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Lord Hodgson of Astley Abbotts: My Lords, perhaps I may ask the Minister a couple of questions related to trusts. I suspect that if I studied the Bill in great detail I could work it out for myself, but I have some difficulty in that regard. A number of constituency associations have access to and use of properties which are owned by trusts. Some of those trusts are old and obscure and the original documentation has long since disappeared. The trusts operate on an extraordinarily unconnected basis, but the trustees continue to reappoint themselves and keep them going. Some of those buildings have outlived their usefulness and may be in a poor state of repair and require substantial expenditure to bring them up to date; or, because they were built 100 years ago, they may be in the wrong part of town in relation to where people now live.

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Some of these trusts will be wound up, the property realised and the proceeds made available to the local association or the party nationally. It is not clear to me whether in those circumstances that is a permissible donation to an association or the party nationally, given that the original purposes of the trust may be unclear because the documentation has been lost. I should be grateful for the Minister's comments.

Lord Rennard: My Lords, I thank the Minister for his careful consideration of the issues connected with trusts which I raised in Committee. In particular, I welcome Amendment No. 101 and subsequent amendments which allow donations to be made by trusts. Perhaps some of these trusts were created a long time ago when people wanted to give money either during their lives or as bequests to political parties. I argued in Committee that their intentions should be respected, and I thank the Government for doing so. However, all trust deeds are not the same, and often they are legally very complicated. Clearly, trusts made in the early part of the century were not written with the Political Parties, Elections and Referendums Bill 2000 in mind, and I ask the Government to consider further these points. I shall not move Amendment No. 102.

Viscount Astor: My Lords, I generally welcome the amendments spoken to by the Minister. I believe that the most important one is Amendment No. 277 which concerns trusts. Quite rightly, he pointed out that subsection (5) provides that a donation received from a trustee in pursuance of any discretion is not exempt. That appears to be a strong power. Discretion can arise at various levels. One can easily have a trust which says that the income must be paid to the Labour Party, the Fabian Society or whatever, but the trustees have the power to pay capital if they wish. Surely, in those circumstances the trustees would have a degree of discretion, but the provision is written in such a way that not only would they be unable to exercise that discretion but they would not be able to use the money for the purposes of the trust. This is perhaps quite a severe restriction.

It is probable that when a trust is drawn up the trustees need discretion. The trust may have been drawn up somewhere by the Conservative and Unionist Party, and the trustees must interpret what it means. Parties change their names, and the Liberal Party changes its name more than most. I believe that a provision which absolutely disbars any trust donation where the trustee has any discretion goes too far. Provided that the trustee exercises the discretion in a reasonable manner under the trust deed, surely it should be an acceptable donation.

Lord Bassam of Brighton: My Lords, I deal first with the point raised by the noble Viscount, Lord Astor. The noble Viscount makes a reasonable point. I suggest that he studies carefully my speech in Hansard. The limits on the discretion relate to the beneficiary. All trust deeds necessarily have discretion as to the amount and date of payment. The language used in the

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Bill is that used in finance legislation to identify discretionary trusts. If that does not fit the circumstances which the noble Viscount has in mind, clearly we need to give the matter further thought and perhaps advise him further. However, the noble Viscount needs to study Hansard to see our thinking on this matter. There has already been a good deal of discussion between party officials and Home Office officials. We thought that we had come up with a workable scheme, and that was why we designed it in this way. We do not want confrontation but seek to be helpful.

In reply to the noble Lord, Lord Hodgson, I am sure the noble Lord appreciates that it is difficult to answer his point without knowing the full details. This is not a lawyers' consultation; if it was, the noble Lord would be talking to the wrong person. I suggest that the noble Lord studies Hansard. If the trust is for the benefit of members of an unincorporated association--the local constituency party--they can make a gift if that unincorporated association is a permissible donor. That seems to be a first principle, but we need to look at it in more detail. I ask the noble Lord to think carefully about what I said in moving the amendment.

