The UK’s House of Lords has quietly doubled its threshold for reporting shareholdings to £100,000, which campaigners say makes it easier for members to evade scrutiny of their financial interests.
Under the updated House of Lords Code of Conduct – approved by peers on 14 September – members must now report any shareholding amounting to a controlling interest or more than £100,000 in value.
This is the first time the reporting threshold for members of the House of Lords has been updated since 2010, when the threshold was set at £50,000 (MPs have to report holdings worth more than £70,000 or more than 15 per cent of a company’s share capital).
Of 818 currently sitting peers, 401 have declared shareholdings in the register of members’ interests. “The public has a right to know significant shareholdings held by lawmakers, which may present a direct conflict between their roles as public servants and their private financial interests,” said Steve Goodrich of Transparency International. “By voting to double the reporting threshold it is now possible for peers to hold shares worth more than most households’ annual income without the public being any the wiser.”
Despite pressure for greater transparency from both houses of parliament, the threshold “was not subject to a general consultation,” said Christopher Johnson, the upper chamber’s Clerk of Journals. Asked why it was set at £100,000, he said initially he thought it was a “round figure”, adding later it was raised because of the “passage of time, inflation and the rise in share prices since 2010”.
Scottish parliament members and members of the Welsh Senedd have to register shareholdings worth more than 50 per cent of their annual salaries – about £34,000.
Members of the US Congress have to declare any stocks over $1,000 within 45 days.
“Given the importance of this information, it is all the more shocking that the members of the House of Lords have decided to make it easier to evade scrutiny over their financial interests,” Goodrich said.
In 2014, when a change to the shareholding threshold for MPs from parliamentary salary to £70,000 was reviewed by Greco – the Group of States against Corruption of which the UK has been a member since 1999 – it recommended “that consideration be given to lowering the thresholds for reporting financial holdings (such as stocks and shares)”.
Despite this the minutes of a Lords’ Conduct Committee meeting for 14 June state that “some members felt that the different context of the two Houses meant that the Lords’ threshold did not need to be as low as the Commons”.
The Commons’ standards committee response to Greco’s recommendations was that “leaving aside questions of privacy, we believe too low a threshold could obscure significant matters in a blizzard of trivial details”.
A spokesperson for the Council of Europe said that Greco wasn’t in a position to assess this specific issue but that “doubling the threshold would, on the face of it, not appear to be going in the right direction” in light of the group’s previous findings.
It’s unclear how many peers will no longer have to report their shareholdings because they are not required to disclose their value, but an investigation by the Guardian earlier this year found that more than 50 MPs have owned stakes in publicly listed companies which did not need to be publicly disclosed in parliamentary registers.