HC Deb 21 July 1960 vol 627 cc733-803

3.46 p.m.

Mr. Gordon Walker (Smethwick)

I beg to move, to leave out from "That" to the end of the Question and to add instead thereof: this House calls upon Her Majesty's Government to set un an inquiry into the control of political expenditure. The mainspring of our Amendment is our conviction that recent developments have called into question the efficacy of our law to control political expenditure during elections. The first thing to do is to establish that there is nothing new in adjusting our electoral law to changing electoral facts in this field. Indeed, it has been a long and constant process. The first modern Act, in the sense of an Act based on the idea that it was proper to limit the "power of the purse" in elections, was in 1883, namely, the Corrupt and Illegal Practices Act. That was the first time that candidates' expenditure was limited by law.

That worked quite well for a fair time, until about the turn of the century, when a number of large outside bodies found a way of getting round the law and spending money in election campaigns. They were bodies like the Anti-Corn Law Society, the Licensed Victuallers' Association, and the Liberal-Unionist Association. This caused very great concern when it was found to be happening, and Parliament was then faced with essentially the same problem that we are now faced with, namely, how to stop such abuses of the law without infringing freedom of expression.

A Speaker's Conference was called in 1916 to consider this matter, and it unanimously came to the conclusion that the incursion into elections by outside bodies was a contravention of the spirit of the law. In effect, it concluded that, if one sets out to control candidates' expenditure, one has to control outside expenditure as well, otherwise one makes nonsense of the law. This was carried into operation in the Representation of the People Act, 1918, which limited and controlled all expenditure on behalf of a candidate in a constituency during an election. It was carried further in 1948, and finally consolidated in Section 63 of the Representation of the People Act, 1949.

Mr. D. E. Butler and Mr. Richard Rose, in their book The British General Election of 1959, to which I shall have occasion to refer once or twice, described this final consolidation of the law in Section 63 as a … summary of the laws by which the gross abuses of Victorian Electioneering were cleaned up. Our contention is that similar abuses are now reappearing in political life. I want to emphasise that it is not a new problem we are dealing with, but an old problem in a new form, and one which Parliament has in the past shown itself capable of tackling and solving.

It is not only for this reason that the law needs to be looked at again and inquired into. There are a number of aspects in which the electoral law has shown itself to have defects. We ought to inquire into whether the same exemptions that are extended to the Press against the full rigours of our law ought to be extended to broadcasting and television. The law there is certainly in a terrible state of confusion. There is also the question whether the postal vote ought to be extended to people on holiday and, perhaps even more important, to people who, while moving from a constituency, still remain within the boundary of the same city and are not at the moment entitled to the postal vote. No doubt other hon. Members will think of many other ways in which the law has shown itself to be defective.

The main ground for inquiry, however, is that now factors have called in question the adequacy and relevance of our law to control political expenditure. A very important leading article in The Times of 9th June said: In so far as the law regulating election expenses is supposed to set a reasonable limit to the electioneering budgets of political parties so as to cancel the undue advantage of wealth, the law is obviously defective. That is a very grave thing, not only for us on this side but for The Times itself to say—that the law is obviously defective in one of its main purposes.

One reason for The Times' view that the law is defective was the Tronoh Mines case, heard in 1952. I have read the entire transcript of that case, which I have here. I do not know whether the right hon. Gentleman the Home Secretary has read it. If not, I hope that he will, because it makes very disturbing reading to anyone concerned with maintaining the integrity of the law in this connection.

What happened in that case was that, in the middle of the election campaign, the Tronoh Mines Company put an advertisement in The Times and in other newspapers openly calling for votes against the Labour Party. The company was prosecuted under Section 63 of the 1949 Act and the judge ruled that there was no case to go to the jury. As I understand it, the clear implication of that judgment—and I do not know whether the right hon. Gentleman would contest this—was that any advertisement by a central party or an outside body that was clearly calling for support of or opposition to a political party in the middle of an election campaign was legal so long as it made no mention of an individual, specific candidate.

This is a very alarming state of affairs. It means that the safeguards that we thought we had under Section 63, which would prevent an incursion of outside bodies into an election campaign during an election, are really illusory, and the Tronoh Mines case, and the doubt into which it has thrown the law, is itself and alone an unanswerable argument for an inquiry of the kind for which we are asking.

There are more fundamental reasons for such an inquiry. The law has now been called into question as a result of the actions of the present Administration. The Prime Minister, his chief colleagues, the big business interests behind them, have ruthlessly and cynically explored and exploited loopholes in the law, in order to get round it. While keeping within the letter of the law, they have come perilously near to killing its spirit.

The story told by Mr. Butler and Mr. Rose starts with the accession of the Prime Minister, which opened a new chapter in our electoral law. At the time of the resignation of Sir Anthony Eden the fortunes of the party opposite were at a low ebb, and the Prime Minister's two main remedies were to call the Chancellor of the Duchy of Lancaster into the Cabinet to look after the public relations of the Government, and to call Colman Prentis and Varley into the inner circles of the Conservative Party machine.

Colman Prentis and Varley have been very coy in this country. They have even written letters to The Times suggesting that they have nothing whatever to do with politics or with putting over the views of the Conservative Party. Abroad, however, they have been rather less reticent. I have here a photostat of an advertisement that appeared in the New York Times on 12th January, 1960. It reads: Ads like this are what C.P.V. is doing for clients all over the world. "Clients" is the word used. And the prize exhibit, the thing that they are most proud of is that famous advertisement of the family washing a car, with the caption: Life's better with the Conservatives. Don't let Labour ruin it. It is the open admission—indeed, it is the boast of Colman Prentis and Varley that they are responsible for the whole thing. The slogan, the layout, the whole idea is thought up by Colman Prentis and Varley in the same way as they sell other commodities. Indeed, that advertisement comes exactly over another one of which they are apparently also very proud—an advertisement for Pepsi-Cola. They treat those, it is perfectly obvious, as being in the same category one with another. They regard the Conservative Party as a commodity, just like a soft drink or a detergent to be sold. What is even worse is that the Conservative Party allows itself to be so treated by Colman Prentis and Varley.

The Conservatives, having called in Messrs. Colman Prentis and Varley, planned, and in June, 1957, launched, a tremendous public relations campaign. In the 27 months up to the General Election the Conservative Party spent £468,000 on this public relations campaign. During the six weeks just before the election, the Conservative Party actually became the biggest single advertiser in the country, leaving behind the brewers, the detergent makers and all the rest. In that period, the Conservatives spent five times the total that the Labour Party was able to afford on public relations of all kinds.

But this vast expenditure was put in the shade by what Mr. Butler and Mr. Rose call "politically relevant expenditure" by outside commercial interests on behalf of the Conservative Party. These authors use a very strict and narrow definition of what they mean by "politically relevant expenditure". They consider only, in their own words: Activities of business groups which may have had a direct influence on the outcome of the 1959 election. They exclude very much that a fair-minded observer might have included, such as the prestige advertising by the Steel Company of Wales, or by Guest, Keen and Nettlefolds which, as they say, was … in evidence shortly before the election. These things, which could have been included, were excluded. The authors' estimates of expenditure were very scientifically and cautiously done by pricing the various advertisements at market prices. I am prepared to accept their very narrow and limited definition of expenditure. It strengthens my case to take very conservative figures.

There were two kinds of outside body that spent money on behalf of the Conservative Party. First, there were the "front" organisations. The Conservatives have a constellation of "front" organisations that is just as elaborate and transparent as that of the Communists. They are similar in that both claim that they have no political aims or affiliations. "Aims of Industry", which is one of them, is, perhaps, the most naïve. An article that appeared in Scope in September, 1959, based on material clearly provided by "Aims of Industry", said: It has tried as far as possible to steer clear of party politics—but this has not been easy. One of its most striking attempts to steer clear of party politics was, of course, the organisation of the "Mr. Cube" campaign.

This organisation is financed by 4,000 companies and trade organisations, and spent £107,000 before the election for electioneering purposes. The Institute of Directors, whose President is Lord Chandos—formerly Oliver Lyttelton—and which has among its members 100 Conservative Members of Parliament and 100 Conservative peers, spent £60,000 in this pre-election public relations campaign. The Economic League spent £208,000, and Mr. Hurry, on his anti-nationalisation campaign, spent £475,000.

The very nature and technique of these "front" organisations involves a continuous proliferation of new ones. I have recently come on the trail of a new, rather sinister and secret "front" organisation for the Conservative Party, which is very reluctant indeed to disclose what it is doing—[Interruption.] It may be that hon. Members opposite know better than I. It is called the United Industrialists Association Ltd., and its address is 140 Park Lane. It is known that before the election that Association sent personal letters to managing directors of selected firms asking for very large contributions, and I understand that it divided the money it got as to 90 per cent. to the Conservative Party, 5 per cent. to the National Liberals—a nice touch of old-fashioned courtesy—and 5 per cent. to "Aims of Industry."

This shows how closely all these interests are tied up, and it also shows how difficult "Aims of Industry" must find it to steer clear of party politics. Even those who think that this sort of expenditure is right surely cannot defend, at any rate in public, the idea that it should be as secret as all this. The right hon. Gentleman must know. He is the Chairman of the Conservative Party organisation. Ninety per cent. of the money raised must have come to a body that he controls. I hope that he will tell us, in the interests of decent public knowledge of these things, something about the United Industrialists Association Ltd.

Besides these "front" organisations, there is the direct expenditure on behalf of the Conservative Party by companies and trade associations. One or two examples are as follows. The Iron and Steel Federation spent £287,000 on politically relevant expenditure. Stewarts and Lloyds spent £269,000. If we total both these amounts together—that of the "front" organisations and the direct expenditure by companies and similar bodies—we get £1,435,000 that was spent in the period leading up to the election with the aim of influencing it. If we add to that the similar and simultaneous expenditure by the Conservative Party of £468,000, we get the absolutely extraordinary sum of £1,903,000 spent for electoral purposes. The recent election deserves to go down in history as the "cheque book election", the election in which the tie-up between the Conservative Party and big business was more naked and unashamed than ever before.

There is compelling evidence that this expenditure was, in aim and in effect, electoral—not just political in a general sense, but electoral. One only has to look at the timetable to be satisfied about this. The timetable of expenditure was closely parallel to that of the Conservative Party. As Mr. Butler and Mr. Rose say, these various bodies bought space with due regard to the calendar of politics. All of them started in the spring of 1959—all in a concerted way. They all reached the peak of their spending in August, 1959. As an example of this, in the months just before the election, "Aims of Industry" made available to firms anti-nationalisation pamphlets to be stuck into pay packets. This putting of political propaganda into pay packets always strikes me as the meanest, most underhand and dirtiest form of political propaganda. But it is known of by the Conservatives and it is used by the Conservatives.

Even more significant in a way than the co-ordinated beginning and reaching of the peak of expenditure was that it all ended together practically on the same day. As Mr. Butler and Mr. Rose say: Expenditure virtually came to an end when the Election was announced. In other words, so electoral was this work that these firms were worried that if they continued it into the election period proper, they would get into trouble with the law. Stewarts and Lloyds dropped their blatantly dishonest slogan, "It's not your vote we ask for, it's your voice", at the very moment when the soliciting of votes became the thing with which the law might concern itself.

The National Union of Manufacturers dropped its posters on the declaration of the election in case it should contravene the law, and the Conservative Party did just the same. We get exactly the same pattern between the Conservative Party and the outside bodies. The start, the peak and the end were absolutely parallel one to another.

There are some grave implications from all this which must arouse great anxiety. Should these expenses, for instance, be allowed against Income Tax? It is monstrous and pernicious that the whole body of taxpayers should be made to bear expenditure which is deliberately incurred in favour of one particular party.

Another implication which must disturb anyone who is concerned with the decency of our democratic life is that it brings a new and unsavoury element into it—namely, that of the pay-off—of the reward for all this outlay. The rewards have been fabulous. On Monday, my right hon. Friend the Member for Leeds, South (Mr. Gaitskell) told us something about the vast increase in land values 'as a direct result of the Conservative victory. The increase in share values was almost more startling. On the very day after the election, on the very first day, share values rose by £850 million. By 28th October they had risen by £1,150 million. That was the return on an outlay of £1,435,000.

Because of the blind and obstinate policy of Her Majesty's Government, all this is tax free—all these capital gains. It is a very convenient arrangement. The outlay is set off against tax, and the pay-off itself is tax free. Indeed, as Mr. Butler and Mr. Rose said in a masterpiece of understatement: The sponsors of the campaigns appeared satisfied with their efforts.

Mr. Denzil Freeth (Basingstoke)

Would the right hon. Gentleman explain how the Government engineered this large rise on the Stock Exchange?

Mr. Gordon Walker

In much the same way they engineered the increase in land values, and partly because it was perfectly clear that if the Conservatives won there would not be a capital gains tax. This was one direct way in which it was done.

I think that the gravest implication of this sort of thing that has been happening, this vast expenditure by the Conservative Party and by outside bodies—and this is really where a very serious point arises—is that it has destroyed some of the basic assumptions on which our law is based for controlling political expenditure. One of these assumptions is that a General Election is nothing but the aggregate of all the constituency contests, and that, therefore, if one wants to control expenditure, to limit the power of the purse in politics, all one need do is control these actual constituency contests.

The extent to which this assumption has been destroyed can be arithmetically demonstrated. Central parties today are far more important units in a General Election than constituency parties. This is true of both parties, but it is particularly true of the Conservatives. The sum that the Conservative Party, alone as a party, spent on public relations in the two years before the election equalled the total of all the expenditure by all Conservative candidates during the election. The Conservative Party centrally spent £468,000. All the Conservative candidates spent £470,000.

Secondly, the experience of this election has shown that outside expenditure has become infinitely the most decisive factor in the outcome of an election. The Conservative Party's expenditure on public relations, plus this outside expenditure, comes to £1,903,000. That is £850,000 more than the total expenditure by all candidates of all parties during the election. This shows that the central party, the outside expenditure, is now the decisive thing and that it is not enough for the law, as it has been in the past, to assume that all one need worry about are the constituency contests.

The second assumption of the law is that an election will lead to an increase of expenditure on propaganda. The whole basis of the law is that one wants to restrain an outburst of expenditure. But so great was the expenditure both by the Conservative Party and by these outside bodies that, for the first time in our history, the declaration of the election led to a reduction in political expenditure. This also shows how irrelevant these basic assumptions of the law have now become. What has happened is that once again, as at the turn of the century, rich men, now advised by clever people like Colman Prentis and Varley, have found a way of riding roughshod over the whole intent and purpose of the law.

The problem is so grave that anyone who is concerned about the maintenance of democracy must try to find a remedy. There are several partial remedies, all of which should be looked into. The first arises from the urgent necessity to clarify the law after the Tronoh Mines case. The second partial remedy would be for the Conservative Party to adopt the normal political practice of publishing its accounts. The need to do this is really all the greater now that the central parties have become the really decisive factor in election contests.

I am sure that many hon. Members opposite must be somewhat troubled in their conscience—[HON. MEMBERS: "Oh."] I should not like to believe that there were not Conservatives who were troubled about the suggestive secrecy in which the finances of their party are shrouded. I hope that they will help to make their party "come clean" and play the game according to democratic rules.

