Heath, Younger-Ross and Howarth on Parliamentary Standards (Constitutional Reform)

• [Feb02]: David Heath (Somerton & Frome, Liberal Democrat): 'I BEG to move, That this House . . recognises the need for urgent action to restore the trust of the British public in Parliament as an institution and in politics as a profession.'

I beg to move: That this House believes that the United Kingdom needs and deserves a Parliament that is fit for purpose and free from the taint of partial interests; is dismayed by the slow pace of reform which has failed to deal effectively with the opportunities for abuse; welcomes the suggestions from Liberal Democrat members of the House of Lords to introduce powers to suspend and expel Members of that House, require Peers to declare any interest in all legislation, make all Members of that House resident in the United Kingdom for tax purposes, put the Lords Appointments Commission on a statutory basis, bring Members of both Houses into the remit of the Parliamentary Commissioner for Standards, and tighten up on the issuing of passes to Parliament; believes however that there is now an urgent need to bring forward plans for an elected House as agreed by a majority of hon. Members; is concerned at the lack of progress on the Prime Minister's constitutional renewal programme; is disappointed that current legislation fails to provide for limits on donations or spending by political parties; calls for urgent and effective action to reduce parties' dependence on large donors and trade union interests; believes that comprehensive reform of the procedures of the House is essential to enable it to scrutinise Government and the spending of taxpayers' money more effectively; and recognises the need for urgent action to restore the trust of the British public in Parliament as an institution and in politics as a profession.

The past fortnight has been a bad couple of weeks for parliamentary politics. We had the aborted attempt to exempt Parliament from the Freedom of Information Act 2000, the revelations about the activities of certain peers and a reminder, in the Standards and Privileges Committee's report, of the actions of one hon. Member. A week ago, when we discussed the freedom of information provisions, perhaps in a genuflection to Burns, I asked colleagues to try to see themselves as others see us. I despair at what those outside the House who are struggling to keep their jobs and to keep a roof over their heads think when they read in their newspapers of people asking for £10,000, £20,000 or up to £100,000 to affect legislation by the exercise of whatever influence they believe they have. This cannot go on, and it is time that we took action.

A sensible, appropriate and proportionate response is to recognise that Parliament is in urgent need of reform. I refer to Parliament as a whole, as the matter is not simply about those at the other end of the corridor. The title of the motion, as it was read out by the Leader of the House at business questions on Thursday-I am sorry not to see her in her place-referred to this as an "urgent" case. When I took that title to the Table Office, its staff told me that they were unhealthy- [Interruption.] I mean unhappy-they might be unhealthy, too. They said that they were unhappy with the term "urgent" and that it was not a parliamentary term. What could better illustrate the difficulties of reforming this place?

I hope that we can conduct today's debate in a non-partisan way, because it is desperately important that we do so.

Andrew MacKinlay (Thurrock, Labour): But?

• David Heath: No, there is no "but". It is unwise for us to try to score political points off one another on these issues, and it is dangerous for anybody to claim moral superiority. I simply say to the whole House that those who are tempted to throw rocks either down the corridor or at other parties in this House should realise that we all inhabit an exquisite, Victorian, neo-Gothic house of glass. Every time we cast aspersions on other politicians, those aspersions are applied to us in our constituencies, however inappropriately. It is public perception that is important.

William Cash (Stone, Conservative): Will the hon. Gentleman deal also with the question of constitutional reform, which is implicit in the motion? The issues of standards and conduct to which he refers are matched by, if not less than, the problem of whether this is becoming a sham Parliament.

• David Heath: There are all sorts of constitutional issues, and the hon. Gentleman has a particular viewpoint on one of them. The perception outside is that politics is not being conducted in the way that it should be, and that we in this House and in the body politic generally are not clearly free from the taint of partiality that affects all of us. That is very dangerous, but more than that there is a perception that our political structures are not fit for purpose or serving the country well. That is where the thrust for constitutional reform comes from.

I turn first to the other end of the corridor and to another place-the Lords. There was palpable relief that for once, the reports over the past week were about things down that end, not here. That is a wrong-headed relief, because when there is damage to the reputation of politics, it affects all of us. The reputations of all of us are at stake. If the other House does not operate with credibility, it cannot properly perform the role that it is required to perform in our constitutional arrangements.

