Conduct of Mr George Osborne
Introduction
1. The Parliamentary Commissioner for Standards has submitted a memorandum to us on his investigation of a complaint against Mr George Osborne, the Member for Tatton, by Mr Kevan Jones, the Member for North Durham and Mr John Mann, the Member for Bassetlaw. The complaint alleges that Mr Osborne had failed to register certain donations in the Register of Members' Interests.
2. A copy of the memorandum is appended to this Report. In accordance with our usual practice, we have shown a copy to Mr Osborne.
3. The essence of the complaint is that Mr Osborne failed to include in his personal entry in the Register details of donations made to the Conservative Party and used by the Party to support the cost of running his office as Shadow Chancellor of the Exchequer. Each of these donations had been reported to the Electoral Commission as donations to the Conservative Party in accordance with the requirements of the Political Parties, Elections and Referendums Act 2000.
4. In the course of the Commissioner's inquiry, it became clear that a similar policy of not including in their Register entries details of financial support received from Conservative Central Office was followed by most members of the Shadow Cabinet. A decision on this complaint therefore has ramifications well beyond Mr Osborne's own Register entry. In essence, those concerned believed that financial support from the central party organisation for their work as Shadow Ministers fell outside the scope of the House's registration requirements, and those of Category 4(b) in particular.[1]
In what circumstances should financial support from the central party organisations to Members in their capacity as Shadow Ministers be registrable?
5. Mr Osborne's central proposition is that donations made through Conservative Central Office in support of a Shadow Ministerial office are not generally registrable in the Register of Members' Interests.[2] In other words, he asserts that financial support received through the party to support a Members' work as a Shadow Minister does not constitute 'financial or material support as a Member of Parliament'.
6. In this context, it is important to bear in mind the overall purpose of the House's Register of Members' Interests, which is:
"To provide information of any pecuniary interest or other material benefit which a Member receives which might reasonably be thought by others to influence his or her actions, speeches or votes in Parliament, or actions taken in his or her capacity as a Member of Parliament."
7. The key question is in what circumstances financial support received in support of Shadow Ministerial functions falls into this category. It clearly does if it is received by the Member for that purpose direct from a donor. But what if the donation is received indirectly through the Member's political party? As a matter of law, any such donation will be treated by the Electoral Commission as a donation to the party: the underlying question is whether this is decisive when deciding whether such indirect financial support should be included in the Register of Members' Interests.
8. In considering Mr Osborne's proposition as set out above, the Commissioner has addressed three key questions:
Does the obligation to register donations received as a Member of Parliament extend to donations received to support a Member in a Shadow Ministerial office;
Does the obligation to register donations apply only if the donation is for the individual by name, and not by virtue of the political office he or she currently holds; and
Does the obligation to register apply only where the donor identifies specifically the intended recipient of the donation and not where they are content for it to be used for any purpose in support of a political party.
9. On the first question, the Commissioner concludes[3] that there is no logical reason to distinguish between the different capacities in which Members of Parliament receive financial support in reaching a decision on whether this is registrable. While this is not the interpretation that has generally been followed hitherto, at least by the Opposition Front Bench, we accept the logic of the Commissioner's argument. It therefore follows that financial support received by Members to support Front-Bench duties is, in principle registrable if it comes from an identifiable donor.
10. On the second question, the Commissioner concludes that it is immaterial for the purpose of registration whether the donation is for the use of an individual Member by name, or is used by him or her by virtue of a Shadow office they are holding.[4] We accept the logic of this argument too, and agree that as long as the Member holds the office, they should register the donation.
11. On the third question, the Commissioner concludes that donations from known sources used to support Shadow Ministers should be registrable by the Shadow Minister irrespective of whether the donor has expressed a wish that the donation be used for that specific purpose.[5] We accept that there is scope for a perception of influence in these circumstances, and we understand that, in good faith, some Members have come to a different conclusion, but we agree with the Commissioner that registration is appropriate. It will in this context be important for parties to inform their Front-Benchers if donations from a particular donor are supporting them.
12. We agree that, taken together, the approach put forward by the Commissioner will lead to greater transparency in this important area. We consider further below how it might work in practice.
Conclusions
The complaint against Mr Osborne
13. The Commissioner concludes that the complaint against Mr Osborne should be upheld but that, in all the circumstances, it would not be fair or reasonable to criticise him. We agree with this conclusion for all the reasons set out by the Commissioner.[6]
14. The Commissioner has made five specific recommendations arising from this case:[7]
the Registrar of Members' Interests and the Commissioner should always be consulted about points of difficulty and uncertainty in the interpretation of the rules (as the Registrar was in this case);
those seeking guidance should be as clear and as focused as possible about the question they are asking and the reasons for so asking. Hypothetical questions can easily create confusion;
Members are often well advised to approach the Registrar direct to confirm their understanding of guidance which they might have received from other sources to ensure that it applies to their particular circumstances;
in the case of identifiable donations received through a party's central office, it would aid clarification if the fact that the donation was received through that office were recorded in the Register entry;
in view of the uncertainties which this case has revealed, the Commissioner's office should consider with the Registrar issuing some further advice about the use of Category 4(b) for donations to Shadow party offices.
15. We welcome these recommendations, and commend them to the parties concerned.
16. It follows from our conclusions that there will be a need for a number of Members in Shadow Cabinets, and perhaps in more junior shadow posts, to amend their Register entries. We agree with the Commissioner that, provided they do so within four weeks of the date of publication of this report, he should not entertain any complaints about previous non-registration, in those cases where the donor has expressed a wish as to how that money is to be spent. Members should continue to register donations in these circumstances.
17. However, the Commissioner's recommendation,[8] which we accept, goes further. All donations which go to the support of a Member in the course of their Parliamentary duties, including their donations as a holder of a Shadow office, should be recorded in the Register of Members' Interests where they are:
given direct to that Member; or
given to a third party, in particular a party central office, and the donation or parts of it are assigned to that Member in circumstances where the name of the donor is linked to the donation and the Member knows, or reasonably could be expected to know, the identity of the donor.
This requires registration where the name of the donor is linked to the donation to the Member, not by the donor but by the Party. We accept, like the Commissioner, that this change of approach may reveal a range of operational practicalities that need to be resolved, a process that is likely to involve not only Members and their political parties, but also the Electoral Commission and others. We look to the Commissioner to initiate the necessary consultations with all the parties concerned. We also welcome his recognition that the process needs to be consistent with the wider context of the 'one stop shop' as a whole for the reporting by Members of permissible donations, to be achieved by the commencement of section 59 of the Electoral Administration Act 2006[9]. The creation of this 'one stop shop' is something to which we attach high priority.
18. We invite the Commissioner to report back when these consultations are completed.
1 Category 4: Sponsorships
(a) Any donation received by a Member's constituency association which is linked either to candidacy at an election or to membership of the House; and
(b) any other form of financial or material support as a Member of Parliament,
amounting to more than £1,000 from a single source, whether as a single donation or as multiple donations of more than £200 during the course of a calendar year. Back
2 Appendix, para. 69. Back
3 Appendix, para. 69. Back
4 Appendix, paras. 70-71. Back
5 Appendix, paras. 72-74. Back
6 Appendix, paras. 78-81. Back
7 Appendix, paras. 82-3. Back
8 Appendix, para. 88. Back
9 Appendix, para. 87. Back
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