Another partial remedy I wish to suggest is that the same sort of controls over political expenditure that now apply to the trade unions ought to be applied also to companies. Both kinds of body now expend part of their members' or their shareholders' moneys for political purposes. It would be manifestly unjust if they continued to be treated quite differently by the law when they really are now competing in the same field. "Political purpose" could be defined for companies in the same broad terms as one finds in the Trade Union Act, 1913. It could be said that all political expenditure should come out of a political fund, as in the case of trade unions.

Before a political fund is set up, as in the trade unions, there would have to be a resolution of the shareholders and then, as in the trade unions, a ballot of the members. Then, if the proposal were carried, prominence would have to be given to the right of shareholders to contract out and, of course, to receive an appropriate remission, presumably, in the form of increased dividend. [Laughter.] I suggest to hon. Members opposite that they must do one or the other of two things to put these bodies on the same footing; they should either abolish the control of political expenditure by trade unions, or apply the same rules to companies.

The most difficult problem, the fundamental problem, arises from the fact that the combination of Conservative Party public relations expenditure and expenditure by the outside bodies has really undermined the central assumption on which our present law rests, that is to say, that it is enough for the law to control expenditure during the course of an election campaign to achieve the desired end. The fact is that the effective period of electioneering has now been enormously lengthened. This was clearly said by The Times in its leading article of 9th June: … It is by now a maxim of political strategy that to win an election a party should get to work on the electorate months or years before the election takes place. All of us know that that is a fact, and we all know that it is a fact which is ignored by the law. We really must try to find a way of bringing the law once again, as was done in 1918, when this sort of problem had to be faced, into accord with the known political facts.

The question we have to consider is whether it would be right to extend the control of the law backwards somewhat in time before the beginning of the actual election campaign. This does raise very serious and difficult problems, problems which ought to be considered above party, with the intention of trying to find a solution. It is essentially the same problem as that to which the Speaker's Conference of 1916 found a solution.

The argument against doing this has been set out very fairly in the book by Messrs. Butler and Rose. They say: Much greater ethical and practical problems are involved if restrictions against pre-campaign activities are considered and they go on to say that Great hesitation should be felt about placing any restraint on the freedom to advocate ideas". On the other hand, the same authors say that, if nothing is done, the law will become a dead letter, adding that: The law does not recognise some of the fundamental facts of politics in the second half of the twentieth century … It would be possible to make nonsense of the present limitations by intensive pre-campaign expenditure.

Mr. Peter Kirk (Gravesend)

There is an important point here. One simply does not know sometimes when an election is to be held. Could the right hon. Gentleman deal with that?

Mr. Gordon Walker

It was surprising how well the outside bodies were able to plan their expenditure. Nevertheless, I agree that there are problems here. I do not conceal them. This is why we want an inquiry. We do not say that the matter should be settled on the basis of one debate. We want an inquiry, and it is this sort of matter which ought to be examined.

There are several considerations to be weighed. One is that the control of pre-campaign expenditure is not altogether new in our electoral law. It is to some extent provided for by Section 103 of the 1949 Act. Secondly, the law has always drawn a distinction between freedom of expression and freedom of expenditure in putting across views with the intention to influence elections. Indeed, if one did not make this distinction between expenditure to put across views and freedom of expression, one could not control these matters at all. Our existing law makes the distinction, and there would be no new principle involved if we distinguished between what one can call the freedom of expression and the fredom to buy space. This was exactly the sort of problem which the Speaker's Conference of 1916 had to consider.

The decisive case for an inquiry is that there is here a real problem, a problem which we should ponder carefully before attempting to embark upon a solution. It is that sort of problem which ought to be inquired into in the way it was at the end of the First World War. Messrs. Butler and Rose come to just this conclusion after their very balanced consideration, saying: The necessity for legislation has still to be proved. The case for an examination of the situation seems overwhelming. That is what we say.

The Times, in its article of 9th June, came to a rather grim and depressing conclusion. It said: If history is any guide, it would not be before an embryonic abuse had grown into a notorious scandal that the Legislature would be moved to act. The Times thinks that we are heading for a notorious scandal. Many of us think that we are already at that stage. I do not believe that the right hon. Gentleman the Home Secretary would want to wait until a notorious scandal arose before any action was taken. We demand an inquiry because we wish to prevent and forestall the notorious scandal which is already beginning to come upon us, and which, if unchecked, will unquestionably weaken our democratic system—there is already a great deal of cynicism resulting from what has happened, and this will become greater if things continue as they are—and, more important still, perhaps, jeopardise the standing of our democratic system in the eyes of the world.

4.19 p.m.

Sir Toby Low (Blackpool, North)

I shall try to answer the case put by the right hon. Member for Smethwick (Mr. Gordon Walker) in part of the spirit in which he advanced it. I shall try not to show the hatred for some aspects of our life which he showed. I agree with the right hon. Gentleman that this is an important matter, because the health of our political system is a serious matter for all of us on whichever side of the House we sit and whatever view we may take about party politics.

It is certainly true that some of the arguments which have been advanced in advocating either control of political expenditure between election campaigns or an inquiry into the matter are, at first sight, seemingly attractive. If the right hon. Gentleman and the House will bear with me, I will examine those arguments and their consequences rather closely. The right hon. Gentleman talked about decency in political life and in political battles. I am sure that he will agree that hon. Members on this side of the House attach just as much importance to decency in political life as do hon. Members opposite.

The right hon. Gentleman covered some matters to which I shall not refer. I will refer only in passing to the Representation of the People Act and the Tronoh Mines case. I shall concentrate on the wider case that he put before us, and the point that emerges from the Butler and Rose book. If hon. Members follow some of the points made by the right hon. Gentleman to their logical conclusions a number of things will become apparent. First, the result for the Labour Party is very different from what it seems to imagine and, secondly—and much more important—some of the implications for our way of life are either very serious, because they threaten vital freedoms, or are farcical because of their curious consequences.

The case for an inquiry can be treated separately from the case for control. I shall deal with the case for control, because if that case falls flat, so does the case for an inquiry. [Interruption.] Hon. Members know me well enough to realise that I am not asking them to take what I say simply because I say it; I am merely asking them to listen to what I say, and I hope that they will listen with open and unprejudiced ears.

The first thing we must do is to consider the mischief which it is sought to prevent by controlling political expenditure. I shall define what that is later. I think that we would all admit that there is no allegation of bribery or corruption of the electorate. No such allegation was made by anybody, including the right hon. Gentleman. Nor is it claimed—as it was in the eighteenth and nineteenth centuries, when the law concerning elections was tightened up—that our present law allows behaviour that might lead to breaches of the peace. Thus, the two main points which led to the passing of the Representation of the People Act do not apply here.

In that Act the mischief is clear, and so is the test of what is to be controlled, namely, election expenditure. This expenditure is controlled if it is incurred in advancing a particular candidature in a particular constituency in respect of an election in prospect. That is why I do not agree with the right hon. Gentleman when he argued that the position today in relation to expenditure between election campaigns is the same as that which was discussed in the 1916 Speaker's Conference.

There is the very important difference that what we are considering here is something much vaguer. There is no precise mischief. There is a vague feeling that there may be a great unfairness if one political party can arrange more, and more effective, political activity than another. This feeling is not confined to the two parties opposite; there is a feeling among Conservatives, which is just as strong, that the Labour Party is helped in that way.

Mr. F. Blackburn (Stalybridge and Hyde)

Let us have an inquiry.

Sir T. Low

If hon. Members will wait until I have proceeded further, and listen to what I say, they will save their time.

Let us consider the figures which the right hon. Gentleman quoted from the Butler and Rose book. I will take, first, the figures concerning the Conservative Party and turn later to the £1½ million or so in respect of industrial organisations. The figure of £450,000 in respect of the Conservative Party refers to selected expenses, such as Press advertising, posters and, as in the case of the Labour Party, "glossies". Let us suppose that the figures are not wildly wrong for either party. I cannot answer for either of them exactly. For the Conservative Party we get an annual average of £200,000, and for the Labour Party an average of £100,000. I wonder whether it is not pure humbug to say that the Labour Party could not have afforded £200,000 if it had wanted to.

In the current issue of the Political Quarterly there is an interesting article by a Mr. Christopher Rowland, who was a Labour Party candidate at the last election and a former employee of Transport House. He makes it clear that the Labour Party could have afforded it if it had wanted to. It is worth pointing out that on the evidence of this gentleman, who, I imagine, knows the facts, £200,000 is produced by less than ld. per month per affiliated member of the trade unions. That is what he says.

Mr. Rowland is also rather frank about the shortcomings of Labour Party publicity and the sort of attitude to other people's publicity which the right hon. Gentleman has displayed. He says: An appeal to 'fair play' in expenditure"— by the Labour Party— would only produce a charge of sour grapes. That is Mr. Rowland, not me. It is a feeling that the House should be aware of. We know that the real reason for the Opposition's failure in publicity was twofold. First, they had a very poor policy, and a muddled image to publicise and, secondly, they had an old-fashioned prejudice against advertising, which led them to put their money through the voter's letter-box instead of in his morning paper.

I gather that no one but Mr. Morgan Phillips has ever suggested that it was because of their bad advertising campaign that the Opposition are still the Opposition. The Leader of the Opposition certainly made no such suggestion when he addressed the Labour Party Conference at Blackpool. Moreover, it is clear from what he said there that it is his view—and I believe it is his party's view—that advertising expenditure in itself is not immoral for, referring to the propaganda of the Conservative Party, he said: The lesson is that we"— the Labour Party— must revise altogether our ideas of how much money we should be raising and spending for posters and other forms of propaganda. That seems a much sounder, more honest and far more courageous reaction than is apparent from the Amendment that we are discussing and the speech to which we have just listened.

The right hon. Gentleman mentioned Colman Prentis and Varley. We have always known that the Labour Party has an aversion to this firm. There is now a further reason for it to have an aversion. I do not know whether the right hon. Gentleman is aware of this, but the Labour Party's best man, Mr. McWhinnie, the veteran Daily Herald executive, and the party's publicity expert at its headquarters during the election, has naw joined the Colman Prentis and Varley group. [Laughter.] In the midst of the laughter, the House may not have noticed that I said that he has joined the "group."

Hon Members

A subsidiary.

Mr. Sydney Silverman (Nelson and Colne)

Not the Institute of Directors.

Sir T. Low

The other point which the right hon. Gentleman made, and which I am sure he did not want to make, was this. He implied that Colman Prentis and Varley settled the Conservative Party's policy. The right hon. Gentleman knows perfectly well that that is not so. As the right hon. Gentleman has quoted and taken figures from the Butler and Rose book, perhaps he will look at what is stated on page 33, where the matter is clearly spelt out. After analysing what happened before and during the election, it is stated: But the rôle of public relations in politics is not to make policy but to increase public appreciation of successful policies and to identify the party with popular symbols.

Mr. Gordon Walker

In view of the advertisement in the New York Times which I produced, is the right hon. Gentleman suggesting that the Colman Prentis and Varley organisation does not always tell the truth?

Sir T. Low

I have not seen the advertisement. I do not believe everything that I see in advertisements, and I do not believe that the right hon. Gentleman does. What I am saying is that I am clear that Colman Prentis and Varley do not settle Conservative policy. I am also clear that the Butler and Rose combination, in analysing what happened, accepted that. If the right hon. Gentleman will read the book thoroughly, he will see that that is so.

Mr. Ellis Smith (Stoke-on-Trent, South)

I thank the right hon. Gentleman for giving way. I want to provide him with some more evidence of the kind which he has already produced. Is he aware that an ex-industrial editor of the Daily Herald is one of the principal officials of the Institute of Directors?

Sir T. Low

That is a very good thing for the Daily Herald which, I gather, is in difficult times.

I now want to pass to another point. It would surely be the greatest mistake—and The Times pointed this out in its leader—to think that advertising is the only channel of pre-election expenditure which has an electoral bearing. It is here that I want to analyse some of the other forms of political expenditure which have a political bearing. The first concerns the political activities of trade unions. I do not know whether it is generally recognised that more than two-thirds of trade union political funds are used by the trade unions for political purposes and do not pass through the Labour Party's accounts.

In 1957, the Labour Party's accounts showed that only £200,000 was provided from the trade unions political funds and that the total of its funds was over £700,000. I think that these figures are right. [HON. MEMBERS: "What about the Tory Party's accounts?"] I will come to that. I am not complaining about this, but I think that it ought to be borne in mind.

In addition, we know perfectly well that general funds are used for trade union journals, many of which are notoriously pro-Labour Party and anti-Conservative Party. Also, there is the immense advantage, which it is not possible to qualify in money terms, which the Labour Party enjoys from having the nucleus of a party organisation in most trade union branches and in many shop stewards meetings. These are the facts. I am not whining and wailing to the House about them. I am saying that they are the facts.

Mr. J. J. Mendelson (Penistone)

While the right hon. Gentleman is giving these figures about trade unions and the Labour Party, would he not agree that it would help the debate if he were to put side by side with them the figures concerning the Conservative Party and the contributions which it receives?

Sir T. Low

It would help very much if I could get to the part of my speech dealing with accounts, and I would got there much quicker if I were not constantly interrupted.

The next subject about which I want to talk is the co-operative societies. I am told that in 1957 over £500,000 was spent by retail societies on education. Most of this expenditure was party political expenditure.

Mr. George Darling (Sheffield, Hillsborough)

On a point of order. When a completely untruthful statement like that is made—[HON. MEMBERS: "That is not a point of order."] It is a point of order. When an untruthful statement of that kind is made, would it not be helpful to the right hon. Gentleman if we were to tell him what were the facts? This expenditure on education was not Political.

Mr. Deputy-Speaker (Sir Gordon Touche)

That is not a point of order. It is a point of argument.

Sir T. Low

I am sure that the hon. Gentleman did not wish to accuse me of an untruth. I am told that that is the position. If I am wrong, no doubt the hon. Gentleman will try to catch your eye, Mr. Deputy-Speaker, and we shall hear what he has to say about it.

Mrs. Harriet Slater (Stoke-on-Trent, North) rose——

Hon. Members

The hon. Lady cannot take it.

Sir T. Low

I should now like to turn to a consideration of the constituency Labour parties. Many of us are not aware of the kind of funds which the constituency Labour parties have at their disposal. But on 7th October, 1955, in an article in Tribune, which I am told at least half the members of the party opposite believe, by Mr. Ian Mikardo, whom we have not here any more, it was stated that the constituency Labour parties had an annual revenue of £1 million. That is not a small sum. Further, if the right hon. Gentleman has read the Butler and Rose book, he will know that on page 28 reference is made to the help given to the Labour Party by the staff of the Daily Mirror. No money value was stated.

Finally, under this head, let me come to the Daily Herald.

Mr. Mendelson rose——

Hon. Members

Try to learn to take it.

Sir T. Low

The important thing about the Daily Herald, which is unrivalled by any other newspaper in the country, is that the political aspect of its editorial policy is, in effect, controlled by the T.U.C. and the Labour movement. In considering political expenditure on publicity, some account must be taken of that fact.

Mr. Mendelson rose——

Sir T. Low

I will try not to tax the patience or tempers of hon. Members opposite too much in future.

This is by no means an exhaustive list. I do not think that it can be matched fully by the Conservative Party, although we have our constituency asso- ciations which are just as active as, if not more active than, those of the Labour Party.

