the Government as a sensible way forward. The Committee stage will provide a chance to explore commonly agreed priorities.

I repeat that I am only too willing, as I have been throughout this long period of gestation, to work with fellow reformers across parties. The public are looking to us to address some of these obvious discrepancies as a matter of urgency because politics has been brought into further disrepute by the inadequacy of the law. That was what was recognised by the Conservative Party in June. We must review with care those things which endanger the integrity and reputation of our electoral system. This too would fulfil the Government’s repeatedly stated willingness to proceed incrementally.

Throughout our debate in March, on all sides, there was a plea for consensus. That is the critical word today—that was the word that was used by the Conservative Party. It said that there is a broad consensus. The noble Lord, Lord Young, will, I am sure, be equally responsive, supportive and positive today. Again, I hope he will undertake to continue in the role of facilitator, for which he is so admirably well qualified, and I look forward with great optimism to his reply to this debate. I beg to move.

My Lords, here we are again: the same magnificent Victorian theatre; the same Bill, in effect, as I shall show; and the same dramatis personae, with the welcome addition of the right reverend Prelate and sadly, I agree entirely, the absence of the noble Lord, Lord Bew. I echo what the noble Lord, Lord Tyler, said about that, but that is about as far as I will go with the noble Lord, Lord Tyler. He ended, as Liberal Democrats so often do, with a call for consensus. But the preceding 15 minutes of his speech were partisan and often acid. Indeed, he repeated allegations which he made in March in relation to incidents which have been investigated by the legal authorities, and in respect of which no charges have been made—with no apology whatever.

I note 15 Members present on the Liberal Democrat Benches for this debate. In the previous debate, introduced by my noble friend Lord Holmes on the incredibly important issue of the scandal of the abuse of young people through unpaid internships, the Liberal Democrats could not even put up a Front-Bench spokesman on that matter. But they flock in—15 of them—for this debate. I wonder whether there is a political interest at stake here. Of course I welcome some of them, and it is particularly good to see the noble Lord, Lord Wrigglesworth, here again. In the proceedings on 10 March, which I too have read, he declared at col. 1608 that he and Ms Sarah Olney would, as he put it, “see” me “at the ballot box” in Richmond in May. Well, he and Ms Olney did come—I saw them—and Zac Goldsmith defeated them. It is great to have my honourable friend back in Parliament.

I have carefully examined the Bill and compared it with the Bill we discussed only a few months ago. There is an extra word in the Short Title—it is “Democratic Political Activity” rather than “Political Parties”. It has Latin numerals instead of Arabic ones for reference to parts of the 2000 Act—a change which, as a classicist, I cannot but welcome and think is correct, although I note one has been missed, on page 3, line 27. Dates are updated by a year to set them in the future, which is wise, and a useful explanatory parenthesis relating to your Lordships has been added to Clause 11(4)(c).

There is minor redrafting in Clause 12, relating to gift aid—a proposal I actually support. Last Session’s new condition G in Section 416 of the Income Tax Act 2007 has now become condition H. No doubt the noble Lord will explain in Committee if there is any significance in that. Another change is that the provision in Clause 17 of last year’s Bill requiring a valid candidate for European elections to have 1,000 signatures in his or her support is omitted. Is the noble Lord anticipating Brexit and not wasting time on reform of European elections? Or is it perhaps that the previous version was written before his party’s campaign for a second referendum—which the noble Lord called for again today—tanked and the party lost vote share in this year’s general election?

The very few narrow changes in Clause 20, relating to candidate expenditure, to which the noble Lord spoke, and the changes in Clause 19 relating to control of non-election expenses, reducing the limit further, present severe difficulties. They are technical, controversial and not so far the subject of consensus. I make no detailed comment, as this is outside my skill base, but I believe that assigning national expenditure to constituencies would be exceptionally difficult. Funnily enough, I instinctively welcome the idea of some limit on the tiresome bore of unsolicited digital messages based on postal codes. I am pretty sure that on this I am pretty off-message with both my Front Bench and Jeremy Corbyn’s friends in Momentum, but I will say no more in case I get an unsolicited message from Mr Jared O’Mara on the subject.

All in all, it is the same Bill as last Session, with a small addition that could have been a one-clause Bill, not a repeat of what we had before—a comprehensive attempt to rewrite the rules. I am sure that my noble friend on the Front Bench will probably say again, in my view rightly and fairly, and perhaps the noble Lord on the opposition Front Bench will agree, that these changes have to be agreed between the major parties so far as possible and made, as in the past, normally by government legislation with agreement, not a Private Member’s Bill in your Lordships’ House. Certainly any increase in taxpayer funding for political parties would be unthinkable at this or any other time, in my view. No taxpayer should have to pay more to support politicians than they do now.

Perhaps it is time to reflect on the ballot for Private Members’ Bills. This would not prevent any noble Lord bringing forward substantially the same Bill in successive Sessions, as we have here, although actually I think both Front Benches, both government and official opposition, who work so hard for us—we have two of the best of the bunch here in the shape of my noble friend Lord Young and the noble Lord, Lord Kennedy—might be spared repetitive stress syndrome on a Friday by having to deal with the same Bill after a few months. Perhaps the Procedure Committee might consider whether a second or certainly a third attempt at the same fence might not go lower in the ballot than a Bill that brought a new issue before Parliament.

I spoke on two important matters in March that the noble Lord, Lord Tyler, has completely ignored in his Bill. I will not repeat at length what I said; it is all in Hansard for 10 March 2017 at cols. 1602-04. I stand by every word, like he does. The issue is the inability of the Electoral Commission to order the repayment to victims of crime of political donations derived from the proceeds of crime, such as Maxwell, Asil Nadir or, more recently, the £2.5 million taken and, deplorably, kept by the Liberal Democrats from a shameless fraudster, Michael Brown, who ruined many people. All the parties that have criminal money, including my own, should repay it, but the case of the Liberal Democrats’ £2.5 million is particularly fragrant. I am sorry, I mean the opposite: flagrant. That gives me the opportunity to emphasise the point: flagrant. Shameless.

