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«The Transparency of Lobbying, Non Party Campaigning and Trade Union Administration Bill House of Commons Second Reading Tuesday 3 September 2013 On ...»

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 a website includes a blog which comments on the activities and views of politicians from various parties in the run-up to the election. Some politicians believe the blog is biased against them or their party. Will the cost of producing the blog, and a proportion of the cost of maintaining and promoting the website and associated social media activity, count as ‘for election purposes’? Our current view is that it is doubtful that the blog’s website is covered by the PPERA exemption from the non-party rules for “the publication of any matter relating to an election, other than an advertisement, in a newspaper or periodical”.

14. The uncertainty created by the Bill seems likely to affect a wide range of organisations. Small campaign organisations with a local or regional focus that are not currently affected by the rules on non-party campaigning will face significant new regulatory burdens, even if spending only a few hundred pounds a month over the year before the election on controlled activities.

Larger organisations with a variety of activities and objectives will face

several challenges:

 the need to assess whether each type of activity they undertake during a regulated period is ‘for election purposes’ will be a new requirement, and if their assessment is found to be inaccurate (whether by us or by the courts) they may breach the rules unintentionally  even if the large majority of what they do is not regulated, they will only need to spend a few thousand pounds on regulated activity over the year to be drawn into the regulatory regime  if it is judged that one substantial activity, such as an event, is ‘for election purposes’, this could use up or exceed the relevant spending limit. It is not clear that the new spending limits have been based on any evidence of the costs that campaigners incur in carrying on the activities that are to be regulated. The new spending limits for the UKPGE are also inconsistent with existing limits for other elections in the UK 5.

15. It has been suggested to us that these effects could be particularly significant in Scotland, Wales and Northern Ireland, where civil society has often had a prominent role in the development and discussion of new policy and legislation in recent years.

16. The regulatory burden created by the Bill is likely to be significant. The Impact Assessment states that the estimated cost of compliance with the Bill changes for registered campaigners will be in the range from zero to £800.

This assumes among other things that campaigners will need two hours to become familiar with the new definition of regulated activity since it is “a relatively clear and simple requirement”, and that a day of additional information recording will suffice to deal with the new requirement. On the basis of our experience of the effort that campaigners need to make to comply with the current rules, and of our discussions with organisations that For example: the spending limit for the four month regulated period for Scottish Parliament elections is £75,800 whereas the new limit on spending in Scotland for the twelve months before a UK general election will be £35,400.

may be affected by the new rules, we do not think these estimates are credible.

17. The Impact Assessment also estimates that the changes to registration thresholds will lead to between zero and 30 additional campaigners needing to register in 2015 compared to 2010. It is difficult to estimate the likely level of additional registration given the uncertainty around the scope of activity covered by the Bill, but again this appears likely to be a severe underestimate on the basis of our recent discussions with campaigners.

18. The uncertainty and burdens that the Bill will create for campaigners could be mitigated by recasting the Bill’s definitions of what is covered, in a way that provides more clarity about Parliament’s expectations of when each type of regulated activity should be seen as being ‘for election purposes’. This will not be straightforward given the complexity of the issues, and would require careful testing with those potentially affected by the definitions.

19. It has been suggested to us in discussions on the Bill that where it is difficult to set precise rules to regulate activity, imprecise legislation can still have a ‘dampening effect’ and deter activity that might be caught by the rules. Such arguments are for Parliament to consider. However, in our view it is important that the law should be certain and predictable, particularly in the context of elections.

Discretion and the risk of challenge

20. As noted above, the Bill’s new definition of regulated activities is closely modelled on the equivalent definition for political parties. However, when the definition is applied to organisations with a wide range of objectives other than political campaigning it has to be read in that new context.

21. The new definition no longer includes some significant elements of the current definition of election material6. Instead, the Bill simply provides that spending on a relevant activity is controlled if it is incurred “for election purposes”, which are defined as “for the purpose of or in connection with” promoting electoral success for a party or group of candidates.

The current definition states among other things that something is to be treated as election material if it is “made available to the public” and “can reasonably be regarded as intended” to promote electoral success, “even though it can reasonably be regarded as intended to achieve any other purpose as well”

22. The explanatory notes to the Bill state that this wording “does not rely solely on the intent of the third party; the effect of the expenditure must also be considered”, and that spending can be controlled “regardless of whether those incurring the expenditure intended it for another purpose”.

23. Our view, and the view of others with whom we have discussed the definition of “election purposes”, is that in the context of non-party campaigning it is capable of a very wide range of reasonable interpretations. It could be read narrowly, so that activity is only covered if it is quite clearly promoting a particular party or group of candidates. Or it could be read very widely, so that activity is covered if it relates to or discusses a policy that someone could see as being associated with a party or group of candidates, and even if the activity is not directed at the public. A wide reading could cover many types of activity that are not currently regulated.

24. It is part of our regulatory role to provide those who may be affected by the law with clear guidance on our view of what it means. We have done this for the current rules on election material, setting out a ‘purpose test’ and ‘publicity test’ that campaigners can use to determine whether we would regard their material as regulated. We also provide advice on specific cases on request.

