HL Deb 27 November 2000 vol 619 cc1111-88

3.7 p.m.

Read a third time.

Clause 36 [Assistance by Commission for existing registered parties

The Parliamentary Under-Secretary of State, Lord Chancellor's Department (Lord Bach) moved Amendment No. 1: Page 30, line 32, leave out ("£500,000")and insert ("£700,000").

The noble Lord said: My Lords, this amendment fulfils a commitment that the Government gave on Report to increase, from £500,000 to £700,000, the funding available to assist registered parties to meet the start-up costs associated with the Bill. I know that the noble Lord, Lord Beaumont of Whitley, would have liked the funding to be paid over a period of five years, but I hope that he now accepts that it is preferable to distribute the funding available to qualifying political parties as soon as possible. This will enable parties to put in place quickly the necessary internal systems so that they can comply with the accounting requirements and the controls on donations set out in Parts III and IV of the Bill. I beg to move.

Lord Beaumont of Whitley

My Lords, I am extremely grateful to the noble Lord for small mercies—that is, if one can call an increase of £200,000 a "small mercy". As the noble Lord said, it is not exactly what I sought to achieve. However, as long as the administration and distribution of this money is dealt with both sensitively and fairly, I realise that that will enable the smaller parties not only to do exactly what they need to do to set up these arrangements but also to "squirrel" a little bit by to deal with what happens immediately after, thereby ensuring that they have the necessary mechanisms in place.

I have only one question for the Minister at this point. Can he confirm that there is no terrible little snag somewhere at the back of all this; namely, that, if the money is given in the first year, all of it has to be spent in the first year? Can the noble Lord also confirm that it will be possible for parties which receive this money to spend it over a period of time?

Lord Bach

My Lords, my understanding is that it does not have to be spent in the first year. If I am wrong about that, I shall, of course, let the noble Lord know.

On Question, amendment agreed to.

Clause 52 [Payments, services etc. not to be regarded as donations]:

Lord Bach moved Amendment No. 2: Page 41, line 27. leave out ("less") and insert ("not more").

The noble Lord said: My Lords, in moving government Amendment No. 2 I wish to speak also to Amendments Nos. 3, 13, 14, 15, 16, 19, 20, 23, 36, 37, 38, 41, 42, 43, 45, 46, 47 and 48.

I remind noble Lords opposite that these comprise the group of government amendments that the Opposition have promised they will not criticise for being brought forward at this stage. They are the balance of those amendments moved last week on Report by the noble Lord, Lord Mackay of Ardbrecknish, amending the terms "not less than £5,000" and "more than £5,000" about which he felt so strongly. The amendments simply complete that process we started at Report stage of converting references to "not less than £5,000", or whatever the sum might be, to references to "more than £5,000". For consistency we also need to change references to, for example, "less than £200" in Clause 76(2) to read "not more than £200". I beg to move.

On Question, amendment agreed to.

Clause 68 [Reporting of multiple small donations]:

Lord Bach moved Amendment No. 3: Page 54, line 17. leave out ("less") and insert ("not more").

On Question, amendment agreed to.

Clause 69 [Register of recordable donations]:

Lord Mackay of Ardbrecknish moved Amendment No. 4: Page 54, line 42, at end insert— ("(6) The Secretary of State may by order make provision for exempting from inclusion in the register maintained by the Commission under this section any specified details in respect of donations to parties registered in the Northern Ireland register. (7) An order under subsection (6) shall be so made as to—

  1. (a) apply to the specified details in respect of donations to every Northern Ireland party, and
  2. (b) make the same provision with respect to every such party.
(8) In this section — Northern Ireland party" means a party registered in the Northern Ireland register; "specified" means specified in an order under subsection (6).").

The noble Lord said: My Lords, this group of amendments concerns the proposed exemption from the whole of Part IV of political parties in Northern Ireland. During the Committee and Report stages we had some enlightening but often, I regret to say, frustrating debates on these matters.

The Neill committee, on whose recommendations the Bill is based, did not recommend a complete exemption from the controls on donations which now comprise Part IV of the Bill. Despite what the noble Lord. Lord Bassam, has said on previous occasions, what the Government propose goes far beyond what the Neill committee thought necessary.

We now have the situation where, certainly until 2005 and possibly beyond, none of the provisions on donations in Part IV will apply to any registered political party in Northern Ireland. I should say, first, that a four-year renewal period is unacceptable. In Committee in another place, the Minister, Mr Tipping, gave some support to the idea of a 12-month renewal. That is what my Amendments Nos. 9 and 10 are intended to achieve. However, the main point is the substance of the exemption from Part IV. During a previous debate the Minister said that politics in Northern Ireland are not yet conducted on the same basis as in the rest of the United Kingdom. I wonder what he meant by that. Surely, he did not refer to the activities of Sinn Fein, for example, now regarded by the Government as legitimate enough to take its place and have Ministers in the Northern Ireland Executive. What are the "special factors" relating to Northern Ireland to which the Minister has repeatedly referred? In what circumstances does the Minister envisage that Part IV will be applied to Northern Ireland only partially? We never had any explanation of what was meant by that.

The situation in the Bill as at present drafted has a number of serious implications. First, there is the question of foreign funding. The Neill committee recommended a very limited exemption to the general ban on foreign funding. One of the central points of the Bill is that political parties in the United Kingdom should no longer be allowed to receive funding from anyone abroad. That is one of the central points of the Bill and of the Neill report.

The Neill committee stated, however, that as regards Northern Ireland there may be a case for exempting citizens of the Republic of Ireland, resident in the Republic and subject to compliance with that country's electoral law; that is, they should be allowed to donate to Northern Ireland parties. My Amendment No. 6 reflects that point. But that is not what the Government intend to allow in the Bill. They intend to allow anyone living anywhere in the world, be it America, Australia or wherever, to give money to political parties in Northern Ireland. The noble Lord, Lord Bassam of Brighton, admitted that on 11 th May, after rather an effort on my part to get him to do so. He said, The question that has been asked is whether a person in the USA can give money to a Northern Ireland party. Fairly and honestly, I believe that, yes, he probably can".—[Official Report. 11/5/00; col. 1823.] The Minister could have missed out the word "probably"; the fact is that such a person can do so.