In March, my noble friend on the Front Bench encouraged me by saying this was something the Government would look at in the context of any review of Electoral Commission powers. If the noble Lord presses the Bill forward, I give notice that I will seek to amend Clause 24 to give the commission such powers and will expect the full support of the Liberal Democrats for that, with a pledge to repay the £2.5 million that Brown took. Then never again will victims of villains like Brown be turned away with impunity by a political party.

The second issue that I raised concerned a lacuna in the Representation of the People Act, which provides that a person who corruptly induces any other person to withdraw from being a candidate at an election by payment or offer of payment is committing an offence. I described the murky events surrounding the Richmond Park by-election in 2016, just before which it is admitted by the Green Party that an offer of £250,000 was made to promote a so-called progressive alliance between Greens and Liberal Democrats. In making this offer—self-evidently, given the fact that the Richmond Park by-election was impending—the willingness of the Green Party to withdraw its candidate and leave the field free for the Liberal Democrats, as indeed happened, would be a very material matter to the person or company waving this fat wad of money. If that were not obvious, a leaked email sent to a Kingston Green the day before its prospective candidate withdrew, reads,

“just reiterating that what I mentioned, about the party benefiting from us not standing, is confidential—please don’t circulate”.

That is the smoking gun that confirms that Kingston Greens were told that there was a direct connection between standing or not standing in Richmond Park against Mr Goldsmith and their party bosses having the chance of getting some dosh.

On the same day, there was a further illuminating exchange between two Greens. The first Green writes, in an email: “Do you know how much the amount is?”. “No, is it important?” “£250,000”. I will paraphrase the next bit because there is a right reverend Prelate present. “Just heard from Nick. Effing ‘ell”. It was rather more correctly expressed than that, but your Lordships know what I mean. Nick is widely believed to be Mr Nick Martin, chief executive of the Green Party, who clearly knows all that the public needs to know about the person or company involved. This attempted inducement was reported to the police, but prosecutors apparently decided that, as the prospective Green candidate had not yet been formally nominated, no offence was committed in her withdrawing. Furthermore, Section 107 of the Representation of the People Act has a lacuna, in that it applies to a person, not a party. I submit that it is a corruption of politics for big money to seek to procure the withdrawal of a candidate or of a party from a local or national election in any seat, and it is a corruption of politics for big money to seek to induce a prospective candidate not to seek adoption or be adopted. That needs to be exposed and stopped, and I hope that it will be addressed in law.

In conclusion, it is a stain on the high moral tone of the Green Party that it has not been prepared to disclose the identity of the person, company or party behind this offer. It is called an attempted offer; I say that it is really an attempted bribe. Caroline Lucas, the party leader, told the BBC in May that people in the Green Party knew who had made the offer but that she, very conveniently—this was on live television—had forgotten the name. There is no record of whether she sent a text message to Andrew Neil afterwards to tell him who it was when she remembered. Nick, Mr Nick Martin, is clearly one of those people in the Green Party who Caroline Lucas has said publicly knows the identity, and I call him out today in Parliament, in the name of the integrity and transparency of political party funding, to publish the identity of that attempted donor. As it is claimed that the donation was refused by the Green Party’s ethics committee, which we are told ensures that no donations are accepted, inter alia, from foreign sources, tobacco companies or other industries such as aviation, what could the Greens possibly have to hide? Surely it would put them in a good light if they saw this person off for good. Let Mr Martin also publish the minutes of the meeting of that ethics committee. Otherwise, I will seek to amend the Bill to enable the Electoral Commission to require him to do so.

Well, my Lords, I suppose I should thank the noble Lord, Lord True, for his totally non-partisan intervention on this issue and for being the only member of the massed ranks of the Conservative Party to come here to defend the totally unbalanced status quo which exists in political funding, which largely favours the Conservative Party, whatever anomalies there may be elsewhere.

I congratulate the noble Lord, Lord Tyler, if only on his perseverance. He has many times attempted to put this rather important issue before the House, and has again produced a detailed Bill. I suppose I have to declare an interest: I am in a very small way a donor to the Labour Party and in a past life have been both a collector and a receiver of rather large affiliation fees, which are relevant to this area.

The Bill is another attempt to clean up what most of the public regard as an appalling state of affairs in political funding. It is not that I agree with every aspect of this Bill; there are some provisions that I do not agree with, and some that I have reservations about—and I may come on to those. But it is important that we debate these issues. The public are concerned about who pays for our politics, how that is disclosed and what those who pay get in return for their donations. The noble Lord, Lord Tyler, takes as his template for this proposal the report by the Committee on Standards in Public Life under Sir Chris Kelly back in 2011. Again, while I support the overall thrust of that committee, I do not necessarily agree with all its recommendations. However, the reality is that successive Conservative-dominated Governments have not taken on board what was the central thrust of that report—namely, that the public do not trust the structure of political funding within this country. That needs to be addressed.

The scandal of the six years in between Chris Kelly’s report and now is that nothing has actually moved. Instead, the only thing that we got in the last Parliament —the first time we had had a majority Conservative Government for 20 years—was the Trade Union Bill, which actually made the balance more unfair. This is a bit of a nostalgic reunion party, because the noble Lords, Lord Tyler and Lord Wrigglesworth, and I sat on the Select Committee during the passage of that Bill, which restrained a bit the Government’s intentions. That Bill was supposed to be about industrial relations and the proper administration of trade unions but was in fact designed to undermine a very large proportion of the financing of the main opposition party—something which, if it had taken place in Belarus, would I am sure have been before the United Nations by now. We restrained it a bit, in the sense that we slowed it down. The report from that Select Committee, incidentally, was unanimous—particularly the part of it that did not propose to change the text of the Bill but called on the House and the Government to go back to the issue and reconvene the political parties to make a new attempt to address the issues raised in the original Chris Kelly report and those resulting from the attempt to change the balance that the Trade Union Bill represented.