We therefore need to be concerned, as I know are many hon. Members, and noble Members in the other place who are honourable in their intent, about sorting matters out. Are there not inherent problems, however, with this mish-mash or half-reform that we have left in the other place? We still have 92 hereditaries who are there by accident of birth-never mind the pretend elections among that exclusive franchise. Uniquely among all Parliaments, we have people who are there-

Gordon Prentice (Pendle, Labour): There is Tonga.

• David Heath: The hon. Gentleman refers to Tonga, but there has been reform there, I think, so we are unique.

We have the 26 bishops as well, and 625 life peers. Those life peers are all placed there by-let us make no mistake about this-patronage. They are placed there because somebody has suggested they would be an ornament to that House. Indeed, some are; some are very able people who work very hard for this country. There are others, however, who, frankly, do not, and I afraid that my respect does not extend to every Member of the other place.

Chris Ruane (Vale of Clwyd, Labour): Name them.

• David Heath: I am not going to name them, because as I have said, I am not going to be partisan, but let us say for a start that it is reported that at least eight were allegedly prepared to change the law for cash in their hands. To me, as to many peers, that is outrageous. Furthermore, however, we have as Members of the House of Lords a convicted perjurer, a convicted fraudster and a convicted fire raiser. What a rum crew we have making laws for this country. We also have four peers who do not choose to be resident in the United Kingdom for tax purposes. They do not choose to pay the taxes that the rest of us pay, but they choose to make the laws that the rest of us have to live with. Two of them made solemn pledges that they would become resident for tax purposes-pledges which, since they have been elevated, they have chosen to ignore.

Philip Davies (Shipley, Conservative): The hon. Gentleman and his party make a big play of the fact that everybody who makes laws in this country should pay taxes in this country. That is a principle I can support, but can he tell me whether that extends to European Commissioners and Members of the European Parliament, who make 80 per cent. of the laws of this country, but who, as far as I am aware, do not pay any taxes in this country?

• David Heath: As a matter of fact, they do pay taxes in this country. [Interruption.] No, not those who represent other countries, of course; oddly enough, they do not, but those who are resident in this country, as our MEPs are required to be, are paying taxes in this country.

Bob Spink (Castle Point, Independent): Leaving Europe aside-[Hon. Members: "Hooray!"]-I agree with the thrust of the hon. Gentleman's speech so far, but does he agree that the law should be obeyed not only to the letter, but in its spirit? One of the tax exiles in the other place is funding campaigning in marginal constituencies to the tune of tens of thousands of pounds, to get a political advantage in a way that the public would perceive as totally wrong. What does the hon. Gentleman think about that?

Philip Davies (Shipley, Conservative): When did you start complaining about that, Bob?

Alan Haselhurst (Deputy Speaker): Order. I am beginning to have some forebodings about the way this debate is going. I should remind hon. Members that we must be very careful about criticising particular people, and if they are only allegations or suggestions, that is quite out of order. Only factual matters can be referred to on the Floor of the House. I think the House will do itself a service in the country if we are seen to conduct this debate in a sober and serious way, rather than in the rollicking manner in which it has been conducted so far.

• David Heath: I agree, Mr. Deputy Speaker, which is why I was very careful not to cast aspersions on any particular peer. I was simply making the point that all the people to whom I referred are noble Members-they are all people who are taking part in the making of the laws of this country. I think there is more than an argument that reform in this area is overdue.

Gordon Prentice (Pendle, Labour): Lord Laidlaw is a self-confessed tax exile and he gave more than £100,000 to the Conservative party last year. Is it not inappropriate for any political party to accept donations from someone who is a self-confessed tax exile?

• David Heath: I believe the hon. Gentleman is absolutely correct in saying that the gentleman in question has made no secret of the fact that he lives outside this country-he lives in Monaco, as I understand it-so I do not think we are in a contentious area there.