The noble Lord, Lord Molyneaux, said on 18th October that it was believed that the fund-raiser, Mr Galvin, had now transferred his allegiance to the Real IRA and the Continuity IRA and that those organisations intended to field candidates who would be backed by the foreign money that the Government were perfectly content to allow to flow to Northern Ireland parties.

I shall not speak in detail about the anomalies the provision creates. The most obvious example from my point of view is that the Irish diaspora, predominantly that in America, will be allowed to donate to Sinn Fein but the Scottish and Welsh diaspora will not be allowed to donate to the SNP or to Plaid Cymru. In that respect at least, violence has paid.

We also discovered a further issue in debate. Despite the Minister's initially strong assertion that it was not the case he eventually had to admit that Northern Ireland parties can use foreign money to campaign both in Northern Ireland in a referendum on the constitutional status of Northern Ireland and in the United Kingdom on a GB-wide referendum, for example, on the euro or on proportional representation. I have no doubt that even now some are considering the loopholes the Government have created to see how they can be exploited in any future referendum. What really worries me is that a referendum on the constitutional status of Northern Ireland could be seriously affected by foreign money.

On 18th October the noble Lord, Lord Bassam, said: I like to be straight with your Lordships' House. The information I have from officials is that Northern Ireland parties can use the fruits of money raised abroad in a UK referendum".—[Official Report, 18/10/00; col. 1038.] But no one else can, not the Labour Party, not the Conservative Party, not the Liberal Democrats nor the Scottish nationalists. No political party in Great Britain would be allowed to do that. The Minister concluded at col. 1038: That may well present difficulties". Later that day he spoke of the need to ban foreign funding of referendums in the whole of the United Kingdom. Therefore he seemed to be aware of the dangers we had highlighted. However, those difficulties vanished into thin air, along with the need to ban the foreign funding of referendums. By 24th October the Minister said that he was, not persuaded of the case for preventing a Northern Ireland party using the proceeds of a foreign donation to meet its own referendum expenses".—[Official Report, 24/10/00, col. 191.]. Not only will Northern Ireland parties be allowed to take foreign money for ordinary elections, they will also, unlike all other UK parties, be allowed to take foreign money for referendums. That seems an amazing exemption.

We have dragged the Minister and his officials, kicking and screaming, to admit that the situation I have described exists. The Bill's ban on foreign participation in referendum campaigns is a sham for a number of other reasons, but here we have the Government explicitly and consciously allowing foreign funding to be used in referendums in Northern Ireland and the rest of the United Kingdom. That is plainly wrong. My Amendment No. 11 would go some way, although, I admit, not all the way, to address the point.

We have tried to approach the Bill in a spirit of compromise. The amendments the Government moved a few moments ago were the result of agreement between us. I have tried to envisage how we can find a way to help the Government obey the recommendations of the Neill committee and yet stop the foreign funding. I have conceded the issue of public reporting of donations over £5,000 on security grounds. As I said on Report, the Government have repeatedly justified all they are doing on the basis of donations needing to be kept confidential for the reason that someone in Northern Ireland who was known to give a large donation to a political party might be in danger from some of the men of violence.

If the Government had really believed that there were serious security considerations, they would have done exactly what I suggested doing. But they have gone much further. I am perfectly content to have donations to Northern Ireland parties kept secure and not made public. I think that that is quite reasonable. Amendment No. 4 does just that: no public disclosure of donors' names; and leaving out Clause 70 would achieve that objective. So the Government cannot complain that I have not taken on board their security argument.

The Minister admitted that Amendment No. 4 was something the Government had considered. He gave the impression that they were still considering it. But he said that it should be in addition to, and not in place of, the wider powers in Clause 70 which would allow them to exempt Northern Ireland parties from other parts of the Bill. He claimed—I thought that it stretched credulity somewhat—that one could not give the list of donations to the electoral commission and not make it public because the electoral commission might leak donors' names. What a condemnation of the Government's view of the electoral commission they are about to set up. What confidence can parties on this side of the Irish Sea have in giving confidential information to an electoral commission that the Government themselves say cannot be made leak-proof?

As I said on Report, the continuation of foreign funding from North America, or any other foreign country, for Sinn Fein/IRA and other republican groups cannot be justified on any grounds whatsoever. The Government cannot logically make the leap from wanting to ensure donors' anonymity to a complex exemption from the ban on foreign funds.

I accepted that the Neill committee suggested that there is a problem with the Republic. Largely at the prompting of the noble Lord, Lord Goodhart, I lifted from the Government of Ireland legislation of 1947 the idea that Ireland was not a foreign country and, therefore, accepted that people who had votes and were resident in the Republic could give money to Northern Ireland parties. Initially I thought that the easy way out would be to allow them to give money to any British political party, but the Government did not like that so I have narrowed the issue further.

The three provisions I put forward are hardly options because one builds on another, but I refer to them as the three options before your Lordships. First—I do not disguise the fact that it is my preferred solution— Amendment No. 12 on its own would remove entirely any special provision for Northern Ireland parties and make Northern Ireland parties subject to the same rules and regulations as parties in Great Britain. However, I have listened to the Government's case and I know that they will not accept that. I am aware of what the Neil committee said.

The combination of Amendment No. 4 with Amendment No. 12 would stop donors' names being made public. That is what the Government have said they want for security reasons. But it would also mean that there would be no foreign funding. The electoral commission would know where the money was coming from and the parties would have to observe the rule on not accepting impermissible donations.

My third building block, the third option—it is not my preferred one, but it is a good deal better than the provisions in the Bill—brings in Amendments Nos. 6 and 8. It would allow the foreign funding of Northern Ireland parties to come from the Republic of Ireland only. Only Northern Ireland parties could be so funded and foreign donations could come only from the Republic of Ireland which, according to the Government of Ireland measure, is not a foreign country. It would also mean that the names of large donors would not be made public so they would still be secure. That would mean that in Northern Ireland parties would have to observe the rules on donations; the commission would be able to ensure that they were not accepting money from abroad; but they would be able to receive funding from the Republic of Ireland.

