Employee Shareholding and Participation in Corporate Governance

Lord Haskel Excerpts

Thursday 11th October 2018 Lords Chamber

Asked by

[Lord Haskel]

To ask Her Majesty’s Government what assessment they have made of proposals for greater employee shareholding and participation in corporate governance.

[Lord Haskel (Lab)]

My Lords, this is a topic on which there is a surprising amount of agreement. It is because of the increasing erosion of public confidence in business that all the recent party conferences discussed it. They debated how to reshape business and shake up the way it works. It was caused by worries about the energy companies ripping off their loyal customers, and drew approval at both the Labour and Conservative party conferences. Disgust at the bonus paid to the chief executive of a housebuilding firm in York, which would pay to house all the homeless there, also drew cheers at both party conferences. This puts intervention by government on to the political agenda.

So what is to be done? There seems to be a degree of unanimity. Both parties agree on the need for greater boardroom diversity, with employees being an essential part of that diversity. Employee shareholding has been Labour and Liberal Democrat policy for some time, and only the other day a past deputy chairman of the Conservative Party suggested that there should be tax incentives for those who share profits and equity with staff. It is right that there should be agreement on this. Recent research concluded that we all benefit: employees benefit through a better sense of fairness, motivation and well-being, companies from unlocking exceptional levels of discretionary effort, and society benefits too. Research also shows that companies which have 3% or more of their share capital held for the benefit of employees regularly outperform other companies. So it is not difficult to draw the conclusion that employee shareholding and involvement in corporate governance is a characteristic of the successful, well-run business.

This is not new: 40 years ago, I introduced these principles in the business I was building, and I was not the exception. Governments have introduced it—our postman got shares when Royal Mail was privatised. However, the Enterprise Act 2013, designed to encourage employee shareholding, has had hardly any firms adopting its provisions. I think that this is because a sense of ownership is not enough. There also has to be a share of power, some say in policy. All this comes together in what many refer to as stakeholder capitalism, or business with a purpose—a shared sense of purpose not only within the business, but with society, customers, suppliers and all who are affected by the business, large or small.

I am grateful to the Financial Reporting Council for sending me its updated corporate governance code, because it too recommends engagement through directors appointed from the workforce and places particular emphasis on the relationship with a wider range of stakeholders. The Companies Act already calls on companies to behave in this way. There are new regulations that will require companies to report on salary ratios, engagement with employees and better corporate governance.

Fortunately, there are some schemes designed to help this work—to help workers be responsible shareholders and directors, in trying not only to raise productivity, but to make their places of work more purposeful. One of these is Be the Business, chaired by Charlie Mayfield. I declare that I am a member of it. Be the Business provides tutoring and mentoring by experienced executives from many of our successful companies—interventions that are already giving firms a boost, particularly SMEs. Be the Business also creates business improvement networks that enable best practice to be shared between firms that would otherwise not be exposed to more efficient ways of working.

The Government’s industrial strategy—noble Lords might remember that—if it is ever put into practice would target solutions aimed at raising productivity, but employee shareholding and participation in corporate governance hardly feature. Of course, worker directors and shareholders have every incentive to raise productivity because this is the key to higher wages, but the tutoring, mentoring and sharing of best practice could have been a very helpful recommendation made to the Government by the promised industrial strategy council, which has yet to meet.

With increasing knowledge and understanding, maybe worker shareholders will ask more searching questions, such as why boards authorise share buybacks instead of investing to raise productivity. Firms might also welcome shareholders who are not algorithms with trading strategies entirely unrelated to the business and where average holding is now measured in hours and minutes, not months and years.

Tomorrow’s Company—an expert in this field—tells us that, in its experience, the value of employee ownership and involvement very much depends on the degree of their involvement and their influence on the leadership of the company. The Financial Reporting Council currently has no statutory power to sanction companies for failing to comply with its code. So a lot depends on how rigorously these codes and regulations are enforced. The French think that it should be compulsory and in France there are strict laws about profit-sharing and worker representation on boards. It is similar in Germany. It does not seem to have done their economies any harm. In fact, some think that this is one reason why their productivity is well ahead of ours.

