HL Deb 15 May 1974 vol 351 cc1020-47

3.22 p.m.

VISCOUNT MASSEREENE AND FERRARD rose to draw the attention of Her Majesty's Government to the desirability of introducing State financing of political Parties; and to move for Papers. The noble Viscount said: My Lords, I beg to move the Motion standing in my name on the Order Paper. It may surprise some of your Lordships that I have put down this Motion, because on the whole I am not renowned for recommending the State-financing of our institutions. Neither have I any totalitarian tendencies; but I must say, having returned only yesterday from the Isle of Mull, where the State-controlled sea and road transport services have just increased their rates by a further 25 per cent.—having already increased them not so long ago—putting the residents into real despair, that I am sure your Lordships will agree with me when I say that any leanings I may have had towards totalitarianism have gone into reverse.

My Lords, I should have preferred this Motion to come from the Cross-Benches. A few months ago, during the period of office of the last Government, the noble Lord, Lord O'Hagan—I do not even know whether he is here—had a Motion down in somewhat the same terms as mine. I spoke to him about it, but he did not seem anxious to proceed with it, so I think I am rather the fool stepping in where angels fear to tread. My noble friend Lord Carrington, the Chairman of my Party, may be rather surprised that I have not discussed this Motion with my Party, or in fact with any Party, the reason being that I wanted to keep a completely open mind on this matter—and, you never know, I might have been discouraged. But personally, my Lords, I have for several years believed that the advantages of State financing of political Parties would outweigh the disadvantages. I am quite prepared after having heard this debate to admit that I may be completely wrong, but until I have heard the other speakers, including my noble friend in front of me, I shall stick by that opinion.

My Lords, we in this country have always prided ourselves—and I think quite rightly—on our high standards of public life; that is, public life throughout the whole country, not only in politics. We have also prided ourselves on the fairness of our political system. I quite agree that the Liberal Party might have some reservations on this, but compared with the rest of the world I think we are entitled to think thus. Admittedly, recently there appear to have been some slight departures from this high standard in the realm of local government, but we should be careful not to make mountains out of molehills. What is surely obvious is that politicians, and the Parties to which they belong, should be removed as far as possible from outside financial pressures.

For instance, how often does one hear from some that the Conservative Party is the Party of big business? I completely refute that suggestion, because, of course, we are a great national Party and we draw our support from the whole strata of society. We also hear that the Labour Party is in the financial pockets of the trade unions. Whatever the truth or otherwise of these allegations, any arrangement that could be made to nullify them would be beneficial to public life. If these accusations had any truth in them—and, who knows, there may be an element of truth—many Labour politicians might be only too thankful to be rid of union purse strings if they had an assured income from elsewhere, from the State. Similarly, there might be some Conservative politicians—though, as I say, I refute the suggestion that the Conservative Party is the Party of big business—who felt likewise about big business. Where the Liberal gets his money from, I have no idea. I can only presume that there must be one or two fairy god- mothers floating around and, if that is so, I am sure the Liberal Party would be only too pleased to dispense with them—and no doubt the fairy godmothers would be very relieved.

I do not think that people outside politics understand the prodigious efforts that go on through the branches to raise money for the Parties. Having been treasurer of a constituency some time ago, I have some slight practical experience of this. The idea of financing political Parties out of the Exchequer is not a new one; I understand that it is done in one or two democratic countries. For instance, it is the custom in Germany. This can be done in various ways, but I would favour a system in which every Party received an annual income based on the number of votes cast for them at the previous General Election. Of course, this system could not apply to all Parties. A Party must have had a minimum of 5 per cent. of the total vote of the electorate; or perhaps the figure ought to be 7 per cent. Otherwise, if you had it for all Parties irrespective of their performance at a General Election, you would get all the cranky Parties, you would get eccentrics and you would get lots of Parties wanting to jump on the cash band wagon. So you could not have that.

I suppose that people will say, "Oh! the Exchequer will never hear of it. The Treasury will kill it." If you take the fact that the United Kingdom electorate numbers about 40 million, then, if the political Parties were given £5 million annually split according to their percentage of the General Election vote, it would cost the electorate 12½p per head; in other words, 2s. 6d. Equally, if the Parties were to get £10 million a year, it would cost only 25p or 5s. 0d. a head; in other words, less than a packet of cigarettes a head. That is really a very small tax. I do not know what it costs to run political Parties, but I am sure that it does not cost £10 million a year—although I may be wrong. If some such system were adopted, the Parties receiving such money would be debarred from receiving income from any other source—that would not apply, however, to the Parties which did not get 5 per cent. of the total vote—and their accounts would need to be published.

I feel that such a system would have certain advantages. It would destroy the temptation—though I do not know whether it exists—for Parties to accept a large donation from a millionaire, whether on the Left or on the Right of politics, or from some big financial institution, in order that some individual be offered the candidature of a safe seat. I do not think that happens, though I suppose the temptation is there. It is unthinkable, but—one never knows—a job might even be offered in your Lordships' House! I have no knowledge of such things, but I am quite sure that that is unthinkable. True, the individual might make a very good Member or a very good Minister. On the other hand, he might not and the country would then be the loser. Such a system would also somewhat inhibit the unions—though not entirely—from forcing the candidature of one of their members.

