Trade Union Bill

HL Deb 12 July 1984 vol 454 cc1108-66

Consideration of amendments on Report resumed.

The Earl of Gowrie moved Amendment No. 10.

[Printed earlier: col. 1074.]

The noble Earl said: My Lords, I beg to move.

Lord Wedderburn of Charlton

My Lords, it has become somewhat customary for me to speak to an amendment after dinner to an excited and somewhat less than crowded House. But I can assure your Lordships that the reason why I am speaking to Amendment No. 10—and I am sure that the noble Earl will not object if I refer also to Amendments Nos. 11 and 14, since they patently go to the same substance of the matter—is, as my noble friend Lord McCarthy explained, that we are perhaps at one with the noble Earl in thinking that these are what he called in our earlier debate major changes in the Bill.

[Amendments Nos. 11 and 14 printed earlier: cols. 1074–75.]

Whereas the earlier amendments, Amendment No. 6 and those that went with it, went more to what one might call the substance of the matter, Amendments Nos. 10, 11 and 14 go very much to the machinery. They go to the machinery by bringing in the certification officer as an additional mechanism whereby an aggrieved member may complain. It is therefore of fundamental importance to consider in what ways and for what reasons the certification officer is brought in.

I say at once that we are not yet clear why the certification officer, as a mechanism of complaint, was brought into the Bill at all. I say immediately that, on any reading of the amendment moved by the noble Lord, Lord Beloff, which became the new subsection (6) of Clause 2 of the Bill in Committee, there was no requirement to introduce another mechanism for complaint.

The certification officer at the moment has what might be called certain administrative functions and certain judicial or quasi-judicial functions. His administrative functions include the list of trade unions which he keeps and various functions relating to amalgamations and mergers. His judicial functions include, of course, the decisions upon complaints by members in respect of the merger procedure under the 1964 Act, or the political fund and their place in regard to it under the 1913 Act, and over all the judicial or quasi-judicial matters there is, of course, an appeal to the Employment Appeals Tribunal.

Against that background, perhaps I should mention one most salient fact. It is that the certification officer took over one of the most valued traditions in British trade union law. That was the tradition of the old registrar, the pre-1971 registrar, who had been such an important piece of machinery in the smooth working, not just of trade unions but of industrial relations as well.

Against that background I must ask a number of questions. First, the jurisdiction that is given to the certification officer in these new amendments, and especially in Amendment No. 14, is not a judicial or quasi-judicial function, as appears directly. It is investigatory; it is, if one wanted to use the technical term, inquisitorial, as against being purely adversarial. That is to say, there are two fundamental approaches to judicial and jurisprudential litigation. The first is the adversarial system, upon which English law and Scottish law is to a large part based; the second is inquisitorial. If one does not like that technical term, then perhaps the lay word "investigatory" is better.

It is the first rule of English law, and of some civil law systems based on the inquisitorial method, that where there is a cause before the court, or where a person must decide matters, then both sides must be heard. What do we find in subsection (5) of the new clause? We find that the certification officer shall give the applicant member and the trade union an opportunity to be heard, where he considers it appropriate". Why? What on earth is the reason for that?

Secondly, even in regard to that apparent mixture of investigatory and judicial or quasi-judicial mechanism there is no appeal to the Employment Appeal Tribunal. Why? If this is meant to be a judicial procedure, then why has there not been followed the precedent which has been followed in all the statutes since 1975, and which went back to the 1913 Act, even, and was inserted there? That precedent was that there should be an appeal at least on questions of law. Sometimes in the Government's own legislation, in 1980 and 1982, they have made the appeal to the Employment Appeal Tribunal on law and on fact; but there is nothing here of that kind.

Third, it is a fundamental principle of any sensible system of jurisprudence that no party should be put in double jeopardy; that no party should have to answer the same claim twice. That is precisely what these clauses do. The member who is aggrieved is given the possibility of two bites at the cherry. He can go to the certification officer (and the noble Earl will correct me if I am wrong) and yet there is nothing to prevent him, if he fails before the certification officer, from going before the court for a second try. The trade union can be dragged before the certification officer and completely cleared by him, but it can then be taken to the High Court. If it loses in the High Court then it must go to the Court of Appeal and to the Judicial Committee of your Lordships' House, the House of Lords in its judicial role. Why?

Indeed, it seems absurd that a union member can go first to court and then to the certification officer, although I apprehend that the certification officer might make a rule of procedure not allowing that to happen. One would have thought that the Government would have provided for that in the Bill. The certification officer can not only make his own procedure (and that is understandable) but he has also to make such inquiries as he thinks fit". before the hearing, if he considers a hearing to be appropriate. There is confirmed the investigatory or inquisitorial character of the new jurisdiction that is being thrust upon the certification officer.

This Bill, in respect of its procedures, begins to be a lawyer's paradise. There are antennae in the Temple quivering with delight at the thought of the fees which can he earned in these dual procedures and from the complex mechanisms which they will involve.

There is a further matter of the most extraordinary importance. In subsection (2) of the proposed new clause the certification officer is told that he must give the reasons for his decision in writing. That is very sensible. But then he is told: any such reasons may be accompanied by written observations on any matter arising from, or connected with, the proceedings". Not only can he make a decision, not only can he give his reasons for the decision, but he can make observations on any matter arising from, or connected with, the proceedings".

The Government are quite fond of the words "connected with", except in respect of a definition of a trade dispute, where they did not like them because they are supposed to be very broad. Indeed, the Government told us that in respect of a definition of a trade dispute the words "connected with" were so broad that they could encompass almost anything. Presumably that is true here. What do the Government imagine that the certification officer is going to talk about except the reasons for his decisions and the findings of fact which he has made? What are these "observations" going to be? Are they going to be on the desirability of union policies, or on matters connected with officers of the union? These will of course be "connected with" if not "arising from" the matters which are before him. Surely on Third Reading the noble Earl must come back and tell us that he intends to amend some of this awful phraseology.

A further factor is that if this matter goes to the certification officer first, the court is not bound by his findings of fact. This brings us back to my first question. The court must pay due regard to the officer's declaration and to his reasons. Indeed, it is stated quite clearly in subsection (4) that the court must do so in respect of his observations. But if the court is not bound by the certification officer's findings of fact, even, then will not any member who loses before the certification officer go to the court? Is it fair that members should have that opportunity without impediment but that the union should have no opportunity to go to the court if the certification officer decides against it?

To press the matter a little further, if there is no appeal to the Employment Appeal Tribunal even on questions of law, there is only one course open to the union, and that will be to go for judicial review in the High Court—what used to be called certiorari. There will follow the most appalling set of squabbles about the procedures. With great respect to those involved in drafting them, these provisions have not been thought through.

Finally, I wish to mention two further matters. When he makes his observations, the certification officer will in my submission be drawn into just that further role which the noble Earl has told us yet again tonight he does not wish to see the officer occupy. That is to say, if the certification officer feels impelled to make observations about the general situation of the union, how will it be possible for him to avoid making suggestions to the union about the way it keeps its register, and about the way certain matters are organised, quite outside the actual litigation?

Quite apart from that, one of the great merits of the certification officer is that on his present jurisdictions he does engage, and quite properly in terms of his administrative jurisdiction, in informal contacts with trade unions which are in difficulty. That is why the certification officer is of such enormous importance (as was the pre-1971 registrar before him) in the on-the-ground administration of trade union and industrial affairs.

Two things will surely happen. The certification officer will be drawn in because of the jurisdiction given him in this clause, which is investigatory and which invites him to make observations; and also because of the tradition of informal contact. It must follow that when trade unionists do not like what he is saying they will regard him as an agency statutorily-imposed upon the structures of their unions, which the noble Earl has told us he does not wish to see happen. In other words, the Government, having set out on this path, will find that the administration of the clauses they have proposed, as at present drafted (and this does not necessarily mean that those clauses could not be re-drafted), will take the Government into the quagmire which the noble Earl has told us he does not wish to enter.

A word about the ILO. I have argued before your Lordships, as my noble friend Lord McCarthy has argued tonight, that the 1983 report of the committee of experts made it quite clear that detailed regulation, and especially detailed regulation in respect of anything like an agency, is offensive to free elections according to Convention 87. It is because these amendments are particularly relevant to that that we thought it important to raise them separately tonight. I may say that the Government give no one great confidence about their recognition of obligations under the ILO conventions by the way they have handled the GCHQ affair; but one hopes that they will consider the matter afresh in this light.

I pass to my final two points. The first is a very practical point. Is it not the case that the office of the certification officer will need tremendous expansion on the Government's own amendments? If so, where is the money to come from? At the moment the certification officer works under the ACAS budget. The net cost in the year to March 1983, according to the 1983 report, was £216,607. It is impossible to imagine the certification officer handling all the matters with which he will have to deal under these amendments without a considerable expansion of cost to the public purse. If there is to be that cost, then it should be fully revealed, although of course I am aware that it is more a question for another place than for here. No doubt before it goes back to the other place the expenditure question will be raised.

Finally, it may be said: of course, the certification officer will not act in any way which is unreasonable under these powers; he may have the powers of a big brother under these clauses to investigate, to say what he will, to fashion the union registers and the like, but he will not act like big brother. Indeed, that confidence which has existed between trade unions (and the registrar in the old sense) and the certification officer might make one hope that that would be so. But if he is not going to act like that, why give him big brother powers?

As to the last three debates—that is to say, the debates on the 1980 Bill, the 1982 Bill and on this Bill—I have never been reminded more of the debates of your Lordships' House in 1971 than I have been this evening. I read them very carefully, although of course, I was not here. This evening reminded me of those debates where there was a warning that the registrar (as he was transmuted in that Bill) would be someone not just unacceptable to the trade unions and to trade unionists. We are not just talking about a few trade union leaders, and the noble Earl the Minister deludes himself if he thinks that in this matter, where the internal process of the union and its relations with the law are at stake, there are just a few people at the top of a trade union who are concerned. The same warning was issued in 1971 on just this aspect.

The real decision for the Government is whether or not they will reconsider if they wish to have the certification officer. Will they ask themselves first the question: why? Secondly, will they ask themselves the question: is he to be a judicial officer supplementary to the court? This is rather the way in which the noble Earl presented him. If he is, why not amend the clauses so that he appears as a judicial officer and not as an investigatory agency? Lastly, if he is to be a judicial officer, why not adopt the, by now, traditional power of appeal to the employment appeal tribunal for either party, at least on matters of law?

If the Government do not respond to questions of that sort on amendments which, I quite understand, have had to be put together rather rapidly, there will be further confirmation that they are treating trade unions as something different; that they are treating trade unions as bodies and trade unionists as persons to whom the rules of double jeopardy do not apply; to whom the rules of natural justice do not apply; to whom the fundamental rules of our legal system do not apply. On that basis, I very much hope that your Lordships still hear something tonight from the noble Earl the Minister to indicate that he will reconsider at least some parts of Amendments 10, 11 and 13.

8.25 p.m.

The Earl of Gowrie

My Lords, the noble Lord, Lord Wedderburn, is one of the two or three people in the country, I would say, who are most interested and most expert in industrial relations law. This is one of the reasons why it is always a pleasure to listen to him and I always find it instructive. But like a lot of experts, he does, I think, sometimes fail to see the wood for the trees. I have listened very carefully to him and it seems to me that he has failed to take account of a very fundamental point.

The fact is that no union will be in any way at risk of being "hauled through the courts"—to use a phrase, I think, which he used—enriching lawyers en route, as he seems to be anxious to avoid if the union complies with the law which Parliament has passed, and which I think even those of your Lordships who disagree with it have not criticised as being framed in a particularly complex way. The basic principles of this Bill are extremely simple, and I have gone over them many times.

We recognise, of course, that back-up systems and systems of appeal are necessary. This is precisely why by these amendments a union member who believes that his union has infringed one or more of the requirements of Part I of the Bill—and, as I said, they are incredibly simple requirements—will now have a choice of remedies open to him. He can complain to the court as the Bill originally provided, or he can complain under my amendment by means of a simple letter to the certification officer. This is not simply a matter of two bites at the cherry; it is a matter of trying—as the noble Lord and his colleagues are always eager to try to persuade us to do—to make things reasonable and flexible, easy to understand, and a matter of trying to avoid unnecessary litigation.

Trade unions will have everything to lose by refusing to co-operate with the certification officer and ignoring any declaration the certification officer makes. If a trade union does not try to refute evidence of a breach which one of its own members has put before the certification officer, it will increase the chances that it will be faced with a legal declaration. If it ignores a declaration, it will increase the chances that it will face an enforceable order from the High Court. If it seeks to boycott the whole process of complaint to the certification officer, the existing route of complaint directly to the High Court will be unaffected. That protects the complainant, but equally well it gives a reasonable incentive for the trade union to settle the matter, and we are constantly being urged that the aim and end of industrial relations is to get sensible settlements.

On one or two specific points, the noble Lord asked me about the jurisdiction of the certification officer. He wanted to know why the applicant should not be given a right to be heard. The fact is that it may not be appropriate to hold an oral hearing where a complaint is trivial. Quite clearly, the certification officer will always give the parties an opportunity to be heard in the case of any serious complaint; but we do not want to initiate legislation which can lead to people playing games. I think again the noble Lord would endorse that in respect of his position, let alone ours.

On the matter of double jeopardy, I think the noble Lord, Lord Wedderburn, which is rare for him, misunderstands the provisions. No union will find itself in double jeopardy because the certification officer has no order-making power; the certification officer may make a declaration but only the court can make an order against the union. We would assume that it would be sensible, as I said earlier, for the union to avoid the costs and irritation of litigation by, on the whole, taking seriously what this sensible fellow has to say.

On the issue of the judicial review, again, in a manner that I think is surprising from him, the point of the noble Lord is misconceived. If a union wishes to challenge a declaration of the certification officer, the opportunity will come if and when the applicant goes to the court to ask for a declaration and an enforcement order. At that stage the court will be considering the matter from first principles, although it will, of course, be required to take into account the certification officer's declaration and the reasons for it. We are quite accustomed throughout the whole corpus of industrial relations legislation—whether put forward from these Benches or from the Benches of the noble Lord—to having the courts take into account codes of practice; there is nothing novel about that.

The noble Lord also asked about there being no need to involve the certification officer under what I might describe as the Beloff amendment. The amendment, which was approved in Committee, contained a clear call for an independent body to be involved in the electoral process. These amendments respond to the clear wish of the House for some independent element in the process of dealing with complaints under Part I. But—and this is the crux of the issue—they do so in a more practical way, in my contention, than the way suggested by the noble Lord, Lord Rochester, at a previous stage of this evening's proceedings.

The last point I make is really an echo of something I said before. No union need be at risk of this kind of expensive and damaging legislation, because it is extremely easy to comply with these laws in respect of elections, ballots and the rest. However easy or however difficult an enforcement procedure may be—and we have tried to make it as easy as possible—those who obey the law of the land have nothing whatever to fear and have been given every incentive to avoid enforcement procedures. It is only where a union fails to comply with the statutory duty concerning these basic democratic rights for its members that it is liable to be in jeopardy. If unions do so fail to comply, there seems to us to be every justification for giving their own members the adequate, effective and easy to understand remedies that we propose.

Lord Wedderburn of Charlton

My Lords, I am sure the noble Earl will not mind if I ask him two questions, because it may save time on Third Reading. As a preliminary to them, of course we are not concerned with whether the union obeys the law of the land. Good procedures are devised so that those who break the law by mistake, or those who wish to enforce the law, can have proper remedies throughout.

The two questions are these: first, are we correct in understanding that if a member complains to the certification officer and the trade union wins its case in regard to its allegations of fact and its arguments of law, nevertheless that member can still go to the court without any impediment? That is the kind of case referred to in the broad sense of double jeopardy.

Secondly, and perhaps more important because the noble Lord said something about this just now, if the trade union loses before the certification officer, do I understand the noble Earl to be saying that the trade union itself has no locus standi for any kind of complaint unless it be judicial review to the High Court? I was doing the Government a favour in saying that the union at least had the right to go to the High Court for judicial review, because, if you do not go for judicial review, is it not the case that the union cannot change the decision of the certification officer under these clauses? It has no appeal to the EAT and it has no right to go to the High Court. What the noble Earl said as I understood him—and I should like to make sure that I have it right—is that the way in which it could he reopened is if the member went to the High Court; which goes back to the first question.

The Earl of Gowrie

My Lords, the point of the certification officer is to get a sensible settlement out of the court, so to say; but this legislation does not propose to make the certification officer into a kind of judge. I do not think the noble Lord, with his deep knowledge and reverence for the traditions of the trade union movement, would want the certification officer turned into a kind of judge. As I said, the officer may make a declaration but only the court can make an order against the union. What the certification officer finds has to be taken into account by the court. That is no great novel precedent.

If the certification officer throws out a stupid case and if, then, a rather litigious individual decides to take that case to the court, I should think that all the odds would be that the court would throw it out again with costs. Nevertheless, it is the right of all of us, whether members of unions or not, to go to the courts in civil litigation and I cannot believe that the noble Lord is seriously proposing that the individual member should in this case, uniquely, not be allowed to do so.