The provisions of the Trade Union Act will still affect the long-term finances of the Labour Party. Nothing has been proposed, or is being proposed, to balance that out by an attack on what are, essentially, the main sources of the government party’s finances, which are donations from very rich individuals. That situation was compounded, as the noble Lord, Lord Tyler, said, during the referendum, when a large proportion of both sides was funded by donations from very rich individuals, with no requirement equivalent to the requirements on trade unions, which have to go through several hoops, with opt-outs or opt-ins, and have to set up a separate political fund, disclose and ring-fence it and reiterate the decision to have that political fund every few years. No other organisation or limited company, private or public, and, clearly, no individual has to go through similar hoops. The present balance—or imbalance—needs to be addressed.

There are some detailed points that I could make about the Bill, but I shall probably leave most of them to Committee. The most contentious one is that it would limit expenditure in elections and change the nature of the taxpayer-funded part of political funding, which could be a very difficult political sell. I am not sure that the Bill in present form addresses that sufficiently, although in other contexts the noble Lord, Lord Tyler, has made a number of suggestions that we should take into account. I am not sure that the changes in how taxpayers’ money is given to political parties that are dealt with in the Bill would actually alter the situation. I am not sure that we should totally rely on an amount per vote, and I am reluctant to say that it should all relate to the previous general election. Indeed, I am slightly surprised that the Liberal Democrats are proposing that. Maybe a longer-term run of popular support for parties should be reflected in any public funding.

There seems little appetite from the Government to take a new run at this, to set up an independent commission, to ask the Committee on Standards in Public Life, or even to bring in the political parties again to see whether they can reach some degree of consensus on the way forward. Admittedly, there is not much enthusiasm from the political parties either, but it is the Government who have in their hands the responsibility for the integrity of and public support for our political system. There is, therefore, an onus on the Government to give us some way forward.

I had a fairly lengthy additional point on this; the noble Lord, Lord Tyler, has, to some extent, pre-empted it, but the Bill does not. The Bill reads in a somewhat old-fashioned form, talking about a world of election addresses, mail deliveries, party-political broadcasts, election meetings and so forth, whereas we know that a lot of political discourse, and a lot of the most effective forms of political campaigning, now exist in the cyber world. Our present rules, frankly, do not address that. It is true that, when the election expenses for the last election come to be published, there will be a small line for the main political parties for advertising on social media—it has been reported this week that the Labour Party did rather better than the Conservative Party at that. It relates to placing adverts on Facebook or Twitter and is, as the Bill recognises, another form of media from traditional advertising, in one sense. But the reality is that political life in this country and elsewhere has been seriously affected by the existence of other forms of messages, not necessarily—in fact, not mainly—from political parties, but from influential, well-heeled individuals with nefarious but unpublished intentions throughout the world.

There are different views on whether the cyber intrusion into the political world is a good or a bad thing. Some regard it as a vast advance in democracy, others as a dystopian nightmare, but we cannot deny that it is there. It is true that, to begin with, progressives or, if you like, those on the left of the political spectrum, hailed it as a major improvement—the first Obama election, the Arab spring and so forth. The right in America regarded it as a negative thing, but then got to work. The book Dark Money, which the noble Lord has already referred to, spells out in great detail how American billionaires have greatly influenced the political weather within America, through the Tea Party, through their contacts and, essentially, not so much through advertisements and messages on social media but the intensive mining of sources of data on individuals and groups, which—without any permission from the originators of the data—were collected for commercial and other purposes. They then used that effectively to target their political message. The American right has been extremely successful. Initially, Donald Trump was not the main beneficiary of this, but he became the main beneficiary of it in the end. None of that appears in the accounts of the main American political parties, nor in the accounts of the legitimate election committees for individual candidates within America.

The noble Lord also mentioned that we had a small example of this very clearly in our referendum. This is a serious problem. If Cambridge Analytica and its related companies were using material that was not in practice declared, and if the DUP—the only political party that was party to that—was using it to campaign in Great Britain, one asks why, and also what the source of that money is. I do not know the answer to that. However, the fact that Northern Ireland has different rules on disclosure and allows, for good and understandable historical reasons, donations from outside the United Kingdom to be given to political parties, raises suspicions that that financing operates outside the normal rules for elections in the United Kingdom. Clause 29 extends the Bill to the whole United Kingdom. While we have to respect the fact that some provisions of Northern Ireland legislation are different, in general disclosure matters must be the same across the whole United Kingdom, particularly given that we are now in a situation where a party based solely in Northern Ireland is in effect part of the Government.

Some new issues have been raised. I commend the noble Lord, Lord Tyler, for bringing back the old issues, but the onus is now on the Minister and the Government. If the Minister is prepared to accept that the Bill should go further, we can discuss this again in Committee. If he wants to stop it, the best way of doing so is to announce today a new inquiry and that the Government will call together the political parties to see how best we can progress it, in which case I suspect that the noble Lord, Lord Tyler, will drop this Bill and rely on that process. If, however, the Minister does not give that commitment today, I hope to discuss some of these issues in Committee.

My Lords, I declare my interest as a former treasurer of the Liberal Democrats and as a contributor to them. I am very pleased to follow the noble Lord, Lord Whitty, who, as he mentioned, is one of a club of people in the House who take a close interest in these matters and have discussed them over many years, particularly in recent times.

I do not want to dwell on the past. We have rehearsed the arguments previously in this Chamber and certainly in the Select Committee with regard to the inequity of many aspects of party-political funding. As the noble Lord said, that is reflected in public opinion. The public see the inequity between the parties and would very much welcome a change to rectify it. However, the main thrust of my remarks is that things have moved on very quickly. I address that point to the Minister in particular. As the noble Lord said, changes have taken place that alter the whole landscape. In those circumstances, it is tremendously important that we discuss ways in which we regulate these things in the future.