As I have indicated, Amendments Nos. 9 to 11 are ancillary to the main question. They are about the renewal period. Amendment No. 11 refers to referendums.

Noble Lords have had before the House over the past few weeks a number of measures which many of us believe amount to a massive concession to the men of terror. As well as the provisions in the Bill which allow for foreign funding, we have had the Police (Northern Ireland) Bill which, as we predicted, has undermined morale in the RUC and risks undermining the fight against terrorism. Over the weekend a senior officer has indicated that he no longer wishes to serve in the RUC. Then we have the sinister Disqualifications Bill which has never been properly justified.

It seems to me that in this Bill there is another huge concession without anything given in return, as usual. We oppose what the Government are doing. We believe that it sends out dangerous signals. I have gone a long way to take on board what the Neil committee recommended. I have gone a long way to take on board the problems the Government put before your Lordships' House in defence of what they sought to do. I believe that my amendments together represent the taking on board of the Neill committee's report and represent a sensible way forward which would bring the Government and Opposition together. However, if not, I shall seek the opinion of the House. I hope that noble Lords will consider the issue in a dispassionate way, will see how far my amendments accommodate the objections and, if necessary, will join me. I remind the Liberal Democrats that in another place they voted against the clause standing part of the Bill. I look forward to their transferring that support to your Lordships' House. I beg to move.

Lord Molyneaux of Killead

My Lords, I fully support this group of amendments. We have to consider this rather peculiar provision, in particular Clause 70, in the context of what we have been doing in your Lordships' House over past months, and during the past two weeks. The provisions to permit the IRA in various forms to import unlimited funds from abroad were included in this Bill for reasons which were entirely unconnected with the Neill report. Like several other unique Bills in this category, they come into the "most favoured son" group. The obsession so prevalent in both Houses is that of extra-special treatment of terrorist parties: they have to be placated at all costs, even at the costs of integrity and of honesty. The second obsession is that we in your Lordships' House must avoid sending the wrong signal to terrorists just in case they get annoyed. So we grovel and lick boots in the expectation that our taskmasters in the various terrorist groups, from both sides of the community, will observe obligations and keep their part of any bargain. As many noble Lords have said on other occasions, it is a vain hope. But we now have proof positive of their inability and unwillingness to observe any contract into which they may have entered.

So I ask: is it any wonder that they, the terrorists, despise the lot of us? Can Her Majesty's Government justify Clause 70, with its endearing rubric, on grounds other than what I call the "most favoured son" formula which the Parliament of the United Kingdom has been induced to swallow thus far?

On a similar occasion some weeks ago, I asked your Lordships—I apologise for the language—whether there is anything to which we will not stoop. Last week we completed the passage of the Police (Northern Ireland) Bill. The IRA/Sinn Fein grouping has thrown that back in our face in the past 24 hours; and, worse, it has completely wrecked the plans for a new police service consisting of a 50:50 composition. Most, if not all of us, were in favour of a balance representing both sides of the Northern Ireland community in the new force. But Sinn Fein/IRA has this weekend warned Catholics not to join the new service. It has warned those who might volunteer and be suitable to serve on the new police body. Saying that they cannot advise nationalists to serve is code for intimidation—kneecapping and all the rest of it; we have seen it all before. People who serve on the new police board will be putting their lives on the line. There is no doubt about that.

The IRA has gone further and dragged the entire nationalist community into a virtual boycott of all the constructive passages of the Patten report. My comments apply equally to Clause 70, because the terrorist groupings will cheat and cheat again. They will not keep their word.

The noble Lord, Lord Mackay, quoted the Neill report, which says early on: Political parties should in principle be banned from receiving foreign donations". Why are we exempting from that a political party—or rather a terrorist movement masquerading as a political party? The Neill report went on: In relation to donations to political parties in Northern Ireland, the definition of a permissible source should also include a citizen of the Republic of Ireland resident in the Republic subject to compliance with the Republic's Electoral Act". The Neill committee incorporated a Sinn Fein exemption into its fifth report. It will not benefit the Ulster Unionist Party, the Alliance Party, the Democratic Unionist Party or any other properly constituted democratic party except the nationalist parties, and in particular Sinn Fein. Much to my regret, Sinn Fein will dominate the nationalist grouping and the nationalist community in general, as has been proved over the past 48 hours.

I particularly support the point made by the noble Lord, Lord Mackay, about the confidentiality of donors. If names are to be disclosed, Catholics will be limited in their financial contributions to supporting one party only—Sinn Fein/IRA. It does not take much imagination, particularly among those of us who come from Northern Ireland or have served there, to understand that that intimidation will be carried through to the ballot box.

3.30 p.m.

Lord Fitt

My Lords, over the weekend I watched a video cassette that had been sent to me from Northern Ireland. It was a recording of an Ulster Television "Insight" programme. The programme contained a discussion about the relative merits of Sinn Fein and the SDLP and which one better represented the nationalist population in Northern Ireland. When the SDLP representative was asked why his party had refused to condemn many of the murders and atrocities carried out by the Provisional IRA over the past year, I was disheartened to hear him answer that it was in case it made the party sound like unionists. What a very lame excuse. Presumably the fact that I am supporting the Opposition and the noble Lord, Lord Molyneaux, makes me sound like a unionist. I do not believe that I do. I believe that the amendment should have been taken up long ago in the deliberations that have affected this country and its relations with the IRA.

Only this weekend we read in the Northern Ireland newspapers that the relatives of the victims of the Omagh bomb courageously took it upon themselves to come to a public house in the north of London, where, in a room above the bar, representatives of the Continuity IRA—the political arm of the Real IRA, which carried out that atrocious bombing that caused such tragedy in Northern Ireland—were collecting funds from the patrons, be they Irish or English. I take it that they were appealing to the Irish community in London.