As I shall explain, this problem can be cured by proposals that have been made, and which I hope the Government will now accept. That is the point of this section of my speech: there are some immediate steps that can be taken-my noble Friends in the other place have suggested them-and the Government would do well to agree to them. Indeed, there are intimations that they have agreed to them. The Lord Chancellor was a very busy man over the weekend, writing columns in various newspapers saying he was minded to do this, that and the other. I rather hoped he might come to the House today when there was a debate on the subject and tell us what he proposed to do. Instead, however, he chose to send the Deputy Leader of the House of Commons, Chris Bryant-

Andrew MacKinlay (Thurrock, Labour): Unpaid.

• David Heath: Yes, unpaid. I mean no disrespect to the hon. Member for Rhondda, but I feel that the Lord Chancellor and the Leader of the House might have chosen to be here, because they seem to have a lot of opinions on this subject, and they are hinting them to the press but not expressing them to the House.

What do we believe should happen? The following proposals have come from my noble Friend Lord McNally, and some of them are already before the other place as legislative proposals. One of them is that there should be the power to expel and suspend. It is extraordinary that that was discussed 10 years ago and still has not been brought into force. Another is that the House of Lords Appointments Commission should be on a statutory basis. That would cure the problem of peers making pledges to the Appointments Commission but then not honouring them. Both those proposals are contained in a Bill introduced by my noble Friend Lord Steel.

It has been suggested that all peers, and indeed all Members of Parliament, including MEPs-let us cover the points made by Philip Davies-should automatically be considered resident in the United Kingdom for tax purposes. That could be done at the stroke of a pen. My noble Friend Lord Oakeshott has proposed that, and it can be done now. Will the Government agree tonight to do that?

There is also the view that peers should be brought under the supervision of the Parliamentary Commissioner for Standards. We have improved self-regulation in this House; it is not perfect, but it is better, and one of the reasons for that is the existence of the Parliamentary Commissioner for Standards. It is extraordinary that self-policing is considered to be a sufficiency elsewhere, and I believe that all Members of Parliament should be brought within the remit of the Parliamentary Commissioner for Standards.

The issue of passes is a security issue, apart from anything else. Passes are issued to Members of Parliament for members of staff to do work in the House, not for any passing lobbyist who happens to want easy access to the parliamentary estate. There should clearly be a tightening up of the issuing of parliamentary passes.

Lastly on my short shopping list for the House of Lords, there should be a declaration of interest irrespective of whether somebody is directly contributing to a debate. Some peers clearly seem to imagine that provided they do not actually make a speech it is all right to go along to Ministers' or civil servants' offices and argue the case for a change in legislation, which they are being paid to do, and that in some way that is not paid advocacy. The proposal seems very simple to me and the Government could usefully adopt it.

Andrew MacKinlay (Thurrock, Labour): Surely if people declare an interest it should ipso facto disqualify them from speaking about the matter in question and voting on it. There seems to be a culture in the other place that if someone makes a declaration of interest, they can proceed to speak about it, articulate it and advocate it, but in my view it should be a disqualification.

• David Heath: The hon. Gentleman is right-it is a cultural thing, although I hesitate to say that we always get it right in this House. We have to be much more careful.

I have set out a short shopping list, and if the Deputy Leader of the House is listening he could usefully say in his response tonight that he agrees to it and that those reforms will be undertaken, either through the legislation already proposed by my noble Friends, or through Government legislation if he prefers; but also that something will be in place in weeks rather years. However, to do that will be but to apply an elastoplast to the latest wound. There comes a point when we have applied so many elastoplasts that we tend to look a little ridiculous, which is the thrust of my argument. We have gone past the point when we can simply apply sticking plaster-we need fundamental reform to make our democratic structures fit for purpose. They are transparently not fit for purpose at present. We need fundamental reform.

There has never been a better time. Because of what we have heard over recent months and years, many people-not just commentators, but anyone who thinks seriously about the issue-think it is time to put this House, the other House and our parliamentary structures in order.

David Borrow (South Ribble, Labour): On declaration of interest, does the hon. Gentleman agree that there should be rules about the level of outside interests that parliamentarians, whether of this or the other place, should be allowed while still maintaining their role as a Member?

• David Heath: My personal opinion is that it is extremely difficult to have an outside job and do the job of Member of Parliament. Other may be much better at juggling their time than I am, but as far as I am concerned being a Member of Parliament is a full-time job-and a lot of Members feel that way, too. It will be interesting to see whether the Leader of the House, who is not here today, will bring forward proposals, as she intimated last Thursday, to put into effect exactly what the hon. Gentleman said.

