Representation of the People Bill

Public Bill Committee, 14 April 2026.

(Morning)

Rosena Allin-Khan (Labour, Tooting)

Good morning. Please ensure that all electronic devices are turned off or switched to silent mode. We now continue line-by-line scrutiny of the Representation of the People Bill. The selection list for today’s sitting is available in the room and on the parliamentary website. That shows how the clauses, schedules and selected amendments have been grouped together for debate.

I remind the Committee that a Member who has put their name to the lead amendment in a group is called to speak first; in the case of a stand part debate, the Minister will be called first. Other Members are then free to indicate by bobbing that they wish to speak in the current debate. At the end of a debate on a group of amendments, new clauses and schedules, I shall call the Member who moved the lead amendment or new clause again. Before they sit down, they will need to indicate that they wish to withdraw the amendment for the new clause or seek a decision.

If any Member wishes to press any other amendment to a vote, including grouped new clauses and schedules, they need to let me know. The order of decisions follows the order in which amendments appear in the amendment paper. I hope that explanation is helpful.

Clause 48 - Absent voting

Rosena Allin-Khan (Labour, Tooting)

With this it will be convenient to discuss:

Government amendments 14 to 17.

Schedule 3.

Samantha Dixon (Labour, Chester North and Neston)

I will speak first to clause 48 and associated schedule 3, before addressing Government amendments 14 to 17 and new clause 40, tabled by the Opposition.

The current legislative framework for absent voting was designed for a very different electoral landscape. Today, far more people vote by post; supply chains and administrator resources are under greater pressure; and expectations around reliability and timely delivery have changed. Developed in consultation with the electoral sector, clause 48 modernises and strengthens the absent voting system to reflect those realities. It streamlines administration, gives electors greater flexibility and ensures that safeguards around the integrity of absent vote applications remain robust.

These measures will enable postal voters to take part in elections with confidence, by helping to ensure their ballot is issued and delivered in good time, while allowing a switch to voting in person or by emergency proxy if their ballot is delayed. They will not apply to Northern Ireland because of the different absent voting regime there and the stricter security requirements around absent voting, which are a result of the history of electoral fraud in Northern Ireland.

Setting clearer rules and deadlines will give electoral administrators the confidence and certainty needed to manage their workload effectively and keep the absent voting system running smoothly at the most demanding points in the electoral timetable. The integrity of our elections is of paramount importance. The clause also strengthens safeguards in the absent voting system by clarifying identity verification requirements, and introduces a clear statutory determination deadline for identity verification. I commend the clause to the Committee.

Government amendments 14, 15 and 16 remove a regulation-making power that the Office of the Parliamentary Counsel has advised is unnecessary. The Bill already provides that a proxy with a long-term proxy postal voting arrangement can make temporary arrangements for a particular poll without affecting that long-term arrangement. Where a proxy instead applies for a proxy postal voting arrangement for a particular election, the correct outcome is that the long-term arrangement is cancelled. That is the policy intention, and the Bill already delivers that without the need for regulation-making powers. The amendments therefore simplify the legislation, remove redundant provisions and ensure the law operates clearly and consistently for electoral administrators.

Government amendment 17 ensures consistency between the absent voting regime and the proxy voting offences in section 61(1A) of the Representation of the People Act 1983. The Bill already allows someone who has applied to be registered, and is only awaiting the end of the objections period, to be treated as a person who “will be registered” for absent voting purposes. Without the amendment, that same person could be granted a proxy vote but might not be legally capable of committing the offence of acting as a proxy for too many electors if they knowingly breached the proxy limits. The amendment closes that gap, reflects the advice of the Office of the Parliamentary Counsel and ensures that the law operates clearly, consistently and as intended. I commend the amendments to the Committee.

New clause 40 seeks to require electoral registration officers to share information with political parties about electors whose postal voting arrangements have expired. While supporting voter participation is important, the Government do not consider the new clause to be workable, proportionate or necessary. As drafted, it does not provide access to postal vote expiry data itself; instead, it links disclosure to details supplied in proxy vote applications for parliamentary elections, which is not how postal voting arrangements are recorded or renewed in practice.

Most postal voters will never have applied for a proxy vote. As a result, for many electors whose postal vote has expired, there would simply be no proxy application data to disclose, meaning that the new clause would not achieve its apparent policy aim. There is also a clear mismatch in scope. The new clause refers to postal vote expiry for

“elections of the kind in question”

but limits disclosure to proxy applications made for parliamentary elections, significantly narrowing and distorting the dataset that would be available.

A question of principle is also at stake. Electoral registration officers already have a legal duty to notify electors directly about when their postal voting arrangements are due to expire and to provide them with information about how to make a fresh application to vote by post. That ensures that voters are informed at the right time without reliance on third parties.

Lewis Cocking (Conservative, Broxbourne)

When postal voters are notified by their local authority that they are about to drop off the roll, does the Minister agree that they should not always be encouraged to do that online? Some people who have postal votes do not want to make online applications. Does she also agree that they should be sent a fresh application from the council, with a freepost envelope for its return, so that they can keep their postal votes?

Samantha Dixon (Labour, Chester North and Neston)

I thank the hon. Gentleman for his question. It is appropriate for electoral registration officers to use their discretion in the circumstances that he describes. They can do that already, and should continue to do so, rather than the Government prescribing the route that they should follow.

Finally, requiring electoral registration officers to respond to ad hoc requests from political parties, alongside their existing statutory write-out duties, would impose a substantial and unnecessary administrative burden. For those reasons, the Government cannot support new clause 40.

Paul Holmes (Conservative, Hamble Valley)

Good morning, Dr Allin-Khan, and good morning to members of the Committee. I suspect that by the end of today I am going to have a super tan, given that sun coming through the window. Thank you to Joe for sorting out the blinds.

I rise to speak to new clause 40 in my name and to talk briefly to clause 48. As the Minister has outlined, the new clause would give registered political parties access to data on expired postal votes. As the Minister said, clause 48 would give effect to schedule 3, which makes various changes to absent voter arrangements. If a voter cannot get to the polling station on the day of the election, they can apply for an absent vote. The Minister has outlined in comprehensive detail the minor amendments to the clause that she has brought to the Committee, and we have no problem with those.

The Electoral Commission’s report, however, on the 2024 general election recommended that postal voting

“should be reformed to improve the service for voters and strengthen resilience”

within the system. The Association of Electoral Administrators has called for a longer electoral timetable, including for UK Parliament elections, and for earlier absent voting deadlines, set at 16 working days before polling day. The explanatory notes to the Bill note the intention to move the postal vote application deadline in Great Britain to three days earlier in the electoral timetable, which will be from 11 to 14 working days before the poll. The Elections Act 2022 introduced a series of measures to tighten the security around postal voting, which included providing that postal vote applications expire after three years. That was to stop the scope for postal vote fraud and error.

However, one of the unintended consequences of that change, which we now recognise with concern, is that the Government have not provided for political parties and elected representatives to have access to postal vote expiry data. Political parties already have access to lists of postal voters, and as the 2022 Act provisions start to bite we are seeing a large drop-off in the number of registered postal voters. It is our belief that all parties should be able to recruit postal voters because of that huge drop-off.

I was talking to my hon. Friend the Member for Broxbourne earlier about how, in some areas of my constituency, postal vote drop-off levels are sitting at around 35%. We think that the Government should allow political parties to have access to data in order to play their part in postal vote recruitment if someone has dropped off. The Government have refused to amend the law to allow that, and Labour Ministers have admitted that the Government do not track the number of postal vote renewals or expiries. Amending the law in this way would be a simple step to support democratic engagement and turnout, and provide a level playing field for all parties. There would be no detriment to data protection rights, given that political parties already have access to who has a postal vote.

It is not for me to argue with parliamentary counsel—I would never do so—so I take the steer of officials at the Minister’s Department about the scope of the clause. However, I look for reassurance that the Minister will come back to the Committee about the general principle of allowing political parties access to the drop-off data; we may return to this issue at later stages. All parties, regardless of their infrastructure and machinery across the country, should be able to help the Government by playing their part in increasing the uptake of postal votes if those often vulnerable and elderly people have dropped off.

I have come back to Parliament for a rest after campaigning in the local elections for two weeks, as I suspect most Committee members have. I met many people who did not know that they had dropped off, which is unfortunately an unintended consequence of the legislation that the last Government passed. If the Minister can give a commitment to write to me about how we can amend the Bill to allow parties access, I will be content not to press new clause 40 to a Division. I would like to hear what the Minister has to say.

Samantha Dixon (Labour, Chester North and Neston)

I thank the hon. Gentleman for his comments; I understand the points he makes. There is a statutory duty for EROs to notify postal voters that their postal vote is due to expire at the end of January that year, and they will be contacting them. The Government’s view is that there needs to be a proportionate approach that does not add a burden in what is already a busy time for EROs. But I will write to the hon. Gentleman to set out current Government thinking in light of his remarks.

Paul Holmes (Conservative, Hamble Valley)

I thank the Minister for that reassurance and I look forward to her letter. The Opposition still think that political parties have a role. Because many elected representatives have access to the electoral roll, we get monthly updates; I know that that is different from what happens in an election period, and I understand that the Minister is concerned about proportionality and the burden placed on election officials. However, we believe that political parties have a role and a right to be able to see the drop-off data. However, for the smooth running of the Committee and to make progress, I will not press new clause 40 to a Division.

Schedule 3 - Absent Voting

Clause 49 - Power to obtain election-related information etc

Rosena Allin-Khan (Labour, Tooting)

With this it will be convenient to discuss clauses 50 and 51 stand part.

Samantha Dixon (Labour, Chester North and Neston)

As set out in our manifesto, the Government are committed to encouraging participation in our democracy. To achieve that, it is essential that electors are kept well informed about elections and referenda in their local area and about other pertinent information, such as the candidates running and the locations of polling stations. The clauses will enable us, in conjunction with the Electoral Commission, to improve online information services to provide that information to the public. Although the information is already available to electors, that service will help ensure that electors have access to consistent and complete information via a central service. The information that election officers may be required to provide will be limited to factual information about the poll and will not include details on the policies of candidates or political parties.

Clause 49 will create a new power for the Secretary of State to require returning officers, counting officers, petition officers and electoral registration officers to share specified information relating to elections and referenda. The Secretary of State can require the information to be shared with the Department, the Electoral Commission or both.

Clauses 50 and 51 specify which officers can be required to provide information, and for which types of elections and referenda. That power will be exercised via secondary legislation, so the exact details of the information required and processes for sharing it will be confirmed in due course. At this stage, our ambition is that the information will be collated by the Electoral Commission and shared with the public via its website. Electoral administrators will be supported to provide the required information and for electors to provide their location to quickly find the most relevant information. This is a straightforward and proportionate measure that we believe will greatly improve the electorate’s access to information and support increased engagement.

Paul Holmes (Conservative, Hamble Valley)

I thank the Minister for that explanation. Around the country, many enthusiasts for democracy, such as myself, will be shaking with excitement about being able to find all the information in one place. Frankly, I cannot understand why we have not moved to such a system before, and I am happy to credit the Minister for her foresight in bringing forward such a forward-thinking proposal.

Even in the last week, candidates were desperately trying to find out who had been nominated in their counties or boroughs at various stages. The information was supposed to be published at 4 o’clock on the Thursday or Friday, but Hampshire county council had not published the information in time. Such things are important for people participating.

What is particularly welcome in these clauses is the fact that people who have various disabilities will be able to access the support available. Many constituents knocking on doors in the last few weeks have raised questions about the support that they might want. Having a single place where somebody can just stick in their postcode, or where they live, and have access to information about the local or national election that they are entitled to participate in is a very good thing. We will not contest the clauses. We think they are a very good move for elections.

Samantha Dixon (Labour, Chester North and Neston)

I agree; we should remove all barriers to electors participating in elections. I thank the shadow Minister for describing how those barriers are in effect.

Clause 52 - Effect of the death of the Sovereign on certain elections and referendums

Rosena Allin-Khan (Labour, Tooting)

With this it will be convenient to consider schedule 4.

Samantha Dixon (Labour, Chester North and Neston)

The clause and schedule 4 ensure that in the event of the demise of the Crown, effective and consistent processes are in place for scheduled local elections and other polls, including mayoral elections, local referendums and Northern Ireland Assembly elections, as is already the case for a parliamentary general election. In the event of the demise of the Crown, if a UK parliamentary general election is taking place, legislation provides for a 14-day pause in the timetable for the general election to allow time for public mourning and the funeral arrangements, and the date of the poll is moved to after the date of the funeral. Different provisions are in place for other types of polls.

We believe that the 14-day pause in proceedings used for UK parliamentary general elections is the most appropriate arrangement, so the clause extends those provisions to a number of other types of election and referendum, including parliamentary by-elections, scheduled local elections, London Assembly elections, mayoral elections, local referendums and Northern Ireland Assembly elections. The measures also apply to certain Welsh elections in specific circumstances, when they are combined with UK parliamentary or police and crime commissioner elections.

A royal proclamation may already adjust the date of a postponed poll for a UK parliamentary general election by up to seven days. Under the Bill, when such a proclamation is made, any other polls combined with the general election will also move so that they remain combined. The Bill also creates an equivalent ministerial power to adjust postponed polls that are not UK parliamentary general elections by up to seven days. The provisions will ensure that consistent and appropriate provisions are in place for polls being held in such circumstances. I hope that Members will support the measure.

Clause 53 - Form of documents for elections and referendums

Rosena Allin-Khan (Labour, Tooting)

With this it will be convenient to discuss the following:

Government amendment 18.

Schedule 5.

Samantha Dixon (Labour, Chester North and Neston)

The clause, schedule 5 and Government amendment 18 deal with parliamentary processes used to update various forms. A range of prescribed electoral forms are set out in legislation, including poll cards, nomination forms and ballot papers. The rules for each type of poll, be it UK parliamentary, mayoral or local government, are set out in separate pieces of legislation. Each set of rules includes a full set of forms, despite the content of each prescribed form being almost entirely the same from one type of election or referendum to the next, so even a minor amendment to a form results in significant duplication across legislation, which is hugely inefficient.

That process is made even more difficult by different parliamentary procedures being required to update the forms in the different pieces of legislation. A good example of that is the recent legislation to add a veteran card to the list of accepted voter ID. That simple addition required an a affirmative instrument to be debated in both Houses to make the change for UK parliamentary elections, a negative instrument replicating the changes for local elections, and a third no-procedure statutory instrument making the same changes to Welsh language forms. That one small change therefore resulted in three instruments and more than 171 pages of legislation.

To reduce the unnecessary burden on parliamentary time, the clause makes a number of streamlining changes and amends the powers in the Representation of the People Act 1983 to allow the forms to be updated far more efficiently. The sector and stakeholders have been asking for this change, which will allow a relatively small but none the less important consolidation of electoral law.

Government amendment 18 is a purely technical change designed to ensure that the Bill operates as intended. It corrects a minor drafting error relating to the proposed changes to improve how electoral forms are updated. It is a routine correction identified during the drafting process and does not affect the Bill in substance. I commend the amendment, clause 53 and schedule 5 to the Committee.

Schedule 5 - Form of documents for elections and referendums

Clause 54 - Removal of requirement to publish election agents’ addresses

Samantha Dixon (Labour, Chester North and Neston)

Harassment and intimidation of voters, electoral staff and campaigners, both online and in person, is totally unacceptable and has a profoundly detrimental impact on our democratic process. We want as many people as possible to engage in our democracy, but sadly there are some who seek to deter involvement through abuse and intimidation.

Candidates already have the option to keep their home address from being published on the statement of persons nominated and on ballot papers, but a requirement remains for candidates who act as their own election agent to have their home address published on the notice of election agents. We are removing this requirement, enabling candidates in this position to provide a correspondence address to be published instead of their home address. We are also extending that option to all election agents. These changes will ensure that those who take part in our democracy can feel safe and secure in their home. I commend the clause to the Committee.

Paul Holmes (Conservative, Hamble Valley)

We welcome clause 54, which, as the Minister outlined, will allow candidates acting as their own agent to remove their home address from publication requirements. I reiterate what the Minister said: intimidation and harassment during any kind of political campaign is unacceptable. We had a very good cross-party debate on harassment in the last sitting of the Committee.

These measures seem very sensible, but I would like the Minister to address something that has just come to me, so is almost guaranteed to be nonsense. When a correspondence address has been given, if impropriety has been found to have occurred in the return of election expenses by either an agent or a candidate, might there be unintended consequences in terms of the paper trail and how that person can be found? For example—the Minister will be aware that this is slightly out there—if a dummy corporation sets up a correspondence address through a PO box, how can we ensure that the agent is held to account through an investigation? The Minister can write to me on that. It just came to me, so I am not expecting an answer now. Other than that, I think the clause is perfectly sensible, and we will not contest it.

Samantha Dixon (Labour, Chester North and Neston)

The hon. Gentleman makes an important point. Election agents could use a PO box as a correspondence address, but not as their office address. I hope that gives him the reassurance that any agent behaving inappropriately would be findable.

Clause 55 - Leave to pay late and disputed expenses claims

Rosena Allin-Khan (Labour, Tooting)

With this it will be convenient to discuss schedule 6.

Samantha Dixon (Labour, Chester North and Neston)

To prevent attempts to circumvent spending limits, current rules require campaigners to seek permission from the courts before they are able to pay invoices late. In practice, most late or disputed claims are delayed due to routine administrative issues. The Electoral Commission has said that the court-based process for leave to pay applications is inefficient and costly, delaying prompt payments and placing unnecessary burdens on campaigners, the courts and suppliers, especially small businesses.

Clause 55 addresses those inefficiencies by transferring responsibility for granting leave from the courts to the Electoral Commission. The commission will be able to give permission to campaigners to pay late or disputed claims. It is right that such decisions are made by the specialist regulator of political finance. By transferring that function to the commission, the clause will reduce unnecessary bureaucracy, support both suppliers and campaigners, and maintain the integrity and transparency of the broader campaign finance framework.

Clause 56 - Delivery and inspection of returns and declarations

Rosena Allin-Khan (Labour, Tooting)

With this it will be convenient to discuss the following:

Schedule 7.

Clause 57 stand part.

Samantha Dixon (Labour, Chester North and Neston)

Under current rules, candidates or their election agents must deliver a return and declaration and any accompanying documents relating to their election expenses to the returning officer. To supplement the extension of the Electoral Commission’s enforcement role, clause 56 will require candidates or their election agents also to deliver a copy of the return and declaration and accompanying documents to the Electoral Commission. Those incurring expenditure in relation to candidates and recall petition campaigners will likewise be required to deliver copies of relevant returns and declarations to the commission.

That will ensure timely receipt of returns and declarations by the Electoral Commission, which is essential to its ability to perform its new regulatory functions quickly, scrutinise returns and deal with those not complying with the rules. The Electoral Commission will also have new responsibilities for making candidate returns and declarations available for public inspection, promoting transparency by facilitating the collection and publication of data on candidate finance in a single source. Allowing the Electoral Commission to prescribe a form of return that campaigners must use will also help campaigners comply with reporting requirements and facilitate scrutiny of returns.

Turning to clause 57, the Electoral Commission has existing duties to monitor and secure compliance with the expenditure and donations rules set out in PPERA, as well as other enactments promulgating rules concerning candidates or their election agents. To enable it to perform those duties effectively, it also has powers to make regulations relating to information that must be included in donations reports that are required under these pieces of legislation.