I now turn to the point made by the right hon. Gentleman about the industrial companies and associations to which he referred. He referred to this vast expenditure, allegedly, I suppose, in support of the Conservative Party. What was that expenditure for? It was for free enterprise against nationalisation. Who provoked it? It was not the Conservative Party, but the Labour Party. Who threatened who? What happened? These men replied. The naughty animal defended itself.

It is helpful to know—for this is the implication of what the right hon. Gentleman said—that in the new Socialist animal farm such a form of defence will not be allowed. If we are to have arguments about what is unfair or unsporting, this objection to defensive expenditure seems to me to take the bun. If we are to have the argument about what is called incursion into politically relevant expenditure—I think those are the words the right hon. Gentleman used——

Mr. Gordon Walker

Mr. Butler.

Sir T. Low

That Mr. Butler is not in this House, so I will take it from the right hon. Gentleman.

I really think that to complain about that kind of incursion is very remarkable even for hon. and right hon. Gentlemen opposite.

But what does all this amount to? It amounts to this. It is very clear that there is a great quantity of political activity, both within and without the political parties between elections, and there is nothing new about that at all, any more than there is anything new about political publicity, and there is nothing new in the Labour Party or any other party taking action through publicity methods or otherwise to try to help to win an election two or three or four years on.

Look for a moment at what the Labour Party did before the 1945 election. Have they forgotten the Gollancz Yellow Books? What was the effect of "Guilty Men"? It is quite impossible to quantify, but I suppose that the right hon. Gentleman is so ashamed of it he does not recollect anything about it. One of the consequences of "Guilty Men" was, I suppose, that its impression upon the electorate was so great that we had that terrible Government between 1945 and 1950.

I have sought to establish—I hope hon. Members opposite will accept that this is what I have sought to do—that the arrangements under the present law really do not involve any unfairness as between the Labour Party and the Conservative Party.

Mr. Darling


Mr, Jeremy Thorpe (Devon, North)

Both are wrong.

Sir T. Low

I see the hon. Member for Devon, North (Mr. Thorpe), who represents the Liberal Party. I have heard it said that the Liberals want the rules of the political game to be changed. There is nothing new about that—among those who have been as long a failure as they have been; but I am surprised to hear that they are considering the virtues of controlling political expenditure or even controlling political incomes. I do not know quite how this fits in with Liberal doctrine, this flirting with controls, for, as I will show in a moment, the control of this kind of expenditure is quite inconsistent with freedom. I observe on the front of the Liberal Party's handbook that the aims of that party finish with these fine words: In all spheres it sets freedom first. So I hope that in the few more minutes I wish to speak—after all those interruptions—I shall carry those hon. Gentlemen with me.

Just suppose that there was a mischief—I will accept for a moment that there was a mischief—and there had to be some control of political expenditure. What is political expenditure? How do we define it? Is it the expenditure of political parties? And, if so, what is a political party? I do not know whether the Labour Party is a legal entity, but I can assure the House that the Conservative Party is not a legal entity. So we have, first, to define what a political party is if we wish to control political expenditure defined by the expenditure of political parties, but in fact, if we did we should not, of course, cover the point which the right hon. Gentleman mentioned about incursion into the political field from outside. So I take it that he would not want to go very much wider.

We have to accept that Members of Parliament or members of political parties have not a monopoly of political wisdom or activity, and that there are other people outside who write books and who write plays, or make speeches, and who have a right to influence the political field. What happens if we do start going much wider? Immediately, we bring into this field of control any expressions of opinion—I suppose, following on what the right hon. Gentleman says, any expressions of opinion which cost money in some way and which may have a bearing on an election.

That may be speeches by chairmen of companies on restrictive practices, or even attacking the Chancellor for bad economic policies. It may be that. [HON. MEMBERS: "Nonsense."] What about the campaign for nuclear disarmament, organised by an eminent cleric? What about the campaigns run by convinced social workers to further the recommendations of the Wolfenden Report? What about the activities of old-age pensioners' associations? They all have a political impact. What about some of the plays? There are two successful plays now running in London, one called "The Visit" and the other called "Rhinoceros"—owing to the activities of the Whips I have not been able to go to either—which have both been described as brilliant and telling attacks on the capitalist system and the so-called affluent society. Would they be considered as Labour Party propaganda?

What about the other side? I have taken the one side, the anti-capitalist. I will take another one which some hon. Gentlemen opposite complained about. Just before the election there was the film, "I'm All Right, Jack". Ought that, therefore, to have been subject to control? If so, how do we work it out? All that seems rather absurd, though it is completely logical, and if we extend control to plays and films, how can we avoid extending it to books and eventually right inside the Press, particularly that part of the Press which is controlled under an agreement by a political party? I wonder whether the right hon. Gentleman has really worked out what is the effect of what he has said.

That is one half of the matter, but there is the other half of this question of political expenditure. What is expenditure? Does it simply refer to the spending of money? Or is the contribution in kind also to be controlled? What happens if it is? We have voluntary efforts for political aims whether inside parties or not, and once we get at them surely we are damaging a basic part of our free, democratic life. I certainly would not wish to control in any way the political activities of trade union branches, or even shop stewards or "pub" landlords. I do not really believe that hon. Gentlemen opposite would do, either.

Let us have a look now at what the control would be.

Mr. Joseph Slater (Sedgefield) rose——

Sir T. Low

I do not want to give way, because I am drawing to a close.

If we work out how we would control, there is surely only one way in which to do it—setting a limit to how much money may be spent beyond which it must not be spent. Then we get some really most absurd things. I will take only the most absurd. What happens when we have a dispute inside a political party?

Mr. John Diamond (Gloucester)

It never happens.

Sir T. Low

Mr. Cousins's expenditure, or the Tribune's expenditure—is that to be charged up to the accounts of the right hon. Gentleman the Member for Leeds, South (Mr. Gaitskell)? Or is he to be given—much worse than that—some power of controlling what is done in the way of publicity or political activity by Labour Party supporters? I should like hon. and right hon. Gentlemen opposite to think about the implications of that. That is surely enough to show how farcical and absurd and how dangerous this proposal for control is; and I think that I can come now very shortly to this question of publishing accounts.

Hon. Gentlemen will see that the same arguments apply. What is a political party? What expenditure must be included in its accounts and what income? Would constituencies be included? Would wards' and hamlets' expenditure be included?

Mr. S. Silverman

Do it in the way that we do it.

Sir T. Low

The way that the hon. Member does it is to leave out about four-fifths of the expenditure, and that I regard as extremely misleading.

If the right hon. Member is really sincere in telling the House that his main objection to the present system is the incursion into this field by outside bodies, how would the publication of party accounts deal with that point? [An HON. MEMBER: "Have an inquiry."] Why do hon. Members want an inquiry to something which is as obvious as that? It has been alleged that the Labour Party publishes its accounts. It publishes an account, but leaves out an enormous amount of money spent to its advantage. The Liberal Party publishes an account which is not even an account of its party, but an account of its headquarters organisation. It shows an income of £24,000 and I believe that the activities of the Liberal Party as a whole are rather more than £24,000 would account for.

Let us stop this complete humbug of the Labour Party and the Liberal Party publishing true and full accounts. They do not do so, and, I venture to say, could not do so, because it is quite impossible to give a clear picture to outsiders of the full activities of any political party for the reasons that both I and the right hon. Member have mentioned. That has been found here and it has also been found overseas. So far as I have been able to find—and I have done some research into this question, covering several months—nowhere in the free world is there any effective system of control of political expenditure, or of political parties' incomes, and nowhere an effective system for the compulsory publication of full and meaningful accounts by political parties. That is a fact.

Mr. R. T. Paget (Northampton) rose——

Sir T. Low

I cannot give way; I must conclude my speech, for I have spoken long enough. A Frenchman, M. Fusilier, has summarised the position as follows: Under the democratic forms of government, laws to regulate the finance of political parties are both few (since in general there is no definition of the constitution of political parties) and, where they are relatively precise, are not enforced and remain a dead letter … This weakness can be attributed not so much to deliberate design on the part of the legislators as to the fact that the development of a strict system of control would be both ineffective and dangerous to the whole democratic system. That is not just my view, nor the view of anyone in this country, but the view of a Frenchman who has studied these points very carefully. I challenge hon. Members opposite to explain how there could be any general control of political expenditure, other than we have at election time, that was both effective and consistent with the essential freedoms of our political system.

It is well worth remembering that, however fiercely we fight our political battles here, there is at present no corruption and no under-the-counter behaviour. Introduce controls into the political system affecting, not a short period, but the whole period between elections, operate them all the time, and it is certain that it would not be long before someone, somehow, not, perhaps, in the large parties, set up a black market in political propaganda; and, after all, there are so many mediums available for that. Open propaganda splash is better than concealed propaganda subterfuge. The right hon. Member knows that as well as I do. Controls of the kind that he has been talking about are absolutely inappropriate in the field of opinion and argument.

Like all controls, a control of political expenditure would be bound to favour the Establishment and this control on the expression of political opinion—for that is what it would be—could eventually destroy our democratic government. To those who are genuinely worried that propaganda may grow too intense, I can only say this. The good sense of political parties and of the public generally will surely ensure that publicity activities are not overdone, if only because if they are overdone they would defeat themselves. Not for the first time, the party opposite would be wiser to trust the people.

4.55 p.m.

Mr. Ellis Smith (Stoke-on-Trent, South)

When anyone has had a few years' experience in public life, especially in the House, he learns to take hard hitting in the right way, but I regret the many inaccuracies and innuendoes contained in the speech of the right hon. Member for Blackpool, North (Sir T. Low).

I have thought for some time that standards in the House and in the country have been changing. Throughout the whole of my time in the House, I have never known reference to be made to a previous hon. Member in the way in which it was made today to Mr. Mikardo. It is true that Mr. Mikardo was defeated in the General Election—and we have learned to take that kind of thing in the way we should—but to make reference to it after the way in which he has served this House, and after other aspects of his activity in Britain, was something to which we should object.

Sir Leslie Plummer (Deptford)

It was typically low.

Mr. Ellis Smith

All we are asking for today is an investigation into political expenditure. We would stand by the results of that investigation, because we are confident that if a committee were set up it would recommend the publication of all political expenditure, which is what we are asking for. So strongly did my hon. Friends and I feel about this that we tried to use our Parliamentary rights to raise the question on the Third Reading of the Finance Bill. We felt strongly about it for several reasons, the main one being that it is now nine months since this Parliament assembled and not until today has there been an opportunity to raise this fundamental issue and challenge to British democracy. If anyone doubts the challenge to British democracy, I hope that he will be good enough to remain for a short time while I produce evidence to prove it.

The second reason why we desired to raise this question was as follows. Anyone who has studied Erskine May and has had any experience of Parliamentary practice, usage and the generations of democratic development in this House, knows that in the past this kind of thing has been used by rich men. That is why we desired to take advantage of this opportunity.

After reflection, and after reading the OFFICIAL REPORT, I want to be unequivocally clear about my own conduct. I accept without any reservation the right of Mr. Speaker or the occupant of the Chair not to select Motions or Amendments, and that that right should not be challenged. On that I plead guilty to my activity in the House on a Friday a little time ago, when I came into conflict with the Chair. Having made that clear, I think that if anyone studies the procedure closely he can understand to a certain extent the line I took on that day. I was reinforced by the strong feeling there is on the subject and by the controversy which had been aroused outside.

We consider that the means by which the results were obtained in the last General Election were a fundamental challenge to British democracy. I am not saying for a moment that that was the only reason or cause for the Labour Party losing the last General Election. I know that there were very many reasons, and if any hon. Member were to interrupt me and point them out I would readily accept a number of them. But, fundamentally, the challenge arises on this abnormal expenditure on political matters for eighteen months prior to the last General Election.

If anyone doubts that, I would ask him these questions: where will it stop? What are the limitations? It was £.1½ million last time; how much next time? I am delighted that my right hon. Friend the Leader of the Opposition had made an official statement that if the Labour Party is returned on the next occasion one of the first things it will do is to nationalise the steel industry. I hope that we mean business on that. Anyone who followed the rise of the steel barons in Europe prior to the war, and knows how they supported political activity and challenged democracy, knows that the same kind of people will do the same thing here. Therefore, before it is too late, before this challenge is made in other directions, we as a panty want to safeguard democracy, and we are appealing to right hon. and hon. Members to join with us in referring this matter to a Committee for investigation. If that Committee suggests certain regulations on the publication of political expenditure, that is all that we are asking for.

How much will it be next time, after this £1½million last time? Twice, in two world wars, this country has been challenged. We saved this land—the men of my generation who are lying in their graves all over the world—but the land still belongs to the landlords, as is evidenced by last Monday's debate. If we propose to deal with the land question fundamentally, we are entitled to refer it to a democratic decision of the people of this country. If a democratic decision had been asked for sixty years ago, the Radicals would have rallied this country, especially the late Mr. Lloyd George, on the issue "The land for the people." These are the kind of issues raised. Members of the Institute of Directors may think that this is a joke, but, so far as we are concerned, it is a challenge to democracy, and we intend to state it in the House and outside until this grievance of ours is redressed.

Mr. A. E. Cooper (Ilford, South)

I am not disputing the right of the hon. Member and his colleagues to make any assertions they like. They may wish to nationalise steel and nationalise the land, but is the hon. Gentleman, having made his point on policy, saying that those who have a contrary view are not to be allowed to spend money on defending their point of view?

Mr. Ellis Smith

That is a very fair question which I shall deal with later. I hope that the hon. Member will be present when I deal with it. We are not saying that at all. We are saying this: the Conservatives hold an annual conference and come to decisions. The Labour Party holds an annual conference and comes to decisions. When, as a result of our conference, we decide on a policy and it goes before the country, it should be left to the people to decide, and £1½ million should not be spent by the steel barons and others, prior to a General Election, in trying to bring about the situation that the people are not judging the issue on the correct basis, in a fair way, as used to be the case. I will deal in more detail with that later.

For the time being I want to remind hon. Members about Parliamentary rights, practice and usage, because we should have raised this issue long before now. We should have demanded an independent investigation into the whole constitution and action of those who spent£1½million prior to the last General Election. The Third Reading of the Finance Bill, in my view, gave us the opportunity. We should have said, and I am now saying, that the normal expression of democracy was prevented at the last General Election. We want to prevent a re-occurrence. We want to safeguard democracy. In our view, therefore, the Government should agree today to an independent investigation into this matter.

Mr. Victor Goodhew (St. Albans)

Is the hon. Gentleman telling the House that he believes that the whole process of democracy is frustrated by the attention of the British electorate being drawn to the issues at an election?

Mr. Ellis Smith

I have listened to the hon. Member's point. I will deal with it in a courteous way, and I hope that he will treat what I have to say in a courteous way. The short answer, as an hon. Friend has reminded me, is that the dice are loaded. That is the first point. The second is that this Eli million was made by hard working people and ought not to be used in the way in which it was used.

Fifty-one years ago the non-elected other place—let me emphasise—showed the House how to use its Parliamentary rights. In 1909, the Finance Bill was rejected by another place until it had been submitted to the country for the judgment of the people. Fifty-one years later, we do not even support the proposal for a Select Committee. It has taken nine months for this issue to be raised.

