Source: http://www.sandy-a.co.uk/vslh/46politics.htm
Timestamp: 2018-12-16 21:41:00
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Sandy Adirondack: Voluntary Sector Legal Handbook update chapter 46
UPDATED INFORMATION FOR CHAPTER 46:
CAMPAIGNING AND POLITICAL ACTIVITIES
This page contains only archived items, which may not be up to date. For current updates to the chapter, see the legal update website for voluntary organisations at www.sandy-a.co.uk/activities.htm.
A number of court rulings, in particular Bowman v Secular Society Limited in 1917 and National Anti-Vivisection Society v Inland Revenue Commissioners in 1947, have made it clear that seeking to achieve a political purpose cannot in itself be charitable. This is because charities must exist for the public benefit, and the courts will not decide whether a particular political purpose is or is not for the public benefit. The courts have also ruled that to be charitable, an organisation's objects must be wholly and exclusively charitable  so if the objects include seeking to achieve a political purpose, the organisation cannot be a charity even if all the other objects are charitable.
Updated 6/11/13. This information updates s.46.1.2 in The Russell-Cooke Voluntary Sector Legal Handbook (VSLH3).
The introduction of a statutory register of lobbyists, a manifesto commitment of the Coalition government, is now included in part 1 the Transparency of Lobbying, Non-Party Campaigning and Trades Union Administration Bill. This was published on 17 July 2013 and is currently going through Parliament, with committee stage in the House of Lords on 5 and 11 November 2013.
The government's intention is for the bill "to bring greater transparency to politics, fairness to political campaigning, and accuracy to trade union membership records". It includes the introduction of a statutory register of consultant lobbyists, and tighter regulation of the amount organisations can spend on political campaigning during election periods [see Threats to voluntary sector campaigning, below].
Consultant lobbyists are defined as those who are paid to "make communications" on behalf of a third party  with communications limited to direct personal communications with a government minister or permanent secretary of the civil service.
Consultant lobbyists who meet this narrow definition will be required to disclose details of their clients on a publicly available register. It will be an offence to carry on the business of consultant lobbying while unregistered. The government says the intention is not to prevent or deter lobbying, but to bring transparency about who is lobbying for whom.
However, the bill does not cover lobbying by in-house lobbyists, or lobbying by people working for organisations or businesses whose main business is not lobbying. The voluntary sector has generally welcomed the fact that its own lobbyists will not be required to register, although registration will be required for third parties paid by charities and other voluntary organisations to lobby on their behalf. Such consultant lobbyists will have to be registered and will have to disclose that they represent the organisation.
Less welcome is that major corporations will be able to avoid registering  and thus avoid transparency  by using consultant lobbyists only for communications with officials below ministerial or senior civil service level, and using their own in-house lobbyists for communications with ministers and senior civil servants. There is also disappointment within the voluntary sector that there is no code of conduct on lobbying, and no independent regulator.
A critic of the bill, Labour MP and shadow Cabinet Office minister Jon Trickett, said the proposed register would exclude 99% of meetings between lobbyists and ministers, 80% of lobbyists and 95% of lobbying activity. Labour amendments to extend the register to include a wider range of lobbyists, including those working in charities, were defeated at an early stage as the bill went through the House of Commons.
The bill has now been through the Commons. In the House of Lords it has had its first reading (a formality) on 9 October 2013 and its second reading debate on 22 October, and is having its committee stage debate on 5 and 11 November. This will be followed by
The bill can be accessed and tracked on the Parliament website via tinyurl.com/mv3xq3r, with up to date information at tinyurl.com/lr7g96e. The government's intention is to have royal assent for the bill by mid-January.
Background to the register of lobbyists
The government's starting point for developing a statutory register of lobbyists was a Cabinet Office consultation from 20 January to 13 April 2012 on how such a register should work.
Lobbying was described as seeking to influence the UK government or UK parliament on public policy, government decisions or legislation. Lobbyists were defined as those who undertake, or whose employees undertake, lobbying activities on behalf of a third party client. There was no intention to include individuals or organisations who undertake lobbying activities on their own behalf. It would therefore not cover interaction between constituents and their MPs, or the normal interaction between businesses, charities or other voluntary organisations and the government.
It was proposed that the register would include the names of lobbying firms, individual lobbyists and their clients, and whether a lobbyist was previously a government minister or senior civil servant.
Following the consultation, the House of Commons political and constitutional reform committee published its report on 13 July 2012, and a summary of responses to the consultation was published on 16 July 2012. The committee criticised the proposed statutory register of lobbyists, saying it would cover only lobbyists acting on behalf of third party clients, and not in-house lobbyists within organisations and businesses. The committee recommended that the register be replaced with a system of "medium regulation" under which all those who lobby professionally, in a paid role, would have to declare the issues they are lobbying on. Unlike the initial proposals, this could catch employees of charities, trade unions, thinktanks and other organisations or businesses, if the employees' work was primarily lobbying.
The report also recommended other ways to improve transparency, such as publishing information about ministerial meetings within a month of their happening; improving the level of detail in meeting disclosures; standardising the format of meeting data; and publishing the company or charity number of the organisation doing the lobbying.
The consultation documents and report can be accessed via tinyurl.com/oodalp3 and tinyurl.com/7htygy5.
A Commercial Lobbyists (Registration and Code of Conduct) Bill, introduced by Labour MP Thomas Docherty, had its first reading on 25 June 2012 but was withdrawn after a second reading debate on 1 February 2013, when Cabinet minister Chloe Smith said the government would be putting forward new proposals. Docherty's bill called for a statutory register covering all in-house as well as third party lobbyists, backed up by a code of conduct for lobbyists.
With the Transparency of Lobbying etc Bill the government has reverted to its original proposal, for a statutory register covering only consultant lobbyists  those who are paid to "make communications" on behalf of a third party.