How can that be justified? Again I refer to the speech of the noble Lord, Lord Mackay. Eric Anderson, who has just resigned, was one of the most dedicated senior policemen whom I have ever met in Northern Ireland. He carried out all the investigations into that terrible tragedy and the people who brought it about. He has just given notification that he is going to resign because he cannot accept some of the recommendations in the Patten report. He knows the identity of those who carried out the bombing in Omagh, but he cannot bring them before a court because it is very hard to get evidence. Does anyone believe that he can be replaced? Does anyone believe that any other member of the Royal Ulster Constabulary will be able to carry on where he has left off? I do not think that that is possible.

It is a contradiction that the House appears unwilling to ban contributions that come from the United States to reinforce the armed rebellion among the different factions of the IRA. The Government are not expressing the view of the vast majority of the people in the island of Ireland by permitting contributions to be brought from America to support the different factions in the IRA—and making excuses for doing so.

Northern Ireland is allegedly a foreign country, but I know from my experience at the SDLP's yearly functions in the Republic that the amount that we received from people there to help our political objectives would not bankrupt the exchequer. We can push that aside. However, Sinn Fein/IRA receive subscriptions from America. One group in America is ably led by a man called Martin Galvin, who broke away from the Provisional IRA and is now getting funds to support the Real IRA—the group that let off the bomb at MI6 headquarters and has continued a series of minor explosions in this country. Only the financial assistance of some seriously misguided people in the United States of America makes that possible. I hope that any legislation that we pass will do everything possible to stop foreign subscriptions to such organisations.

Lord Sanderson of Bowden

My Lords, I strongly support the amendment tabled by my noble friend Lord Mackay. Having had the difficult honour of being the chairman of a political party north of the Border, I know the strength of the links between Scotland and Canada and the United States of America. I cannot for the life of me see why I, as a previous chairman, should be prevented from asking Scots over there for money to fight elections, when my colleagues in the Ulster Unionists will be able to do so. I hope that my noble friend will press his amendment most strongly.

I wish to raise one other point. Amendment No. 6 seeks to include, citizens of the Republic of Ireland resident in the Republic (subject to compliance with the Republic's Electoral Act 1997)". I do not know the terms of that particular Act. I only hope—my noble friend may be able to enlighten me—that residents in the Republic of Ireland will not be a post box for those further afield who may enter the lists at election time.

Lord Dubs

My Lords, only a few days ago we read in the newspapers that the British and Irish governments had jointly approached the American Government to ask that the Real IRA be declared a terrorist organisation. That was done with the intention of closing up funds from North America to the Real IRA. It was a very clear step.

I believe that there is confusion in the minds of some Members of this House as to the money that goes, I suggest, illegally and completely improperly from North America to fund terrorism in the United Kingdom. It does not require the clauses which the noble Lord, Lord Mackay, wants to amend to enable that flow of money to take place, even though for the past 30 years the British Government have done their best to prevent such a supply of money funding terrorism in Northern Ireland. The money does not have to be processed through a political party. The terrorists have only to raise the money, spend it in eastern Europe and then smuggle arms, weapons, bombs and explosives into Ireland to be used in Northern Ireland or in Britain.

Therefore, I do not believe that the argument that the Government are soft on terrorism—an argument that the noble Lord, Lord Mackay, used in relation to the Police (Northern Ireland) Bill and the Disqualifications Bill—is legitimate. Surely we are talking about money which is used for political purposes. Whatever the closeness of the links between Sinn Fein and the IRA—I do not dispute the closeness of those links—nevertheless, Sinn Fein also happens to be a legitimate political party. We may not like it, but if Sinn Fein seeks to raise money for legitimate democratic purposes, we should recognise that that is what it seeks to do.

The noble Lord, Lord Fitt, said that very little money for the SDLP came from the Republic. I believe that there is sufficient to make it important for the SDLP to raise its money there. The difficulty lies in the fact that there is no neat way out of the dilemma that has been posed. Sinn Fein happens to be a political party, both in Northern Ireland and in the Republic. As such, it can raise money for its political activities in the Republic and it is then not difficult for it to use some of that money for political purposes in Northern Ireland.

There is no neat way out of the dilemma. That is why I believe that the Government are right to include the clauses in the Bill. And that is why I do not believe that the noble Lord, Lord Mackay, is right to suggest that the clauses should be removed. I repeat: it is a very difficult problem. The Government have done their best to find a way through it and I believe that they have succeeded. For that reason, I hope that these amendments will not succeed.

Lord Monson

My Lords, the noble Lords, Lord Mackay of Ardbrecknish, Lord Molyneaux and Lord Fitt, powerfully drew our attention to the extraordinary series of concessions, not least the legislative concessions, made to Sinn Fein/IRA. Having observed them at reasonably close quarters over the past three-and-a-half years, I cannot believe that in their hearts most members of this Government welcome so many concessions to such a group. One can only suppose that they are acting under duress but that, for reasons of maintaining public confidence, that cannot be admitted publicly.

3.45 p.m.

Lord Rees-Mogg

My Lords, I support the amendments moved by the noble Lord, Lord Mackay of Ardbrecknish, on somewhat different grounds. I believe that a serious constitutional position arises and I very much hope that the Members on the Liberal Democrat Benches will consider these issues. In recent years we have adopted a strong principle that our constitution rests on equality and that there should not be discrimination in terms of gender, race or, indeed, colour. However, there is an inherent proposal in the Bill that there should be a discrimination in terms of geography.

The European Convention on Human Rights, which we have adopted into our own law, seems to me also to be based on a principle of equality; that is, it is against human rights for a legal provision to be made which has radically different effects on different groups on a purely arbitrary basis. I believe that these amendments would improve the Bill substantially by bringing it nearer to the constitutional equality which it has been a major aim of the present Government to secure in relation to other matters.

Let us look at the experience of other countries. A major issue which has arisen in the United States is whether there should be equality under the constitution. In the 1954 case which resulted in a declaration that there should not be segregation in education, it was determined that "equal but different" means "unequal"; that is, it cannot be claimed that something is all right although it is a discrimination because, in some other sense, it is equal.