My noble friend has been assiduous and persistent in raising these matters. I take my hat off to him for the way in which he has done that, and for reintroducing this Bill today and keeping these issues alive. It is a remarkable fact that Facebook was established in 2004, four years after PPERA—the main Act upon which our current system rests. That indicates the amazing speed of development of not only the digital world but of parties’ campaigning activities. A series of issues need to be, and should be, considered in all-party discussions. It would be much better to proceed on that basis than any other. I think the public would welcome the sight of the parties getting together to try to reach agreement in at least some of these areas of activity. It is not just a case of the inequity of this issue: candidates and party members, a large number of whom are volunteers, as we all know, who are doing responsible jobs in their spare time at constituency level and other levels in political parties, are being put in a difficult position. They are not always as well trained and qualified as one might like and they are being put in an extremely difficult position when the law and the regulation are unclear. Look at the use of data and Facebook advertising. The best example of it was in 2015, when the Conservative Party spent £1.2 million on Facebook advertising. I find it unbelievable that that was not targeted at individual constituencies and, within those, swing voters. All the parties are of course seeking to identify those swing voters in marginal constituencies, but that is a substantial amount of money. As I said, Facebook has appeared on the scene only recently, so this is a completely new development that needs to be taken into account.

As the noble Lord mentioned, the collection and use of data must be taken into account as it becomes more sophisticated. Artificial intelligence is being used to sift and analyse it so that the targeting of advertising and other activities can be more precise than ever before. We need also to look at the role and powers of the commission and the police in relation to electoral activity.

I once had a dispute over my expenses and know how much of a distraction and anxiety that can be. I am sure a lot of Conservative MPs have experienced that following the 2015 election and the inquiries into their expenses. It is a serious matter and can lead to the end of a politician’s career if things have gone wrong. There is so much uncertainty today around, for instance, the balance of national and local expenditure. What constitutes local expenditure in these days of digital campaigning and the use of data? We need to discuss that uncertainty and find a way to deal with it.

The noble Lord mentioned the position of Northern Ireland. Although dealt with in the Bill, that is another area that needs to be discussed so that agreement can be reached on how to proceed.

There is a series of issues giving rise to great uncertainty. That is unfair on the people working for parties, candidates and their supporters in their constituencies and around the country. We need to clarify this. It is for that reason, if no other, that all-party discussions on how we can proceed on these matters would benefit all the parties and enhance public confidence in our financing. I hope that in responding to the debate the Minister will say that he will institute discussions between the parties. We hope to have some breathing space before there is another election, though goodness knows whether we will or not, and local council elections are coming down the track in May in many parts of the country. It would be of great benefit if, before the next general election, we could have all-party talks to iron out these matters and bring some clarity to the situation.

My Lords, I too admire the commitment and persistence of the noble Lord, Lord Tyler, in bringing this Bill before the House. It was in November 2011 that the Committee on Standards in Public Life published a report on political party finance and found the current arrangements unsustainable.

My presence in this debate has been referred to a couple of times and perhaps it needs some explanation. I feel as though I have come into the engine room of the political process and am talking with a number of people who have been at this work for some time. I have arrived a bit like a chaplain in industrial mission. The role of the Lords spiritual is distinctive and one of our tasks is to lead daily Prayers. One of the best of those is, I think, when we pray for heavenly wisdom and understanding, laying aside all private interests, prejudices and partial affections. Our political system depends on a Parliament being able to do that. The pressures are subtle and money in particular can be seductive.

I am not sure whether a bishop has quoted Karl Marx approvingly before, but he said something like, “If you want to know what a person believes, ask them what they spend their money on”.

The Church of England has a tendency to talk itself down, but noble Lords might note that the Church of England is strongest in its local parish form, where something like 550,000 people commit to planned giving with an average contribution of £11 per week. The Church has always been one generation from extinction, but that has been so for 2,000 years and gives some grounds for confidence.

People give to political parties because of their beliefs. A healthy political party has many members and the picture is constantly changing. The rapid rise in Labour Party membership to over 500,000 means that the party has refound financial solvency. It changes the context of this debate, although there is, as others have pointed out, an imbalance in party political funding, which gets much comment.

Political parties would give a great deal for the confidence of the financial position of the Church of England with its contributions. The health of politics and civil society depends on funding that reflects involvement and commitment, but which also has a measure of public funding. It is right that we invest in the political process. It is part of a civil society—we do in fact do that—and this Bill attempts to strike a balance.

Money in large amounts buys influence and that can make it very difficult to lay aside private interests, prejudices and partial affections. It seems entirely right that there should be cap on political funding. That is not the same as donations to things such as charities, cultural events or capital appeals, but where there are large gifts to political parties, a few individuals can make something happen which is perhaps beyond the public good. The Bill is about the body politic and the health of democracy in which large donations are intended to skew the process by buying advantage.

The Bill is unlikely to make progress in the conventional way. There is not the time nor the necessary consensus on the way forward. Yet there is a consensus that we have a problem. That is what the Bill is trying to highlight. It would be sensible, therefore, for all sides to sit down together and work out what to do, in the way that the noble Lord, Lord Whitty, suggested. It is a role of Lords Spiritual to encourage the political parties to lay aside all private interests, prejudices and partial affections, and that is what I want to encourage noble Lords to do.

My Lords, today is another one of those debates that may feel like “Groundhog Day” for many of us and in which we may expect to go round the houses and fail to make progress. But the two-year parliamentary Session allows us time to make progress on a Private Member’s Bill, and the evidence of the last two general elections, the referendum, many media reports and what is before the courts strongly suggest that we should be adopting some of the measures proposed in the Bill

Indeed, the Minister himself in answer to a Question from me on 29 March about the ambiguity concerning what is local and what is national election spending accepted that the time will come when,

“we should stand back and look at the legislation to see whether we need greater clarity for all political parties in interpreting how that distinction should be made”.—[Official Report, 29/3/17; col. 590.]

Just because an issue is before the courts does not mean that Parliament cannot consider relevant legislation. If that were the case, Parliament would be able to consider very little legislation at all. It would make a mockery of democracy to leave the consideration of these issues until after another general election or referendum.