In the field of education the poorest in the community if blessed with the natural ability, can rise to the highest academic standards in this country. The same is broadly true of politics in this country. I do not think that the lack of wealth debars a man from rising to the highest position in politics. If the political Parties did not have a need to raise large sums of money from diverse sources, that would ensure even greater fairness than already exists in political life. We have come a long way from the days of Walpole and Lloyd George, and his henchman Maundy Gregory—I see that a book about him has just come out—but there must be a temptation to any political Party if they find their coffers empty. That temptation exists. I shall not go further than that.

The other advantage of this system is that it would obviate the necessity for those very public-spirited, and excellent people who organise functions to raise money for the Parties of their faith. They are most tireless and praiseworthy, but if we had this system their very unselfish energies could be directed to helping their Parties in other ways. It is always very embarrassing to ask for money—it is embarrassing for the asker and rather tiresome for the giver.

Before ending, I should just like to say that I realise that political Party financing is a delicate subject and I hope that I have not trodden on any political corns. If I have done so, I apologise. I am pleased to see the Chairman of our Party will be speaking, and I hope that I shall learn whether there are any dangers in a system such as I have suggested. We tend to move slowly in this country, and perhaps that is wise when considering changing from long-established customs, political or otherwise. But I cannot help feeling that, though this debate is the merest of political canters, one day something akin to what I have suggested will come to pass. I beg to move for Papers.

3.37 p.m.


My Lords, I am most grateful indeed to the noble Viscount, Lord Massereene and Ferrard, for having introduced this subject to-day. It is a very interesting and a very important subject, and one that I have had cause to think about for some time. I have had experience of being in charge of the political machine of the Liberal Party, both in an amateur capacity and, for a short time, in a professional capacity, and I know something of what the problems are. I also know that, contrary to what some people think, this kind of problem is certainly not the sole province of the Liberal Party and, even in comparative terms, may not be worse in the Liberal Party than in other Parties.

I start from a basis of putting forward—I hope your Lordships will not think too sententiously—a thought or two about our need to protect the democratic system in this country. If I may quote the words of Sir Robert Fraser: Only a very few people for a very brief time have been able to govern themselves, a tiny proportion of the world's population for a tiny proportion of the centuries of history. I see that even to-day democracy, a word that half the world has stolen, and other parts do not even bother to appropriate, is safely and successfully practised by only a small group of nations. … This has deepened my sense that self-government is the happiest of all human achievements but also my sense that it is a rare flower of man's total accomplishment, and that those of us who tend it had better be conscious not only of its beauty, for human freedom is beautiful, and in danger if we do not feel it to be so, but also, in the long tides of history, of its fragility. That may seem a rather high-flown introduction to a talk about cash, but I do not think I need to persuade your Lordships in this House that, like it or not, democracy is tied up with the Party system. There are many things wrong with the Party system as it is practised, but no one has yet found a better alternative and we should do well, if we wish to cherish democracy, to look after the Party political system and see that it works as well as possible. To take an example slightly outside the realm of this debate I believe that, rather than having fewer Party political broadcasts, there should be more. One of the reasons why Party political broadcasts tend to be rather bad—and I have had experience of trying to organise them—is that there are so few, and that people are trying to get a complicated and detailed message over in a very short period of time without sufficient expertise and experience.

This would all be corrected if we gave to the political Parties more time to themselves—not necessarily on all channels—in which to explain their points of view in a way which, with the best will in the world, cannot be done in a discussion or any other kind of programme. I do not think we should be afraid of being a little paternalistic about Party politics. I think in the matter of broadcasting it would be quite right to insist on a certain amount more rather than less time being given to the political Parties. Equally, I do not think we need to be afraid of being paternalistic in the way of money and of financing political Parties.

The low standard of Party politics—and I use "low standard" in comparative terms: comparative to what it could be and not necessarily comparative to other countries—is, I think, to a certain extent dependent not only upon the shortage of money in all political Parties, but shortage of money in political Parties as opposed to the riches in the possession of the vested interests. Gladstone said, "The interests are always awake, while the country often slumbers or sleeps". To-day the interests are far, far richer than the political Parties, in addition to which they are always trying to take over the political Parties. Something of which the Conservative Party can be proud is that, on the whole, it has not allowed itself to get too much taken over by the City and by the financial interests. The Labour Party is in far greater danger to-day with the unions than any other Party has ever been.

Although there will be many who will disagree with me, fundamentally the basis of political Parties is not, nor I believe should it be, one of interest. The basis of political Parties is one of philosophy. There is a very real philosophy which separates noble Lords on those Benches and noble Lords on these Benches. It has nothing, or not all that much, to do with what part of the community we are drawn from. I think it is for us to keep these philosophies in front of people so that politics is not just dismissed as a grabbing game; but is seen to be about real and fundamental issues.

All Parties are relatively poor. It goes without saying that the Liberal Party is poor, but we are possibly the nearest to living up to our means because we have never expected very much. I understand that over the last 10 years the Conservatives have been running at a very serious deficit—though the noble Lord, Lord Carrington, will no doubt correct me if I am wrong. It is a deficit which must run very deeply into their reserves. The present Stock Market slump cannot have done them much good either. The Labour Party, it has been said by its present Leader, used to run a penny-farthing machine, and I have seen no signs that it has improved very much over a period of time. As badly off as we were during the last Election, it was really appalling in my view that so big a national Party as the Labour Party was not able to field very many full-time professional agents. I think I am right in saying that in 1970 there were 140 full-time Labour agents. I do not think that number has increased since.

