NECessary duties

How do you manage a political party without the politics getting in the way?

Show your appreciation!

This is the fortnightly free edition of my newsletter. This is also the last day on which the ‘early bird’ discount for an annual paid membership - essentially doubling your content - is available.

---

[Edited to add details about Labour’s NEC Business Board which is the body within the NEC that scrutinises the accounts in full. My thanks to some very helpful feedback from a correspondent. I don’t think this changes my argument here but it does add more context].

It would take a heart of stone not to find near-constant amusement in the current travails of the SNP. And while my heart is definitely granite flecked, I have still, somehow, managed to find much amusement in the seemingly never-ending and ever more ridiculous twists and turns.

Questions such as “They bought a what now?” “ Where did all the money go?”or “So wait, how long has it been since their accounts were audited?” Or even “What does it take for an accounting firm to walk away from being paid for something?” abound.

There is also the fact that is is seemingly impossible at present for a senior SNP figure (with the exception of the suddenly invisible Nicola Sturgeon) to see a camera and not walk straight up to it, explain how they won’t be commenting on the ongoing police and internal inquiries and promptly comment on said inquiries - and often in wildly ridiculous ways.

The chaos engulfing the SNP is objectively funny and, for many of my friends in Scottish Labour, also deeply cathartic.

But there are wider lessons to be drawn from this for Labour and other political parties too. So I am going to (try to) stop giggling for a moment and think about what lessons we should be looking at from the SNP immolation beyond it simply adding to the gaiety of the nation(s).

Firstly, it has become abundantly clear that the interests of the individual politician Nicola Sturgeon became repackaged as the interests of both the party they led and the wider independence movement. Thus, any and all criticism of the former - whether about tactics, strategy or political issues outside of that movement - came to be seen only through a lens of being for/against Nicola and therefore for/against the SNP and independence.

Don’t think the SNP have done a good job on health inequalities or education? Shut up or you’ll damage the independence movement.

Raising (what turned out to be extremely valid) concerns about how the SNPs finances are being managed? You will be chastised by the leader and warned that any public discussion is tantamount to making it impossible to run the finances well - that it’s all your fault for asking questions that they have to hide the answers from you. I am far from convinced that fostered an atmosphere where any attempt to avert the current crisis could really meaningfully exist, never mind flourish.

Any member of the Labour Party - if they are being honest with themselves - will recognise some of this. The tribalism that naturally comes along with politics also means a protectionism of our own that, at best, tunes out and at worst turns against any criticism of a leader however valid.

Fundamentally, this is not a left/right divide in Labour. Those who criticised Corbyn supporters for being blind to his faults get angry with those who criticise Starmer and vice versa. It’s a natural human instinct, that is heightened by the emotional needs that politics can provide people.

The structures of politics itself make this so much harder. When people are largely volunteering their time and labour, without an expectation of favour or reward (which is true for the vast majority of members of all parties) there is an obvious need to defend your own reasons for doing so which can easily become defensiveness and a blind faith that means that the right questions aren’t being asked.

One of the areas that I find most shocking about the SNP story is the behaviour of their governing board - their National Executive Committee (NEC). Reportedly, this body did not see - or at least sign off - the accounts for somewhere between 18 months and two years. That is a fundamental and should be an existential failing of what this board is for.

The SNP’s NEC has now set up an internal review to assess what has gone wrong. But this feels to me like a deeply inadequate response. An internal review can only bring all the same blindness to the question as has come before.

Were I to be a company looking to take on responsibility for the auditing of the SNP, I would make an external review into their practices, internal culture and governance policy a prerequisite with a commitment to act on its findings and implement all recommendations within a limited and agreed time period.

Again, I think there are many lessons that can and should be learned when talking about Labour’s governance.

I am told that one of the key differences between Labour NEC members is that Labour NEC members are personally liable if the party goes bankrupt - SNP’s exec are not. I know the former to be the case, but I am unable to confirm the latter (if you have information on this please put it in the comments!).

That will concentrate the minds of NEC members who may well not be able to bear the financial burden of taking on the debts of a profligate party. This, I believe, has probable set Labour up for a better chance at ensuring proper financial scrutiny at least.

[added text] The NEC has what is called a Business Board¹ and an Audit Sub-Committee²- the terms of reference of which are in the foot notes. These act as the scrutiny bodies when it comes to financial accounts and HR matters. This is currently made up of the NEC officers and Andy Kerr of the CWU.

The NEC officers will also decide what comes to a full NEC so sometimes, when larger issues occur they will be brought to the full NEC. The example my correspondent gave was the cuts to the party’s budget and spending in 2021. But largely it is this focused body that has responsibility for oversight in these areas. [end of added text]

However, other kinds of scrutiny may well be lacking from the way in which our NEC is consituted and appointed.

