Political Parties and Elections Bill

I am glad that we have an opportunity to discuss the crucial issue of the role, if any, of donation caps in a properly transparent system of party funding that commands the greatest degree of public acceptability. This issue was first considered at great length by the Committee on Standards in Public Life, which examined it in 1997, after the general election of that year; and in its landmark report of 1998, under its then chairman, Lord Neill, it set out its view of the case for and against donation caps, because—surprise, surprise!—the Liberal Democrats were at that time urging on the Neill committee donation caps of £50,000. At least on this occasion, therefore, the Liberal Democrats have the benefit of consistency on their side. That is an accusation that can rarely be made against them, but I do so today, although it also suggests that they might have been somewhat immune to experience in the meantime. The Neill report placed the burden of its recommendations on the crucial issue of transparency. On that issue, the hon. Member for Cambridge (David Howarth) made a very bad point for himself, but a good point for the rest of us, when he referred—in rather delphic terms, but we might as well refer to it publicly—to the Ecclestone donation to the Labour party, which emerged, with a certain amount of excitement, in the autumn of 1997. That donation was made under the old regime—the untransparent regime—whereby donors were entitled to request confidentiality for their donation, and I recollect, although I am open to correction, that that is what happened. The profound change made by the Political Parties, Elections and Referendums Act 2000 was that that donation, which was well above the £5,000 limit, would have had to be on the record and be declared by the Labour party. People could then have made up their own minds about whether undue influence was being brought to bear. If the purpose of giving the money was, as it were, to purchase a policy, the donor might well have decided that, as there would be total transparency, it might not be such a good idea. I am pretty certain that none of the problems that arose would have arisen had the provisions of the 2000 Act been in force in 1997. Therefore, this is a point for those of us who believe above all in transparency, and in doing nothing that might undermine a transparent regime. Neill considered the whole issue of transparency and donation caps. He was very clear about the need for transparency and the caps, which have broadly stood the test of time, notwithstanding the fact that we and the Opposition accept that the limits must be increased. The committee came down against a donation cap, however, and I ask the House to weigh its words with great care:""The individual or company wanting to give might consider that the cap infringed a basic right and there would be a strong temptation to seek to evade the limit, perhaps by spreading resources amongst friends and relations or by setting up subsidiary companies in order to legitimise any donation by sub-dividing it. There would be no easy way to detect such a stratagem, nor to enforce the cap. In our view, the panoply of rules and bureaucracy which we believe would be required to enforce such a system would not be justified by the purpose of the cap"."