Campaigners have criticised a change to the rules around declarations of interest in the House of Lords as a “retrograde step” which will lead to a “significant loss of transparency”. 

Since 2000, peers have had to register a list of “non-financial interests” – which includes declaring unpaid but often important roles like being a director, trustee, or chair of a company, think tank or charity.

But that requirement was dropped in April despite staff concerns.

Tom Brake, director of Unlock Democracy, and a former Liberal Democrat MP, wants to see the decision reversed.

“It’s a retrograde step,” he said. “I think we’ve got a significant loss of transparency and accountability and that is bad news for the public.

“More than 25 years ago, the Committee on Standards in Public Life identified that there was a need for peers to register non-financial interests because that could influence their decisions. I’m confused as to what’s happened in the last 25 years that now means this requirement can be scrapped.

“This process seems to be all about making matters simpler for peers, rather than what the code of conduct is supposed to do, which is to boost the public’s confidence.”

Westminster Accounts: Search for your MP

Rules were too ‘burdensome’, say peers

The change was part of an overhaul of the code of conduct which aimed to “shorten and clarify” the rules for peers.

The House of Lords Conduct Committee argued that updating non-financial interests was “disproportionately burdensome” with “minor and inadvertent errors” causing “large numbers of complaints”.

As a result, the register of Lords interests shrunk in size from 432 pages to 275.

MPs have a different code of conduct, which requires them to declare any formal unpaid positions or other non-financial interests which may be an influence.

A source told Sky News there is real concern among some Lords’ staff about the implications of the change.

Non-financial interest declarations have previously highlighted cases where a peer’s involvement in a think tank or lobbying group overlapped with a paid role.

Cricket legend among peers to breach code

There are also examples where a peer’s non-financial interest declaration has prompted an investigation – revealing a financial interest which should have been declared instead.

In 2023, Lord Skidelsky was found to have breached the code after registering his role as chair of a charity’s trustees as a non-financial interest.

The Commissioner for Standards investigated after questions were raised about the charity, the Centre for Global Studies.

He concluded that the charity – which was funded by two Russian businessmen – only existed to support Lord Skidelsky’s work, and had paid his staff’s salaries for over 12 years.

In 2021, Lord Botham – the England cricket legend – was found to have breached the code after registering a non-financial interest as an unpaid company director.

The company’s accounts subsequently revealed he and his wife had benefitted from a director’s loan of nearly £200,000. It was considered a minor breach and he apologised.

‘Follow the money’

Lord Eric Pickles, the former chair of the anti-corruption watchdog, the Advisory Committee on Business Appointments, believes focusing on financial interests makes the register more transparent.

“My view is always to follow the money. Everything else on a register is camouflage,” he said.

“Restricting the register to financial reward will give peers little wriggle room. I know this is counterintuitive, but the less there is on the register, the more scrutiny there will be on the crucial things.”

‘I was shocked’

The SNP want the House of Lords to be scrapped, and has no peers of its own. Deputy Westminster leader Pete Wishart MP is deeply concerned by the changes.

“I was actually quite horrified and quite shocked,” he said.

“This is an institution that’s got no democratic accountability, it’s a job for life. If anything, members of the House of Lords should be regulated and judged by a higher standard than us in the House of Commons – and what’s happened is exactly the opposite.”

Public confidence in the Lords is already at a low ebb after the PPE controversy surrounding Baroness Michelle Mone, who took a leave of absence in 2022.

The government has pledged to reform the House of Lords and is currently trying to push through a bill abolishing the 92 remaining hereditary peers, which will return to the House of Commons in September.

But just before recess the bill was amended in the Lords so that they can remain as members until retirement or death. It’s a change which is unlikely to be supported by MPs.

Read more from Sky News:
Warning over water shortfall
Trump gaffe speaks volumes

A spokesperson for the House of Lords said: “Maintaining public confidence in the House of Lords is a key objective of the code of conduct. To ensure that, the code includes rigorous rules requiring the registration and declaration of all relevant financial interests held by members of the House of Lords.

“Public confidence relies, above all, on transparency over the financial interests that may influence members’ conduct. This change helps ensure the rules regarding registration of interests are understandable, enforceable and focused on the key areas of public concern.

“Members may still declare non-financial interests in debate, where they consider them directly relevant, to inform the House and wider public.

“The Conduct Committee is appointed to review the code of conduct, and it will continue to keep all issues under review. During its review of the code of conduct, the committee considered written evidence from both Unlock Democracy and Transparency International UK, among others.”