As part of strengthening the role and powers of the Electoral Commission, we are extending its duty to monitor and secure compliance with rules on recall petition campaign finance under the Recall of MPs Act 2015. However, the power to make equivalent regulations in relation to recall petition returns currently sits with Ministers. Given the precedent allowing the commission to make regulations on information to be required in donation reports where it has regulatory functions, clause 57 provides for the transfer of such regulation-making powers to the commission. That will promote consistency in regulation across the political finance framework, and support compliance with the rules set out in the 2015 Act.

Paul Holmes (Conservative, Hamble Valley)

We think these clauses are sensible, but I have a number of questions for the Minister on their implementation. First, has she had any feedback from the Electoral Commission regarding these added responsibilities? Does she think they are within its current operational capacity? Has the commission given her Department any feedback on whether it is happy to undertake the new requirements that the Government are placing on it, and that it is resourced properly to implement and enforce them, particularly those in clause 56?

Clause 56 places a duty on candidates to send a copy of their returns to the Electoral Commission as well as the local returning officer. I am sure the Minister is aware that there are political parties and independent candidates of all shapes, sizes, abilities and internal machinery. There are associations of all political parties across the country that are run by a couple—at best—of well-intentioned volunteers, who might not necessarily be at the forefront of new electoral law changes. Has the Minister taken that into account? How will she communicate these regulations effectively so that we do not have the unintended consequence of some well-intentioned candidates and agents falling foul of them, just because of the postcode they seek to represent?

The Opposition have a wider concern about changes like this one, especially in the light of the answer given to a written question put by my hon. Friend the Member for Ruislip, Northwood and Pinner. The Government have proceeded with these legislative changes without consulting the Parliamentary Parties Panel. Given that clauses like this one will have a direct influence on and consequences for political parties of all shapes and sizes, it is regrettable that the panel has not been consulted at all on the Bill whatsoever.

I urge the Minister and the Government to take a step back in progress with the Bill’s passage and reset their view on consulting the Parliamentary Parties Panel when they are seeking to make changes of this nature. In that way, political parties represented on the Committee can actually be consulted and give the Government their views. It is regrettable that they have not done so. The Minister has rightly brought the clause forward, but she has absolutely no information about the views on these changes of parties—not just the Conservative party but smaller parties and independent candidates—

I hope the Minister takes that as a genuine nudge. It is a complaint from the official Opposition that these changes, and the Bill in general, have changed precedent. When the last Government introduced the Bill that became Elections Act 2022, the panel was consulted because that legislation affected all political parties on an equal basis. This Government have chosen not to do that. That is regrettable. I look to the Minister to change the course of this Government when it comes to future changes to electoral legislation.

Lisa Smart (Liberal Democrat, Hazel Grove)

It is a pleasure to serve with you in the Chair, Dr Allin-Khan. This discussion about part 4 feels slightly odd because we are having part of the conversation but will have a further conversation on Report, for all the good and understandable reasons that we have talked about, after the publication of the review by Sir Philip Rycroft. Many people truly welcome Sir Philip’s work and some of us were fortunate enough to take part in it, but we are discussing the measures under consideration while fully aware that we expect further movement from the Government.

I will speak to the new clauses tabled in the name of the Chair of the Joint Committee on National Security Strategy, the hon. Member for Warwick and Leamington (Matt Western). We Liberal Democrats welcome clauses 56 and 57, but the JCNSS did a huge amount of work looking at money and interference in our politics, and it has made some recommendations, which are manifested in the new clauses. The JCNSS welcomed the Government’s commitment to commence section 54A of the Political Parties, Elections and Referendums Act 2000. That section was inserted in 2009 but never commenced. It covers requirements for donors to make a declaration about their donation, but the Committee found that the provisions need more work to adequately address concerns about donors acting as conduits for foreign money. New clause 47 would require the Government to commence section 54A of the 2000 Act within three months of the Bill being passed. The subsequent linked new clauses change the provisions of section 54A to address its shortcomings.

Regarding new clause 48, the JCNSS heard evidence that law enforcement often faces prohibitively high thresholds for taking action on suspicions of wrongdoing, and that part of the problem is linked to the wording of the legislation, which requires law enforcement to prove that actors “knowingly” broke the rules. New clause 48 would lower the threshold and use wording in line with that of anti-money laundering regulations, whereby persons are liable if they have reasonable grounds to suspect that they are facilitating impermissible donations.

Regarding new clause 49, the JCNSS questioned why it would be appropriate to have such a high threshold—£11,180—for making a declaration. It perceived a gap that could be exploited. For example, a UK donor might receive £11,179 from a Russian source in connection with a planned donation but would, apparently, not need to declare that when making a £11,179 donation. The JCNSS noted the general principle that donations below £500 are largely outside the reporting scope of PPERA and would not need to be reported or recorded. A £500 threshold might therefore prove a more robust basis to guide the level at which money received in connection with a donation needs to be declared. The new clause would require any donation above £500 to be accompanied by a declaration on its source, and whether related gifts have been received. Transparency and consistency are both good things, of which there should be more.

Paul Holmes (Conservative, Hamble Valley)

I wonder if I could urge the hon. Member to change her view. Does she not think that the £500 threshold is very low, if we consider the fast period when a candidate may be fundraising, during the longer term of an election period? Many of our constituents will give money during that period. At £500, the burden placed on candidates and on the person giving the money would be probably too harsh. The threshold needs to be lifted to something more realistic.

Lisa Smart (Liberal Democrat, Hazel Grove)

I welcome the shadow Minister’s intervention, and I think that we should talk far more than we do about domestic money in politics, as well as foreign money in politics. Power is concentrated in far too few hands. The price of elections is going up and up, and that is not good for democracy. I would welcome that discussion.

New clause 49 is in the name of the Chair of the JCNSS, so I am speaking to it on his behalf. We are talking about £500 during the course of a calendar year, so £50 a month breaches the threshold. I think there is a conversation to be had. As I say, this new clause is not in my name.

On new clause 50, the Committee heard evidence that the current 12-month prison sentence was not an adequate deterrent. Also, the low sentences reportedly limit the type of investigatory tools that law enforcement may use in an investigation. I am content to speak to the new clauses on behalf of the Member who tabled them, the hon. Member for Warwick and Leamington.

Ellie Chowns (Green, North Herefordshire)

I rise to speak to both the clauses and the new clauses tabled by the hon. Member for Warwick and Leamington, which the hon. Member for Hazel Grove spoke to.

Briefly, commencing section 9 to PPERA, as proposed by new clause 47, is something that was put into legislation 17 years ago, so it feels really quite overdue. Regarding the points that were just discussed around new clause 49, which proposes the reduction to £500 of the threshold for declaring the source of a donation, making such a declaration is not necessarily a hugely onerous process. I imagine that when someone makes a donation and fills in a form, they just put, “Source: my salary”. This is not necessarily a hugely problematic part of the process of creating more transparency. We surely all agree that more transparency is needed in our political financing system, to protect from the corrosive effect of foreign donations, and of huge inequalities and the lack of transparency over domestic donations. I strongly support all the new clauses.

I will raise a couple of additional points, which I would like the Minister to respond to. First of all, regarding the provision in clause 56 and schedule 7 to submit two returns now—to both the local returning officer and the Electoral Commission—I note that the Electoral Commission, in its briefing to the Committee, argued that this provision clearly makes things more complex and problematic, and it argued that the primary responsibility for submission should be to the Electoral Commission. Does that not make more sense? Given that the Bill is introducing a requirement to submit to the Electoral Commission, why do not we just say, “Submit the return to the Electoral Commission”? Then the Electoral Commission can correspond with the returning officer if it wants to. But let us just have one submission and make the process as simple as possible for candidates and parties. Could the Minister respond on that point from the Electoral Commission about the requirement to submit two returns?

Secondly, a point raised by Philip Rycroft in his extremely useful report, under recommendation number 7, is that

“The Electoral Commission should mandate political parties to submit their annual reports and accounts and campaign spending returns in a standardised format.”

Could the Minister comment on whether she proposes to take that recommendation forward? It would be very helpful in improving transparency and clarity in the system.

Lloyd Hatton (Labour, South Dorset)

I will just make some very brief remarks on the record.

I welcome this landmark Bill, which does a great deal to bring our democratic landscape into the 21st century, but I will briefly put on the record some thoughts about new clause 47.

As we digest the Rycroft review, I think that the new clause is worth further consideration, particularly about how we can have meaningful deterrence for the most egregious flouting of political finance rules. If we want to be able to deal with that issue, we also need to have effective prosecutions for serious breaches. My concern at the moment is that there is something of an enforcement gap, and I know that that is a description that the Electoral Commission has outlined as well. I remain concerned that when it comes to the real risks posed by foreign interference, we are leaving that gap open, which would run contrary to the rightful and important aims of this Bill.

The director general of the National Crime Agency highlighted here in Parliament in February that there is a “gap in law” and that

“a foreign state or foreign individual—someone who is impermissible—can transfer money to someone who is in the UK, who is permissible, and that person can give money to a political party or a politician, and there is nothing to stop that. That is perfectly lawful.”

There is an enforcement gap there that I know that the Minister, along with other Ministers and officials, will want to address. It is worth reflecting further on the aims of new clause 47 and how it tries to strengthen this Bill further beyond the work that it already does. As we look to digest the Rycroft review, and the Bill proceeds to further stages, it is important that we give the aims in the new clause rightful consideration, and think about some of those issues around the gap in enforcement when it comes to the most egregious breaches of political finance rules.

Samantha Dixon (Labour, Chester North and Neston)

A number of points have been made, which I thank hon. Members for. I can reassure the shadow Minister, the hon. Member for Hamble Valley, that we have worked closely with the Electoral Commission on these proposals. All my officials talk to the Electoral Commission constantly, so its capacity to take this on board is understood.

In terms of consultation, we always work with the parliamentary parties panel. However, as I was coming into this position, I reached out to all the leaders of the opposition parties and invited them to come to talk to me about the Bill prior to its Second Reading. Not all took up the offer; however, I was pleased to meet those who did.

Turning to the point about the two sets of returns, it is still important to address the point raised by the shadow Minister and the hon. Member for North Herefordshire. It is important for returning officers to receive returns and declarations, because having those available for inspection at the local level remains an important part of our democracy. I would not want to see that taken away. That is why we are proposing both the EC and returning officers receive them.

On new clause 47, the Government fully recognise the importance of greater transparency over the source of political donations, and we are already taking that forward. Work to activate donor source declarations is underway as part of our wider political finance reforms, and the Government have been clear that those measures will be delivered in this Parliament. The new clause would not change our direction or add new policy substance. I understand that the hon. Member for Hazel Grove is eager to see this implemented quickly, and I want to reassure the Committee that this is a Government priority. However, imposing a fixed deadline risks cutting across the careful sequencing needed to implement reforms coherently.

We need to align commencement with the broader package, ensuring that guidance and systems are ready, and give campaigners proportionate lead-in time. That speaks to the point made by the shadow Minister that this is about not just the established parties but smaller parties as well. A rigid statutory date risks poorer implementation without adding any new substance to what the Government are already delivering. Our approach is to activate donor source declarations in step with the wider package in the Bill, so that parties can have clear and workable rules and the Electoral Commission is operationally prepared. On that basis, I hope the hon. Member will feel able not to push the new clause to a vote.

New clause 48 seeks to lower the criminal threshold for two political finance offences so that a party treasurer or a responsible person would commit an offence when it could be proven that they had

“reasonable grounds for knowing or suspecting”

that a declaration accompanying a campaign or referendum expenditure return was false. Currently, prosecutions for such offences are possible only when it can be proven that the offender “knowingly or recklessly” makes a false declaration. That threshold was designed to reflect the seriousness of criminal liability and ensure that sanctions target deliberate and clearly irresponsible wrongdoing.

The Government welcome Philip Rycroft’s comprehensive and well-reasoned report on foreign financial interference in our democracy, which includes relevant recommendations in this space. Any proposal to amend the knowledge test for relevant offences will need to be considered with great care to ensure that party treasurers and responsible persons are not unduly exposed to potential criminal sanctions for administrative errors or inadvertent admissions. It is also important to consider the political finance regime in the round to avoid amendments creating inconsistencies between parts of the statutory framework.

The Rycroft review provides a valuable basis for broader consideration and the Government are actively working through its recommendations to ensure that political finance rules and their enforcement remain proportionate, coherent and fit for purpose. For those reasons, although we do not support new clause 48, we will continue to assess the review’s findings carefully and will set out a full Government response, including whether making further amendments to the Bill would be appropriate. Given that reassurance, I hope the new clause will not be pressed.

The integrity of political finance depends on measures that are both effective and proportionate. That is why the Bill introduces stronger due diligence expectations and tougher rules for institutional donors. Our general approach has been to address weaker points of the framework where there is greater risk. While the intention behind the new clause is acknowledged, reducing the declaration threshold to £500 does not follow that risk-based approach and could end up weakening the system.

In that respect, I share the views of the shadow Minister because I believe the new clause would create a large volume of low-value declarations and, in doing so, divert the time and energy of donors, recipients and the regulator on to lower-risk activity. We want resources to be focused on higher-risk activity, such as the enhanced due diligence that we want donors to undertake when they receive larger donations. The Government believe that the risk-based approach that we are taking in the Bill is the right one. It ensures that further scrutiny will be applied where it matters most.

New clause 50 seeks to increase the maximum criminal penalties that can be imposed for various false declaration offences under the political finance framework. In the Bill, the Government are acting on long-standing recommendations to strengthen the Electoral Commission’s power and extend its remit to ensure that enforcement provides a clear deterrent against breaking the law, while remaining proportionate. However, we recognise that we cannot be complacent, so we welcome the Joint Committee on National Security Strategy’s recent report and Philip Rycroft’s independent review on foreign financial interference in our democracy. They both include relevant recommendations regarding the enforcement of political finance offences.

Any proposal to increase sentencing for such offences will need to be considered carefully to ensure that criminal penalties remain proportionate. It will also be important to consider the political finance regime and its enforcement in the round to prevent amendments from creating inconsistencies between parts of the statutory framework. The Rycroft review provides a valuable basis for that broader consideration and the Government are actively working through its recommendations to ensure that political finance rules and their enforcement remain proportionate, coherent and fit for purpose.

Noting that new clause 50 covers ground similar to one of Mr Rycroft’s recommendations, we will assess the review’s findings carefully and set out a full Government response, including whether to make further amendments to the Bill in the light of that work.

Paul Holmes (Conservative, Hamble Valley)

Does the Minister see the absurdity of the Government’s strategy in this area of policy? The Government commissioned a huge review—a good review—by Philip Rycroft that they need to examine and consider properly. But we are discussing a section of the Bill where although a direct influence on future legislation is outlined by Philip Rycroft, the Minister is resisting amendments from other political parties, saying she will bring in amendments later because the Government have not considered Rycroft’s review properly. She is not going to accept this, but does she not see that the way the Bill is working is absurd? We are going to have retrospective amendments when it comes to the review, but the Minister will only accept amendments from her own side and not from other political parties.

Samantha Dixon (Labour, Chester North and Neston)

The shadow Minister is, of course, fully entitled to his views. However, the new clauses relate to a very narrow framework in the Bill. The Government are considering the review and its recommendations from a much broader, cross-Government perspective. That requires much broader work. We will bring our response to the review to Parliament in time for proper scrutiny.

Clause 58 - Risk assessments for donations to registered parties etc

Samantha Dixon (Labour, Chester North and Neston)

I beg to move amendment 39, in clause 58, page 67, line 38, leave out “, when it” and insert “—

(a) the party has not previously undertaken a risk assessment in relation to a relevant benefit accruing to the party in the same calendar year, and

(b) when the value of the donation”.

This amendment would mean that a risk assessment is required for donations when the £11,180 threshold (for donations or regulated transactions) is breached the first time in a calendar year. (See also amendment 40, which requires a risk assessment the second or subsequent time the threshold is breached.)

Rosena Allin-Khan (Labour, Tooting)

With this it will be convenient to discuss the following:

Government amendments 40 and 41.

Amendment 32, in clause 58, page 68, leave out from beginning of line 15 to end of line 21 and insert—

“(2) In carrying out a risk assessment, the party must prioritise taking into account whether the person from whom the donation is received is a foreign citizen and likely to have foreign influence links.

(2A) In carrying out a risk assessment, the party must treat donations from UK citizens, who reside in the UK, as a low risk.

(2B) In carrying out a risk assessment, the party must also take account of the following risks—

(a) the type of person from whom the donation is received,

(b) that person’s previous donation history,

(c) the type of donation,

(d) the amount of the donation, and

any other risk factors the party considers to be relevant.”

Amendment 31, in clause 58, page 68, line 20, at end insert—

“(da) whether the person from whom the donation is received is required to register under the Foreign Activities and Foreign Influence Registration Scheme established by the National Security Act 2023.”

This amendment would require the risk assessment to take into account whether a donor is required to register under the Foreign Activities and Foreign Influence Registration Scheme.

Government amendments 42 and 43.

Clause stand part.

Government amendments 44 to 78.

Schedule 8.

Samantha Dixon (Labour, Chester North and Neston)

I will first speak to clause 58, schedule 8, Government new clause 60, and Government amendments 39 to 41 and 44 to 78, before turning to the amendments tabled by the Opposition.

In line with recommendations from the Electoral Commission, the National Crime Agency and the Committee on Standards in Public Life—now known as the Ethics and Integrity Commission—clause 58 addresses a long-standing gap in electoral law. Current rules require recipients of donations to verify the permissibility of the donor but do not require them to assess whether a donor may be facilitating a donation from an impermissible source. Existing permissibility checks remain important, but they do not always provide sufficient assurance where donations are routed through third parties or where risk indicators are present.

The clause introduces a clear, proportionate due diligence duty on campaigners to look beyond current permissibility checks and determine whether there is a material risk that a political contribution originates from an impermissible source. The new framework strengthens the ability of campaigners to assure themselves that donations come from permissible sources. Its purpose is not to impose unnecessary burdens, but to ensure that campaigners take reasonable, proportionate steps to understand who is behind a donation. By embedding a culture of risk-based due diligence, the clause helps to guard against foreign interference, increases confidence in the integrity of donations, and aligns political finance rules with best practice in other sectors.

Government amendment 39 to 41 and 44 to 78 seek to clarify the point at which a political donation exceeds the £11,180 thresholds and requires a risk assessment under the new “know your donor” rules. Currently, the Bill requires a risk assessment once a recipient receives cumulative contributions from the same donor surpassing £11,180 in a calendar year. However, after that point is reached, every further donation received from the same donor in the same calendar year, regardless of value, would require another risk assessment. That was not our policy intention.

Under the updated approach, a risk assessment will be required each time a donor gives £11,180 cumulatively or as an individual donation, after which the running total in effect will reset to zero. That replaces the previous rolling aggregation threshold, removing unnecessary repetition and ensuring that parties complete a risk assessment only when receiving a further significant donation from the same donor. Risk assessments could be carried out on every donation if a campaigner feels the need to do so.

The provisions will also be amended so that both donations and regulated transactions from the same donor are aggregated for registered parties and regulated donees. The amendments will require third-party campaigners, for the purposes of risk assessments, to aggregate donations on a calendar-year basis rather than by the same election. Consequently, aggregation will occur for relevant donations across all elections, meaning that if multiple elections overlap, all relevant donations across those elections will be aggregated.

