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Lord Mackay of Ardbrecknish: My Lords, I speak to Amendment No. 150. I have no problem with the amendment of my noble friend Lord Hodgson of Astley Abbotts. It arrives at largely the same total figure.

If I explain why I have arrived at the figure of £15 million, noble Lords may understand that the Government are in some difficulty over their own internal logic. When the Bill arrived at your Lordships' House the total limit was £20 million. In Schedule 8, the list of qualifying expenses making up the £20 million was quite long; the exclusions list was somewhat shorter. In Committee, the Government took out a number of qualifying items and put them in the exclusions. I hope that I am right; I speak from memory. I think that they were largely expenses falling on the property, services and facilities of the headquarters of the national parties and on the party's ordinary remuneration allowances, payments to staff, and some other points. That must be worth some money. If it were £20 million when all those items were included, logic tells me that it should be a tinge--

Lord Bassam of Brighton: My Lords, I cannot resist asking how the noble Lord comes up with this figure. How has he managed to reduce his original figure from £20 million to £15 million? I have heard the explanation. How has he managed to cost it so precisely?

Lord Mackay of Ardbrecknish: My Lords, it is not precise. That is the point. It was not my £20 million to begin with. I remind the noble Lord that it was the Government's £20 million. When that £20 million was supposed to cover a large number of items, I was content to leave it at that. However, the Government have taken out a number of expensive items, but have left the figure at £20 million. I fully accept that my figure is a rough estimate. The accurate figure might be £14 million, £16 million or perhaps even more.

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However, the Government know why they have made the changes, so they must have some idea of how much those other items are worth. They are certainly not worthless--they are worth a considerable amount. My guesstimate is that they might be worth around £5 million to the major parties. That is why I have suggested that the limit should be £15 million rather than the £20 million that we started with.

That is my logic. If it is faulty, no doubt the Government will tell me. They are usually quick to do so. However, if it is just the numbers that are wrong, we still have Third Reading to come. If the Government do not like my approach, perhaps they prefer that of my noble friend Lord Hodgson. Even at this late hour, we should turn our minds to the consequences of the amendments that the Government tabled in Committee and how they impinge on the £20 million that we began with. Like the noble Lord, Lord Rennard, and my noble friend Lord Hodgson, I look forward to hearing the Government's explanation.

Lord McNally: My Lords, I am attracted to the American saying that when you are up to your armpits in alligators, it is sometimes difficult to remember that the idea was to drain the swamp. That certainly applies here.

I urge Ministers not to leap up with a glib rejection. This is one of those moments--they sometimes happen late at night--when the Government should grab hold of an opportunity that would have a massive impact on the Bill. As the noble Lord, Lord Hodgson, said, a large part of the motivation behind the Bill has been to drive the big money and the big donations out of our politics. As my noble friend Lord Rennard said, we now have a remarkable consensus, based on the earlier recommendations of the Labour Party and the new declared policy of the Conservative Party. We should not let that slip.

I know that the Labour Party is a lot more flush than it was in my day, but the big upper limit of £20 million, combined with a Bill that will make it very difficult to get anybody to donate large sums to political parties, could leave us in trouble. The lower we can get the cap, the healthier our politics will be and the better it will be for all political parties. I urge Ministers to grab this opportunity to strengthen the Bill immeasurably.

Lord Bassam of Brighton: My Lords, the amendments relate to limits on campaign and controlled expenditure. I shall run through the arguments and pose a few questions at the end.

The Neill committee recommended a £20 million limit on the campaign expenditure that may be incurred by a party in connection with a general election. The committee further recommended that the limit for particular parties should be based on a formula calculated on the basis of the number of seats contested by that party. That is simple and straightforward. Schedule 9, paragraph 3, contains such a formula. It provides for an allowance of £30,000 for each constituency that the party contests. That is

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a realistic sum in modern electioneering. A party that fights all 659 constituencies in the United Kingdom will have an overall limit of £19,770,000.