25. As noted above, we will also produce guidance to try to help campaigners understand our interpretation of the scope of the new regime. However, we think that the breadth of the new definition means that there is a high risk of our interpretations being challenged, particularly in the early years of the new regime before case law develops. For instance, taking one of the examples

outlined above, a march and rally on a policy issue:

 if we advise the organiser before the event takes place that we consider the event to meet the definition of ‘for election purposes’, that could effectively amount to prohibiting the event, depending on its cost and the amount of other regulated spending that the organiser has already incurred during the regulated period. The organiser might choose to mount a legal challenge on the basis that the event could reasonably be seen as not being for election purposes, or to proceed with the event with a view to challenging any regulatory action we might then seek to take  if we take the view that the event is not ‘for election purposes’, we might equally be challenged by others who believe that the event should be regulated

26. There is also scope for challenges to our interpretation of other aspects of the Bill that are new or will need to be read in a new context, such as the provisions on spending focused on particular constituencies.

27. We aim to take careful and reasonable decisions about our guidance on regulatory issues, and would not therefore expect most challenges to succeed. However, the prospect of a series of challenges to our decisions during an election campaign clearly adds to the uncertainty for campaigners discussed earlier in this submission, and may not improve public confidence in the effectiveness of the rules. Where a challenge on a key point remains unresolved during the intense final stage of an election campaign, this would cause severe and ongoing uncertainty for campaigners, and indeed for political parties.

28. In our view there is also an issue of principle here. The new definition has been framed in a way that leaves a great deal of scope for us to interpret the meaning of the legislation, subject to being over-ruled by the courts as the result of a challenge. This effectively gives the Electoral Commission a wide discretion in deciding what the new regime means in practice.

29. We are independent of Government and directly accountable to Parliament, and it is important that an independent body should be responsible for deciding when the rules on party and election finance have been broken, and how breaches should be dealt with. It follows that we have a role in advising those affected by the rules how we interpret the law, and how to comply.

But we do not think it is appropriate for us to have the sort of wide discretion over the meaning and scope of the regulatory regime that the Bill as drafted appears to provide. Electoral law avoids giving a wide discretion to unelected officials, whether those who run elections or those who regulate campaigning, precisely because of the high risk of being drawn into political controversy and challenge.

30. There is a possible parallel here with the power that the Charities Act 2006 gave to the Charity Commission to define the concept of ‘public benefit’ in guidance. This is in some respects a politically contentious definition and the guidance has been the subject of debate and challenge over a number of years, despite substantial case law and precedent predating 2006. We think the present structure of the Bill has the potential to create problems in a similar vein, particularly since the legislation will be new and initially untested.

31. As with the issue of uncertainty for campaigners discussed earlier in this submission, these concerns could be addressed to some degree by specifying more clearly in the Bill the intended scope of the new definition of regulated activity.

Enforcing the rules

32. The Bill’s changes to the controls on non-party campaigning raise some significant practical issues about enforcement, and Parliament may wish to consider what impact it expects these changes to have in practice.

33. For example, where a campaign appears to be at risk of exceeding a spending limit if an activity is considered to be ‘for election purposes’, would Parliament expect us to intervene to stop that activity happening, for instance by telling an organisation to cancel an event (as in the illustration above) or take down a website? We already take some steps to monitor campaigning at major elections, and have powers to issue ‘stop notices’ in cases where we think that a potential breach could pose “a significant risk of seriously damaging public confidence in the effectiveness” of the PPERA controls.

However, this test of “significant risk” is intentionally high for obvious reasons, and we expect that Parliament would want us to act only in cases where it is quite clear that this high test has been met. In practical terms, even with significant additional resources we would not be able to identify every case of potential non-compliance in advance.

34. At the other end of the scale, the wider scope of the new regime and the lower registration thresholds mean that campaigners could be in breach of the rules even if spending only a small amount each month on staff costs relating to policy or media work. We would expect to take a proportionate approach to minor breaches, but the resources needed to identify campaigners that may be affected, and help to bring them into compliance, will be substantial. Parliament may want to consider the balance between the benefits of bringing small-scale campaigners into the regime, and the associated burdens and costs. The balance could readily be adjusted by raising the proposed registration thresholds.

35. We see particular enforcement challenges in the new controls on spending targeted at particular constituencies. These rely on the concept of spending having ‘no significant effect’ in other constituencies. As with the definition of ‘for election purposes’, the concept of ‘no significant effect’ is capable of a wide range of reasonable interpretations in the context of non-party campaigning at constituency level, and our interpretation may be challenged accordingly. Most non-party campaigners are not of course organised on a constituency basis. Obtaining the information necessary to identify potential cases of non-compliance at constituency level, and particularly the evidence needed to be able to sanction breaches, is likely to be so difficult that these provisions may be unenforceable in practice.

Other issues

Minimising regulatory burdens

36. As already noted, the scope of the new rules is likely to bring many more organisations into the regulatory regime. Organisations that expect to exceed the registration threshold will have to register with us, and will then have to record and report their spending (including spending by constituency and spending that supports a single party, which will have to be managed in conjunction with that party), check the permissibility of donations they receive towards regulated spending, and report such donations periodically before the election, rather than afterwards as at present.

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