There are three possible reasons why the Government have been so weak in introducing reforms, and all three may indeed play a part. First, the Government do not believe that there is a public appetite for reform; they believe that somehow these are Hampstead liberal or socialist arguments and that people are not interested in them because they are not the real world. The Government are completely wrong; we cannot achieve what we want to do in putting right what is wrong in this country without democratic structures that support and enable reform. There is a public appetite for cleansing the stables.

Secondly, the Government have friends who disagree-as do all parties. We know that, although I suspect that we have less disagreement at this end of the corridor. I make no secret of the fact that we have disagreement at the other end. All parties have members who disagree-those who wish, for reasons of their own, to stick with a system that they believe to be either in the national interest or their own interest. When somebody has been appointed a peer, it is astonishing how quickly they consider that the system that appointed them must be an exceedingly good one, because it had the perspicacity to put them on to the red leather seats. However, I fundamentally disagree with that view. At some stage we have to confront the issues. We have to put the argument and let those who disagree do so and lose the argument.

Alan Beith (Berwick-upon-Tweed, Liberal Democrat): Is there not an even more bizarre version of the argument? Peers have to vote for an appointed House to protect the primacy of the elected Chamber. If the primacy of the elected Chamber depends on an unelected Chamber voting to remain unelected, there is something very odd about the argument.

• David Heath: My right hon. Friend is absolutely right, which brings me to the third reason and the core problem with the Government-timidity. The Government are afraid to put their neck out and do those things. They like to hint and suggest; they like to form all-party Committees to spend a lot of time looking at things-I have sat on two of them-but when it comes to putting legislation before Parliament and pushing it through they are not prepared to act.

John Redwood (Wokingham, Conservative): Is not another problem that the Government are afraid of proper accountability and probing? For example, they spend £37 billion on bank shares, yet none of us can ask them, "Why don't you do proper due diligence? How much are those banks going to lose? How much will they pay in bonuses?" There is no accountability and what I like about the hon. Gentleman's motion is that it says we need to scrutinise spending.

• David Heath: The right hon. Gentleman pre-empts what I was about to say. He is absolutely right.

I have been talking about Lords reform. It has been agreed by the House. It has been agreed by the cross-party Committee in broad terms. As far as I know, it has been agreed by the leadership of all three parties. It has even been agreed by thundering editorials in the broadsheets over the past week, so what on earth is the delay? Why do we have to wait for what we all agree is necessary in terms of Lords reform?

It is not good enough to concentrate only on Lords reform, however. We have to look at Commons reform as well, which is why the point made by the right hon. Gentleman is so important. We have to make this House more effective. Why on earth do we not yet have a business Committee? We waste time on inconsequential measures, but when there are really important matters before the House, such as the Report stage of a big Bill when Members want to say what they need on behalf of their constituents, they are unable to do so because of some ridiculous programme motion that does not take into account the gravity or importance of the measure.

The other point made by the right hon. Gentleman was about scrutinising Government spending. Why are we so poor at scrutinising public expenditure? The nadir for this Parliament was in November-the supplementary estimate that spent £37 billion of taxpayers' money. What happened? We had a short debate when about only 12 Members were in the Chamber. We could not table amendments or apply proper scrutiny. That is not what people send us to the House to do-allow the Government to spend eye-wateringly large amounts of money on a rubber stamp, on the nod, without proper scrutiny. That is where we need reform in this place.

Jo Swinson (East Dunbartonshire, Liberal Democrat): My hon. Friend is right to talk about the need for Commons reform, particularly to make sure that Parliament takes power back from the Executive and has the ability to scrutinise. Does he agree that we need to give power back to our constituents to scrutinise what we do, whether through transparency on expenses or giving them the right, if a certain percentage of them sign a petition, to recall their Member of Parliament and hold a by-election?

• David Heath: If we make this place properly representative, transparent and accountable, we will be giving power not to ourselves but to the people who send us here. My hon. Friend makes an absolutely crucial point.