Lord Houghton of Sowerby

My Lords, I should like to ask a question. Would the function of the certification officer extend to pronouncing upon the new clause that we have after Clause 2, which states: Where a trade union proposes to hold an election and is satisfied, and so on? I presume that the responsibility for feeling satisfaction rests upon the union. However that condition may be reached, whether at a delegate conference or at a meeting of the executive council, or whatever, would the certification officer be brought into any challenge to the grounds upon which the union was satisfied it being held that they ought not to have been and that they had no reasonable grounds?

What I am getting at is this. If the certification officer is to be the assessor of the judgment of a union, whether it was reasonably arrived at or whether there were considerations that had to be brought to bear upon their judgment, then this is really a judicial function and not that of a certification officer. Without being disrespectful to the certification officer, I am thinking how dangerous it may be to introduce a functionary between the complainant and the courts. We have got this in connection with the Video Recordings Bill—and I hate to refer to it—where the British Board of Film Censors is to be the designated authority with statutory powers to be judges in the first instance for the purposes of classification but the courts are still in the background to judge the fundamental question of obscenity and obscene publications. Here we have a certification officer who is virtually a court of first instance and, if people are not satisfied with what he declares, then recourse to the courts is still possible.

I think that is a very dangerous intervention of bureaucracy between the complainant and the court. If we are to have an officer in this position he may be a designated authority like the Parliamentary Commissioner or the Chairman of Tribunals but he will be somebody with authority. How can we go on clutching on to a functionary who is there for an entirely different set of purposes and use him as a kind of court of first instance in matters of grievance between members and their unions? That is the real complaint, and I endorse what was said by my noble friend who has just sat down—I am sorry, his name escapes me, which is ridiculous and shows I am nearer 90 than 80. That is the question, anyway.

The Earl of Gowrie

My Lords, there is nothing wrong, if I may say so, with the noble Lord's memory where union practice or industrial relations law is concerned; but I think that, while that is certainly the case, he does misunderstand this point. One can use phrases like "court of first instance" and so on, which are rather intimidating, but in practical life we all know that we sometimes appeal to a third party to try to sort out matters. This third party is not a novel figure invented by the Government and suddenly imposed upon the unions. This is not the industrial relations court in the 1971 Act, or the rest of it. This is a reasonably familiar figure—the certification officer.

It is also quite untrue to say that the certification officer has no jurisprudential locus whatsoever—that he is, as it were, the central heating man or is engaged in a totally different set of functions. He already has a number of important jurisdictions under the 1913 Act and also under the Trade Union (Amalgamations, etc.) Act 1964. He is a reasonably well placed fellow to try to get a decent or reasonable settlement and sort things out.

A member could complain to the certification officer about anything in Part I if he believed that the trades union's action was manifestly wrong. But, as I said just a few moments ago, it is the clear intention of our amendments that, where complaint to the certification officer brings about a satisfactory resolution of the matter, that should be recorded so as to avoid any need for recourse to the courts. The certification officer is not a High Court judge; we are not trying to turn him into one and we are not trying to deny the right of members, if the certification officer cannot sort out the matter, or if the union does not accept his ruling, to take ordinary civil proceedings. That is the simplicity and logic of the law which has here been presented.

Lord McCarthy

My Lords, this is a new amendment, we have not debated it, and it is very important. I should like to make sure that I have the noble Earl's position clear. The question that I think the noble Lord, Lord Wedderburn, is trying to ask is this. If the union wins, in the sense that a member complains and the matter goes to the certification officer, and the certification officer decides for the union and makes a declaration in favour of the union, as we understand it, the noble Earl is saying that the member can go to the court and challenge that declaration. That is fine. What we are asking is, suppose that the members win—

Lord Wedderburn of Charlton

No. The union.

Lord McCarthy

Suppose that the union wins—no. My first case was if the union won. My noble friend is confusing me. My first case was that the union won, and we know that the workers can go to the High Court. Now we get the case where the workers win. If the workers win, and if the declaration of the certification officer is in favour of the workers, can the union appeal to the High Court? The Minister seems to be saying no, but we think that is unfair.

The Earl of Gowrie

My Lords, I do not see that the situation would be at all problematic here. Of course, the trade union can defend itself if the members take it to the High Court. We can all go to the High Court.

Lord McCarthy

For what?

The Earl of Gowrie

What is the problem? I may be very dense but I do not quite see the difficulty being presented to me by the noble Lord.

Lord Wedderburn of Charlton

My Lords, I wonder whether the noble Earl would think this is a useful way forward. I apprehend that we have presented to him—I say this with no disrespect; as I say, these matters have been prepared with great rapidity—some problems which could perhaps not be fully covered by the present clauses, such as the position that my noble friend has just managed to put to the noble Earl, in spite of my most ill advised attempt to advise him in a different direction; namely, the position, for example, where the union faces a decision by the certification officer. It is no good saying that he is not a High Court judge, because he is given powers to make a declaration.

The noble Earl and I would be at one on one thing, and that is, where a person with a power to make a legal declaration makes it, there is, if not a legal, at any rate a strong moral, duty to obey. Indeed, the jurisprudence experts debate whether it is legal or moral on that borderline.

But the certification officer has the power to make a declaration, and say the union loses, the union cannot appeal except, as the noble Earl says, to the High Court. I suggest to the noble Earl that that procedure to go to the High Court, which is quite outside this Bill, is one of extreme complexity and something that should be considered again. If he considers that procedure for judicial review outside this Bill and puts it side by side with the rights of the member who loses before the certification officer, he might find that the matter was perhaps unfairly balanced. I wonder whether perhaps we could proceed on the basis that he will say at least that he will look at the matter again.

The Earl of Gowrie

My Lords, of course I accept that some of these arguments are complex, and part of the purpose of Report stage is that we should all sleep on things, look at the text and see whether we can resolve our differences without—dare I say it?—even getting so far as to appeal to the certification officer. But in fact I again feel that the noble Lord, Lord Wedderburn, is somewhat snowing us with expertise and complexity where none is needed.

I am talking about a situation where somebody is aggrieved and somebody thinks that something is wrong. It is appealed to the certification officer, and we all hope—and I think that nine times out of ten our hope will be realised—that the certification officer, who, as I said, has a jurisprudential locus, so to say, under previous Acts, will be able to sort the matter out. But of course, if he does not, or if the applicant remains aggrieved because the union loses and will not give way to the applicant, then the High Court could find in favour of the union. In the long run the High Court is the court of final decision here, although indeed there are later stages, including that all the way up to your Lordships' House. But I think that the point that the noble Lord is missing is that it might be that the applicant won and the union was aggrieved; the union therefore presumably would not give way to the suggestions of the certification officer. The applicant would remain aggrieved and would go to the High Court. The High Court could then find in favour of the union. I am not a lawyer but that would seem to me to be common sense.

On Question, amendment agreed to.

8.47 p.m.

The Earl of Gowrie moved Amendment No. 11.

[Printed earlier.]

The noble Earl said: My Lords, I think I have spoken to this amendment. I beg to move.

On Question, amendment agreed to.

The Earl of Gowrie moved Amendment No. 12:

[Printed earlier.]

On Question, amendment agreed to.

The Earl of Gowrie moved Amendment No. 13:

[Printed earlier.]

On Question, amendment agreed to.

The Earl of Gowrie moved Amendment No. 14:

[Printed earlier.]

On Question, amendment agreed to.

Clause 4 [Exemption for certain trade unions]:

Lord Wedderburn of Charlton moved Amendment No. 15:

Page 6, line 1, at beginning insert— (" () This Part does not apply to any organisation which—

1. (a) is a trade union within section 28(1)(a) of the 1974 Act (Meaning of Trade Union);
2. (b) is a section, branch or other constituent part of another trade union; and
3. (c) was not separately entered on the list of trade unions maintained under section 8 of the 1974 Act (List of Trade Unions) on 1st January 1984 and is not subsequently entered on the list after that date.").

The noble Lord said: My Lords, it is perhaps somewhat remarkable that one comes at this stage of the Bill to a question that is quite fundamental to Part I of the Bill. I preface my few remarks with this comment. It is, I think, not only my view but that of some of my noble friends that when we come to Third Reading there will be, as we have just seen, rather a large number of matters which, because of its nature and the way in which the Bill has been put together, it might be important for your Lordships, if this House is to discharge its function, to look at rather carefully.

This amendment addresses the issue which may be posed as this question: to whom or to what does Part I of the Bill apply? My noble friend Lord Howie raised the issue, in part at least, by an amendment in Committee, but it was left uncertain, and it is to that question that this amendment relates. There is in one sense a very easy answer to that question. The noble Lord, Lord Gray of Contin, at col. 693 of the Official Report on 25th June answered it in this way: Part I of the Bill as a whole covers all those organisations which meet the statutory definition of a trade union, save for certain trade union federations".

The problem is best described in this way. The definition of a trade union to which the noble Lord referred in Section 28 of the 1974 Act, if I may summarise it, describes a trade union other than a federation, as an organisation permanent or temporary which consists wholly or mainly of workers and is an organisation whose principal purposes include the regulation of the relations between workers of that description and employers or employers' associations. The nub of the question is an organisation which regulates relationships between workers and employers or employers' organisations.

The problem is—and we debated this in another area where the Bill refers to a section of the union—that a section of a union, or a group in a union, or a branch in a union, or a body in a union, can in law itself be a separate trade union. That may sound rather absurd; but one can see why this is if one approaches bodies to which this amendment is not directed—and I insist, "not directed".

If one takes the National Union of Mineworkers—not for any relevance to present day occurrences but because they are the best example structurally—that union is still very much a federation, and the separate areas are clearly separate trade unions and are noted as such on the list of trade unions.

The noble Lord, Lord Gray of Contin, in answering further to the same debate (at col. 696 of Hansard for 25th June) said: I can perhaps clarify the position, because it is really quite clear. If a group inside"— and I stress "inside"— a trade union meets the statutory definition of a trade union under the 1974 Act, then Part I of the Bill applies". The Government themselves have accepted that this is so by yet again one of their provisions; namely, a provision in one of their amendments which deals with the position of where there is a duty upon a trade union and upon a branch. The new clause in Amendment No. 9 (3), tells us that: Any duty falling upon a branch under this section by reason of its being a trade union shall be treated as having been discharged to the extent to which the union of which it is a branch has discharged that duty instead of the branch". That has appeared in previous legislation, but it is clear that a branch—as the Government say themselves—may itself be a trade union. Nothing that I say tonight is meant to decide the question of whether or not a particular branch or section of a union is itself a separate trade union. However, I say that it is a widespread problem.

Perhaps I may refer merely to two trade unions and their rule books—and, after all, the Government have had, since last October to consider them. First of all, there is the Electrical and Electronic and Plumbers Trade Union (the EEPTU). They have a white collar section which has two subsections: the BICC Staff Association—which has its own rules and its own committee—and the Association of Managerial and Electrical Executives, (the AMEE), which has its own rules in a schedule to the EEPTU rule book, has its own committee, does its own negotiating and is clearly capable of being held separate. I put it no higher than that tonight. It happens that the AMEE comes rather close to the Government's scheme, but not exactly so. It is not quite enough for it to get within Clause 2 as I read the rules.

Is it really the Government's intention that Part I should apply not only to the EEPTU as such, but also to the BICC Staff Association separately—that they must have a postal vote; that they must maintain a separate register of members? Or is it the Government's intention that it should apply to the AMEE? The noble Earl must pay attention to this because as the Bill stands at the moment it clearly applies to all of these. If it be thought that those are quirkish, let me refer to the ASTMS rule book. That discloses that the ASTMS has sections with negotiating functions, and in greater or lesser part separate rules and executive committees, of the following kind.

There is a section for the medical practitioners' union. There is the Prudential section. There is the Royal Group section. There is the Midland Bank staff section. There is the Forward Trust Group section. There is the Clydesdale Bank staff section. There is the Pearl Assurance Company section. There is the Pearl Federation section. There is the Midland Bank section. There is the Kodak Senior Staff section. There is the Engineer Surveyors section, There is the Liverpool Victoria managers' group section. There is the Courtaulds section. There is the Refuge section—which is perhaps a section into which those drafting this Bill should by now make themselves affiliated. There is the Reckitt and Colman section. There is the telephone contract officers section.

In respect of those sections which, among others happen to be held to be separate trade unions—and on the present evidence I would not be able to know exactly which would and which would not, but there is no doubt some of them do—is it the intention to have a separate postal ballot within them all? I am sure that as a reasonable man the noble Earl would agree that that would be absurd.

If that is absurd then it is difficult to draw the line. With this amendment we have tiled to set out some possible answer other than that which my noble friend Lord Howie put forward last time. I simply rehearse what it says. It refers to excluding groups within what normally in lay parlance would be called a trade union. We are trying not to have a separate postal ballot for every branch. It refers to a group within the union which is a trade union under the definition—that is paragraph (a)—which is a section, branch or other constituent part of a wider trade union—that is paragraph (b)—and which was not separately entered on the list of trade unions on the 1st January. We have chosen that last phraseology as a trial run at this stage. Of couse the date could easily be negotiated. However, we thought it right to say that those trade unions that chose to register upon the list as being unions holding themselves out as being separate unions, like one of the branches of the National Union of Mineworkers which I quoted in Committee, should be estopped from denying under this scheme that they are not separate unions and they must hold a postal ballot.

But where a group inside the union has never gone on the list, and does not enter the list, the mere fact that the legal definition—which is not just in the 1974 Act, it has taken over from what was basically a 19th century definition—brings a branch, section or group within the definition of trade union, surely cannot be within the Government's intention to lay upon it the obligations which the trade union at the moment is under in Part I.

I am encuraged in the view and suggest to the noble Earl that the logic of the Bill now is that that cannot be so and that further amendments must be made. The very subsection of the new clause which I cited—namely subsection (3) of Amendment 9—takes from the branch, which is a trade union in law, the obligation to maintain a register. Surely it must also take from it all the other obligations of Part I. You cannot have that subsection which says you need not keep a register and then put upon the branch, which is a trade union, the obligation to have a postal ballot.

I am sure the Government are not unreasonable in this matter, and I urge the noble Earl to give us some comfort and avoid litigation—because that is what there will be—about this matter, when in some formula or another it can be dealt with at this stage. I beg to move.

The Earl of Gowrie

My Lords, giving comfort and avoiding litigation are among my major aims in life; but this amendment would exempt those sections, branches, or other constituent parts of trade unions which are trade unions in their own right, within the statutory definitions but which were not listed as such by the certification officer on 1st January 1984 and are not subsequently so listed.

But the Government believe that all the organisations which meet the statutory definition of a trade union should be covered by the requirements of Part I since, by definition, they are in the business of negotiating between workers and employers. The reason why we adhere to this simple proposition is again very simple. The starting point of the Bill is the utterly straightforward test that all those organisations which meet the definition of a trade union in Section 28(1)(a) of the Trade Union and Labour Relations Act 1974 should have to comply with the provisions of the Bill.

I understand that we have before us—to adapt Shakespeare's phrase in the dedication of his sonnets—the only begetter of the Trade Union and Labour Relations Act of 1974 in the person of the noble Lord, Lord Wedderburn. So I cannot quite see what he is complaining about. That definition provides that a trade union is an organisation which—I quote the Act, and no doubt I am quoting the noble Lord— consists wholly or mainly of workers of one or more descriptions and is an organisation whose principal purposes include the regulation of relations between workers of that description or those descriptions and employers or employers' associations". In ordinary parlance, to be a trade union an organisation must be in a certain business. It must be in the business of representing its members in negotiations with employers. Part I of the Bill will simply ensure that the leaders of any organisation which meets that test are genuinely representative of the membership. I appreciate that the noble Lord has considered this issue carefully and has gone to some lengths to devise a formula in his amendment that avoids some of the difficulties associated with earlier amendments in this area, but the formulation of his amendment produces some peculiar anomalies all of his own. These arise because, under this amendment, the issue of whether or not a section, branch or other constituent part of the union was exempt from Part I would depend on whether or not it was listed by the certification officer on one particular date, as I said at the beginning.

So, quite apart from the anomalies that can be thrown up by subsequent amalgamations, changes of name, transfers of engagement and the like—the ordinary flow of human life where organisations are concerned—there is also the fact that it is not compulsory for an organisation that meets the statutory definition of a trade union to apply to be included in the certification officer's list. Indeed, in his report for 1983 the certification officer noted that 60 trade unions had made annual returns for the year but had not applied to be listed. To the extent that any of those unions were constituent parts of other unions, they would, under this amendment, be exempt from the requirements of Part I of the Bill simply because they had not chosen to apply.

This is sufficient reason—there are, of course, others—to make it clear why the Government cannot accept the amendment. It would turn the simple proposition in the Bill, that Part I applies to all trade unions that meet the statutory definition save for certain federations, into a highly complex and (dare I say it?) highly Wedderburnian requirement depending upon an arbitrary test as to whether a union was listed on one particular date. For that reason, as well as for others that I could enumerate, although that seems to me to be the sterling one, I believe that the House should reject the amendment.