Light-touch regulation might be more acceptable to some, but in many cases it does not work. Obviously the extra force of law helps boards to challenge the company executives, hopefully spot trouble early and insist that is dealt with. Many wish that this had happened at Carillion. Labour’s proposals for a compulsory scheme of employee shareholding is on the right lines, but I would like to see it combined with an equally strong enforcement of the new code from the Financial Reporting Council.

These are Labour ideas that go back a long way. They were included in our 2017 election manifesto. In her newspaper article last weekend the Prime Minister suggested that in some things we should join her. In this matter the shoe is on the other foot. Instead of borrowing our ideas, why not join with us and help develop them? My question to the Government is: will they join us and give employee share ownership and participation in corporate governance the force of law? Join us to help rebuild the confidence and trust in business that we all agree is so essential to our future, because, whatever the outcome of the Brexit negotiations, these structural economic problems will still need to be solved. They will not go away.

I thank all noble Lords for participating in this debate. I look forward to hearing what everybody has to say and to the Government’s response.

Elections: Personal Data

Lord Haskel Excerpts

Wednesday 18th April 2018 Lords Chamber

Asked by

[Lord Haskel]

To ask Her Majesty’s Government what steps they are taking to prevent possible abuse of the United Kingdom’s electoral system following the evidence given by Mark Zuckerberg to the United States Senate on 10 April.

[Lord Young of Cookham (Con)]

My Lords, the Government take the security and integrity of our democratic processes very seriously. We have measures in place to protect elections from undue interference, both on and offline. We talk regularly with the major tech companies about a range of safety and security issues; we work closely to support those responsible for overseeing and delivering our elections; and we keep the need for legislation under review.

[Lord Haskel (Lab)]

My Lords, I hear what the Minister says, but are the Government listening to the obvious concern from all over that our political integrity is under threat? If the Government were listening, surely our institutions would already have caught up with the much stronger powers of enforcement and regulation such as those of the Financial Conduct Authority, the regulations in place regarding the press, TV and radio or the powers to break up market dominance that we have in other sectors? Will the Government start catching up now?

[Lord Young of Cookham]

The noble Lord will know that the Data Protection Bill is at the moment in another place, having passed through your Lordships’ House. That Bill gives extra powers to the Information Commissioner to safeguard the integrity of our democratic process, as he indicated. For example, once the legislation is on the statute book, the maximum fine for an organisation such as Facebook would rise to £1 billion. New criminal offences are being created and the Information Commissioner is being given extra powers. As I said a moment ago, there is a dialogue with the Information Commissioner and if at any point she feels that she needs additional powers, over and above those in the current legislation, we are more than ready to consider them.

House of Lords Act 1999 (Amendment) Bill [HL]

Lord Haskel Excerpts

Friday 9th September 2016 Lords Chamber

[Lord Haskel (Lab)]

My Lords, the answer to the question put by the noble Lord, Lord Robathan, about who is to blame is this: Jack Weatherill, and I will explain why. Perhaps I may start by saying that I support my noble friend’s Bill and I congratulate him on it. It is a step in the right direction in terms of reforming your Lordships’ House. It provides for reform by small steps, which is the way I think that most Members and the Government would like to progress. We are committed to achieving most of what the noble Lord, Lord Robathan, has just been talking about.

It is clear that the election of hereditary Peers has become ridiculous. My noble friend gave an example where seven candidates stood and three electors voted for the recent vacancy on the Liberal Democrat Benches. We can overcome most things, but we cannot overcome ridicule, especially as how appointments to this House are made is a major public concern, as the noble Lord, Lord Norton, pointed out.

I served on the Government Front Bench when the 1999 Bill was being debated, so I am pretty ancient. I clearly remember that the election of 90 hereditary Peers was seen as a compromise. It was a temporary arrangement that was negotiated by Jack Weatherill—a former Speaker of the House of Commons—as a way of overcoming the huge number of hereditary Peers who at the time could block or delay any legislation in this House. That was the purpose of the negotiation.

