---

Political Parties and Elections Bill

I thank the right hon. Gentleman for that. At least it was some progress. The third and final thing that the Constitutional Affairs Committee and Hayden Phillips dealt with was the vexed issue of the relationship between the Labour party and the unions. Both the Committee and Hayden Phillips were clear that there should be a compromise that would take us from where we are now, so that the Labour party cannot just stay where it is, but not be a threat to the fundamental link between the Labour party and the unions. It would be quite inappropriate to try to destroy another political party's historical method of operation by changing party funding law. There should therefore be a compromise—the Boston compromise, for those members of the Committee who were there. It is important to distinguish between donations by the unions as organisations, which should be subject to the same donation cap as anything else, and contributions by individual members to the Labour party made via the political levy. From the point of view of the law, the best way to see the issue—the Labour party can see it differently if it wants to—is that the union is, to use an American phrase, bundling the small contributions of individuals. Each contribution does not violate the cap. They might in total violate the cap, but such contributions are treated not as a single donation, but as the bundling of individual donations. However, if that distinction is to be made and if the unions are to be treated as bundlers in respect of at least some of the money that they give—indeed, perhaps the vast bulk of it—there must be some extra regulation, so that regulators can tell whether a payment is a donation by the organisation or is bundled individual contributions. There must be the possibility of a clear audit trail from the individual contribution through to the party. It must be clear that the money was in fact a contribution to the party via the union, not something else.