Are Both Sides Playing By The Referendum Rules?

Heavy government spending and foreign intervention on behalf of the Remain camp have sparked suspicion that the law is being broken

Barring a landslide, the implications of the EU referendum will still be unclear once the votes have been counted and announced. If there is a majority for Britain’s leaving the EU, there will remain years of negotiation about the terms of disentanglement. And who is to exclude a further referendum about these terms? The formality is that exit from the EU must be completed within two years from the date on which a member state gives notice of its intention to leave. However, in the event of a “Leave” vote on June 23, the UK government is likely to enter into prolonged talks, perhaps lasting for years, before it starts this two-year clock. This is clear from a briefing from within the “Leave” campaign.

If the “Remain” camp wins, the substantive and political outcomes will also be unclear. Will the EU commitment negotiated by Prime Minister David Cameron that the UK will be exempt from “ever closer union” provide real protection against membership of a developing European federation? Will the EU’s highest court in Luxembourg use the Charter of Fundamental Rights introduced by the Lisbon Treaty to ride roughshod over the House of Commons? Will a referendum victory for Cameron end divisions over the issue of Europe within the Conservative party? Could it even have the opposite effect?

Whether or not the anti-EU forces among the Conservatives accept the result in the event of a pro-European verdict by the voters will depend to a significant extent on the perceived fairness or bias of the referendum process itself. Cries of “foul” will undoubtedly be dismissed as sour grapes but they may well resonate if they are credible.

At this stage, it is hard to judge either the fairness of the referendum rules themselves or whether they are being honoured. A certain amount of grumbling is only to be expected. We are already witnessing bad-tempered quarrelling about the rules of the game to the point at which the chair of the House of Commons select committee responsible for constitutional affairs, the Brexiteer Tory MP Bernard Jenkin, has used Cameron’s appearance on May 4 before the Liaison Committee of the House of Commons to threaten the Government with a legal writ.

It is important to distinguish between several different aspects of discontent as well as between the available evidence for them. The most provocative charges concern alleged dirty deals by the Number 10 team to obtain campaign funds, favourable publicity and the backing of the trade unions as well as parts of the pro-Tory press. So far, this gossip has filtered out mainly through channels such as Private Eye and the website of the blogger Guido Fawkes. A charge made directly to the Prime Minister during his appearance before the Liaison Committee was that he had done a deal with Len McCluskey, leader of the mighty Unite trade union: in exchange for a hefty trade union financial contribution to the “Labour In” campaign, the government would amend its proposed trade union legislation. As Polly Toynbee reported in the Guardian, the Prime Minister “had to call off the dogs and accept the Lords amendments to his flagship trade union bill to have any hope of getting the unions out actively campaigning for remain. . . . Cameron had to do it. He needed unions to fund Alan Johnson’s impoverished Labour In campaign.”

According to McCluskey’s interview with the Guardian, published on the day Cameron was questioned by the Liaison Committee, the Conservatives “realised they needed the trade unions to campaign to stay in the European Union. ‘The European referendum came in to play here. I think the Tories recognised that they needed the support of the Left in its broadest context within the UK to sustain the remain vote. That played a part in the thoughts and the considerations and the discussions that have taken place,’ he said.”

The merit of the charge is unproven, especially since the government was already facing opposition from Conservative peers to aspects of the Trade Union Bill and had suffered defeats in the House of Lords as a consequence. In any case, for those primarily interested in constitutional conventions and in referendum law, there are more pertinent questions.

In 2000, Tony Blair’s Labour government enacted legislation designed to control the funding not only of election campaigns but also of referendums. The Political Parties, Elections and Referendums Act (PPERA) had three main objectives: to limit the cost of national campaigns, to ban foreign donations to campaigns, and to require transparency of donations above a given threshold. Expenditure by candidates on constituency campaigning had already been subject to controls introduced as far back as 1883.

Laws designed to regulate political funding are notoriously tricky and are subject to loopholes and ambiguities. These lead to misunderstanding as well as litigation. Terms which seem simple enough — “donation” or “publication” or “campaign” — turn out to be legal minefields. Thus, PPERA attempted to define “donations” as including the provision of “services”. These “services” were to be included as “notional” donations at rates no lower than estimated market rates with a maximum discount of 10 per cent. However, voluntary “services” could be provided in a donor’s “free time” without being counted. These obscure provisions may — as we shall see — have a vital relevance to the referendum campaign. According to PPERA, the limits on campaign spending apply to a set period of time of up to six months before a referendum. For the EU referendum, the campaign period started on 15 April. The purdah period for publications produced by the Government is shorter — only 28 days. When the government circulated to each household a brochure setting out the case against voting to leave the EU, it was following the letter of the law. It circulated the literature in April before the official campaign period started. Whether it was acting in the spirit of fairness has elicited differing views.