The House will be pleased to know that I will not repeat my arguments about these issues from the debate on a very similar Bill held on 10 March this year. They are of course available in Hansard at col. 1613 for all those interested in them. My noble friend Lord Tyler has already mentioned the excellent report published in full for the first time yesterday by the Joseph Rowntree Reform Trust. It is an excellent piece of work by Chris Bowers which asks the crucial question: do the present UK election spending limits prevent parties buying elections? If they do not, and the evidence he cites shows that they do not, then we do not have a healthy democracy because one that can be bought cannot be considered to be based on fair and democratic principles. In the report, Chris Bowers expresses concern that, “There is an array of loopholes and omissions of enforcement that are allowing candidates, parties and third party actors to bypass spending constraints, thereby jeopardising both the principle of the level playing field and the previously limited role of money in UK elections”. His report should be required reading for everyone concerned with the health of our democracy and the crucial link between money and politics.

Chris Bowers points out how the laws that were framed to avoid rich candidates or parties effectively buying elections are no longer working. Spending that is targeted in support of individual candidates in individual seats is not classified as such if it omits the name of the candidate and could also be described as national spending. But rather absurdly, it can mention the name of the constituency at which it is targeted, and the purpose of such spending is clearly to affect the outcome in particular seats. This spending may take the form of printed leaflets or letters delivered to voters either by volunteers or commercially by the Royal Mail and others. It can be adverts appearing on Facebook targeted at voters in a particular constituency and using data collected in order to target that constituency. But the costs of such advertising and the costs of the collection and analysis of the data may not be counted as local spending, thereby evading local spending limits.

The relevant legislation governing election expenditure dates largely from 1883 and 2000. The legislation from Gladstone’s era worked for a long time, but that from Tony Blair’s for a much shorter period. The introduction of national spending limits without a proper definition of national campaigning to prevent it being targeted at particular constituencies has been entirely counterproductive to the purposes of that legislation in 2000, as I warned at the time. The world of social media has now completely overtaken the legislation, and its costs, methodology and vulnerability to anti-democratic forces from other countries all require the introduction of some form of accountability to try to protect basic democratic values. My noble friend Lord Tyler and the noble Lord, Lord Whitty, also drew attention to the excellent work by Carole Cadwalladr, looking at the role and funding of organisations like Cambridge Analytica. Her work states the following:

“A shadowy global operation involving big data, billionaire friends of Trump and the disparate forces of the Leave campaign … influenced the result of the EU referendum”.

These areas of campaign activity need to be properly examined if we are to ensure that our election laws are fit for purpose.

Finally, the scandals of all parties and referendum campaigns that depend on the donations of a few rich individuals will continue until we cap donations at a sensible level and consider redirecting some of the Government’s advertising budget to extend existing levels of state funding to support our democracy—something which does not come free.

My Lords, I congratulate the noble Lord, Lord Tyler, on securing a Second Reading of his Private Member’s Bill. It raises important matters concerning our democracy and the conduct of elections in the United Kingdom.

Some aspects of the Bill I very much agree with but others I do not. I also think that with the pace of technological change, although some measures outlined in the Bill would be new if they became law, they would not completely have the intended effect—in particular, the clause on the free delivery of candidates’ election addresses and Schedule 3 on election addresses and booklets. Although there is nothing wrong in principle with what is proposed here, I think that the collection and use of data by political parties and third parties is a huge issue that should be addressed by Parliament, and that election addresses and other leaflets are having less and less of an impact. My noble friend Lord Whitty made an important point about data-mining and the worrying trend of the abuse and manipulation of data that we are seeing. The noble Lord, Lord Wrigglesworth, was right when he spoke about the speed of change in technology, which will only get faster, and the fact that our laws are struggling to keep pace with that change.

The noble Lord, Lord Young of Cookham, may tell us shortly that there is a willingness on the part of the Government to initiate constructive discussion with the parties on these and other matters to see whether agreements can be reached but that they cannot impose consensus. If that is the case, it should happen with all haste, as the noble Lord, Lord Tyler, said. All of us in the House are well aware that the Government are drawn from one political party, so they have more interest in this matter than a statement such as that would suggest—they are not an uninterested, independent observer in these matters. As many noble Lords have said, we are at the start of a Parliament which may well run its full term, so this would be the best time to seek to make progress.

To digress slightly, I was delighted that the noble Lord, Lord True, spoke in the debate. I have not had a chance to speak to him of late but I am conscious that he recently stood down from his role as leader of Richmond council. I just want to pay tribute to him for the work that he has done there. He has been an excellent leader and is well respected throughout London and in local government circles. I suppose that, now that he has left those duties, we will see more of him in this House, which can only be of benefit to us all.

Moving back to the Bill, it is a matter of regret that it risks making slow progress, as do many other Private Members’ Bills. As I have repeatedly brought to the attention of the House, that is because the Government will not allow Private Members’ Bills to have their Committee stage in the Moses Room. I do not know why that is so. If some Bills were sent there, we could make more progress overall, and the business would certainly go through more quickly than at the snail’s pace that we often experience on private Members’ legislation in this House. Many of the Bills are sensible and uncontroversial, and would be beneficial if they reached the statute book. I see the Government Deputy Chief Whip in his place. Perhaps he will take my remarks back to his colleagues.

As I said, I do not agree with all the clauses of the Bill but it is enabling a positive discussion to take place. Prior to the election of the Labour Government in 1997, there was in effect very little legislation in respect of donations to political parties, the regulation of political parties and the regulation of campaign expenditure at a national level. The Labour Government then asked the Committee on Standards in Public Life to look at these areas and, largely out of that, we got the Political Parties, Elections and Referendums Bill, which became law in 2000, and the birth of the Electoral Commission.

I was one of the first electoral commissioners to be appointed who had been active in a political party. I and my fellow commissioners from political parties brought to the commission and its discussions a different and, I think, welcome insight into how political parties operate. There then followed other legislation to deal with a variety of issues, including loans to political parties, postal voting and individual electoral registration. Seeking agreement among the parties was always a high priority and, for me, that has to be the way to proceed.