Lord Wedderburn of Charlton

My Lords, I beg the noble Earl to sleep on this with a turbulent mind. The date was not put in for Wedderburnian reasons. With great respect, it was put in for Gowrie-an reasons. If we had not put in a date and simply said that they are not on the list, people would have said that they could take themselves off the list and that the South Yorkshire area of the National Union of Mineworkers could get itself out of the Bill. We are trying to be severely practical. What the noble Earl has said must be considered by your Lordships. I am sure that another place will come back to it. This is a new amendment, remember; it has to go to another place.

Another place will now know from the Government that if a branch in Yorkshire turns out, according to the High Court and the tests in Cope v. Crossingham, a case of 1909 which I cited in Committee, and the definition in the legislation, to be a separate trade union, then that branch has to hold a separate postal ballot. What is more, it has to hold it without any duty to keep a register. It is told that you do not keep a register under subsection (3) of the new clause—a point to which the noble Earl did not address himself. I suggest, therefore, either that the new subsection (3) is taken out or that the Government, for heaven's sake, should stop this nonsense of putting an obligation for postal ballots upon sections, groups and branches of unions up and down the land.

We have objections to the postal ballot, yes, but for the purpose of this debate I am not questioning the postal ballot. I am saying, "Have your postal ballot according to the best rules and mechanisms, and, for goodness sake, think of some better ones". But the obligation should not be put upon branches up and down the land unless the wish is to kill the trade union movement in a flood of paper and especially to put it in a deliberate anomaly by saying that it does not have to keep a register but it does have to have a ballot. What kind of government is that? So far as the 1974 definition is concerned, the noble Earl should not be strangled with our definition. He can always change it. The Government can change anything; they have shown that. So far as our definition is concerned, I do not complain about it, but I shall not have an easy mind if I see it perverted by legislation that is quite absurd. I say that in all seriousness because this is a subject about which I care deeply. I do not want to see the trade union law of this country, irrespective of postal ballots, have this sort of thing put into it—a starting point.

I give the noble Earl one final illustration from the illustrations that I gave previously. The Clydesdale Bank staff section of the ASTMS has in paragraph 11 of the relevant rule a separate general committee by which its business is to be managed. It has for the Clydesdale Bank a union side and a joint committee with management, all within the union rules, clearly regulating relations with management. Is it the Government's intention that the Clydesdale Bank section of the ASTMS should have a separate postal ballot without any register? I have never heard such a crazy piece of legislation. I shall withdraw the amendment for a good reason. I believe that Hansard will disclose to the Government that there is a need to do something about this situation.

The Earl of Gowrie

My Lords, before the noble Lord withdraws the amendment—I am one of those most eager that he does so—I really think that for Hansard and the record we should get some things clear. The noble Lord has distorted what I said. I said that I was perfectly content with the definition in the 1974 Act. The noble Lord has been arguing that the Bill without his amendment will apply to every sort and condition of union branch—

Lord McCarthy

Many.

The Earl of Gowrie

—and that there will be confusion. His point is that the unions will be confused, that there will be confusion within them as to whether branches or sections are or are not covered by the legislation. That is what I find wholly unreal. The reality is that, in the vast majority of cases, the practical test of whether some particular part of a trade union is itself a trade union is quite simple. It is whether it is listed as such by the certification officer.

Lord McCarthy

No.

Lord Wedderburn of Charlton

No.

The Earl of Gowrie

Let me finish the point, and then the noble Lord can get up again. The vast majority of sections and branches of trade unions are not listed as trade unions because they have not applied to be listed. They have not applied because they know, and the members of branches and sections concerned know, that they do not meet the statutory definition. But the position is different in those sections of trade unions that retain a substantial degree of separate organisation and which, in practice, have separate executives and bargain directly with employers. Where such organisations meet the statutory definition of a trade union, it is clearly right that Part I of the Bill should apply to them irrespective of whether they happen to have chosen to seek listing by the certification officer. I do not think there is really so much difference between the noble Lord and myself as he is seeking to claim.

9.8 p.m.

Lord Wedderburn of Charlton

My Lords, I am not quite sure whether the noble Earl is sitting down, or I am sitting down, but I wonder whether I may address a questioning remark to him. As I understood it, at one point he said that one was a trade union only if one was on the list. But I think that was my misunderstanding, because he ended by saying that one was a trade union if one met the definition.

There are four features of trade unions which are entirely separate in law. One is the definition; the second is the listing; the third is the question of independence; and the last is the question of recognition. They are totally separate. It is quite right to say that one chooses whether or not one is listed. May I ask the noble Earl this. It is not meant to be a catch question, because his reply to me is that it is quite simple; there is no problem. Is the Clydesdale Bank section of ASTMS a separate trade union?

The Earl of Gowrie

My Lords, I do not know anything about the Clydesdale Bank section of ASTMS, and the noble Lord would not expect me to. The simple fact of the matter is that if it is engaged in the business of representing its members in negotiation with employers, and if it is elected by its members to do this, it will be covered by the Bill.

Amendment, by leave, withdrawn.

Clause 6 [Interpretation of Part I and transitional provision]:

The Earl of Gowrie moved Amendment No. 16:

[Printed earlier: col. 1075.]

The noble Earl said: My Lords, I have already spoken to this amendment. I beg to move.

On Question, amendment agreed to.

The Earl of Gowrie moved Amendment No. 17:

Page 8, line 8, at end insert— ("'offshore worker' means any person in employment to which section 127 of the Employment Protection Act 1975 (employment for purposes of activities in territorial or other offshore waters) applies, other than one who is in such employment in any area where the law of Northern Ireland applies'")

The noble Earl said: My Lords, with this amendment, I should like to speak also to Amendment No. 18. Amendment No. 18: Page 8, line 10, after ("seaman") insert ("or offshore worker").

These amendments will effect a relatively minor but nonetheless desirable modification to the Bill's application. They are designed to give trade union members working on offshore installations to which the law of Great Britain applies, the same voting rights under each part of the Bill as their colleagues in Great Britain itself. As such, they bring the Bill into line with earlier legislation. There can be no good reason why members of trade unions based in Great Britain, who are working in places were the law of Great Britain applies, should not benefit from the provisions of the Bill. Therefore I commend these provisions to your Lordships.

On Question, amendment agreed to.

The Earl of Gowrie moved Amendment No. 18:

[Printed above.]

On Question, amendment agreed to.

The Earl of Gowrie moved Amendment No. 19:

[Printed earlier: col. 1075.]

The noble Earl said: My Lords, in the previous debate I spoke to Amendments Nos. 19 to 22 inclusive. If it is the will of the House I would move these en bloc.

The Deputy Speaker (Lord Ampthill)

My Lords, the Question is that Amendments Nos. 19 to 22 be agreed to en bloc?

Lord Wedderburn of Charlton

My Lords, I have a question on Amendment No. 20, if I may address it to the noble Earl. It was raised on the previous amendment, which sets up the register, by my noble friend Lord Houghton when he commented that it was the duty of every union to maintain the register in the way there set out. One of the obligations of the union is to maintain a register with the proper address. Therefore, the "proper address" definition becomes a matter of some importance.

The noble Earl will know that the definition of "proper address", as in Amendment No. 20, says that it, means his home address or any other address which he has requested the union in writing to treat as his postal address". Will the noble Earl consider whether some time should be put in there? If, on the day of the ballot, he notifies the union in writing of a new postal address it is rather unfair to expect the union necessarily to get a postal ballot paper to him. Surely the provision should be that he request the union in writing at least some period before the ballot in order to be fair in the matter.

The Deputy Speaker

My Lords, the Question is that Amendment No. 19 be agreed to?

On Question, amendment agreed to.

Amendment No. 20:

[Printed earlier: col. 1075.]

The Earl of Gowrie

My Lords, without prejudice, if I may use that term, I will look into the point which the noble Lord has made, which may be well founded. Perhaps we can return to it at a later stage.

On Question, amendment agreed to.

The Earl of Gowrie moved Amendments Nos. 21 and 22:

[Printed earlier: col. 1075.]

On Question, amendments agreed to.

Clause 7 [Industrial action authorised or endorsed by trade union without reference to a ballot]:

Lord Wedderburn of Charlton moved Amendment No. 23: Page 9, line 39, at end insert ("otherwise than by reason of any failure which—

1. (i) was not caused by lack of reasonable care on the part of the trade union;
2. (ii) did not materially affect the result of the ballot; and
3. (iii) ought fairly and reasonably to be excused in all circumstances, having regard to the period of time available to the trade union following the date of commencement of this Part.").

The noble Lord said: My Lords, this amendment relates to that obligation of the union under Part II of the Bill which is required before it and its officials acquire legality for inducing or organising industrial action of any kind. There are three requirements in Clause 7, and this relates to the third; namely, the obligation to comply with Clause 8. In the interests of brevity I will say only this about Clause 8, to which this amendment and the clause refer. I know the noble Earl is constantly saying that the procedures under this Bill are really very simply, but I ask him to accept that there could be a situation in which many people in real life would find some difficulty and might make an honest mistake.

The noble Earl's reply to many amendments often is, "All you have to do is to obey the law". He did the same in 1980 and in 1982. A great deal of lawbreaking is unintentional, and if you pitch your duty too high then you catch people who in all fairness really should not be caught and who should be excused.

This amendment says that if the failure to abide by the procedures of Clause 8—it might be giving a ballot paper to a member to whom it should not be given, or it might be some honest mistake in the records which meant that someone failed to get a vote when he should have got it—was, first not caused by lack of reasonable care (and it is a very high standard that is required even by this amendment) and, secondly did not materially affect the result of the ballot; and if, finally, it ought fairly and reasonably to be excused, then the union should be excused. As regards that last matter, the period of time between the enactment of this measure or the coming into force of Part II and the default should be taken into account.

We say that for the following reason. To organise strike ballots under the procedures of Clause 8, whatever the noble Earl may think, will be a matter of some difficulty for some unions. Even if you take a union which wishes to comply and decides to comply in all honesty with this measure, it may have to change its rules or it may wish to change its rules, or in the interim before a change of rules it may find the procedure difficult to stomach, and yet this part is coming into force, at any rate as the Bill stands, within two months.

Perhaps a fault in our discussions is that we discuss unions as though they were some metaphysical entity. There are people involved; there are officials involved who are trying to do a job of work running unions and trying to do work for their members. If one of those union officials does something that he should not do under Clause 8, but does not mean to do it, if in doing it he did not lack reasonable care and ought to be fairly excused; and if it did not affect the result, then surely—if you take into account especially, perhaps, the length of time between the coming into force so rapidly of this part of the Bill and the time of perhaps three months after that date, when the union had not been able to change its rules—that official should not be laid open to the ravages of common law liability and damages. I insist that it is not just a question of union liability. The Government made it quite clear in Committee that they mean to make not just the union liable, but each official who is involved in the inducement of breach of contract or inducement of interference.

The noble Earl has said once before that all of this is covered by the words "reasonably practicable". I could only argue the opposite in detail by going through every measure. I merely put forward the proposition that if one looks at the Bill there is no defence of reasonable practicability which would apply to every one of the possible mistakes, and the proper measure is the type of measure that we suggest. I ask the Government to look at this sensibly, because if on their own premises—and I am not putting this forward as my argument—they really want to get some goodwill for this measure in Part II (and I suspect that it will be pretty hard to get) then not to include something of this nature would seem, even from their point of view, to be rather unwise. I beg to move.

The Earl of Gowrie

My Lords, I have to say that I rather doubt whether there will be immense practical difficulties standing in the way of compliance with the balloting provisions of the Bill. As the noble Lord has told us, balloting provisions are subject to tests of reasonable practicability. The provision of a voting paper and of a convenient voting opportunity to every member entitled to vote does not seem to me to present enormous difficulties. The requirement that voters should incur no direct cost to themselves seems to me to be fairly easy to ascertain. As regards the arrangements to secure the secrecy of the ballot, one would not need to be an immense expert in this field to satisfy oneself that those provisions were there. I should not have thought that it would be a very sophisticated judgment to decide that all those aspects could be reasonably and practicably seen to.

As a result of the amendments which we tabled during the Committee stage, no liability will result from any interference with the opportunity to vote by people outside the union—and that is something that we shall come back to in the context of the next amendment—and we have also tried to meet the noble Lord's well-found point (if I may put it that way) that a lot of law-breaking is the result of honest mistake rather than of venality of some kind. We have made it clear that there will be no penalty for any accidental miscounting of votes, providing this does not affect the result of the ballot.

Equally, there is nothing in Part II of the Bill to say that a voting register is the only way of ensuring that the provisions relating to voting are complied with. As an alternative to supplying a voting paper to each member, for instance, the union may if necessary make voting papers available at the workplace. And, as an alternative to postal ballots, the union may, as we saw from the debates before dinner, organise workplace ballots. Neither of these alternatives will necessitate a voting register so long as the trade union takes other precautions to ensure that all the balloting conditions are fulfilled—and they are the conditions which I have said are simple ones; and there is no need for a trade union to fear being held to be in breach of Clause 8 if it was not reasonably practicable to compile such a register in the particular circumstances of the case.

I think that I have said enough to explain why the Government do not believe that any need exists (in relation to the practical requirements set out in Clause 8 of the Bill) for any further mitigation of the obligation on trade unions to comply with those requirements. No doubt we shall come on to the other reasons why noble Lords opposite believe that commencement two months after Royal Assent is too soon, in the context of Amendment No. 40, and I shall then try to explain to the House my view that those also are unfounded. But in respect of this amendment, I believe that the noble Lord is worrying too much, and for the reasons that I have given I hope that he will feel able to withdraw it.

Lord Wedderburn of Charlton

My Lords, I am not reassured. I understand what the noble Earl says. Of course, he is right in saying that the Government inserted an, amendment to say that an inaccuracy in the counting should be disregarded if it is accidental. That is as far as they went. What is special about counting? Let us take the provision that every person entitled to vote in the ballot must be allowed to vote. That is fundamental. The Government want that. Let us suppose that an honest mistake is made that somehow removes the opportunity. The Bill contains nothing at all which, tout court, gives the union an escape. But I heard what the noble Earl said. It is the final word on this matter from the Government. In the eyes of many people the Government are being quite unreasonable. What they did for counting they should do for Part II. Where the mistake is without carelessness and is within the area of reasonableness, there should be a defence. They will not do that. On that basis, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 8 [Requirements to be satisfied in relation to ballots]:

9.27 p.m.

The Earl of Gowrie moved Amendment No. 24: Page 10, line 41, leave out ("at") and insert ("in").

The noble Earl said: My Lords, I beg to move this amendment, which is simply designed to make a drafting correction.

On Question, amendment agreed to.

Lord Wedderburn of Charlton moved Amendment No. 25: Page 11, line 22, leave out from ("interference") to ("and") in line 24 and insert ('or constraint").

The noble Lord said: My Lords, in congratulating the Government on the last amendment, we can also hope that they will look kindly upon this one which, for the purposes of sensible procedure, I apprehend should be taken with Amendment No. 28.

Amendment No. 28: After Clause 8, insert the following new clause:

("Statutory duty not to interfere or impose constraint.

.—(1) A trade union or other person contravenes this section if it or, as the case may be, he causes any interference to, or imposes any constraint upon, a member of a trade union in contravention of subsection (5)(a) of section 8 above.

(2) Subsection (1) does not create an offence but the obligation to comply with it is a duty owed to each of the following—

1. (a) a member of a trade union entitled to vote in a ballot under this Part; and
2. (b) a trade union or other person who may be adversely affected by the contravention;

and any such breach of duty shall be actionable accordingly (subject to the defences and other incidents applying to actions for breach of a statutory duty).").

My noble friend Lord McCarthy made some remarks to your Lordships earlier about this matter, and I shall remind your Lordships of it in this way. He raised the matter on Amendment No. 6. The Bill has always demanded that members must be allowed to vote without interference or constraint. Constraint is normally understood to be in the nature of a physical impediment, and obviously interference has a rather wider meaning. Indeed, interference has a much wider meaning, because when we looked at breach of contracts of employment and interference with contracts of employment, it was quite clear that the Government adopted the rather questionable doctrine that interference included anything that delayed or hindered the performance of a contract, even if there was no breach of duty. Therefore, it is quite clear that the Government take the very widest possible view of "interference" as a word, and nothing has ever fallen from their collective lips, as it were, which suggests that it is any different here.

Until quite a late stage in your Lordships' House the Bill was of that character. Indeed, that seemed to be quite sensible. As a matter of fact, the situation is rather more important here than when my noble friend referred to it under Amendment No. 6, because, although it may be important to ensure that a member votes without interference or constraint when he is electing his national executive committee, I would consider that the Government might take the view that it is even more important that he votes without interference or constraint when he is deciding whether or not to support a strike or industrial action. Therefore, this is a rather important provision.

The debates in another place—and the earlier debates here contain a reference to it—show that the interference referred to might be from the union, or from an employer, or from a third party. If we are looking at the position of industrial action, then, rather more realistically—or perhaps rather more possible than in the case of elections to the union national executive—there could be some interference by an employer or third party with an interest in the dispute. One wants to prevent that, and the Government's Bill always did so until a late stage in this House.