[Viscount Waverley]

I apologise to the noble Lord. Will he take into account the difference between facilitating and negotiating? I think that Lord Weatherill facilitated the process to which he refers.

[Lord Haskel]

The noble Viscount is quite right: he did facilitate the process rather than negotiate it. I thank him for pointing that out.

Some 15 of the 90 hereditary Peers were appointed by virtue of being former or at the time current Deputy Speakers. The purpose and usefulness of the procedure has obviously served us well, but it has now expired. The Deputy Speakers have served their time and an elected House is a long way off. The noble Lord, Lord Cormack, is absolutely right to point out that the two additional hereditary Peers were agreed purely for ceremonial purposes.

I agree with other noble Lords that the Bill being put forward by my noble friend deals fairly with the current hereditaries. Of course many have made an important and distinguished contribution to the House. They are eligible to become life Peers and some have already done so. I do not agree with the noble Lord, Lord Elton. This Bill provides the House, hereditary Peers and the country with the certainty that he is looking for. I also agree with the noble Lord, Lord Norton, that it would be a useful and sensible step along the way to reducing our numbers, but that is a separate matter and is one for a separate Bill. But again, this is something about which many noble Lords are agreed. Most of us are committed to step-by-step reform, of which the Steel Bill was one example. This is another one, and I think that the Government should support it.

Civil Society and Lobbying

Lord Haskel Excerpts

Thursday 8th September 2016 Lords Chamber

[Lord Haskel (Lab)]

My Lords, as I understand it, the Government have put on hold the rules regarding the lobbying activities of organisations that receive taxpayers’ money. They are right to do so because their thinking is very confused.

It is not anti-government to seek the best welfare for our fellow citizens. It is not anti-government to seek the highest standards of health and safety. It is not anti-government to seek the highest standards of truth and accuracy in reporting the news. It is not anti-government to have a say in genetic manipulation. I say to the noble Lord, Lord Patten, who is not in his place, that it is not anti-government to seek higher standards of conservation. These are some of the voices to which my noble friend Lady Hayter referred—the real-world experiences, as the noble and right reverend Lord, Lord Harries, put it—voices which tell us where government policy is failing and where our priorities should lie. These voices want a say in shaping society, not by revolution or violence but by balance—the kind of balance about which my noble friend Lady Jowell spoke. These voices need to be heard. They are not voices that the Government should seek to silence because they are funded by the taxpayer. It will not have escaped the Minister’s notice that the very reason these organisations are sometimes funded by the Government is that both seek the same ends. But democracy and the welfare of society are the not the only reasons why the Government should listen to trade unions, charities and civil society. These organisations are also the voices of progress—social, scientific, medical and commercial—based on experience, as my noble friend Lord Griffiths put it.

We are debating the Investigatory Powers Bill at the moment. Technology has given us new ways of communicating—ways that make our lives easier, our communications quicker, more social and more fun. But these ways are also available to criminals and terrorists. This Bill will clarify to what extent our communications can be intercepted and recorded by the authorities. Previously, powers of interference and access to records were created as and when the need arose. However, in debate on that Bill, we hear quite clearly the voices of civil society, reaching a balance between the commercial interests of the communications business, the concerns of our national security and our right to privacy. Without the voices of civil society, charities and trade unions, I doubt whether a satisfactory balance would be achieved on the Bill.

More technology is on the way which will require this kind of balance. Let us take, for instance, the changing world of work. Several million people are now working off digital platforms. It suits the operators to say that these people are self-employed so that the minimum wage, holiday pay, sick pay, maternity pay, training, safety, pensions and tax are nothing to do with them. It is left to the state to pick up these costs through welfare payments and tax credits. I am sure lobbyists for platform operators and internet service providers put a very good case to the Government for their own commercial objectives. But what about fairness and costs to the public? Trade unions, civil society and charities—yes, sometimes even funded by the Government—are the ones speaking up for these things, and fairly soon some sort of balance will have to be agreed. Digital platforms themselves could be required to ensure that users comply with current regulations, and workers could belong to some kind of trade union co-operative. Then neither workers nor users would be vulnerable to exploitation.