In this case, I do not believe that it can even be said that the treatment of the non-Northern Ireland parties and the parties in the rest of the United Kingdom is equal. However, if in some sense that could be held out to be so, the position would remain essentially unequal and essentially a discrimination.

Therefore, the question which arises is: if we pass the Bill as the Government would like in an unamended form and if the Government persist in their view that they will not accept all or any of the amendments in the name of the noble Lord, Lord Mackay, shall we be passing a Bill that meets the tests of law, including the tests of the convention on human rights? That is a matter which may come before your Lordships' House in another way through the ordinary process of litigation.

Baroness Park of Monmouth

My Lords, I strongly support the amendment. I believe that on the last occasion that we discussed this matter, I asked the noble and learned Lord, Lord Falconer, whether Sinn Fein/IRA had supported, and had said that it would support, the proposal that Catholics should enter the RUC. I received no answer to that question. Sinn Fein/IRA has given that answer since and it has been no surprise to most of us.

Perhaps I may suggest strongly that, if the House does not accept this amendment, the people of Omagh will lose all faith in the process of justice. I am afraid that it is no good to say that Sinn Fein is a political party struggling to escape from its unwelcome IRA encumbrance. Sinn Fein/IRA consists of the very people who, when the people of Omagh appealed to both Gerry Adams and Martin McGuinness to set the witnesses free and tell them they could testify, said that they would not do so because they did not recognise British justice.

If Sinn Fein is a political party in the United Kingdom which does not recognise British justice, I suggest that it is the last party to which we should give special concessions. The people of Omagh will judge us. They will say, "You passed the terrorism Act; you said how hard you would be on terrorism; and the terrorism Act says that money to these people will be stopped. But when an opportunity comes, instead of stopping it, you actually create a position in this Bill in which they will receive favourable treatment and be able to obtain money". That will be absolutely incomprehensible and I suggest very strongly that it would be utterly wrong to accept it.

I hope that the Government will reflect on the fact that Sinn Fein/IRA has now come out into the open and said that it will not support Catholics in the RUC. At the same time, the best of the RUC are going. One thing which Sinn Fein/IRA has been calling for is the disbanding of the Special Branch. We can expect a good deal of action in the United Kingdom which may not be very agreeable and it will serve us right.

Lord Peyton of Yeovil

My Lords, I strongly support that question which my noble friend Lady Park has addressed to the Government. She is asking what kind of message the Government expect will be received in Northern Ireland. With respect, I do not believe that the emollient efforts of the noble Lord, Lord Dubs, will be of any great assistance to them.

I found the speech of my noble friend Lord Mackay very convincing indeed. It was a real effort to recognise the difficulties which the Government face in relation to this appalling problem. He went a long way to make it easy for them by not pressing for the omission of Clause 70.

As this debate has gone on, it has taken on more and more of the quality of a nightmare. I have begun to wonder more and more whether I am taking part in or listening to a procedure which is real. My noble friend on the Front Bench talked of another huge concession without any return so far, nor expected. It is just another huge concession. I wonder how on earth the noble Lord on the Front Bench, admittedly not a senior member of the Government, will have the gall to answer that challenge. He must reply also to the noble Lord, Lord Molyneaux, who pointed out that this was a concession—I believe I have his words correctly—to our taskmasters in the various terrorist groups. When the noble Lord replies, I hope that he will remember what the noble Lord, Lord Molyneaux said; namely, that this is another huge concession to our taskmasters in the various terrorist groups. We heard too from the noble Lord, Lord Fitt. He never fails to move me because he speaks from terrible experience.

What I find odd—maybe I am wrong; I hope I am—is that in a short time we shall have the spectacle of the noble Lord, Lord Bassam of Brighton, representing the Government of this country, representing all of us in a manner of speaking, in delivering the message that this Government are prepared to facilitate the collection and passage of money by Sinn Fein or its agents from foreign countries for whatever use may be contemplated. It is all very well for the noble Lord to shake his head. I hope he will lend some force to his apparent rejection of what I am saying when he gets to his feet and defends what most of us believe to be totally and absolutely indefensible.

In conclusion, I want to say that the message which the noble Lord will he delivering this afternoon, in the event that he does not, on behalf of the Government, accept the amendment, is one which for all of us now involves unlimited shame and may well, in the future, provoke physical results of which we shall all bear the consequences.

Lord McNally

My Lords, since it was pointedly asked which way noble Lords on these Benches will vote this afternoon, I can tell the House that we shall be supporting the Government.

It is very easy for those on the Conservative Benches to make emotional speeches. It is worth considering—and it is now on the public record—that it is now nearly 20 years since a leading member of the government of the noble Baroness, Lady Thatcher, the late Lord Whitelaw, entered into direct negotiations with the IRA. Sometimes, some of the speeches this afternoon from those Benches have had the whiff of one more push; that, somehow, there is an alternative which is easily available to a government with more backbone militarily to defeat the IRA.

Baroness Park of Monmouth

My Lords, I merely wish to ask the noble Lord whether he does not draw a distinction between negotiating with what were then people who might conceivably behave in a civilised way eventually and people whom we now know do not behave in a civilised way. We have had years of experience.

Lord McNally

My Lords, I believe that terrorists behave in an uncivilised way full stop. But politicians have a duty not to support them, as the noble Baroness said from a sedentary position, but to try to find a way forward to peace. Of course, just as Lord Whitelaw must have done 20 years ago, the present Government face that horrific dilemma of negotiating with men of violence. Those are difficult dilemmas. I often think of George Woodcock's description of good trade unionism being shabby compromises. There is a lot in the peace process which is shabby compromise. But the peace process is about giving some kind of breathing space for the normality of politics to return to Northern Ireland.

We know that around that process, there are those who will be determined actively to destroy it. The fact is that to give peace a chance, the Executive and the political process, such as it is, with its defects, must he given a breathing space. We believe that this is part of a package of legislation, as has been pointed out, and it does provide such a breathing space. It will be abused; attempts will be made to undermine it by the men of violence; but it gives the men of peace something to hang on to and to build on as well.