One would want to avoid, for example, the situation where an employer said to members of a union, "Don't vote for this suggestion, or I won't engage you". I take that example deliberately because it does not run into the rather obscure question of an existing employee being told, "Don't vote for this, or I won't give you overtime", or the like, because that could conceivably be within present legislation. I do not take that example because that would run us into a legal argument, which the noble Earl tonight seems rather willing to have.

I take the example of, "Don't vote for that, or I won't engage you", because that is clearly not within the existing legislation. I say that that is interference, and the Bill once covered that but does not cover it now. In a late amendment the Government have brought in a formula which is quite different. Your Lordships will find in both Parts I and II the formula that members and workers involved in the strike here are to be allowed to vote without interference or constraint by the union or its officials or employees.

The Government argue that that is to protect the union. We quite understand that. Over the interference or constraint we were perhaps all at fault in not noticing the obscurities. But we say that if you are going to make this clearer, why do you impliedly permit interference from outside by the employer or third parties? Accepting that the union must not constrain and must not interfere—and note that it is not just intereference by unlawful means: it is the same point we had in regard to the contract of employment; it is interference generally—what about the employer who makes threats that are not unlawful for some other reason? Is that to be allowed?

What about third parties who take action to interfere with trade union elections and with, here, decisions to strike or not to strike? It goes further than that. Existing legislation, which is relevant to this Bill, includes the same formula. The regulations for the funds for trade union ballots which the certification officer administers—not an administration that will be improved by this Bill if these amendments go forward and are enacted—are regulations of 1981 and 1982. Those regulations in 11(d) state that those entitled to vote must be allowed to vote without interference or constraint. If you do not do that, then you cannot get the money from the certification officer. Are the Government going to amend that to "interference or constraint by the union or its officials or employees"? If not, why not?

What we have done in these amendments is to propose that the Government's original formula be accepted; that interference or constraint be generally regarded as obnoxious. The only way we can seek to do that (and this takes one to Amendment No. 28) would be to adopt the Government's type of formula, which they have used many times—to make it a wrong, and not a criminal wrong, but a civil wrong, in regard to the duty owed to the members of the union and any other person, including the union, who might be adversely affected—not to interfere with, or to constrain, members in respect of elections.

That is a method of doing it. If the Government have a better method for adopting their original and better proposal, then that is splendid. What will not do is for the Government merely to tell us that they have changed the formula to protect the union. They have changed the formula to protect the union, with the consequence that third parties are clearly, on interpretation of the Bill, no longer covered and no longer owe a duty not to interfere. It is on that basis that I beg to move this amendment.

Lord Rochester

My Lords, I rise simply to ask the noble Earl whether there is anything to be lost by the Government accepting the point that has been made by the noble Lord, Lord Wedderburn, so that it can be shown that they are even-handed in their approach to this matter and will not brook interference or constraint from any quarter.

The Earl of Gowrie

My Lords, Amendment No. 25 would have the effect of reverting to the position before the Government's Committee stage amendments whereby a trade union could be held liable for interference or constraint imposed by a third party. Amendment No. 28 would impose a statutory duty on all persons, including employers, not to interfere with or constrain union members' ability to vote.

It seems to us that Amendment No. 25 would be undesirable from the trade union point of view. Whatever may be said on Amendment No. 28, Amendment No. 25 would have the effect of reimposing liability on a trade union for actions over which it has no control. Immunity depends on all the provisions in Clause 8 being satisfied, and we know of these from the last debate. The union could, therefore, lose its immunity as a result of Amendment No. 25 through the actions of third parties. I would be very puzzled if I really believed that the noble Lord, Lord Wedderburn, wanted that to happen.

In relation to Amendment No. 28, which is designed to add not only a new clause but also a completely new dimension to the Bill, of course I endorse the sentiments behind it, and I am glad that the noble Lord, Lord Rochester, has given me the chance to underscore that. It is clearly desirable that trade union members should be able to vote without interference or constaint from any source. But the amendment we are considering here could have all sorts of unexpected ramifications. For example, what about the employer who has good reason for not wanting to release his employees to vote at the particular moment nominated by the trade union? Is he to be bound by this provision to accept any balloting arrangements which the trade union chooses to nominate without having any say in the matter?

Section 2 of the Employment Act 1980 presently gives trade unions the right to request the use of employers' premises for ballots on a number of matters, including industrial action. An employer who refuses such a request may be required to pay compensation to the trade union except where it can be shown that it was not reasonably practicable to accede to the request. But in the new clause proposed here, the employer would be liable for any constraint on the union members' ability to vote, whatever the practicalities of the situation—even, for example, where a trade union had arranged a ballot which would require all union members to be absent from work at the same time and where this would seriously disrupt the production process.

We should therefore draw our minds back and concentrate on the main purpose of the Bill, which is to ensure that trade unions make proper arrangements to ballot their members. I am sure that the motives of the noble Lords opposite are admirable, and, indeed, I share some of them. But I cannot recommend that your Lordships accept, at this very late stage, a particular bolt-on addition to the Bill. In the light of what I have said about the Government's reasons for modifying the original reference to interference and constraint, I hope that both amendments will be withdrawn.

Lord Wedderburn of Charlton

My Lords, this is perhaps one of the most disappointing answers throughout the long course of disappointing answers in this Bill. If the noble Earl thinks that the amendment as drafted would have the ludicrous effect of possibly making a union liable for the act of a third party then of course, he can easily propose two or three extra words to stop it. That is the first point.

Secondly, anyway, I do not believe that Amendment No. 25 would mean that, in the context of Amendment No. 28. And I think that that is clearly the better reason. Thirdly, he says that this introduces a new dimension to the Bill. Why? He says that he endorses the sentiment behind it! I think that I quote him correctly. "Endorses the sentiment behind it"!—We are not dealing with sentiments; we are dealing with legal liabilities. It is either desirable to stop interference from any source or it is not.

The Government really cannot tell us that they do not pick on trade unions if they now, by an amendment after eight months, say, "Oh well, the interference is only dealing with the union itself"—and they do so in that terrible way, the worst way by which you reject a candidate, which is always to say that it is in his own best interests. "Of course, it is in the union's own best interests" that they be protected by this formula, interference by the union, its officials or employees. The noble Earl then says that it will create anomalies. He says, "Let us suppose that you take the case of the employer who for some good reason cannot release all the workers for the date when the union wants to hold a ballot". I hope that I reasonably accurately summarise his example.

We moved an amendment in Committee which suggested a form of words which would deal with the situation where the employer was being reasonable or unreasonable in respect of the union's liabilities under Part I or II of the Bill. We suggested that where the employer was unreasonable there should be one result, and that where he was reasonable there should be another. If the noble Earl wishes to put that back in, if he wants to adopt our amendment now, then that is splendid. Our draft is defective. But how on earth can anyone, unless he is bound hand and foot, without reason simply to have to reject amendments, reject amendments of this kind completely—other than saying that he wants to improve the drafting or that he wants to take in an amendment that we moved before and was rejected—when he says that it is desirable to reach this result? Presumably it is desirable in law; because that is what we make here. We do not make sentiments, we make laws and they bind real people. These real people are going to be people who vote; and they are people who vote under the provisions of this Bill, upon strikes and industrial action.

There will be some of them—and I say this now with confidence—just as no doubt there will be cases where some union official puts some interference into the process, who are interfered with or constrained by employers or third parties. We say that there should be a legal duty not only that those members should have a right but that the trade unions should have a right to say that the third party shall not interfere in its elections. That is what our amendment says. Any person, the union or a member or any other person adversely affected, should be invited to stop it. The Government are not serious. I beg leave to withdraw the amendment.

The Earl of Gowrie

My Lords, before the noble Lord sits down, I may not be able to satisfy him but I might be able to reduce his disappointment to some degree because my advice is that as a result of what he suggests I may need look again at the wording of the regulations on funding of ballots. I am sure that that is not even half a loaf, but I do not want to spoil the noble Lord's evening altogether.

Amendment, by leave, withdrawn.

The Earl of Gowrie moved Amendment No. 26:

Page 11, line 25, leave out from ("practicable") to end of line 6 on page 12 and insert ("be enabled to do so without incurring any direct cost to himself. (6) So far as is reasonably practicable, every person who is entitled to vote in the ballot must— (a) have made available to him—

1. (i) immediately before, immediately after, or during, his working hours; and
2. (ii) at his place of work or at a place which is more convenient for him;

or be supplied with, a voting paper; and

1. (i) a convenient opportunity to vote by post (but no other opportuntiy to vote);
2. (ii) an opportunity to vote immediately before, immediately after, or during, his working hours and at his place of work or at a place which is more convenient for him (but no other opportunity); or
3. (iii) as alternatives, both of those opportunities (but no other opportunity).")

The noble Earl said: My Lords, I am so dazed by having tried to help the noble Lord, Lord Wedderburn, that I have lost my place in the brief! This amendment makes a number of drafting changes. It will improve the drafting of the provisions to which it relates and bring them in line with those applying in Part I. I beg to move.

On Question, amendment agreed to.

The Earl of Gowrie moved Amendment No. 27: Page 12, line 43, leave out ("and")

The noble Earl said: My Lords, this amendment removes an extraneous "and". I beg to move.

On Question, amendment agreed to.

Lord Wedderburn of Charlton had given notice of his intention to move Amendment No. 28:

[Printed earlier: col. 1129.]

The noble Lord said: My Lords, I spoke to this Amendment with Amendment No. 25 and it went with it. It may be technically not moved but I mention this that it may be printed.

[Amendment No. 28 not moved.]

9.40 p.m.

Lord Aylestone moved Amendment No. 29: Before Clause 9, insert the following new clause:

("Amendment of 1913 Act s. 5.

.—(1) For sections 5 and 6 of the 1913 Act there shall be substituted the following section—

"5. —(1) A member of a trade union may at any time give notice that he wishes to contribute to the political fund of the union and, on the adoption of a resolution of the union approving the furtherance of political objects as an object of the union, notice shall be given to the members of the union acquainting them of the procedures for contributing to the political fund of the union, and that an appropriate contribution form can be obtained by or on behalf of a member either by application or by post from the head office or any branch office of the union or from the office of the Certification Officer.

(2) Any notice under subsection (1) above to members of the union shall be in a form, and shall be given, in accordance with the rules of the union approved for the purpose by the Certification Officer, having regard in each case to the existing practice and to the character of the union.

(3) Effect shall be given to the wish of members to contribute to the political fund of a union by a separate levy of contributions to that fund from the members of the union who have completed the contribution form referred to in subsection (1) above, and the rules shall provide that no moneys of the union other than the amount raised by such separate levy shall be carried to that fund."

(2) For the purposes of section 5 of the 1913 Act (as substituted by the preceding subsection) any trade union which has adopted such a resolution as is therein specified shall be deemed to have adopted the same on the day when this Part of this Act comes into force.").

The noble Lord said: My Lords, at Committee stage, at about two and a half hours later than this hour, we discussed this same amendment, and I then discussed it briefly, which I propose to do now. We purposely put it down again so that we could study what the Minister said in his reply to the amendment. The noble Lord, Lord Underhill, and the Minister both spoke on that occasion and we have read carefully what both of them said. The subject matter of the amendment is pretty well known because it has been discussed on every occasion when we have had an industrial relations Bill before us, but I am afraid that the result has been the same. We have never got anywhere with it but let us hope that on this occasion tonight it may be easier.

The position is this. The Trade Union Act 1913 permits a trade union, after a ballot, to set up a political fund. Members of the union who desire not to pay into that fund may, by signing a form known as a "contract out", contract out from paying into the fund. But we know from experience and from the figures that are provided that the number of people who contract out from paying into the political fund is very small indeed. One accepts that the majority of members of the unions who pay into the fund contribute to it at the request of a branch officer or of their colleagues or mainly, perhaps, because they have no desire to be any different from their workmates. Many thousands of members who pay would certainly not do so if it were possible for them not to have to go through the procedure of applying for a contracting out form, which can be difficult—I put it no stronger than that. I would not use the word "intimidating".

What may be the difficulty, one may ask? The difficulty is the one I have described. It is never very easy in the company of colleagues to say, "I do not wish to pay into this political fund because all the money goes to one political party which I do not support nor yet vote for". The amendment on the Marshalled List simply amends the 1913 Act and alters the procedure so that those members of trade unions which have a political fund and who wish to pay into it, to make the contribution, can do so by signing another type of form, a contracting in form.

There is a view held in the official circles of many trade unions that contracting out is not a fad and is as democratic a system as contracting in. It is a view which we on these Benches share. How can it be possible, if one is more or less in one way or another forced to contribute to a political fund, to go through the procedure of contracting out? One can understand the view of the Official Opposition when they oppose it. We do not bite the hand that feeds us. That is precisely the position at the moment with the fund.

Nor, on the other hand, can we quite understand the Government's attitude, having read what was carefully—unquestionably carefully—said by the noble Earl when he replied previously. If I paraphrase him, he said that contracting out does not safeguard the position of those who have no desire to pay. With that we agree absolutely, but the Government seem to have taken no action to put that right other than to reach some sort of agreement, which we understand is called Statement of Guidance for the Trade Unions, presumably with the TUC—a system whereby all that the unions have given an undertaking to do is to make contracting out more clearly understood by their members.

What that may mean is difficult for us to appreciate. It can mean nothing; on the other hand it can mean a trade union official speaking to every one of his members and explaining, "If you don't want to pay, this is the way to stop it". We think that would be hardly likely to apply. So in fact the statement of guidance which the Government have apparently negotiated with the unions to prevent dealing with the question of contracting out is fairly worthless.

I should like, in speaking to this amendment, in absolute fairness to refer to a later amendment, No. 42, which stands in my name and those of my noble colleagues, because we would regard it as being absolutely fair—and I am aware that the official Opposition have a somewhat similar amendment down—to say that shareholders of companies which make a contribution to a political party are not always aware (in fact they may seldom be aware) of the political party to which that sum of money is being paid.

The Companies Act 1967 requires companies to state whether they make charitable or political contributions, but it does not require them to say to which political party they are made. We do know where the money goes that is paid into trade unions' political funds, and we feel it would be an absolute fairness to hold and wait for any adjustment made to the present political fund arrangements from contracting out to contracting in, until such time as there has been a change in the 1967 Companies Act. We appreciate that may take some time, but we think it is probably the only fair thing to do. So I beg to move this amendment and I would ask your Lordships on all sides of the House seriously to consider whether contracting in is not a more democratic and fairer method than contracting out. I beg to move.

Lord McCarthy

My Lords, the noble Lord, Lord Aylestone, says—and, with great respect, I have to say that I resent this—that we on this side of the House will oppose his amendment because nobody bites the hand that feeds him. This is not the basis on which we oppose this amendment. We oppose it on grounds of equity, on grounds of comparison and on grounds of the undertakings which the Government have given to the trade union movement.

The noble Lord, I am afraid, has got those undertakings rather wrong and I am afraid that I have to begin by repeating with approval what the noble Minister said on 25th June, at column 754 in Hansard. He was referring in particular to the very specific undertakings which were given to the TUC in their negotiations with the Secretary of State for Employment, and he said this: In the discussions which followed, the TUC indicated that they were willing to take remedial action and they put before the Government a draft statement which was subsequently endorsed by the General Council. My right honourable friend the Secretary of State for Employment told the TUC that, provided this statement was endorsed and issued to member unions with their committed support, then the Government would not make changes in this Bill to the law on contracting out". Of course, that is not quite true, or rather the Government did not totally observe that undertaking because, as we said at Committee stage, the Government did introduce an amendment to effect contracting out, to make it much easier for workers to contract out; now all they have to do in situations where there is a check-off (which affects 75 per cent. of trade unionists) is to inform the employer that they want to contract out. Nevertheless, having made that concession, the Government are under an obligation to make no more. The noble Earl went on to say: But he [the Secretary of State] also made it very clear to the TUC that this undertaking was given only on the understanding that the TUC guidance proves to be effective. If it does not, then the Government reserve the right to introduce legislation to guarantee the free and effective right of choice. As the Secretary of State has also observed, the case for legislation in the event that the TUC's guidance proves ineffective will be immeasurably strengthened by the fact that they have first been offered a voluntary arrangement". Then the Minister explained in some detail what the TUC's statement of guidance involves. He said that it is designed to ensure three things: that trade union members are aware of their rights; that no difficulties are placed in the way of those who want to exercise those rights; and that more information is available to union members about how political contributions are spent". If the noble Lord, Lord Aylestone, wants to see the TUC's statement of guidance, it is available to him.

The noble Earl concluded: We should now give the TUC's guidance a chance to operate, and we must all hope that it will be effective. But if it is not, then as my right honourable friend has made clear, we reserve the right to bring forward further legislation, and if we do so then it will be on the basis of proven need". We stand upon that. If that is what the Government say, if that has been accepted, then our first basis for opposing this amendment is that the Government must observe their undertakings. They must observe the promises which they have given to the Trades Union Congress in respect of contracting in and contracting out.