The changes provide a clearer and more workable legislative approach to aggregation. They will ensure that donees undertake a risk assessment at the appropriate point of risk, avoid redundant assessments for subsequent donations from the same donor and align the legislation with the new rolling threshold model. The amendments help to maintain appropriate safeguards without creating additional administrative burdens for parties.

Government amendments 39 to 41 and 44 to 78 will ensure that the “know your donor” framework respects the UK’s devolution settlements, while maintaining a coherent and consistent approach to political finance. First, where the power to issue “know your donor” guidance relates to matters that fall within devolved legislative competence, the amendments will require the Secretary of State to consult Ministers in the Scottish Government and Welsh Government before approval. In addition, where legislation modifies risk factors in devolved areas, the Secretary of State must obtain the consent of the relevant devolved Administration.

The amendments also provide that Ministers in the Scottish Government and Welsh Government have the power to vary the £11,180 threshold, reflecting their existing responsibilities for devolved electoral matters. At the same time, the amendments help to preserve overall UK wide consistency in the “know your donor” regime, so that recipients of donations operate in a single, intelligible system. The Government consider that the amendments strengthen the operability of the “know your donor” provisions, as well as respecting devolved competence. We therefore encourage the Committee to accept them.

New clause 60 is a technical amendment to ensure that Scottish Ministers have a power to change the £11,180 “know your donor” requirement threshold where it relates to devolved matters. Given the technical nature of the amendment, I urge Members to accept it.

Amendments 32 and 31, tabled by the Opposition, would require parties to prioritise foreign citizenship when assessing donor risk, automatically treat UK-resident UK citizens as low risk, and add foreign influence registration scheme status as a statutory risk assessment factor. The amendments raise an important issue, and we fully understand the concerns around foreign influence in UK politics. However, the changes could narrow the scope of due diligence and unintentionally create gaps.

Clause 58 already introduces a clear, risk-based approach that requires recipients of donations to take reasonable, risk-based steps to understand the source of significant donations. This framework is designed to help to identify and address foreign-linked risks. The existing risk assessment factors are intentionally broad, allowing recipients of donations to take account of all relevant risks, and allow the Electoral Commission to provide guidance that addresses the wide range of risk factors, including foreign interference. Introducing very specific and targeted risk factors could unnecessarily narrow the focus of risk assessments and divert attention from more relevant risk indicators, such as donation history or patterns of financial behaviour. Additionally, some UK-resident UK citizens may still present indicators of higher risk, and recipients of donations should not be prevented from recognising that.

Specifying a donor’s foreign influence registration scheme status as a risk assessment factor is unnecessary. The existing clauses already allow foreign links, status of the foreign influence scheme and other relevant indicators to be considered. That will ensure that risks relating to foreign influence can be assessed in a way that is flexible and can adapt as new threats emerge.

I am conscious that the Rycroft review made a recommendation to include some additional, broader categories of risk factor. We are carefully considering all the recommendations in the Rycroft review and will issue a Government response in due course. Where appropriate, we will table amendments to the Bill. I hope that the Opposition are reassured by those comments.

Paul Holmes (Conservative, Hamble Valley)

I rise to speak to clause 58 and to Opposition amendments 32 and 31, which would require the risk assessment to take into account whether a donor is required to register under the foreign activities and foreign influence registration scheme.

As the Minister outlined, clause 58 would make changes to PPERA to require registered political parties to undertake risk assessments on reportable donations—those more than £11,180. Multiple donations from the same donor within a calendar year would be aggregated for the purposes of the threshold. Similarly, schedule 8 would require third-party campaigners and others already regulated under PPERA to undertake “know your donor” risk assessments. We welcome the Minister’s approach to tightening the regulations around political donations. As the hon. Member for Hazel Grove said, we need to talk much more about this issue, including domestic donations. We think that the clause has some really strong attributes to increase transparency and equalise the donation procedure.

I take issue with the Minister’s interpretation of the consequences of amendments 31 and 32, although she recognised that they are well intentioned. I fail to see how they narrow the scope of the risk assessment, when they would actually broaden it. It seems alien that the Government are not willing to broaden the scope of those risk assessments with a system that has been in place since 1 July 2025. If we reject these two amendments, do we not risk creating two frameworks? We would be wilfully leaving out an existing framework when trying to do risk assessments. It would strengthen the risk assessment if we brought into play an existing framework that already undertakes regulation.

Our amendments would broaden the scope of the risk assessment rather than narrow it. When somebody is making a donation to influence the role of Members of Parliament, and they are voluntarily registering themselves under the foreign influence scheme, it is important that that is included in our donations regime. It does not stop the well-intentioned aims of the clause from operating, because this already exists. I fail to understand the Minister’s resistance to the two amendments.

We are discussing very important attributes of the Bill and very important subject matters: donations to political parties. We have all had our bad ones. We have all had our good ones, which enable democracy to take place. We have had a comprehensive and welcome review from Philip Rycroft. The Minister has outlined that the Government will undertake a solid consultation response to that review, but we are pushing ahead with clauses that will, let us face it, be passed in this Committee and then in the House at later stages of the Bill. The Minister will bring forward amendments that will be debated, but there has not been a consultation.

We have always contested that the measures in the Bill could be paused until there is a proper cross-party review of the Rycroft review. If we could come to some agreement on a cross-party basis, the later passages of the legislation could be fast-tracked. It is regrettable that the Minister and the Government—although I do not blame the Minister personally—are coming to this House with important and forward-looking legislation without taking into account a proper review to directly influence the proposals they have introduced. I do not think a general election is imminent—unless the Minister suddenly gives us cause for concern—so a pause would not be detrimental to the passage of the Bill. It could give scope for cross-party agreement on the proposed reforms and speed up the passage of the Bill.

The Bill is a significant piece of legislation, but it has been introduced only at the tail end of the parliamentary Session. I am aware that there is a carry-over motion, and the Conservatives fully support that through the usual channels, so why rush the clauses when we have not had the proper implementation and review of the Rycroft review? It would make far more sense to introduce a consolidated Bill in the next Session after cross-party consultation so that we can have a proper discussion, rather than fast-tracking the Government’s tabled amendments.

I am sure that the Minister will respond to that in her usual courteous way, but I would be grateful if she could outline why she seems to think that amendments 31 and 32 would somehow hinder the operational regulatory implementation of her proposals. They would actually broaden the scope, and, we would argue, back up its implementation through already existing legislation. We regret the attitude that the Government have taken to the importance of the Rycroft review and the consultations with all political parties through the Parliamentary Parties Panel. I remind her that a written question has outlined that there was no consultation on a cross-party basis before the Bill was introduced to the House. We will be push amendments 31 and 32 to a vote.

Lisa Smart (Liberal Democrat, Hazel Grove)

We Liberal Democrats support greater scrutiny of the sources of political money. We will not oppose any of these amendments, whether from the Government or His Majesty’s Opposition, but we want to raise some issues because we believe that they could have gone further.

The amendments were tabled, as has been mentioned, following the publication of the Rycroft review, but revisions around cryptocurrency donations are not included in them. In a welcome statement to the House, the Secretary of State talked specifically about banning crypto donations, but there is no mention of that in the Bill. The Government accepted Sir Philip’s recommendation on the day that it was published, so why is there nothing about that in this group of amendments? The Government have a ready vehicle for it in front of them, so the Committee would welcome an explanation of why that is. Can the Minister set out a planned timetable of future actions, including a firm commitment on when a cryptocurrency amendment will appear?

The shadow Minister talked fairly about how this process is running in parallel, making it quite difficult to understand what is ahead of us. The Government are working on a response to the Rycroft review in full, and there are measures in the Bill that they will be keen to ensure are implemented in time for the next general election, including votes at 16 and automatic voter registration. Those will take time to implement, so I understand that the Minister is playing a reasonably sticky wicket, trying to go at pace but in a thorough and considered manner. She has not been dealt an easy hand, but I would appreciate hearing about her planned timetable for issuing further amendments.

I am sure that the Minister agrees about the scale and immediacy of the threat that some of the amendments seek to address, including foreign interference in our elections and democracy. Urgency on those actions is needed. It is important to get these measures in place as soon as possible, but they really should be the right measures. I would welcome hearing from the Minister about when she plans to bring forward further information, and I am sure that we all look forward to scrutinising that in due course.

Ellie Chowns (Green, North Herefordshire)

Broadly, I hugely welcome all measures to improve the risk assessment of donations, which is critical, so I am glad to see those here. I agree that much more needs to be done than is currently in the Bill, as outlined by Philip Rycroft, among others, so I welcome the Government’s commitment to do that. I share the frustration expressed about the fact that we have two processes going on in parallel and so, from my perspective, we will not have sufficient opportunity adequately to scrutinise the proposals that the Government are promising to bring forward in relation to Rycroft. However, I absolutely feel their urgency and look forward to whatever opportunity we do have to scrutinise them.

I agree with the hon. Member for Hazel Grove that there are critical missing elements that we could and should be addressing in this part of the Bill: crypto donations, in particular, but also the desperate need for an overall cap on political donations. We will be able to discuss those issues later, when we come to the new clauses, but it seems rather odd that the Government have put nothing in this part of the Bill in relation to those critical elements.

I want to raise two specific issues in relation to this group of amendments. First, the Electoral Commission has made two points about the articulation of risk factors. It would like the list of risk factors to include any other risk factors that a reasonable party would consider relevant, rather than any other risk factors that a political party itself considers relevant, because that would constitute marking its own homework. It seems to me that that small tweak to language would clarify the risk factors. The Electoral Commission also recommends the inclusion of a risk factor relating to a person’s connections to other countries and jurisdictions. That might be a more inclusive way of addressing some of the points about a foreign influence registration scheme. I would welcome the Minister’s comments on those two recommendations—requests, essentially—from the Electoral Commission.

Secondly, in a report produced last month, CenTax—a joint initiative of the London School of Economics and the University of Warwick—pointed out that it would be potentially much more sensible to establish a donor registration system operated by the Electoral Commission itself. That would mean transferring responsibility for the risk assessment for “know your donor” checks to the Electoral Commission rather than to political parties, which, depending on their size and longevity and so forth, might have varying capacities to do that. When a donor wished to make a donation to a party above a certain minimal threshold, they would apply to the Electoral Commission for a donor registration number and then use that when making the donation. That would make it much easier to keep track of multiple donations by a given donor, either to a single party over a period of time or to multiple parties.

That seems to me a sensible and workable proposal for improving transparency and clarity in the system, recognising and addressing the burden of compliance requirements that will be placed on parties—including local parties, which, as has been mentioned, are very much reliant on volunteers—and ensuring a consistent approach to donor risk assessment and monitoring. I would welcome the Minister’s response to that recommendation from CenTax that a donor registration system should be established.

Lloyd Hatton (Labour, South Dorset)

Before I speak to clause 58, let me say in response to the hon. Members for Hamble Valley and for Hazel Grove that this game-changing legislation and the Rycroft review have both come in the first Session of a new Government. There is a clear understanding—the Minister has made it known here and in the Chamber—that the threats that we face, whether through foreign interference or foreign money trying to influence our democratic process, are severe, and we have made a robust response to them, through this legislation and by commissioning the Rycroft review last year.

I want to make two points on clause 58. First, a key part of the changes introduced by the Bill is the “know your donor” principle, which will require political parties to take more responsibility for exactly who is funding them. Existing rules do not specifically require recipients to consider the risk that a donor is potentially facilitating an illegal donation. I welcome the fact that that will change as a result of this clause, which will bring about a complete overhaul of the system and I believe will improve the integrity of our democracy, help strengthen national security and help restore trust in political parties across the country.

Paul Holmes (Conservative, Hamble Valley)

The hon. Gentleman is absolutely right that the clause is important. We do need to have a greater say. He says he supports the clause, and I agree with him, because he is very sensible. But given some of the headlines we have had across the House in recent weeks about the origins of donations and the facilitation of bad donations, why does he not agree with us that foreign influence registration should be part of the risk assessment? Does he share my concern that the Government have rejected that?

Lloyd Hatton (Labour, South Dorset)

I do not believe that the Government are rejecting that carte blanche. As I was about to say—it is almost as if the hon. Gentleman has my notes before him—the Rycroft review commissioned by this Government notes that the “know your donor” provisions are similar to the anti-money laundering checks that are required by thousands of organisations, large and small, in the private sector, the third sector and elsewhere. Those are about ensuring that financial transactions, such as a donation, are indeed legitimate. As we digest the Rycroft review, I hope and expect that the Minister will give careful consideration to what it sets out and look at the idea that “know your donor” checks should more closely mirror the due diligence checks we see elsewhere, particularly in relation to anti-money laundering regulations.

In making my second point, which I think is worthy of further consideration, I think it will be helpful to provide a case study. As Members on both sides of the Committee will recall, earlier this year the hon. Member for Great Yarmouth (Rupert Lowe), a former Reform UK MP—I notified him that I would be mentioning him—launched a new political party, Restore Britain. Before that, however, he set up a “political movement”, and he may or may not—we do not know—have received substantial contributions from impermissible sources before Restore Britain was registered officially as a political party. The fact is that we simply do not have a clear understanding, and the current legal landscape means that there are no checks on the funds that a party may hold prior to formal registration.

I should make it very clear that the Bill goes far in strengthening controls on the sources of donations to political parties, and goes a great way to shoring up our democracy against foreign interference. However, I would really welcome the Minister’s thoughts and ideas on how we can ensure that a political party does not seek to sidestep controls on donations and loans by accepting substantial contributions from a potentially impermissible source simply because it has not yet set itself up officially as a political party.

I know that this is something that Rycroft seeks to understand at a top level in his review, so I do not expect it to be dealt with in Committee—I think that would be wrong, because we had the review only just before the Easter recess—but I would welcome the Minister’s thoughts, as the Bill proceeds, on how we close down the potential problem whereby political movements, political projects or whatever we want to call them seek to gain donations outside the controls and checks that would apply if they were a registered political party.

Rosena Allin-Khan (Labour, Tooting)

Order. Before I call the Minister, I remind hon. Members that it is not necessarily befitting of the House to make comment on whether other hon. Members may or may not have conducted matters in a dishonourable fashion.

Samantha Dixon (Labour, Chester North and Neston)

I thank Members for the wide-ranging and constructive points that they have made. The Government accept the thrust of the amendments tabled by the hon. Member for Hamble Valley; however, we believe the existing clauses already allow for foreign links, the status of the foreign influence registration scheme and other relevant indicators to be considered.

It is important for us all to consider—this speaks to a point that the hon. Member for North Herefordshire made—that, as drafted, the list of statutory risk factors is capable of amendment by secondary legislation, so that the framework can remain up to date. As new risks emerge, they can be addressed through secondary legislation. The hon. Member for Hazel Grove made the point that this is a very fast-moving landscape. When the Government introduced the strategy last July, it was prior to the conviction of Nathan Gill. New risks have emerged in considerable number in the past year, and my hon. Friend the Member for South Dorset described how new parties are emerging. It is important that legislation is not prescriptive in a way that hampers consideration of risks as they emerge.

I appreciate the sensitivity that the hon. Member for Hazel Grove expressed—I think the hon. Member for Hamble Valley understands this too—to the challenge of legislating in a fast-moving landscape. The Government are responding as promptly as we can. On the timetable, Parliament will be prorogued soon—I do not know when; my hon. Friend the Government Whip may have more intelligence on that—but this is a carry-over Bill, and that is important given the consideration and consultation that needs to happen as we respond to the Rycroft review.

David Simmonds (Conservative, Ruislip, Northwood and Pinner)

I want to pick up on the implications of the points made by my hon. Friend the Member for Hamble Valley and the hon. Member for South Dorset. We are all aware that Reform was the first political organisation to come into being as a private company. It operates outside the framework of a traditional political party, and that carries with it some risks.

As the Minister has outlined, the intention is that the framework identifying those risks can be regularly updated. However, that organisation has been in existence for some six years, so this is not something that has suddenly materialised. The point that my hon. Friend outlined in his contribution, and in the amendments covering things such as FIRS, is that that these are emerging risks that we have all been aware of for some time.

I appreciate the Minister’s point about the timetable and where we are in this Session, but it would be helpful to understand from her how soon those long-standing risks that we have been aware of for some time will find their way into secondary legislation and therefore the framework, or where they might feature in amendments on Report so that they can be properly taken into account.

Samantha Dixon (Labour, Chester North and Neston)

The hon. Member will appreciate that implementation of the Bill will require substantial secondary legislation. As tempting as it is to set out a timetable, we have to focus on getting the primary legislation through first. There is the tension, which the hon. Member for Hazel Grove described, between going at pace to implement measures such as votes at 16 and considering as comprehensively as possible the matters that arise from the Rycroft review. It is a challenge, albeit not an insurmountable one, for the Government to do both.

Considerable parliamentary time will be devoted to the secondary legislation; that will become clearer as time progresses. We need to move forward as swiftly as we can. We will introduce the amendment regarding crypto when parliamentary time allows, and we will ensure that it has parliamentary scrutiny. I have noted the comments by the hon. Member for North Herefordshire about a donor registration scheme. None the less, it is beholden on political parties, candidates and campaigners to take seriously the risks from donors. It will be their responsibility, under this legislation, to assess those risks, and if they are found to wilfully, recklessly or knowingly circumvent them, they will be subject to prosecution.

We need to move forward with this legislation as much as we can. I sense the frustration from Members across the Committee about the time that will be required to do this, but we need to do it thoughtfully, carefully, and at pace but not too fast. I jest, but we will do it as soon as we possibly can in a way that does not jeopardise scrutiny.

Schedule 8 - Risk assessments for donations to registered parties etc

Clause 59 - Permissible donors not to include individuals under 16

Samantha Dixon (Labour, Chester North and Neston)

With the introduction of votes at 16, 14 and 15-year-olds will be able to pre-register as attainers for up to two years before they reach voting age. To safeguard the data of young people, their electoral register data will be subject to enhanced protections. These enhanced safeguards will restrict access to under-16s’ electoral registration data, meaning that political parties and other recipients of political donations will not be able to independently verify whether a 14 or 15-year-old is on the register.

Clause 59 closes a potential loophole by prohibiting donations from under-16 attainers, ensuring that the electoral regime remains secure, while still allowing 16 and 17-year-olds, whose details can be verified, to donate like all other voters. The clause reduces the risk of impermissible or potentially foreign-linked donations entering the electoral system via routes that are unverifiable. Given the wider context of foreign interference concerns, we believe it is right to take this preventive step. Sixteen and 17-year-olds will still be able to donate like any other eligible voter, enabling early registration while ensuring that the political finance system is safeguarded from impermissible donations as younger voters become active participants in our democracy. I commend clause 59 to the Committee.

Clause 60 - Donations by companies and LLPs etc

Lisa Smart (Liberal Democrat, Hazel Grove)

I beg to move amendment 34, in clause 60, page 72, line 36, at end insert—

“(c) the person has nominated a director or partner who is to be personally responsible for ensuring the donation is made in accordance with the requirements of this Part.”

This amendment provides that for donors from corporate bodies to be permissible they must nominate a director or partner who is responsible for compliance with the legal requirements relating to donations.