When we have dealt with reform of the Lords and reform of the Commons, we will still have to deal with reform of the political parties. There is the issue of political party funding. I sat on that wretched Committee for so long trying to reach agreement between the parties on the issue. We should have had agreement; it was within our grasp to have proper caps on donations and on expenditure, to reduce the ridiculous arms war in election spending and put things on a sensible footing. We should not give undue influence to people who were prepared to dig deep into their pockets but who always had a price for the support that they were prepared to give.

What happened? The Conservatives will argue with this, but it is a fact: they walked out, because they did not think the proposal went far enough in terms of trade union funding and affiliation fees-not donations-although they had earlier agreed on that point. Then, those on the Government Benches were too scared to take the proposal forward without the Conservatives, so it was abandoned. What do we have instead? We have the Political Parties and Elections Bill and we have the constitutional renewal Bill, although goodness knows where that is-it is somewhere in limbo at the moment. These are mere mice of Bills; they are horrible little crawling creatures of Bills compared with what is necessary in order to sort out the body politic.

Let me end on this point. We cannot make our politics work unless people have trust in the political system, and hints at reform are no longer enough. The fact that the Prime Minister asserted when he was first appointed that he was interested in constitutional renewal will not cut any ice with anybody until we start to see delivery. The Bills before the House at the moment are not delivery. Britain needs and deserves better than this-and not just on reforming Parliament. I could go on and talk about empowering local government or about reforming the European Union to make it more democratic and transparent. Those are all important issues, but unless we start the process, our democracy will not be fit for purpose. It is demonstrably not fit for purpose at the moment and there is no better time for us to make a start. I hope that the Deputy Leader of the House, for it is he who will respond, will be able to persuade us that the Government take this matter seriously.

• . . Richard Younger-Ross (Teignbridge, Liberal Democrat): I recall listening to an interview with David Steel in the 1970s-it might have been on "Desert Island Discs". He said that being a politician should be like going into the Church; it should be one of the highest callings. That was against a background of local government corruption and of a popular belief that MPs were in it only for themselves and that they would say anything to win an election. That view was reflected in a play that I think was called "Vote, vote, vote for Joey Barton"-[Hon. Members: "Nigel Barton!"] Of course, it was Nigel Barton. Some 30 years before that, Howard Spring wrote "Fame is the Spur".

It has been said that Members of Parliament are held in high esteem in their constituencies, but that Parliament and politicians in general are held in low esteem. Since David Steel's comments, there have been problems and scandals on both sides of the House and at both ends of the building. Cheap comments from the Conservative Front Bench do not aid the debate. Sounding like a budgerigar does not take us forward.

Some of the problems in the House of Lords have been experienced in the House of Commons. We had full-time Members of Parliament and Members of Parliament who were employed in part-time work elsewhere. The latter had a night job and a day job. Members of the House of Lords still have to do that. Their Lordships are given a small allowance and most have other employment to supplement it. Some work as lobbyists.

Kelvin Hopkins (Luton North, Labour): I understand that one of our colleagues in the House of Lords accumulates some £60,000 a year by maximising his time in the House and ensuring that he is paid properly. That is roughly what we get.

• Richard Younger-Ross (Teignbridge, Liberal Democrat): That sum includes accommodation and other matters. We get money for such items in addition to our salary, so the hon. Gentleman does not compare like with like.

If we are to reform the other end of the building, we should consider making their Lordships full time. If they are to be full time, they need to be salaried. If they are to be salaried, they need to be elected on the same basis as us.

At our end of the building, it is often said that the media hold us in low esteem. They correctly pick up on corruption and instances when hon. Members have not done right. They pick especially on cases of people who appear to get away with blue murder. A former Member of Parliament-I know who it was but I shall not name him because my point is not party political-was brought before the Standards and Privileges Committee for shares for influence. That Member was found not guilty because the business that offered him shares had gone bankrupt, so he had not committed an offence. The public do not understand that.

If the public are to esteem us, we must reform the way in which we pay ourselves and deal with our expenses, but not in a hair-shirt manner, as some hon. Members would have us do sometimes for cheap political purposes. That is not just. We should also refuse to listen to those who say that they want to keep things as they are. Although, by and large, most Members of Parliament do nothing wrong in what they claim, the public do not believe it. As has often been said, justice must not only be done, but be seen to be done.