THREATS TO VOLUNTARY SECTOR CAMPAIGNING IN THE RUN-UP TO ELECTIONS
Updated 12/1/14. This information updates s.46.1.2 & 46.5 in The Russell-Cooke Voluntary Sector Legal Handbook (VSLH3).
Despite very significant amendments announced by the government on 9 January 2014, there are still deep concerns about part 2 (ss.26-35) of the Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Bill and the impact it will have on campaigning by charities and other organisations during the period before general elections.
The House of Lords report stage on the bill starts on 13 January 2014 with its vote on amendments on 15 January 2014. Organisations which remain concerned are asked to sign the Commission on Civil Society and Democratic Engagement's petition now at civilsocietycommission.info/petition, asking the Lords to back the amendments tabled by Lord Harries, chair of the commission. The same petition is on the 38 Degrees website at tinyurl.com/pqhkefv.
Lord Harries' amendments would change the definition of controlled expenditure so it only covers campaign activity related to legislation before Parliament in the regulated period during the run-up to a general election, rather than any political issue; does not include communications with "committed supporters", defined as anyone who has made a donation or sent a communication to the organisation in the previous year; and does not include the cost of staff involved in campaign activity. Another amendment would define expenditure in a specific constituency or constituencies only as expenditure on election material addressed or delivered to individuals or households in the constituency, and unsolicited telephone calls made to such individuals or households.
The Directory of Social Change is asking charities to continue pressing the Lords to exempt charities from the bill, and has a letter at www.dsc.org.uk that can be adapted. An amendment exempting charities was withdrawn during the Lords debate in December. Exempting charities would clearly be advantageous to charities, but non-charitable voluntary organisations would still be caught. As a former coordinator of the non-charitable Campaign Against Arms Trade my view is, not surprisingly, that the lobbying bill should not be allowed to deter campaigning by either charitable or non-charitable voluntary organisations.
The report stage on 13-15 January will be followed by the third reading and vote on the bill in the House of Lords, then the amended bill goes back to the Commons, then it "ping pongs" between the Commons and Lords until there is agreement. It then receives royal assent and becomes law, although it will not necessarily come into effect immediately.
Below are details of the the government's amendments, how to keep up to date, the bill in the House of Commons, the bill in the House of Lords, the Commission on Civil Society and Democratic Engagement, and implications of the bill.
The government's amendments
Amendments proposed by the government on 9 January 2014 include the following.
The government is proposing that for the 2015 general election only, the regulated period before a general election will be 7.5 months rather than 12 months. For the 2015 election, it will start on 19 September 2014, the day after the Scottish referendum. This will allow more time for the Electoral Commission to produce guidance before the regulated period begins.
The lobbying bill as originally proposed would have reduced controlled expenditure thresholds for registration with the Electoral Commission from £10,000 to £5,000 in England, and from £5,000 to £2,000 in Scotland, Wales and Northern Ireland. The government's new amendment will actually double the current threshold, from the current £10,000 to £20,000 in England, and from £5,000 to £10,000 in Scotland, Wales and Northern Ireland. Most organisations which carry out small scale campaigning will thus not have to register with the Electoral Commission, with all of the accounting and reporting requirements that this involves. They will, however, need to monitor expenditure to ensure it does not go over the threshold.
The lobbying bill would have decreased a registered organisation's controlled expenditure spending limit from £793,500 to £319,800 in England, from £108,000 to £35,400 in Scotland, from £60,000 to £24,000 in Wales, and from £27,000 to £10,800 to in Northern Ireland. The UK-wide limit would thus be reduced from £988,500 to £390,000.
The government's amendment will keep the new England limit at £319,800. but the other new limits by £20,000. Their limits will be reduced from the current £108,000 to £55,400 in Scotland, from £60,000 to £44,000 in Wales, and from £27,000 to £30,800 to in Northern Ireland. The UK-wide limit will thus be reduced from £988,500 to £450,000.
The lobbying bill would have required any organisation that takes part in a campaign with other organisations to account for the full amount spent by the joint campaign, rather than only its own portion. The government's amendment will require only the lead organisation to register coalition campaigns, rather than every organisation involved.
Government amendments will exclude Welsh translation costs, safety and security costs, and disability access costs from the definition of controlled expenditure.
A review of part 2 of the legislation will take place after the 2015 general election, with a new body set up before the election to collect evidence during the regulated period.
These concessions are significant and show the strength of voluntary sector opposition to the original proposals. But there are still many issues with the proposed legislation, even as amended, and the Commission on Civil Society and Democratic Engagement says that overall the bill still represents a threat to democracy and a disproportionate restriction on freedom of speech and to association.
In particular, the definition of campaigning to promote or procure the electoral success of a party or candidates can still catch campaigning not even mentioning a party or candidate, and can also catch campaigning whose primary purpose is raising policy issues.
The continued inclusion of staff and certain other costs as controlled expenditure will involve monitoring systems that most organisations do not have. One of the amendments proposed by Lord Harries would removed staff expenditure from the definition of controlled expenditure.
The spending limits, even with the government's new increase in the limits for Scotland, Wales and Northern Ireland, are still extremely low, representing a 60% cut from the current allowed level in England, and around 60% in Scotland, Wales and Northern Ireland.
There is no proposal to amend or remove the limits, introduced in the lobbying bill, on controlled expenditure in a single parliamentary constituency. This would be £9,750 over the year before a general election, of which no more than £5,850 can be in the four to five weeks after Parliament is dissolved. Many organisations believe constituency limits are unworkable, because much campaigning reaches people from many constituencies (such as leafletting at a large shopping centre), and are unenforceable by the Electoral Commission. The Commission on Civil Society and Democratic Engagement has recommended that they be scrapped. One of Lord Harries' amendments would limit restrict the definition of constituency expenditure to election material specifically delivered to individuals or households in the constituency.
The Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Bill can be accessed and tracked on the Parliament website via tinyurl.com/mv3xq3r, with up to date information at tinyurl.com/lr7g96e.
The Political Parties, Elections and Referendums Act 2000, which part 2 of the bill will amend, is at www.legislation.gov.uk/ukpga/2000/41/contents.
Keep up to date at www.ncvo-vol.org.uk (in particular the News and Blogs and discussions sections) and www.38degrees.org.uk/campaigns.
For charity law requirements on campaigning, the Charity Commission's Charities, elections and referendums (January 2011) supplements its CC9 Speaking out: Guidance on campaigning and political activities by charities. These are on the Commission's website at tinyurl.com/onlzsnf and tinyurl.com/lqqqsxh. Regardless of what the new legislation does or does not permit, all charity campaigning must be within the Commission's guidelines.
The bill in the House of Commons (July-October 2013)
The bill was introduced in the House of Commons on 17 July 2013, two days before the summer recess. The initial view within the voluntary sector was that it would not have much impact on charities and other voluntary organisations, as they would not be included in the proposed statutory register of lobbyists. However, major concerns emerged during August, as the implications of part 2 of the bill became clearer.
Part 2 is intended to bring "greater fairness to political campaigning", but would require many more charities and other voluntary organisations than at present to register with the Electoral Commission and provide it with detailed expenditure reports, and would put much greater restrictions than at present on the amount registered organisations can spend on campaigning in the year before general elections.
The National Council for Voluntary Organisations, ACEVO, 38 Degrees and other organisations immediately started campaigning. The Electoral Commission, which as regulator for elections enforces statutory controls on electoral activity and spending, said in a briefing for MPs issued on 29 August 2013 that the bill created significant regulatory uncertainty for large and small charities and other organisations that campaign on, or even discuss, public policies in the year before a general election, and imposed significant new burdens on such organisations. It also expressed concern about being given, as the Electoral Commission, too much discretion to interpret what activity would be regulated as political campaigning, and said that some of the controls in the bill could in practice be impossible to enforce.
Among those concerned about the bill there was a strong feeling that the government should put part 2 on hold, so there would be time for consultation on "a solution that addresses concerns about undue influence in politics without the risk of sweeping every charity and community group in the country into a deeply burdensome bureaucratic regime".
There was deep concern that not only had the bill been introduced right before the summer recess, but that the House of Commons second reading (debate stage) was scheduled for 3 September, immediately after the recess (and, as it happened, immediately after the deeply controversial vote on UK military action against Syria). After a heated six-hour debate, a vote on the general principles of the vote was won by 309 to 247 votes, with five Conservative backbenchers voting against the bill.
The House of Commons political and constitutional reform committee, responsible for scrutinising the bill, said in its report on 5 September that the bill had significant defects and should be withdrawn, with a new bill to be produced within six months. If withdrawal was not an option, it made several recommendation including a clearer definition of "for electoral purposes", and not lowering campaign expenditure thresholds.
The next parliamentary stage was committee stage on 9-11 September 2013, with the committee made up of the whole House. Clause 26 in the bill, with the controversial definition of "for electoral purposes", was passed by 296 votes to 247, although the government said it would consult with NCVO, the Electoral Commission, other organisations and the Opposition, and would introduce amendments at the next (report) stage of the process. All of the other clauses in the bill were also passed.
By this time, following a meeting between NCVO and the leader of the House of Commons, the government had committed itself to change the definition of "for electoral purposes" so it would not include charities campaigning as a way of achieving their objects.
The government said it would replace the definition of election activity as one which could have the effect of enhancing the standing of any party or candidate, with the definition of electoral purposes as in existing legislation: an activity that "can reasonably be regarded as intended to procure electoral success" for a particular party, parties or candidate(s).
This amendment was announced by the government on 26 September, along with several others which are intended to:
make clear that only public rallies and events are regulated, and that meetings or events just for an organisation's members or supporters will not be covered by the bill, nor will annual events such as an organisation's annual conference;
ensure that non-party campaigners who respond to ad hoc media questions on specific policy issues are not covered by the bill (but press conferences and other organised media events will be);
ensure that all market research or canvassing which promotes electoral success is regulated.
With these amendments  but no changes to other substantive parts of the bill  the bill went through its report stage on 8-9 October and third reading on 9 October. Unusually for a third reading, it was put to the vote and was approved by 304 votes to 260, with four Conservatives and seven Lib Dems voting against. The majority of 44 was down from 62 at second reading and from 49 for the vote on clause 26 at committee stage.
The bill in the House of Lords (October 2013-January 2014)
Following the third reading in the House of Commons, the bill moved to the House of Lords with the first reading (introduction of the bill) on 9 October, the second reading on 22 October, and the committee stage scheduled for four days starting with 5 and 11 November 2013.
Prior to the bill's second reading in the Lords, the Lords constitution committee published on 16 October a report expressing concern about the effect of the non-party campaigning provisions on "the fundamental common law right to freedom of political expression". It was also concerned about the impact of the bill in Northern Ireland, Wales and Scotland, and the way the bill had been handled. The report says, "The bill was introduced with undue haste, leaving no opportunity for pre-legislative scrutiny and inhibiting the ability of the House of Commons to afford the bill properly informed consideration." The constitution committee's report is at tinyurl.com/ljklqm3.
On 17 October the Commons and Lords joint human rights committee issued a report on the bill, calling on the government "to pause the passage of the Bill to allow for further scrutiny and for further consultation with the Electoral Commission, the Commission on Civil Society and Democratic Engagement and relevant stakeholders". It said there should in particular be more careful consideration of the potential impact on campaigners� rights to free speech and freedom of association. If the government would not pause the bill, the committee recommended removing the proposed registration thresholds and the reduced spending limits. A brief summary of the report, with a link to the full version, is at tinyurl.com/monbubb.