We need this money because political Parties need to be organised, and maybe that money comes best from voluntary gifts. But I think there is a very real sense in which the whole community needs political Parties to do more and better research. There are various suggestions being put forward by the present Government which may help the Opposition Parties in this way. I very much hope that this comes to fruition because, as we all know, an Opposition Party when it comes into power is at a very great disadvantage in terms of what it has been able to plan in terms of alternative policies. This, of course, could be one reason why the public think that policies and pledges put forward at a General Election are so often broken. Sometimes I feel that those policies are put forward on a basis of misunderstanding. There is in fact a great need for help for the political Parties both in Parliament and outside Parliament. One could say, for instance, that a little more research at Conservative Central Office might have saved the noble Lord, Lord Carrington, embarrassment when some of his colleagues during the General Election were saying that the Liberal Party had no policies and others were saying that the policies they had were bad, and the noble Lord, Lord Carrington, was at the same time trying to tell potential Liberal voters that in fact Liberal policies were the same as the Conservative policies. With a few more researches at Central Office contradictions of this kind could probably be done away with.

How is this need for money to be satisfied? The noble Viscount, Lord Massereene and Ferrard, mentioned the temptations. I do not think we should skip over these; they are very real. No one knows this more than this Party which had as its Leader at one time Lloyd George of whom the noble Lord, Lord Blake, said, History has yet to reveal—perhaps it never will fully reveal—the measure of corruption which Lloyd George permitted to enter politics during his six years as Prime Minister. I would not dissent from that.

One other interesting observation of Lloyd George comes out in the book which has just come out on Maundy Gregory. Lloyd George said to the noble Viscount, Lord Davidson, when talking about political finance You and I know that the sale of honours is the cleanest way of raising money for a political Party. This may seem to be a contradiction; but it is not in fact a contradiction because, except that it may mean the appointment of some unsuitable Members to your Lordships' House, the honours system really does not make much sense anyway, and the perversion of it does not do all that amount of harm—not nearly so much harm as selling policies for money, selling policies because you need money from the people who are giving it. That is a much more subtle and dangerous form of corruption.

So, my Lords, I am driven to believe that it is in the general interest that political Parties should to a certain extent be financed by the community, by Gov- ernment; that we should have taxation to support democracy. There is surely nothing wrong in that. There are many systems probably in proportion to votes, though I have never been able to see why the validity of a general philosophy put forward by a political Party necessarily has any bearing. Its importance is governed by the number of votes it attracts; but I think you probably would have to do it in proportion to votes. You would probably need to have a threshold. I think you should be careful about the threshold. A 5 per cent. threshold, which the noble Viscount, Lord Massereene and Ferrard, mentioned for instance, would bear differently on a United Kingdom Party than it would on the Scottish or Welsh nationalists. One must be very careful not to be unfair to minority Parties which represent particular parts of the country.

As has been said, there have already been more than experiments conducted in this field. In Norway, in Sweden and West Germany there exist various ways of financing political Parties by the State. In France, Canada and the U.S.A. experiments are being tried. It would not cost all that much, comparatively speaking. The noble Viscount, Lord Massereene and Ferrard, suggested a sum which is necessary to run political Parties. I believe it is true that Professor Richard Rose has estimated that £3½ million a year is required to support a really properly run political Party which would be able to do its homework, its research and be able to produce the right kind of policies to put before the country. If you have something of that kind it would then be right to put a limit on corporate gifts of every kind, and a limit on the size of gifts given by anyone, whether individuals or corporate bodies. Such a move would strengthen the political and democratic life of this country, and I very much hope that the Government will seriously consider it.

3.50 p.m.


My Lords, I must begin by declaring an interest. I am at present Chairman of a Political Party. I must also declare with total certainty that I have gained no material advantage from this position, though I daresay the spiritual rewards are considerable—or perhaps they will be later. I am sure we are all grateful to my noble friend for having raised this matter and for the thoughtful way in which he presented his arguments. It is very timely that we should be having this discussion, just as the bills for the Election—and for the moment I am not referring to the Government's policies, because the Bills for those will come later—come rolling in. Like everything else, political activities have been battered by inflation and, what is worse, Political Parties (like the Royal Opera House and the National Theatre) have no way of raisng productivity to meet rising costs. There is an ever-increasing income gap, which can be bridged only by very substantial fundraising efforts. I must say that I am fairly familiar with these. I started my political career as a constituency treasurer; and, in a way, there is a moral in that because I have been demobilised and in my constituency no one had ever approached me for a subscription to the Conservative Party or asked me to do any work for it. I wrote a letter of indignation to the local chairman—and one week later I was the treasurer! I should have listened to my father, who said, "Never put things down in writing".

What is frightening about fund raising is that each time one goes out one has to raise more money. The figure needed is more than it was before, and very often it is correspondingly more difficult to raise. As the figures published by the Conservative Party show, the Central Office spends each year a very considerable sum. That, of course, is not the total of Conservative Party activities. There is a great deal of locally-funded work in every constituency, and all this money has to be found from voluntary contributions: a great deal comes from door-to-door collecting. This is only the Conservative Party's share of the cost, voluntarily raised, of political activity in this country.

Few people would deny what the noble Lord, Lord Beaumont of Whitley, said: that Political Parties are essential to our Parliamentary democracy. Indeed, I agreed with the first part of his speech, though I must tell him that it will not be necessary to increase the staff of the Conservative Party's research department to enquire into the policies of the Liberal Party. Whether they are there or not there, or whether they are contradictory, the fact remains that their effect has been to elect a minority Labour Government. I do not know whether that is what was intended. But a Parliamentary Political Party must have some kind of cerebral activity as well as organisational ability. The ideas, researched and refined by the professionals in the Party organisations themselves, form the basis for the Manifestos on which the Parties seek to be elected and which they place in front of an astonished and sceptical Civil Service on the morning after they are elected. The people who help to produce these ideas, quite rightly, cost more and more money.