In many other areas of new technology, charities are in the front line to achieve balance. We hope that some of our more serious medical problems will be eliminated by genome editing. For some, altering our chromosomes and genes can be a terrifying prospect. It is contrary to the faith of others. Yet it holds out the prospect of quick and relatively cheap medical miracles. Unless charities and civil society set about explaining these issues through some sort of public understanding campaign, to encourage sympathetic public opinion, the benefits of this wonderful medical research will take a long time to be accepted, if ever. I hope the Government are lobbying the charities and giving them donations to help with this work, for the sake of the nation’s health.

Lots more things are coming down the line where a balance will have to be achieved between commercial interests, security and the public good: the internet of things and digital money, to name but two. My noble friend Lady Hayter is absolutely right to move this debate and I congratulate her. Uncertainty on how to respond to the changes brought about by new technologies will lead to inaction and lost opportunity unless the input from society brings about acceptance and understanding, through balance and fairness.

For the sake of progress and the public good, the Government should listen to all these voices equally and not give disproportionate influence to company voices, nor quieten the voices of tax-supported charities. We need them all equally to better inform our decisions.

Queen’s Speech

Lord Haskel Excerpts

Tuesday 24th May 2016 Lords Chamber

[Lord Haskel (Lab)]

My Lords, like the noble Lord, Lord Lisvane, I, too, want to deal with the quality of legislation presented to us. In recent years I have served on your Lordships’ Delegated Powers Committee, and I currently serve on the Secondary Legislation Scrutiny Committee. During this time, I have become more and more concerned about the poor state of legislation presented to us by the Government, and it is getting worse. The Executive have to do something about it.

Of course, what brought this to a head was the statutory instrument regarding tax credits. This precipitated the Strathclyde report, to which many noble Lords have referred. But this was not the only example of poor preparation, or of using secondary legislation to introduce new and significant matters. The Secondary Legislation Scrutiny Committee has recently drawn attention to matters across the whole spectrum of government—social housing, hunting, building regulations, feed-in tariffs. Last week, we drew your Lordships’ attention to the use of secondary legislation to bring about a large West Midlands combined authority with a directly elected mayor—surely a major change in local government—for which there was three weeks’ consultation, and that was via the internet. The previous month we drew to your Lordships’ attention the withdrawal of statutory regulations by Defra regarding the welfare of certain farmed animals, replacing them with a voluntary code on the grounds that this would achieve higher standards. But the responses to the consultations indicated the opposite. The order was cancelled.

Do the Government consider that to be a defeat, or is it the House doing its job? By drawing attention to these weaknesses and errors in legislation, the House has assisted the Government in avoiding some very nasty and awkward unintended consequences. The result of this poor preparation is that the passage of legislation has become uncertain—even, in some cases, chaotic. It lacks authority when it lacks detail. Indeed, while the Welfare Reform and Work Bill was still before us, the Government used secondary legislation to implement a major change—while the Bill was still in progress.

I put it to the Minister that the Government are losing votes not only because there is disagreement over policy but because the legislation is not thought through. It is poorly prepared and incomplete. That is why we have recently seen government U-turns or policies changed or abandoned. What worries me is that as standards decline, opportunities grow to avoid, evade, ignore, or even break the rules—rules that are devised for the public good. Poorly prepared legislation forced through will undermine our culture of strong and fair-minded government.