I say this not because I don’t have a great deal of time and respect for the job done by the NEC. I count several of its members as personal friends and these sit across factional divides. I know people there as affiliate representatives (each of whom is technically elected at conference, but that is largely a formality as the affiliates tend to bash out among their own executives who they will put forward and use their block vote to ensure it) and as constituency representatives (who are directly elected every two years - a term I have long called for to be extended - which I did when the left was in ascendancy and now the right is in charge I have not changed this belief).

My problem comes because in the elected portion in particular, there is little understanding when seeking these positions as to what it is they are actually for.

For example, candidates most likely to win one of the nine constituency roles on the NEC will sign up to a ‘slate’ (Momentum and other smaller groups on the left, Labour to Win on the right). Many others try to go it alone but without the resources and intel the slates hold it’s a very hard slog.

Each candidate then releases a statement that will either emphasise their history and experience of campaigning in and for the Party or their policy passions. Some members might even read some of these statements. Many will go either with their chosen slate or their personal experience of the candidates.

But what is largely lost in this process is any sense of how the candidate might approach oversight. Look at the story about the Labour to Win slate, for example. It talks of candidates committed to ‘working with Keir Starmer, Angela Rayner and David Evans [the General Secretary of the Party].”

I can see why this is. And I can see why five years ago, you would have an identikit promise to work with Jeremy Corbyn and Jennie Formby (though I suspect then Deputy Leader Tom Watson would have been left out of this formulation). It’s a signal of what side you’re on in Labour’s forever wars and that will gee up the internal electorate to best advantage. No one probably ever won an internal election by saying “I am a forensic accountant and wish to utilise these skills to properly interrogate the finances of the party”. Get that on a T Shirt…

But actually, that is what is needed - at least in part - from a governing body. And the more we continue to make these elections about internal political wrangling the less we make the role of the NEC about non-political oversight.

So I come, again, to my argument that Labour should have far fewer internal elections far more spaced out.

My contention has always been that endless internal elections focus us inwards rather than outwards and I stand by this. The Labour Party is always too willing to turn our fight in on ourselves and having these elections last for long drawn out months every two years means there is far too much energy being spent on the party talking to itself about itself.

But, in a seeming contradiction, if we were to take the endless need to campaign out of being an elected NEC members, then at least that portion of the NEC could have more confidence in its ability to spend time and energy on scrutiny of the party. This small group of people who have been elected specifically to focus their energy inwards on the party would have the freedom to do so properly without the constraint of having to feel electable and therefore demonstrate loyalty to a faction over their role in scrutinising the behaviours of the Party whoever is leading it.

Political parties are made up of people who are statistically a bit weird. We are part of the less than two percent who have chosen to go as far as to actually start to pay dues to a political party. Given that turnout rates in internal elections are historically pretty low, those who vote are - again statistically and without judgement - the weirdest of the weird.

We (and I am someone who has voted in every NEC election for the last 35 years and got a little cross when it looked like I was going to be prevented from doing so) are unlikely to vote on things as boring as a history of oversight or a background in finance, HR or organisational development.

So the question we should ask ourselves as we look on and laugh at the SNP is how we make sure that we not just have the kind of oversight in place that they are clearly lacking, but that the structures that bring about that oversight are sound and not easily captured by those who would wish to avoid scrutiny - wherever they sit on the political spectrum?

Buy me a coffee

---

I run a political and communications consultancy called Political Human. Please get in touch if you are looking for political or media consultancy advice, strategic communication and campaign planning, ghostwriting, copywriting, editing, training or coaching.

You can read some lovely things that some of my clients have said here.

---

What I’ve been up to

As always I was on GB News several times. Here’s a clip where I discuss radical feminism and pre-payment meters (not in the same response!).

House of Comments returned after the Easter recess. Here we discuss Dominic Raab’s charmless and graceless resignation. And a week later we ran fascinating interviews with Dave Rich of the Community Security Trust and Chris McDonagh of Travellers Against Racism and Sami McLaren of the Friends and Families of Gypsies and Travellers to talk about the issues raised in Diane Abbott’s now infamous (and retracted) Observer letter.

There is also a new edition of The Zeitgeist Tapes, looking at the politics of My Fair Lady - a film I will freely admit I found utterly baffling. How is this a classic? How?

I have also reviewed some very different theatre this fortnight.

Blackout Songs is a frenetic and downbeat drama about two people who meet at AA.

Immersive Dorian Gray is just that!

Dixon and Daughters is a frenetic play about the women left recovering in various ways from familial abuse.

And Supernova is an extremely well-written portrait of depression and the impact it has on a relationship. But also a Rorschach test for audiences - one I think I might be on the more uncomfortable side of.