The following should be put on record, because if we obtain a majority in the future, which I am confident we shall if we act as a real Labour Party, a radical party, we shall rally the people of the country behind us and then it will be necessary to take advantage of our Parliamentary rights. What are they? The supreme, absolute authority for the control of finance in this country rests with the elected Members of the House of Commons. Therefore, if we assert that right, we can deal with this problem as it should be dealt with. One of the most urgent problems will be to demand an independent investigation into this abnormal expenditure of £1½ million.

It is easy to raise this subject now because there have been so many articles and there has been so much controversy in the country. But some of us stand on good ground with regard to this. Within a few days of this new Parliament assembling I made the following statement. I remember the Leader of the House being sceptical and slightly critical—to which I take no objection—but also cynical about what was said on that occasion. I said: After the last General Election politics in Britain can never be the same, and those hon. Friends of mine to whom I shall refer later must bear this in mind. Let me make it clear that I am not complaining, I am not whining. As I understand the social and economic forces which are at clay This is a challenge. Instead of retreating we ought to accept the challenge … I am confident that if we accept this fundamental challenge to democracy and state it clearly in the country and let the people know what is at stake, they will respond to an appeal of that character. Then I went on to say: Thousands of pounds, if not millions, were spent during the last twelve or eighteen months—but I do not believe in overstating the case—in the biggest publicity barrage of all time…"—'[OFFICIAL REPORT, 27th October, 1959; Vol. 612, c. 113.] Little did I realise that it was not thousands of pounds that was spent but £1½ million. That should not be allowed to pass without an independent investigation being made before the next General Election.

I would point out that in view of what is at stake in this country, in view of our desire to save our country, in view of our desire to bring about more public ownership, and in view of our desire that Britain should make a greater contribution to avoiding another terrible catastrophe, the reaction of the country will be not to stop at spending millions rather than merely limiting itself to £1½ million.

It is for those reasons that we are raising the issue in the way in which we are doing it. We do not object—let me emphasise this to the right hon. Member for Blackpool, North—to legitimate expenditure on political activities. What we do object to is abnormal expenditure of the character to which I am now going to refer. There were, for example, the following amounts: the Iron and Steel Federation £287,000; Stewarts and Lloyds £269,000; the Institute of Directors £60,000; the Road Haulage Association £19,000; the National Union of Manufacturers £10,000; Public opinion polls £475,000; and the Economic League £208,000.

I was pleased to hear my right hon. Friend the Member for Smethwick (Mr. Gordon Walker) speak in a very critical manner of the contribution of £107,000 by Aims of Industry. I hope that this will mean that there will be no more Labour Members of Parliament and prominent trade unionists speaking on the platform of Aims of Industry.

The total expenditure by all these organisations amounts to nearly £1½ million. In our view, this was the most unconstitutional action taken in this country prior to a General Election since the days of the Red Letter.

Mr. Frank Allaun (Salford, East)

Before my hon. Friend leaves this point, is it not a fact that the Government themselves deceived the House on this matter before the last General Election? I refer to the questions which were put week after week to the Chancellor of the Exchequer. The Chancellor was asked whether this expenditure by private firms was tax free, because we held that the law said that only expenditure wholly for the purpose of a firm's trade was tax free. Week after week the Chancellor refused to answer our questions. That is a fact. Now, apparently, after the General Election it is turning out that this expenditure was tax-free. The House——

Mr. Deputy-Speaker

Order. The hon. Member has not been called to make a speech.

Mr. Ellis Smith

I am grateful to you, Mr. Deputy-Speaker, for allowing my hon. Friend to make his comment. I much appreciate it. I thank my hon. Friend for his very informative interjection. I hope that you. Mr. Deputy-Speaker, will make due allowance, because it is a fact that week after week these questions were asked. Some hon. Members opposite—I am not speaking critically now—thought at the time that my hon. Friends were overdoing it because we were raising the matter so often, but now, as my hon. Friend has said, we have seen from financial newspapers and other periodicals that the allegations that we were making in those days have been proved to be justified. My hon. Friend was giving further information about the seriousness of the issue that we are considering, and I thank him for his evidence.

The last General Election was preceded by a new modern form of extensive corrupt practices. The right hon. Member for Blackpool, North, to whom we listened with great courtesy in spite of some of his innuendoes and misstatements—it may have been misinterpretation— —

Mrs. Slater

It was misleading.

Mr. Ellis Smith

My hon. Friend the Member for Stoke-on-Trent, North (Mrs. Slater) ought to deal with this matter. She says that when she and others went to Blackpool the Conservative Party spent a large amount of money in the local Press in trying to defeat what they went there for.

Mrs. Slater

They were members of the Co-operative Movement.

Mr. Ellis Smith

It was legitimate Cooperative business, and the Conservative Party was not correct in the use of the expenditure for which it was responsible in the Blackpool Press.

Sir Douglas Glover (Ormskirk)

How much did the Co-operative Movement spend?

Mrs. Slater

Nothing in the Press. It was a Tory Press.

Mr. Ellis Smith

I now want to prove the statement I have made with regard to extensive corrupt practices in a modern, 1960, form. I claim that the gigantic expenditure of £1½ million should have been considered before now, and should be considered as soon as possible, by the Attorney-General. I would ask the Leader of the House whether the Director of Public Prosecutions has considered the matter, and whether we can have an investigation into it.

Mr. Philip N. Hocking (Coventry, South)

When the hon. Gentleman asks that the attention of the Director of Public Prosecutions should be drawn to this matter, will he also include all the literature which is distributed by the trade unions before elections? Also, will he on his way to Stoke-on-Trent during the next weekend go through Coventry and look at some of the posters which the Labour Party is putting up in preparation for the municipal elections?

Mr. Ellis Smith

My wife complains so much about my being away that I shall not go to Coventry. I shall be going home as soon as I can.

Sir D. Glover

Is it the case that if the hon. Member goes to Coventry he will be sent to Coventry?

Mr. Ellis Smith

I do not fear being sent to Coventry, having had the confidence of thousands of the working men and women of the area where I live, having lived among them in my own house, sharing their difficulties and their way of life. I have never been affected by the things which affect so many people. I have never been where so many have gone this afternoon. I have never been dined and wined. These people know it. I welcome interruptions. This is what the House is for. We do not mind questions, and I will answer the hon. Gentleman's question. We will readily agree and will place every book and report we can at the disposal of a committee of investigation, because honest men fear nothing. Those of us who have been trained in the trade union movement know we have got to account to Government auditors for every farthing. That is what we are asking with regard to this and that is the reply to the fair question put by the hon. Member.

Trade unionists have to contract in by law, and right hon. and hon. Members—because I must associate the Leader of the House with this—are indulging in a large amount of propaganda and education, as they look upon it. They are organising conferences throughout the country. The influence is not all coming from the trade union movement The Institute of Directors is gathering increasing influence and using in it different directions. Therefore, seeing that we have to raid our finance in this way, we say that if it is right that this should be applied to us it is right to apply it to everyone else. The whole of the income we derive is from weekly or quarterly contributions from men and women organising the trade union movement. Our expenditure is relatively small and can be explained, and has been accepted in the past. We complain about the difference between a few thousands and £1½ million of the type of expenditure which I have described.

Compare our position with the thousands of pounds given by the financiers, by the landlords and by the industrialists. In our view, this is a negation of democracy; it is a negation of British ideals and standards. In this I speak only for myself, but in my view it represents the introduction of American ideas into British political activities. The trade unions have to account for every penny. They are subject to rigid and strict Government audits. Our balance sheets are open to all, and so are those of the Labour Party in the annual reports.

I ask the Leader of the House to look at this. In accordance with the law of the land, every penny must be returned by every candidate engaged in a General Election. Here is returned a total amount of £1,051,000. To that should be added £1½million, making a total amount of £2,551,000. Therefore, I have no hesitation in saying that, as the old form of corruption was cut out by legislation, now this kind of corruption ought to be eliminated by legislation. The first step towards that is to have an impartial investigation, and that is what we ask for.

Let me make clear to every hon. Member who has been good enough to listen, and in particular to the Leader of the House, that we are not speaking only for ourselves. I have in my hand extracts from the July issue of the monthly journal of the Amalgamated Engineering Union. That union is responsible for organising a million people engaged in the export trade. They are seriously disturbed by the issues we are raising today. I should like to get this quotation on the record but I do not want to take up more time. I call attention to it because it is typical of what is appearing in a number of trade union journals and that is the reason we are dealing with the matter in this way.

5.27 p.m.

Mr. Charles Curran (Uxbridge)

I do not wish to follow the hon. Member for Stoke-on-Trent, South (Mr. Ellis Smith) in his complaint about the spending of money at election time. Both sides do it, and I do not believe that it is any good crying "tit-for-tat". Industry spends a lot of money and so do the co-operatives. When we talk about the expenditure of money by bodies other than political parties, there are a great many things to take into account. One has, for instance, to take into account the enormous value of the efforts exerted by the Daily Mirror at the last election on behalf of the Labour Party. I do not know how one measures that. I do not complain about it, not a bit. I do not want to put any restraint of any sort on anybody expressing any opinion, either at an election or before it.

I want the hon. Gentleman, instead of dealing in excuses, to look at the facts. It is a curious fact about British politics, and one that has puzzled everyone who inquired into them, that whenever the Tory Party loses a General Election it is an act of natural justice and a natural reward from the indignant electorate. But every time the Labour Party loses an election it is a foul. When I listen to the hon. Member for Stoke-on-Trent, South uttering the stereotyped complaints about Labour defeats at elections he put me in mind of Joe Jacobs, that distinguished man who had a long career in America as a manager of boxers. Mr. Jacobs maintained that his boxers were all unbeatable, and whenever one was knocked through the ropes he would jump up at the ringside and say, "We wuz robbed; it's a foul." The Socialist Party is behaving exactly like Mr. Jacobs. Whenever it loses it declaims, "We wuz robbed".

During the last forty years we have heard one excuse after another from the Labour Party for losing elections—because of the "Red Letter", or because of the "Bankers' ramp", or because of "Post Office savings", and now Colman Prentis and Varley. The truth has got to occur to the Labour Party at some time and it might as well be now. When people do not vote Labour the reason is they do not like the Labour Party. That is all. It is not a result achieved by the trickery of Press agents, or by publicity experts or hidden persuaders. It is because the British people do not want to have a Labour Government. To try to throw doubt on their verdict, and to assert that British people are so stupid and so moronic that they can be led up the garden path by cunning, skilful advertisers, is an insult to British democracy. The British people are quite capable of making up their own minds for themselves.

It is elementary to say this, but to suppose that it is advertising propagandists who create public opinion is completely wrong. The climate of public opinion is not created by advertisers, or by Press experts.

Mr. Frank Allaun

Then why do they spend this£1½million?

Mr. Curran

I shall be glad to tell the hon. Gentleman. They do not create the climate. They seek to exploit a climate which already exists. They do not create the climate, any more than a thermometer creates a heatwave. They measure it and study it and try to make use of it. To blame Colman Prentis and Varley because people vote Tory is like blaming Wall's ice cream because people get sunstroke.

Since I assert that the climate of public opinion is not created by hidden persuaders, by expert manipulators, by Madison Avenue and its British equivalents, I wish to explain, particularly for the benefit of the hon. Gentleman, how the climate of public opinion is created in this country and how it is changed. It is no use supposing that it is all done by mirrors, or by Press agents. It is not.

The climate of public opinion in this country is changed by two forces. It is changed partly by alterations in material conditions and partly—this is the point which I want to emphasise—by the writers and the people who deal in ideas. It is the writers and dealers in ideas more than anybody else who bring about changes in the climate of public opinion, not the Press agents. I want to give some illustrations of this. [HON. MEMBERS: "Including yourself?"]I am speaking as an analyst and doing my best to improve hon. Members' minds. What I say has been said before, and said much better by Keynes. Keynes said that it is ideas which are dangerous, not vested interests. Ideas are dangerous, and in the long run it is ideas, and only ideas, which count. It is the people who write books, as Keynes insisted, who bring about changes in the climate of public opinion.

Mr. A. C. Manuel (Central Ayrshire)

Whose books?

Mr. Curran

I am addressing myself now to the hon. Member for Central Ayrshire (Mr. Manuel), and I want to define for him what I mean by books. I do not mean Reveille. I use the word books in its quaint and ancient sense of 50,000 to 60,000 printed words, one after the other, with no pin-up pictures of any sort to help the weary traveller to plod through the type. That is the kind of book of which I am speaking.

Since 1945 the whole climate of public opinion in this country has been changed by a succession of books. It has become completely hostile to the Left. There has been an intellectual counter-revolution, and it is high time that the Labour Party began to study it and the reasons for it.

I will mention a few of these books. The first was published in London in the month in which the European war came to an end. It was written by George Orwell and it was called "Animal Farm". I suppose that it was the greatest piece of satire since "Gulliver's Travels", and it "blew the gaff" on Stalin worship. It destroyed the great idol of our Russian ally which had been erected in this country during the war. It had an enormous impact upon British public opinion. Everybody in this country knows one phrase from "Animal Farm"—the phrase about some men being more equal than others.

Four years later—it came out in 1950 when he was dying—he published a book called "Nineteen Eighty Four." That was a picture of what life is like in England under Socialism [Hon. Members "Nonsense."] I could very easily go on to explain what Orwell thought about it. When he was dying I went to see him in the Cotswolds, at the sanitorium where he was living. I spent a whole day in Orwell's company. We discussed "Nineteen Eighty Four" at length. I had a proof copy; it had not then been published. Orwell told me how he had come to write it and the enormous disgust which he then felt about the beliefs of the Left and the delusions of progress and the nonsense of supposing that one can go on believing in the perfectibility of man.

Those were the phrases which he used to me. Those were the ideas which he conveyed in "Nineteen Eighty Four." The effect of this book, too, was enor- mous. It came out in 1950, and it introduced two phrases into the English language which are still there. One was the phrase "double-think" and the other was the phrase "Big Brother." Everybody in England is familiar with them.

Ths book was serialised, it was sold in large numbers and it was put on television. Its effect on the climate of public opinion in England was enormous. I assert—and I am not the only person who believes this; there are better judges of public opinion than I who hold the same view—that the impact on the British people of Orwell's Nineteen Eighty Four probably had more to do than any other single factor with the Socialist defeat in the 1951 General Election. That book did more than all the speeches, all the advertisements and all the politicians to change the climate of public opinion in England. It is important to remember that 1950 was the beginning of the television years in this country, and Orwell's book was televised.

Mr. S. Silverman

I am following what the hon. Member is saying with the greatest interest. I think that there may be something in it, but not as much as he says. He speaks of a great counterrevolution which has been brought about by these two books. Will he bear in mind that in 1945, when the Labour Party won the greatest victory of its career, its proportion of the total poll was 48 per cent.? In 1959, when it had the worst result, at any rate since the war, its proportion of the total poll was 44 per cent. Thus, the great counter-revolution did not amount to all that he is claiming for it.

Mr. Curran

I appreciate the point and, rather than dismiss it, I should like to deal with it now. When I used the word "counter-revolution" I was talking about the change of opinion primarily in the opinion-forming segments of our society. There are a certain number of people in our community who, make and distribute opinion, and it is when these people change their minds that, by a chain reaction, other people change their minds, too.

The importance of Orwell—the hon Member knows this better than I do—was the enormous influence which he had over the British Left in the 1930s. He was the man who wrote Road to Wigan Pier. He fought in Spain, and he wrote Homage to Catalonia. He wrote Down and Out in Paris and London. This influence which Orwell had over the British Left was not forgotten, and it was not destroyed when Orwell wrote, first, Animal Farm and then Nineteen Eighty Four. That is why I say that the impact of these two books on the opinion-making segments of our society was enormous.