Then there is all the bread-and-butter work of political life—the distribution of Election addresses, the organising of meetings, the canvassing and so on—all of which we regard more or less as essential parts of the political process. People expect the Parties to do all this, but on the whole they do not recognise how much it costs and how much effort goes into raising the money. Yet, like the noble Lord, I believe that the work is essential and it is bad for our system of democratic Government if basic political work is frustrated by shortage of money. Let me give one example of what I mean. I know a good deal about the work of our local Party agents. Of course, I cannot speak for the other Parties, but I am sure that if the Chairman of the Labour Party were here he would endorse what I am saying from his own point of view. I know that our agents play an absolutely vital role in the local democratic machinery. They have a key part in the life of the community and in the running of a democracy. Since I have been Chairman of my Party, I have regarded it as a very important task to see that our agents are reasonably paid for their work and have a proper career structure. A fair deal for them is an expensive business. No Party can expect to survive on loyalty alone, and if its paid servants are not treated decently we shall all lose one of the cornerstones of our democratic system.

What is the answer to all this? First, I think it should be said that on the whole in this country people get their politics "on the cheap". I make no apology for saying that, on the whole, those who contribute to Political Parties are less generous than they should be and those who do not contribute at all should pause to think before they grumble when an Election address does not arrive, or, for that matter, when the side they do not like wins the Election. But there is a world of difference between saying that people should give us more and actually banking the increased contributions.

The problem has been met in some other countries by direct State subsidies. So far as I know, the difficulty of fund raising is not usually given as the main reason for this. In America, for example, when there is a discussion about financing the next Presidential Election from public funds, there are other considerations, which have received some coverage in the newspapers. We have been fortunate in this country that for some time now political fund-raising has not been abused, although we are advised by the noble Lord, Lord Beaumont, that that was not always so—indeed, at one point I thought that the noble Lord, Lord Beaumont, was on the verge of saying that he would do it again if he ever got the opportunity—but I hope he will have second thoughts about that! In Sweden, I am told, one of the main reasons for State financing was to help the Press which is closely associated with the political Parties. When Dr. Adenauer introduced State subsidies in West Germany in 1959, one intention was to increase the independence of the Parties from pressures by their financial supporters.

The methods of State financing, in the half-dozen Western European countries where it is the practice, vary fairly substantially, like the pretexts for its introduction. In some countries, the Parties receive a grant based on the total vote for a Party, and in others the grant is based on the number of Members of Parliament who are selected. What is pretty clear is that there is no system that we could transpose straight away to this country, if we wished, without great difficulty and without much debate. But that is to assume that paying for more of our political work through State funds would be desirable in principle. However important it is to raise more money to sustain political activity at an adequate level, there are strongly held and very substantial arguments against moving further down that road.

First of all, I think it is fair to argue that one of the useful points about Political Parties is that they are independent of the State and perhaps they provide, both in theory and in practice, a useful countervailing force to the growing power of State bureaucracy. It might be that the distinction between the Political Party and the institutions of the State could become blurred if the State were to become the major paymaster of the Parties. There are those who argue that Political Parties are not independent at the moment. I think that argument is greatly overdone and I do not agree with it. It very much depends on who is leading the Parties, and on their own internal political situation; but even then I do not think that the real decisions in Government in the past have been taken with an eye on the Party coffers.

It seems to me perfectly reasonable for a company to give money to a Party which it thinks would run the country in a way beneficial to its activities and to its shareholders. Similarly, I see no reason why trade unions should not do the same—though I am sure that many of your Lordships would have some reservations about the precise mechanics of the political levy. I can only speak for the impact of this private fund raising on the Conservative Party. I must assert that never has our independence been compromised in any way. I would not, perhaps, be quite so sanguine on this point if, say, businesses which contributed to our Party had a major say in the election of candidates. But that would be an institutional rather than a financial problem.

Another argument against State financing is that with an unwritten Constitution we are in a rather different position from that in other countries. One can, for example, conceive of circumstances in which one Government would switch on the flow of funds to political Parties and its successor would turn off the tap. That would create all kinds of strains and difficulties. But the most substantial argument is that the basis of political work in this country is the work of local political Parties for whom fund-raising is often an important dynamic. It should not be their sole purpose in life; politics becomes a very circular affair when it is. Nevertheless, if we were to take away any real need to raise funds, a great deal of local political work might well collapse. That would bring about a particularly dangerous situation.

With more power in London rather than the constituencies and with one of the organisational tasks which pulls a constituency together and motivates it rendered largely unnecessary, we could find ourselves with a substantially weakened democratic structure. At a time when people are increasingly interested in local issues, and when they equally feel a growing sense of alienation from the centres of power and decision-taking, anything which could conceivably undermine local political activity should be approached with the greatest caution. I find myself therefore in several minds on this question. I know as well as anyone the difficulties which political Parties have to face. But I equally appreciate the dangers that could result from any over-radical attempt to shift the burden of support from individuals to the State.