In response to the noble Lord, Lord Rennard, I repeat that we seek to work with the noble Lord's party to solve a common problem, and we believe that in most instances we have achieved that. If the noble Lord wants to make further representations to the Government's lawyers, he should do so. We believe that we have provided something that would work for the Liberal Democrats, noble Lords opposite and my own party. I do not believe that my party would be particularly affected by trusts in the same way as the Liberal Democrats and the Conservatives. The amendments are before the House and I hope that noble Lords will give them their blessing.

On Question, amendment agreed to.

Lord Mackay of Ardbrecknish moved Amendment No. 97:

    Page 39, line 7, leave out ("not less") and insert ("more").

The noble Lord said: My Lords, in moving Amendment No. 97 I should like to speak to a fairly formidable list of related amendments that go to the same point which, if it is not addressed, will cause continuing irritation to all political parties and donors. Essentially, I argued in Committee that it would be far easier and more sensible if the limits were set at more than £200 and more than £5,000. That would, I believe, be hassle-free and better than the current provision which contains limits of less than £200 and less than £5,000. The point raised in Committee--it has not changed since--was that one would get into the annoying situation found in supermarkets where items are marked at £9.99, £99.99 and so on. Someone who wants to write a cheque to the Labour Party but does not want to be asked to disclose it will make it out for £4,999.99. I believe that he or she will find that irritating. It is much simpler to take the nice round figure of £5,000 and provide that anything above that sum is declarable; similarly, with the limit of £200.

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The noble Lord, Lord Bach, said that he could not promise anything but he would take the matter away and look at it again. I trust that he has done so. If I were a government Minister I would be saying at this point that these were minor consequential and drafting amendments. I suggest that your Lordships accept these amendments. I beg to move.

Lord Goodhart: My Lords, I rise to support the noble Lord, Lord Mackay of Ardbrecknish. The amendment seems to me to be a matter of common sense. It is ridiculous to have £4,999--what I might call the Marks & Spencer kind of figure. The amendment is entirely in line with the Neill committee's thinking. We did not actually consider this point, but had it been drawn to our attention I am sure that we would have said, "Yes, let us draw the line at £5,000. Anything more than £5,000 is reportable. If it is exactly £5,000 then it is not".

9 p.m.

Lord Hodgson of Astley Abbotts: My Lords, I rise to support my noble friend's amendment. I speak as someone who has been a volunteer political activist. Those people will struggle with the weight of the regulations that will hit them with the Bill.

We should be striving for two things: first, intelligibility and clarity; and, secondly, to use wherever possible everyday speech. People do not say "not less than", they say "more". The noble Lord, Lord Bassam, has consistently argued that he is trying to have a light touch wherever possible. This is a good place to have a light touch.

Lord Bach: My Lords, of all the serious matters that have concerned the House on the Bill, this is the one--I am lifting the veil slightly on the workings of government--that has caused us the most problems. I come to the Despatch Box some weeks after our earlier debate--I am glad of the interval that have had between-times--in order to tell your Lordships that, while we are not entirely persuaded by the arguments that have been so well made on this issue, both on the previous occasion and tonight, it appears that the noble Lord, Lord Mackay, on this issue at least, has some support from other Members of the House and perhaps even outside it. Therefore, as an act of unparalleled generosity, the Government are prepared to accept the amendments in the noble Lord's name wherever they appear in the Bill.

However, there is something which concerns us. Our researches show that there are 16 other occasions in the Bill where the noble Lord has not, as yet, moved an amendment to this effect. So far as concerns this issue, there are possibly two interpretations: first, that there is some subtle difference between the amendments here and the amendments that have not so far been tabled; or, secondly--which is much more unlikely--that the noble Lord and his researchers have missed them. In any event, I can tell him that not only will we accept these amendments but we shall, as government, table the other 16 or so before the House at Third Reading.

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But we shall only do so as part of a deal. That deal is that the noble Lord does not complain about further government amendments at Third Reading.

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