But that was not the end of the story. Orwell was a very good example of the phrase which I have quoted, in which Keynes said that it was ideas and not vested interests which would change the world, but I want to give another and more popular example—the novelist Nevil Shute. Nevil Shute died a few months ago. He was one of the most popular authors in this country. In the course of about thirty years of writing he had achieved almost a unique ascendancy over a new section of our society, what may be called the nontraditional middle class—the engineers, the technicians, the people who go up the escalator from grammar schools and technical colleges and red brick universities. One might almost call Nevil Shute the Dickens of Red Brick.

In 1954, Nevil Shute wrote his autobiography, which was called Slide Rule. Like everything else he wrote, it sold in vast quantities. In this autobiography Nevil Shute told the story of his own life in the British aviation industry. He had entered it after 1918 and he had worked in the 1920s on aviation, writing novels in his spare time. He described how he had been employed as chief calculator on the R100, the free-enterprise airship built in competition with the State-built R101.

In his autobiography, Shute described—it was a savage, blistering and unanswerable attack—how the R101 went to its end. It was the "Titanic" of British aviation. He said that it was because of State management and State muddling. He made a direct accusation that one reason why the R101 went to disaster was because the then Minister of Air in the Socialist Government, the late Lord Thomson, who died in the R101 crash, was guilty, at the least, of meddling, muddling vanity.

Almost everyone connected with British aviation has read that book—even men wino never read novels read Shute. His remarks about State management, control and planning have been discussed by wide sections of opinion-forming people in this country, and have had their effect in the new industries and the new techniques developed since 1945. Shute did not stop there. As a result of his experience over the R101——

Mr. John Mackie (Enfield, East)

Can you, Mr. Deputy-Speaker, tell me how the hon. Gentleman's speech is related to the debate on political expenditure?

Mr. Deputy-Speaker

I understand that the hon. Member is trying to point out that political opinion is influenced by literature and not by party pronouncements.

Mr. S. Silverman

I understand the point which the hon. Member is trying to make, but, surely, Mr. Deputy-Speaker, it is rather a long way from a debate about the control of expenditure. Having made the point, would it not be better now to come back to the Amendment?

Mr. Curran

The two previous speeches were made by hon. Members who insisted that the illegitimate—the last speaker called it the "corrupt"—expenditure by propagandist bodies and of partisans on the Tory side, was probably responsible for changing public opinion and winning the election for the Tory Party. That is an important accusation, and the people who made it are urging that there should be an inquiry to see whether there Should be a change in the law. Surely it is relevant to say, in reply, that there is a different explanation which is far more credible. That is what I am seeking to do.

Far from being shut up by the hon. Member for Nelson and Colne (Mr. S. Silverman), I am determined to put the case, even if he does not like it. I say that Shute who had this unique influence among the non-traditional middle class in England and whose experience of the R101 and of State planning led him——

Mr. S. Silverman

On a point of order. I submit, with great respect to you, Mr. Deputy-Speaker, and without wishing to upset the hon. Gentleman, that what he is saying is going a very long way. If he is to be allowed to continue this discussion about Nevil Shute and the R101, is the rest of the debate to be taken up in answering it, or will hon. Members who try to do so be out of order? It has nothing whatever to do with whether there should or should not be an inquiry into political expenditure and control of political expenditure —nothing at all.

Mr. Deputy-Speaker

I understand that the hon. Member is trying to refute the argument that political decisions were influenced by expenditure on propaganda.

Mr. Curran

I am saying that the arguments upon which that point of view are based are bogus and that the real reason why public opinion has changed has nothing to do with the spending of money, but with the propagation of ideas and the circulation of books. It is not bank books but story books that matter.

Shute went on to write a series of novels about the Labour Government. He hated Socialism so bitterly that in the late 1940s, when he was nearly fifty years of age, he pulled up all his roots and moved to the other side of the world in order not to live under the Labour Government. The effect of the novels that he wrote about the Labour Government, each one of which was circulated in hundreds of thousands, has been enormous.

I wish that the right hon. Member for Smethwick (Mr. Gordon Walker), who opened the debate, would get up and put his point instead of shouting unintelligible remarks. I am trying to put a reasoned case to the House. I hope that somebody who will reply to the Tory side of the House on this matter will deal with the hypothetical case which I propose to put now.

There was published a few days ago, in London, a novel which, in my opinion, will have as big an effect on public opinion in England in I960 as Orwell's novel——

Mr. S. Silverman

On a point of order. May I ask you again, Mr. Deputy-Speaker, and with the deepest respect, what in the world any novel not yet published can possibly have to do with the Amendment on the Order Paper?

Mr. Deputy-Speaker

I cannot tell how the hon. Member will develop his argument.

Mr. Curran

This is an example of what I mean when I say that the arguments that have been used by hon. Members opposite are bogus.

I repeat that a few days ago there was published in London a novel which, in my opinion, is likely to have as big an impact as Orwell's novel Nineteen Eighty Four. I have no connection with the author, or with the publisher. The novel is entitled. When The Kissing Had to Stop. The hon. Gentleman's erudition will tell him that it is a quotation from Browning. The author of the novel is Constantine Fitzgibbon, a novelist whom I have never met. I want to make this point about it. [An HON. MEMBER: "Who is the publisher?"] Cassell. The novel imagines that the Labour Party wins the next General Election in this country and comes into power on a policy of closing the American bases and kicking out the Americans. The novel goes on to describe what happens in England then. It is curious that hon. Gentlemen opposite should have such a curious bias against books.

The novel, in my opinion, will affect public opinion very powerfully because Mr. Fitzgibbon, like Nevil Shute, is a born story teller, crammed with talent. I want to put this hypothetical case to the Labour Party. Suppose that I were to call together a group of reactionaries, —a banker, a brewer, a land speculator, a road haulier and a steel baron—it would be like a witches' Sabbath—and say to them, "I want you to put up £l50,000 for the purpose of an advertising campaign."

Mr. Ernest Popplewell (Newcastle upon-Tyne, West)

Am I right in assuming that the hon. Gentleman classes the people whom he has mentioned as reactionaries?

Mr. Curran

Am I required to spell things out in words of one syllable?

I want the House to imagine that I am prepared to raise £50,000 for an advertising campaign for this novel. Let us imagine that I, with the money which these reactionaries give me, promote a campaign to change public opinion about the nuclear bomb in England. Suppose I send a free copy of the novel to every known opinion-maker in the land; every school teacher, every clergyman, every doctor, every don and undergraduate every university, and I also send a free copy to every Member of Parliament. Does the Labour Party want to forbid that sort of propaganda expenditure?

Such a book would do more to change the climate of British opinion about the Labour Party and about unilateral disarmament than all the propagandists, all the leaflets and speeches and all the activities of the Tory Central Office. Are we to be told that such expenditure is wrong, unjust, and ought to be made illegal?

Mr. Charles Pannell (Leeds, West)

Why does the hon. Gentleman want to circulate this book When the Kissing had to Stop, seeing that Nevil Shute, presumably with a curious degree of success, had already written On the Beach? Why could not Nevil Shute secure a great conversion with that?

Mr. Curran

The hon. Gentleman has asked why I want to circulate this book. I am trying to test the position of the Labour Party by putting a hypothetical case. Suppose that I were to raise funds for the purpose of distributing this book. I believe that by doing that I would make a considerable imapct on the opinion-forming classes of our society. I suggest that that kind of expenditure is perfectly legitimate, and to talk about making it illegal, about outlawing it, and about holding an inquiry into it, is to use the language of unreality.

The truth is that if the Labour Party is alarmed, I am sure that it is alarmed about the change in the climate of public opinion. It is no good its attacking the advertisers and the hoardings. Instead of making war on the advertisers, it must make war on the writers.

The big change in the climate of public opinion since the war has been produced primarily by the dealers in ideas, secondly, by a change in material conditions, and, least of all, by the efforts of advertisers, Press experts and public relations men.

Mr. J. Grimond (Orkney and Shetland)

I take the hon. Gentleman's point. I do not by any means say that it would be right to prevent the circulation of books, but does he not think it is anomalous that, while this can go on on an immense scale, during the election period the individual candidate is still bound by the most stringent rules, some of which hamper candidates severely? Why should everybody else be allowed to spend money and not the candidates? That is a point which should be inquired into.

Mr. Curran

There is a case for saying that the financial limitations now imposed on election candidates are out-of-date. They need to be revised. If anybody suggests that, I will not disagree.

I am concerned with the question which has been raised during the debate, whether we should hold an inquiry into political expenditure. I insist that the changes taking place in public opinion are not brought about by spending money. The people who spend money are simply exploiting the situation which has already been created by the change in ideas brought about by the dealers in ideas. It therefore seems to me that what the Socialists ought to do is to stop worrying about Colman Prentis and Varley and declare war on Nevil Shute and George Orwell. To attack the advertisers and ignore the authors is like trying to tackle smallpox by painting the spots. It is a piece of bogus reasoning.

The Socialist Party has to fight against the change which is taking place in ideas. That change is carrying it away and it cannot hope to stem that tide by passing restrictive laws. In a free society there is only one answer to an argument, and that is a better argument. It is no good trying the gag. I invite the House to agree with me that the case made by the right hon. Member for Smethwick falls to the ground, and that he has exhibited himself as no better than a typographical Torquemada.

5.56 p.m.

Mr. Jeremy Thorpe (Devon, North)

The hon. Member for Uxbridge (Mr. Curran) has entertained many members of the public on television, and it is a relief to know that now that the larger audiences are deprived of his entertainment this does not relate to the whole of the British population; and there is still a small minority here who can be entertained by him. I hope hon. Members will forgive me if I do not relate any deathbed revelations, even of lifelong members of the Labour Party like George Orwell, nor indulge in book reviews because I do not think that that would be appropriate or relevant to the debate.

The hon. Member for Blackpool (Sir T. Low) was insistent that it should go on record that the Tory Party decided the shape of the campaign and not the publicists. I entirely agree. He is right. Let me turn to page 23 of Mr. Butler's and Mr. Rose's book where we read this: Some posters issued in support of the national press campaign also linked photographs of children with slogans about opportunity and freedom from control. When a market-research survey found that the intended audience for these appeals were particularly anxious about getting their children into grammar schools, the party promptly altered the advertisements to show teenagers in gym tunics and blazers instead of toddlers and six-year olds. We would not wish the political perspicacity of the Tory Party to go unrecognised in this House, and the hon. Member for Uxbridge, having spoken about the power of books circulated to every house in the country, and, therefore, the apparent lack of need for political propaganda, we congratulate the Tory Party on its generous and charitable support of the advertising industry

When the question of political expenditure arises, there always comes a sort of Mona Lisa smile on the faces of members of the Tory Party. I hope that we will go into details and get some answers. We have one advantage in that no other Home Secretary can ever had had such experience and such knowledge available to him of the workings of a political party. I shall address some questions to the Home Secretary, some to the Leader of the House, and some to the Chairman of the Tory Party.

Since 1854, there has always been in this country some form of control on the money which individual candidates may spend and the purposes to which they may devote that expenditure. The courts have even defined political election ex- penditure as possibly running before the issue of the writ, and possibly before the adoption of the election agents.

The policy of our legislation, I suggest, is that the only significance in politics relates to 625 individual contests which occur during a short General Election period. That is the whole basis and philosophy underlying legislation. Yet we know how the climate of opinion is apparently changed in the bound works of Shakespeare, Sir Walter Scott and the first edition of "Aereopagitica", which the hon. Member for Uxbridge sees as fermenting ideas. All this happens between elections.

We have heard how the Conservative Party spent nearly £½ million in the 27 months before the last election and the Labour Party £103,000 in the two years before the election. In fact, the Conservative Party spent more money in selling the charms of the Prime Minister than the News of the World spent in selling those of Miss Diana Dors. We may note that, rejecting the candour shown by the News of the World, at least the Conservative Party did not display the Prime Minister in all his nakedness. That portrayal will come when public opinion is formed and the autumn by-elections are in progress.

We know that there are the eight organisations which spent £1½ million. They spent £400,000 more than the total cost of the General Election campaign. Now, we know the sources from which political parties draw their money. [An HON. MEMBER: "Some of them."] We know that some of the money of the Labour Party is drawn from the trade unions and some of the money of the Tory Party is drawn from big business, but we do not know the figures exactly concerning the Tory Party. Why should there be this secrecy? What has the Tory Party to hide? Why is it so embarrassed about publishing its accounts? The Liberal Party has published its accounts for twenty-five years and they have been audited.

What has the Tory Party to hide? Why should it be so frightened? Why this Mona Lisa smile when we ask the Tories to publish their accounts? I put this suggestion to the Tory party—I quote: I should like the finances of the Tory Party to be open for inspection for anyone who may wish to look at them, be he friend or foe. Where you allow secret expenditure you will certainly have corrupt expenditure; and where you have corrupt expenditure you will have vitiated elections, disfranchised boroughs, party disgrace and public scandal. So spoke the father of the right hon. Member for Woodford (Sir W. Churchill) at the Tory Conference in 1883. We all know what happened to his career. He forgot Goschen, but he also criticised his party—an unforgiveable sin, as the right hon. Member for Woodford himself learnt to his cost in the 1930s.

We are not saying that there should be a control of expenditure, but that there should be publicity about expenditure. Why should not shareholders know if their firm has contributed to a political fund? A little inquiry has been carried out by a shareholder who has been writing to the various big firms of which he happens to be a shareholder. He wrote to one firm and said: As a shareholder in your company, I write inquire whether your firm make any contributions to the funds of any of the three political parties. If so, would you please inform me on what occasions over the past five years you have made contributions and of how much? Here is one reply: With reference to your letter … which has been sent on to me by our Registrars, it is not thought to be in the interests of the company that information of this nature should be disclosed. I regret, therefore, that I am unable to answer the question which you raise. That is from British Ropes Limited, Doncaster.

Here is another letter: I am directed to reply to your letter of 18th November, 1959. My directors instruct me to inform you that it is not the practice of the company to disclose details of payments made by the company, save as may be public published in the company's quarterly statement and annual accounts. In the opinion of my directors it would not be in the interest of the company to depart from this practice. That is from the British South Africa Company, 11, Old Jewry, London.

Why should not shareholders know what sums of money are paid in this way? Only a fortnight ago, the Tory Party was pleading with the Chancellor of the Exchequer to encourage share spreading. It is the Tory Party which is the party of the small man, encouraging the spreading of wealth and desperately wanting a property-owning democracy. Why have not those shareholders of whom the Tory Party speaks so fondly have the right to be protected? It is their money which is finding its way into the Tory Party.

The right hon. Member for Blackpool, North said that there are difficulties. There have always been difficulties about the Tory Party publishing its accounts. Let me, however, give the right hon. Member one or two examples of what has been done in other countries. I notice that the right hon. Gentleman has been two months making his inquiries. That is an indication of the worry and strain that the exercise has caused him, but it is an amazing sign of the barrenness of the fruits which he has found.

In America, there is a ceiling on the total expenditure of any campaign and it is forbidden to receive or spend more than 3 million dollars a year. I would hate to restrict the Tory Party to such a small figure, but I am sure that with adjustment, a ceiling figure could be fixed. I am delighted that the right hon. Member is reading the Liberal News, in which much of this information is contained and which gives me the opportunity of giving that admirable publication the same sort of puff which the hon. Member for Uxbridge gave to his literary friends.