As the Neill committee recognised, we all know that it is possible to dog-leg funds through the Republic of Ireland and for the terrorists to cheat. But, as the noble Lord, Lord Dubs, mentioned, action can be taken. The joint demarches by the British Government and the Government of the Irish Republic are examples of that.

I thought that the noble Lord, Lord Mackay of Ardbrecknish, made an extremely effective speech. On these Benches, we must take a balance of judgment. It is not right on one side. If it were that simple, we should have either defeated the IRA or returned Northern Ireland to some perfect democracy. But neither is on offer at the moment. What is on offer is a peace process which needs help. Because we believe it needs help and because we believe that this Government are trying to make that peace process work, we shall be with them in the Division Lobby today.

4 p.m.

Lord Goodhart

My Lords, I want to speak personally and not on behalf of my party. I have made my personal position clear to my noble friends, and they have accepted it. Having signed the report of the Neill committee, it would not be honourable for me to vote in a manner inconsistent with the report to which I have put my name. In no way is this a criticism of my party or of the stand being taken by it on this issue. Had I not been a member of the Neill committee I should have been in an entirely different position. Personally, I shall be unable to vote on any Division on these amendments.

The Parliamentary Under-Secretary of State, Home Office (Lord Bassam of Brighton)

My Lords, with these amendments we return to the vexed matter of the special provisions for Northern Ireland parties. I readily admit that it is a vexed matter, with strong passions running on both sides of the argument. The House is by now well aware of the case made by the Neill committee for these special provisions, so I shall not detain the House by going over that ground again, but shall confine my remarks to the amendments before us.

The amendments address four different aspects of Clause 70: first, the exemption from disclosure; secondly, the exemption from the ban on foreign funding; thirdly, the time limit on any order made under subsection (1); and, finally, the effect of the exemption in respect of the ban on foreign funding on a referendum campaign. I shall address each of those points in turn.

Amendments Nos. 4, 7 and 8 address the issue of disclosure. They seek to take what some may describe as the middle road between applying the controls in full to Northern Ireland parties and a complete exemption. As I indicated on Report, that is a middle way which the Government have previously closely examined. We have concluded, however, that it is not an approach that we can adopt at this time.

Concern has been expressed that the disclosure of donations to the electoral commission, but not more widely, would not provide the necessary assurance to donors in Northern Ireland. Let me make it perfectly clear that this is not because the Government lack confidence in the ability of the commission to keep information about donors in Northern Ireland parties confidential. The key consideration here is public perception. We know that sections of the community in Northern Ireland do not have full confidence in the public institutions operating in that part of the United Kingdom. Whatever the reality of the situation, there will be a perception that information given in confidence to the electoral commission will somehow leak out.

Consequently, this half-way house will not take the trick. If donors are fearful that their details will be made known, they will stop making donations and it would, as a result, become very difficult for democratic parties in Northern Ireland to operate effectively. Such a result would not advance the peace process. At this time, therefore, I cannot commend this middle way to the House.

Amendment No. 6 seeks to give effect to the letter of the Neill committee's Recommendation 29. Let me remind the House why we think that this particular recommendation is impractical. Under the amendment, a party in Northern Ireland could accept a donation from a citizen of the Republic of Ireland resident in the Republic, subject to that person's compliance with the Republic's Electoral Act 1997.

The first difficulty with that approach is that we do not believe that it would be practical to require that a United Kingdom party satisfy itself that a donor complies with legislation in force in another state, in another jurisdiction.

The second difficulty with this approach is that it would simply serve no useful end. The noble Lord knows very well that the Republic of Ireland's legislation in this area does not ban the foreign funding of political parties. I make no comment about t hat as it is clearly a matter for the Irish state. But, in the absence of such a ban, any citizen of the Republic could accept a donation from the United States or elsewhere and then simply reroute it to a party in Northern Ireland. The noble Lord has argued that we should at least make an attempt to confine the foreign funding of parties in Northern Ireland to funds emanating from the South of Ireland, but this amendment patently fails to do that. If the amendment has no effect in practice, frankly it should not be made.

Amendments Nos. 9 and 10 relate to the time limit on any order made under subsection (1) of Clause 70. On Report the House accepted a government amendment to limit the life of such an order to four years. It is right and proper that an exemption order should be subject to regular review and we believe that once every four years or so is about right. These two amendments would require an annual review. I put it to the House that that is too frequent. We very much hope that the political climate in Northern Ireland will continue to improve year on year.

I believe that the impassioned plea made by the noble Lord, Lord McNally, is right. This process is not and never will be perfect, but we have to do all that we can to help it. This is not the same as saying that the political situation will have changed sufficiently one year over another to justify an annual review of a Clause 70 order. I invite the House to stick at four years, albeit with the possibility of an interim review should the climate change materially, as we all hope, in which case the order then in force could, if appropriate, be revoked.

Finally, Amendment No. 11 returns to the issue of foreign funds being used by a Northern Ireland party to meet the costs of a referendum campaign. I am aware that the noble Lord, Lord Mackay, continues to be unhappy about such a consequence of a Clause 70 order.

If, as we propose, an order is made under Clause 70 to exempt Northern Ireland parties from the restrictions on the acceptance of donations, that exemption will apply for all purposes. It is not, and never has been, our intention to allow Northern Ireland parties to accept foreign donations to meet their general running costs or to meet the cost of election campaigning, but not to meet the cost of a referendum campaign. On what possible grounds can such a distinction be made? There is simply no case for this amendment.

The noble Lord is perfectly entitled to argue that there should be no special provisions whatsoever for Northern Ireland. It is up to your Lordship's House to decide whether to accept the noble Lord's case or to accept the Government's and the Neill committee's case. If your Lordship's House comes down in favour of Clause 70, the case for Amendment No. 11 simply evaporates. The fact that a Northern Ireland party may use foreign donations to fund a referendum campaign raises no new issues.