My second argument would be that, as is very rarely ever admitted by those who introduce proposals for changing the system of contracting in and contracting out, in this one field we have had ever since 1913 a proven system of remedying the grievances of those who say that they have been discriminated against, or have lost their job, or have lost their job rights, and so on, as a result of refusing to pay the political levy or as a result of trying to contract out of paying the political levy. This is one of the functions of the certification officer. It is one of the reasons why we for our part, on this side of the House, have tried to keep the certification officer out of the controversial parts of this Bill. Nevertheless, this proven system exists, and, as my noble friend Lord Underhill said when he spoke to this amendment at the Committee stage, we know, as a result of the activities of the certification officer, that there is no escalation or increase in the number of complaints from people about the operation of this system.

In 1980, the certification officer had 20 complaints, in 1981 he had 12 complaints, in 1982 he had 21 complaints and in 1983 he had 23 complaints, of which only a small minority dealt with the failure to refund, most of which were incorrect and dismissed because they were based on incorrect facts, and none of which required a formal hearing to put it right. I do not expect noble Lords on the other side of the House to accept it when I say this, but I say it all the same: these figures are the consequence, the result, the upshot of a ceaseless campaign which is put forward with considerable amounts of money and a great deal of effort by the Freedom Association and many related bodies, seeking to find to the best of their ability complaints to the certification officer about contracting in—and what do we find? We find that in 1980 there were 20, in 1981 there were 12, in 1982 there were 21 and in 1983 there were 23 and not even a single formal hearing. Those are the facts of the situation.

Of course, the situation has now been changed to the advantage of the person who wants to contract out, because, as a result of the Government in some measure going back on the undertaking which they gave to the Trades' Union Congress, as a result of an amendment which we have passed in this House, all a member needs to do now if he wants to contract out is to inform his employer. His employer is under a legal obligation to strike him off the check-off and to let him contract out without further ado, so that he can either drop out if he has not got a check-off, refuse to pay if he has not got a check-off, ask the employer to take him off if he has a check-off, and if he is in any difficulty go to the certification officer. All the evidence we have is that unions observe the rulings of the certification officer and that there are very few such rulings.

Finally, I come to the argument on comparison. As a result of this Bill there will now exist a unique degree of limitation on the exercise of what I prefer to call political rights among trade unions. As a result of this Bill, we shall have a comprehensive definition of what is to count as political purposes and as political objects from the point of view of restricting the extent to which trade unions can spend on political objects out of their general funds. These limitations are of a kind that do not exist in respect of employers or any other type of organisation in this country. We now have a unique degree of limitation.

We now have a virtually watertight, automatic way in which anyone who wishes to do so can contract out of the obligation to pay for those political purposes, and we have an undertaking from the Government to observe the application of that system under the TUC guidelines and wait to see what happens. In those circumstances, I do not see how any fair-minded person can support this amendment.

9.56 p.m.

Lord Boyd-Carpenter

With due respect, I do not think that the noble Lord, Lord McCarthy, can get away with the age-old argument that because there have been only a limited number of complaints in connection with contracting out, that means that there is very little cause for complaints. The essence of the situation (and I believe that many of us have come across this, and certainly those of us who served in another place came across it in our constituencies) is that one does encounter trade union members who are nervous of exercising their right to contract out because of the reaction of their workmates. If that is so, they will of course be equally nervous of making a complaint, because the fact of their making a complaint will quickly become known to their workmates. Although it is a nice superficial argument that there are only a limited number of complaints and so there cannot be much trouble, it is an argument which entirely ignores the realities of the sitation.

The situation is a strange one. The noble Lord, Lord McCarthy, will remember that there were published recently certain interesting statistics as to the proportion of members of particular unions who contributed to the political levy. Certain branches of the Transport and General Workers' Union showed a figure of more than 90 per cent. In at least one case the figure was 100 per cent. It really passes human belief that all that proportion of members of those particular unions were such enthusiastic supporters of the Labour Party that they desired to contribute. It is a very obvious inference that they paid because of the pressure upon them.

I confess that I am very unhappy about the system of contracting out. The situation is undoubtedly made difficult by the arrangements which my noble friend and the Government have made with the TUC. I certainly would not wish to press the Government to break that agreement, although I am extremely sorry that they ever made it. But the Government have made that arrangement and so they are morally bound by it—unless, as may well be the case, the TUC fails to deliver the goods.

It is because of that situation that I cannot, however regretfully, support the amendment of the noble Lord, Lord Aylestone; because it would place the Government in the position of being forced to break their word. Whatever noble Lords opposite may think of Her Majesty's Government, I am sure they would agree with me that honourable men do not break their word, and that the members of the Government are honourable men.

I will make only one further comment on the speech made by the noble Lord, Lord Aylestone, in respect of the habitual, facile and somewhat misleading analogy between company political contributions and the trade union levy. There is surely a very substantial difference. If a shareholder in a company objects to a political contribution, he can attend the company's annual general meeting and object. But, more practically, he can sell his shares and invest in another company which does not make the contributions of which he disapproves. That is a totally different position to a man working in a particular trade who has no alternative place to which he can go. Therefore, the analogy with companies—though it seems to me it is an obvious one and has a touch of superficial fairness about it—is really rather a bad one. Companies now have to report when they make political contributions, their shareholders can ask questions about it, or their shareholders can realise their shares and invest elsewhere. I should have thought that there is very little need, whatever is done regarding the political levy in the unions, for further legislation in respect of companies.

Coming back to the main point, if the matter were open and free I should have been very happy to support the noble Lord, Lord Aylestone, and I very much respect him for having brought this amendment forward, but I think the Government have made it rather difficult for some of us.

Lord McCarthy

My Lords, before the noble Lord sits down—because he did refer to what I said—may I ask him whether he appreciates that he has done it again? Does he appreciate what we have had to put up with throughout this Bill? He comes across men, you do get men, he knows these chaps—we are never told their names or the circumstances; we live in a fog of generality.

Lord Boyd-Carpenter

My Lords, I can only say that the noble Lord, Lord McCarthy, has done it again because I have heard him make that precise point at least twice before. I can only tell him as a matter of human experience that in the days when I was a member of another place I spoke to people in that position in my own constituency, and I have had discussions with them. The noble Lord must take it from me.

Baroness Seear

My Lords, the noble Lord rejects the analogy with the contributions made by companies. Of course, it is not a precise parallel, but why should the shareholder who strongly disapproves of money being paid to a political party by the company in which he invests, either have to put up with that or else sell the shares in a company which is profitable to him and in which he wishes to invest? It is surely not part of the purposes of a company—or I would not have thought it was a proper part of the purposes of a company—to support political parties as such. Quite apart from that argument, if, as the noble Lord, Lord Boyd-Carpenter, says, he disapproves (as we on these Benches disapprove of contacting out—we would prefer to see contracting in) surely it is obvious that to be even-handed with employers, even if the parallel is not precise, is going to have a far greater impression of fairness to people to whom you are appealing to make this change than if you say you are applying it only to the trade unions.

The noble Lord, Lord McCarthy, gave us the figures of not complaining as if this were the only fact on which to base the case against contracting out. It would be very much more interesting if he gave us the figures for what happens to contributions to the political levy during the period when contracting out was removed. That gives a much better idea of the genuine support, surely, for contributions to the political fund.

May I also make the point that I was surprised that the noble Lord, Lord Boyd-Carpenter, felt that this House should be bound by an arrangement which had been entered into between the Government and—

Lord Boyd-Carpenter

Would the noble Baroness allow me to intervene? I think she misunderstood me. I should never venture to suggest that the House would be bound. I merely said that I felt bound if it came to a vote.

Baroness Seear

My Lords, I accept the point which has been made by the noble Lord, Lord Boyd-Carpenter. But surely one has to make the point to the noble Lord, Lord McCarthy, as well as to the noble Lord, Lord Boyd-Carpenter, that the law of this land is not made by agreements between the Government and anybody else outside Parliament, but is made inside Parliament. Therefore, the whole basis of the argument of the noble Lord, Lord McCarthy, falls to the ground.

Lord McIntosh of Haringey

My Lords, perhaps I may refer back again to the noble Lord, Lord Boyd-Carpenter. All of us in this House—because the Cross-Benches are empty—have made a political commitment, and some of us receive opprobrium because of our commitment. Will the noble Lord consider (I know he is in no position to reply, but perhaps he will consider in his mind) whether the difficulties involved in contracting in may not be greater when the problem of opprobrium among workmates and among employers arises, and whether the personal difficulties which he described so graphically might not be greater with a system of contracting in?

10.6 p.m.

Lord Houghton of Sowerby

My Lords, had it not been for the Conservative Party we should already have had a change in the financing of political parties. It was a Conservative Party in Opposition that stood in the way. The Liberal Party and the Labour Party were both committed to state aid. Michael Foot, in his latest book, reiterates that. I presume that the Liberal/SDP Alliance is in favour of changing the basis of financing our political parties. It is the Government party, therefore, that stands in the way.

Quite honestly, all this talk about reforming the political levy and changing the form of contracting in or out, or the exclusive use of the funds of the political levy for the Labour Party, and so on, is all a waste of time because the changes that will have to be brought about will be quite different from that. It does not matter whether we have contracting in or contracting out, the political fund is still objectionable in modern terms. Moreover, the funds of one of the principal political parties are at stake. This was described recently as the drip-feed of the Labour Party, and that is what it is. Any change which may affect the finances of a major political party is not a trade union matter, it is a political matter.

I have pleaded before, and I do so again. Why can we not leave it where it is, for the moment at any rate, and see how it goes? I do not think this is a solution: it is purely a face-saver or a stop-gap, or whatever one likes to call it. It is not a solution but merely a tiding over to a later date when we shall have to consider this matter more fundamentally. We are the only political system in Europe that has this affiliation of the trade union movement to a social democratic party. Indeed, throughout the world in parliamentary democracies some form of state aid is available. Our present system is completely outdated, due to the obsession of the Conservative Party at the time, which it has discarded since, for the voluntary principle. We have been discussing the voluntary principle today all right! And we have been discussing the voluntary principle on other legislation recently. Really and truly, the Tories do not believe in the voluntary principle, except when we get a matter like this cropping up and they think that the Labour Party ought to do without the levy on the trade union members, and so on.

There is a great deal about the political levy that is objectionable which has not been disclosed so far, and I would not disclose it in front of the children. We must adjust ourselves to the more fundamental reform, cut the cackle on the political levy and consider what the real purpose of our political activities in our democracy is going to be.

Lord Mayhew

My Lords, I feel sure that I am speaking for a number of my noble friends in saying that if we had an adequate system of state finance, as the noble Lord, Lord Houghton, suggests, we would be far less inclined to keep the House up tonight on an amendment about contracting in rather than contracting out. As it is, although I am diffident about intervening in a debate on industrial relations, I have been rather provoked by the remarks of the noble Lord, Lord Underhill—

Noble Lords

Oh!

Lord Mayhew

I am sorry, my Lords, I meant the noble Lord, Lord McCarthy. Both are former colleagues of mine who, I am afraid, I have failed to identify. The point about the speech of the noble Lord, Lord McCarthy, as far as I was concerned, was that he stirred echoes. He reminded me that four or five decades ago I was myself using the same arguments in favour of contracting out. Indeed, I have to confess that in another place in 1947 I actually voted for contracting out. This is what diplomats call an explication de vote, about 37 years late.

I should like to try to indicate to the noble Lord, Lord McCarthy, why some of us feel that it might have been right to vote for contracting out four or five decades ago but are now completely convinced that it is wrong. This issue is not only an issue of principle, as my noble friend Lord Aylestone was saying; it is not only an issue of democracy and justice. It is an issue of money and power. There is no question about that. Contracting out as against contacting in increases the political power of the unions and the political power of the Labour Party; and that is what it is about.

Four or five decades ago sensible people could argue that it was in the interests of the great majority of the British people that the political power of the unions should be increased.

Lord Mottistone

My Lords, is the noble Lord not veering off to make a Second Reading speech? Is this not a particular amendment at Report stage rather than a debate on principle? Would it not be rather quicker if the noble Lord was not making a Second Reading speech?

Lord Mayhew

My Lords, my contributions in this House on the subject of industrial relations are extremely few and very brief indeed. What I am saying is very relevant to the amendment. I am arguing that contracting in would reduce the political power of the unions and the Labour Party, and I believe that to be right at this time. I believe that great changes have taken place in the past 40 years. Instead of greater political power for the unions being in the interests of most working-class families in this country, it is against their interests today. In those days, and when I was campaigning with the unions in the countryside before the war, a person could be sacked for joining a union. Now people can be sacked for not joining a union. The whole thing has changed completely. Arguments that were relevant and important 40 or 50 years ago, such as those used now by the noble Lord, Lord McCarthy, are no longer relevant, useful and valid today. Therefore I very strongly support this amendment.

The noble Lord, Lord Boyd-Carpenter, said that over 90 per cent. of the membership of some unions had contracted in and were payng the levy. He did not say that in some unions only 15 per cent. pay the levy. How does one account for that? The noble Lord, Lord McCarthy, has not accounted in any way for that extraordinary discrepancy between one union and another, over 90 per cent. paying the political levy in one and only 15 per cent. in another.

As my noble friend Lord Aylestone said, the time has surely come to change that system to enable people to decide whether they wish to join the Labour Party instead of asking them to decide whether they do not wish to do that. It is a simple issue. In the conditions today, where the power of the unions is not only too great but is known to be too great, and said to be too great by the great majority of trade union members, let alone the general public, it is time for a change.

The Earl of Gowrie

My Lords, whatever the differences between us, I think that all of us in Parliament are something of a family, and there is nothing that a family more enjoys than a nice squabble about money. I myself must hesitate to draw your Lordships' attention to my opinions on this issue. I am sure that then others would jump up and we could prolong this agreeable squabble through most of the night. I think that the fact of the matter is a simple one, but I cannot, I think, come to it without drawing the attention of the House to a genuine and unusual phenomenon of political change which has taken place. If one looks at these Committee and Report stages of the Bill, and if one wants to read the fiercest speeches against trade union practices and procedures on this and many other issues, one finds them coming not from my noble friends or myself but from previous Ministers in Labour Administrations. I simply draw that to the attention of your Lordships for what it is worth.

Lord Dean of Beswick

Would the noble Lord give way? I am grateful to him for giving way. He must be aware that two of those ex-Ministers have just spoken.

The Earl of Gowrie

That is precisely why I drew the House's attention to the point. But I had in mind not only the previous Chief Whip and the previous Defence Minister but also the noble Lord, Lord Harris of Greenwich, and the noble Lord, Lord Houghton, in another context and the noble Lord, Lord Marsh, earlier today. If the House does not draw its conclusions from this, I have no doubt that the country will.

The issue here is a simple one. Amendment No. 29 would replace the existing system of contracting out of paying the political levy by one of contracting in. The Government sympathise with the amendment and our feelings about it were admirably summed up in the words of my noble friend Lord Boyd-Carpenter. However, the issue is not that we are against unions supporting the Labour Party. It is my belief that the bulk of union members would probably wish to continue to support the Labour Party, and that would be an admirable thing from their point of view perhaps to do. The issue for us is the individual rights of individual members of unions. Both my noble friend and the noble Lord, Lord Aylestone, have made a powerful case that the contracting-in system would protect those individual rights better. That is why the Government have very considerable sympathy for the amendment. We share the view that contracting out has not always worked as it should. That is why we promised in our election manifesto to discuss the problems with the TUC. As a result of those discussions, the TUC issued guidance to its affiliated unions designed to ensure that all union members were aware of their rights and able to exercise them freely and effectively.

I want to lay great emphasis on this manifesto commitment. We did not make a commitment to make this change. We made a commitment to discuss it with the TUC and as a result of the discussions we have undertaken to hold our hand on legislation, to change the present contracting-out system while reserving the right to legislate in future should the guidance which they have issued not prove to be effective.

We are not in business to clobber the unions or the Labour Party in this respect—though in many other respects we are precisely in business to clobber the Labour Party. What we are trying to do is to see that unions treat their own members fairly, and if they do not treat their own members fairly, as they have undertaken to do, we shall be watching and we shall be waiting with legislation which would, I imagine, in many respects be very similar to the kind proposed by the noble Lord, Lord Aylestone, tonight. But meanwhile it would be wrong in our view to damn the unions out of hand and, as I say, we shall be watching and waiting.

Lord Aylestone

My Lords, at this time of night I do not intend to reply to the question that has been put to me about why some of us left the Labour Party. There is a case to be put there that can perhaps be discussed not here but outside on some other occasion. All I want to say in closing the discussion on this amendment is that our real concern is not with the people who pay the political levy to whomever it may go. We are concerned about the people who pay the political levy to parties to which they would prefer not to contribute. Under those circumstances I think the House should test the position by calling a Division.

10.19 p.m.

On Question, Whether the said amendment (No. 29) shall be agreed to?

Their Lordships divided: Contents, 25; Not-Contents, 54.