Mr. Curran

I made it as clear as words could make it that I disclaimed any personal interest of any kind in the authors to whom I referred.

Mr. Thorpe

I am reminded of the man who spent twenty-five years thinking he had learnt Chinese only to find, at the end, that all he had learnt was the language of the birds. All I can say of the hon. Member for Uxbridge is that he warbled in his full-throated way. He mentioned authors who were his friends, whose deathbed scenes he had attended and whose books he had read avidly. He disclaimed any interest other than merely the bond between authors, which I would not wish to sever and which, I am sure, the hon. Member would not wish the House to think did not exist. I hope that I may be forgiven for being drawn into irrelevancies by the hon. Member for Uxbridge, not for the first time.

Another aspect of American law which might well be considered is that individuals are restricted. They may not give more than 5,000 dollars a year for any one candidate or committee. That might be a little restrictive on certain Conservative financiers, the sort of people who are president of the local association and do nothing except subscribe £5,000 or £6,000 a year. [Interruption.] Did the hon. Member for The Wrekin (Mr. W. Yates) say that he wished that they did? How does he know?

Mr. William Yates (The Wrekin)

What I said was that the election expenses in my constituency were less for myself than for my Socialist opponent.

Mr. Thorpe

The particular is not sufficient for the general. It may well be that the Labour candidate needed more money spent on him—I do not know. Certainly, the Prime Minister had more money spent on him than Diana Dors had in her publicity and, no doubt, the right hon. Gentleman needed it.

The next thing in America is that no corporation or trade union may contribute funds for elections for national offices. Under the Taft-Hartley Act, 1947, it is unlawful for any trade union or corporation to subscribe money to primaries or conventions. This suggests a few things for consideration by a committee of inquiry. Surely, the Conservative Party would like to feel, not that it was getting money from a firm in which there were unwilling shareholders, but that what it got came voluntarily from individuals knowing that they were receiving it and knowing that they were giving it because they wanted to support the Conservative Party.

Sir T. Low

The hon. Member has been quoting what happens in America, and he said that I had quoted from the Liberal News. He has left out the most important point made in the Liberal News, that those restrictions were so wholly ineffective that on the one occasion for which figures were obtained—1952—the total expenditure in the Presidential election amounted to 32 million dollars. Will the hon. Member explain this?

Mr. Thorpe

The right hon. Gentleman is quite right. I was coming to the point that the American restrictions are often breached. The right hon. Gentleman quoted with knowledge of this matter. Legislation which has been tried in Florida since 1951, however, relating to political expenditure, has been found most satisfactory and effective. I assured the right hon. Gentleman that the mere fact that in one country the law is breached is no argument for saying that there is no need of control in this country.

That is what I say to the Tory Party. Would it not be much better if money came to the Tory Party from individuals and not from companies whose shareholders might be ignorant of such contributions and Who might oppose any contribution being made if they knew of it? Would they not sleep happier at nights if they knew that the payments were genuine?

As for the Labour Party, we know that everybody who pays the political levy is a passionate supporter of the Labour Party. Despite the fact that 30 per cent. of the people who call themselves manual workers do notvote Labour, they are, all, nevertheless, apparently, passionate supporters. Would not the Labour Party feel happier if it knew that every penny that it receives from trade union sources came from people who deliberately, voluntarily and consciously contracted in, so that no possible suggestion could be made that anyone paid simply because he felt that there was duress or that it might be politically inexpedient to contract out?

Let us have a clean-up all round. [An HON. MEMBER: "Lloyd-George."] I hear the name of Lloyd-George. I am very sorry that there should be disagreement in the Tory Party about this issue. Let me say, in fairness to it, that the Lloyd-George Fund was principally used for fighting five General Elections, for producing the inquiry on the land, known as the "Green Book," the "Yellow Book" on Britain's industrial future and the policy "We can cure unemployment". [An HON. MEMBER: "Give us the accounts."] If there is any doubt left in the minds of right hon. and hon. Members opposite, I add that one of the sole trustees of that fund is on the Tory benches in the House of Lords. He preceded the right hon. Gentleman as Home Secretary. I am delighted to find that at least there are some Tories in favour of publication of accounts. Let them come out in the open, and we shall look forward to their accounts with interest.

In West Germany, Article 21 of the Constitution states that political parties must publish the accounts of their funds from all sources. There is a democratic regime there which the right hon. and learned Gentleman the Foreign Secretary is always ready and willing to defend. There is, I believe, a draft Constitution before the Bundestag—a copy of it is now in the Conservative Central Office—which is being considered. No doubt this was part of the right hon. Member for Blackpool's researches, but we have not seen the results.

The time has come for the two major parties to come out into the open market with their money. Do not let us have it quietly subscribed by firms and shareholders. Do not let it be possible to suggest that a trade unionist is subscribing because of the contracting-out system, but is opposed to such a subscription. We—the other Opposition Party—are asking in this Amendment, with the wholehearted support of our party—[HON. MEMBERS: "Both of them?"] Our percentage present on this occasion is somewhat higher than that of the other two parties.

We are asking for an inquiry. We say that a prima facie case has been made out. Now, if right hon. and hon. Members opposite go into the Lobby to vote against that demand they are saying that they do not want an inquiry—in which case the electorate can reasonably ask, "Have you anything to hide?" Alternatively, right hon. and hon. Members opposite will be saying that they are satisfied with the present system.

When Members opposite go into the Lobby people will see how the Tory Party reacts to the very simple request that it should consider examining political expenditure in this country. That is all. I suggest that two matters that we should consider are, first, that each political party should provide full, audited accounts, and, secondly, that companies, trade unions, and trade associations should state publicly how much money they have contributed to political organisations and parties. The Liberal Party does, the trade unions do, and the Tory Party should at last do so. This is an occasion for the party opposite to "come clean". It has always been told that it is the party of big business. If it wants effectively to reject that suggestion, here, at last, is its opportunity to do so.

6.15 p.m.

Miss Alice Bacon (Leeds, South-East)

This debate has been marked by the first-class speech of my right hon. Friend the Member for Smethwick (Mr. Gordon Walker) and by two putrid speeches from the benches opposite. The right hon. Member for Blackpool, North (Sir T. Low) made a speech which was rather cheap. He made statements and produced absolutely no proof for them; he bandied about figures in a slick way—figures which were entirely wrong.

One example lies in his comparison of the incomes of the Tory Party and of the Labour Party. He compared the expenditure of the Tory Party on posters and newspaper advertisements alone with the whole annual income of the Labour Party for all its work and the salaries of its regional organisers and others. As to the speech of the hon. Member for Uxbridge (Mr. Curran), all that I can say about that is that he spent most of his time talking about books of fiction, and we can dismiss his speech as just that—fiction and hypothesis.

We are considering the expenditure of vast sums of money drawn from sources not revealed and spent in commercial advertising on an unprecedented scale just before the announcement of a General Election. I was not disappointed in my expectation that the position of the trade unions would be dragged into this debate as the main attack from the benches opposite.

Trade union political activities and expenditure are already controlled. They are completely controlled by law. When a trade union wishes to engage in political activity it must, first of all, pass a resolution to establish a political fund. After that, if the resolution is carried, there must be a ballot of its members supervised by the Registrar of Friendly Societies. If the ballot is successful and the fund is established, every member must be given the right to contract out, and the fund must be kept as a separate account. That is entirely different from the accounts and activities of big business firms.

The right hon. Member for Blackpool, North made great play of the fact that two-thirds of the political levy gathered in by the trade unions was not shown in the accounts of the Labour Party. The answer to that is perfectly simple. I have here some of the accounts of the National Union of Mineworkers and the United Textile Factory Workers' Association. Their accounts—including the political—-are here for everybody to see. They give in very great detail how those two-thirds are spent.

Some of the N.U.M. money is spent in returning to this House miners who would never be here if there were no political fund in their union. Some is spent in constituencies, it is true, but it does not all go to the Labour Party Fund. In many areas it would be well nigh impossible for working men to take part in county councils and other local government activities were it not for the help they get from some of the political funds.

I have the accounts if any hon. or right hon. Member opposite would like to see them. The names of even some of my hon. Friends who are miners' representatives in the House are in the statements, together with the amounts expended on their election. Everything is above board. But let us turn to the accounts of another trade union—the Institute of Directors. These are not published openly. One of my hon. Friends has had the greatest difficulty in obtaining for me the report and accounts of the Institute of Directors for 1959.

I was attracted by one paragraph in the report, headed "Free Enterprise Campaign", which states: What has generally been agreed to have been the most effective development in the Free Enterprise Campaign was the launching of the `Mind Your Own Business' booklet in May, 1959. This booklet, it will be recalled, listed over 500 companies threatened by nationalisation, and was followed up by forceful large-scale newspaper advertising of which the central theme was Is Labour for more State control—or not? '. Currently the Free Enterprise Campaign is financing a survey into the working of the free enterprise system in Britain. I turned eagerly to the balance sheet to find out how much had been spent on the campaign, but I looked in vain for the item until I saw a footnote which said: NOTES: (i) The transactions of the Free Enterprise Campaign Fund which is sponsored by the Institute have not been included in the Accounts. This shows how different is the law for trade unions and for big business.

We have heard today about the Conservative Party's expenditure on Press advertising and on posters, and I want to emphasise that this figure of £500,000—and I would say that this was a conservative estimate—is only for newspaper advertising and for posters. There should be added to it the cost of all the literature and of other services on which the Tory Party spent money. The figure would probably be much more.

In August, 1959 the poster campaign rose very sharply and in July and August of last year the Tory Party was the biggest advertiser in the country. I want to put to the House a point which I know many of my hon. Friends came across during the election. It is quite true that before the election some of these posters were taken down, but it is also true that the agents of the Tory Party were told that they could carry the poster sites forward into the election campaign itself, which meant that the Tory candidates had an advantage over many of my hon. and right hon. Friends in that their poster sites, and they were usually the best sites, were there ready for them.

There was newspaper advertising on a very big scale. It is not true, as the right hon. Member for Blackpool, North tried to imply, that we on this side of the House did not have a story to tell. We had, but when we looked at the cost of some of the newspaper advertising we had to say that it was beyond our resources. Half a page in the People, for example, cost £3,525. When one thinks of all the half-pages in which the Tory Party advertised, one realises what vast sums of money must have been spent. The hon. Member for Uxbridge spoke about the climate of opinion and how it was not created but only influenced in some way by advertising. Let us see, by one example, how that influence is exerted.

There were many newspaper advertisements bearing the heading "You are looking at a Conservative" but these advertisements were rather selective. In the News of the World the Conservative was depicted as a cloth-capped lumberman. In the Sunday Express he was depicted as a black-coated worker, in the Observer as a young scientist, and in the Sunday Pictorial as a working woman.

We do not know how much the Tory Party has spent because no accounts are published, but we firmly believe that the great political parties which can become Governments with favours to give ought to publish their accounts so that the country can see where they get their money.

We suspect that most of the Tory Party's money comes from big business and industry which, as we heard today, before the last election themselves entered the political field on a big scale. Figures have been given in the course of today's debate, and figures have also been published by Butler and Rose, but I believe that these figures are on the low side. Butler and Rose say that the Colin Hurry poll cost £475,000 whereas it was stated in the Daily Telegraph on 4th September, 1959, that it was understood that the Colin Hurry survey cost £600,000. This statement has not yet been denied.

The Iron and Steel Federation is an example of how money was spent by big business. It spent £68,000 in August, 1955. The right hon. Member for Blackpool, North has been giving us some of the answers today and I wonder whether he would care to answer a question of mine. I understand that the right hon. Member is a director of Dorman Long. Can he say how much the shareholders of Dorman Long contributed to this campaign? [HON. MEMBERS: "Answer."] It is obvious that although the right hon. Member ought to know, since he is a director of the company, he does not intend to give the House this information.

The total spent on the anti-nationalisation campaign was £400,000 more than the total expenses of all candidates at the last General Election. There are three things about this advertising by these firms of which we ought to take note. First, as my right hon. Friend the Member for Smethwick pointed out, the dates were very interesting. They led up to a crescendo in August, 1959, the same month as that in which the maximum amount was spent by the Conservative Party. Could it have been that all these campaigns were being directed by some central organisation that knew the General Election date? It seems to me that this was so. Secondly, this expenditure is exempt from tax. Thirdly, the accounts are so secret that not even the shareholders themselves, whose money is being spent, know the amount.

The Labour Party publishes its accounts in detail. We spent nothing on national newspaper advertising and only £22,000 on a poster campaign. I know that many reasons have been given, and perhaps as time goes on more will be given, for the result of the 1959 election. Certainly the Budget of 1959 had something to do with it. The Tory manipulation of finances to give an appearance of this country's financial and economic well-being had something to do with it, but there is no doubt that the money which the Tories and their allies spent before the General Election influenced the result of that election.

It has been said today that this is not the concern of Parliament. The Representation of the People Act lays down the maximum amount that can be spent by Parliamentary candidates. During the election every single penny has to be scrupulously accounted for, and woe betide the election agent who is even a shilling or two out in his accounts. What a farce all this is if, three weeks before the election campaign has begun, the election has already been won by unlimited expenditure on nation-wide advertising campaigns.

As we have heard today, the Conservative Party placed itself in the hands of an advertising agency, which produced the so-called image of the Tory Party by advertising methods. I believe that in doing this it introduced something into our political life which is alien to our British democracy. Do we want our politics run like this? Do we want British politics to become like a battle between two Madison Avenue advertising agencies? I believe that we do not, and I should like to quote from something written by Henry Fairlie in the Daily Mail of Thursday, 9th June. We have heard a good deal about the Daily Herald today, but a lot of other newspapers which always take the Tory point of view have not been mentioned.

Here is somebody writing in a Tory newspaper who has criticisms to make of the party's conduct at the last election Henry Fairlie says: The Conservatives at the last election treated the electors as conditioned morons, who could be won by the methods used by commercial advertisers on T.V. He goes on: This was my first criticism of the Conservatives at the last election. My second was that they introduced into British politics a professionalism which should be automatically rejected by anyone who cares for the health of a free society. The right hon. Gentleman the Leader of the House has still to reply. We have not yet heard what the Government are going to do about this Motion on the Order Paper.

We are not laying down, nor asking for, any special things to be done. What we are calling for is an inquiry, and it is no reply whatever to say, "What about the trade unions, the co-ops and the constituency Labour Parties?" We should welcome that inquiry, and all these organisations would welcome it. They are quite willing to be investigated. What we have been trying to show today is that there ought to be an inquiry, and that there are grounds for that inquiry. We have nothing to hide. We have heard today that the Liberal Party, too, has nothing to hide. We are not asking for any specific action but for an investigation.

It may be that there might be difficulties about legislation, but the inquiry would discover that. Indeed, if the Government resist us and if they divide against our Motion, I think that we can come to one conclusion, which is that the Tory Party, and the Tory Party alone, wishes to hide what it is doing in its accounts behind the doors of the Tory Party Central Office.

6.34 p.m.

The Secretary of State for the Home Department (Mr. R. A. Butler)

We certainly have had a valuable debate on this Motion, which has been marked by fewer speeches than I have ever heard in a three-hour debate. They were long speeches, but they were speeches of good value and good quality, and I am sure that we all appreciated the spirit in which they were made.