A point of potential legal conflict is whether materials supporting the “Remain” case posted by the government on the internet before the 28-day purdah period then have to be removed. Bernard Jenkin had clearly taken legal advice when he questioned Cameron on May 4. He complained that the Cabinet Secretary, Sir Jeremy Heywood, had written to tell him that such material would remain on the internet. Jenkin stated that the Speaker’s Counsel had advised that it was “abundantly clear” that this would contravene PPERA. Cameron replied that this seemed an “extreme” interpretation of Section 125 of the Act. Jenkin then cited a 1937 precedent about the meaning of the term “publication” as it might apply to an internet post and warned Cameron either to accept his interpretation and remove any pro-Remain literature from official websites 28 days before the poll or “to expect a letter before action and, if we can raise the money, expect a writ”.

Following this tense exchange, the conflict over this specific aspect of the referendum rules has deepened. Cameron informed the House of Commons’s constitutional committee (chaired by Jenkin) that the government’s legal advisors confirmed the legality of the government’s position; the Electoral Commission gave advice half way between the government’s position and that of Jenkin. On May 17, the Speaker’s Counsel — the Commons in-house lawyer issued advice which fully backed Jenkin’s argument that the government would be acting illegally if it continued to display on its websites pro-Remain literature published before the 28-day purdah period. A real mess.

The question of publication of pro-EU literature by the government during the four weeks before the poll and free of the constraints of the spending limits imposed by PPERA is not the only point of possible legal conflict. Nor is it necessarily the most significant. A separate question arises from the active involvement of leading foreign politicians in the campaign. US President Barack Obama used a visit to London to campaign explicitly and repeatedly in favour of continued UK membership of the EU. It has been reported that former President Bill Clinton is planning to do the same. This is apart from the information activities of EU organs.

Are such activities permitted by PPERA? It will be recalled that foreign donations are prohibited (to be precise, donations above the disclosure threshold of £500). “Permitted participants” are defined as “registered parties”, UK residents or bodies permitted to make UK political donations (a trade union or a company “which carries on business in the United Kingdom”). It is reasonable to argue that a speech by Obama or Clinton in favour of “Remain” is impermissible. They are not “permitted participants”; their campaign speeches arguably constitute a “service” and are thus notional donations as defined by PPERA. Given the rate normally demanded for speeches by ex-presidents of the US, their notional value is very large — certainly above £500. Would such speeches be covered by the exemption for services provided in the donor’s “free time”? Are serving officers exempt from the rules? If so, why?

I should make clear that I raised the matter of the ambiguities of the referendum rules under PPERA well before the current referendum was envisaged. This was in evidence both to the Committee on Standards in Public Life and to the Political and Constitutional Reform Committee of the House of Commons in July 2010 when the immediate issue was the planned referendum on reform of the voting system. The objective is not to take sides on ongoing conflicts about the rules but to make an appeal for greater clarity.

Following the furore in 2006 over alleged “Loans for Lordships”, a matter which had revolved around the uncertain legal definition under the terms of PPERA of loans at under the market rate, the Committee on Standards recommended in its 2007 review of the Electoral Commission that the Commission should in future be prepared to offer advice in real time about controversial aspects of PPERA. To be precise: “The Electoral Commission should establish the practice of issuing timely advisory opinions, based on sound and competent legal advice, on areas of concern or uncertainty about the practical interpretation of the relevant legislation.”

Whether those dissatisfied with the government’s interpretations of its legal obligations under the terms of referendum would be better advised to go directly to the courts or to ask for an advisory opinion from the Electoral Commission is unclear. It also is unclear whether the recommendation from the Committee on Standards in Public Life implies that the Electoral Commission should in any case provide advisory rulings on the grounds of “uncertainty” about the meaning of the 2000 Act.

There is an additional set of issues involving constitutional conventions. Though several members of the Cabinet openly support the “Leave” campaign against the wishes of the Prime Minister, Cameron continues to represent “the government” as a whole. The pro-EU brochure sent to every household to advocate Remain was sent not in the name of the pro-Remain majority of the cabinet but in the name of the entire government. Apart from their anti-EU stances, the cabinet supporters of exit from the EU continue to be bound by collective cabinet responsibility. This deters them from undermining statements by their “Remain” colleagues. Moreover, the civil service is acting on behalf of the Prime Minister; anti-EU ministers reportedly are not being permitted to ask their officials to prepare anti-EU briefing materials.

When the major UK political institutions and a majority of senior figures feel so strongly bound by the status quo of the European Union and thus by the pressures of an ever more powerful Brussels bureaucracy, it is hard to devise referendum rules which provide a balance of opportunities for advocates of the opposing sides of the argument about continued British membership. The referendum is an imperfect democratic device.

After June 23, the Law Commission (yet another body), which is currently considering some basic reforms of UK electoral laws, will be able to use the experience of the EU referendum to suggest useful legal amendments. Whether there will be another referendum in the foreseeable future of nearly the same importance is a wholly different matter.

It is more important to seek to adjudicate and to clarify the rules of the ongoing referendum — if possible by agreement — before it is too late.

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