Rosena Allin-Khan (Labour, Tooting)

With this it will be convenient to discuss the following:

Amendment 35, in clause 60, page 73, line 8, at end insert—

“( ) After section 54D (inserted by section 58 of this Act) insert—

‘54ZE Criminal liability of nominated director or partner to follow requirements

(1) A director or partner nominated by virtue of section 54(3ZA)(c) commits an offence if without reasonable excuse they cause or permit a breach of any requirement imposed under this Part.

(2) A person guilty of an offence under this section is liable—

(a) on conviction on indictment, to imprisonment for a term not exceeding 3 years or to a fine, or to both;

(b) on summary conviction in England and Wales, to imprisonment for a term not exceeding 3 years or to a fine not exceeding £500,000, or to both.’”

This amendment provides that the director or partner who has been nominated to be responsible for ensuring compliance with the legal requirements relating to donations commits an offence if they cause or permit a breach of those requirements without reasonable excuse.

Amendment 36, in clause 60, page 77, line 14, after “party” insert

“, any other party, regulated donee (within the meaning of Schedule 7) or candidate (see Schedule 2A to the Representation of the People Act 1983)”.

This amendment would ensure that the amount a company or limited liability partnership can donate to a party must take into account any donations it has already made to other parties, regulated donees (which includes members of parties, members associations and holders of elective offices) or electoral candidates.

Amendment 37, in clause 60, page 77, line 28, after “party” insert

“, any other party, regulated donee (within the meaning of Schedule 7) or candidate (see Schedule 2A to the Representation of the People Act 1983)”.

This amendment would ensure that the amount a company or limited liability partnership can donate to a party must take into account any donations it has already made to other parties, regulated donees (which includes members of parties, members associations and holders of elective offices) or electoral candidates.

Clause stand part.

Lisa Smart (Liberal Democrat, Hazel Grove)

Before I speak to the amendments, I should say that I welcome clause 60, but I do not support new clauses 13, 32 or 52. The overall thrust of these provisions is that the UK is one of the only countries that still allows donations by companies, and I would be interested to hear from the Minister whether she and her colleagues gave any consideration to putting a stop to that altogether.

Amendments 34 to 37 are, again, in the name of the Chair of the JCNSS, the hon. Member for Warwick and Leamington. The Committee’s report identified a need for tighter rules on corporate donations. That includes ensuring that proportionate civil and criminal sanctions can be targeted at those who deliberately engage in wrongdoing.

Amendment 34 would ensure that corporate donors must nominate a director or partner who would be responsible for complying with the legal requirements. Otherwise, the JCNSS fears that there is a risk of inadequate deterrence if accountability can be attributed to a complex corporate structure. The amendment would help to enable the Electoral Commission and law enforcement to hold specific individuals to account for wrongdoing.

Amendment 35 is a linked amendment, and specifies that the responsible director or partner would be criminally liable for breaching political finance rules. To ensure appropriate deterrence, it would raise the penalties from 12 months to three years in prison. Those higher sentences would also enable law enforcement to make use of more extensive investigatory powers when examining potential wrongdoing. The National Crime Agency said that the use of many investigatory tools is curtailed by the fact that sentences are only 12 months.

On amendments 36 and 37, the JCNSS report highlighted a potential Bill loophole relating to corporate donation limits. The Committee supported the Government’s proposal of limiting donations in line with the amount of revenue generated in the UK, but the report highlighted assessments from the Electoral Commission that the upper limit appears to apply to the individual recipients of donations, rather than to the individual company. That suggests that a company could donate its upper limit to a political party and then donate the upper limit hundreds of times over to individual MPs and regulated entities—for example, candidates. The Committee concluded that this unlimited limit is the wrong policy choice and a major issue with the Bill’s drafting. It seeks to fix that loophole with the amendments.

Samantha Dixon (Labour, Chester North and Neston)

I will speak first to clause 60, before addressing the amendments tabled by hon. Members.

Clause 60 directly responds to long-standing concerns about vulnerabilities in the current political finance system and about the risk of illicit foreign money influencing UK democracy. Under the current framework, it is possible for shell companies or companies with weak UK connections to be used to channel money into our political system. The Electoral Commission and many other stakeholders have consistently called for stronger safeguards to ensure that only legitimate entities can donate.

The new tests will require companies and limited liability partnerships wishing to donate to registered political parties to meet stricter criteria to show a genuine UK connection. The company must have generated enough income in the previous three calendar years to justify its donation. That will help to prevent shell companies from being used as fronts for foreign money. Additionally, companies must meet strict criteria related to control. They will need to be headquartered in the UK, and the majority of persons with significant control must be UK electors or UK citizens. That will ensure UK electoral control and prevent foreign influence. To prevent companies from being set up solely to make political donations, donors must have at least one up-to-date set of accounts filed with Companies House.

Those measures create clearer, more robust tests so that legitimate UK businesses that are genuinely rooted in, and accountable to, the UK can continue to participate, while avenues for abuse by foreign actors or opaque networks are blocked. By tightening the rules and increasing transparency, we are delivering a modern, resilient political finance system fit for the future. As colleagues are aware, the recently published Rycroft review made recommendations to amend these proposals; I am carefully considering those recommendations and will issue a response in due course. Where relevant, we will bring forward amendments to the Bill.

I turn now to amendments 34 and 35, tabled by my hon. Friend the Member for Warwick and Leamington. I note the related letter he shared with the Bill Committee, as well as the Joint Committee on the National Security Strategy report and its recommendations, and I believe that this response should cover the issues he has flagged. Amendments 34 and 35 would require companies or limited liability partnerships to nominate a director or partner to be personally responsible for ensuring that a donation is made in accordance with the rules, and would place criminal liability on that person if the rules are breached.

The Government are obviously in favour of strong requirements around company donations and their enforcement, including discouraging anyone from intentionally or unintentionally breaking these rules. Furthermore, if political donation laws are breached, there should be a clear path of liability. Currently, the law states that that liability ultimately sits with the regulated entities receiving the donation, meaning that it sits with the political party, the candidate and so on.

In the case of a political party, for example, if a donation is knowingly accepted from an impermissible source, the offence is committed by the party and its treasurer, not the donor. The party treasurer is legally responsible for taking all reasonable steps to check whether a donation is permissible, and for returning impermissible donations within the statutory timeframe. The Electoral Commission’s guidance also states that maintaining systems to asses permissibility and keeping records of the checks they perform are core treasurer responsibilities. If the treasurer fails in any of those duties, that can result in enforcement action by the Electoral Commission. That can result in civil sanctions, and more serious offences can be referred to the police and the Crown Prosecution Service for criminal prosecution.

Placing liability on a nominated person in a company or LLP targets the wrong person. The law primarily places obligations on recipients: they are the political actors who know the rules of the game, who must ensure that donations are lawful and who will be held accountable when those rules are not followed. The Government believe that the amendments are likely to deter legitimate donations. Of course, if a company or LLP deliberately gave false information about its permissibility as a donor, it would be guilty of an offence, and any director, manager, secretary or other similar officer would also be guilty of an offence if they had consented to such action or it was attributable to their negligence.

Although the amendments go a step too far, the Government intend to commence existing provisions in primary legislation that will require donors to declare any benefits or sources of funding connected to their donation, and will render them liable for criminal prosecution for false declarations. Additionally, the introduction of “know your donor” requirements, combined with increased enforcement powers for the Electoral Commission and enforceable declarations, will make it significantly more difficult for malign actors to exploit the system undetected. It is crucial that political parties and other recipients of political donations remain able to fund themselves, and these measures will equip them with the right tools to detect and manage the risks of foreign interference. With those reassurances, I hope that Members will not press the amendments.

Amendments 36 and 37, which the hon. Member for Hazel Grove spoke to, seek to require a registered political party, when determining whether a company or LLP meets the revenue test under clause 60, to aggregate all donations made by that company or LLP to any registered political party, regulated donee or candidate. These amendments cut across the approach we have taken in clause 60. Our approach leverages the existing transparency provided by company law and allows recipients to make donations based on information that companies and LLPs are already required to disclose. That avoids creating additional, unnecessary burdens.

However, we are introducing new and significant obligations on parties through the “know your donor” regime, where recipients of significant donations from companies will also need to conduct a risk assessment to consider the likelihood of foreign or illicit sources of funding. In addition, through secondary legislation, we will commence the legislation that requires donors to declare any benefits linked to their donation, further improving transparency around the true source of funds. We are also introducing stringent eligibility criteria for companies and LLPs wishing to make political donations. Companies will not only need to demonstrate their legitimate business activity through accounts of revenue, but will need to be headquartered in the UK and be majority owned or controlled by UK electors or citizens.

Together, those three tests provide a far more robust framework to ensure that only companies with a legitimate and demonstrable connection to the UK are able to influence UK politics. These measures work together to close loopholes and strengthen rules at all stages in the political donations process, providing stronger safeguards against malign foreign actors who seek to undermine our democracy. As part of his review, Philip Rycroft has made recommendations in this space. We are considering them carefully, and we will revert with a full Government response and consider any amendments to the Bill as a result.

Desmond Swayne (Conservative, New Forest West)

Good afternoon. Will Members please ensure that all electronic devices are switched to silent or switched off? We will now continue line-by-line scrutiny. The selection list for today’s sitting is available in the room and on the parliamentary website, and shows the clauses, schedules and amendments that have been grouped for debate. I remind Members who have put their name to the lead amendment in a group that they will be called first. In the case of a stand part debate, the Minister will be called first. Other Members are then free to indicate, by standing in their place, that they wish to speak.

At the end of a debate, I shall call the Member who moved the lead amendment, new clause or new schedule again, and they will need to indicate whether they wish to withdraw it or press it to a decision. If a Member wishes to press other provisions in any group to a vote, including new clauses and new schedules, they need to let me know. The order of decisions follows the order in which the amendments appear in the amendment paper. I hope that is helpful.

Desmond Swayne (Conservative, New Forest West)

I remind the Committee that with this we are discussing the following:

Amendment 35, in clause 60, page 73, line 8, at end insert—

“( ) After section 54D (inserted by section 58 of this Act) insert—

‘54ZE Criminal liability of nominated director or partner to follow requirements

(1) A director or partner nominated by virtue of section 54(3ZA)(c) commits an offence if without reasonable excuse they cause or permit a breach of any requirement imposed under this Part.

(2) A person guilty of an offence under this section is liable—

(a) on conviction on indictment, to imprisonment for a term not exceeding 3 years or to a fine, or to both;

(b) on summary conviction in England and Wales, to imprisonment for a term not exceeding 3 years or to a fine not exceeding £500,000, or to both.’”

This amendment provides that the director or partner who has been nominated to be responsible for ensuring compliance with the legal requirements relating to donations commits an offence if they cause or permit a breach of those requirements without reasonable excuse.

Amendment 36, in clause 60, page 77, line 14, after “party” insert

“, any other party, regulated donee (within the meaning of Schedule 7) or candidate (see Schedule 2A to the Representation of the People Act 1983)”.

This amendment would ensure that the amount a company or limited liability partnership can donate to a party must take into account any donations it has already made to other parties, regulated donees (which includes members of parties, members associations and holders of elective offices) or electoral candidates.

Amendment 37, in clause 60, page 77, line 28, after “party” insert

“, any other party, regulated donee (within the meaning of Schedule 7) or candidate (see Schedule 2A to the Representation of the People Act 1983)”.

This amendment would ensure that the amount a company or limited liability partnership can donate to a party must take into account any donations it has already made to other parties, regulated donees (which includes members of parties, members associations and holders of elective offices) or electoral candidates.

Clause stand part.

Paul Holmes (Conservative, Hamble Valley)

It is a pleasure to serve under your chairmanship, Sir Desmond. This is the first time we have met in this Committee, but I know you like good order, so I will be brief.

Lisa Smart (Liberal Democrat, Hazel Grove)

Hear, hear!

Paul Holmes (Conservative, Hamble Valley)

That is the only time the Liberal Democrats have ever cheered me on, so I am glad we are in agreement.

The Minister gave a comprehensive outline of the proposals in clause 60. I will briefly talk to amendment 34, which was tabled by the hon. Member for Warwick and Leamington (Matt Western) but moved by the hon. Member for Hazel Grove. The Conservatives think the amendment is well intentioned, but one of my big concerns—I think the Minister outlined this, but perhaps she will return to it in winding up—is the burden that would be placed on businesses, which already have quite extensive regulatory burdens placed on them by Government. I think all parties in this Committee have intimated that everybody wants more transparency and wants to talk more about donations to ensure that we really tighten up the regulatory regime on political party donations. However, although I am not averse to being radical, I think amendment 34 is probably a bit over-burdensome and we do not support it, but we are content to support clause 60.

Ellie Chowns (Green, North Herefordshire)

It is a pleasure to speak under your chairship, Sir Desmond. In clause 60, we are considering company donations in UK politics, and I ask the Minister to consider outright banning them, as happens, for example, in France and Canada. There is no real reason for companies to be permitted to make donations, particularly when we are concerned, as in this Bill, with ensuring that company donations are not a mechanism for channelling funds from outside the country into British politics. Why not make the situation clear and allow only individuals, whose connection to the country can be clearly tested, to donate? Company donations have been nearly half the size of individual donations in UK politics in recent years. These are really significant sums.

Lewis Cocking (Conservative, Broxbourne)

The hon. Member is speaking about company donations. I am not saying I agree with this, but does she feel that the same logic should apply to trade union donations? If she feels that companies cannot donate, does she still feel that trade unions can?

Ellie Chowns (Green, North Herefordshire)

I consider companies and trade unions to be completely different entities. One is a profit-making organisation, and the other is a membership association designed to represent the interests of its members. The two are not parallel, and I am completely fine with trade unions making donations.

Company donations have a huge influence on our politics. There is also a tax advantage for companies; there is effectively a taxpayer subsidy to them, and the advantage can be up to about 40% for companies making donations from company funds, compared with individual funds. I would therefore like to hear why the Minister thinks it is important to retain the ability for companies to make donations and does not want to follow the example of France and Canada in stopping such donations. Individuals can still make donations.

On a couple of specific points, the hon. Member for Hazel Grove referenced the fact that there is a clear problem in the Bill as currently drafted. A loophole permits companies to give donations up to the limit multiple times, both to a party and potentially to every single one of its candidates. Surely the limit should be set so that it reflects the total value of donations to all recipients. That has been argued for by the Electoral Commission and in Philip Rycroft’s recommendation 4, and it is also covered by amendments 36 and 37 in the name of the hon. Member for Warwick and Leamington.

It is also clear that the test should be post-tax profit, not revenue. It is far too easy for companies to inflate their revenues by engaging in what is sometimes called transfer pricing in other sectors, effectively enabling them to completely bypass the intended restrictions. Surely it is in the spirit of the Bill, and should therefore be put into the letter of it, that the test should be post-tax profit, not revenue. If we are going to permit company donations, we should be really clear that they are derived from profit made in-country, because using the revenue test provides a huge loophole. Again, that is called for in Philip Rycroft’s recommendation 2, and by the Electoral Commission and many others, so I very much hope the Minister will respond positively.

Amendments 34 and 35, in the name of the hon. Member for Warwick and Leamington, would make the donor criminally liable. The Minister responded by saying that the onus should all be on the recipient of those donations, but that is not how the law operates in other areas when it is broken: the commissioners of the offence, as well as the recipient of the funding, are guilty. So I ask the Minister to think again. If we are talking about large companies making huge donations, they arguably have greater capacity, and certainly just as much responsibility, as the recipient to check that they are operating within the law. I refer the Minister to my comments on a previous clause about establishing a donor register, which would enable us to deal with these issues and involve the Electoral Commission in ensuring that these checks are in place.

I will briefly touch on new clause 13, in the name of the hon. Member for North East Hertfordshire (Chris Hinchliff), new clause 32, in the name of the hon. Member for Poole (Neil Duncan-Jordan), and new clause 52, in the name of the hon. Member for Leeds East (Richard Burgon). They all recognise the widespread concern in UK politics, and among all of us to some extent, about how company donations risk twisting, and in some cases have twisted, our politics. Each of those Members has tabled a new clause seeking to ban donations from particular categories of company donor. The first seeks to exclude property development and construction undertakings, the second seeks to exclude those who have had public contracts at any time in the last 10 years, and the third seeks to exclude any companies involved in oil and gas extraction.

I have huge sympathy for the arguments and for the broad thrust of those new clauses. I am not necessarily convinced that, in their current form, they are ready to be incorporated in the Bill, but they highlight a key concern. For example, there has been widespread concern about cases where large donations by a property developer were associated with planning decisions under a previous Government that went in favour of that property developer. There have also been serious concerns about the revolving door between the Government and the legislature, and profit-making companies. I would really like to hear the Minister’s response to those three new clauses tabled by Labour Members, which highlight concerns about the influence of particular groups of companies on our politics.

However, the issues I really hope the Minister will respond to are, first, stopping all company donations, because people who want to make donations can still make them as individuals; secondly, adopting the post-tax profits test, rather than the revenue test; and, finally, ensuring that the donations limit applies to the total value of donations, not just single donations.

Lloyd Hatton (Labour, South Dorset)

I will keep my remarks brief. As we start the afternoon sitting, it is worth putting on the record that clause 60 goes a significant distance towards finally tightening up the rules around corporate donations, which many campaigners, including in civil society, would argue have been left unaddressed for far too long. What clause 60 seeks to do is effective.

That said, and I will not repeat in too much detail the points made by the hon. Member for North Herefordshire, it is worth reflecting on the recommendations in Philip Rycroft’s review around revenue versus profits, and how we can tighten things up. So I am keen to understand how, as the Bill progresses, we can potentially take his recommendations into account.

It is worth remembering some of the big case studies that have been a cause for concern. We therefore know that, in some cases, corporate donations can carry a significant risk of nefarious interference in the democratic process. There was much media coverage and speculation about the idea that Elon Musk, the California-based billionaire, could legitimately make a donation to a UK political party via a UK subsidiary of Tesla.

When we look at some of the research conducted by CenTax or Transparency International, we see that around £1 in every £10 that comes via a company as a donation could be because the individual in question could not donate directly themselves. According to that same research, around a quarter of money donated by companies is completely untraceable. So these measures are really welcome.

Paul Holmes (Conservative, Hamble Valley)

I do not disagree with what the hon. Gentleman is saying; I think he is well intentioned, and his speech is well researched. However, as set out in the House of Commons Library note, the Electoral Commission itself has warned that the provisions in the clause

“would not reduce the risk of foreign money entering British politics through companies”.

What does he say to that? Does he think the Government should do more?

Lloyd Hatton (Labour, South Dorset)

I think there is a difference between corporate and non-corporate donations. However, what would be really interesting is to see how the Bill progresses in taking forward the Rycroft review. That is a really important point, but I will not go over it again, because it has already been well articulated by the hon. Member for North Herefordshire.

To conclude, the Bill takes serious steps forward in addressing some of the foul play we have seen time and again with corporate donations in the past, and there is a huge body of evidence behind that. However, I would welcome any early advice or opinion the Minister can give us on how we can work on the recommendations set out by Philip Rycroft.

Samantha Dixon (Labour, Chester North and Neston)

It is a pleasure to serve under your chairmanship, Sir Desmond. I will be guided by you, but I do not intend to speak to new clauses 13, 32 and 52 at this stage. However, to respond to a number of points made during the debate, particularly by the hon. Member for North Herefordshire—

Desmond Swayne (Conservative, New Forest West)

Just for clarity, if you wish to speak to those new clauses, your only opportunity to do so is now.

Samantha Dixon (Labour, Chester North and Neston)

In the interests of time, I will continue.