During the second reading, on 22 October, there were strong calls for part 2 of the bill to be amended, withdrawn completely, or paused to allow time for proper consultation. There was also a call for charities to be exempted from part 2, although this would not alleviate the negative effects on non-charitable voluntary organisations.
The Commission on Civil Society and Democratic Engagement published its report and recommendations on 29 October. The main recommendation was for a pause of three months in the legislative process, to allow time for a House of Lords committee to consult, gather evidence, and come forward with fresh proposals on how non-party campaigning should be regulated in the period before elections.
The committee stage in the Lords, with a line by line examination of the bill by the whole House, started on 5 November and was expected to last four days. At this point Lord Wallace of Saltaire, the minister responsible for the bill in the House of Lords, said that in order to allow time for consultation with the Commission for Civil Society and Democratic Engagement and other concerned organisations, the House of Lords committee stage debate on part 2 would be paused until 16 December 2013. This concession was made after crossbench peer Lord Ramsbottom proposed a motion that part 2 should be considered for three months by a specially appointed select committee. When the government agreed to the pause until 16 December, Lord Ramsbottom withdrew his motion.
The government also announced on 5 November that the proposed thresholds at which campaigning organisations have to register with the Electoral Commission would be substantially increased "to ensure that small campaigning groups, including charities, are not caught by the regulatory regime", but did not indicate what the new thresholds might be.
The Commission on Civil Society and Democratic Engagement made clear that this pause, of less than six weeks, would not allow time for the necessary discussions. It was nonetheless able to produce a second report and recommendations on 10 December.
The Electoral Commission also published a briefing on 13 December, prior to the House of Lords debate. This and other Electoral Commission briefings on the debate are at tinyurl.com/oxodhy9.
The House of Lords session on 16 and 18 December 2013 was a committee stage debate, with the committee made up of the whole House. At committee stage, legislation is considered line by line. During this session, an amendment to exclude charities from the lobbying bill was withdrawn. This amendment had been proposed by Lord Phillips of Sudbury and was supported by some charities. One of the reasons for the Lords' withdrawal was that it would have put too much additional pressure on the Charity Commission to monitor campaigning activities by charities.
No amendments to the bill were made at the committee stage, but the government said it would put forward amendments at report stage. These amendments were announced on 9 January 2014, prior to the bill's report stage in the House of Lords on 13 January. The vote on amendments to the bill will take place on 15 January 2014.
The report stage will be followed by the third reading and a vote on the bill, then the amended bill will go back to the Commons, then "ping pong" between the Commons and Lords until there is agreement. It then receives royal assent and becomes law, although does not necessarily come into effect immediately.
The government initially wanted the bill to get royal assent in mid-January, so guidance would be available in time for it to come into effect on 8 May 2014, one year before the 2015 general election. With the regulated period for the general election now likely to start in September 2014 rather than May, there is less pressure to get the legislation approved immediately.
The amazing work of the hastily assembled Commission on Civil Society and Democratic Engagement, backed up by intense campaigning by thousands of organisations and tens of thousands of individuals, has had a huge impact on the bill.
ACEVO announced on 26 September 2013 that it had set up the commission, a coalition made up of charities, campaigning groups, academics, think tanks and online networks, to investigate the impact of the lobbying and campaigning bill on civil society organisations.
Within five weeks it had held evidence sessions in Edinburgh, Belfast and London, received written evidence from dozens of organisations, met with parliamentarians, and published on 29 October 2013, one week before the House of Lords committee stage, a 54-page report full of recommendations.
The report, Non-party campaigning ahead of elections, and a second report published six weeks later on 10 December 2013, are at civilsocietycommission.info/reports.
The central recommendation of the first report was that the government should pause part 2 of the bill to allow for proper consultation and consideration.
If the central recommendation was not implemented, it proposed changes to the bill to limit the damage to democratic engagement of civil society. In general, these called for the current provisions of the Political Parties, Elections and Referendums Act 2000 (PPERA) to be retained, pending consultation and consideration of potential changes beyond the 2015 election. These were under the headings of the definition of regulated non-party campaigning; campaigning materials and activities subject to regulation; registration thresholds; spending limits; constituency limits; reporting requirements; regulation of non-party campaigning in Scotland, Wales and Northern Ireland; coalition working; charities and non-party campaigning; equalities; and human rights.
It also included a recommendation for a joint committee to consider regulatory changes to non-party campaigning beyond 2015.
The commission's second report was published only six weeks later, on 10 December 2013. This report:
establishes six tests for good regulation  criteria upon which any proposals for the regulation of non-party campaigning ahead of elections should be justified;
makes a set of interconnected recommendations that it says will go some way to reducing the risk to democratic engagement threatened by the lobbying bill and uncertainty around the Political Parties, Elections and Referendums Act 2000;
proposes a full and evidence-based review of the legislation governing non-party campaigning which should take place as a matter of urgency after the 2015 general election;
includes case studies of non-party campaigning ahead of elections and compares the likely impact of the lobbying bill proposals and the commission's proposals on the campaigns.
This is a summary of part 2 of the bill as originally proposed, and amendments agreed by the House of Commons in October 2013. It does not reflect amendments subsequently proposed in the House of Lords but not yet approved.
The bill proposes changes to the Political Parties, Elections and Referendums Act 2000 (PPERA), which regulates the campaign activities and finance of non-parties in the run-up to elections. Non-parties are organisations and individuals who are not registered political parties or candidates.
Clause 26 in the bill as originally proposed would have changed the definition of regulated election activity to include not only activities geared to electoral success for a particular party or candidate (as in PPERA), but also activities which have or could have the effect of enhancing the standing of any party or candidate, even if the party or candidate was not mentioned and this was not the intention of the activity. This could have potentially affected any charity, other voluntary organisation or business which ever campaigns on any issue which could become an election issue  even if their campaign was totally apolitical and was not intended to influence an election.