My hon. Friend the Member for Uxbridge (Mr. Curran) put with great force a point which much annoyed the hon. Member for Nelson and Colne (Mr. S. Silverman), and it was really quite a pleasure to see it. He put the very simple proposition that it is by ideas that people win elections and not by advertising, business methods or any- thing else. That I believe to be profoundly true. It is because the party opposite has not projected its image to the country and because its ideas are not supported that it did not win the last election and is not at present the Government of this country.

My hon. Friend the Member for Uxbridge quoted Lord Keynes. I could not help remembering another quotation from Lord Keynes about the "assault of thoughts on the unthinking". I felt that very much when my hon. Friend was speaking, seeing how hon. and right hon. Gentlemen opposite were writhing before his assault. Lord Keynes refers to wild words, but I thought that the words of my hon. Friend the Member for Uxbridge were especially wise. The hon. Member for Stoke-on-Trent, South (Mr. Ellis Smith) attempted to raise this matter in an earlier debate, I think without success, so that we were all glad that he had an opportunity of putting his point of view today.

The right hon. Member for Smethwick (Mr. Gordon Walker) made a series of observations, and I shall do my best, in my capacity as being responsible for legislation to reform the electoral law, and in other capacities, to answer him to the best of my ability. What impressed me, amongst other things, in his speech was the extraordinary statement, very satisfactory to us, that as a result of our victory in the last Election there were large rises in share values. That is very satisfactory. I cannot see that that can be regarded as anything other than a justification for the belief and confidence in a Tory Government. I do not myself stand for a boom in equity shares, or any sign or anything of that sort, but I cannot prevent the country showing its confidence.

It is a great deal better than the remark made by the right hon. Member for Dundee, West (Mr. Strachey) in the New Statesman of February, 1954, when he said that the new Labour Government would come into office in a situation in which, even if it attempted to implement its social reform "fair shares" programme, without doing anything else, the national reserves of gold, dollars and foreign exchange would pour out of the country in a torrent. Hon. Members can choose which manifestation they like of the result of a political election.

Now I should like to discuss the arguments of the right hon. Member for Smethwick. He referred to Section 63 of the Representation of the People Act, 1949, and showed that it provides: No expenses shall, with a view to promoting or procuring the election of a candidate at an election, be incurred by any person other than the candidate, his election agent and persons authorised in writing by the election agent on account "— inter aliaof issuing advertisements, circulars or publications; As the right hon. Gentleman knows, there is a saving for the publication of any matter relating to the election in a newspaper or other periodical; The right hon. Gentleman went on to ask if there would be any amendment of this electoral law. I see the point which he mentioned about T.V. and the other point about postal votes, and, indeed, if there are any other points which hon. Members want to put to me at the Home Office they are fully entitled to do so. I will consider them in relation to the future of the electoral law, but I think that the representations ought to be made from both sides of the House and with as much experience of political electioneering and political experience as possible. I cannot at present give any undertaking about an amendment of the law, but I might say in passing, even in reference to this debate, that if there are any matters which hon. and right hon. Gentlemen opposite wish to put before me, whether arising from this debate or not, it is my constitutional duty to examine them, which is the phrase used in the book on the General Election, to which so much reference has been made.

The right hon. Gentleman then mentioned the Tronoh Mines case of 1952, and said that he had brought with him a full transcript. I have taken the trouble to acquaint myself with that case, and the conclusion is that the Act only prohibits unauthorised expenditure on propaganda in support of a particular candidate in a particular constituency.

It will not surprise anyone who attended the original debates in 1948 and the debates on the later consolida- tion Measure in 1949, as I did, that that should have been found by the courts to have been the interpretation of the present law, and that the present law does not restrict expenditure on general political propaganda. It is part of my case, perfectly seriously and with as much conviction as the hon. Member for Stoke-on-Trent, South, the right hon. Member for Smethwick, or the hon. Lady the Member for Leeds, South-East (Miss Bacon), to make it perfectly clear that there are very good reasons why the Act was drawn like that by the Labour Government of the time and very good reasons why we should maintain the law in that condition.

The view has been expressed that, by concentrating on expenses incurred by individual candidates, the present law is unrealistic in present-day political circumstances. That was put by the right hon. Gentleman in his comprehensive speech as being a case which we should consider. We have considered it and we shall consider it. One debate is not enough to decide this issue.

At first sight, the argument has certain superficial attractions. It has been said in the debate that, by concentrating on the period of the election, the law ignores the importance of work done between elections, and we have heard a certain amount about the rival merits of Press advertising and other forms of political propaganda.

Indeed, the hon. Lady the Member for Leeds, South-East went further than anybody else and said that it was absolutely alien to British democracy to indulge in political advertising of the type She mentioned. I should have liked to think that Press advertising for political purposes was an innovation of the Conservative Party, but I have looked at the records of recent politics and I am told that credit for that innovation, which the hon. Lady described as alien to British democracy, should go to Lord Morrison of Lambeth who used Press advertising on a very extensive scale in connection with the L.C.C. elections in 1934.

Miss Bacon

What I said was alien to our British democracy was what the Tory Party did in putting itself into the hands of an advertising agency, Colman Prentis & Varley.

Mr. Butler

I should have thought that that argument, which I can describe only as nonsense, would have been shot away by the arguments of my right hon. Friend the Member for Blackpool, North (Sir T. Low). The Conservative Party has every right to use an agent, if it wants to do so, to undertake its advertising, because we have something good to offer, as has been proved by the results of the election; but to say that Conservative policy is in any way affected by this firm is absolute nonsense. The firm has nothing to do with policy and simply takes what is handed to it and puts it into the manner which it thinks most attractive.

By a combination of the agent and the principal, the principal being those who make Conservative policy, the matter is put before the British public in exactly the same way as Lord Morrison of Lambeth, one of the great political leaders of the party opposite, was the first to use political and Press advertising in this country. We must get these matters into some sort of proportion and some sort of understanding.

I want now to refer to the argument of the hon. Member for Stoke-on-Trent, South who said that all the activity before the election had been unconstitutional. However sincere he may be in this matter, I think that he, too, is exaggerating. Surely it is not unconstitutional in a democracy to take every opportunity of putting one's case before the public, and that is precisely what we have done.

At this stage, I draw the attention of the House to these facts. Any restriction on political action is so contrary to the whole spirit of our laws that we must constantly beware lest we infringe the essential freedom of speech and propagation of ideas. I quote in my support what I said not long ago at Question Time to the hon. Member for Orkney and Shetland (Mr. Grimond), the Leader of the Liberal Party. This is a quotation from a leading article in the News Chronicle of 9th June. We have had a variety of newspapers quoted and, in deference to the speech of the hon. Member for Devon, North (Mr. Thorpe) and his leader, I will now quote a Liberal newspaper which has some regard for the liberty of the subject and freedom.

It said: If a national limit on party expenditure is enforced, what about cmpaigns on specific issues like nationalisation and nuclear disarmament? The first is, and the second may become, identified with a political party: but is the citizen to be denied the right to spend money on propagating his views because they may affect the party struggle? And how is trade union support for Labour to be supervised? That represents the kernel of the perfectly serious problem which we have to consider as a result of right hon. and hon. Members opposite having initiated this debate.

The present law, it is true, involves a restriction on political activity and limits what a candidate can do or spend, or others spend on his behalf, to get himself elected. If we depart from that precise limitation, can we draw any other line which does not make nonsense of the freedom of speech? It has been suggested that as well as controlling what candidates spend at constituency level, the law should control what the political parties spend at the national level to promote their causes. That is what I referred to earlier as being superficially attractive.

Let us examine the consequences for British freedom of pursuing those ideas to their logical conclusion. I am bound to say that I cannot see how, in practice, such a provision could be enforced without some system of registering or incorporating political parties, which would involve a fundamental departure in British political practice with far-reaching consequences. I do not see, and I think that hon. Members of whatever political party will agree with me, how it would be possible in law to incorporate a political party. The only practical alternative to the present law seems to be the untenable proposition that political propaganda should be confined to politicians.

By that I mean that if we pass a law restricting expenditure on political activities, we have to draw the line somewhere, as I have said. Where do we draw the line? Is it between what is done by a political party and what is done by an outside body; between what is done by an affiliated body and what is done, for example, by the Nuclear Disarmament Campaign? Are we to regard the latter as political or not? Are we to regard splinter groups attacking the leadership of the right hon. Gentleman the Leader of the Opposition as being separate from him, or are we not? Are we to regard Tribune as an affiliate of the incorporated Labour Party, or are we not? Are we to regard the Trade Union Congress as political, affiliated as trade unions are to the Labour Party, or are we not?

All those questions arise and I am the last to say that I regret those opportunities for expression of opinion. Indeed, my whole thesis, speaking as I am as the Minister primarily responsible for the preservation of freedom in this country, is that the more we have of expression of opinion the better, and in what I am saying there is not a word of criticism of any of those things.

Much has been said about the expenditure of large sums of money. I read in the Press that last year Odhams Press subsidised the Daily Herald to the extent of some £225,000, in round figures, a figure which, incidentally, seems likely to increase rather than diminish in future. I mention it not because I have any objection, but only to show that I find it extremely difficult to see how one can frame a law which will include that, whether political parties are incorporated or not.

Mr. Gordon Walker

The right hon. Gentleman will find that the accounts were published.

Mr. Butler

They were published but not authenticated, because before the debate I made every effect to find the exact figure but was not able to do so, which was why I said that the figure was about £225,000 in round terms. Being fair, I did not want to be inaccurate, nor to give the impression that this was an authenticated figure.

A remark was made about the Cooperative movement. We have no idea of the expenditure of the Co-operative movement to support Reynolds News, or to what extent political activities are supported by Co-operative funds. I do not object to that. I simply say that I have no idea and that I do not want to pass a law which would be incapable of definition.

Mr. Hugh Gaitskell (Leeds, South)

Will the right hon. Gentleman agree that, difficult as it may be to draw these lines of distinction, they are in fact drawn under the existing law for the election period? If they can be drawn for that period, why should they not be drawn for a longer period?

Mr. Butler

The right hon. Member for Leeds, South (Mr. Gaitskell) missed the earlier part of my speech, which was of a serious character, intimating that they are not only limited to the period of the election. I listened carefully when the right hon. Member for Smethwick was speaking. He sought to achieve electoral limitations. The point of the present law, beyond which I cannot at present see a line which it is possible to draw, is that the expenses are attached to a candidate. That is the sense of the present law. If we go beyond that, I do not see how we can achieve sense or how we shall maintain freedom.

A good deal of fuss has been raised in the debate. I understand that perfectly. I do not object to the agitation. I am trying to indicate that it would be very difficult to draw the law in a new sense. To prohibit the expenditure of political parties would be as nothing in difficulty, compared with preventing expenditure by firms threatened, for example, by nationalisation, or, for that matter, trade unions spending money on protecting the policy they favour. To take legislative action to stop that would be very difficult.

This is a very dangerous proposal. The firms which engaged in the campaign against nationalisation sincerely believed that their system of ownership and control was better than the alternative of nationalisation. We on this side are against nationalisation. These firms were dead against nationalisation.

I would remind the House of a broadcast made by Mr. Herbert Morrison, as he then was, on 10th January, 1946, in which he said this: It is up to the nationalisers to prove their case that there will be public advantage by nationalisation. It is no less up to the anti-nationalisers to prove their case that the public interest can best be served by private ownership. The party opposite would have a great deal better Chance of getting back to power if its members were as definite on these matters as those people who want to save their own industries from nationalisation.

Mr. C. Pannell

Even if we concede the point so far, will the right hon. Gentleman deal with the short point that, if the nationalisers and anti-nationalisers are allowed to spend money, it would be in the interests of democracy for them to publish the amount of money spent?

Mr. Butler

I have not very long, because both the hon. Lady the Member for Leeds, South-East and I agreed not to be long. I have here the exact terms of the Act of 1913 dealing with trade unions, which I agree lay down a situation in Section 3. It is a very long Section which includes a definition of the type of political activity, but it also includes the words: without prejudice to the furtherance of any other political objects. It is extremely hard to define, even if one takes the trouble to examine the Statute with that reservation, how trade unions are limited in the great work that they do on behalf of the Labour Party in the political field.

I have been asked why there cannot be a similar regard for what companies do in relation to their shareholders. I refer the House with all sincerity to the investigation into company law being undertaken at present by Lord Justice Jenkins. We must await the conclusion of his Report, because this is part of the general remit to the Committee.

Mr. Gordon Walker

Is that covered?

Mr. R. A. Butler

It is covered. That is, in part, the answer to some of the apprehensions expressed today.

I do not want to detain the House on foreign experience, but I must honestly say that from what I have examined of foreign experience—whether in America, Norway or Sweden—it is extremely difficult to cite foreign experience in respect of this plan. Mr. Key, who wrote probably the most thoughtful book on American politics, parties and pressure groups, says this about the experiment in America: If the taws in force have any effect, they probably contribute to the disorganisation of the parties, help conceal the size and sources of campaign funds, and bring about a more immediate sense of indebtedness of candidates to donors … I do not want to see that sort of thing here. I do not believe that it is successful.

The Swedish Parliamentary Commission advised against any legislation to compel parties to publish accounts. That is in the Svenska Dagbladet of 1951, Volume 121, According to the same source, which I have looked up, the Parliamentary Commission rejected the idea that political parties should be compelled either to publish regular accounts or to account for expenditure on electoral propaganda. The same is true of Norway, where the Royal Commission advised against compulsory publication. Therefore, I must cite foreign experience as being extremely unfriendly to the ideas put forward by right hon. and hon. Members opposite.

I think that in the short time at my disposal I have managed to give some answer to the points raised by right hon. and hon. Gentlemen opposite, but I do not wish to avoid, even in these last few minutes, their challenge that we should publish accounts. In speaking of this matter, I am led to examine what happens when accounts are published. My right hon. Friend the Member for Blackpool, North drew attention to the fact that in the Liberal Party accounts of 1958 the party revenue is shown as only £21,774. This is how £20,558 of it is described—"donations and subscriptions". We do not learn very much from that.

Mr. Thorpe

Will not the right hon. Gentleman agree that that certainly goes further than the practice of the Conservative Party? Is he aware that, if he wanted further details, they would be readily available to him or anyone making a request?

Mr. Butler

This debate may lead to a very agreeable interview between myself, the hon. Member for Devon, North and his friends. As for the accounts of the Labour Party—this shows how foreign experience is not much at variance in this—the Labour Party accounts, which I have examined as closely as I can, do not include the income and expenditure of constituency Labour parties, the revenue of which was estimated by the former hon. Member for Reading, Mr. Mikardo, in 1955, at nearly £1 million. They do not include the large balance of the political funds of trade unions, used to finance the election of more than one-third of the Parliamentary Labour Party. They do not include the similar expenditure of the Co-operative Party, used to finance Labour Parliamentary candidates. Nor do they include expenditure by the unions or the Co-operative Party on what is broadly described as "political education."

While I do not doubt that right hon. and hon. Members opposite imagine that they are doing as much as they can to make their accounts a reality, I assure them that the accounts of both the Labour Party and the Liberal Party are simply not a reality. I do not believe that they add anything to what we know or what we should know.