We must therefore consider a system whereby what we claim is not only clear and transparent but beyond reproach. The public do not understand Members of Parliament making profits from buying flats. In 1992, several Conservative Members, who were elected in 1987, lost money because of the condition of the housing market at the time. No one in the media said, "Oh dear! These MPs need to be recompensed for their loss." It will also not be understood if Members who were elected in 1997 and 2001 make tens of thousands of pounds on the appreciation of properties that they have bought. We should move to a system that gets away from that. It would be best if we did not pay ourselves allowances for some items. For example, the House of Commons could rent accommodation and allocate it to us in the same way as our offices are allocated. If flats were furnished, we would not need to be paid an allowance to do that. That would be clear, transparent and non-corrupt.

. . • David Howarth (Cambridge, Liberal Democrat): This debate is really about a crisis of confidence in politics. If we do nothing about that crisis, it could turn into a crisis of confidence about democracy itself. We face a conjunction of crises. The crisis in the political system is happening at the same time as a crisis in the financial and economic system that threatens people's jobs and their confidence in the future. We should take very seriously what Kelvin Hopkins said: this is a dangerous situation. Just as with the financial and economic crisis, if we do nothing about the political crisis, or just simply try to get away with the minimum, it could be disastrous. In the case of the political crisis, it could be disastrous for our democracy.

Some of the things that will have to be done about the economic situation will be unpalatable, and what is done will amount to choosing among options all of which are bad. Similarly, some of the measures that are necessary for dealing with the political crisis will be uncomfortable for many Members of the House. Old certainties will have to be discarded. Politics as normal will not be enough. Many will have to let go of ideas from the past-and jibes from the past; I look particularly at Mr. Vara when I say that-if we are to avoid being swallowed by the future.

The essence of the political crisis is that millions of our fellow citizens do not feel like citizens any more. They no longer feel that they play any role in the government of the state in which they live. They think that the only people who have access to political power are people with very large sums of money-either their own money, or that of large corporations. They feel politically excluded. It is a feeling that one comes across everywhere, including on the picket lines of places such as the Lindsey oil refinery. Decent people should not have to resort to such measures. Whether or not we agree with what they are calling for, they should be heard here. That feeling of exclusion existed well before the recent revelations about what was going on in the House of Lords. What has happened there simply confirms, in the most dramatic way, what people already believe: that power lies with money and that the only part that ordinary people play in politics is as spectators-of either a tragedy or a farce.

The Government have simply taken on the role of holding the ring between the real players-the lobbyists, the media and big money. That is why the first imperative is to get big money out of politics. There should be a strict cap on how much money one person can donate to a political party. There should be strict limits on what parties can spend at both the national and local level. No one should be able to buy an election or be seen to be buying an election. Legislators who have been bought or who do not care whether they are seen to have been bought should just be thrown out.

Tackling political exclusion goes beyond dealing with the power of lobbyists. We have to look at ourselves and what we achieve in this place. The very idea of an appointed, non-elected second Chamber-a House of patronage and of networking-is an affront to the mass of people who will never have the connections to get there. That is why we should move now, not later-not in due course-to an elected second Chamber, regardless of what that means for the status and self-regard of Members of this House.

This place needs radical reform too, not least in the form of election and how we get here-the hon. Member for Luton, North mentioned that. A form of election that means that a tiny number of electors in a tiny number of seats decides the entire general election is part of the problem of political exclusion. The political system ignores the vast majority of voters nearly all the time. We have lost everything that we had in this place that made us a Parliament-a place to which people would look for their voices to be heard.

The most important aspect is the point raised by at least three Members-the hon. Members for Nottingham, North (Mr. Allen) and for Thurrock (Andrew Mackinlay), and Mr. Meacher: we do not have the power even to set our own agenda. What we discuss here is what is served up to us every day, under Standing Order No. 14, by the Government. That must go. We must take the power back; we must talk about what the people in the country want us to talk about, and not what the Government want to talk about.

. . Question put (Standing Order No. 31 (2)), That the original words stand part of the Question. The House divided: Ayes 47, Noes 221. Question accordingly negatived.

Question put forthwith (Standing Order No. 31 (2)), That the proposed words be there added. Question agreed to. The Deputy Speaker declared the main Question, as amended, to be agreed to.