During the House of Commons third reading on 9 October 2013, a Labour amendment that would have limited the legislation to activities whose "primary purpose" was to support a particular candidate or party was defeated by 261 to 298. But a government amendment using the PPERA definition of activities that can reasonably be regarded as intended to procure electoral success for a particular party, parties or candidate(s), was approved. While this is not as good as the Labour amendment would have been, it is certainly better than what was in the original bill. But as NCVO and others have pointed out, even the wording in PPERA has already had a inhibiting effect on campaigning by voluntary organisations in previous elections  and this effect will be even stronger when combined with the other provisions in the bill.
The government did not propose amendments to these provisions in the original bill, and Labour amendments were not accepted. So the following provisions were still in the bill as it went to the House of Lords on 9 October:
a significant increase in the range of regulated activity which counts towards the threshold for registration with the Electoral Commission and the cap on expenditure, to include not only election-directed material, leaflets and advertisements as at present, but also rallies and events, media work, market research such as polling, and transport for the purpose of obtaining publicity (schedule 3);
the inclusion of staff and other costs as part of the costs of election activity by non-party organisations (even though staff and other such costs are not included as election expenditure by registered political parties) (clause 26);
a significant reduction in the campaign expenditure threshold at which a non-party has to register with the Electoral Commission, from £10,000 to £5,000 in England and from £5,000 to £2,000 in Scotland, Wales and Northern Ireland (clause 27);
a significant reduction in the amount that a non-party can spend on election campaigns in the run-up to an election, from a UK total of £988,500 to £390,000 (a reduction from £793,500 to £320,000 in England, £108,000 to £35,000 in Scotland, £60,000 to £24,000 in Wales and £27,000 to £11,000 in Northern Ireland) (clause 27);
a limit on the amount that can be spent in a single parliamentary constituency (clause 28);
new controls on spending that has a significant effect only in particular constituencies or supports a single political party (clauses 28 and 29);
where a coalition of organisations undertakes a campaign, requiring each member of the coalition to include the full amount (not just its portion) in its registration threshold and towards its expenditure cap, and to report the full expenditure on the campaign in its expenditure return to the Electoral Commission;
new or amended reporting requirements on donations towards regulated spending and on campaigners' finances (clauses 32 and 33).
It is an offence not to register with the Electoral Commission if required to do so, or to exceed the expenditure limits when registered.
As under PPERA, election controls will be in effect for a year before UK parliamentary general elections, and for four months before elections to the European parliament. Different periods apply for local elections.
The bill provides that the current PPERA rules on election activities and expenditure will continue to apply in the run-up to the European election from January to May 2014. The new rules will then come into effect in May 2014 in relation to the 2015 general election.
For organisations which are or could be involved in election activities as defined in the new legislation, there will be only a short period to consider the impact of the new rules. And this consideration and any necessary changes or Electoral Commission registration will have to take place while still operating under the old rules in relation to the European election.
Although it is now clear that an activity and its related expenditure will be subject to the controls on non-party campaigning only if it can reasonably be regarded as intended to support or disparage a particular party or candidate, the bill is still ambiguous and could still have a damaging effect on voluntary organisations. This will be particularly acute for non-charitable organisations, which are not subject to charity law restrictions on campaigning for or against a particular party or policy.
Amongst the continuing concerns expressed by the Electoral Commission, NCVO and others are:
the government has not set out a clear rationale for many of the changes in the bill, so it is difficult to assess the government's policy objectives and whether the bill will achieve them;
there is still considerable lack of clarity about how the bill will work in practice; this lack of clarity will affect both large and small organisations, but will disproportionately affect small organisations with less capacity to address regulatory issues;
the proposed list of activities that could count towards controlled expenditure (rallies and events, media work, market research such as polling, and transport for the purpose of obtaining publicity) remains neither clear nor workable, and hugely increases the activities which count towards the threshold for registration with the Electoral Commission and the cap on election expenditure;
the inclusion of staff costs and other overheads will also significantly increase the amounts that count towards the registration threshold and will mean they hit the expenditure cap more quickly;
for non-charitable organisations, which are not subject to the charity law restrictions on campaigning for a particular party, candidate or policy, the threshold at which they will have to register with the Electoral Commission is halved, the amount they can spend on campaigning during an election period is reduced by 60-70%, and what counts as expenditure is significantly increased;
many organisations will have to consult the Electoral Commission before undertaking campaigning activity in an election period, to confirm whether the new rules apply to them;
the assurances given by government ministers that organisations will still be able to support specific policies that might also be advocated by political parties have not been met;
organisations involved in coalitions or joint campaigns remain jointly responsible for all expenditure and have to report joint spending, so lower spending limits and registration thresholds, along with the wider definitions of campaign activities, will increase the likelihood that organisations will need to register and report to the Electoral Commission even if their individual spending within the coalition is well below the threshold and cap;
organisations which have to register with the Electoral Commission will be subject to what has been consistently referred to as an excessively bureaucratic and burdensome regime;
carrying out regulated activities when not registered with the Electoral Commission (if the expenditure on them is more than the registration threshold), or being registered and spending more than the allowed limits, are both criminal offences;
the uncertainty about whether an activity could be defined as regulated campaigning, and the risk of criminal liability if an organisation does not register with the Electoral Commission when it should, could deter organisations from undertaking activities that they are actually allowed to do;
even as amended, the bill has the effect of curbing freedom of speech around elections;
the Electoral Commission is concerned that with the new rules coming into effect in May 2014 (for the year before the general election) there will not be enough time to clarify what is and is not an election campaign or regulated activity, and to develop guidance for organisations;
the Electoral Commission is also concerned that the bill effectively gives the Commission a wide discretion to interpret what activity will be regulated as political campaigning, which could lead to contentious interpretations that create even more uncertainty for affected organisations;
the Electoral Commission also says some of the new controls in the bill may in practice be impossible to enforce.
