Electoral Administration Bill

I am not sure that it is entirely right to say that we have not done so already. I accept that we have not put our proposals together in the way in which the hon. Gentleman has done, for which I commend him. However, I hope that he acknowledges that his proposal on a £50,000 cap has been our policy for some time. We have been clear about the need for both that and transparent reporting. I have made speeches in which I have made our broad attitude clear. We will be giving evidence and working with others in the context of Sir Hayden Phillips’s review, and I hope that we will be able to reach a consensus. However, I foresee that there will be difficulties due to the differing perspectives and sources of income of the parties represented in the House. Some difficulties may be reconcilable, but perhaps some will be irreconcilable. We should strive seriously to try to find a consensus because if we do not, the whole of our political and democratic process will be cheapened by our lack of ability to find a common view. There is merit in the proposals on the reporting and admissibility of loans. I wish that such provisions had been in place some time ago. It would have been better if we had realised the possibility of adopting them at the time at which the Political Parties, Elections and Referendums Act 2000 was passed, but it is easy to be wise after the event and not to realise the ingenuity of those who wish to circumvent any system that is put in place. I am especially grateful to the Minister for acknowledging the strength of an argument put forward by Lord Goodhart in another place. He made the point that cumulative payments could be part loan and part donation, and that several separate loans, or a mixture of loans and payments, could reach the threshold. The Government tabled appropriate amendments to take account of that. I am also grateful to the Minister for explaining capitalisation in relatively simple terms and outlining her proposals in that respect. I know that her colleague in the other place struggled to make sense of the proposals, but I think that we understand what is being suggested. The Minister will know that we disagree with the Government on one aspect of the proposals, although we have not tabled amendments to reflect that at this stage because reaching consensus is more important than getting absolutely everything. However, there is a strange anomaly that if a loan is made before the commencement of the relevant part of the Bill by a donor who proves to be non-permissible, it will be allowed to be maintained as a loan, despite the fact that if it had been made after the commencement, it would be unlawful. In such circumstances, it would be appropriate not to criminalise the loan and retrospectively make unlawful something that was quite lawful, but to require the loan to be repaid after an appropriate period of time so that the situation could be regularised. Such an approach would be logical and consistent with what the Minister said would happen if a loan was taken in good faith after the commencement of the legislation, but it was proved, after further reflection, that the donor was non-permissible. In such circumstances, the loan would have to be returned—there is no suggestion that that should not be the case—so, to put it mildly, there is a certain lack of logic behind the Government’s proposals. As far as we are aware, from the evidence that we have been given, there would not be a significant quantity of outstanding loans. Of course, a party would be able to make a full repayment before the commencement of the provisions, so even reporting would not be necessary because the matter would become a closed book. Some parties will wish to take advantage of that ability in respect of donations that come from overseas sources, while others will not have such loans to report. Others might take the view that they would have to make the identity of the donor public under the requirements of the legislation if the loan was still outstanding, at which point they could maintain the loan, and that would be an equally satisfactory outcome in terms of transparency. However, a difficulty would arise if the identity of a donor became known and it was quite clear that that person should not have made a donation under the terms of the Bill. I do not understand the Government’s position on the matter. They should have thought again, but I acknowledge that when we made such points in another place, two parties did not agree with our position. They might have had their reasons for doing so, although I do not think that those reasons were based on logic, but I accept that as we were unlikely to secure a majority in the other place, we were certainly not going to secure a majority here, which is I why I have not tabled amendments on the matter today.