On the other remarks made by the hon. Member for North Herefordshire, I hear her point about profit and revenue, and it is highlighted in the Rycroft review. As I said many times this morning, we will carefully consider the Rycroft review and respond to it appropriately.

The hon. Members for North Herefordshire and for Hazel Grove both highlighted the Government’s view that the responsibility rests with the donor. The Government strongly believe that. The onus is on the person or organisation receiving the donation to consider its origins very carefully. They can and should decline donations if they cannot satisfy themselves that those have come through the proper and legitimate channels.

Let me turn to the issue of why we should not ban donations from companies altogether. Political parties and other campaigners will remain able to raise sufficient funds because they need to communicate their views to the electorate about protecting our democracy better against those who seek to covertly undermine it. The hon. Member for North Herefordshire referenced the Canadian model. I have had the pleasure of meeting the Leader of the House from Canada. While it is tempting to suggest that there should be a ban on corporate donations, I remind the hon. Lady that 60% of their political campaigning is funded by the taxpayer—and it is a brave politician who would enter that particular plea to the British electorate at this time.

Ellie Chowns (Green, North Herefordshire)

I thank the Minister for her engagement with my point. In UK politics, about 22% of donations into politics over the past few years have been from companies. We are not talking about requiring the Government to step in and put 60% of the funding into politics; we are talking about the risks associated with a specific form of donation.

Under the measures the Government is putting forward in clause 60, we are putting in place requirements to ensure that persons of significant control are clearly allowable donors. However, it is possible for a company to restructure so that it just goes underneath that and does not meet the 25% threshold. So that could still be a channel for illicit or foreign funding to come into British politics. Would it not be simpler to require any persons who have significant control in a company and who wish to make political donations to make them as individuals?

Desmond Swayne (Conservative, New Forest West)

This is a very long intervention.

Ellie Chowns (Green, North Herefordshire)

I do apologise, Sir Desmond. I think I have made my point.

Samantha Dixon (Labour, Chester North and Neston)

The hon. Member has made her point. The Government believe that there is a place for company donations from UK companies. We just feel that we should be much stricter about the arrangements by which they do these things. We have set that out in the legislation, which is what we are discussing this afternoon.

Turning briefly to the points raised by my hon. Friend the Member for South Dorset, I remind all Members that these measures are not designed to prevent a specific individual or company from donating. Those who follow and meet the three tests and successfully meet the “know your donor” and section 54A requirements should be able to enrich our democracy by donating as they do. I therefore commend clause 60 to the Committee—

Ellie Chowns (Green, North Herefordshire)

I apologise, but I have not heard the Minister respond to the point that I and the hon. Member for Hazel Grove made about donations being counted cumulatively, which is also one of the Rycroft recommendations.

Samantha Dixon (Labour, Chester North and Neston)

We will consider those points. The Rycroft recommendations are being considered very carefully. We will respond to them in due course and we will come back to Parliament with our recommendations as they come forward. I hope that gives the hon. Lady the assurance she is seeking.

Lisa Smart (Liberal Democrat, Hazel Grove)

We have had a good discussion of the amendments that I spoke to on behalf of the Chair of the JCNSS, the hon. Member for Warwick and Leamington. I do not feel a desire in the room to move to a Division, so I beg to ask leave to withdraw the amendment.

Clause 61 - Forfeiture of certain donations to registered parties etc

Samantha Dixon (Labour, Chester North and Neston)

This clause strengthens the electoral regime by restoring a clear, objective test for forfeiture: if an individual donor was not actually on an electoral register at the time of the donation, the donation is impermissible and liable to forfeiture. It responds directly to long-standing concerns from the Electoral Commission that the current framework is open to inconsistency. In particular, the 2010 Supreme Court ruling, which allowed courts to consider whether a donor was eligible, rather than actually registered, when assessing impermissible donations and their forfeiture, introduced uncertainty and risked discouraging thorough permissibility checks by campaigners.

The clause removes the ambiguity in electoral law, ensuring that permissibility of an individual is determined on actual electoral registration. It reinstates a simple and objective test that supports consistent enforcement and reinforces the integrity of the electoral regime. Campaigners already must take reasonable steps to verify donor permissibility. The clause simply removes the scope for subjective interpretation of permissibility and strengthens deterrence by ensuring that impermissible donations cannot be retained by campaigners due to ambiguity in the law. By reinforcing the principle that only permissible donors may fund UK politics, the clause provides a clear deterrent for impermissible donations and supports compliance by political parties and campaigners.

Paul Holmes (Conservative, Hamble Valley)

I welcome the Minister’s comments on the clause. It is important that when we have been discussing the nature of this legislation, particularly regarding donations, we have outlined a clear stance that if people want to participate in our political process and make donations, they should have a physical stake in it. Any removal of the ambiguity around campaigners having to look to see whether it is permissible is welcome. It is a reasonable expectation from the Government that there has to be some level of participatory engagement in the political process. We have no problem with the clause; indeed we support it.

Clause 62 - Unincorporated associations making political contributions

Ellie Chowns (Green, North Herefordshire)

I beg to move amendment 88, in clause 62, page 83, line 17, leave out “£11,180” and insert “£500”.

This amendment, together with Amendments 89 to 94, would bring the reporting threshold for donations from Unincorporated Associations in line with the permissibility threshold for donations to political parties.

Desmond Swayne (Conservative, New Forest West)

With this it will be convenient to discuss the following:

Amendment 89, in clause 62, page 83, line 26, leave out “£2,230” and insert “£500”.

See explanatory statement for Amendment 88.

Government amendment 79.

Clause stand part.

Amendment 90, in schedule 9, page 165, line 23, leave out “£11,180” and insert “£500”.

See explanatory statement for Amendment 88.

Amendment 91, in schedule 9, page 165, line 25, at end insert—

“1A For sub-paragraph (1) substitute—

(1) Where in any calendar year an unincorporated association falling within section 54(2)(h) makes a political contribution of more than £500, not having previously made any political contributions in that year, the association must notify the Commission accordingly within the period of 30 days beginning with the date on which the contribution was made.”

See explanatory statement for Amendment 88.

Amendment 92, in schedule 9, page 165, line 26, leave out sub-paragraph (2).

See explanatory statement for Amendment 88.

Government amendments 80 to 84.

Amendment 93, in schedule 9, page 170, line 26, leave out “£2,230” and insert “£500”.

See explanatory statement for Amendment 88.

Amendment 94, in schedule 9, page 170, line 26, at end insert—

“(aa) omit sub-paragraph (5)”.

See explanatory statement for Amendment 88.

Government amendments 85 to 87.

Schedule 9.

Ellie Chowns (Green, North Herefordshire)

The clause contains the welcome measure of preventing donations from impermissible donors being made through the mechanism of unincorporated associations and reducing the level at which they have to register with the Electoral Commission and report gifts. That is very positive. The current situation really cannot continue, so I am pleased that, through these measures, the Government will try to manage and block malicious interference and ensure democratic safety.

Although unincorporated associations are used legitimately by some, they can be an opaque vehicle for funds of unknown origin, so there is potential for them to be used to introduce foreign interference in our political system. Interesting Transparency International research published last year found that, of the £40.4 million in donations made by unincorporated associations since 2010, a huge £38.6 million was unaccounted for. More than 95% of donations from unincorporated associations came from those that have not reported the source of their income, so it is clearly time for change Despite those concerning statistics, the previous Government increased reporting thresholds for unincorporated associations in the Elections Act 2022, so I am very glad that this Government are reversing that decision through the Bill.

Under normal regulations, donations to political parties must come from a permissible source if they are over £500, but if the donations are made by an unincorporated association, even with the lower threshold, the reporting requirements are not triggered until donations reach over £11,180 in a calendar year. Even with the new rules, it is possible for an unincorporated association that does not meet the threshold and is therefore not required to register to make donations without any checks. That is clearly an undesirable and unnecessary loophole, so I support the amendments that have been tabled by the hon. Member for Rochester and Strood (Lauren Edwards), which aim to close this loophole, and I urge the Minister to consider reducing the permissibility threshold for unincorporated associations to £500, equal to the permissibility threshold for other sources of donation.

Samantha Dixon (Labour, Chester North and Neston)

I will speak now to clause 62 and Government amendments 79 to 87, which were tabled in my name. I will come to the other amendments later.

The clause introduces measures that have long been called for by the Electoral Commission, the National Crime Agency and the Committee on Standards in Public Life, which is now known as the Ethics and Integrity Commission, to tighten the rules around unincorporated associations. Under the current framework, unincorporated associations are permitted to make political contributions provided their main office and activities are based in the UK, but there are no restrictions on the sources of the funds behind those contributions. Existing rules therefore do not provide sufficient transparency or assurance about who is ultimately funding the political contributions made through such bodies.

The clause introduces a strengthened framework to ensure that political contributions from unincorporated associations come from permissible sources and are subject to stricter and more consistent transparency requirements. The clause lowers the thresholds at which UAs must register with the Electoral Commission and report the gifts they receive, ensuring that significant contributors provide the same level of transparency as other regulated campaigners. It also extends transparency rules so that contributions to candidates count towards the registration threshold, and it requires UAs to appoint a responsible person, improving clarity about who stands behind such associations.

Finally, clause 62 introduces new controls to ensure that funds used for political contributions come from permissible sources. UAs will be required to verify political gifts they rely on, and they will be prohibited from using unverifiable or impermissible funds for political activity. I commend clause 62 to the Committee.

Government amendments 79 to 87 further strengthen the rules that we have introduced for unincorporated associations, with the intention of preventing the circumvention of controls on political donations. First, we will prevent one UA from making political gifts to another, thereby addressing the risk of avoidance through the use of chains of UAs. Provision is being made to modify the meaning of “exempt trust donations” so that trusts created before the tabling of amendment 84 can be treated as donations from permissible donors, ensuring that legitimate historic arrangements are not disrupted, while preventing the creation of new trusts designed to exploit the system and avoid the strengthening safeguards introduced by the Bill.

We have also introduced targeted criminal offences. A person will commit an offence if they knowingly provide false information, or deliberately withhold material information with intent to deceive, about a gift that they believe may be used by an association to make a political contribution. Those are aimed squarely at deliberate misconduct, rather than inadvertent or technical errors, and the penalties align with existing similar offences in electoral law.

Finally, these amendments also clarify provisions in the Bill relating to responsible persons for UAs. Where a UA already has an individual fulfilling this role, these amendments make it clear that there is no requirement for a new appointment to be made, but the commission must still be notified that the person is continuing in that role, and the responsible person must confirm that they are willing to continue as such.

Overall, these measures ensure that the significant tightening of rules around UAs operates effectively. They form an important part of the Bill’s wider purpose of strengthening the integrity, transparency and resilience of the UK’s political finance regime, and I urge Members to accept the amendments.

I thank my hon. Friend the Member for Rochester and Strood for tabling amendments 88 to 94, and the hon. Member for North Herefordshire for raising them during this debate. There are concerns about transparency around UAs, and the risk that these structures could be used to obscure the true source of political contributions. The amendments would reduce the threshold at which UAs need to register with the Electoral Commission, and the threshold at which gifts are required to be reported. They would replace the Bill’s notification threshold of £11,180 and reporting threshold of £2,230 with £500, and they would require notification once an association makes political contributions over £500 in a calendar year.

The Government agree with the underlying principle that this area needed strengthening. Under the existing framework, UAs can make political contributions if their main office and activities are UK-based, but there are not restrictions on the sources of the funds behind those contributions. That is a real vulnerability in the wider political finance system. Clause 62 and schedule 9 are intended to deliver a major strengthening of the rules. Under the Bill, associations making significant political contributions will have to register with the Electoral Commission at an earlier point and, for the first time, publicly identify a named responsible person, who is legally accountable for compliance with electoral law.

The Bill’s package is not just about registration; schedule 9 will also prevent unincorporated associations from using gifts from impermissible donors for political contributions. It lowers the gift reporting threshold from £11,180 to £2,230, and it requires associations that want to make political contributions over £11,180 to check that the money they are using comes from permissible UK sources in a similar way as political parties and other regulated campaigners are required to do.

We are already tightening the regime in a way that is proportionate and targeted at the point of greatest risk. The question is whether we should push the whole framework down to £500; the Government’s view is that we should not. Our approach across political finance has been risk-based. We focus the strongest requirements where the risks are highest and we keep the system workable so that regulators and campaigners can concentrate their time and effort where it matters most. Moving the thresholds to £500 would create a large volume of low-value notifications and reporting. That would divert the time and energy of associations, recipients and the regulator on to lower-risk activity at the expense of the higher-risk checks we are introducing for significant contributions.

For those reasons, the Government believe that the Bill already strikes the right balance of stronger transparency and accountability where UAs engage in significant political financing, without imposing disproportionate burdens on low-risk activity. I therefore invite the hon. Member to withdraw the amendment.

Paul Holmes (Conservative, Hamble Valley)

I thank the Minister for her remarks. Once again, I would like to say on the record that the Government are making great strides in this area and are trying to strengthen the legislation and the regulatory regime around donations. We agree with her that the amendments—particularly amendment 88—for the reduction to £500 on the reporting threshold for donations from unincorporated associations is simply too low. There could be a debate on whether it should be lowered from what the Government are proposing; I think actually unifying the regulations between companies and unincorporated associations is a sensible thing to do. It removes ambiguity and creates a more uniform system. The burden placed at £500 would create an unnecessary reporting regime.

Lloyd Hatton (Labour, South Dorset)

It has already been outlined by the hon. Member for North Herefordshire, but I am interested to know whether the official Opposition spokesperson agrees that the previous Government’s decision in the Elections Act 2022 to inexplicably increase the threshold for UAs was wrong, and that the intention of this Bill, which is to reduce it, is the right way forward?

Paul Holmes (Conservative, Hamble Valley)

I have already said that I think the Government are being sensible in creating a unified or level playing field between companies and unincorporated associations. I was not an expert on the previous Act when it was passed, but in my view it is sensible for the Government to be taking this action, now that its consequences are clear, because the Act obviously did not work. If Members across the House look at some of my previous remarks on some of the proposals brought forward by the last Government, I am not ashamed to say that sometimes—I only say sometimes—we got it wrong. That is the nature of democracy.

The changes that the Government are making are sensible and my contention is that some of the amendments—especially amendments 88 and 90—use a sledgehammer to crack a nut. They create an overburden compared with the Government’s good intentions and what they want to get out of the proposals.

We would not support amendment 88 and we certainly would not support amendment 90, but we do welcome the strides that the Government, and the Minister, are trying to take in tightening up the regime.

Ellie Chowns (Green, North Herefordshire)

I beg to ask leave to withdraw the amendment.

Schedule 9 - UNINCORPORATED ASSOCIATIONS MAKING POLITICAL CONTRIBUTIONS

Clause 63 - Electronic material promoted by third parties

Desmond Swayne (Conservative, New Forest West)

With this it will be convenient to discuss the following:

Clause 64 stand part.

Samantha Dixon (Labour, Chester North and Neston)

Any campaigner wishing to influence the electorate should be prepared to be transparent. Imprint rules play an important role in upholding trust in UK democratic processes by ensuring that voters can see clearly who is behind political campaigning material. Under existing rules, third-party campaigners who spend under a certain threshold are not required to include imprints on their organic digital campaigning material. That creates a loophole allows third-party campaigning groups to disseminate potentially influential content without disclosing its origin, which is concerning when such material is designed to be shared virally, especially if the material is misleading, controversial or intended to manipulate public opinion without accountability.

Clause 63 strengthens the transparency of digital imprint rules by ensuring that third-party campaigning groups spending under a certain threshold are also required to include imprints on their organic digital campaigning material. This requirement will ensure that the rules promote transparency and public trust, while protecting free expression and avoiding undue burdens on individuals simply expressing their political opinions online.

Following consultation with the Scottish Government, it was agreed that applying a single UK-wide regime uniformly will enable voters from across the UK to benefit from a level of transparency and will avoid confusion. The clause therefore also repeals part 8 of the Scottish Elections (Representation and Reform) Act 2025 consequentially upon the extension of the UK-wide digital imprint regime.

Turning to clause 64, it is important that campaigners have access to clear and up-to-date guidelines. The Electoral Commission’s guidance on digital imprints plays an important role in helping campaigners to understand and comply with the rules and supports enforcement authorities in maintaining transparency and public trust in UK democratic processes.

Under the existing framework, even minor corrective updates to guidance require Secretary of State approval and a 40-day parliamentary procedure that can delay publication and result in guidance quickly becoming outdated. That problem is particularly acute in the rapidly evolving digital environment, where changes to social media platforms and new campaigning technologies can make guidance inaccurate or confusing for regulated entities.

Clause 64 amends section 54 of the Elections Act 2022 to enable the Electoral Commission to make minor corrective changes, such as updating platform names or fixing broken hyperlinks, without requiring the approval of the Secretary of State and Parliament. That will allow the commission to issue timely and accurate guidance, ensuring that regulated entities benefit from clear, up-to-date guidance, while retaining ministerial and parliamentary oversight for substantive changes, such as those involving changes of interpretation or scope.

Paul Holmes (Conservative, Hamble Valley)

Does anyone on the Committee intend to speak to new clauses 10 or 24?

Ellie Chowns (Green, North Herefordshire)

indicated assent.

Paul Holmes (Conservative, Hamble Valley)

In that case, I reserve my right to speak until after the hon. Member for North Herefordshire.

Ellie Chowns (Green, North Herefordshire)

I will speak to new clauses 10, 24, 25, 27 and 28—I will rattle through them. First, new clause 10—tabled by the hon. Member for Milton Keynes Central (Emily Darlington), whom I thank for her work on this—relates to guidance on the law regarding digital communication offences in relation to elections. We need this clause and, although it is more complex, one word explains why: deepfakes. This new clause is, to a significant degree, about deepfakes.

Tackling deepfakes is complex, but we can take practical steps now to modernise election law and improve our ability to regulate in this area. Both the Electoral Commission and the Crown Prosecution Service have highlighted the need for clearer guidance on whether deepfakes fall within existing election offences. Unfortunately, the law on digital election offences is currently unclear. That uncertainty creates confusion for candidates, platforms and law enforcement, weakens democratic protections and leads to inconsistent enforcement.

New clause 10 would require the Government to address that gap by publishing clear guidance within 12 months of the Bill’s passage, setting out how digital communication offences apply during elections, so that expectations are clear and enforcement is consistent. In terms evidence for why this is needed, we all know that deepfakes and manipulated content targeting politicians are already circulating, including outside election periods. Existing laws may technically cover those harms, but their application in digital context remains unclear.

Recent examples include a deepfake video in October last year of a Conservative MP, the hon. Member for Mid Norfolk (George Freeman), which falsely claimed that he had defected. I was part of an event where he explained that, under the Online Safety Act 2023, he could potentially make a complaint about that, but would have to demonstrate that he was psychologically terribly damaged by it. That is not really what this is about—it is politics that is damaged by the proliferation of such material, so we should take our collective responsibility to deal with it very seriously.

In October 2023, a deepfake audio of our current Prime Minister went viral and has repeatedly resurfaced. In Ireland last year, an AI-generated video disrupted a presidential election. Those cases and many others demonstrate the growing risk. Clear guidance is needed to ensure that the law can be effectively applied during election periods. The new clause is very reasonable. It does not require the Government to commit absolutely to something right now; it simply requires the Government to publish guidance to clarify the situation.