GUIDANCE ON POLITICAL ACTIVITIES BY CHARITIES IN NORTHERN IRELAND
Added 29/1/12. This information updates s.46.1.2 in The Russell-Cooke Voluntary Sector Legal Handbook (VSLH3).
The Charity Commission for Northern Ireland published guidance in June 2011 for charitable organisations involved in campaigning and political activities, which can be accessed via tinyurl.com/43orbj9. It is similar to the Charity Commission's guidance for charities in England and Wales (CC9), at www.charitycommission.gov.uk/Publications/cc9.aspx.
CAMPAIGNING IN THE RUN-UP TO ELECTIONS
Updated 24/3/14. This information updates s.46.5 in The Russell-Cooke Voluntary Sector Legal Handbook (VSLH3).
The Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Act 2014 (the Lobbying Act) received royal assent on 30 January 2014, with most of part 2 (ss.26-39), on non-party campaigning, coming into effect immediately. Non-party campaigning means campaigning by individuals or organisations who are not registered candidates or political parties.
The regulated period for the May 2015 general election (the first period governed by the new rules) started on 19 September 2014, the day after the Scottish referendum, and ends on polling day, 7 May 2015.
Despite some very significant changes achieved by a massive voluntary sector campaign as the bill was going through Parliament, there are still deep concerns about the impact part 2 will have on campaigning by charities and other organisations during the period before elections.
Potential impact of the new rules includes:
the administrative difficulties in knowing which expenditure is and is not classed as controlled expenditure, and in particular separating out the staff and other associated costs which are included;
confusion for charities because an activity may be completely legitimate under charity law, but still get caught as regulated activity under the Lobbying Act;
uncertainty about whether an activity is regulated, and the risk of criminal liability if an organisation does not register with the Electoral Commission when it should, could make organisations risk-averse and deter them from undertaking activities that they are actually allowed to do;
even as amended, the act has the effect of restricting freedom of speech in the period before elections, and an organisation may be tempted deliberately to ignore the law, as some people are advocating  with the result that the organisation or its governing body members could be fined for breach of electoral law, and/or that governing body members could be held personally liable to repay to the organisation any expenditure it incurred on campaigning activities carried out unlawfully;
the Electoral Commission has expressed concern that the act effectively gives it wide discretion to interpret what activity will be regulated as political campaigning, which could lead to contentious interpretations that create even more uncertainty for affected organisations;
the Electoral Commission has also said some of the new controls in the bill may in practice be impossible to enforce.
The Electoral Commission is the regulator for election funding and campaigning. Its full, detailed guidance on the new rules was expected in July 2014. In the meantime it is issuing regular updates summarising the new legislation. These have included summaries of changes brought in by the act (2 February 2014), activities regulated under the new rules (23 February) and the rules on registration with the Electoral Commission (17 March). These are at tinyurl.com/ofn33xo.
If your organisation engages in any sort of campaigning which could have the effect of influencing voters in the period before an election  even if this is not in any way its intention  it is essential to sign up for future Electoral Commission updates at tinyurl.com/ofn33xo.
NCVO issued an 8-page Charities and the Lobbying Act: Frequently asked questions on 11 March, covering not only the basics of the legislation but also questions such as what happens if a charity has been campaigning on an issue that receives the endorsement of a particular party or candidate; what happens once an organisation has registered; whether a hustings organised by a charity, a manifesto published by a charity or a fringe event organised at a party conference would come within the scope of the rules; and many more. The briefing is on the NCVO blogs website via tinyurl.com/pnnxlck.
The Charity Commission, Office of the Scottish Charity Regulator and Charity Commission for Northern Ireland are working with the Electoral Commission to produce guidance specifically for charities in summer 2014. In England and Wales this guidance will update the Charity Commission's current guidance on charities, elections and referendums, which supplements CC9 on campaigning and political activities, at tinyurl.com/lqqqsxh. Even if an activity is allowed under the Lobbying Act, all charity campaigning must comply with charity law and be within the Commission's guidelines. And even if it complies with charity law, if it takes places during the run-up to an election it must comply with the Lobbying Act rules on controlled expenditure and Electoral Commission registration. It's not an either/or.
The Charity Commission has said, "it is really important that charities understand that registering with the Electoral Commission will not mean that charities are failing to comply with charity law on campaigning and political activity. Charity law makes quite clear that political activity and campaigning can be legitimate and valuable activities for charities to undertake as a way of furthering their charitable purposes. This legislation changes the rules that apply in the run-up to general elections, but does not challenge the important principle that charities are free to campaign, so long as they do so to further their mission".
The Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Act 2014 is at www.legislation.gov.uk/ukpga/2014/4/contents.
Part 2 of the Lobbying Act amends part 6 of the Political Parties, Elections and Referendums Act 2000 (PPERA), which regulates the campaign activities and finance of non-parties in the run-up to elections. This act is at www.legislation.gov.uk/ukpga/2000/41/contents.
The new legislation will have a significant impact on campaigning, especially for larger organisations, and will be challenged again when it is reviewed after the 2015 general election. However, it is not as bad as it could have been, following a massive campaign by the voluntary sector  in particular 38 Degrees (www.38degrees.org.uk) and the hastily assembled but wonderfully effective Commission on Civil Society and Democratic Engagement (civilsocietycommission.info).
