Leading article: The Lords must put their house in order over accountability

PERHAPS THE classless society is not yet with us. We all expect MPs in the House of Commons to live by a clear set of rules, but for Peers of the Realm a gentleman's agreement is still deemed sufficient. Last year, a Labour MP, Robert Wareing, was suspended for failing to register an interest in a small business. In the House of Lords, dozens of active politicians keep their financial affairs out of the public gaze without ever breaking the rules.

Today's news that the voluntary system for the registering of peers' interests is to be reviewed could not come at a better time. Planned reforms of the Lords, which will remove the voting rights of hereditary peers who often have little to do with politics, could provide an appropriate opportunity to look again at this issue.

The subject was last discussed three years ago when the Committee on Standards in Public Life, then chaired by Lord Nolan, declared an intention to look into it. A member of the Lords himself, Nolan accepted that the Upper House should be given a chance to put its own house in order. And so a deal was put together under which Lord Griffiths, a former senior judge, headed an internal committee on the subject. The resulting guidelines made it compulsory for peers to list paid parliamentary consultancies and links with lobbying companies. Beyond that, though, the system is entirely voluntary. It is suggested that peers should register interests that might affect what they say in Parliament, and that they should mention them when they speak on related areas.

Despite these strictures, several front bench peers continue to speak on subjects in which they have financial interests without fully declaring themselves. Not surprisingly, given the skeletal nature of the rules, the Privileges Committee reported last December that it had not investigated a single alleged failure to register, nor a failure to mention a consultancy or link with lobbying when speaking.

Some members of the Griffiths committee, notably the Liberal Democrat Lord Rodgers, argued that the rules for politicians in the House of Lords should be exactly the same as for those in the House of Commons. The time has come for this proposal to be renewed. Those who oppose the idea argue that there are fundamental differences between the two houses that would make compulsory registration for peers unfair. Peers, unlike MPs, are not paid salaries for their political work, they say. And shedding a spotlight on their outside interests might drive out the academics and former captains of industry, leaving behind a handful of toffs who would treat the place as a sort of extended Pall Mall club.

These arguments are specious. No one is saying that peers should not earn money outside of politics, nor do the House of Commons rules prevent MPs from doing so. What is important is that the public should have the right to know that politicians' words come from their hearts and not from their wallets.

Nor does the House of Lords' relative lack of power enhance the case for laxity. Local councillors, unlike MPs, are barred from even speaking on subjects in which they hold financial interests. In fact there is one argument for making the rules in the Lords even stricter than those in the Commons: being unelected, peers cannot be removed by voters suspicious of their motives.

This autumn, Lord Nolan's successor, Lord Neill, will face a situation similar to the one that arose three years ago. This time there should be no fudge. Peers should not be allowed to decide whether their own rules are working. Lord Neill should review them, and any peer who is politically active should be forced to make a full declaration of interests.

If the Lords' committee extends a gentlemanly hand to Lord Neill in an attempt to divert him, he should remove his kid gloves before taking it.