1.   Business Board Protocol (terms of reference) Terms of reference and membership The NEC Officers Group will constitute the Business Board which will be chaired by the Elected Treasurer. When meeting as the Business Board, this group will be comprised of one additional NEC representative who has formerly served as NEC Chair. No member of the Audit, Risk and Compliance Committee can be a member of the Business Board. The Business Board may from time to time invite an appropriate specialist input to assist it in its role. The General Secretary shall provide progress reports to the Business Board on the strategies adopted by the NEC to meet its organisational and financial objectives, including the fundraising strategy. The Secretary to the Business Board will be the Director of Finance, who will be responsible for drawing up the agenda in line with these reports and in consultation with the General Secretary and Elected Treasurer. The agenda and papers will be circulated seven days in advance whenever possible and not less than five days. The Elected Treasurer/Business Board Chair will have the authority to agree to the tabling of late papers. The Business Board has delegated authority to take decisions on behalf of the NEC. Due to the sensitivity of the issues discussed, and to ensure open and fully informed discussion, the minutes and papers of the Business Board are not circulated to the NEC. At least twice a year the Business Board will present a report to the NEC on its activities. All discussion and papers presented to the Board are confidential and may not be disclosed outside of the Business Board membership. The Business Board will have oversight of:  The annual budget  Management accounts (at least quarterly)  Property  Personnel  The Superannuation Scheme  Current legal issues that are not the responsibility of the Organisation Committee  Membership  Bank overdraft The Business Board will be responsible for:  The acquisition, disposal or change of use of land and/or buildings  To agree action on litigation against or on behalf of the NEC, other than what is in the remit of the Organisation Committee  Agreeing the permissibility of donors in accordance with the PPERA NEC Terms of Reference Agreed by the NEC 295/11/202221 15 In between meetings of the Business Board, the Registered Treasurer will consult regularly with the Elected Treasurer, on matters which require them to make use of their delegated power to discharge the functions of the committee. The Elected Treasurer will receive monthly monitoring of management accounts and cash flow forecasts and shall be consulted on expenditure over £100,000. Nothing in these terms of reference supersedes the authority and legal position of the Registered Treasurer under the Political Parties, Elections and Referendums Act 2000. The Business Board will meet annually with the Audit, Risk and Compliance Committee, as required.  

 

2. Audit, Risk and Compliance Committee Sub-committee protocol (terms of reference) The Audit, Risk and Compliance Committee is a sub-committee of the NEC, appointed by the NEC and comprising NEC members. As well as having responsibility for existing audit and compliance oversight, it is accountable for internal audit procedures providing a systematic approach to risk management in all of the Party’s activities. It shall consist of:  Seven NEC members  Two lay Auditors elected from Annual Conference  A co-opted member with accountancy and risk management experience background. Neither the General Secretary nor the Executive Director – Finance and Operations shall be members, although they will attend at the invitation of the Committee. The NEC Chair, elected Treasurer and members of the Business Board are not eligible to be members of this Committee. It shall be serviced by a senior member of the Governance and Legal Unit (or other member of staff designated by the General Secretary), who will be responsible for drawing up the agenda in consultation with the Committee Chair. The professional and elected auditors will be invited to the Audit, Risk and Compliance Committee meetings. They will have the opportunity to meet the Audit, Risk and Compliance Committee in the absence of party staff, during the year. The quorum of the Audit, Risk and Compliance Committee shall be a third of its voting members, rounded up to the nearest number. Where the Committee Chair is not in attendance, a quorate meeting may elect one of its voting members to act as Chair pro tem. The Audit, Risk and Compliance Committee should meet no less than three times a year, with meetings time-tabled well in advance. The agenda and supporting papers will be sent out seven days in advance whenever possible and not less than five days.. The Committee Chair can agree to the tabling of late items. The minutes of each meeting will be approved by the Chair of the meeting and submitted to the subsequent meeting of the NEC. The main objectives of the Audit, Risk and Compliance Committee are to ensure that the Labour Party’s financial activities are within the law, and that an effective system of internal control is maintained. All discussion and papers presented to the Committee are confidential and may not be disclosed outside of the Committee membership without the express consent of the Chair of the Committee. The Committee is responsible for: NEC Terms of Reference Agreed by the NEC 295/11/202221 13  The appointment of the professional auditor and monitoring and reviewing the external auditor’s independence, objectivity and effectiveness  Discussion with the professional auditor, before the audit commences, of the nature and scope of the audit  Reviewing the Auditors’ report and the annual financial statements before submission to the NEC  Reviewing annually the Standing Financial Instructions  Reviewing the party’s internal control systems and risk management systems  Where its monitoring and review activities reveal cause for concern or scope for improvement, to make recommendations to the Business Board and/or NEC on the actions needed to address the issue or make improvements The Committee will, inter alia, review the adequacy of:  The party’s financial risk register and risk mitigation plans, and the responsibilities for identifying and managing key risks  The policies for ensuring that there is compliance with relevant regulatory, legal and similar requirements  Rules for tendering and the awarding of contracts The Audit, Risk and Compliance Committee will meet annually with the Business Board as required.