Controlled expenditure. Spending on election material distributed to the public in the run-up to an election, and associated staff costs and overheads, have been regulated since the Political Parties, Elections and Referendums Act 2000. But under the Lobbying Act 2014 s.26, expenditure on a much wider range of activities will be controlled if the activity "can reasonably be regarded as intended to promote or procure electoral success at any relevant election" for one or more parties, or for one or more parties or candidates who advocate or do not advocate particular policies. S.26 makes clear that this covers such campaigning even if it does not mention any party or candidate, and even if its purpose is not to influence the election.
Regulated campaign activities as defined in schedule 3 of the Lobbying Act now include, in addition to the production or publication of election material made available to the public at large or any section of the public:
canvassing, or market research seeking views or information from, members of the public or a section of the public;
press conferences or other media events organised by or on behalf of the non-party campaigner;
transport by any means of persons to any place or places in connection with publicising the campaign;
public rallies or other public events, but with some exceptions (see below);
plus the associated staff costs and other expenses incurred in relation to any of the above, unless set out below.
Until now, the Electoral Commission has not considered an organisation's members or committed supporters (for example, regular donors or people actively involved in the organisation) to be "the public". In light of the new legislation, it is currently reviewing its guidance on who does and does not constitute the public or a section of the public.
Under the Lobbying Act schedule 3, expenditure is not controlled if it relates to:
publication (other than an advertisement) in a newspaper or periodical, or broadcast on the BBC, Sianel Pedwar Cymru or a service licensed under the Broadcasting Acts 1990 or 1996;
translation of material from English into Welsh or from Welsh into English;
reasonable travel costs, accommodation or personal needs of an individual;
reasonable expenses incurred in relation to an individual's disability (as defined in the Equality Act 2010), either for an individual working on the campaign or to make an activity accessible to a member of the public;
expenses incurred in relation to services provided voluntarily by an individual, in their own time and free of charge;
safety and security costs for public rallies and other public events;
public rallies and other public events that are the non-party campaigner's annual conference, or a public procession or protest meeting taking place under the provisions of the Public Processions (Northern Ireland) Act 1998.
Many of these exceptions were introduced following lobbying by the voluntary sector. However, the sector was not successful in getting staff costs excepted. This really was contentious: in the final "ping pong" stages of the bill's passage through Parliament, the House of Lords accepted an amendment to exclude background staff costs from controlled expenditure; the House of Commons did not accept the amendment so it went back to the House of Lords, where the vote was 245-245. Because it had not been approved, the amendment did not succeed  so staff costs must now be included.
The Electoral Commission is working on its guidance on staff costs and other associated costs of regulated activity. It will emphasise making an honest and reasonable assessment of the time and other costs involved with regulated activities, as part of the overall work of relevant staff members and the organisation as a whole. Time sheets and similar detailed breakdowns are unlikely to be required.
Regulated period. The regulated period for general elections usually one year before the election, but for the 2015 general election only, the regulated period will be 7.5 months, starting on 19 September 2014 (the day after the Scottish referendum) and ending with election day on 7 May 2015. The sector campaigned for this so the Electoral Commission would have more time to produce guidance before the regulated period begins.
Although the first regulated period will be only 7.5 months, the full amounts for registration thresholds and spending limits will apply  they will not be reduced on a pro rata basis.
For elections to the European parliament, the regulated period is four months. Different periods apply for local elections.
Threshold for registration with the Electoral Commission. An organisation must register with the Electoral Commission if its controlled expenditure is going to exceed the registration threshold. The lobbying bill as originally proposed would have reduced registration thresholds from £10,000 to £5,000 for expenditure in England, and from £5,000 to £2,000 each for expenditure in Scotland, Wales and Northern Ireland. Following campaigning by the sector about the number of small organisations that would be caught by these reductions, the government agreed to double the threshold, from the previous £10,000 to £20,000 in England, and from £5,000 to £10,000 in Scotland, Wales and Northern Ireland.
Any organisation which carried out activities which involve controlled expenditure is referred to in the legislation as a third party. If it is registered with the Electoral Commission, it is a recognised third party.
With the doubling of the current registration thresholds, most organisations which carry out small scale campaigning will not have to register with the Electoral Commission, with all of the accounting and reporting requirements that this involves. They will, however, need to monitor controlled expenditure to ensure it does not go over the threshold, and if it looks like it might go over, they must register before it does. So they may still need to have accounting systems in place to carry out this monitoring.
A decision about registering with the Electoral Commission should be made at board level, after proper consideration of the reasons for carrying out campaigning activities that are regulated under the Lobbying Act, and for carrying them out at a level that requires registration. The board should also ensure procedures are in place to monitor controlled expenditure. Organisations registered as companies which carry out regulated activities may also need a resolution by the company members [see Company law implications, below].
It is an offence not to register with the Electoral Commission if required to do so, or to exceed the limits on controlled expenditure when registered.
Limit on controlled expenditure. An organisation which is not registered with the Electoral Commission cannot have controlled expenditure of more than the registration threshold. For organisations registered with the Commission, the Lobbying Act has reduced the spending limit for controlled expenditure in England from £793,500 to £319,800, a 60% reduction. Campaigning as the bill was going through Parliament did not succeed in getting this increased.
The government initially proposed to reduce the limit from £108,000 to £35,400 in Scotland, from £60,000 to £24,000 in Wales, and from £27,000 to £10,800 to in Northern Ireland. Following campaigning, these proposed amounts were each increased by £20,000, to £55,400 in Scotland, £44,000 in Wales, and £30,800 to in Northern Ireland. These means there is a 49% reduction in maximum controlled expenditure in Scotland and a 27% reduction in Wales, but a 14% increase in Northern Ireland.
For organisations which campaign across all of the UK, the total UK-wide limit is reduced from the previous £988,500 to £450,000  an overall 54% decrease.
Apart from organisations which campaign only in Northern Ireland, these new limits will mean a really significant decrease in the amount of campaigning which can be undertaken in the run-up to an election. And the amount of activity will be decreased much further, now that expenditure is controlled not only on election materials, but on so many other activities and their staff costs.