Since then, I am afraid that that has not always been the case. You have only to look at the decision to speed up IER, the reduction in the number of parliamentary seats by 50 and the curtailing of the boundary inquiry process while, at the same time, increasing the number of Members in this House. That latter move was made by the previous Prime Minister and people were shocked by it when they compared it to the number of appointments to this House made by his predecessors, whether they were Labour or Conservative Prime Ministers.

Going through the Bill, I have no objection, in principle, to donation caps, but they have to be done in a way that will not undermine a political party’s funding, as legislation cannot be used to damage one party to the advantage of another. The parties in Britain today that are represented in the House of Commons, devolved institutions and, for the time being, the European Parliament, have evolved over time, with unique histories, funding structures and mechanisms. That must be respected.

I am not sure the figures in the Bill, as set out in Clause 3(3) are correct. They will need to be looked at very carefully. There is a strong case for the donation recording and reporting figures to be looked at and uprated in the present legislation, as they have not been changed for many years. There is no mechanism to take account of inflation, which is a failure of the present legislation. Perhaps the noble Lord, Lord Young of Cookham, could address that point in his response.

An affiliation fee, paid by an individual member of a trade union to a political party, is an individual donation. I have been a member of the GMB union for over 28 years. I pay the political levy; it is my money and the donation to the Labour Party is from me. Trade unions are some of the most regulated organisations in the United Kingdom. Not all trade unions have political funds, and even of those that do, not all are affiliated to the Labour Party. I agree with the comments made by my noble friend Lord Whitty in respect of the Trade Union Act. Some of the regulation is a little overbearing, to say the least. We often hear from the Government about red tape and excessive regulation, although that never seems to apply to trade unions. I would want to look carefully at the parts of the Bill that refer to trade unions, namely Clauses 6, 7, 8 and 9. I would also want to look at them in the round, alongside other legislation on political donations, such as political fund ballots. Such legislation should be looked at during this period as well.

Proposals around match funding for registered supporters and amounts-per-vote schemes have been talked about for many years. Again, I am not against such schemes in principle, but they have to be looked at in the overall context of the cost of politics and the financial situation we find ourselves in as a nation. On the other side of the equation, removing large donations from politics in the United Kingdom—and with that, any suggestion that people who make large donations are seeking some sort of advantage or influence—means that money has to be replaced from elsewhere.

The provisions that refer to enabling Gift Aid to apply to parties that meet the eligible represented registered parties test seem a good idea. That might encourage many more people to make donations of a smaller amount to parties, which is a good thing. More small donations attracted by parties are to be welcomed. One of the problems we have in the United Kingdom is that making donations to political parties is not seen by large sections of the media and others as a good thing. People give to charities to support good causes and they seek to do good with the money they can afford to donate. However, they always run the risk of being attacked if that donation is to a political party—but praised if it is to a charity or another good cause. Healthy, functioning political parties are essential to our democracy. Joining a political party, campaigning for it and donating money to it should be welcomed and encouraged. The right reverend Prelate the Bishop of Salisbury is right that my successor as director of finance of the Labour Party has dramatically improved its financial situation: the Labour Party is effectively debt-free these days. At the same time, we have had a few other challenges, which have been widely reported in the media. However, as the right reverend Prelate said, political parties are an important part of our national life. We need them to be healthy and functioning.

I would be very happy to end the policy development grants if other measures in the Bill were enacted. Part 2 concerns the control of expenditure for political parties. I understand the intention behind that, but I am not sure if it is the correct way forward. Like it or not, different parties will be able to raise different amounts of money. I suppose that has some correlation to their support in the country, the wealth of their donors and other factors. Often, the Conservative Party seems able to raise more money than other parties, although not always. I am not sure we should be too prescriptive; if we raise money legally, from permissible sources, outside an election, we should be able to make use of that money within legal means. It is not one party’s fault if it raises more money than another.

We should look at how money on things such as the freepost could be used more effectively. For example, the system of using booklets for election addresses has been in place for mayoral elections for many years. I have no real problem with that. Leaflets generally have less effect in elections, in much the same way as we have declining newspaper circulation. They can no longer claim that they were the ones what won it. The Bill’s focus should be directed much more towards the internet, adverts on various platforms and the use of and the manipulation of data, as many noble Lords referred to, and what is and is not acceptable in that regard.

I thank the noble Lord, Lord Tyler, for bringing the Bill forward. It is a timely piece of legislation. I do not agree with it all, but as I said, in many respects it enables us to have a positive debate and discuss these issues, which the Government will have to return to sometime in this Parliament.

My Lords, I am grateful to the noble Lord, Lord Tyler, for the opportunity to discuss these important issues and to all noble Lords who have spoken in today’s debate, who have experience of fighting and funding elections and being involved in the electoral process. I commend his tireless energy in seeking to reform and improve the democratic process in this country. I have enjoyed working with him on these issues over many years, particularly when we were both in opposition and therefore operating under fewer constraints. Like other noble Lords, I have reread our proceedings from 10 March. I particularly liked the last line:

“House adjourned at 1.04 pm”.—[Official Report, 10/3/17; col. 1624.]

The noble Lord has raised the issue of party funding and expenditure a number of times in recent years and it is right to return to this subject. Many unresolved matters have been touched on during the debate. The rules on both the funding and expenditure of political parties are set out in the Political Parties, Elections and Referendums Act 2000. Both of us took an interest in that legislation in another place. Despite several attempts at reform no agreement has so far been reached on substantial changes to that system. I agree that it would be unusual to have major constitutional change introduced by a Private Member’s Bill.

There are two elements to the Bill: reforming the funding of political parties, and reforming the balance of spending of political parties and candidates at elections. Both of these are complex issues and the Bill proposes significant structural changes.

Party funding is an issue we have returned to many times in recent years. Since the current system was established by the PPER Act 2000 there have been several attempts at reform. Indeed, party funding has been the subject of talks for a decade. Examples of proposals for reform include the plans put forward by Sir Hayden Phillips in 2007 and the Committee on Standards in Public Life in 2011.