So, what is to be done? Is the problem a lack of staff with the expertise, analytical skills and experience in preparing legislation? Have departmental cuts gone beyond trimming the fat and unnecessary bureaucracy, so that the bone is damaged? We all know that when cuts are made, the cost reductions soon look good in the budget but the deterioration in service, quality and standards follow later. Is that what is happening? As the noble Lord, Lord Lisvane, implied, Ministers have a responsibility, too. As he said, they need to make speeches, present Green Papers and White Papers, do the pre-legislative scrutiny, present draft Bills and proposed schedules of secondary legislation. Is that work being done? It would appear not.

Then there are all the departmental checks. Are these being done, and is LegCo—the Cabinet Committee—doing its work? Here is what I hope is a helpful suggestion—artificial intelligence. The Minister may have read about it in the Huffington Post today. The Government’s Science and Technology Facilities Council at Hartree has a five-year contract with Watson—that wonderful equipment at IBM. After all, machines now read and analyse clauses in loan agreements and contracts of sale. Could legal technologists help to prepare better legislation? They could ensure that draft legislation contains all the Government’s own principles and standards on consultation and on impact assessments, and that everything is included in the Explanatory Memoranda, and even point to possible Henry VIII clauses.

It would be wrong to introduce legislation curbing the powers of your Lordships while leaving everything else as it is. It would be just like getting rid of an irritation. Without dealing with the cause, the irritation will come back.

Charities (Protection and Social Investment) Bill [HL]

Lord Haskel Excerpts

Monday 6th July 2015 Grand Committee

Relevant documents: 1st Report from the Delegated Powers Committee, 2nd Report from the Constitution Committee.

[The Deputy Chairman of Committees (Lord Haskel) (Lab)]

My Lords, if there is a Division in the Chamber while we are sitting, this Committee will adjourn as soon as the Division Bells are rung and resume after 10 minutes.

Clause 13: Power to make social investments

Amendment 20B

Moved by

Charities (Protection and Social Investment) Bill [HL]

Lord Haskel Excerpts

Wednesday 1st July 2015 Grand Committee

[Viscount Younger of Leckie (Con)]

My Lords, I think this may be a convenient moment for the Committee to adjourn. The Committee is due to return to reconsider this Bill on Monday 6 July.

[The Deputy Chairman of Committees (Lord Haskel) (Lab)]

My Lords, the Committee stands adjourned.

Committee adjourned at 7.28 pm.

House of Lords (Expulsion and Suspension) Bill [HL]

Lord Haskel Excerpts

Friday 24th October 2014 Lords Chamber

[Lord Haskel (Lab)]

My Lords, I, too, support the Bill. As others have said, in the two debates earlier this year—that on the report of the Labour Peers working group, referred to my by noble friend Lady Taylor, and that on the Steel Bill—many people referred to the fact that House of Lords reform would do better to proceed in small steps. The two Bills which tried to deal with the whole of House of Lords reform were both withdrawn because of the absence of consensus.

There are many things on which we can agree, and by taking them one at a time we may be able to achieve reform by accretional amelioration, as only the noble Lord, Lord Phillips, could put it. This Bill is one such step. As the noble Baroness explained, the Bill deals with the expulsion or suspension of Members of this House who have knowingly broken our rules or fallen below the standards that we have set ourselves.

I think that all of us would agree that a strong state demands high standards in public life. Without it, the capacity of Parliament to govern, and our reputation, diminish. Part of upholding those standards is the ability in any circumstances, irrespective of the parliamentary calendar, for this House to remove or suspend Members who have fallen below these standards. I feel that it is more applicable to us than most, because we are an unelected House and privileged, as the noble Lord, Lord Phillips, put it. It would be best if the Bill became law, because if it does not, we will be accused in the press and in the blogosphere of simply looking after our own—and there might be an element of truth in that. Some say that this is really a housekeeping matter. I do not agree. It is serious enough to be put on the statute book.

I finish by thanking the noble Baroness for the Bill. It takes a lot of work to put a Private Member’s Bill through this House; it is time consuming and often frustrating. The workload is also carried by the support staff—my thanks to them. I urge your Lordships to give the Bill a Second Reading.

