Contribution
My Lords, I declare my interest as a trustee of Democratys, a charity focused on educating the public about threats to our democracy.
There are three areas of the Bill that I want to focus on in the short time available. The first is votes at 16, which is one of those changes that had been a long time coming and was absolutely inevitable once 16 and 17 year-olds gained the vote in Scotland and Wales. I note the comments in the excellent maiden speech given by the noble Lord, Lord Macintosh, about the seriousness with which 16 and 17 year-olds in Scotland approach the vote, and I think we would see that elsewhere.
The second issue is online abuse in elections. The Bill currently does not mention online abuse once. Elections are high-risk periods for our democracy, and the Speaker’s Conference inquiry into the security of MPs concluded that online abuse presents a serious threat to democratic participation. As has been mentioned, the Electoral Commission report today on this year’s local and mayoral elections showed that such abuse is absolutely rife. That is before we get to the threat posed by deepfake technology, which is also a rapidly growing threat to our elections. I fully support the calls by the Women’s Democracy Group and the Online Safety Network, mentioned by others, for a code of practice in making tech firms accountable for taking steps during election periods to address the risks of online abuse of candidates, particularly women. I speak from some limited personal experience, because it has unfortunately got a lot worse for those standing in elections now. The Minister should certainly expect an amendment on that issue.
I want to focus particularly on crypto asset donations. I note that the Government introduced Clause 61 in the House of Commons, but it is not clear whether it is a moratorium or a ban. The Explanatory Notes carefully say that it is a restriction. At the moment, the clause is unclear as to what it is truly trying to achieve, which should be, as we have heard, a safer and more resilient democracy free of foreign interference. There are three key reasons why a moratorium would do the job that I think a majority in this House seems to want.
First, without a clear route to a workable system, we are left with a ban which simply pushes the risk upstream rather than addressing it. Crypto donations would not be made safer or more traceable and the Electoral Commission and other bodies would still lack the powers and skills needed to supervise the system properly. Of course, a future Government could reverse a ban. Building a trusted, functioning system makes it harder to dismantle than a simple ban. Secondly, the tools to build a workable system exist. There is the incoming regime for crypto service financial providers which would offer the opportunity to align that with the political finance regime, so that third-party providers could conduct anti-money laundering and “know your donor” checks on behalf of political parties. Thirdly, there should be a role enshrined for the Electoral Commission and, most importantly, both Houses of Parliament in lifting that moratorium when we are confident that such donations could be permissible.
Sir Philip Rycroft recommended that the Bill legislate for a moratorium and
“a power to end the moratorium only once Parliament and the Electoral Commission are assured that relevant regulation is effective”.
The Government accepted this recommendation, but the new clause currently lacks clarity on the conditions and process for ending it. That leaves a gap between what has been said and what has been drafted. If the Government do not revise this clause, amendments will be laid to ensure that foreign interference in our democracy via crypto donations or any similar thing—meme coins are included as well—is properly identified and stamped out.
I leave the Minister with three questions, which I hope that she might answer today, but if not, I would be delighted if she would write to me. First, what are the Government’s plans for developing and testing the future regulatory system on crypto asset and other kinds of related donations? Secondly, what additional resources, expertise and enforcement powers will be provided to the Electoral Commission, and how will they be provided? Thirdly, will she commit that both Houses of Parliament would be required to approve any decision to lift such a prohibition?