In 2012 and 2013, wide-ranging cross-party talks were held with representatives to discuss many of the issues raised today and which appear in the Bill. Unfortunately, as on previous occasions, the political parties were unable to reach a consensus and all the obstacles faced in those talks have not gone away. As has been obvious from our debate and from what my noble friend Lord True and the noble Lords, Lord Whitty and Lord Kennedy, said, there is still a lack of agreement on some of the key elements in the Bill. I agree with the noble Lord, Lord Kennedy: it would not be appropriate for the Government to impose major changes on political parties without cross-party consent. It is in everyone’s interest that the democratic process should continue for the moment to be funded in the way it is. We should not undermine the democratic process unless we are absolutely confident that there is a better way of funding in the future.

I am anxious to make progress with the noble Lord, Lord Tyler, so I met him in September to discuss particular clauses of the Bill where he felt progress could be made. He was good enough to recognise that the Bill as a whole was ambitious, but he hoped there might be some common ground. One subject he raised fell within the broad subject of party funding but was relatively self-contained and is found in Clauses 10 to 14, some of which the noble Lord, Lord Kennedy, just referred to on gift aid, tax relief and the rest. The Bill suggests replacing the delivery, at public expense, of one candidate’s election address leaflet to each elector or household with the provision of a single booklet for each constituency, to be produced by the returning officer, as part of the way of funding some of the elements in that clause. He also suggested the abolition of policy development grants as a further means of funding those clauses.

Following our meeting, I made some inquiries to see whether this was practicable. A booklet system already exists for the limited number of mayoral elections that have taken place, as the noble Lord, Lord Kennedy, mentioned, but there would be several complexities in introducing booklets for constituencies at general elections, not least the volume and number of different versions to be produced. Returning officers who cover several constituencies would need to manage the production and printing of booklets for each constituency, which would place significant additional pressures on them and their print suppliers at the time they are most busy printing ballot papers. Furthermore, political parties on all sides may have reservations at being tied to set timetables for the production and delivery of these booklets. At the moment, for example, parties can arrange for different members of the same household to get the election address on different dates; that flexibility would be lost.

There is also no certainty that moving to a booklet system would lead to an overall cost saving to the public purse. At present, while the postage costs for the delivery of one leaflet to each elector or household per candidate are funded by the state, the candidates and parties pay for their production. The Bill suggests that returning officers would manage the production of booklets, with candidates asked for a contribution towards the costs. While the aim may be for candidates to fully fund these booklets, in practice this is not what happens for the existing booklets at mayoral elections. In some cases, only a nominal amount is requested from candidates. It is possible that any savings to the taxpayer made by reducing postage costs could be offset by the production of the new booklets. The noble Lord may wish to reflect on those points and refine his proposals to take them into account.

The other source of money to fund those clauses was the abolition of policy development grants. These total about £2 million and help political parties develop proposals for their manifestos. I think there is a public interest in having credible, well-founded manifestos. If the grant were abolished, and the sum redistributed in the way the noble Lord suggests, it is not clear that there would be much difference in the relative distribution of those funds. Unless viable ways of funding the new schemes for supporting political parties set out in the Bill can be identified, they would all involve an additional cost to the taxpayer. I think the noble Lord has conceded, as the former Deputy Prime Minister Nick Clegg said, that,

“the case cannot be made for greater state funding of political parties at a time when budgets are being squeezed and economic recovery remains the highest priority”.—[Official Report, Commons, 23/11/11; col. 25WS.]

We also discussed the noble Lord’s proposals for varying the relative amounts of central party local candidate expenditure, something mentioned by the noble Lord, Lord Rennard, and others. On the subject of campaign spending, as noble Lords will know there are separate systems governing the spending of political parties on one hand and candidates on the other. This is another complex area that the Bill seeks to reform. There have been several recent examples of political parties being sanctioned by the Electoral Commission over their campaign spending. A case concerning candidate spending is also currently before the courts. Ensuring that the system operates effectively and is well understood is important for all of us—I agree with the noble Lord on that. Once all the cases are concluded, the Government can make a rational assessment of the effectiveness of the current legislation on election spending, as well as taking on board the many points that have been made in our debate this afternoon. The issue may be more one of timing than one of principle.

Reducing the spending limits of political parties and increasing those of candidates, as the Bill suggests, would not of itself necessarily deal with all the problems that have so far occurred. Any consideration of shortfalls in the current system would also need to look at other issues not mentioned in our debate, such as whether there is currently sufficient time for political parties to make accurate spending returns.

I mention in passing that one area not mentioned in our debate or in the debate in March is the abuse of candidates, an issue that the Government are seeking to address. It is important to our democratic process that no one is deterred from standing for office due to the fear of suffering abuse and intimidation. That is why the Prime Minister asked the Committee on Standards in Public Life to undertake a review of the intimidation of parliamentary candidates. The independent committee is considering the protections and measures in place for candidates and has gathered evidence, through a call for evidence and oral evidence sessions with the police, the Crown Prosecution Service and the political parties. A report of the recommendations to further tackle the issue will be provided by the committee to the Prime Minister in December.

I turn to some of the issues raised in the debate. I am grateful to my noble friend Lord True, who I think suggested that there should be some restriction on the ability to reintroduce in a subsequent Session a Private Member’s Bill introduced in a previous one. He said that this might save the noble Lord, Lord Kennedy, and myself from repetitive stress. I see some advantage in that; on the other hand, if I have to spend a Friday here I would rather spend it redoing a Bill on which I already knew something than having to tackle one from scratch. My noble friend was concerned with two issues. As I said in March, we are considering the issue of the donation he referred to alongside a number of others related to donation matters, although one would have to reflect on whether any legislation would be retrospective. Likewise, we need to reflect further on the issue with the Green Party. I endorse what the noble Lord, Lord Kennedy, said about my noble friend’s contribution to local government and we look forward to his contributions to the House.

The noble Lords, Lord Wrigglesworth and Lord Whitty, raised the very important issue of social media, which has added a new dimension to our campaigning. It simply was not there when the legislation was introduced and we need to ensure that the legislation is fit for purpose. At the moment, any spending on social media will generally be subject to existing spending limits and reportable after the poll. It will normally be reported under the categories of advertising or unsolicited campaign material, but the Electoral Commission is actively considering how the regulatory framework should adapt to the use of social media by political parties.