DIVISION NO. 4
CONTENTS
Airedale, L.	Lloyd of Kilgerran, L.
Ampthill, L.	Mayhew, L.
Attlee, E.	Ogmore, L.
Aylestone, L. [Teller.]	Robson of Kiddington, B.
Beaumont of Whitley, L.	Rochester, L. [Teller.]
Chandos, V.	Saltoun, Ly.
Diamond, L.	Seear, B.
Foot, L.	Simon, V.
Gladwyn, L.	Tordoff, L.
Grey, E.	Wigoder, L.
Grimond, L.	Wilson of Langside, L.
Hooson, L.	Winchilsea and Nottingham, L.
Kilmarnock, L.

NOT-CONTENTS
Airey of Abingdon, B.	Hatch of Lusby, L.
Avon, E.	Hornsby-Smith, B.
Bauer, L.	Irving of Dartford, L.
Belhaven and Stenton, L.	Jeger, B.
Bellwin, L.	John-Mackie, L.
Belstead, L.	Kissin, L.
Birk, B.	Long, V.
Boardman, L.	Longford, E.
Boyd-Carpenter, L.	Lucas of Chilworth, L.
Brougham and Vaux, L.	McAlpine of West Green, L.
Caithness, E.	McCarthy, L.
Cameron of Lochbroom, L.	McIntosh of Haringey, L.
Carmichael of Kelvingrove, L.	Maude of Stratford-upon-Avon, L.
Carnegy of Lour, B.
Cockfield, L.	Mottistone, L.
Collison, L.	Murton of Lindisfarne, L.
Craigton, L.	Polwarth, L.
Dean of Beswick, L.	Ponsonby of Shulbrede, L.
Denham, L. [Teller.]	Ross of Marnock, L.
Eden of Winton, L.	Shannon, E.
Elliot of Harwood, B.	Skelmersdale, L.
Elton, L.	Stewart of Alvechurch, B.
Elwyn-Jones, L.	Stewart of Fulham, L.
Ennals, L.	Stoddart of Swindon, L.
Gallacher, L.	Swinton, E. [Teller.]
Glanusk, L.	Underhill, L.
Gowrie, E.	Wedderburn of Charlton, L.
Graham of Edmonton, L.

Resolved in the negative and amendment disagreed to accordingly.

10.27 p.m.

Clause 10 [Ballots: supplementary provisions]:

The Earl of Gowrie moved Amendment No. 30:

Page 14, line 6, at end insert— ("(1A) After subsection (1) of section 4 of the 1913 Act there shall be inserted the following subsections—").

The noble Earl said: My Lords, this is purely a drafting amendment. It simply makes clear that the subsections to which it refers are to be inserted into Section 4 of the 1913 Act and are not to be taken to be subsections of Clause 10 of the Bill. It will remove the confusion which caused the printers to number incorrectly the sub-paragraphs in an amendment to Clause 10, which was introduced during Committee stage. The amendment is designed to remove any cause of confusion when the Bill is read in future, as it will be very frequently. I beg to move.

On Question, amendment agreed to.

The Earl of Gowrie moved Amendment No. 31:

Page 14, line 15, leave out from ("practicable") to end of line 39 and insert ("be enabled to do so without incurring any direct cost to himself. (1D) So far as is reasonably practicable, every person who is entitled to vote in the ballot must—

1. (a) have made available to him—
   1. (i) immediately before, immediately after, or during, his working hours; and
   2. (ii) at his place of work or at a place which is more convenient for him;
   or be supplied with, a voting paper; and
2. (b) be given—
1. (i) a convenient opportunity to vote by post (but no other opportunity to vote);
2. (ii) an opportunity to vote immediately before, immediately after, or during, his working hours and at his place of work or at a place which is more convenient for him (but no other opportunity); or
3. (iii) as alternatives, both of those opportunities (but no other opportunity).").

The noble Earl said: My Lords, this is another drafting amendment. I beg to move.

On Question, amendment agreed to.

Clause 14 [Political objects]:

The Earl of Gowrie moved Amendment No. 32: Page 20, line 4, leave out ("or").

The noble Earl said: My Lords, with the leave of the House, I should like to speak to Amendments Nos. 32, 33, 34, 35 and 38 together. Why should this not be acceptable?

Amendment No. 33: Page 20, line 5, after ("candidate") insert ("or the holding of any ballot by the union in connection with any election to a political office").

Amendment No. 34: Page 20, line 10, leave out ("at which business of a political party is transacted") and insert ("the main purpose of which is the transaction of business in connection with a political party").

Amendment No. 35: Page 20, line 14, leave out from ("advertisement") to ("not") in line 17 and insert ("the main purpose of which is to persuade people to vote for a political party or candidate or to persuade them").

Amendment No. 38: Clause 16, page 22, line 38, after ("ballot") insert ("other than the reference in section 14(1))").

Lord Wedderburn of Charlton

My Lords, will the noble Earl give way?

The Earl of Gowrie

Yes, My Lords.

Lord Wedderburn of Charlton

My Lords, my noble friends and I had understood that Amendments Nos. 34 and 35 were to be taken separately. They involve a Government concession, which naturally we rejoice in. The other amendments are amendments that we would wish to oppose.

The Earl of Gowrie

My Lords, my understanding was that I would speak to Amendments Nos. 32, 33, 34 and 35 together, together with Amendment No. 38, which is purely consequential to Nos. 32 and 33. All these amendments are concerned with the revised definition of political objects in Clause 14. May I not speak to them and then noble Lords can pick and choose which of my remarks they wish to oppose? I am sure that they will find something if they look hard enough. Amendments Nos. 34 and 35 have been tabled in response to concerns expressed by noble Lords opposite during the Committee stage—in fact, I do not think that they will able to find anything, however hard they try!

Amendment No. 34 relates to paragraph (e) of the new definition which deals with political meetings and conferences. During the Committee stage, the noble Lord, Lord Dean of Beswick, argued that the present formulation would catch union expenditure on meetings where any of the items on the agenda, however inconsequential, were the business of a political party. The noble Lord accepted that the costs of a meeting called with the main purpose, for example, of promoting or supporting a candidate for a senior position in the Labour Party should come from the political fund: but he was concerned that a branch meeting which is mainly concerned with ordinary union business might also have to be financed from the political fund just because one of the subjects discussed was an issue such as, to use the noble Lord's example, the question of who should be nominated to fill a vacant position in a constituency Labour Party.

We have looked at this paragraph again, as my noble friend Lord Gray of Contin agreed to do, and Amendment No. 34 is designed to make clear that only meetings which are held primarily to transact party political business need be paid for from political funds. In re-examining the paragraph, however, we realised that the phrase "business of a political party" could be unduly restrictive since it might be held not to cover meetings held to decide such questions as which union members should be included on panels of parliamentary candidates, how to cast union votes at a party conference and so on. This is why the revised formulation refers to meetings: the main purpose of which is the transaction of business in connection with a political party". Amendment No. 35 deals with a concern expressed by noble Lords opposite relating to paragraph (f) of the new definition, which covers the various different forms of political communications. The noble Lord, Lord Underhill, suggested that paragraph (f) as presently formulated might be held to cover communications aimed against particular aspects of Government policy as part of an industrial campaign by a union, because—to quote the noble Lord: It could be held that this activity is endeavouring to persuade persons not to support the Government but to support another political party".—[Official Report, 25/6/84; col. 771.] It is not, as Government spokesmen have made clear on a number of occasions, our intention to place new restrictions on trade unions' ability to conduct political—as opposed to party political—campaigns. There is a dividing line to be drawn, and the present formulation, taken as a whole … seeks to persuade was intended to reflect the line currently contained in the 1913 Act definition. Although not spelt out explicitly, it already carries—in our opinion—a test of predominant purpose. On one view, therefore, we would have been right to say to noble Lords opposite that we had considered their concerns and concluded that they were unfounded. However, whatever else may be the case, the debates on paragraph (f) in this House and in another place have shown that its present formulation can lead to considerable confusion and offer scope for widely differing interpretations. We entirely concur with a view expressed by the noble Lord, Lord Underhill, during Committee stage that the position ought to be as clear as possible. We have therefore tabled Amendment No. 35 with a view to greater clarity. I hope noble Lords opposite will welcome the amendment in the spirit in which it is offered.

The trouble sometimes with looking again at things is that other matters then may catch the eye. Amendments Nos. 32, 33 and 38 are the product of this process. It has always been our intention that expenditure incurred in holding ballots within trade unions to decide how the union's block vote should be cast in, let us say Labour Party leadership elections, should be reflected in the revised definition. I am sure that even noble Lords opposite would accept that such expenditure is clearly party political and should be made from political funds. We had taken the view that expenditure of this sort was covered in the phrase "in connection with the … candidature", but on re-examination we were not so sure. So Amendments Nos. 32, 33 and 38 are simply designed to make matters clear and certain. I hope that what I have had to say will have convinced your Lordships that this series of amendments will make desirable improvements to the revised political objects definition, and that they will receive the support of the House. I beg to move.

Lord Wedderburn of Charlton

My Lords, I was under a misapprehension. We had thought that amendments Nos 32, 33 and 38 were to be taken separately, and I addressed my remarks to them. My noble friend Lord Dean, who is perhaps better at rejoicing than I am, will deal with the happier amendments, Nos. 34 and 35, although I am sorry to be deprived of an opportunity, not least tonight, to rejoice.

The noble Earl is right that the Bill will be read many times because it is so difficult to understand, and, therefore, we read this amendment very carefully. The noble Earl has repeated the Government's own self-imposed guideline—which, indeed, they failed to keep (which is the reason for making changes in Amendments Nos. 34 and 35, with which we shall deal)—not to extend controls on trade unions' political funds beyond the 1913 territory. It would be our contention that the new amendment in fact transgresses that principle, which has been put forward many times by the noble Earl's right honourable and honourable friends in another place, by the noble Viscount, Lord Long, on 25th June at col. 767 of Hansard, and now by the noble Earl himself tonight.

The reason for that is as follows. The noble Earl says that this involves expenditure in relation to block votes. Yet the amendment is concerned with any expenditure on: the holding of any ballot by the union in connection with any election to a political office". Of course, we know by now that "political office" includes an office within a party, and we have said before that we think that that generalisation goes beyond the 1913 Act in certain ways.

However, there are two ways of putting the question. First, the noble Earl said that they thought that the sort of things they had in mind were not already covered by expenditure which the Bill already covers: namely, expenditure: in connection with … the candidature of any person", the word "candidature" of course, having the extended meaning which goes with the definitions of "candidate" and "political office". He did not quite explain why; it was as though they were just tidying up a loose end. He mentioned block votes, but obviously they are block votes: in connection with any election to a political office". The other way of putting the point is concerned with the words "in connection with". Indeed, the Government have had trouble with the words "in connection with" before: if I am not wrong, they had to take them out of another paragraph at a previous stage. What other kind of ballot can there be "in connection with"—other than the one which the Bill already covers in connection with candidature?

The phrase "in connection with" is a very wide phrase indeed; it is not "related to". Indeed, the noble Earl will remember the changes in trade dispute definition which the Government themselves made in 1982, which specifically took out the words "in connection with", which they said was too wide a formula, and inserted matters which were related "wholly or mainly to" certain issues.

Perhaps I may take the example of candidates in a local Labour Party. Indeed, let us remember that here it may not be a local Labour Party. Let us take something which could be tested without anyone in this House having a direct interest. Let there be a candidate for office within the Ecology Party. Let us assume that the union knows that many of its members are interested; that it has discussed the matter with those persons; but that there is an issue as to whether a nuclear power station should be sited in the area.

Let us suppose that the union, which organises many workers in this field, takes a decision on policy (for the purposes of the argument it does not matter whether the decision is for or against) relating to industrial matters, to social matters—to the totality of the issue. If it has persons who are going along, either by themselves or it could be as delegates—it might be that they have some association with this local organisation—who will take sides on the election of a person to office within the party, that would be covered by the clause. Yet the union has decided a matter of policy which is surely within the same logic as the amendment at which my noble friend Lord Dean is about to rejoice—namely, that the main purpose for the union in its deliberations is an industrial purpose. It would have taken this decision whether or not there had been any such party, because it had to resolve union policy on the matter at whatever level, be it regional or local.

This paragraph lacks the main purpose test. It is another example of the Government going too far without the main purpose test. But examples of that sort, given the wide meaning of the words "in connection with", surely go beyond what the noble Earl wishes to reach. If he is saying that he is not sure that the present Bill would catch a block vote decision, and a ballot behind a block vote decision, on, say, the treasurership or leadership of the Labour Party, I am not sure why the present Bill does not do that, but if the Government wish to firm that up then suitable words could be found. These are not those words. They go more widely, and on our Benches we would ask the Government to reconsider this amendment carefully.

10.41 p.m.

Lord Dean of Beswick

My Lords, I am grateful to my noble friend Lord Wedderburn for the way he has spoken to these amendments and the way he introduced the two with which I shall be briefly dealing. Earlier in the proceedings today the noble Lord, Lord Houghton, made the comment that there was a lack of grass-root trade union opinion and views in this House. For my sins, perhaps I can claim still to be the nearest to that point of view and to bring in that knowledge, having been a shop steward until I became a Member of another place just ten years ago.

I am grateful to the Minister, because I got the impression on the night that I was speaking to these amendments that I was being listened to sympathetically by the noble Earl and the noble Lord, Lord Gray of Contin, who dealt with them in Committee. I certainly do not ascribe the success of the Government bringing forward these proposals to any powers of eloquence of mine, when I realise the overwhelming points in the Bill which have been dealt with more than adequately by my two noble friends Lord McCarthy and Lord Wedderburn.

In some respects it was almost a case of my being given the short straw of the one which probably had a chance of being successful. I was able to show that the main functions of trade unions when they meet are not to discuss political items. Often the item that becomes political is not on the agenda when they start the meeting. Most branch meetings of trade unions commence with the minutes of the last meeting, matters arising, and correspondence. Most of the political matters that trade unions deal with at branch meetings come out of correspondence. Often it is a political item which is dealt with in a couple of minutes. It arises from the correspondence, and sometimes there is not that much debate about it. That is why I referred to the question of nominations for such things as municipal panels for local authority elections, and parliamentary panels which take place once after each general election.

I was beginning to lose hope that the Government would move in any direction towards giving the trade union movement a sympathetic hearing. I was disappointed last week when I moved an amendment on the Health and Social Security Bill designed to retain for trade unions their historic right of nominating people to the various appeal tribunals and panels. Even that amendment fell on deaf ears. However, I am grateful to the Minister for these. I think they will be well received. They are probably far more important amendments on the fundamentals of trade unions and their political rights and the way they run their business. On this occasion the Government have listened sympathetically. On behalf of my noble friends and myself and the movement as a whole, I welcome the amendments in the spirit in which they have been moved, and I express my appreciation to the noble Earl.

Lord Houghton of Sowerby

My Lords, may I make a comment? One of the beauties of English law is the number of people who immediately devise ways and means of getting round it. Any trade union leader of any experience could write a correspondence course on how to evade the conditions of the Trade Union Act 1913 and they will be doing the same here.

I remember calling a meeting of my own executive committee in 1945 for a reasonable amount of normal business, but we said "When the meeting is concluded we will all stay behind, if you please, because one of our assistant general secretaries (who was just coming back from the Navy) thinks he would like to stand as a parliamentary candidate at the general election". So we concluded our official union business and then we all gathered together to see how we could promote the candidature of Mr. James Callaghan. That is how a Prime Minister was made. We all put our heads together about how to raise the money and what circularisation we would do for more money and so on. No trouble at all; no problem, and there will not be any problem with many of the activities that are intertwined with union work. One can always bring a union meeting to an end.

Then there is another device which at public meetings I used to find others indulging in greatly: saying to the meeting, "I am not allowed to tell you to vote Labour at the general election, so I cannot tell you to do that". This kind of evasion goes on, but nobody takes any notice of that. If it were all about voting Labour, or for any other party, it would be caught. But there is enough genius for evasion around in the land today for laws of this kind to offer very few difficulties for those who want to get round them.

There are some things that would have to be faced, such as the financing of candidatures. The basic things in the 1913 Act are there and I think they are, in the main, sufficiently specific to keep irregularities in check. As for the rest, I think it will all come out in the wash.

The Earl of Gowrie

My Lords, the noble Lord, Lord Wedderburn, criticised me and the noble Lord, Lord Dean of Beswick, was grateful to me. This is the classic softening-up technique of the tough cop who makes way for the nice one who praises you and will offer tea and a cigarette. I suppose that I am very easily disarmed. On the points raised by the noble Lord, Lord Wedderburn, it was simply because of the uncertainty of the phrase "in connection with the … candidature" that the Government felt that it was necessary to spell out that the balance on how to cast union votes at elections to political office was covered. The aim was simply to make matters clearer and perhaps to avoid the difficulty that that admirable assistant secretary once found himself in.

When the noble Lord, Lord Houghton, was talking I was reminded of the only recently-ended advertising campaign that we have seen round the streets along the lines that, "I am not allowed to tell you about Winston cigarettes so here is a picture of a tart leaning against a bar". Your Lordships will remember that that is how they tried to get round the situation.