Universal Declaration of Human Rights

Lord Haskel Excerpts

Thursday 24th July 2014 Lords Chamber

[Lord Haskel (Lab)]

My Lords, I have always had a particular interest in Article 18, because it was persecution that brought me to this country as a child. I hope that noble Lords will not mind if I speak about Article 18 closer to home, like the noble Lord, Lord Parekh. I thank the noble Lord, Lord Alton, for introducing this debate.

The Jewish community has a strong connection with the Convention on Human Rights. The first draft was prepared by Eleanor Roosevelt. Its second draft and the underlying structure were prepared by René Cassin, a French jurist and the son of a Jewish family. What I did not know—and I am indebted to a briefing from Rabbi Lea Muehlstein—was that in 1945 he founded the Consultative Council of Jewish Organizations, which was dedicated to providing encouragement from a Jewish perspective to a nascent UN human rights system. There is an organisation named in his honour, which continues his work today, promoting and protecting universal rights, drawing on Jewish experience and values. So, from the start, the Universal Declaration of Human Rights was embraced by Jewish people.

As the noble Lord, Lord Alton, and others have recounted, some religious groups preach fundamentalism. Some religious teachers think that Article 18 permits religious law to take precedence over civil law. Jews faced this dilemma as far back as the 14th century. Then rabbis decided that the law of the land is the law. They dictated that religious practices must not be in contravention of the law of the state. Article 18 brings this up to date, allowing spiritual and religious self-fulfilment for all faiths. However, there are fundamentalists today in all religions who do not accept this. That is why, to counter this, here and elsewhere in Europe government and local authorities have to make sure that no group is excluded. No one should be left out of housing policy, employment policy, education policy, welfare, skills training and all the other parts of a civilised society.

There is another way that this Government can help Article 18 to flourish in Europe: they can stop confusing the European Court of Human Rights and the European Union in order to placate Eurosceptics. All members of the European Union are bound by the Charter of Fundamental Rights, but that itself is based on the European Convention on Human Rights, which belongs to the Council of Europe. Withdrawing from the European Union has nothing to do with deporting radical preachers or giving prisoners the vote. Will the Minister tell us whether, to satisfy Eurosceptics, the Prime Minister is considering withdrawing from the European convention, or passing a law limiting its powers in the United Kingdom? Or are we going to have our own Bill of Rights, which I believe is being concocted by a group of Conservative lawyers? For all of us in Europe who value the freedoms we have under Article 18, any of these alternatives would be a disaster. Not only would they undermine our position under the Universal Declaration of Human Rights, but picking and choosing which bits of human rights law we like and which we do not would inevitably lead to the suggestion that the way to deal with fundamentalism and radical fundamental preachers is to withdraw from Article 18.

Last week, the Institute for Jewish Policy Research, a secular think tank of which I have the honour to be the honorary president, published its research on the perceptions and experiences of anti-Semitism among Jews in this country. The report stressed that in general most Jews in Britain feel comfortable in the UK with their Jewishness and with their Britishness in spite of a perceived rise in anti-Semitism. Although they may not know it, this feeling of comfort is due in large part to the benefits granted by the state, as laid out in Article 18. Let us keep it that way for the benefit of all faiths.

House of Lords: Labour Peers’ Working Group Report

Lord Haskel Excerpts

Thursday 19th June 2014 Lords Chamber

[Lord Haskel (Lab)]

My Lords, I begin by joining all noble Lords in saying what they are thinking: “Finally, the last speaker”.

[Lord Winston (Lab)]

Not quite.

[Lord Haskel]

Secondly, I add my thanks to my noble friends who wrote this report. As they say, the House needs reform.

The noble Viscount, Lord Tenby, reminded us that reform of this House has been debated for more than 100 years. Until 1949 the debate was about the powers of the House. From 1950 onwards the debate was about membership, and in 1999 this was settled to some extent. The reform debate should again turn to powers. Surely the question is: what are we for? Are we here to make the law or to check it over, to revise it? Are we here to hold the Government and perhaps the House of Commons to account? What is our relationship with the House of Commons and does it need to change, as other noble Lords have suggested? This decision is central to whether we have an elected House of Lords or not. As the paper points out, it is important to carry out these reforms while maintaining the primacy of the House of Commons.