At each stage of this Bill we have heard the arguments for and against Clause 70. Sadly, there has been no meeting of minds at least between these Benches and those of the Official Opposition. The time has come to decide once and for all whether this clause should stand part of the Bill. I put it to the House that there are compelling arguments for these special provisions and I therefore invite the House to reject these amendments.

Lord Mackay of Ardbrecknish

My Lords, perhaps I may comment on the Minister's reply in reverse order. On foreign funding for referendums, he seems to be quite happy that that should go ahead and he seems to accept, in fact almost suggests, that the Government deliberately set out to allow that. To take a narrow aspect, if the Scottish National Party ever arrives at the stage—I hope that it will not—of forcing a referendum on an independent Scotland, it seems to me that there would be no justification for saying, "No, you cannot have foreign money"; whereas in a referendum on the future of Northern Ireland, we could say to one side of that argument, "You can have foreign money". The position is totally without logic and—dare I say it? — totally without integrity.

The third point, the limit of four years, is not the most important part of these amendments, but it seems to me that if the Government are to make progress on Northern Ireland and want to sweep away all these exemptions as soon as possible, which I understand is the Minister's position, they would be better reviewing the situation once every year rather than once every four years. However, that is the least important of the four amendments.

On the second point—essentially, of how we can check whether money that has come from a donor in the Republic has not originated in the United States—the same question could be asked in relation to Great Britain. How will we check that? The electoral commission will carry out some checking, as no doubt will political parties. But I fully accept that it would be wrong for the other political parties in Northern Ireland to know about large donors, wherever they are from, for reasons of which we are all aware.

However, I should have thought that, with all the co-operation we have with the Republic's government, it would not be too much to ask them to go a step further and help the electoral commission in any investigation it had to conduct in relation to a large donor in the South. I should have thought that that was a small price for the Republic of Ireland to pay in return for all that it has had from the United Kingdom Government over the past few years. So I do not believe the noble Lord made a case at all in that regard.

On the question of donations and keeping them confidential, perhaps if there had been a fourth stage of the Bill—thank goodness, there is not; that is one thing at least on which the Ministers agree with me—I might have knocked out the fact that we should tell the electoral commission and allow Northern Ireland parties not to report their donations of £5,000 to anyone. But it is an amazing proposition that we cannot trust the electoral commission with confidential information.

This has been a sad debate. I say to the noble Lord, Lord McNally, that I hope that his friends in the other place who voted with us on these issues in the Commons do not read in Hansard what he has said today. I do not believe the exaggerated nature of his speech, which was more or less that this would be a threat to the whole peace process, to be in the least bit justified. I noted what the noble Lord, Lord Dubs, said—that Sinn Fein should be allowed to seek to raise money for legitimate political purposes. I have no problem with that. But why, in reality, should they be the only people who are allowed to raise money for legitimate political purposes outside these islands? The Labour Party is not allowed to and I do not believe for a moment that anything the Labour Party raised would not be used legitimately.

Lord Dubs

My Lords, because it is the only political party which operates both within the United Kingdom and in another country.

Lord Mackay of Ardbrecknish

My Lords, my exemption of the Republic of Ireland electors from the ban addresses the noble Lord's point. That is my original point about this being a series of bricks that builds up the position where I take on board the objections of noble Lords opposite.

With the exception of the two noble Lords I mentioned and the Minister, no noble Lord is in the least happy. I could repeat some of the points made. I shall not do so, apart from to say this. If the noble Lord, Lord Fitt, believes these amendments to be proper and sensible amendments to accept, it might be worth those noble Lords who intend meekly to obey the Government Whip thinking about it before they vote. I commend the amendment to the House.

4.13 p.m.

On Question, Whether the said amendment (No. 4) shall be agreed to?

Their Lordships divided: Contents, 148; Not-Contents, 167.

