Selling reform

TCS on Cash-for-honours:

There is a dilemma at the heart of politics in Britain. Election costs have risen as party memberships have collapsed. The major parties have faced cash-flow crises and are now drowning in debt. If they did indeed attempt to bridge their funding gap by exchanging peerages for cheap loans, they would have been continuing a venerable tradition of honours-related corruption dating back to at least the time of Lloyd George. Can politicians ever be free of the temptation to whore our upper house?

If it is cash the parties need, a realistic reassessment of their finances and obligations might go some way towards assuaging concerns over corruption. Indeed, a major review of party funding, led by a respected former civil servant, Sir Hayden Philips, is soon to publish its findings. Disagreement between the parties has so far delayed a final report, but an interim assessment was released in October and, while the role of the unions bankrolling Labour remains contentious, Philips retains hope of common ground on capping campaign expenditure and increasing state funding. Even if party finances were watertight, however, so long as politicians are empowered to nominate peers a whiff of corruption will remain. Party coffers are not politicians’ only concern, and among those who lent to Labour and were then offered Lordships were Barry Townsley and Sir David Garrard, both of whom had also given money to Tony Blair’s pet education project of city academies. The only way to ensure that peerages are not exploited for party political ends is to abandon nomination. But current Government proposals are to have a partially elected upper house, with 30% of peers nominated by the parties (and vetted by the Appointments Commission, alongside 20% nominated by the Commission itself).

What might an alternative look like? Well, one rarely considered option is to do away with an upper chamber altogether. All the Scandinavian countries, for example, manage without one. But such unicameral countries are often small and homogenous, and abolishing the Lords would mark a dramatic and unpopular break with British tradition. The Lords’ functions in the parliamentary system - scrutinising legislation, holding expert debates and obliging the government to reconsider legislation - retain utility. But what composition of the Lords would be best to fulfil these roles? A wholly elected upper house would have the benefit of democratic purity, but would represent yet another tier of power for career politicians to colonise, and would soon chafe at a mere advisory capacity. Perhaps if Britain operated with a limited state we could afford a governing class wholly detached from wider society. But British government is a leviathan: public expenditure accounts for over 42% of GDP. If civil society isn’t to be suffocated by the state it cannot be delineated from politics - experts need to operate on the inside too. But wholly appointed bodies suffer from a lack of democratic legitimacy, and even a partially appointed organ could potentially generate the uncomfortable situation of elected representatives being outvoted by appointees.

So why not marry nomination and election? Rather than purely political party lists (assuming the Lords to be elected by Proportional Representation) on top of nominees, oblige the parties to nominate candidates to their lists that pass Appointments Commission criteria on merit for their expertise and propriety. Rather than guaranteeing the parties an appointed 20% of the upper house on top of their elected representatives, put these vetted lists to the electorate, and let the parties fight for a share of the house against a list drawn up by the Appointments Commission itself. A Commission list would provide a rare opportunity to vote for independence, integrity and wisdom, restoring much-needed confidence to British politics. Amid general disenchantment with politicians and parties, I dare say such a list would do quite well.