I welcome the proposals in the gracious Speech about the provision of help to Opposition Parties; all of us leaving—or, less happily, arriving—in Opposition know how awkward life can become on these Benches and how welcome a little more logistic support would be. I trust that we shall make rapid progress in discussing what can best be done. I do not want to press the noble Lord who is to answer for the Government, but I hope that before too long we shall know what are the proposals of Her Majesty's Government in this respect. There are a number of possibilities and I hope that we shall all approach them with an open mind. However, any more fundamental changes, which would almost certainly be unpopular in the country, should be carefully studied and widely discussed.

There are established ways of looking at these matters—Speaker's Conferences, Royal Commissions and so on. In any event, we would have to ensure, whatever our political Party that the longer term results would help to strengthen, rather than weaken, the institutions of Parliamentary democracy in this country.

4.4 p.m.


My Lords, some of you may remember that I put down a Starred Question on the Order Paper some weeks ago on this subject. I am therefore very grateful that an opportunity has now been provided by the noble Viscount, Lord Massereene and Ferrard, for a slightly longer debate. I do not propose to speak for very long; first, because much of what I would have said has been said very eloquently by the noble Lord, Lord Beaumont of Whitley. Secondly, as some of your Lordships know, on Wednesday next I have a far more broader Motion down on the Order Paper to call attention to the desirability of considering what changes could usefully be made to our Party and Parliamentary system, to bring it into line with present-day needs and improve the functioning of our democracy. I feel that if I range too widely on this subject I shall be trespassing on, and pre-empting, a good deal of what I should like to say next Wednesday.

Rather like the noble Lord, Lord Carrington, I come down on the side of thinking that some support is a good thing and is necessary. But I do not hold that view without feeling that a good deal of research is necessary to see that this really is a useful move, and to see how far we ought to go in this direction. My theme next Wednesday will largely be that I want people to consider a number of possible ways of improving our democracy. I do not intend to point out in detail what I think should be done. It it so important in all these cases to have carried out the necessary amount of research and to have had the necessary dialogue. Though I do not think there is any question in any of the Parties of being unduly influenced, or influenced in the wrong way by people who provide them with funds, it is inevitable that there must be some influence.

Broadly speaking, I can think of no other area in life where, if you are financially assisted by somebody, it does not have at least some effect on your thinking. But it is a very different matter saying that, from saying that one puts forward the policies of those giving financial help in preference to one's own views. I do not suggest that. Undue influence is undesirable, and I do not want to talk about the different problems of the Parties, but I do not think there is equality, by any means, throughout our Party system. I fancy that if we had a June Election, the Liberals would find it extremely hard to field an adequate number of candidates.

I also think that to-day there is much more danger of corruption than there was in the immediate past. That point was made rather strongly last night by a senior Member of your Lordships' House. I believe he is right in thinking that. Some of our earlier principles have been eroded. There is a greater tendency in our life to-day to look after ourselves, and less regarding the morality of always doing so. However good we may be at the moment, there could, at least, be a danger in the future of landing ourselves in something approaching the American situation. Would it not be wiser, therefore, to take some steps so that Parties are not wholly dependent on outside funds? I think, on balance, we should do so, but I do not advocate rushing or going too far in that direction at the moment.

I shall take one remark from what I shall say next Wednesday. By then I shall have written my speech rather carefully, but to-day I have not done so. I hope that what I am now going to say will not be misunderstood, because I may not put it as well as if I had thought it out carefully. We talk a lot about democracy. It is essential to define what is meant by "democracy"; usually it never means the same thing to two people. When one talks about democracy in Parliament, it probably means Government by the duly elected representatives of the people.

I feel that it is time we had a little less of what is almost hypocrisy about democracy, and got down to thinking about what really happens. The argument is apt to be simple. "Oh!, yes. We are governed by the duly elected representatives of the people. Of course they are elected—and all the rest—in what is almost, by definition, a perfectly satisfactory manner, and therefore there is no need to look any further." But if one takes a little wider look at democracy, one appreciates that we really have to see whether it is working out to-day as in principle one might like it to, and look at it from entirely basic principles.

4.10 p.m.


My Lords, this is a subject I have been thinking about ever since the postmortem went on in my own mind following the Election results, and I am going to confess that I have only begun to do some thinking about this; I have not done very much homework. In fact, I do not really know what homework to do on the subject, and therefore I am particularly grateful to the noble Viscount for introducing the subject to the House this afternoon since, by listening to what other noble Lords have said, I am beginning to get some ideas as to what one might do in the way of reading and studying. I entirely agree with every speaker who has said that this is not something to rush into.

This is perhaps one of the issues where the Cross-Benches can be of help to the Parties by, as it were, holding up a mirror on the basis of: O wad some Pow'r the giftie gie us To see ourselves as others see us! because in the course of one's ordinary social contacts in life one is either talking to people in one's own Party who obviously agree, or talking to people in another Party who obviously disagree; but one's personal friends, if they do not happen to be concerned with politics, may not tell you, for reasons of personal courtesy, what they really think. But they do tell Cross-Benchers what they think about all the Parties. I hear many comments from people who are not politically minded in the least about the public image of the Parties at the moment. Doubtless historians will debate the last Election for a long time to come. But it is seen by many people as a massive vote of no confidence in both the main Parties, with the Liberals used as a refuge from those who sought one from a choice between evils. That is how very many people see the three Parties.