Division No. 1
Aberdare, L. Hogg, B.
Ackner, L. Home, E.
Alexander of Weedon, L. Hooper, B.
Allenby of Megiddo, V. Howe, E.
Ampthill, L. Howe of Aberavon, L.
Anelay of St Johns, B. Howell of Guildford, L.
Arran, E. Hunt of Wirral, L.
Ashcroft, L. James of Holland Park, B.
Astor, V. Jellicoe, E.
Astor of Hever, L. Jopling, L.
Attlee, E. Kimball, L.
Barber, L. Kingsland, L.
Belstead, L. Lamont of Lerwick, L.
Blackwell, L. Lane of Horsell, L.
Blatch, B. Liverpool, E.
Brabazon of Tara, L. Luke, L.
Bridgeman, V. Lyell, L.
Brougham and Vaux, L. McColl of Dulwich, L.
Burnham, L. [Teller] Macfarlane of Bearsden, L.
Buscombe, B. Mackay of Ardbrecknish, L.
Butterworth, L. Mackay of Clashfem, L.
Byford, B. Marlesford, L.
Campbell of Alloway, L. Marsh, L.
Campbell of Croy, L. Mason of Barnsley, L.
Carlisle of Bucklow, L. Miller of Hendon, B.
Carnegy of Lour, B. Molyneaux of Killead, L.
Chadlington, L. Monson, L.
Chilver, L. Montrose, D.
Cockfield, L. Moore of Lower Marsh, L.
Coe, L. Moore of Wolvercote, L.
Cope of Berkeley, L. Mowbray and Stourton, L.
Courtown, E. Murton of Lindisfarne, L.
Craig of Radley, L. Naseby, L.
Craigavon, V. Neill of Bladen, L.
Cranborne, V. Noakes, B.
Crathorne, L. Northbourne, L.
Crickhowell, L. Northbrook, L.
Cuckney, L. Northesk, E.
Cumberlege, B. Norton of Louth, L.
Denham, L. O'Cathain, B.
Dixon-Smith, L. Oppenheim-Barnes, B.
Dundee, E. Palumbo, L.
Eccles of Moulton, B. Park of Monmouth, B.
Eden of Winton, L. Patten, L.
Elles, B. Pearson of Rannoch, L.
Elliott of Morpeth, L. Perry of Walton, L.
Elton, L. Peyton of Yeovil, L.
Enroll, E. Pilkington of Oxenford, L.
Feldman, L. Platt of Writtle, B.
Fitt, L. Plumb, L.
Fookes, B. Plummer of St. Marylebone, L.
Freeman, L. Powell of Bayswater, L.
Gardner of Parkes, B. Quinton, L.
Geddes, L. Rawlings, B.
Glentoran, L. Rawlinson of Ewell, L.
Goschen, V. Reay, L.
Gray of Contin, L. Rees, L.
Greenway, L. Rees-Mogg, L.
Hanham, B. Renton, L.
Haslam, L. Roberts of Conwy, L.
Hayhoe, L. Sainsbury of Preston Candover, L.
Henley, L. [Teller]
Higgins, L. Sanderson of Bowden, L.
Hodgson of Astley Abbotts, L. Seccombe, B.
Selborne, E. Tenby, V.
Selkirk of Douglas, L. Thatcher, B.
Sharples, B. Trefgarne, L.
Shaw of Northstead, L. Trumpington, B.
Vivian, L.
Simon of Glaisdale, L. Walker of Worcester, L.
Slim, v. Warnock, B.
Soulsby of Swaffham Prior, L. Weatherill, L.
Stewartby, L. Willoughby de Broke, L.
Strange, B. Wolfson, L.
Strathclyde, L. Young, B.
Acton, L. Haskel, L.
Addington, L. Haskins, L.
Ahmed, L. Hayman, B.
Alli, L. Hilton of Eggardon, B.
Amos, B. Hogg of Cumbernauld, L.
Andrews, B. Hollis of Heigham, B.
Archer of Sandwell, L. Hooson, L.
Ashley of Stoke, L. Howells of St. Davids, B.
Ashton of Upholland, B. Hughes of Woodside, L.
Bach, L. Hunt of Kings Heath, L.
Barker, B. Irvine of Lairg, L.(Lord Chancellor)
Barnett, L.
Bassam of Brighton, L. Jacobs, L.
Berkeley, L. Janner of Braunstone, L.
Bernstein of Craigweil, L. Jay of Paddington, B. (Lord Privy Seal)
Billingham, B.
Blackstone, B. Jeger, B.
Borrie, L. Jenkins of Putney, L.
Bradshaw, L. King of West Bromwich, L.
Bragg, L. Layard, L.
Bristol, Bp. Lea of Crondall, L.
Brooke of Alverthorpe, L. Lipsey, L.
Bruce of Donington, L. Lockwood, B.
Burlison, L. Lofthouse of Pontefract, L.
Carter, L. [Teller] Longford, E.
Chandos, V. McCarthy, L.
Clarke of Hampstead, L. McIntosh of Haringey, L. [Teller]
Clement-Jones, L.
Clinton-Davis, L. McIntosh of Hudnall, B.
Cocks of Hartcliffe, L. MacKenzie of Culkein, L.
Cohen of Pimlico, B. Mackenzie of Framwellgate, L.
David, B. McNally, L.
Davies of Coity, L. Maddock, B.
Davies of Oldham, L. Mallalieu, B.
Dean of Thornton-le-Fylde, B. Massey of Darwen, B.
Desai, L. Merlyn-Rees, L.
Dholakia, L. Methuen, L.
Dixon, L. Miller of Chilthorne Domer, B.
Dubs, L. Mishcon, L.
Ezra, L. Mitchell, L.
Falconer of Thoroton, L. Molloy, L.
Falkland, V. Morgan, L.
Farrington of Ribbleton, B. Morris of Castle Morris, L.
Faulkner of Worcester, L. Morris of Manchester, L.
Filkin, L. Newby, L.
Fyfe of Fairfield, L. Nicol, B.
Gale, B. Northover, B.
Gibson of Market Rasen, B. Oakeshott of Seagrove Bay, L.
Gladwin of Clee, L. Peston, L.
Goldsmith, L. Phillips of Sudbury, L.
Gordon of Strathblane, L. Plant of Highfield, L.
Goudie, B. Ponsonby of Shulbrede, L.
Gould of Potternewton, B. Prys-Davies, L.
Grabiner, L. Ramsay of Cartvale, B.
Graham of Edmonton, L. Randall of St. Budeaux, L.
Greaves, L. Redesdale, L.
Grenfell, L. Rendell of Babergh, B.
Hamwee, B. Rennard, L.
Hardy of Wath, L. Richardson of Calow, B.
Harris of Greenwich, L. Rodgers of Quarry Bank, L.
Harris of Haringey, L. Roll of Ipsden, L.
Harrison, L. Roper, L.
Russell, E. Thomson of Monifieth, L.
Sainsbury of Turville, L. Thornton, B.
Sandberg, L. Tomlinson, L.
Sawyer, L. Tope, L.
Scotland of Asthal, B. Tordoff, L.
Scott of Needham Market, B. Tumberg, L.
Sewel, L. Uddin, B.
Sharman, L. Varley, L.
Sharp of Guildford, B. Wallace of Saltaire, L.
Shepherd, L. Walmsley, B.
Shore of Stepney, L. Warner, L.
Shutt of Greetland, L. Warwick of Undercliffe, B.
Simon, V. Watson of Richmond, L.
Simon of Highbury, L. Wedderburn of Charlton, L.
Smith of Clifton, L. Whitaker, B.
Smith of Leigh, L. Whitty, L.
Steel of Aikwood, L. Wigoder, L.
Stone of Blackheath, L. Wilkins, B.
Strabolgi, L. Williams of Crosby, B.
Symons of Vernham Dean, B. Williams of Elvel, L.
Taverne, L. Williams of Mostyn, L.
Taylor of Blackburn, L. Winston, L.
Thomas of Walliswood, B. Woolmer of Leeds, L.

Resolved in the negative, and amendment disagreed to accordingly.

4.23 p.m.

Lord Mackay of Ardbrecknish moved Amendment No. 5: After Clause 69, insert the following new clause—

    1. cc1131-88
    2. Tax relief on political donations. 28,396 words, 2 divisions