The right reverend Prelate the Bishop of Salisbury added a spiritual dimension to our discussions and quoted from Prayers. I have often wondered whether, if there was something offensive to the Church on the Order Paper, the Bishop who took Prayers could simply run through the psalm book at the beginning of our proceedings so that we would never actually sit. I wonder what the Whip on the Bench would do if those ingenious tactics were ever used. The right reverend Prelate mentioned expenditure by the main parties. Expenditure at elections by my party has gone down for each of the last three elections; the less we have spent, the better we seem to have done. In 2015, we spent £15.6 million and the Labour Party spent £12.2 million, so we were ahead but there was not a huge difference. I take very much what he said about good will. We will need good will from all sides if we are to make progress on this issue.

The noble Lord, Lord Kennedy, asked me about updating some of the limits in the PPER Act. Section 155 allows the Secretary of State to update certain figures using secondary legislation and to do so by inflation. The question of using the Moses Room for Committee stage of a Private Member’s Bill is something to be discussed through the usual channels.

On Northern Ireland, progress has been made. We believe in the importance of transparency to the political process, and in line with that aim, the Secretary of State intends to bring secondary legislation before Parliament that would provide for the publication of all donations and loans received by Northern Ireland parties. That would take effect in respect of donations and loans received on or after 1 July 2017. The order is at an advanced stage of drafting and we hope to lay it before Parliament very soon.

Reaching agreement on the areas raised in the Bill will be complex. Political parties have wide-ranging views and finally achieving consensus on this subject will not be an easy task. Investing significant time in cross-party talks and—even in the unlikely event that consensus could be reached—finding time in the legislative agenda to make complex changes to the system cannot be a priority. The legislative programme for this Session is already at full capacity and there is no scope for additional measures.

That is not to say that the Government do not take electoral issues seriously. We continue to consider issues as they arise and make appropriate and proportionate changes. Rather than embarking on another attempt at root-and-branch reform, we are identifying small ways in which the existing system can be improved—I have just referred to the question of Northern Ireland. When he appeared before the Constitution Committee in March this year, the Minister for the Constitution said that the Government would be open to considering small-scale measures in relation to party funding, such as looking at charitable payments and the changing role of technology. I am happy to repeat to the noble Lord the offer of a meeting that was made last time we spoke. I think one had been arranged, but it was disrupted by the general election.

However, as we have heard this afternoon, wholescale reform of the party funding and campaign spending regime does not currently have cross-party backing. Without consensus on these fundamental issues, it is only right for me to say that the Government have reservations on a Bill on such matters at this time.

My Lords, I am extremely grateful to a number of noble Lords who have come again on a Friday. I am afraid we have taken rather longer than on the previous occasion, but I am full of pride for the way in which we have been able as a House to look at these issues on a consensual basis, if I may again use that word. I was particularly delighted that the right reverend Prelate the Bishop of Salisbury referred to partial affections. I have always loved that phrase, and I have always wanted to work it into a speech in the House in some way, but he has gazumped me. If my wife is still listening to this debate—she is very patient—I should make it clear that as far as I am concerned some partial affections are still entirely acceptable.

It is extremely important that we pick up one of the last points made by the Minister. Politics is a reputable pursuit. I know on a number of occasions we may find it difficult to persuade the media of this, and on the whole the public sometimes have difficulty with it, not in relation to individuals, on the whole, but as a collective. Therefore, as the noble Lord, Lord Kennedy, and the Minister said, there is a very considerable case for looking again at small contributions to political parties being treated in a similar way to making contributions to charities. That would be a small sign that public life is a reputable pursuit in this country. Politics is not just a dirty game. I will come back to that point in a minute.

I am grateful to the Minister for repeating his agreement that we should have some more discussions about what could be incremental and what consensus there may be. As my noble friends Lord Whitty—he is my noble friend in this context—and Lord Wrigglesworth said, it was a very firm commitment in the discussions arising from the Select Committee on Trade Union Political Funds and Political Party Funding that the Government should look at that again, and the House endorsed that very strongly. Therefore, although a general election has intervened, I hope that that will still happen because I think we can make some progress.

On a couple of points of detail, I have not, my Bill does not and the proposals that have come forward from the Committee on Standards in Public Life have never said that there is one absolutely clear way forward. What we have said is, for goodness’ sake, let us look to see whether there is some way forward. I illustrate this with a point about the Royal Mail. I am told that the distribution of election addresses in June this year cost the state £42 million. There is an illusion out there which is shared by the Daily Mail and some other ignorant parts of the media that somehow or other there is no state funding of politics in this country, but £42 million is a lot of money. If you add to that the £100 million or thereabouts that the Government spend each year promoting their policies, not all above the threshold of impartiality that I was referring to just now, that is a lot of money too. It is important that we should make clear that none of us has suggested a huge increase in demand upon the taxpayer. We are just saying that we should try to make sure that taxpayers’ money is spent more wisely and in a way that they would accept.

That is where I very much agree with the Minister about the role of the Electoral Commission. I think the powers of the Electoral Commission should be strengthened. It is one of the specific issues that I have put in the Bill, and it has received a great deal of support in the past.

I return to the point about the reputation of politicians and politics. As the Minister said, the Committee on Standards in Public Life—I regret that the noble Lord, Lord Bew, is not in his place because he might have been able to refer to exactly where it has got to—has been asked by the Government to look at the intimidation of candidates and those active in our public life. I welcome that as extremely valuable. That inquiry into the extent of abuse this year and, I think, during the referendum is very important.

Although I welcomed the rather repetitive, if I may say so, contribution of the noble Lord, Lord True, I am disappointed that he did not take the opportunity today to apologise for the outrageous, abusive attacks by supporters of Zac Goldsmith on the former Member for Richmond Park. But that is a footnote. In the meantime, I seek the Second Reading of the Bill.

Bill read a second time and committed to a Committee of the Whole House.

House adjourned at 3 pm.