Opinion: A stench that starts at the very top

by Stephen Tall on June 8, 2007

Yet more news, as reported in today’s Guardian, of the Labour Government’s complicity in bribes paid by BAE to a Saudi prince to secure a huge arms deal:

British investigators were ordered by the attorney-general Lord Goldsmith to conceal from international anti-bribery watchdogs the existence of payments totalling more than £1bn to a Saudi prince, the Guardian can disclose.

The money was paid into bank accounts controlled by Prince Bandar for his role in setting up BAE Systems with Britain’s biggest ever arms deal. Details of the transfers to accounts in the US were discovered by officers from the Serious Fraud Office during its long-running investigation into BAE. But its inquiry was halted suddenly last December.

(There’s more over at the Lib Dems’ Corruption is a crime website.)

There is an irony that, though the police’s ‘cash for honours’ investigation has been far more damaging to Labour’s reputation, and to the Prime Minister personally, it is the ‘BAE bungs’ scandal which is much the more serious.

There are two main points of principle at stake here.

1) The so-called ‘war against terrorism’ should not be used by this Government as its alibi for a cover-up.
When the BAE payments were first revealed, Mr Blair argued Saudi Arabia had to be kept on-side otherwise the UK might forfeit their co-operation in the fight against Al-Qaeda. To put it another way: Mr Blair was content to be blackmailed by a supposed ally. It should be said, the Prime Minister’s flimsy claim was later refuted by John Scarlett, head of MI6.

2) Jobs are important, but the rule of law matters more.
The Prime Minister has always denied that the jobs at stake from the BAE arms deal was ever a consideration in the Government stopping the Serious Fraud Office’s investigation. We know this because Mr Blair is at great pains to explain, whenever questioned, that jobs were not a consideration when the Government ordered an investigation into alleged corruption to be stopped. The Economist’s editorial in December 2006 was spot-on:

… jobs are not worth having at any price, and here the cost is considerable. People in countries where backhanders are a way of life see resources squandered and become disillusioned with public institutions. In developed countries, people may come to think that there is one rule for big firms doing big deals with big oil-rich countries and another for everyone else. … The ditching of the SFO inquiry will feed the cynicism already widespread in Britain.

It is not just British cynicism which matters. Mr Blair has sought to show Britain, allied to the USA, as torch-bearers for democracy. His squalid handling of the BAE scandal, and total disregard for the value of the rule of law, pulls the rug from under this supposed high-mindedness.

Mr Blair, as leader of the opposition, was quick to denounce John Major’s scandal-ridden Tory Government during the arms-to-Iraq affair. Now he finds himself in office, Mr Blair has lost the ability to tell right from wrong.

Power really does tend to corrupt; which is why we must be on our guard against Labour’s ceaseless efforts to create absolute power for the state.