The noble Lords, Lords Hodgson and Mackay, now wish to reduce the £20 million limit, in round terms, by a third and a quarter respectively. I am absolutely gobsmacked. I am really taken aback by this sudden conversion to the limit lower than that proposed by the Neil committee. In Committee, the noble Lord, Lord Cope, in response to an amendment tabled very honourably by the Liberal Democrats, who throughout this debate have been entirely consistent, said:

    "It will come as no surprise to the noble Lord, Lord Rennard, that we do not support these amendments...The Government are sensible"--

this is a Conservative spokesman saying that the Government are sensible--

    "to stick to the Neil committee's recommendations in this respect".--[Official Report, 18/10/00; col. 1098.]

I believe that the House ought to be told why there has been a sudden change of heart. I suggest to your Lordships that it is rather late in the day to change course on such an important feature of this Bill. I do not suggest that the figure of £20 million is set in stone. Far from it. But it is, after all, the product of very careful deliberation by--

11.15 p.m.

Lord Mackay of Ardbrecknish: My Lords, I am interested in listening to the noble Lord, but will he address the point that certain quite large items have been taken out of one column and put into the other since my noble friend Lord Cope made his point? I would happily have stuck with £20 million if it had not been for that. That is my point. Perhaps the noble Lord will address that.

Lord Bassam of Brighton: My Lords, I shall address that point. However, let us not forget that this was an independent advisory committee. In my view, we should not try to change its recommendations without seeking further independent advice. That is an important point, particularly in view of the last remark of the noble Lord. I suggest that it would be most appropriate to take independent advice from the electoral commission, without wide consultation with the main political parties. I suggest to the House that the proper course is for us to run with the figure of £20 million for the next election and then perhaps look at the matter in the light of that experience. If there is then a new consensus in favour a lower limit, the Home Secretary can, of course, exercise his powers in Clause 152 to reduce the sum of £30,000 per constituency in order to achieve the desired result.

In view of what the noble Lord said, it is perhaps worth reminding ourselves that the amendments to Schedule 8, to which he referred, were made before the noble Lord, Lord Cope, spoke to the amendment to Schedule 9, tabled by the noble Lord, Lord Rennard. I think the noble Lord has rather gathered the point that I am about to make.

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I am not by nature a deeply suspicious person. I am not a cynic in politics. However, I am very puzzled by this late conversion to the lower figure. If the best that the noble Lords opposite can do is make the point that £15 million is the sum that we put to Neill, I am afraid that that is not terribly good. I cannot help thinking that perhaps this amendment has something to do with the fact that the Conservative Party is experiencing extreme difficulty raising funds towards the cost of the next general election. If that is not so, perhaps it has something to do with the fact that it fears handing back money, otherwise described as Short money, because it has been misused. I am very puzzled. These arguments have never been put in the past. We are running up to a general election, some months, maybe a little more than a year, away, and it is most strange that this argument to bring down the level of expenditure for the next general election should be now advanced. Is it the case that the Conservative Party fears losing the next general election and, therefore, perhaps wants to tuck away a little more for later general elections, without wasting it on William's great campaign next year or the year after? It is a very strange conversion indeed.

My earlier question to the noble Lord, Lord MacKay, about how he managed to cost so precisely the amendments to Schedule 8 is a very real question. How has he arrived at a figure of approximately £5 million? It is a very interesting figure, particularly as it appears to come so close to reducing the level to that which he obviously wants to argue in terms of our original submission to the Neil committee. I am deeply suspicious. I am not a little amused by this. However, I intend to stick to the argument of consistency. The position we have come to, properly reached, advised by Neill, is the position which we in Government wish to stick to because that is the consistent position.

The noble Lord has been arguing consistently all evening. He has made that a virtue of many of his arguments. If that is the case, I am sure that he, and the noble Lord, Lord Hodgson, will feel more than comfortable in withdrawing these very strange amendments.

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