Political Parties: Donations (Hansard, 5 November 2003)

§ The Parliamentary Under-Secretary of State, Department for Constitutional Affairs (Lord Filkin)
My Lords, the Political Parties, Elections and Referendums Act 2000 established that donations must be from a permissible source and must be declared. That promotes openness and transparency in the financial affairs of political parties and is four-square with the recommendations of the Neill committee. The Electoral Commission is currently undertaking a review of all aspects of party funding. We shall consider its recommendations following publication.

§ Lord Campbell-Savours
My Lords, my noble friend will know that if a trade union leader were to seek to manipulate Parliament by telling the Labour Party to ditch its leader, there would be an outcry in the country from the general public and cries of "disgrace" and 796 "abuse of power". In that light, and that being the case, why is it permissible for Mr Stuart Wheeler, a well heeled businessman, to seek to manipulate Parliament and the House of Commons by demanding that the Conservative Party ditch its leader, Iain Duncan Smith, as happened last week? Surely that is an abuse of power. Indeed, some would say that it borders on corruption of the whole political system.

§ Lord Filkin
My Lords, the Government have no particular view on that issue; it is a matter for the Conservative Party. I mark only that the fact that we passed the 2000 Act makes it clear and publicly apparent that these issues are in the public domain, and that is surely right.

§ Lord Marsh
My Lords, does the noble Lord agree that it would be good, in the public interest, to make it clear that trade union leaders will be given the powers to get rid of the Prime Minister?

§ Lord Filkin
My Lords, I missed the last crucial words of the question.

§ Lord Marsh
My Lords, I suggested that the easy way to overcome the problem would be to give trade union officials similar powers and, indeed, encouragement if they wished to remove the Prime Minister.

§ Lord Filkin
My Lords, that is what I can describe only as an interesting suggestion, but I am not sure that it would find universal favour with the Government. The House will be well aware that trade unions, many of which support the Labour Party, do not always get what they wish from the Government.

§ Baroness Knight of Collingtree
My Lords, will the noble Lord always bear in mind that it is a basic freedom in this country that every individual has a right to back any political party and that questioning a person's right to give money to that political party is a dangerous road to tread?

§ Lord Filkin
My Lords, I believe that in many respects that argumentation led the Neill committee to conclude in its report that there was no need to put a cap on political donations; nor did it recommend state funding for political parties. The committee saw that participation by individuals in political processes, including the making of donations, was open to all citizens if they wished to do so.

§ Lord Goodhart
My Lords, I speak as a former member of the Neill committee. Do the Government feel that the time has come to deal with the abuse mentioned by the noble Lord, Lord Campbell-Savours, by putting a limit on the amount that any one person—whether an individual, a corporation or a body such as a trade union—can contribute to political parties? Do they also feel that, by contrast, they should 797 encourage the making of small donations to political parties via a means such as Gift Aid on donations of up to, say, £500?

§ Lord Filkin
My Lords, as the noble Lord, Lord Goodhart, knows better than most, this is an extremely well tilled field. No fewer than six studies have been carried out into party political funding over the past 25 years. The noble Lord is well aware of our position to date. At this stage, the most helpful comment I can make is that we shall await with interest the recommendations of the Electoral Commission on these issues next summer and shall then consider whether there is merit in them.

§ Lord Saatchi
My Lords, I have just heard the first move by the Government towards total state control of party funding. Would it not be better, as my noble friend said, to leave it to individuals to decide whether they want to support a political party? After all, is it not true that even someone who simply pays to become a member of a political party expects to gain some influence, even if only by going along to a party meeting and talking to his MP? Would it not be a great pity if the Government regulated the individual donor out of existence, leaving only the possibility of complete state control of party funding, which our Benches would totally oppose?

§ Lord Filkin
My Lords, the noble Lord is right. It might well be a pity if I had implied on behalf of the Government that we had any intention whatever of doing anything that he suggested. However, that is not our position. Our position is that individuals are free to make political donations to parties of their choice; that there is no cap on the size of those donations; and that the issue of sizeable donations should be in the public domain. Political parties no doubt look to their own control mechanisms over such issues.

§ Lord McNally
My Lords, just for the record, is the Minister aware that the Conservative Party already takes more than £3 million in state funding? Clearly it believes in being just a little honest.

§ Lord Filkin
My Lords, I believe it is good to try to avoid being excessively party political on many of these occasions. However, I am aware that all political parties receive state funding from a variety of sources: Short money; Cranborne money; and policy-development grants—the most recent initiative and a very useful source, with £2 million being distributed between the parties—in addition to the funding that national parties receive in support of national election campaigns. I do not believe that most people feel that the current system is fundamentally broken; it is a mixed system.