The Government, in their response to the Speaker’s Conference report published recently, said:

“The Government recognises that there are potential issues with Section 106 of the Representation of the People Act 1983. We are reviewing how this legislation should apply in a modern electoral setting. Where necessary, we will take appropriate action to clarify the scope of Section 106, particularly to ensure that it captures emerging technologies (such as deepfakes and other AI technologies) and is future-proofed.”

Where better to do that than in this legislation? This is the point when the Government should action the commitment that they have already made.

New clause 24 proposes a repository of digital political advertising. Such advertising plays a key and increasingly central role in election campaigns, but remains significantly less transparent than traditional campaign materials. Voters are often unable to see who is targeting them, how much is being spent or whether messaging is consistent across audiences. Campaigners are able to use targeting on social media platforms, for example, to make very targeted adverts, so that nobody can see what material is going to whom.

That lack of transparency creates real opportunities for misinformation. It undermines trust in the democratic process and leaves the system vulnerable to manipulation by foreign or domestic actors, as well as opaque funding sources. While the Bill, as it stands, makes progress on digital imprints, it does not go far enough to ensure meaningful, real-time transparency.

New clause 24 would address those gaps by requiring the creation of a comprehensive, publicly accessible repository of digital political advertising and strengthening existing disclosure requirements. The reasons for that are well understood. Digital adverts can be micro-targeted to specific groups without wider scrutiny and there is currently no single public record of what ads are being run, by whom, at what scale or with what funding. International evidence, including from elections in the US and Europe—and, I would argue, in the UK—has shown how online political advertising can be exploited to spread disinformation and obscure funding sources.

That issue was addressed by Philip Rycroft in his very useful report; I note that, on page 47, he says:

“Strictly speaking, this issue of advert libraries strays beyond my remit”,

but that he has

“heard enough evidence to suggest that there would be considerable benefit”

from establishing this practice, and he calls on the Government to take action. I welcome that point and very much hope that the Government will consider this new clause, a practical and proportionate transparency measure that would align digital campaigning more with offline political advertising.

New clause 25 relates to the Electoral Commission’s powers to obtain information outside formal investigations. That is something we heard about in oral evidence and Philip Rycroft speaks about it specifically in his recommendations 9 and 10. The regulation of digital campaigning requires timely access to information, especially during very fast-moving election periods. At the moment, the Electoral Commission can effectively gather information from online platforms only through formal investigations, which can be initiated only once there is sufficient evidence of wrongdoing. There is a bit of a chicken-and-egg situation there—a significant gap.

The Commission cannot proactively monitor or respond to emerging risks in real time, including the risk of foreign interference or bot activity—a growing problem that we have seen in previous elections. As election campaigns increasingly take place online, that reduces the effectiveness of enforcement. Philip Rycroft has made a clear case for that change, so I do not need to labour the point. I very much hope that that is one of the recommendations that the Government will take away and come back on, and I would welcome some warm words from the Minister on that.

New clause 27 would require a Government review of regulated periods in relation to elections—again, something addressed in the Rycroft report, which covered the need to ensure that transparency requirements apply year round. Philip Rycroft is clearly seriously concerned about the risk of gaming the system. Currently, because regulation applies only within the regulated period, but expenditure applies during the entire year, there are strong incentives for political actors to front-load expenditure just before the regulated period kicks in. There is huge evidence of that; I have seen it from another party in my own area, with huge chunks of spending coming in just before the regulated period. That is a clear loophole.

Philip Rycroft draws attention to that issue, stating that high spending limits,

“combined with unlimited spending possibilities outwith the regulated period, drives a sort of arms race among political parties and actors to out-raise and out-spend their competitors.”

The net effect is extremely problematic for our politics. He goes on to state:

“Reducing the spending limits and introducing such limits across the whole electoral cycle could potentially relieve some of the fund-raising pressure, in turn diminishing the inducement to look to non-permissible sources to stay ahead.”

Rycroft acknowledges that the issue was beyond his direct remit, but it is useful that his report comments on where issues to do with foreign influence overlap with broader questions about how we regulate finance in our system. He states:

“The issue of spending limits and wider caps is one for the political class as a whole to consider if it wishes to restore confidence in the political process and to keep big money out of UK politics. This might be something that could be usefully debated during the passage of the Representation of the People Bill.”

Indeed—so today is our opportunity to debate it. I am saddened that the Bill, as it stands, does not address the need for year-round spending limits or for caps on overall donations—we will come to that a bit later—but this is the moment when we can and should respond to Philip Rycroft’s call to discuss this issue. I challenge the Minister on this: there is a clear need for regulation outwith the regulated period—for year-round regulation of political expenditure—and I hope that she will address that and take it forward.

Finally, new clause 28, also in the name of the hon. Member for Milton Keynes Central, is essentially about labelling AI-generated material. Just in the past 24 hours we have seen a global controversy over the use of an AI-generated image, posted by a person who shall perhaps remain nameless. It is clear that AI-generated material is widespread in politics. Sometimes it is easily spottable, as in the case I have just referenced, but at other times it may not necessarily be so. Legislation has not yet caught up with that issue. This new clause, like new clause 18 on the same topic, which I suspect the hon. Member for Hazel Grove may speak to shortly, is a much-needed step to improve transparency so that we know when material is produced using AI.

The Electoral Commission briefing raises some questions about the specifics of how the issue is addressed, and makes the point that there is a need for similar approaches to be taken across digital and non-digital formats. I take that point broadly, but I do not think it is beyond the wit of civil servants to come up with a form of words that will address the issue. The use of generative AI has been particularly prevalent in the digital space, so this is a real opportunity for regulation to catch up. I look forward to hearing from the Minister on all these very useful new clauses.

Lisa Smart (Liberal Democrat, Hazel Grove)

I support clauses 63 and 64, and I warmly welcome the comments from my colleague, the hon. Member for North Herefordshire, on new clauses 10, 24, 25, 27 and 28, tabled in the name of the hon. Member for Milton Keynes Central. A number of us who have been concerned with the issues that we are talking about today and which the Bill seeks to address were very pleased to see some of the measures that the Government put in the first draft of the Bill. But we were disappointed by what was not there: the lack of discussion of regulated periods, generative AI deepfakes, and mis and disinformation felt like a missed opportunity. On Second Reading, the Secretary of State spoke of the need to ensure that regulation keeps up with digital reality, and this legislation feels like the opportunity to address some of those issues.

I will not repeat what has just been said, but a number of the new clauses overlap slightly, in trying to fill in the gaps that quite a few of us feel are present in the Bill as drafted. The hon. Member for North Herefordshire and I are pleased to be co-vice chairs of the all-party parliamentary group for fair elections, which is the leading organisation within Parliament campaigning for reforming the electoral system—of which there is no mention in the Bill. We spent some time today discussing some measures around getting dark money out of politics, and we hope that the Government move further on that. We look forward to the Minister introducing the Government’s response to the Rycroft review, and also to stopping mis and disinformation in our politics.

I would like to test the mood of the Committee by pushing new clause 18 to a Division. We need to see action on these issues ahead of the next general election, and it feels like this piece of legislation is the opportunity to do that. We have talked repeatedly in this Committee about trust in our electoral processes being already very fragile—too fragile. We have seen years of scandal—of varying sorts—tarnish our political structures. Confidence in our politics and democratic processes is vital, and we should be doing everything that we can to bolster that confidence, which is too low. We should not be allowing new systems to be adopted in these structures and used to undermine our politics. Existing systems can be used to show voters completely fabricated content; some recent examples of AI-generated content that is damaging in different ways have already been mentioned. Transparency is the foundation of democratic legitimacy, and new clause 18 seeks to protect that foundation.

On deepfakes, we are deeply concerned about the increase in AI-generated material that is produced to harm individuals and our broader democracy. We should be ensuring that there is transparency and accountability within political campaigning, and we need to limit the level of mis and disinformation that could be spread through AI-generated material. Requiring that political campaign material be properly labelled when it includes AI material feels like a sensible and moderate step. This is the time for us to protect our election integrity in the digital age, and I hope that the Government accept new clause 18 and take the opportunity before it is too late.

Paul Holmes (Conservative, Hamble Valley)

I hope that the hon. Member for North Herefordshire did not mind that I gave up speaking to enable her to do so, but I wanted to check whether someone would speak to those new clauses. I wanted to allow her to elaborate the argument so that I could come in with some of my thoughts at the end.

As the shadow Minister, I was intrigued, in various meetings that I have had, as we have all had, with outside organisations about the Bill, by the ideas outlined in new clauses 10 and 24. I pay tribute to the hon. Member for Milton Keynes Central for tabling them; they are substantive new clauses that I think are very well intentioned. The number of Members who have supported them on the amendment paper shows the importance of tackling some of these issues in a cross-party and urgent way.

On new clause 10, on the guidance on law relating to digital communication offences in relation to elections, the hon. Member for North Herefordshire outlined the problems that we are currently having. Digital communication offences are becoming a bigger problem, and they cause harm to people. The current duty is to demonstrate that the person has been harmed emotionally. She used the example of the deepfake that went out of my hon. Friend the Member for Mid Norfolk, showing him saying that he was leaving the Conservative party and going to Reform. Although that has not necessarily been a strange development in the last couple of months, anyone who knows my hon. Friend knows that that is incredibly unlikely. It would also cause a great deal of distress to many of us moderate Conservatives for it to ever be thought that we could go to Reform. There is serious point behind that, which is that for anyone harmed by something like that, there should be laws relating to digital communication offences.

We do not think that new clause 10 would be arduous on the Government. It asks them to publish guidance on the operation of certain offences, and it does not ask for immediate action. It allows the Minister and the Government to go away and provide guidance. The Minister has said many times today that she is considering, for example, the Rycroft review, and that she will come back with suitable guidance and proposals. The new clause is in that spirit. It would allow her to go away and look at what we need to do in this increasingly concerning area of election campaigning. The call from the hon. Member for Milton Keynes Central is eminently sensible, and so we will support new clause 10 if it is pressed to a vote because we want that guidance to be brought in.

New clause 24 proposes a repository of digital political advertising. I do not expect Committee members to remember the questioning in the oral evidence sessions—particularly my questions—but I was really quite fascinated by the proposal. Like the hon. Member for North Herefordshire and other members of the Committee, I have met some organisations that have advocated for it. I do not think that we should be fearful, as politicians and members of any political party, or of none, of standing by the things that we put out in elections. Therefore, instead of going in the bin, as some of mine do, they should be kept online to ensure transparency and accountability through a simple repository regime.

The Government have repeatedly proposed to put more burdens—more regulatory responsibilities, I should say—on the Electoral Commission. I do not think this proposal would be a particularly bad burden to place on it. There is a question about resourcing the Electoral Commission, but I know that the hon. Lady and the various organisations that are advocating for new clause 24 are pretty relaxed about who would manage holding the information and transferring it to the National Archives, so I think that is something that the Government should explore.

I was interested that the hon. Lady outlined that she is concerned about misinformation, manipulation and the exploitation of the electoral process by foreign actors. I hope that when we come to new clause 37, she will be equally concerned about the exploitation of votes using foreign languages in electoral literature. I hope she will look as favourably on that proposal as I am on this one, because I believe that is equally exploitative of various communities in the country.

We support new clause 24, which we think is radical, but sensible and transparent. If we stand by what we put out there, we should not fear the people who elect us holding us to account for what has been put out, so I think that is actually quite an exciting prospect for democracy.

That is where the consensus between me and the hon. Members for Milton Keynes Central and for North Herefordshire ends. I have a number of concerns about new clause 27, not because I am opposed to having a general conversation about the regulatory period. The hon. Member for North Herefordshire is right that parties of all colours front-load and send out a lot of stuff before the regulated period starts. The regulated period is inherently there to protect the smaller parties from the bigger parties and to give everybody a level playing field.

I know that when the regulated period starts—and we are all currently going through the start of one—every party has equal right to put out an equal amount of election literature to people in our constituencies, boroughs or counties. All parties are held to the same standard and it can be proved if there has been—I hope not—manipulation of the election expenses. The regulated period is there to protect parties.

Do not get me wrong: in my constituency five Liberal Democrat “in touch” communications go out every year. It drives me mad. I do not like it. I do not like its content, but the Liberal Democrats have every right to communicate with their residents. Putting an annual limit on the amount of literature that can be put out is anti-democratic. It is quite good to have some element of competition, where many parties can put out election communications throughout the year. I worry that having an arbitrary annual cap on the amount of literature that we can put out will harm independent candidates and local parties—they may exist: we have the Eastleigh borough independents, of whom three were successfully elected councillors. They should not be held to the same standard as national parties, which can absorb the cost. I am slightly concerned about the unintended consequences of that.

Ellie Chowns (Green, North Herefordshire)

I will pick up the hon. Member’s points in my summing up.

Paul Holmes (Conservative, Hamble Valley)

I am not being adversarial; there is an argument that although the literature that goes out via IPSA is not party political, as an elected official, IPSA is giving me the ability to send out literature that would not be included within the threshold. Other parties that oppose me at the next general election should be entitled to put out resources to match those, and I do not think that should be governed within an annual spending limit.

It worries me that if we get to a period in which we are controlling smaller, larger, regional and local political parties and holding them to the same standard in election spending as national, established parties such as those that hon. Members on the Committee represent, that would start to erode free and fair democratic access to the people who elect us and elect our colleagues in local government across the country. I am uncomfortable with that, although we could have a conversation about the lengths of regulated periods.

Lisa Smart (Liberal Democrat, Hazel Grove)

I am genuinely intrigued in several ways by the shadow Minister’s contribution. He talks about a level playing field. Most of us would always agree with a level playing field, in pretty much all circumstances. Does he think that the national spending limits for the larger political parties should be brought down significantly? He expressed real concern about smaller parties, whether localist parties or groups of independents, that do not have a national political machine with a multimillion-pound budget at a general election. If I understand correctly what the shadow Minister says, he would not see that as a level playing field. Does he agree that spending limits for local candidates should probably go up a little but spending limits for national parties should come down significantly because, after all, people put a cross in a box next to an individual’s name, not just a political party?

Paul Holmes (Conservative, Hamble Valley)

We are discussing a new clause that starts a conversation about the regulated period and would create a year’s limit on the amount of literature that can go out, outside of an election period. That seems different from what the hon. Lady is describing, which is the regulations and limits on political parties, and candidates not in a party, during an election period. Those are two very different things. I am quite happy with the fact that I have to raise the money to stand for my seat at a general election, and that national parties have to account for that.

The new clause includes provisions not just for general elections but for outside election periods. What I find concerning is that council groups—such as those of the hon. Lady’s party in Eastleigh, or my party’s in Fareham, Hampshire and all across the country—would have to be accountable for putting out communications to people who end up putting councillors in their jobs. I do not think that we should get in the habit of limiting political parties outside an election period, because I think that is an entirely different prospect, and an entirely different area from how we are governed in an election period.

I am perfectly okay to start talking about funding levels during an election period, but I do not want to do so for candidates who wish to start a campaign before the current regulatory period. As the hon. Lady will know—she is a very successful politician, both locally and nationally—we do not begin to build an election campaign just in the regulated period. Many of us started trying to get involved in politics a long time before we were elected, and I think that limit is a very dangerous thing in today’s democracy.

However, I would say to the hon. Lady that I am open to a conversation about election financing. I am looking at my Whip—my hon. Friend the Member for Ruislip, Northwood and Pinner—who is probably horrified by me saying that, but I am not against that argument or discussion. I just think that this goes a bit too far, and it does not sit well with me. After that rambling oratory, I just say to Green and Liberal Democrat Members that, if they choose to push new clauses 10 and 24 to a vote, the Opposition will support them, but we would vote against new clause 27.

The Opposition also think that the accountability in new clause 18 is very sensible. If we use AI, we should be honest about it—it is as simple as that. If any politician wants to put forward an AI-generated image, I first think there is a question about why they would want to do so anyway. We all think that our constituencies are beautiful, and we would not want to change them. We also all know that politics is acting for ugly people, so why would we want to change the way we look?

I do not understand why someone would want to use an AI-generated image, but if they do, they should actually be big enough and strong enough to own it. Therefore, it is important to have some extra regulation, particularly as some people might not be au fait with AI-generated images, as some are very believable—not the one of Donald Trump pretending to be Jesus, but the more sensible ones. People cannot necessarily pick that up, so if the hon. Member for Hazel Grove chose to push new clause 18 to a vote, the Opposition would also support it.

Samantha Dixon (Labour, Chester North and Neston)

New clause 18 seeks to require digital campaigning material, in scope of the digital imprint regime, that contains images, audio or video generated or materially altered to include a statement that such artificial intelligence has been used. The Government fully recognise the challenges posed by AI-generated content, including deepfakes, and the risks they present to democratic processes and public trust in the online information environment. We agree that helping voters understand the authenticity of digital campaigning material is an important objective.

However, AI technologies are developing at pace, and there is not yet a reliable or widely adopted technical basis for determining when content has been generated or materially altered by AI. That would make enforcement by the Electoral Commission and the police difficult in practice, and it would risk undermining campaigners’ compliance with the rules.

The new clause, as drafted, would also create uncertainty and disproportionate legal risks for campaigners. For example, it would create a new criminal offence for failing to include a statement about AI use, even where the AI involvement may be trivial, automated or outside the campaigner’s knowledge or control. Further consideration would also be needed on how liability for offences should apply to those who republish material.

There would also be a considerable chance of the new clause quickly becoming obsolete. AI is evolving rapidly, so adopting a definition of “generative artificial intelligence” in primary legislation might struggle to keep pace with technological developments and it could quickly become outdated. Although we share the intention to strengthen transparency in digital campaigning, the Government do not believe that the new clause is currently workable or proportionate. The Secretary of State for Science, Innovation and Technology recently announced that the Government will establish a taskforce to put forward proposals for Government on best practice for labelling AI-generated content, with an interim report to be published in the autumn. I urge Members to follow the progress of that taskforce.

I turn to new clause 10 and amendment 4. I thank my hon. Friend the Member for Milton Keynes Central for those and for her commitment to strengthening online protections. I know Members feel strongly about that area. I share the objective of seeing the powers of the Online Safety Act 2023 being fully and effectively utilised. With that in mind, the Government have carefully considered new clause 10, which would require the Government to publish guidance on the operation of certain offences relating to digital communications, as they relate to candidates and elected officials.

Under the Online Safety Act, in-scope service providers are already required to have effective systems and processes in place to identify and remove illegal content. That includes content that amounts to the two offences identified in new clause 10: the “false statements about candidates” offence and the offence of undue influence. Those duties apply equally to AI-generated and manipulated content where such material meets the threshold of either offence.

As the independent regulator, Ofcom issues codes of practice that provide clear guidance on what action providers should take to manage and mitigate illegal content. The codes recommend various measures across risk management, user reporting and content moderation. Ofcom has already produced guidance to assist providers in making judgments about whether certain content is illegal, and such guidance includes usage examples where possible. As the independent and expert online safety regulator, Ofcom, not the Government, is best placed to offer such guidance.

The Government have no plans to widen their role within the Online Safety Act regulatory regime by issuing guidance on matters within Ofcom’s remit. Introducing a new duty for Government to publish parallel guidance on two specific offences, and committing to regularly updating that guidance, would blur the lines between Government and the independent regulator, undermining the model for which Parliament has only recently legislated.