Perhaps I may say to my noble friend Lord Richard that those of us who have been visitors to the United States over the past 20 years will have witnessed Congress, with two elected Houses, slowly disintegrating into pointless partisanship. It is where political debate has been marginalised in favour of last-minute deals—even on important matters such as the budget. That is no way to run a country and I join my noble friend Lord Howarth in thinking that there is a warning for us there.

[Lord Richard]

My Lords, my noble friend was kind enough to refer to me. Perhaps he would answer a question from me? He has observed the United States, as I have done. Does he really think that it would have been better governed in the past 20 years if the Senate had been nominated by political parties?

[Lord Haskel]

The answer is: that is beside the point.

We have been struggling with reform since the hereditary Peers left. We have had a royal commission, four White Papers, two Bills at attempted reform of the House and reports from several Select Committees, academics and think tanks. One must also not forget the very sensible proposals made by the Clerk of the Parliaments in December 2012. Little progress has been made because there has been very little consensus. That is why the working group’s paper is valuable. It makes sensible proposals for full reforms, around which it is possible to build consensus. My noble friend Lady Taylor told us how, the more the committee debated, the more consensus emerged. I agree with the proposed constitutional committee to look at the wider constitutional picture and say where we are, as the noble Lord, Lord Norton, put it. I also agree with most of the recommendations regarding composition, size, membership, appointment, political balance, and rules for attendance, retirement and procedure. These are all sensible suggestions, but the question is the practical one: how do we put them into effect?

In view of the lack of consensus, I see absolutely nothing wrong with slow and careful incremental reform, taking one thing at a time. One follows logically from the other: each reform will lead to a further reform—the “inevitability of gradualism”, as Fabians would say. The Steel Act is one such step. We need further steps. For instance, the Government could announce, without legislation, a numbers cap and a timetable for reduction of Members. We cannot go on just growing like this. Reduction could then be achieved perhaps by using the same procedure as when the hereditaries left: each group deciding on who would stay and who would go. That would lead to a formula for sharing new appointments between the parties and the Cross-Benchers. The formula would be managed by a strengthened Lords Appointments Commission and in this way the political balance of the House would be maintained.

All this touches on the funding of political parties. A reform of House of Lords membership may even help precipitate a reform of funding. Procedural reforms lie in our own hands and there are very sensible recommendations before us to consider.

This step-by-step reform has to be brought together in a narrative that explains what we are trying to do and why this has become important. It has to be part of our outreach. My noble friends Lady McIntosh and Lady Bakewell both referred to the importance of this, and they are right. In fact, we are quite progressive on outreach in this House: we were the first House to let TV in; we have a Chamber event for non-Members each year; and Parliament Week leads to public engagement and events where people learn about Parliament. We have an excellent website and we are active in all the social media.

As unelected legislators, I have always felt it is part of our duty to explain who we are and what we do, through not only the excellent work of the Information Office staff through their website and social media, but personal contact. People like to meet Peers. Some of us speak at regional meetings of organisations, such as the WI or Rotary. Peers in Schools is flourishing—my noble friend Lady Bakewell spoke of this and she is right. The 150 of us who do visits get the impression that there is little appetite for increasing the number of elected politicians in Westminster after we explain what we do. Indeed, I find that people welcome this House giving Government the opportunity to bring people into government from outside Parliament. However, we have to be a lot more effective in holding the Prime Minister to account for his choice, be it good or bad.

If we are effective in harnessing all this work to explain the narrative of our reform and how we are doing it step by step, it will help lead to consensus in the House and a better informed and more supportive public outside the House. Most importantly, we have to persuade our political leaders to get away from the adrenalin of big reform Bills and be satisfied with a narrative of small reform Bills, which in the end will achieve the same objective.