Constituency and other spending limits. Within the spending limits for each part of the UK, s.29 brings in a new limitation on expenditure focused on a particular constituency or constituencies, and s.30 brings in new limits on spending aimed at promoting one political party (which of course charities could not do, but non-charities might be able to). The constituency limit is £9,750 over the year before a general election.
Many organisations believe constituency limits are unworkable, because much campaigning reaches people from many constituencies (such as leafletting at a large shopping centre). Campaigners as the bill was going through Parliament recommended that they be scrapped, or at least should be amended to include only election material specifically addressed or delivered to individuals or households in the constituency, and unsolicited telephone calls made to such individuals or households. This didn't happen.
Joint campaigns. As originally proposed, every organisation which took part in a campaign with other organisations would have had to register with the Electoral Commission if the total amount spent by the joint campaign was expected to exceed the registration threshold, and would have had to report to the Commission. Following lobbying by the voluntary sector, s.27 of the Lobbying Act allows one "lead campaigner") to register and account for a coalition campaign, rather than every organisation involved.
The other organisations involved must be named as "minor campaigners". Although these organisations will not have to report directly to the Electoral Commission, they will need to provide required information to the lead campaigner, so will still need to keep accounting records showing their expenditure on regulated activities.
Reporting of donations for controlled expenditure. S.33 of the Lobbying Act introduces complicated new rules requiring organisations registered with the Electoral Commission to report donations received for the purpose of meeting controlled expenditure. During the regulated period before a general election, these reports must be made quarterly before Parliament is dissolved, and weekly in the period between dissolution of Parliament and the election. This will involve significant admin and compliance costs.
Review of the Act. As a result of campaigning by the sector, a review of the legislation on non-party campaigning will take place after the 2015 general election, with a new body set up before the election to collect evidence during the regulated period. Lord Harries of Pentregarth, who as chair of the Commission on Civil Society and Democratic Engagement which was deeply involved with the amendments to the lobbying bill, said in early March that the Commission has now closed down, but will reconvene to look at the Electoral Commission guidance when it is issued, and will contribute to the post-election review of the act.
At the end of February David Cameron said, in a letter to Sir Stephen Bubb of ACEVO, that "the legislation will not affect the majority of charities and other campaigning organisations", and that it "will only apply to third party organisations or charities who spend money to procure the electoral success of a particular political party or candidate." These statements are likely to be the touchstone against which the voluntary sector assesses the impact of the new rules.
Part 14 of the Companies Act 2006 (ss.362-379) is likely to apply to any registered company, including a company limited by guarantee or community interest company, which carries out campaigning activities which meet the definition in s.26 of the Lobbying Act, i.e. an activity which "can reasonably be regarded as intended to promote or procure electoral success at any relevant election". Even if the company's expenditure is not high enough to meet the threshold for registration with the Electoral Commission, its expenditure on such activities would be defined as political expenditure under s.365 of the Companies Act, and would require a resolution in a specified form by the members of the company.
The same rule on authorisation by the members of the company applies to any company which makes donations totalling more than £5,000 in any 12-month period to political parties and/or political organisations. Under s.363 of the Companies Act, a political organisation is any organisation which "carries on, or proposes to carry on, activities that are capable of being reasonably regarded as intended to affect public support for a political party or an independent election candidate, or to influence voters in relation to any national or regional referendum in the UK or another EU member state".
These requirements are not new, but companies may not have been aware of them.
Part 14 of the Companies Act 2006 is at www.legislation.gov.uk/ukpga/2006/46/part/14.
CAMPAIGNING IN A PRE-ELECTION PERIOD
Added 7/3/10, links updated 4/4/10. This information updates s.46.5 in The Russell-Cooke Voluntary Sector Legal Handbook (VSLH3).
All organisations. All organisations, whether charitable or non-charitable, must comply with electoral rules when an election has been called or when it is clear that one is going to be called. For example, publications or advertisements about candidate(s) or their views may generally be issued only with the prior consent of the election agent(s), and public meetings and public displays about one or more candidates or their views may be organised only with such consent. Total expenditure of more than a specified amount during the election period also requires consent.
An organisation which spends more than £10,000 on "election material" in England (or £5,000 in the rest of the UK) in the 365 days before an election is likely to need to register with the Electoral Commission as a recognised third party. Election material is defined very widely, and can include anything that might be seen as enhancing the standing of parties or candidates who hold particular views or support particular policies  even if the material does not mention a party or candidate, and is not intended to promote a particular party or candidate.
Information about the rules is available from the Electoral Commission, www.electoralcommission.org.uk.
The National Council for Voluntary Organisations' summary of the rules, Voluntary organisations and electoral law: Campaigning during a general election, is at www.ncvo-vol.org.uk/node/1027.
Charities. All charities, regardless of whether they are registered with the Charity Commission, must comply with restrictions on political activities and campaigning at all times, not just in the run-up to an election. In particular, they must not support a particular party or candidate, and must not make any donations to political parties.
The rules on what charities can and cannot do are explained in the Commission's CC9 Speaking out: Guidance on campaigning and political activities by charities, at www.charitycommission.gov.uk/publications/cc9.asp.
Supplementary guidance specifically on what charities can and cannot do in the run-up to an election was updated in January 2010. The guidance covers contact with electoral candidates, use of charity facilities by candidates, publicity about policy issues, conflicts of interest where, for example, an employee is standing as a candidate, and similar issues.
It also includes guidance on engagement with minority parties, and says that it is "open to charities not to invite a representative from a political party which advocates policies which are in contravention of the charity�s objects, or whose presence or views are likely to alienate the charity�s supporters".
Charities and elections is at tinyurl.com/y85cl9f (new web address March 2010).