The Government remain firmly committed to ensuring that protections keep pace with evolving threats to democracy, and I welcome continued engagement with parliamentarians on that important issue. As Members will know, Rycroft made recommendations in his review supporting the principle of advertising libraries and suggested that the Government could use their convening power to work with social media companies to extend the practice of advert libraries to achieve consistency in how they are presented. That is not the same as setting a legal requirement for a repository of digital political advertising, as intended by new clause 10. None the less, we are carefully considering all of the recommendations in the Rycroft review and will issue a response in due course.

New clause 24 seeks to establish a repository for paid-for digital political advertising. Digital political advertising plays an important role in supporting democratic engagement. It remains one of the most accessible and cost-effective ways for political parties and campaigners to connect with the public and have their message heard. However, the Committee will be aware that the European Commission introduced similar requirements to new clause 24 in 2024, including mandatory transparency notices containing information such as spending and targeting, and the requirement for platforms to upload all political adverts to a European repository.

In response, major platforms such as Meta and Google chose to cease hosting paid political advertising entirely in the EU, citing operational complexity and uncertainty as to whether compliance by platforms and campaigners was realistically achievable. If the UK were to adopt comparable measures without fully understanding their operational impact, we could see similar unintended outcomes here.

The potential removal of political advertising from major platforms in the UK could risk reducing political pluralism online by restricting the ability of political parties, civil society organisations and candidates, many of whom rely on digital platforms to engage effectively with the public. Smaller, newer parties and independent candidates may be disproportionately impacted by such an outcome, losing an affordable channel to reach voters, while larger, well-followed parties and campaigning groups would likely be less affected. That would make campaigning more challenging for newcomers, potentially undermining the level playing field.

The Government agree that transparency in digital campaigning is important, but any reforms must be carefully balanced to protect freedom of expression and avoid placing undue burdens on campaigners and platforms. This is a complex area, and the implications need detailed consideration to avoid replicating the unintended consequences seen in other jurisdictions. In the meantime, we welcome the steps already taken by platforms such as Meta and Google, which have created publicly accessible political advert libraries. We encourage other platforms to do the same.

The measures in the Bill will extend the scope of digital imprint rules and place enforcement on a clearer and more proportionate footing, ensuring that voters can continue to make informed decisions on digital material in elections and referenda. We will continue to keep wider policy relating to electoral campaigning under review.

I turn to new clause 25. The Government absolutely recognise the importance of protecting our elections from online interference, including concerns about how algorithms, such as recommender systems, can amplify harmful or misleading content. The current legal framework to tackle online electoral mis and disinformation has the Online Safety Act 2023 as its core pillar. New clause 25 would risk creating overlap and confusion with Ofcom’s responsibilities under the Online Safety Act.

Under the Online Safety Act, in-scope services must take action in relation to any content that amounts to existing election offences during an election period. The Online Safety Act already provides Ofcom with extensive powers to gather information from services and scrutinise how algorithms operate as well as a mandate to require services to conduct illegal content risk assessments. That includes assessing the likelihood of users encountering illegal content through algorithms, how systems may exacerbate or mitigate those risks, and what safeguards are required. From 2027, categorised services will also be required to report information about their algorithms, including how they influence the display, promotion or recommendation of content. Creating overlap or confusion with Ofcom’s responsibilities under the Online Safety Act also increases the risk of regulatory uncertainty. For those reasons, we cannot accept the new clause.

That said, the Government fully recognise the importance of ensuring that the commission has the tools it needs to enforce compliance with the regulatory framework it is responsible for enforcing. That is why we commissioned the Rycroft review to consider whether political finance rules and their enforcement can be strengthened in the light of emerging risks, including covert funding and foreign interference.

As Members know, we are carefully considering relevant recommendations from the Rycroft review to ensure that political finance rules and their enforcement remain robust and fit for purpose, including recommendations relating to the Electoral Commission’s investigatory powers. We will revert with a full Government response to the review and consider whether to make further amendments to the Bill in the light of that work.

New clause 27 would require the Government to establish a review to consider the adequacy of regulated periods of elections and referendums. More specifically, it would consider whether they are of sufficient length to combat mis and disinformation, and the impact of digital campaigning outside regulated periods.

The existing length of regulated periods is designed to strike the right balance between administrative burdens and scrutiny on campaign spending. As digital campaigning is not confined to election periods, a significant part of the UK-wide digital imprint regime already applies all year round. The current legal framework to tackle electoral misinformation and disinformation online has the Online Safety Act 2023 as its core pillar, and that legislation also already operates year-round, regardless of whether we are in a regulated period.

That being said, the Government recognise that we cannot be complacent. That is why we commissioned the Rycroft review. Although we do not support the new clause, we are carefully considering relevant recommendations in the review that would reinforce measures already in the Bill to ensure that political finance rules and their enforcement remain robust and fit for purpose. Placing a requirement to conduct a review in the Bill is therefore unnecessary.

In a similar vein to new clause 18, new clause 28 would require digital campaigning material in scope of the digital imprint regime, where that material has been wholly generated by generative artificial intelligence, to include a statement to that effect, along with the name of the system used. We fully recognise the challenges posed by AI-generated content, including deepfakes, and the risks that it presents to democratic processes and public trust in the online information environment. We agree that helping voters understand the authenticity of digital campaigning material is an important objective.

However, AI technologies are advancing rapidly, and there is no reliable or industry-wide standard for identifying content that has been generated or altered by AI. Without such a standard, enforcement would be extremely challenging for the Electoral Commission and police, potentially hindering compliance with the rules. Work would be needed in relation to the creation of a new criminal offence for failing to include a statement about AI use, even where the AI involvement may be trivial, automated or outside the campaigner’s knowledge or control. Further work would also be needed to determine how liability for offences should apply to those who republish material produced by others.

Additionally, the new clause would apply only to material wholly generated by a generative AI system. In practice, we would expect most digital campaigning content to be at least partially edited, curated or adapted by campaigners, even where AI had been used at some stage. That threshold would therefore be difficult to interpret, and would create uncertainty for campaigners and enforcement authorities. There is also a significant risk that the new clause would quickly become outdated. As we have discussed, AI continues to evolve rapidly, and the definition in the new clause may struggle to keep pace with technological developments, potentially rendering the provision obsolete within a short period. For those reasons, although we share the intention to strengthen transparency around digital campaigning, the Government do not believe that the new clause is workable or proportionate.

David Simmonds (Conservative, Ruislip, Northwood and Pinner)

I have a lot of sympathy for what the Minister is saying. It seems to me that there is a risk of a “may contain nuts” kind of solution emerging: campaigners could simply put, “This may contain artificially generated imagery” on every item of digital campaigning and comply with the law, but that would not tell us whether what is being represented has been materially altered. In the light of her earlier comments about the autumn timeline, will she give the Committee a clear commitment to work not just with political parties but with industry, with a view to ensuring that we have effective copywriting and watermarking, which we know many of these organisation are already developing, so that anybody looking at political content can be confident that what they are seeing is genuinely what was said by that politician, candidate or party?

Samantha Dixon (Labour, Chester North and Neston)

The hon. Gentleman makes a really important point. As I mentioned earlier, the Secretary of State for Science, Innovation and Technology announced that the Government have established a taskforce to take forward proposals for Government on best practice for labelling AI-generated material. With the interim report due to be published in the autumn, I think it is timely that I should write to the Secretary of State for Science, Innovation and Technology to outline the concerns that have been debated in the Committee—I am looking to my officials to ensure that we pick this up—because I think it will be very informative for the taskforce’s work. If the hon. Gentleman is happy for me to do that, I will do so.

Finally, the Government recognise that there are potential issues with section 106 of the Representation of the People Act 1983, which the hon. Member for North Herefordshire mentioned. We are reviewing how that legislation should apply in a modern electoral setting and, where necessary, we will take appropriate action to clarify the scope of the section, particularly to make sure that it captures emerging technologies such as deepfakes and other AI technologies and is future-proofed.

Clause 65 - Decriminalisation of certain requirements

Desmond Swayne (Conservative, New Forest West)

With this it will be convenient to consider the following:

Schedule 10.

Clause 66 stand part.

Schedule 11.

Clauses 67 to 69 stand part.

Ellie Chowns (Green, North Herefordshire)

On a point of order, Sir Desmond. Do we need to check whether any of the amendments debated with the previous clauses need to be moved, including the ones that I tabled?

Desmond Swayne (Conservative, New Forest West)

While it was convenient to debate those new clauses with the last group, it will not be convenient to reach a decision on them until much later in our proceedings.

Samantha Dixon (Labour, Chester North and Neston)

I will speak to clauses 65 to 69 before turning to the new clauses tabled by hon. Members.

Under the current enforcement framework, most political finance offences, regardless of their severity, are treated as possible criminal offences, even when they amount to minor administrative breaches, such as the late submission of campaign expenditure reports. While criminal investigation and prosecution for such offences is rare, key stakeholders, including the Electoral Commission and the Ethics and Integrity Commission, have expressed concerns that the possibility of criminal prosecution for minor errors can deter participation in campaigning. Clause 65 and subsequent secondary legislation will address this by decriminalising administrative offences under the Political Parties, Elections and Referendums Act 2000, so that they will be punishable only through civil sanctions by the Electoral Commission rather than criminal prosecution.

We have worked closely with the Electoral Commission to determine which offences under PPERA should be decriminalised. Broadly, they relate to failures to comply with reporting requirements, such as failing to deliver a campaign expenditure return within the statutory time limit or failing to deliver a proper statement of accounts. Serious breaches, including intentional or reckless misreporting, will remain criminal offences and will continue to be investigated by the police and subject to criminal prosecution.

This will provide much-needed clarity that the Electoral Commission is responsible for enforcing such administrative breaches, allowing police resources to be directed towards tackling more serious criminal offences and clamping down on foreign money entering politics. In addition, by removing the threat of criminal prosecution for minor infractions, the clause will encourage participation by individuals and organisations that wish to campaign, while ensuring more proportionate enforcement of the rules.

Turning to clause 66, robust and proportionate enforcement of political finance law is essential for sustaining trust in our democracy. However, there is currently an enforcement gap in electoral regulation. Since 2010, to provide for more flexible and encompassing enforcement, the Electoral Commission has been able to impose civil sanctions for certain offences committed by political parties, third-party campaigners and referendum participants. In contrast, offences committed in relation to candidates and recall petition campaigners are subject only to criminal sanctions and enforcement by the police. Practically speaking, this means that breaches of the rules can be addressed only through police investigation and criminal prosecution, even where a breach is minor or unintentional. Yet criminal prosecution for minor infractions is frequently considered disproportionate to the offence and not in the public interest, which means that breaches of the rules often go unaddressed and unsanctioned.

This enforcement gap risks undermining public trust in the integrity of the electoral system by creating the perception that the rules are not being enforced and that campaigners are not complying with them. At the same time, it can create a fear of criminal prosecution for candidates, election agents and recall petition campaigners, who could face police investigation for relatively minor breaches of the law.

Clause 66 is intended to close that gap by extending the Electoral Commission’s enforcement remit, including its investigatory and civil sanctioning powers, to cover offences in relation to candidates and recall petition campaigners. Criminal prosecution will remain available for the most serious offences involving intentional or reckless breaches of the rules, but the EC will also now be able to apply its considerable knowledge and expertise to the enforcement of breaches across the political finance framework, providing for a more encompassing, proportionate and robust regime.

Clause 67 removes the statutory cap on the maximum fine that the Electoral Commission can impose for certain offences. Currently, where an offence is punishable on summary conviction by a fine, the penalty imposed by the EC may not exceed that which can be imposed by the court. The maximum fine that can be imposed by a court in such instances is unlimited in England and Wales, but £10,000 in Scotland and £5,000 in Northern Ireland.

The purpose of removing these restrictions is to ensure that the Electoral Commission’s maximum fine can be applied uniformly across all relevant offences around the UK. We will be increasing the maximum fine level in secondary legislation. This will ensure that the Electoral Commission’s new maximum fine provides a meaningful deterrent against violations of the rules across the UK, no matter where the offence is committed.

As the regulator, the Electoral Commission is invaluable in upholding trust in our democracy. That is why we are expanding the commission’s role and powers, including extending its enforcement remit and increasing its maximum fine. We intend for the Electoral Commission’s expanded role and powers to apply UK-wide at all elections, including parliamentary and local government elections.

Paul Holmes (Conservative, Hamble Valley)

I am sorry to ask this question, because it is completely and utterly about my ignorance—could the Minister believe it? Is she setting a maximum fine at secondary legislation, or is she removing the maximum fine?

Samantha Dixon (Labour, Chester North and Neston)

As I understand it, we will be setting the maximum fine in secondary legislation, but I will confirm that, because I have almost lost the thread of what I was saying.

Paul Holmes (Conservative, Hamble Valley)

I apologise to the Minister for making her lose her trail. I also am at that stage in the afternoon where things are not going in as well as they probably were this morning. I asked the question because, at the moment, the courts have an unlimited maximum fine. I just got confused about whether the Minister was setting a maximum fine through secondary legislation, which she has now clarified. As we on the Committee are discussing the changes to the Electoral Commission’s responsibilities, which the Minister has been clear about throughout the day, would she give us an indication of what that maximum fine might be? Why is she waiting until secondary legislation to set the level of that fine?

Samantha Dixon (Labour, Chester North and Neston)

It is our intention to increase the maximum fine level in secondary legislation, as I stated earlier. Its level will be debated at that time. We will debate it in secondary legislation, but it needs to remain proportionate, and we need to move towards it in a considered way and debate it then.

David Simmonds (Conservative, Ruislip, Northwood and Pinner)

I think there is a high degree of political agreement that this is the right direction of travel. Could the Minister say a little bit more about the assessment that the Department will have done about the resource implications for the Electoral Commission? We are all conscious that regulatory enforcement can come at an enormous cost to the regulator, especially where bad actors have specifically structured arrangements to evade rules and enforcement.

We have seen examples in other jurisdictions where political action committees, fake political parties and short-term political parties have been set up specifically to get around the regulations set out in light terms in the Bill. Given that that is likely to be partially funded by a costs award in the event of somebody having been found to be in breach, alongside the fine, could the Minister indicate what she thinks the cost implications are for the Electoral Commission? That is especially given that we have seen regulators in multiple jurisdictions face enormous costs for the legal process required to enforce their judgments.

Samantha Dixon (Labour, Chester North and Neston)

My officials work very closely with the Electoral Commission and would not have acted without consideration and with consultation with it. I remind the Committee that decisions about the resourcing of the Electoral Commission fall to the Speaker’s Committee on the Electoral Commission. That is the route by which it is funded. We would not want to make regulation too burdensome, but correspondingly, the Electoral Commission reports to the Speaker’s Committee regularly about its resourcing needs. Indeed, mostly recently, it returned money to the Speaker’s Committee that it did not feel it needed. To reassure Members, officials work closely with it to ensure there is sufficient resource.

Our policy ambition is for these legislative changes to be consistent across reserved and devolved elections and to be commenced in a way that provides clarity to campaigners on how the rules will be enforced across all elections. Clause 68 provides for that, as it allows the Secretary of State to make provisions that could otherwise be made by Scottish or Welsh Ministers, but only with the consent of Scottish or Welsh Ministers. In practice, subject to the agreement of the devolved Governments, that will enable us to introduce a uniform set of changes to the role and power of the Electoral Commission in relation to local government elections in Scotland and Wales.

I turn to clause 69. The Electoral Commission currently lacks an explicit statutory gateway to disclose information to other regulators and law enforcement bodies. The lack of an explicit legal basis for information sharing forces the commission to rely on incidental powers or bespoke memorandums of understanding to disclose information. Those arrangements create unnecessary complexity and delays, and make information sharing more burdensome than it ought to be. They have embedded unnecessary friction into the system, slowing co-operation between regulators on important cross-cutting regulatory issues, and frustrating the very bodies charged with upholding the integrity of our democratic processes.

To underpin our wider reforms to strengthen enforcement, the clause provides a clear legal basis for information sharing, enabling the commission to disclose information to specified regulators and enforcement bodies. It will nurture an environment of collaboration between relevant bodies on cross-cutting issues such as foreign interference, data protection and digital campaigning. To ensure that the information-sharing gateway remains effective as the regulatory landscape evolves, the list of bodies can be amended by the Secretary of State, following consultation with the Electoral Commission and subject to parliamentary approval via the affirmative procedure.

The Government note that one of the recommendations of the Rycroft report is to build on this measure and make the information-sharing gateway reciprocal, to provide clarity that the Electoral Commission can also receive information from relevant bodies. We are carefully considering all the recommendations from the Rycroft review. We will issue a full Government response in due course, and, where appropriate, we will introduce new amendments to the Bill.

With those assurances, I commend clause 69 to the Committee. I will allow other Members to speak to the new clauses and I will respond to them in due course.

Desmond Swayne (Conservative, New Forest West)

I reinforce that this is the only opportunity that the Committee will have to debate those new clauses.

Paul Holmes (Conservative, Hamble Valley)

I thank the Minister again for—I am not being facetious—her comprehensive explanation. We have been here for most of the day. These are very complicated issues, and she has been speaking an awful lot because of the importance of this legislation. I do not envy her. I will speak to new clause 41 in my name, to be voted on at another point. We welcome clause 65, but we have some questions on clause 67.

As the Minister outlined, clause 65 and schedule 10 decriminalise certain offences in PPERA. They relate to administrative requirements for political parties and others regulated by that legislation and the commission. For example, it is currently an offence for a party treasurer to fail to deliver annual accounts or reports of election expenses to the commission. The provisions will also make the necessary consequential amendments to allow the requirements to come under the commission’s civil sanctioning regime.

Clause 66 is a fairly simple clause, which extends the Electoral Commission’s remit to be the primary enforcer of all imprint rules. I would like to pick up on a theme from my hon. Friend the Member for Ruislip, Northwood and Pinner, which I also brought up earlier: the impact on the Electoral Commission’s ability to do its job properly, in relation to what it currently does compared with what the Government will ask it to do after the legislation passes.

The Minister has made it clear that officials are working with representatives of the commission. I know that she works with them as well, and they have not necessarily said that they are unhappy about receiving this new responsibility. However, my general experience from working in the public sector and serving as a local authority councillor is that, in this world of organisations that are often controlled by Treasury spending budgets, or, as the Minister outlined, the Speaker’s Committee on the Electoral Commission, no one says no to extra responsibility if they think they are going to get some more dosh—let us put it that way.

Will the commission get enough cash to be able to manage the regulatory burdens that the Government are placing on it? I am beginning to worry that with the plethora of new responsibilities, we will have to see quite a large uplift in the commission’s budgets. I have not heard convincing defences that the Electoral Commission has verbally or formally remarked to the Government that it is content to receive that much responsibility. I am sure that the Minister will come back to talk about that.

Clause 67 will increase the maximum fine that the commission could impose in a civil sanction for some summary offences. We have concerns about the size of the proposed increase in Electoral Commission civil sanction fines. The courts already have powers to levy unlimited fines. At the very least, the Macrory principles on proportionate regulatory enforcement should be embedded in law—that is what we aim to achieve in new clause 41. The Electoral Commission’s strategy and policy statement recommends the application of the Macrory principles, including

“the use of requests for improvements before resorting to fines and the need to conduct investigations in a timely manner.”