The Government accept that expenditure on balance to determine how to cast a union's block vote in general elections is not covered by the 1913 Act, but it could not reasonably be claimed that the omission was anything but anomalous. What could be more party political than that? What possible justification could there be for using general funds for this perfectly respectable purpose? As I said during the Committee stage, the Lord Chancellor in 1913 readily accepted that the definition might not catch everything that ought to be caught. It is hardly surprising that this aspect was overlooked, but it is an aspect that could involve significant amounts of expenditure and we believe that it would be wrong for us to overlook it now.

I am grateful for the words of the noble Lord, Lord Dean of Beswick, and I shall relate them to my own soft cop in the more accommodating person of the noble Lord, Lord Gray of Contin. I hope that the noble Lord, Lord Wedderburn, will not press his amendments.

On Question, amendment agreed to.

The Earl of Gowrie moved Amendment No. 33:

[Printed earlier: col. 1446.]

On Question, amendment agreed to.

The Earl of Gowrie moved Amendments Nos. 34 and 35:

[Printed earlier: col. 1446.]

The noble Earl said: My Lords, I have spoken to these amendments, as to Amendments Nos. 32 and 33. With the leave of the House, I would move Amendments Nos. 34 and 35 en bloc.

On Question, amendments agreed to.

Clause 15 [Collection of union dues by employers]:

Lord Rochester moved Amendments Nos. 36: Page 21, leave out lines 19 to 22 and insert ("wishes to contribute to that fund, then (and not otherwise)").

The noble Lord said: My Lords, I should like to deal with the next two amendments together, if I may. Amendment No. 37: Page 21, line 24, leave out ("no") and insert ("the appropriate"). They relate to the so-called check-off system under which employers collect trade union subscriptions from the pay of their employees on the union's behalf. Under this system, even where a union member has contracted out of the political levy, he is unable to require his employer to stop deducting the levy from his pay. By inserting Clause 15 into the Bill at the Committee stage, the Government have now ensured that when a trade union member certifies in writing to his employer that he is exempt from the obligation to pay the levy or has notified his union that he objects to paying it, the employer may not deduct the relevant amount from the individual's pay.

My noble friends and I have already made it plain that we are opposed to the contracting-out system but, following earlier discussions on Amendment No. 29, we now have to recognise that we are stuck with it, at least for the time being. We see no reason, however, why that system should extend to the arrangements under which an employer deducts the political levy from an employee's pay.

As a matter of principle, surely, such deductions should be made only if, as the case of other deductions, the individual has indicated positively to his employer that that is his wish. As far as this amendment is concerned, there can be no agreement—or, at least, I take it that there has been no agreement—between the Government and the TUC; and, so far as I know, the matter did not feature in the Conservative Party manifesto at the last election. I trust, therefore, that on this occasion, by accepting these amendments, the Government will ensure that the more positive approach to this matter suggested in the amendments is adopted for the future. I beg to move.

Lord McCarthy

My Lords, I have only two points to raise as a result of what the noble Lord has said. First, this is covered by the understanding which the Government has with the TUC because the understanding with the TUC is that the Government will not change the present contracting-out arrangements. It was on that basis that we complained about the Government's amendment which has now been passed and which says that an employer can cancel the check-off on the initiative of the individual worker. This whole question of dealing with the contracting out and contracting in position was covered by the agreement.

Secondly, I do not see any particular reason why we should make a specific reduction in the trade union levy in the case of there being a check-off. If there is a check-off, it has to be consented to. It cannot be introduced without the agreement of the worker. The worker has to agree to the check-off, and if he does not want to agree to it, there is no check-off. At the same time, he can or need not agree that he wants the subscription deducted in respect of political funds. It is not a question of making a distinction between one way of collecting the contribution and another, and it was covered by the agreement with the TUC.

The Earl of Gowrie

My Lords, these amendments would have been the natural corollary to Amendment No. 29, which we debated earlier. Had it been decided to change the political levy from contracting out to contracting in, it would have been entirely logical to consider what adjustments were needed in the provision dealing with the collection of the levy by means of the employer check-off. In the absence of such a change, the amendments take on a different character. They would, as the noble Lord, Lord McCarthy, has implied, have the effect of introducing contracting in by the back door, so to speak for the majority of trade union members—probably about 70 per cent.—who pay their union subscriptions through the check-off.

I hope therefore that since we have gone over this ground and have taken it to a Division today, the noble Lord will not press the amendment, which would in a sense provide a back door solution to what he was unable to obtain by the front door. That said, the general aims of the noble Lord and his party are sympathetic to the Government. I repeat what I said, that we shall be examining the unions' commitment very carefully and we will legislate along the lines that the noble Lord would like if in this respect they step out of line.

Lord Rochester

My Lords, I am disappointed with the reply of the noble Earl. As my noble Leader, Lady Seear—I do not think that I have had occasion to call her that before in the House—said in the case of the debate on contracting in, the Liberal and Social Democrat Alliance cannot be held responsible for the agreement which, it seems, the Government have reached with the TUC covering this matter as well as the matter of contracting in. However, at this time of night, I see no point in taking the matter further, and therefore with great reluctance, on what we see as a matter of principle, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 37 not moved.]

Clause 16 [Interpretation]:

The Earl of Gowrie moved Amendment No. 38: Page 22, line 38, after ("ballot") insert (" (other than the reference in section 14(1))")

The noble Earl said: My Lords, this amendment is consequential. I beg to move.

On Question, amendment agreed to.

The Earl of Gowrie moved Amendment No. 39: Before Clause 17, insert the following new clause:

("Amendment of ss. 1 and 2 of Employment Act 1980. 1980 c. 42.

.—(1) Section 1 of the Employment Act 1980 (payments in respect of secret ballots) shall have effect as amended by subsections (2) to (4) below.

(2) In subsection (3) (ballots to which the section applies)—

1. (a) in paragraph (b) (election provided for by union's rules) at the end there shall be inserted the words "or in relation to which section 2 of the Trade Union Act 1984 is required to be satisfied"; and
2. (b) after paragraph (e) there shall be inserted—

f) obtaining a decision on a resolution for the purposes of section 3 of the Trade Union Act 1913".

(3) After subsection (3) there shall be inserted the following subsection—

"(3A) Notwithstanding anything in subsections (2) and (3) above, this section does not apply to any ballot held by a trade union, if—

1. (a) the purpose of any question to be voted upon is the obtaining of a decision of the kind mentioned in paragraph (f) of subsection (3); and
2. (b) the ballot is held at a time when there is no resolution in force in respect of that union under section 3 of the Act of 1913."

(4) In subsection (5) (ballots to be conducted so as to secure that those voting may do so in secret) the word "may", where it last occurs, shall be omitted.

(5) In section 2(2)(b) of the Act of 1980 (ballots to which section 2 applies to be conducted so as to secure that those voting may do so in secret), the word "may" shall be omitted.").

The noble Earl said: My Lords, I hope that I can speak to this amendment very briefly. As your Lordships will be aware, Section 1 of the Employment Act 1980 and subsequent regulations established the funding of a ballots scheme under which certain postal ballots held by trade unions qualified for public funding. The new clause ensures that all ballots required under the various parts of the Bill, to the extent that they would not otherwise have qualified, will similarly qualify for funding so long as they are carried out by post. I am sure your Lordships will agree that it is entirely right to provide further encouragement towards postal balloting. I beg to move.

Lord McCarthy

My Lords, there is a sense in which one welcomes this amendment. It is the sense that, since the Government are imposing upon trade unions the necessity to have periodic ballots in the case of political levies, and since they are imposing upon them a preference whereby they are going to end up, as a result of the provisions of the Bill, probably, having postal ballots—and, indeed, most ballots for political funds are carried out by postal ballots—one ought, I suppose, to be pleased that the Government are making the money available, and in that sense I welcome the amendment. But the fact is that there is something strange about this amendment—something, one might almost say, curiously mean about this amendment.

The money is being given, yes, if a trade union is to have a ballot to maintain its political fund, but not if a trade union is to have a ballot to establish its political fund, because the consequences of subsection (3)(b) are that that will not be allowed. Subsection (3)(b) says that if, the ballot is held at a time when there is no resolution in force in respect of that union under section 3 of the Act of 1913", then there can be no application for money. Within the logic of the scheme, I want to ask the noble Earl: what is the justification for making this exclusion? Why is it that if the Transport and General Workers' Union (which has been affiliated to the Labour Party since its establishment) has to run a ballot—as, indeed, it has to run a ballot next year—it can, if it wishes, go and get money if it can satisfy the certification officer under the terms of the 1980 Act; but if NALGO, which recently had a ballot for the establishment of a political levy, which it lost, wished to have another ballot next year or the year after in order to see whether it could establish the decision for a political levy, even if it did it by postal ballot, it could not have the money? What is the logic of it?

Take the case of a union like the ASTMS. It is generally said that that is one union which is going to find it extraordinarily difficult to cover the very large number of members who contract out—something like 90 per cent. of the union. If the ASTMS finds it extraordinarily difficult to get a ballot in favour of a political levy the first time round, it can ask for money and, because it has a levy now, it can get the money; but if it loses, the next time it comes back it cannot get the money. What is the logic? What is the sense? Why be so mean when, for once, you are being rather logical? Why on earth say that if you have not get the resolution you cannot apply for money under the 1980 Act?

The Earl of Gowrie

I think the answer is a simple one, and it is not a question of being a trade-off between logic and generosity. The ballots in this Bill are a new statutory requirement, and, as my honourable friend the Parliamentary Under-Secretary, Mr. Clark, said in Standing Committee in another place: We would be making provisions for public funding for a review of ballots, this being entirely reasonable because they are a new statutory requirement". There is, of course, no limitation on the number and frequency of ballots which unions may hold in the hope—perhaps the vain hope—of setting up a political fund. It was never the Government's intention to offer a blank cheque for this purpose, and it would seem to me to be an abuse of taxpayers' money if we were to do so.

Lord McCarthy

My Lords, before the noble Earl sits down, would he not agree, then, that if that was the intention of the Government the best way they could have done it would have been to introduce some qualification to say that you can get the money only once every five years or once every three years, but not to say that you cannot get the money at all?

The Earl of Gowrie

My Lords, I do not see that that would do anything other than establish the principle on a more limited basis than the noble Lord would like, but which I would say is unjustified. As I argued in my original statement, we are trying to deal with a new statutory requirement here, we are trying to meet the costs of it, we are trying to encourage a move towards personal ballots and all are covered by the provision of funds. But to give the kind of open-ended commitment for all kinds of political activity on central taxpayers' money would seem to me to be misplaced.

On Question, amendment agreed to.

Clause 18 [Short title, commencement and extent]:

11.6 p.m.

Lord McCarthy moved Amendment No. 40: Page 23, line 11, leave out ("two months") and insert ("one year").

The noble Lord said: My Lords, we return now to the question of when Part II of the Bill is to come into effect. The House will, I hope, remember that we had an amendment at the Committee stage in which we tried to extend the period of Part II of the Bill, because we said that the Government had, reasonably enough, accepted that there should be delay in the introduction of Part I and that conditions to make effective Part I of the Bill applied equally—indeed, to more effect—to Part II of the Bill.

In other words, it will be more difficult, I would argue, for trade unions to come into conformity with Part II of the Bill dealing with strike ballots, than for them to come into conformity with Part I of the Bill dealing with elections. We said that we would return to this on Report, partly because it seemed possible to me that the Government were unduly constricted by the brief which they had, since it appeared from the reply we had from the noble Earl in Committee, that the Government accepted to some extent the position that we were putting forward, because the noble Earl said at col. 873 of the Official Report for 26th June: the Government recognise that it would be unrealistic to expect unions to make changes overnight. That, in a nutshell, is why, subject to any further considerations which may be occasioned by our response to the amendment of my noble friend Lord Beloff, it is our intention to introduce Part I"— not Part II— by a commencement order, so that it takes effect a little over a year after Royal Assent. That is where we get our 12 months from in the amendment before the House. The noble Earl went on: That will provide the necessary time for unions to bring their arrangements into line with what Part I of the Bill requires. So in terms of Part I of the Bill, in terms of the problems of unions changing their rule books, he met the point and accepted the point. Yet he went on to say, I do not see, however, that these concerns apply in any real sense to Part II of the Bill, because Part II faces trade unions with what is essentially a very simple proposition. If they intend to organise industrial action and wish to avoid liability under the civil law for doing so, they will need to hold a proper ballot first. The practical implications of holding a ballot will vary considerably, according to the scale and other circumstances of the industrial action which they may be contemplating.

We sought to argue—and, maybe, we did not argue it properly—that, in fact, a union cannot carry out this essentially simple proposition of organising industrial action under the terms of this Bill, unless it has rules to govern what it does; that all unions have some rules in their rule books to govern industrial action and that those rules will have to be changed, so that members of the union who may not be aware of the detailed provisions of this Bill—there are such people—going about their daily business, reading their rule book and doing what they know they must do because it is in the rule book, will, by that very process, be carrying out the law. That, presumably, is the argument that underlies the acceptance by the noble Earl of the fact that he needs 12 months to carry out Part I of the Bill. We are saying that if rules need to be changed to carry out Part II of the Bill (and rules do need to be changed) then one needs to have 12 months to do that.

As I said on that occasion, and as the Undy and Martin study showed, trade union rule books will need more radical revision if they are to conform with Part II of the Bill. Trade unions must compile accurate registers, and the Bill has placed some new impositions on the unions today in respect of compiling a register. But the register which the unions will have to compile in relation to strikes will be much more complex.

Very often it will have to be a multi-union register because there will be a multi-union collective bargaining unit. A bargaining unit is constantly changing. The membership of the bargaining unit is constantly changing. One union as large, for example, as the Transport and General Workers' Union may have hundreds and hundreds of different bargaining units which will straddle branches, regions, trade groups, and so on. The Government have placed an imposition upon the unions, although at this moment we are not cavilling at that. They have placed the imposition on the unions that if they are to have a lawful, official strike then they must hold a ballot under the provisions of this Bill.

We say that that will take a little time. In answering this point at an earlier stage of the Bill, the noble Earl made the most remarkable comment, and I wonder whether he actually got it from the brief. The noble Earl seemed to be saying that the way out for trade unions was to fragment the bargaining structure. He said at one stage, although he did not use these words, "Well, it will be all right where the bargaining unit is on a small scale". He said: Where this is on a small scale, there should be no difficulty in setting up the necessary arrangements in a short space of time".—[Official Report, 26/6/84; col. 873.] I agree that that might be so if the bargaining unit is small enough; if it consists of only five members of a union—five dinner ladies, as it might be—then it would be quite easy to bring them into a postal ballot. But suppose one is bargaining with all the dockers, or all the miners, or all the engineers employed by British Leyland; they may be in membership of seven different unions. Or suppose one is bargaining with construction workers all over the country in four different unions. Are the Government seriously saying that implied in their Bill is a desire to fragment bargaining structures; to make it impossible for unions to run national strikes because they will not be able to ballot on national bargaining as a result of the Government introducing the Bill in two or three months?

What the noble Earl said on that occasion, I suggest with great respect, was either something of a daft answer which he did not really mean, or we must see it as a further attempt to make matters difficult for trade union leaders; to make official, large-scale national industrial action difficult if not impossible. If that really is the intention of the Government they ought to say so; if not, they should accept this amendment. I beg to move.

The Earl of Gowrie

My Lords, I dealt during the debate on Amendments Nos. 17 and 18 with the suggestion by the noble Lord, Lord McCarthy, that trade unions will have practical difficulties in complying with Part II of the Bill within two months of Royal Assent. I believe that the House was convinced by what I said earlier; that the balloting provisions could be complied with, if trade unions so chose, without inordinate difficulty.

What other arguments does the noble Lord have for deferring the commencement date? He has raised again the fact that the commencement of Part II will be sooner than for Part I of the Bill. But there were good reasons for allowing a longer timescale for commencement of the provisions on elections. In most of our major unions the existing electoral systems fall far short of the basic principles which Part I of this Bill establishes and, while there can be no reasoned objection to the requirements which Part I lays down, the Government do of course accept that for many unions major changes will need to be made to their existing systems. So it would be unrealistic to expect the unions to make such changes overnight.

The noble Lord, Lord McCarthy, made much during the Committee stage of the suggestion that trade unions would need time to enable changes to be made to their rule books. This, indeed, was repeated by the noble Lord, Lord Wedderburn, earlier this evening. That argument would only wash, surely if trade unions' rules relating to strikes were substantially incompatible with what is in the Bill—as some are in relation to elections. But this is simply not the case. That being so, I do not quite understand the use that the noble Lord was making in this context of something I did or did not say at an earlier stage. As a matter of courtesy, I will simply undertake to reexamine what I said.