It seems to me that that in itself is not good. There is an old dictum in the field of justice that it is not enough that justice be done; it must be seen to be done. In the field of independence and political independence, it is not enough for people to be independent; they must be seen to be. The Conservative Party must be seen not to be the Party of big business. It is not a question of it itself claiming that it is not; it must be seen by everybody not to be. In the same way, it is not sufficient for the Labour Party to say that it is not dominated by the unions; it must be seen not to be so dominated. So long as big business is supporting the Conservative Party with funds, and the unions are supporting the Labour Party with funds, however innocent the support may be people will not believe in it. There is a credibility gap between the Party and its supporters in the eyes of the public.

It is very important—and I believe the noble Lord, Lord Wigg, was saying very much something of the same effect on the Second Reading of the Farriers Bill the day before yesterday—not to miscalculate the side effects of legislation so that the cure is worse than the disease. I suppose that the classic case of this was prohibition in America which was intended to improve American morals. In fact, it put the American Republic into a moral disaster area from that time onwards by putting excise revenues into the hands of the criminal classes. We must be careful in thinking about this subject to ensure that we are not going to put power into the hands of the Whips when in the opinion of many Back Benchers they possess too much power already. The phrase, "Lobby fodder" was never coined in this House. Is it the Parties that should get any money going, or should it be the constituency associations? If the Parties get Parliamentary money they will practically be in a position to dictate without effort who sits for what constituency because they will be providing the funds. This could be a very dangerous situation—exactly the opposite of what one would like to see brought about.

The reason why I am interested in this subject is that I am interested in independence—freedom, if you like; independence of the Back Bencher from the Whip; the independence of the Party from its backers, and the independence of Parliament from the obstructionism of the bureaucracy which is growing and growing the whole time. That, my Lords, is why I am interested in the subject. It is why I promised the noble Viscount, Lord Hanworth, that I would support him when he himself came to speak about this matter, and it is why I have intervened in the debate this afternoon on the Motion of the noble Viscount, to whom I am very grateful.

4.16 p.m.


My Lords, I apologise for the fact that my name is not included in the list of speakers, because I did not intend to speak to-day. However, I should like to say just a word. I have been in public life for only 55 years, and have held a good many offices of various kinds, and I am wondering whether, in a debate of this kind, we are getting our priorities right. We are finding ourselves to-day, through no particular Party's fault, having to subsidise this, subsidise that and subsidise something else. I wonder whether even in those subsidies we are getting our priorities right. I am not quite certain, having been Pro-Chancellor of a university—and do not think I am saying anything against students because 80 per cent. or more of them are still the salt of the earth and it is only about 15 per cent. who are creating all the trouble; I know that from personal experience—whether our priorities are quite right when we give £50 million to students and only £18 million to nurses.

So we go on. We are talking to-day about State financing of political Parties. There is no such thing as State financing. Whatever the finance is, it conies out of the taxpayers' pocket. Here a procedure is being suggested so that a great many taxpayers may be paying into something they entirely dislike and with which they entirely disagree. One has to be very careful before one does away with what one may call the freedom of politics. Here again, I have been out of it for so many years—over 30—simply through offices I have held and one thing and another which have prevented me from taking part in politics. I begin to wonder whether, through the media or whatever it is called, we are not getting plugged with too much politics. Politics really should be dealt with in the village hall, the town hall—somewhere where, if views and what the nation needs and the reason for it are put over properly, the people begin to understand it.

I am wondering what is going to happen if we find ourselves with State-controlled Party politics. It may be necessary. We listened to the agricultural Question this afternoon, and it may be that we are a poor nation and well down the ladder. I do not believe we are quite as far down as people think. But it may be that something of the nature suggested, to retain our democratic ideas about how we run our country and things like that, must be preserved. But do not let us, I beg your Lordships, rush into anything of this kind without realising where the money is coming from and what it is going to mean. I am delighted that this matter has been raised so that we can discuss it, and I am grateful to the noble Viscount who, when he is not in his fastness in Mull, honours the county in which I live and is a great asset to us in many ways there. But we must not rush our fences here, if I may say so—I have no right to say so because I have been so much out of politics. But I would end where I started. Let us quietly think what our real priorities are, what is really necessary for this nation at the moment, before we start pouring money into the uses of political Parties.

4.20 p.m.


My Lords, like the noble Lord on the Front Bench opposite, may I begin by declaring, if not a present, a past interest. Until 10 years ago I was head of a department on the opposite side of Smith Square to the Party of the noble Lord. In those rather difficult days financially, one was conscious of the very substantial personal sacrifices—the noble Lord touched on this point in his speech—which were made by a very large number of long-serving members of my Party, and that continues to be the situation at the moment. This is a real problem for all of us who are involved in public life. I am well aware of the fact that a large number of people continue, year after year, to do difficult and very low-paid work when they could, outside their Party, earn far greater rewards.

My Lords, this brings me to one point where I fear I am in some slight disagreement with the noble Viscount, Lord Han-worth, who spoke a moment or two ago. I think, perhaps unfortunately, that in using the term "corruption" when talking about Watergate he implied that in certain circumstances there was some relationship between certain events that have recently happened in this country and current events in the United States. I am bound to say, with very great respect, that I think that grossly overstates the posi- tion. I do not believe that we have anything remotely like the problems recently experienced in the United States.


My Lords, I am sorry to interrupt the Minister, but I must stress that I did not say that. There was absolutely no implication that there was any connection between anything that might happen, or has happened, in this country and Watergate. The only point I made was that in the future one can never be absolutely certain that something might not occur. I said "the future", and Your Lordships must be clear on that point.