The Electoral Commission has civil sanctioning powers that apply to national referendums and elections. More serious criminal matters can be—and are—referred to the police and Crown Prosecution Service, and are then considered by a court of law. The courts already have the power to levy unlimited fines and criminal sanctions. Unlimited fines are potentially a heavy, significant punishment. That is why it would be appropriate for a judicial check and a fair hearing in a court of law. Indeed, such massive civil fines would likely be challenged via lawyers in the courts anyway, as we have seen with the Information Commissioner and general data protection regulation fines.

In relation to the Minister’s opening remarks about setting the level of the Electoral Commission fine at secondary legislation, I am concerned that that is because of, quite frankly, the unpreparedness of the Government. They have put a lot of legislation forward without properly consulting the Electoral Commission and are rushing, as we have said all along in this legislation, to try and legislate without necessarily thinking things through.

Samantha Dixon (Labour, Chester North and Neston)

Opposition Members did ask about the level at which we would set the fine. I have now consulted my notes; we intend, through secondary legislation, to increase the limit to £500,000 per offence. That will be done through secondary legislation.

Paul Holmes (Conservative, Hamble Valley)

I thank the Minister for that; that clarity is welcome. I still question why that needs to be done at secondary legislation. If the Minister knows the maximum fine limit for the Electoral Commission today, she could have put that in the legislation or brought forward an amendment to be discussed in Committee. She has chosen not to do that; I am interested to know why she has chosen not to do that and is waiting for secondary legislation to do so. Perhaps she will come back and tell the Committee why that is the case.

My point still stands. The fact that she is looking to set the fine at the secondary legislation stage outlines that, once again, the Government are asking the Electoral Commission to do a great number of things that it currently does not do. I am not convinced, unless the Minister can reassure me in writing or come back after this Committee, that the Electoral Commission has been properly consulted. Let us not forget that it was the Electoral Commission that criticised the Government for not consulting it on trying to postpone the elections. That was a process where the Government were found to be unlawful—by the Secretary of State on the Floor of the House.

I am concerned that, as we have gone through this legislation, a huge amount has been asked of the Electoral Commission in terms of its responsibility and purview, and the Minister has not reassured me that it is happy with that. I am not convinced that the resource that it currently has would allow it to conduct its operations or, if necessary, investigations on its current physical envelope.

Samantha Dixon (Labour, Chester North and Neston)

The reality is that the Electoral Commission already imposes fines; it is just that they are not big enough. I argue that, by not setting the level in primary legislation but doing it in secondary legislation, it can be responsive should it need to be changed in the future, which it may need to be. We have talked about the revolving nature of foreign interference; in similar ways, the offences and their gravity may change over time. To be able to respond to that through secondary legislation is important, and we should not be hidebound by requiring primary legislation.

The Electoral Commission is accountable to Parliament, not to Government. It is a very important point to make that the consideration of its comfortableness, abilities or capacity is a discussion for Parliament. My officials work with it collaboratively, and I meet with it regularly. It is comfortable, but we must always remember that it is accountable to Parliament, not to Government.

Paul Holmes (Conservative, Hamble Valley)

I absolutely accept the Minister’s point that it is accountable to Parliament, but her party and her Government have a majority in this Parliament, and her Government are asking the Electoral Commission to do a huge amount more. She says that it has been consulted, but all I would say is that, in other areas, it was not consulted when the Government have arbitrarily gone ahead and decided to do what they want to do.

The Minister is also correct, and I thank her for her correction, that the Electoral Commission already issues fines. I do not dispute that, but this Government, through schedule 10 and clause 65, are trying to remove some of the fine elements from the judicial system and place more responsibility on the Electoral Commission. That is my concern about the extra responsibility it would have, which has been taken away from the judicial system, as well as some of the other responsibilities that it is being asked to take on, as we have discussed in relation to previous clauses.

David Simmonds (Conservative, Ruislip, Northwood and Pinner)

Does my hon. Friend agree that, when we look across the system, we see other regulators—Ofcom probably comes to mind—where fines have been issued through a civil process like the one this legislation envisages. We know that Ofcom is currently engaged in a battle with 4chan, which it has fined a very significant sum for failing to meet legal requirements in the United Kingdom for age verification checks for online pornography. 4chan’s response has been to refuse to pay the fine and to counter-sue in the courts of the United States, arguing that, because it has a headquarters in the US, it is effectively a restraint on trade by the British Government and a breach of its rights under US legislation.

Clearly, there is a significant possibility, given that civil courts have a different burden of proof than criminal courts, that this could end up entangling the Electoral Commission in all sorts of long-running and extremely expensive disputes in a way that is not currently envisaged. We need to foresee that risk and plan for it appropriately.

Paul Holmes (Conservative, Hamble Valley)

I agree. I am all in favour of streamlining and making things more efficient, but I am worried that the unintended consequence of essentially removing the judicial oversight element is that the Electoral Commission cannot actually enforce—or, if it does try to enforce, adherence can simply be refused. The Government have done this in another organisation, Natural England, through measures in the Planning and Infrastructure Act 2025. They gave Natural England—an organisation that has limited finances—an enforcement role in legislation, but with no teeth. Therefore, I share my hon. Friend’s concern that this simply will not work.

I have said what I have to say on those clauses, and I would like to press new clause 41 to a vote. We will not oppose any of those clauses, but I warn again that we are concerned about the Electoral Commission’s ability to undertake its responsibilities, and I know that the Minister has responded to that.

Lisa Smart (Liberal Democrat, Hazel Grove)

I should start by reminding the Committee that I am a member of the Speaker’s Committee on the Electoral Commission, so I have been a part of some of the discussions the Minister mentioned. I also met the chief exec of the Electoral Commission to talk about what is in the Bill, what the Electoral Commission welcomed and worked with officials on, and what it would have liked to have seen more on. That was a useful and productive meeting. The commission made some public comments, and I cannot remember the exact wording used, but it was underwhelmed at some elements, I think.

I am particularly keen to speak to new clause 46 and new clause 53, which is in the name of my hon. Friend the Member for Guildford. New clause 46, in the name of the hon. Member for Warwick and Leamington (Matt Western), has drawn attention to Electoral Commission comments about a Catch-22 in its powers to investigate suspicious transactions:

“Despite our statutory duty to monitor and take all reasonable steps to ensure compliance…we currently have no ability to obtain any information from financial institutions that we can use to monitor and independently verify provenance or the permissibility of funds, unless we open a full investigation. This is a weakness: to open such an investigation needs clear evidence—but we can’t always obtain that in the first place.”

The Government said that they would keep the Electoral Commission’s powers under review, and noted that they were increasing planning powers per offence to provide a greater deterrent. However, the report emphasised that the Electoral Commission can impose fines only if it can prove an offence has occurred in the first place. The fact that it often cannot do so is precisely the problem and underpins the need for stronger information-gathering powers. New clause 46 would increase the commission’s powers to require financial institutions to provide it with information in relation to the permissibility of donations.

New clause 53 is complementary to new clause 46. It would enable the Electoral Commission to require information before launching a formal investigation. When I met the commission’s chief executive with my hon. Friend the Member for Guildford, who tabled the new clause, we talked about exactly that issue. The Rycroft review, which has been mentioned many times today, states that the Electoral Commission, unlike the other regulators, cannot demand information outside a formal investigation, meaning that it cannot work in real time to head off offences. The review recommends extending powers so that the commission can require information from relevant bodies and persons.

By comparison, the Charity Commission has the option of a regulatory inquiry, which gives information-obtaining powers without the necessity of enacting a lengthy statutory inquiry. The Joint Committee on the National Security Strategy report, describing the Catch-22, recommends powers for the Electoral Commission to compel information, deployable in appropriate cases outside formal investigations. The Committee on Standards in Public Life’s 2021 review recommended extending the commission’s powers to compel document information and explanation outside an investigation.

Election-related harms are increasingly amplified online. The Electoral Commission evidence to the Speaker’s Conference explicitly links disinformation and platform algorithms to harassment and intimidation, and it describes concrete candidate harms, including deterrence and avoidance. The Speaker’s Commission earlier called for electoral law review, including addressing the disinformation that can fuel abuse and intimidation, and a number of people involved in the democracy sector and the implementation of the enforcement of electoral law would welcome looking at a review of all the many Representation of the People Acts that have taken place over time, so that we can look at where they complement one another and where, on occasion, they do less than that.

The last point to make is that if platforms can micro-target voters in real time, surely the regulator must be able to obtain basic information in real time. On that note, I commend new clauses 46 and 53 to the Committee.

Lloyd Hatton (Labour, South Dorset)

I will keep my remarks brief in the interests of avoiding repetition. It is important to put on the record the changes in the Bill, which are hugely welcome. One of those is massively improving the information sharing and investigatory powers of the Electoral Commission to ensure closer working with regulators and law enforcement.

It should go without saying that the commission is the key watchdog in our democratic process and that it ensures that our elections and our political parties operate with integrity day to day. That is why it is particularly important that we look at some of the points being made as part of new clause 46. As has been said often today, that is touched on in some detail as part of Philip Rycroft’s review; the need to ensure that the information-sharing and investigatory powers of the Electoral Commission are as effective as they need to be, and that they work in a two-way direction to ensure that that work is undertaken.

I note that the Minister already touched on this at the start of this grouping, and that her and her officials will be wanting to look at it in more detail. I look forward to that, because it is important that we get this right as we make these positive steps forward in this part of the Bill. We must ensure that the Electoral Commission, as our key national watchdog for elections and the democratic process, has the powers and information at its fingertips to operate as effectively as possible.

Ellie Chowns (Green, North Herefordshire)

I strongly support measures to strengthen the capacities and powers of the Electoral Commission, which plays a crucial role in regulating our politics. I will speak briefly to new clauses 46 and 53. As has already been highlighted, they are basically fully in line with Philip Rycroft’s recommendations 9 and 10, so I hope that Government amendments will be tabled in due course to address those recommendations, the justification for which has been clearly outlined.

My new clause 57 concerns the Electoral Commission’s fining power. I very much welcome the Government’s announcement that they will bring forward secondary legislation to increase the commission’s maximum fine to £500,000 from £20,000, which is clearly peanuts and no disincentive at all. That will be a significant improvement, and of course will bring the measure in line with the penalty that can be imposed for breaches of electoral finance rules in relation to referendums in Scotland.

Lloyd Hatton (Labour, South Dorset)

Does the hon. Member share my view that the old system that we inherited meant that foul play by a political party was essentially priced into the system, because the fine was so small? What the Government are doing, by increasing the fine to £500,000 for a single offence via secondary legislation, means that that type of culture, in any political party, will come to an end—no party can simply say that these fines are the cost of doing business.

Ellie Chowns (Green, North Herefordshire)

Absolutely. It is clear that the previous level, £20,000, was utterly inadequate, so I welcome the Government’s commitment to strengthen that. The purpose of my new clause 57 is to suggest ways in which it could be strengthened further, namely by putting the maximum fine into primary legislation, and by providing that the maximum fine would be £500,000 or 4% of campaign spending, whichever was the higher. I will explain why.

Most other regulators in the UK can impose unlimited fines, a high multimillion-pound fine or a fine as a percentage—for Ofcom, for example, 10%—of annual turnover. In its 2021 review of electoral finance, the Committee on Standards in Public Life recommended that the fine should be 4% of the value of campaign spending or £500,000, whichever was the higher. My new clause simply calls for what the Committee on Standards in Public Life argued for.

Analysis from Spotlight on Corruption has shown that the currently proposed increase to a £500,000 maximum fine would amount to a mere 1.5% and 2.1% of the campaign spending of the Labour and Conservative parties respectively, as the two largest-spending parties. If those parties had committed an egregious offence during the 2024 general election and the 4% measure had been in place, the maximum fines would have been £1.2 million or £955,000 respectively—double the current maximum. Arguably, it should be even higher—Ofcom can fine 10%—but my new clause simply puts forward the recommendation of the Committee on Standards in Public Life.

The Minister touched on the question of whether to have the limit in primary or secondary legislation. She argued—I think I am paraphrasing accurately—that one of the advantages of having it in secondary legislation is that it can be easily updated. However, the previous level of the fine, which was £20,000, was set out in secondary legislation—it was in the Political Parties, Elections and Referendums (Civil Sanctions) Order 2010—and it was never updated. The Minister said that the level of the fine might need to be set out in secondary legislation so that it could be more easily updated to make it higher, but the historical record shows us that we have had fines that are far too low and that they are not adapted.

If the fine is to be set out in secondary legislation, in future years a future Government might be tempted to amend the fine, which they could do more easily than if it was in primary legislation, in order to reduce it back down to the previous and clearly totally inadequate level. I would argue that it is useful and important to have the level of the fine in primary legislation, precisely to set that benchmark. Perhaps in future we might want to make the fine higher, but at least for the moment let us make sure that the level of the fine is not capable of being easily reversed by a future Government.

I very much hope that the Minister will respond warmly to the recommendation, which, as I pointed out, was made by the Committee on Standards in Public Life—this is not a Green party proposal, although it is one that I strongly propose; it comes from a completely different body. It would ensure that the fining powers of the Electoral Commission are broadly brought into line with the fining powers of other bodies that have a numerical number or a percentage—whichever is larger—as their maximum fine.

Samantha Dixon (Labour, Chester North and Neston)

I will speak to each of the new clauses, beginning with new clause 41, which seeks to place the Macrory principles on a statutory footing in relation to the Electoral Commission’s use of civil sanctioning powers.

We fully recognise the importance of the Macrory principles and agree that regulatory enforcement should always be flexible, transparent and proportionate. These principles were designed to guide the construction of regulatory systems and sanction regimes. As such, the Macrory principles directed the development of the Electoral Commission’s regime of civil sanctions, which was introduced by the Political Parties and Elections Act 2009 and therefore is already embedded in the commission’s regulatory practices. That includes the ability to issue fines for a wide range of offences, the use of stop notices and enforcement undertakings, and provision for representations and appeals.

The Electoral Commission is also required to publish guidance on its use of such powers, which it must have regard to when exercising its functions. It does this through its enforcement policy. Therefore, fairness and proportionality are already central to how the Electoral Commission operates. Indeed, the commission’s enforcement policy explicitly states that it will impose sanctions where appropriate, proportionate and in the public interest. For that reason, we do not consider it necessary or appropriate to apply the Macrory principles as the new clause proposes. The Electoral Commission is, and must remain, an independent regulator. It is vital that it retains the flexibility it needs to decide how best to use its enforcement powers, rather than being tied to a rigid statutory checklist for individual enforcement decisions.

The Government have been clear in our commitment to strengthening the Electoral Commission’s independence, including through the repeal of the strategy and policy statement, which the commission was previously required to consider in the exercise of its functions. Introducing further statutory requirements of this kind risks cutting across that principle and altering the balance of the commission’s operational autonomy. There is a very real risk that amending PPERA to codify these principles in this way is unnecessarily duplicative and could lead to legal uncertainty. Enforcement decisions could become a quagmire of legal challenge, which would delay action and weaken the commission’s overall effectiveness as a regulator. Having given these assurances, I hope that the hon. Member for Hamble Valley will not press new clause 41.

I turn now to new clause 53, which seeks to provide the Electoral Commission with powers to request information from any person where such information is relevant to determining whether to open an investigation. The Government recognise the importance of ensuring that the commission has the right tools it needs to make informed decisions about potential breaches of political finance rules. The commission already has substantial information-gathering powers to support its regulatory functions, including the enforcement of political finance and imprint rules. That said, the Government recognise that we cannot be complacent, which is why we commissioned the Rycroft review to consider whether political finance rules and their enforcement can be strengthened in the light of emerging risks, including covert funding and foreign interference.

Although we do not support the amendment, we are carefully considering relevant recommendations from the Rycroft review that reinforce measures already included in the Bill to ensure political finance rules and their enforcement remain robust and fit for purpose. There will be a full Government response to the review, and we will consider whether further amendments to the Bill are appropriate in the light of that work. With those reassurances, I hope the hon. Member will withdraw her amendment.

New clause 57 seeks to increase the Electoral Commission’s maximum fine from £20,000 per offence to a new maximum of £500,000 or 4% of campaign expenditure, whichever is greater. It also requires that any order seeking to amend the suggested percentage can be made only if recommended by the Electoral Commission following consultation with the Ethics and Integrity Commission. The Government fully recognise the importance of ensuring that the commission has robust enforcement powers. A strong and proportionate civil sanctions regime is essential for securing compliance with the rules and upholding trust in our democracy.

The current maximum fine of £20,000 does not provide a meaningful deterrent against rule breaking. The Electoral Commission has argued for a long time that it risks becoming a mere cost of doing business for the largest political parties and campaigners. The Government agree that increasing the maximum fine is essential, so that sanctions reflect the scale of modern political campaigning and ensure that all campaigners, no matter how large, face significant repercussions when the rules are broken. That is why we intend, through secondary legislation, to increase the commission’s maximum fine significantly to up to £500,000 per offence.

The reason why the change will be made through secondary legislation is that Parliament has already provided the Secretary of State with the power to make supplementary orders in relation to the Electoral Commission’s civil sanction regime. Any such order is subject to parliamentary approval under the affirmative procedure. It was through the exercise of that power, and through that process, that the existing maximum fine was established in the Political Parties, Elections and Referendums (Civil Sanctions) Order 2010, which is referenced in the new clause. It is therefore appropriate to follow the same process for making changes to the commission’s regime of civil sanctions where it is already provided for in legislation.

In terms of adding statutory requirements that must be met before the Secretary of State can make a supplementary order, the Government have seen no evidence that such conditions are necessary. We have worked closely with the Electoral Commission through the development of the measures in the Bill, and we will continue to work collaboratively as we develop the detail of proposals for increasing the maximum fine that it can impose. Those details will be set out in secondary legislation in due course, and at that time Parliament will rightly have the opportunity to scrutinise and debate the Government’s approach and consider whether to approve the legislation. For those reasons, and with those reassurances in place, I hope the hon. Member will withdraw her amendment.

Ellie Chowns (Green, North Herefordshire)

The Minister will forgive me, but I did not hear her respond to the reference in my new clause to the 4% of campaign spending. Did I briefly drop off? Will she consider that when introducing secondary legislation?

Samantha Dixon (Labour, Chester North and Neston)

We have considered it, and we have decided to opt for a fine of £500,000. However, when we introduce the secondary legislation, the debate may flesh out that argument, and the figure may change, should secondary legislation and the debate lead to that conclusion. However, at this stage, we will not accept the amendment.

New clause 46 seeks to give the Electoral Commission powers to compel financial institutions to disclose information related to income and expenditure of regulated entities, such as political parties and candidates, where it is reasonably required by the commission to carry out its functions. The Government fully recognise the importance of ensuring that the commission has the tools it needs to enforce compliance with political finance rules. The commission already has substantial information gathering powers to support its regulatory functions, including the enforcement of political finance and imprint rules.

That said, the Government recognise that we cannot be complacent, which is why we commissioned the Rycroft review to consider whether political finance rules and their enforcement can be strengthened in the light of emerging risks, including covert funding and foreign interference. As Members know, we are considering the relevant recommendations of the review that could reinforce measures already in the Bill to ensure that political finance rules and their enforcement remains robust and fit for purpose. I note that new clause 46 draws on a recommendation from the Joint Committee on the National Security Strategy and covers very similar ground to one of Mr Rycroft’s recommendations. We will revert with a full Government response to the review and consider whether to make further amendments to the Bill in the light of that work.

Written evidence reported to the House