My conclusion is the same as my opening remarks. The debate has aired a grievance. It will, to that extent, have done good. As the Minister responsible for electoral law, I will undertake, as I said in my opening remarks, to follow up the points raised by the right hon. Member for Smethwick and continue, in the words of the book on the election, which has been discussed so much, to see that the situation is properly examined.

In response to the arguments which have been raised, I can only put forward our impression, which is a very fair one and one backed by foreign

experience, that it would be contrary to freedom to try to incorporate political parties. It would be contrary to freedom to enlarge the boundaries of the present Act without further examination. In the circumstances, we have absolutely no alternative to opposing the Motion.

Mr. Gordon Walker

Before the right hon. Gentleman completes his speech, will he tell us what he means by a proper examination? Would not a proper examination include some participation by the other two parties in the House?

Mr. Butler

As I said in my opening remarks, if right hon. and hon. Members opposite wanted to submit any case to me—which, I suggest, should be rather more watertight than the case they have put this afternoon—I would consider it.

Mr. John Rankin (Glasgow, Govan)

Mr. Speaker, in the few remaining seconds, perhaps I may tell the right hon. Gentleman that the Co-operative Party's accounts are published separately from the Labour Party accounts, and that he can have a copy if he is interested.

Question put, That the words proposed to be left out stand part of the Question:—

The House divided: Ayes 265, Noes 181.

Division No. 143.] AYES [7.1 p.m.
Agnew, Sir Peter Campbell, Sir David (Belfast, S.) Duncan, Sir James
Aitken, W. T. Campbell, Gordon (Moray & Nairn) Duthie, Sir William
Allan, Robert (Paddington, S.) Carr, Compton (Barons Court) Eden, John
Allason, James Cary, Sir Robert Emery, Peter
Alport, Rt. Hon. C. J. M. Channon, H. P. G. Emmet, Hon. Mrs. Evelyn
Amery, Julian (Preston) Chataway, Christopher Errington, Sir Eric
Arbuthnot, John Chichester-Clark, R. Farey-Jones, F. W.
Ashton, Sir Hubert Clark, Henry (Antrim, N.) Farr, John
Atkins, Humphrey Clark, William (Nottingham, S.) Fell, Anthony
Balniel, Lord Cole, Norman Fletcher-Cooke, Charles
Barter, John Collard, Richard Foster, John
Batsford, Brian Cooper, A. E. Fraser, Hn. Hugh (Stafford & Stone)
Bell, Ronald (S. Bucks.) Cooper-Key, Sir Neill Fraser, Ian (Plymouth, Sutton)
Berkeley, Humphry Cordeaux, Lt.-Col. J. K. Freeth, Denzil
Bevins, Rt. Hon. Reginald (Toxteth) Cordie, John Gammans, Lady
Bidgood, John C. Corfield, F. V. Gardner, Edward
Biggs-Davison, John Costain, A. P. Gibson-Watt, David
Bingham, R. M. Coulson, J. M. Glover, Sir Douglas
Bishop, F. P. Courtney, Cdr. Anthony Glyn, Dr. Alan (Clapham)
Black, Sir Cyril Craddock, Sir Beresford Glyn, Sir Richard (Dorset, N.)
Bossom, Clive Critchley, Julian Goodhart, Philip
Bourne-Arton, A. Crosthwaite-Eyre, Col. O. E. Goodhew, Victor
Box, Donald Crowder, F. P. Green, Alan
Boyd-Carpenter, Rt. Hon. John Cunningham, Knox Grimston, Sir Robert
Boyle, Sir Edward Curran, Charles Hall, John (Wycombe)
Braine, Bernard Currie, G. B. H. Hamilton, Michael (Wellingborough)
Brewis, John Dalkeith, Earl of Harris, Frederic (Croydon, N.W.)
Bromley-Davenport, Lt.-Col. W. H. Dance, James Harris, Reader (Heston)
Brooman-White, R. d' Avigdor-Goldsmid, Sir Henry Harrison, Brian (Maldon)
Browne, Percy (Torrington) Deedes, W. F. Harvey, Sir Arthur Vere (Macclesf'd)
Bryan, Paul de Ferranti, Basil Harvey, John (Walthamstow, E.)
Bullard, Denys Digby, Simon Wingfield Harvie Anderson, Miss
Bullus, Wing Commander Eric Doughty, Charles Hay, John
Butler, Rt. Hn. R. A.(Saffron Walden) Drayson, G. B. Heald, Rt. Hon. Sir Lionel
Hendry, Forbes Macmillan, Rt. Hn. Harold (Bromley) Scott-Hopkins, James
Hicks Beach, Maj. W. Macmillan, Maurice (Halifax) Sharples, Richard
Hiley, Joseph Madden, Martin Shaw, M.
Hill, Dr. Rt. Hon. Charles (Luton) Maitland, Sir John Shepherd, William
Hill, Mrs. Eveline (Wythenshawe) Manningham-Buller, Rt. Hn. Sir H. Skeet, T. H. H.
Hill, J. E. B. (S. Norfolk) Marlowe, Anthony Smith, Dudley(Br'ntf'rd & Chiswick)
Hinchingbrooke, Viscount Marshall, Douglas Smithers, Peter
Hirst, Geoffrey Marten, Neil Smyth, Brig. Sir John (Norwood)
Hocking, Philip N. Mathew, Robert (Honiton) Spearman, Sir Alexander
Holland, Philip Matthews, Gordon (Meriden) Speir, Rupert
Hopkins, Alan Mawby, Ray Stanley, Hon. Richard
Hornby, R. P. Maydon, Lt.-Cmdr. S. L. C. Stevens, Geoffrey
Hornsby-Smith, Rt. Hon. Patricia Mills, Stratton Steward, Harold (Stockport, S.)
Howard, Gerald (Cambridgeshire) Molson, Rt. Hon. Hugh Stodart, J. A.
Howard, Hon. G. R. (St. Ives) Montgomery, Fergus Studholme, Sir Henry
Howard, John (Southampton, Test) Morgan, William Summers, Sir Spencer (Aylesbury)
Hughes Hallett, Vice-Admiral John Morrison, John Sumner, Donald (Orpington)
Hughes-Young, Michael Mott-Radclyffe, Sir Charles Tapsell, Peter
Hulbert, Sir Norman Neave, Airey Taylor, Sir Charles (Eastbourne)
Hurd, Sir Anthony Nicholson, Sir Godfrey Teeling, William
Hutchison, Michael Clark Noble, Michael Thomas, Leslie (Canterbury)
Iremonger, T. L. Nugent, Sir Richard Thomas, Peter (Conway)
Irvine, Bryant Godman (Rye) Ormsby-Gore, Rt. Hon. D. Thompson, Richard (Croydon, S.)
Jackson, John Orr, Capt. L. P. S. Thorneycroft, Rt. Hon. Peter
James, David Osborn, John (Hallam) Thornton-Kemsley, Sir Colin
Jenkins, Robert (Dulwich) Osborne, Cyril (Louth) Tiley, Arthur (Bradford, W.)
Jennings, J. C. Page, John (Harrow, West) Tilney, John (Wavertree)
Johnson, Dr. Donald (Carlisle) Page, Graham Turner, Colin
Johnson, Eric (Blackley) Pannell, Norman (Kirkdale) Turton, Rt. Hon. R. H.
Kaberry, Sir Donald Partridge, E. van Straubenzee, W. R.
Kerans, Cdr. J. S. Pearson, Frank (Clitheroe) Vaughan-Morgan, Sir John
Kerby, Capt. Henry Peel, John Vosper, Rt. Hon. Dennis
Kerr, Sir Hamilton Percival, Ian Wakefield, Sir Wavell (St. M'lebone)
Kershaw, Anthony Pickthorn, Sir Kenneth Walker-Smith, Rt. Hon. Derek
Kirk, Peter Pitman, I. J. Wall, Patrick
Lambton, Viscount Pitt, Miss Edith Watkinson, Rt. Hon. Harold
Lancaster, Col. C. G. Pott, Percivall Watts, James
Langford-Holt, J. Powell, J. Enoch Webster, David
Leavey, J. A. Price, David (Eastleigh) Wells, John (Maidstone)
Leburn, Gilmour Price, H. A. (Lewisham, W.) Whitelaw, William
Legge-Bourke, Sir Harry Prior-Palmer, Brig. Sir Otho Williams, Dudley (Exeter)
Lewis, Kenneth (Rutland) Profumo, Rt. Hon. John Williams, Paul (Sunderland, S.)
Lilley, F. J. P. Proudfoot, Wilfred Wills, Sir Gerald (Bridgwater)
Linstead, Sir Hugh Redmayne, Rt. Hon. Martin Wilson, Geoffrey (Truro)
Litchfield, Capt. John Rees, Hugh Wise, A. R.
Lloyd, Rt. Hn. Geoffrey (Sut'nC'dfield) Renton, David Wolrige-Gordon, Patrick
Longbottom, Charles Ridley, Hon. Nicholas Woodhouse, C. M.
Longden, Gilbert Ridsdale, Julian Woodnutt, Mark
Low, Rt. Hon. Sir Toby Roberts, Sir Peter (Heeley) Woollam, John
Lucas-Tooth, Sir Hugh Robinson, Sir Roland (Blackpool, S.) Worsley, Marcus
McAdden, Stephen Robson Brown, Sir William Yates, William (The Wrekin)
MacArthur, Ian Roots, William
McLaren, Martin Ropner, Col. Sir Leonard TELLERS FOR THE AYES:
McLaughlin, Mrs. Patricia Royle, Anthony (Richmond, Surrey) Mr. Edward Wakefield and
Macleod, Rt. Hn. Iain (Enfield, W.) Russell, Ronald Colonel J. H. Harrison.
McMaster, Stanley R. Sandys, Rt. Hon. Duncan
Ainsley, William Cullen, Mrs. Alice Griffiths, W. (Exchange)
Albu, Austen Darling, George Grimond, J.
Allaun, Frank (Salford, E.) Davies, G. Elfed (Rhondda, E.) Hale, Leslie (Oldham, W.)
Awbery, Stan Davies, Harold (Leek) Hall, Rt. Hon. Glenvil (Colne Valley)
Bacon, Miss Alice Davies, Ifor (Gower) Hannan, William
Beaney, Alan Davies, S. O. (Merthyr) Hart, Mrs. Judith
Bellenger, Rt. Hon. F. J. Deer, George Hayman, F. H.
Benn, Hn. A. Wedgwood (Brist'IS. E.) de Freitas, Geoffrey Healey, Denis
Benson, Sir George Dempsey, James Henderson, Rt. Hn. Arthur(Rwly Regis)
Blackburn, F. Diamond, John Herbison, Miss Margaret
Blyton, William Dodds, Norman Hill, J. (Midlothian)
Bowden, Herbert W. (Leics, S.W.) Driberg, Tom Hilton, A. V.
Boyden, James Dugdale, Rt. Hon. John Holman, Percy
Braddock, Mrs. E. M. Ede, Rt. Hon. Chuter Houghton, Douglas
Brockway, A. Fenner Edwards, Walter (Stepney) Howell, Charles A.
Brown, Alan (Tottenham) Evans, Albert Hughes, Emrys (S. Ayrshire)
Brown, Rt. Hon. George (Belper) Finch, Harold Hunter, A. E.
Brown, Thomas (Ince) Fletcher, Eric Hynd, H. (Accrington)
Butler, Herbert (Hackney, C.) Forman, J. C. Hynd, John (Attercliffe)
Butler, Mrs. Joyce (Wood Green) Fraser, Thomas (Hamilton) Irvine, A. J. (Edge Hill)
Callaghan, James Gaitskell, Rt. Hon. Hugh Janner, Barnett
Castle, Mrs. Barbara Ginsburg, David Jay, Rt. Hon. Douglas
Corbet, Mrs. Freda Gooch, E. G. Johnson, Carol (Lewisham, S.)
Craddock, George (Bradford, S.) Gordon Walker, Rt. Hon. P. C. Jones, Rt. Hn. A. Creech (Wakefield)
Cronin, John Gourlay, Harry Jones, Dan (Burnley)
Crosland, Anthony Grey, Charles Jones, Elwyn (West Ham, S.)
Crossman, R. H. S. Griffiths, Rt. Hon. James (Llanelly) Jones, J. Idwal (Wrexham)
Kelley, Richard Oram, A. E. Spriggs, Leslie
Kenyon, Clifford Oswald, Thomas Steele, Thomas
Key, Rt. Hon. C. W. Owen, Will Stewart, Michael (Fulham)
King, Dr. Horace Paget, R. T. Storehouse, John
Lawson, George Pannell, Charles (Leeds, W.) Stones, William
Lee, Frederick (Newton) Pargiter, G. A. Strachey, Rt. Hon. John
Lever, L. M. (Ardwick) Parker, John (Dagenham) Strauss, Rt. Hn. G. R. (Vauxhall)
Lewis, Arthur (West Ham, N.) Parkin, B. T. (Paddington. N.) Stross, Dr. Barnett(Stoke-on-Trent, C.)
Lipton, Marcus Pavitt, Laurence Summerskill, Dr. Rt. Hon. Edith
Mabon, Dr. J. Dickson Peart, Frederick Swain, Thomas
McCann, John Plummer, Sir Leslie Swingler, Stephen
MacColl, James Popplewell, Ernest Symonds, J. B.
McInnes, James Prentice, R. E. Taylor, John (West Lothian)
McKay, John (Wallsend) Proctor, W. T. Thomas, George (Cardiff, W.)
Mackie, John Pursey, Cmdr. Harry Thompson, G. M. (Dundee, E.)
McLeavy, Frank Rankin, John Thornton, Ernest
Mahon, Simon Reid, William Thorpe, Jeremy
Mallalieu, E. L. (Brigg) Reynolds, G. W. Tomney, Frank
Manuel, A. C. Roberts, Albert (Normanton) Wainwright, Edwin
Mapp, Charles Roberts, Goronwy (Caernarvon) Warbey, William
Marquand, Rt. Hon. H. A. Robinson, Kenneth (St. Pancras, N.) Weitzman, David
Marsh, Richard Ross, William Wells, Percy (Faversham)
Mayhew, Christopher Royle, Charles (Salford, West) White, Mrs. Eirene
Mellish, R. J. Short, Edward Whitlock, William
Mendelson, J. J. Silverman, Julius (Aston) Wilkins, W. A.
Millan, Bruce Silverman, Sydney (Nelson) Willey, Frederick
Mitchison, G. R. Skeffington, Arthur Williams, Rev. LI. (Abertillery)
Monslow, Walter Slater, Mrs. Harriet (Stoke, N.) Williams, W. R. (Openshaw)
Moody, A. S. Slater, Joseph (Sedgefield) Winterbottom, R. E.
Morris, John Small, William Woof, Robert
Mort, D. L. Smith, Ellis (Stoke, S.) Wyatt, Woodrow
Moyle, Arthur Snow, Julian Zilliacus, K.
Mulley, Frederick Sorensen, R. W.
Oliver, G. H. Soskice, Rt. Hon. Sir Frank TELLERS FOR THE NOES:
Dr. Broughton and Mr. Redhead.

First Resolution read a Second time.

Main Question again proposed.

Mr. Michael Hughes-Young (Lord Commissioner of the Treasury)

I beg to ask leave to withdraw the Motion.

Motion, by leave, withdrawn.

Committee tomorrow.

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