My Lords, I am very much obliged. If I did the noble Lord an injustice I very much regret that, but it seemed to me that there was a certain reading from his remarks that he had made a suggestion of that kind. I am very glad to know that he was making no such suggestion. Turning to the issue before us to-day, I can start by saying that on one particular point we can all be in agreement: how very much we all appreciate the fact that the noble Viscount, Lord Massereene and Ferrard, raised this question to-day and has given us the opportunity of discussing it. The question of the financing of our political parties is central to the health of our democracy. Curiously enough, in the past it has been an issue which has received remarkably little attention. The issue that the noble Lord has raised to-day can be divided neatly into two parts. First, there is the question of what can be done to assist Opposition Parties to carry out their Parliamentary work more effectively. Secondly, there is the more general, and far more controversial, question of whether the State should subsidise the general expenditure of political parties. I shall, if I may, deal first with the immediate problem of financial assistance to Opposition Parties. It was not until relatively recently that the Opposition as such received any assistance at all from public funds. Only in 1937, when the Premiership was first given statutory recognition, was the post of Leader of the Opposition formally recognised, and the Leader of the Opposition in another place given an annual salary of £2,000. The present aid provided to Opposition Parties in both Houses is exceptionally limited. In this House it is effectively confined to the payment of salaries to the Leader of the Opposition and the Opposition Whip. In another place payments are also made to enable the Opposition Whips to organise the business of the House, and in addition a certain amount of clerical assistance is available. This is clearly not a satisfactory situation.

In his speech in another place at the conclusion of the debate on the Queen's Speech, my right honourable friend the Lord President of the Council indicated that he would be glad to discuss with all the Opposition Parties any suggestions they have for further assistance in this field. I understand that the present position—the noble Lord asked me to say something about this—is that these consultations are continuing, and I believe that my right honourable friend is at the moment awaiting the proposals of the Conservative Opposition in another place. Representations have also been made to my noble friend the Lord Privy Seal about financial assistance to Opposition Parties in this House. There are inevitably, in a matter of this kind, some difficult issues to be resolved.

In the first place, we will have to decide whether such financial provision should be provided in the form of a straight grant, leaving its use to the discretion of the Parties themselves, or whether any assistance should be specifically related to the provision of salaries for particular functions. In his speech my right honourable friend the Lord President mentioned three particular areas of potential help to Opposition Parties. These were accommodation, clerical assistance and research assistance. In this House perhaps the most immediate concern is with the running of the Opposition Whips' Office.

We need to decide the allocation between the Opposition Parties of any additional financial assistance in this field, taking account, in particular, of small minority parties. I very much take the point which the noble Lord made on this particular issue in his speech. The strength of Party representation would seem to be probably the most obvious basis in this House, but in an elective House the issue is perhaps not quite so clear. It could be argued that, in some respects, it would be more appropriate that any aid should be dis- tributed on the basis of votes cast rather than seats achieved. I am quite sure that I will have the agreement of the noble Lord, Lord Beaumont of Whitley, on that particular proposition. A further issue, with which perhaps the other House is more immediately concerned, is the question of the provision of research assistance for Opposition Parties. Important sources of aid in this respect, which have been of considerable help to Opposition Parties, particularly to a number of my right honourable friends in the last Parliament, are due to expire next year. We need to consider whether, and how, this gap is to be filled.

These are all clearly matters of some considerable importance and complexity and they will obviously provide the frame-work for the discussions which will take place between the Parties. This is as far as the Government are committed at present: we are committed only to the limited idea of providing money for Opposition Parties to help them with their Parliamentary functions. Having said that, I turn now to the second—


My Lords, I am sorry to interrupt the noble Lord, but it occurs to me that in these discussions it would be of great help to the participants and of great help, indeed, to Members of both Houses if there could be compiled in the appropriate quarters a White Paper showing what is done in other countries in this respect. My impression is that we are much more niggardly as regards the remuneration of public officers than most other democracies.


My Lords, I will gladly undertake to have that particular point looked at and see whether we can provide the information for which the noble Lord asks. As I have said, the second issue, as I defined the issues at the beginning of my speech, is by far the most difficult. It is whether we should provide public funds—I take the point the noble Lord made that this means the support of the taxpayer—to help Political Parties in their non-Parliamentary functions; that is, the running of their central Party organisations and their expenditure on fighting Elections.

The idea that political Parties might receive this kind of assistance is relatively new in this country, and, frankly, it is by no means generally accepted; yet I am aware that there are many people who believe that a strong case can be made for a move in this particular direction. The Parties have an essential part to play in their own right in the democratic process. A healthy democracy needs healthy Parliamentary Parties. In turn, the Parliamentary Parties need a proper base, with adequate research facilities to enable them to inform the thinking on which their future policies can be based. But such facilities are inevitably expensive—exceedingly expensive. The noble Lord, Lord Carrington, raised this particular point.


My Lords, I do not in any way wish to curtail some degree of assistance towards the conducting of their Parliamentary duties, and all that that entails. But when, for instance, money is spent widely on broadcasts and on the media, the taxpayer may find that he has a little grievance.


My Lords, I think the House is aware of that particular point which the noble Lord made so forcefully in his speech. But as I have said, there is here a real issue, a real dilemma, because the facilities that the Parties need, particularly in research, to prepare themselves for office as an alternative Government are exceedingly expensive; and this is particularly a problem at a time of high inflation such as we have been living through in the last few years. So the problem is whether these costs, and particularly the research costs of the Central Party organisation, and at a time of high inflation the exceedingly high cost of fighting elections, should be met entirely by private individuals or organisations or to some degree by the taxpayer. That is the question which has been raised in this debate, and although I have been speaking in this context about the problem of the major Parties, obviously it applies just as much to the minority Parties, indeed arguably in some ways even more so.


