Press Notice 11, Session 2007-08

19 December 2007

PUBLICATION OF REPORT: PROPRIETY AND PEERAGES

PASC CALLS FOR COMPREHENSIVE REFORMS IN WAKE OF CASH FOR PEERAGES INQUIRY

Take party patronage out of appointments to House of Lords, says Committee

Political leaders should no longer have the final say over the membership of the House of Lords, says the Public Administration Select Committee in its report following the “cash for honours” investigation.

The report is the culmination of the Committee’s inquiry into questions of propriety in the system for awarding peerages. The inquiry, temporarily suspended during the Metropolitan Police investigation, looked not just at what happened, but also what might be done to restore public confidence. The Committee concludes that an “immediate and proper response” is needed from the Prime Minister.

The Committee is critical of the Political Parties, Elections and Referendums Act 2000 - which created a loophole in the law allowing “commercial” loans not to be declared without defining what “commercial” terms might be - but is also critical of political parties, arguing that “having designed the loophole, parties did not have to dive through it so assiduously”.

The report concludes that “a deliberate attempt was made to stretch the loophole on commercial loans as far as it would go. Having agreed legislation to make party funding transparent, parties appear to have gone to some lengths to get around it. The letter of the law may not have been broken, but the spirit of the law was quite clear.”

The Committee sets out a comprehensive package of measures to restore faith in public life. This would include:

  • immediate changes to create a transparent, merit-based approach to appointments to the House of Lords;

  • breaking the link between the honours system and seats in Parliament - the report argues that “a peerage is much more than an honour, not a prize but a duty. A seat in either House of Parliament should be sought for one reason only-to serve the people”;

  • reform of party funding arrangements;

  • refocusing the Electoral Commission to make it a more effective regulator of donations; and

  • a new law on corruption in public life - the Committee notes that “the last Corruption Act was in 1916-a modern law is overdue”.

The Committee concludes that the most urgent need is for reform of the House of Lords. These reforms do not prejudge whether there will one day be a partly or fully elected second chamber. The Committee concludes that reform cannot wait.

The report calls for all appointments to the House of Lords to be made by the independent House of Lords Appointments Commission (HoLAC), based on explicit criteria for membership. While parties would still have a role in making nominations, the independent Commission - which should be set up in statute - would have the final say. This would deal with what the Committee describes as the “fundamental concern” of patronage, which has already been tackled in relation to the honours system by recent reforms.

A mechanism is also needed for peers to resign from the House, the MPs say-“or, in some circumstances, to be compelled to leave.” At present, peers cannot resign or be removed from the House except by voluntarily going on “leave of absence”, from which they can return at any time. The report notes that realistically there will always be some cases of misconduct, and in that circumstance  “it seems unduly complacent to expect that person to police themselves.”

The MPs call on the Government to take swift heed of the report. Although the best way to achieve these reforms is through new laws, they say, important changes in appointments to the House of Lords could, and should, be made immediately.

Committee Chairman Tony Wright said:

“Allegations were made that went to the heart of our political system. Those allegations deserved to be taken seriously. The fact that no charges were brought has not diminished the damage that has been done to trust in public life. We want to rule out even the possibility that individuals could buy a seat in our Parliament.

“We need to be sure that the people who sit in the House of Lords sit there on merit. That means that we need to set out what qualifies someone to be a member of the second chamber. The fact is that people do not trust parties to appoint their own members to the Lords on merit, and do not believe there is no connection between donations that are made and peerages that are received. The final judgement of whether someone is suitable must be made by a body that is clearly independent of the government and of political parties.

“Whatever view is taken of the future composition of the House of Lords, the task is to restore public confidence now. That is what our proposals are designed to achieve.”

Copies of the Report can be obtained from TSO outlets and from the Parliamentary Bookshop, 12 Bridge Street, Parliament Square, London SW1A 2JX (020 7219 3890) by quoting the appropriate HC number.  The text of the Report will also be available via the Committee’s internet homepage: www.parliament.uk/pasc the day of publication.

FURTHER INFORMATION:

Committee Membership: Tony Wright (Chairman) (Lab) (Cannock Chase), Mr David Burrowes (Con) (Enfield, Southgate), Paul Flynn (Lab) (Newport West), David Heyes (Lab) (Ashton under Lyne), Kelvin Hopkins (Lab) (Luton North), Mr Ian Liddell-Grainger (Con) (Bridgewater), Julie Morgan (Lab) (Cardiff North), Mr Gordon Prentice (Lab) (Pendle), Paul Rowen (Lib Dem) (Rochdale), Mr Charles Walker (Con) (Broxbourne), Jenny Willott (Lib Dem) (Cardiff Central)

Media Enquiries: Jessica Bridges-Palmer, 020 72190724, [email protected]

Specific Committee Information: Email: [email protected] Tel: 020 7219 6287

Committee Website: www.parliament.uk/pasc

Watch committees and parliamentary debates online:  www.parliamentlive.tv