Less than 25 per cent. of the trade unions examined by Messrs. Undy and Martin, whom the noble Lord quoted, have any form of mandatory requirement for ballots before strikes. Where trade unions' rules do require ballots, or alternatively give their executives discretion to hold them, I am not aware of any which are incompatible with what is in the Bill. And to the extent that their rules require the actual strike decision to be taken by one body or another, as many in fact do, there is nothing in the Bill to change that position. The Bill says nothing about who must take the decision to authorise a strike call: it simply tells those who make that decision what conditions must be satisfied if the trade unions are to comply with the Bill. Trade unions will certainly need to take steps to ensure that the necessary practical arrangements are made, as we discussed earlier. But I would be very surprised indeed if any of their rule books actually prohibited them from doing what is necessary, or if they failed to invest their executive bodies with sufficient authority to take such steps.

In any case, the crux of the matter here is—just as I said in reply to the noble Lord, Lord McCarthy, during Committee stage—that no one is telling trade unions that they must organise strikes. The position is quite different from that relating to elections, which of course they are required to hold under their rule books. As I concluded before, if trade unions cannot—in the modern parlance—"get their act together" in time, then they must simply not call the strike until they have done so. If they choose to go ahead with the strike and deprive themselves of their immunity, that is entirely a matter for them—though it is of course also a matter for which they will be answerable to their members if the funds of the union suffer as a result. I hope that what I have said will have convinced your Lordships that there are no grounds in this particular context for enabling trade unions to act less promptly than other organisations which have to respond—as we all do—to legislation. I hope, therefore, that the noble Lord will agree to withdraw his amendment.

Lord McCarthy

Before the noble Earl sits down, would he not admit, since he has quoted Undy and Martin, that what Undy and Martin show is that you can divide trade union rule books into three groups? There are those which allow, in effect, the executive to decide when there will be a strike; there are those which allow certain delegate conferences to do it; and there are those which consult the members, often by ballot. But, under the provisions of this Bill, everybody has to do it by ballot; everybody, indeed, has to have a mandatory ballot. In order to have a mandatory ballot, Undy and Martin say that in something like 80 per cent. of unions—if not more—you would have to change the rules. This is the argument! Does not the noble Lord the Minister accept the argument?

The Earl of Gowrie

My Lords, I see the logic of what the noble Lord is saying, but I do not think he is admitting the logic of what I have been saying. Here are a number of unions which have ballots. Where trade union rules require ballots or give a discretion for them to be held, surely there is no situation in Undy and Martin or elsewhere which is incompatible with the provisions of the Bill. We are simply drawing the provisions of the Bill sufficiently widely to require ballots.

On Question, amendment negatived.

The Deputy Speaker (Lord Airedale)

My Lords, in calling Amendment No. 41 I have to point out that, if this were agreed to, I would not be able to call Amendment No. 42.

Clause 18 [Short title, commencement and extent]:

Lord Wedderburn of Charlton moved Amendment No. 41:

Page 23, line 12, leave out from ("shall") to end of line and insert ("not come into force until such day as the Secretary of State may by order made by statutory instrument appoint; but the Secretary of State shall not appoint a day for that purpose until:

1. (a) the publication of a report by a committee which shall be appointed by him within one month of the passing of this Act, consisting of such persons as he may select, for the purpose of inquiring into the law and practice of expenditure on political objects (within the meaning of the 1913 Act) by trade unions, companies and other bodies and associations; or
2. (b) the expiry of a period of two years beginning with the day on which this Act is passed,

whichever is the earlier.")

The noble Lord said: My Lords, we are coming near to the end of a hard Report stage. It occurred to me that the noble Earl has, I think I am right in saying, dealt unaided with this Report stage. I was about to remark that the Government have, like Pharaoh, made our lives bitter with hard bondage; but that would be unfair because his service, too, has been hard service in the field. However, it is perhaps time for his heart, therefore, to mellow and look with favour upon a very modest proposal.

In Committee we advanced an argument on what might be called the broad issue; that is, the issue of political funds viewed as a social phenomenon is not one that involves trade unions alone. Indeed, it is only in this country that it is seen in the way that it is, as involving trade unions alone—I mean, of course, in regard to regulation and not disclosure, which is quite a different issue. It is because of the Osborne case, as we all know when we reflect quietly at home, and without that case it would have been dealt with very differently. That decision of 1910 has given us a most unhappy bequest.

The amendment asks that the part of the Bill that deals with political objects in very new ways—as we see it, imposing very severe restrictions on trade union rights to engage in political activity and discussion—should not come into force until either a period of two years has run, which would perhaps take the noble Earl and the Government to the point where they were still in office so long as the economy remained in good shape, or until the publication, if before that date, of a report upon what I call the broad issue.

The broad issue, I apprehend, is really agreed between ourselves and noble Lords on the Liberal Benches in the sense that their amendment shows that they, too, see the issue as a very serious question relating to how political parties should be financed. Alternatively, if one wants to go a little more narrowly than that for immediate issues, there is the question of, first, what are the facts?—who is giving what to political parties should be brought into the light of day more clearly than it is—and secondly, what is the law about it and how should we deal with this very difficult matter?

The noble Lord, Lord Houghton, engaged in a much more wide-ranging discussion and gave his views in Committee but I apprehend that he, too, agrees that there is this broad issue. I say to noble Lords with whom we disagree on one or two points that on this matter it seems to me that there is not much point in discussing whether we are talking about contracting in or contracting out. We shall disagree on that, no doubt. But that there is a broad issue relating to financing of political parties by trade unions, companies, insurance companies, banks, cooperatives, or whatever they may be, is surely common ground.

On many occasions the Government have answered that point by saying that companies are not like trade unions. Of course, one can say that companies are not like co-operatives and that banks are not like insurance companies, and there is a sense in which that is true. But it will not do to sweep the broad issue under the carpet by saying that a shareholder can sell his shares. One might answer by asking why should an investor be so constrained when it is not in the law that he should be? Indeed, it not only affects the shareholder but also affects consumers and employees, in respect of whom duties are now owed by directors.

In Committee on 25th June the noble Earl, at column 761 of Hansard, suggested of companies, They do not have powers in the same way over the lives of ordinary people", as trade unions do. I say that that surely is unacceptable in the purpose of this broad issue. Companies have vast powers over the lives of ordinary people.

The noble Earl also said that the tendency to concentration was covered by anti-trust and antimonopoly legislation. That is something with which my noble friends and I would probably disagree in terms of its efficacy; but let the issue be considered in that context in the highest concentrated economy of Western Europe. Millions of pounds are given to the Conservative Party, and very large sums are given to other organisations, which will undoubtedly now fall within the new definition of political objects in this Bill, as it amends the 1913 measure.

For example, the documents of Aims of Industry state that it is campaigning for free enterprise against nationalisation, and that it has the support of 1,000 companies and associations which in turn represent 30,000 companies. It is also stated in its literature that it advises companies that donations to Aims of Industry are not political donations. The Economic League stands in very much the same place. As for British United Industrialists, since it deregistered as a company in 1967, information about that organisation is shrouded in mystery.

Of course there is a party interest in this matter. I say from a party point of view that we have a right to know more about some of these donations. But I also say from a much broader point of view that it cannot be right to allow this festering sore of the Osborne judgment—because that is what it is—to go on as the basis of the discussion for all time.

Therefore, the Government, even at this very late stage, might show a great deal of social wisdom if they said: "Very well. We believe that our Bill is right. It must come into force at a date which normally would be before the next general election, but we agree that it will be postponed"—after all, the amount going to the Labour Party, or indeed to any other party, in the period will not be all that great; on the evidence that we have, the amount going to the Conservative Party would probably be greater—"and there will be this inquiry. We will set up a small body of broad character, which will ask for evidence quickly, will establish some facts, will show what the law is, what its development is and how our proposals fit into that".

The Government have re-opened the settlement of 1913, and I stress that. No doubt the Act of 1913 has defects. Noble Lords on the Liberal Benches will say that one of its defects is contracting in and contracting out. But to re-open the social compact at a time when consensus in our society is—heaven knows!—fragmented enough is a very serious step to take. Therefore, as an act of wisdom in the late evening of the Report stage, as the Minister draws near to the end of it, we have some hope that the noble Earl, although of course he cannot at this stage accept the amendment, will at any rate agree to consider with his right honourable and honourable friends the issue which the amendment places before the Government. I beg to move.

11.28 p.m.

Lord Rochester

My Lords, my noble friend Lord Aylestone has already spoken to the principle underlying this amendment in moving Amendment No. 29. In our view there needs to be a much more even-handed approach as between contributions made by individuals to trade unions and those made by companies to a political party. We know very well that there are differences between the two cases, particularly in the scale of funding and in the degree of regulation of companies that already exist. It is simply that we consider that there is an urgent need to find ways to finance political parties that are different from and fairer than those that now exist.

Once again noble Lords on the Labour Benches have contrived at a late stage to have their amendment placed on the Marshalled List just before one that we had tabled earlier. But since, on this occasion, unlike the last, there is no great difference of principle involved between us, and since at this late stage of Report my noble friend and I feel nothing but warmth towards the noble Lords on the Labour Front Bench, and indeed to the noble Earl, who has borne the heat and burden of the day for the Government, we are very ready to give our support to this amendment.

The Earl of Gowrie

My Lords, the noble Lord, Lord Wedderburn, said in his usual beguiling way that he was bringing forward at the end of the evening a modest proposal. Unfortunately for him, I am an Irishman, and I am an admirer of that great high Tory writer, albeit one beloved by Michael Foot, Jonathan Swift. So I know enough to be suspicious of modest proposals. They may urge one to eat one's young, and I do not propose to eat my own fledgling Bill this evening!

I congratulate the noble Lord, as so often, for the ingenuity Which he continues to display in devising reasons for deferring the commencement of this part of the Bill. Although comparison between companies and trade unions has arisen again in his speech, I shall be only fairly brief in my references to it because it is pretty well trodden ground in the context of the debate so far, and possibly also because of the remarks liable to be made later by the noble Lord, Lord Aylestone, and the noble Lord, Lord Rochester, or, indeed, which have been implied by the noble Lord, Lord Rochester, on behalf of the noble Lord, Lord Aylestone.

It will not have escaped your Lordships' notice that the Bill which we are considering is the Trade Union Bill. That is what it is about: trade unions and the process of democracy within unions. Whatever the merits or demerits of the law governing political donations by other bodies, and whatever the arguments for and against the funding of political parties by other means, I do not think these have a place in a Bill about trade unions.

The review ballots which are provided for under Part III of the Bill could only possibly have wider implications if large numbers of trade unions were at present handing out their members' money for party political purposes against the wishes of the majority of those members. If the members want those payments to be made, then noble Lords opposite have nothing to fear. If the members want their representatives to play the part of power brokers in the processes of the party opposite, then there is nothing in this Bill to deny them that, in my view, rather dubious benefit. However, if the members do not want these things, what possible justification can there be for postponing their right to make their wishes known to those who purport to represent their interests? What is there in this Bill to which trade unions can object? If members of trade unions such as ASTMS, where only 10 per cent. or so contribute to the political fund, are genuinely content with the present situation, then that contentment will presumably be reflected in the result of their ballot.

Finally I should like to address myself to a recurring complaint made by noble Lords opposite: that other voluntary organisations, such as women's institutes, cricket clubs and the like, are not subject to the same controls on political spending as those applying to trade unions. I will not dwell on the question of how much money such organisations contribute to political parties, nor on the issue—though it seems to me to be a crucial one—of how voluntary being a member of a trade union actually is. But the fact is that party political involvement is a factor which colours the whole way in which a trade union represents its members.

Parliament therefore decided in 1913 that all the members of a trade union should be consulted before it spent their money on party political purposes. That principle is no longer upheld in practice because of the passage of time. Trade union members want the right to be consulted and the Government wish to give them that right as soon as this can be practically arranged. So, beguiling as the arguments of noble Lords opposite may seem, their intentions must be seen for what they are—to put off for as long as possible the evil day when a ballot must be held. I urge your Lordships not be seduced by so modest a proposal, and indeed to reject it.

Lord Wedderburn of Charlton

My Lords, the noble Earl continues to be hard on this matter. I would be suprised if Jonathan Swift would have approved of what one might call his defence by way of semantic gambit. In a trade union Bill, companies have no place. It is rather like saying that in an employment Bill, limitations on the right to strike have no place, or that bodies should not be considered in relation to the title of the Bill. The title and scope of the Bill are the Government's choice. And, of course, for eight months they forgot to put employers' associations in the Long Title. Then they realised that it was also concerned with employers' associations. All these are semantic moves around a board. I understand that the noble Earl has to make them.

There are, surely, three major points. The noble Earl says first that the Bill will allow members of the union to express their view if they want it. There is no Act that says that shareholders must have a statutory right to express their view if they want it. But even in regard to trades unions themselves, the noble Earl, with the greatest respect, has never understood a very simple point. He has never produced a rule book that prohibits someone moving resolutions to reconsider the political fund. The fact that it has not happened much may say something about the overwhelming understanding in trade unions. But there is that fact, and it is silly to say that the Bill introduces the right for the members for the first time, or to imply that it does so, because it just is not so.

Secondly, it is not just a question of members having extended rights under statute. The trade union objects, as defined, have been redefined. We say that if they have been redefined, the position of other organisations should be concerned. The mere fact that you have defined the title of your Bill so as to protect one party against another, be it a political party or a party with a small "p", cannot be a defence to the logic of an argument. Thirdly, it is a signal fact that trade unions are regulated by law strictly (and in future will be more tightly so) as no other association in our land is. I did not mention cricket clubs or women's institues. But if the noble Earl wants to mention them, then we can take them as well. It is, however, in relation to companies and other organisations such as British United Industrialists that I say that consideration should at least be given—by a Government that has more than a short term perspective of limiting trade union rights in regard to the broadest sort of social controversy—to a broad issue committee that would try to produce a better basis.

This issue will not go away—the issue of which bodies give money to political parties, on what basis and under which regulation of law. The fact that it has come up under the Trade Union Bill is adventitious. It came up under the Companies Bill, and if we have another Companies Bill, as we probably shall, we will make sure that it comes up there. It will be no good saying that you must not do something that equates companies with trade unions because the Bill is only about companies. It is a silly way to legislate. It is time for a sensible approach to this matter. No doubt one day we shall end up considering again support for political parties from other sources. But that seems a long way off. What we should do is get ourselves into a position where we can at least see how bodies support political parties today.

If we fail to do that, this point of division will grow, and the Government need not think that it will go away. The final remarks of the noble Earl reflect a very simple fact. Trade unions are a part of the labour movement. They are not likely to stop being so whatever happens to Bills of this kind. On that basis, I have no alternative—I am unhappy to have to take this course—but to beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 42 not moved.]

The Earl of Gowrie moved Amendment No. 43: Page 23, line 13, after ("II") insert ("and section 15 of this Act").

The noble Earl said: My Lords, this is a technical amendment relating to Clause 15, which was introduced during Committee stage and which deals with the employer check-off. Your Lordships will be aware that the Bill is not intended to impinge upon the jurisdiction applying in Northern Ireland, and this amendment would ensure that no statutory obligations attach to employers in Northern Ireland as a result of Clause 15 of the Bill. On this basis, I beg to move.

Lord Wedderburn of Charlton

My Lords, I wish to say a few words about this amendment. I listened carefully to what the noble Earl said. It introduces a quite major factor. He has not really explained, at least to our satisfaction, why Clause 15 should be included under this provision. It seems to us that it might well be a matter to which we would want to advert on Report stage, in the context of Part III as a whole.

The Earl of Gowrie

My Lords, we are just finishing the Report stage, so the noble Lord's last point is a little confusing. Perhaps he meant Third Reading.

Lord Wedderburn of Charlton

Yes, my Lords.

The Earl of Gowrie

My Lords, I am not quite clear if the noble Lord wants me to explain to the House why the Bill does not extend to Northern Ireland. Is that right?

Lord Wedderburn of Charlton

My Lords, I should like the noble Earl to say a word about it.

The Earl of Gowrie

My Lords, I am very happy to do that. This simply follows the precedents of our earlier employment legislation. It is the practice of the Secretary of State for Northern Ireland to consult with the industrial partners in the province before deciding whether to extend the provisions there. This has not yet been done in the case of the 1982 Act.

On Question, amendment agreed to.

The Earl of Gowrie moved Amendment No. 44: In the Title, line 4, leave out ("and") and insert ("to require trade unions to compile and maintain registers of members' names and addresses;").

The noble Earl said: My Lords, if I may, I should like to speak to Amendments Nos. 44 and 45 together. Amendment No. 45: Line 6, at end insert ("; and to amend sections 1 and 2 of the Employment Act 1980.").

These are the final amendments of a long and very interesting Report stage. Not even the excitements of Mr. Dikko, the proposals in the bus White Paper or the 19 supplementary questions of the noble Lord, Lord Underhill, were allowed to detain us for very long from consideration on Report. I am most grateful for the assiduity that the whole House has shown and the interest noble Lords have demonstrated in the Bill.

These are the final amendments before us, and therefore I can be extremely brief. Both amendments amend the Long Title of the Bill and are consequential upon Government amendments already carried. I beg to move.

On Question, amendment agreed to.

The Earl of Gowrie moved Amendment No. 45:

[Printed above.]

On Question, amendment agreed to.