My Lords, I am sorry to interrupt my noble friend, but what occurs to me, when reference is made to minority Parties, is what will happen in this case in regard to financial assistance for logistics, which is a very important issue and is virtually confined to another place? What happens to the Cross-Benches? Where do they come in?


My Lords, with his customary skill my noble friend has identified a particularly difficult problem, which we would indeed have to face if we decided—and we have not in fact so decided—to proceed in this particular direction. But as I have said—and the point has been touched on—a number of countries accept the principles of State aid. These countries include Sweden, Norway, Denmark, Finland, West Germany, France, Israel and Canada. The system used in each country varies, and these variations themselves point to some of the questions and difficulties which we in this country would need to tackle if we decided to adopt such policies. For example, we should need to consider whether a subvention should be paid direct to candidates at an election, as in France and Canada, or to the Party sponsoring the candidate, as in most of the other countries that I have mentioned. We should need to decide whether the amount payable should be dependent upon the number of Members returned to Parliament or on the number of votes received at the last election, or possibly a combination of both these factors; and also whether it would be necessary to contest a minimum number of seats to qualify for assistance.

We should probably need to define "Party", which at present is nowhere defined or even mentioned in our law. We should also need to determine the extent to which the accounts of the Parties should be open to inspection and public audit, as in the case of West Germany; or whether there would be no strings or supervision, as, for example, in Sweden. We should need to consider the important and related question of whether generalised election expenditure by Parties should be controlled, as it is not controlled at the moment, and whether political advertising designed to favour a particular Party should also be subject to control as at the moent it is not. We should need to consider the question of tax relief for certain donations to political Parties (as in the United States of America); and we should need to consider the condition which will operate at United States Presidential Elections after 1976, that a candidate may accept money from the election fund administered by the United States Federal Comptroller-General only if he undertakes to refuse money from all other sources. Finally, we should do well to have in mind one of the possible consequences of State aid to political Parties, which is that a Party might wish to use the money to support a newspaper favourable to its cause, with all the implications that that might have.

These are only some of the questions which will need to be asked as we consider the possibility of this fundamental reappraisal of the relationship between the State and the political Parties. The different models adopted by other countries may provide a useful starting point for discussing this issue; but those who favour this idea will no doubt want to devise their own system, suited to the conditions and conventions of our own political life. As I have said, the Government have not declared their policy on this wider issue, but I can certainly say that we are strongly in favour of a wide and vigorous discussion of the subject, as we have had to-day. I think this debate is a notable contribution to this process of discussion, and I can assure noble Lords who have spoken that we have listened with the greatest interest to what they have said. May I finally repeat the gratitude of all sides of the House to the noble Viscount for having initiated the debate.


My Lords, before the noble Lord sits down I wonder whether he would undertake to draw one point to the attention of his colleagues, and particularly the noble Lord the Leader of the House. He has spoken quite a lot about the help that might be given parliamentarily to Opposition Parties, and the noble Lord, Lord Shinwell, raised the point about Cross-Benchers, or the more independent members of the Parties. It would be a great asset if the noble Lords would consider the possibility of providing more general research facilities for Members of your Lordships' House. We are exceedingly grateful for the help given to us by the House of Commons Library; but there really is a need for boxes, research papers and all the things which they have, and which Members of your Lordships' House would appreciate in trying to do a serious legislative job.


My Lords, I thought I had in fact concluded my speech, but certainly we will take note of the point raised by the noble Lord. My noble friend has heard his remarks, and I am sure he will consider them.

4.38 p.m.


My Lords, the noble Lord, Lord Gifford, has arrived, and is probably "raring to go"; but I should like to make one or two brief remarks. In the first place, I wish to thank all noble Lords who have spoken. I have found the debate most interesting and it has taught me a lot. The noble Lord, Lord Beaumont of Whitley, referred to the sale of honours and said it was not as dangerous as the sale of policies. I admit that I had not thought of that point; he may be right.


Why need you have either?


Why indeed, my Lords. My noble friend Lord Carrington made the point that if we had State aid for the political Parties we might then get to the position where the State completely controlled the political Parties. But surely that would come about only if you had a totalitarian State. Under democratic law I feel sure that would not happen. I appreciate the point made by the noble Lord about local branches. It would be disastrous if all the various activities of the constituency branches were to decline.

I agree with the noble Viscount, Lord Hanworth, that obviously a great deal of money must influence matters; it probably influences policy in some cases. I agree with the noble Earl, Lord Halsbury, that it would be useful if Her Majesty's Government could bring out a White Paper, or something of that sort, showing exactly what other countries did in this connection and what form of State financing for political Parties they had.

May I just thank my noble friend Lord Cornwallis for whom I have such great admiration. I see his point completely. Some taxpayers might object. Although State financing might amount to £10 million per year per head of the electorate, it would come to less than the cost of a packet of cigarettes. But I appreciate there might be large numbers of the electorate who would object.

My Lords, having said that, I should like to thank the noble Lord, Lord Harris of Greenwich, for his speech and say how pleased I am that he agreed with me—or so I thought—that any form of State aid to the Parties (and I am not talking of politicians already in Parliament) ought to be based on the number of votes cast at previous General Elections. I thank all noble Lords once again, and beg leave to withdraw the Motion standing in my name.

Motion for Papers, by leave, withdrawn.