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Lord Bassam of Brighton: My Lords, perhaps my noble friend will give way; he may be right. I have not had the opportunity closely to study this section. It may well be that it made perfect sense in one case and not another. That happens from time to time.

Lord Wedderburn of Charlton: My Lords, I must press my noble friend. Can he say why, in this case, it makes sense in one paragraph and not in another? There is no sensible argument here. I have not come across anybody except the Government--I do not personalise that statement to him because I realise it is government policy to do it this way--who took that point. Nor is there anything in the question on the different structures of Ford UK and BP. For one thing, a multinational can always have an agency, place of business or subsidiary here. They are not forced to do so and do not thereby come into conflict with Articles 43 and 48.

As to the declaration or undertaking, if the directors, as my noble friend suggested, are to ensure that the law is obeyed--as we must assume they will--what is wrong with their giving an undertaking to say so? I cannot for the life of me see why publicity on that matter is not an asset to the clause; it is a public register.

I made the mistake in my first draft of the amendment of saying that perhaps the notice should be kept by the company registrar. I was persuaded in the following discussions to take it away from the company registrar because he has many other duties. Therefore it could be done in a variety of ways by the Secretary of State under the amendment.

I cannot believe that when my noble friend reads Hansard and the other documents he has in his possession setting out the argument at perhaps rather greater length than I should have done in a letter he will not look again at the possibility of tying this clause down to the point at which there is no offence against

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Article 43. If he does not do that, if there were a challenge on some aspect, it would be his responsibility. My amendments make it impossible to challenge the clause and I hope that my noble friend will look again at the matter. However, I can do nothing more this evening than to say I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 92 to 94 not moved.]

Lord Davies of Oldham: My Lords, I beg to move that the House do now adjourn during pleasure until 8.40 p.m.

Moved accordingly, and, on Question, Motion agreed to.

[The Sitting was suspended from 7.55 p.m. to 8.40 p.m.]

[Amendment No. 95 not moved.]

Lord Bassam of Brighton moved Amendment No. 96:


    Page 38, line 45, after ("at") insert ("any time within the period of five years ending with the date of").

The noble Lord said: My Lords, this is a large group of amendments but they are all on the same theme; that is, relaxing the provisions which the Bill makes in respect of donations from trusts and bequests, subject to proper conditions and any necessary restrictions. The matter was raised in Committee by way of amendments tabled by the Liberal Democrats and the Official Opposition. I then indicated that the Government were in listening and reflective mode and now the House has a response.

I shall explain as briefly as possible what the government amendments seek to do and the way in which they operate. Amendment No. 96 is concerned with an issue which was not raised in Committee although it was raised in another place at an earlier stage. It is linked to other points. The amendment would relax and limit the rules on the receipt of donations by way of bequests. It would no longer be necessary for the deceased to have been on the electoral register at the time of death--I am sure that the deceased will be most pleased to hear that! Instead, it would be sufficient if he had been on the register within five years of his death. This takes account of the possibility that a person who is nearing the end of his life and who moves residence might not get around to ensuring that he is still on the register. It is a concession that we can make without injury to the main thrust of the Bill and I imagine that it will be welcome.

I turn to the next item with trepidation because of the complexity of the subject; it is the larger group of government amendments concerned with trusts. They include trusts established by bequests. The main thrust is that we are persuaded that it would be right to make special provision for trusts which were set up in the past. It is a serious act to nullify a trust and we accept that establishing whether the person who was head of the trust was a permissible donor a century ago may be

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difficult, even impossible. I cannot imagine being able to reach back into the graves to discover what was the case.

Amendments Nos. 101 and 277--the latter is where the real meat is to be found--allow a donation from a trustee if the trust was created before a certain date. We have opted for 27th July 1999, which was when the White Paper for the Bill was published. The object behind that limitation is to ensure that we are not removing the requirements of the Bill from trusts set up after the issue fully entered the public domain conceivably as a device for getting round the funding restrictions in prospect. In any event, where a trust was set up after the qualifying date, there will be no difficulty about establishing whether or not the person who set it up was a permissible donor.

Further conditions which we believe to be proper and necessary are, first, that the trust should not have been varied since 27th July 1999 so as to benefit a party; and, secondly, that no property should have been transferred to it after that date. That is to prevent an old trust from being used as a shell for what is a new funding scheme. Amendment No. 277 also stipulates that the trustee must give the party the full name of the person who established the trust and of any people who have contributed to it. Even if we cannot insist that such people should have been permissible donors, we can ensure transparency. Without that requirement, the Government would be open to the charge, of which they are emphatically not guilty, of wanting to perpetuate blind trusts.

Before leaving the issue of old trusts, I should mention one further condition which the amendments set for the receipt of donations from trusts. It is to be found in subsection (5) of the new clause which would be inserted by Amendment No. 277. The purpose of subsection (5) is to exclude property received from a discretionary trust. Trustees inevitably enjoy discretion under a trust as to the circumstances in which payments are made. However, in order to be an exempt trust, there shall be no discretion as to the party which enjoys the benefits of the trust.

I turn to the other issues dealt with in the government amendments. The new subsection (6)(b) of Clause 53, which would be inserted into the Bill by Amendment No. 101, is to much the same effect as the existing subsection (5) and has been made clearer. However, subsection (4) of the new clause inserted by Amendment No. 277 is a substantively new provision. It allows donations to be received from new trusts as well as old ones provided it can be shown that the people who put the money in were permissible donors at that time. Again, however, the trust must be of the non-discretionary type. We have persuaded ourselves that this provision can safely be made without undermining the effect of the Bill.

I shall deal briefly with the remaining government amendments, luminous as they are, because they are all on one simple theme; that is, to adapt the reporting requirements in the Bill to take account of the kind of information which will have to be given and which can be reasonably required in respect of trusts.

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The new clause stipulates that the trustees must tell the party the names of the people who contributed to the trust and so forth. The amendments to Schedule 6 follow that through by requiring the recipient party to give the relevant information to the electoral commission.

The amendments to Schedules 7, 11, 15 and 16 are to the same effect. The new rules on trusts and bequests will apply to the other provisions of the Bill on donations to individual and member associations, third parties, participants in referendum campaigns and candidates, as well as donations to parties. The amendments to the latter schedules amend the reporting requirements in respect of those recipients in the same way as do the amendments to Schedule 6 in respect of donations to parties to take account of the new provisions on trusts and bequests.

Having explained the Government's amendments, I must also address the new clause tabled by the noble Lords, Lord McNally and Lord Rennard, in Amendment No. 102. My hope is to persuade those noble Lords and your Lordships' House that we have made a decent job in putting forward our amendments and that it is not necessary to press the alternative amendments. The Liberal Democrats' new clause is in some ways more generous and in some ways more restrictive than ours. It deals only with old trusts. It is broader in form and contains no conditions matching those which we seek to impose as to discretionary trusts or variations of an old trust. It does not explicitly require the original founders of the trust to be named. It requires the settler, if an individual, to have been domiciled in the United Kingdom. My impression is that the new clause is framed to fit the exact circumstances of particular trusts with which the Liberal Democrat Party is concerned. That is understandable but we must look at the wider picture. Therefore, I trust that noble Lords will be persuaded that the government amendments are satisfactory and accommodate their concerns.

On that assumption, this substantial group of amendments will make a significant improvement to the Bill on a consensus basis and I commend our glorious amendments to your Lordships' House. I beg to move.


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