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Mr. Tom King (Bridgwater): As someone who, in his time, had to sign PII certificates to protect essential

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intelligence information, but who did so always on the clear understanding that the judge had full access to the information and could decide whether it ran the risk of prejudicing the rights of defendants, may I say how pleased I am to hear that, as I understand Sir Richard Scott has made clear, there is no evidence whatever of some conspiracy to send innocent men to gaol?

In answer to the second smear, that in some way we sent lethal arms to Iraq, is my right hon. Friend aware that I walked round the largest lorry park in the world at Al Jubail at the end of the Gulf war and personally inspected a vast range of equipment that we had captured from the Iraqis? I found there lethal equipment from a whole range of countries but, from the United Kingdom, I found one Land Rover. That bore out my own evidence and impression that Sir Richard Scott's conclusion--that we scrupulously observed the guidelines about the sale of lethal weapons--was correct.

Mr. Lang: I am most grateful to my right hon. Friend, and I am happy to reassure him on public interest immunity. The report confirms the behaviour of all right hon. and hon. Members who signed PII certificates. The Government's clear view is that the advice given by the Attorney-General is supported by a range of senior judges--that Ministers had a duty to sign, the trial judge decides, PIIs are not gagging orders and PII law is court-made law, not Government law.

My right hon. Friend is absolutely right about evidence on the ground in Iraq and Kuwait. Any variation in the application of guidelines is the result of the oncome of peace in 1988. That was the major change that led to the application of guidelines affecting different products.

Mr. Gerald Kaufman (Manchester, Gorton): Will the right hon. Gentleman refer to the section in the report that deals with the letter that the Prime Minister sent to me on 17 February 1992, which Lord Justice Scott says was misleading? [Hon. Members: "Oh."] I shall certainly do every justice to the Prime Minister. Will the Secretary of State refer to that letter, in which the Prime Minister wrote:

Sir Richard says that that letter was "misleading". He says also, at paragraph D4.16:

If the Secretary of State looks further at that section, he will see that the Prime Minister unknowingly sent me an inaccurate letter, because an originally truthful letter was deliberately doctored by the right hon. Gentleman's private secretary at the Foreign Office, to remove the truth. If the Secretary of State will refer to paragraph D4.13, he will see that the root of the untruth that the Prime Minister unknowingly sent to me lay in the action of the present Chief Secretary to the Treasury. Sir Richard Scott makes it clear that the letter that theChief Secretary sent to the hon. Member for Lancaster

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(Dame E. Kellett-Bowman) was untrue. Sir Richard confirms that the Chief Secretary sent a letter that was untrue. How can he remain in office?

Mr. Lang: This whole question turns on whether or not the guidelines were changed. Sir Richard Scott concludes that the guidelines were changed, but he accepts that all Ministers throughout the period in question were of the view, and continued to be of the view, that the guidelines had not changed, that they acted entirely in good faith and that the flexibility that they used was applied in the light of changing circumstances.

After the ceasefire, items that had been refused before it--such as hovercraft spares to Iran and mobile radar equipment to Iraq--were approved, but still refused in those continuing guidelines were high-grade secure radios, Hawk trainer aircraft, phototypesetting spares, metal detectors, modems and optical disc drives. I thought that the right hon. Member for Manchester, Gorton(Mr. Kaufman), having read the report's findings, would bear it in mind that he said in 1992:

I thought that the right hon. Gentleman would come to the House to apologise, having slandered the Government.

Sir Michael Grylls (North-West Surrey): Does my right hon. Friend accept that it is perfectly clear from the Scott inquiry that in the difficult decisions that Ministers had to take over a long period, they acted honourably--and that the people who have acted dishonourably are Opposition Members, with their smear campaign? Does my right hon. Friend agree that it is important to remember that the defence industries are among our most important exporters and largest employers in the country? If the Opposition had had their way, they would have banned arms exports to innumerable countries, with the loss of millions of jobs and millions of pounds' worth of exports. Should not the whole thing be put in that context as well?

Mr. Lang: My hon. Friend is right, but as a result of the strict control and strict policy on defence-related exports that this country followed between 1985 and 1990 we contributed only around 1 per cent. of Iraq's defence-related imports. Under the last Labour Government, the value of total exports to Iraq rose from £61 million in 1974 to £427 million in 1979.

Mr. Faulds: Is it not the case that the report makes clear that the guidelines were changed, that certain named Ministers changed them, however much they have forgotten the significance of the change in the words, and in that case, why was the House lied to?

Mr. Lang: The House was not lied to. Sir Richard Scott accepts that no Minister deliberately misled the House and that all Ministers believed sincerely throughout the period that the guidelines that they were using remained the same as the ones originally set up in 1984.

Sir Peter Hordern (Horsham): Did defence counsel acting for Matrix Churchill have any cause for complaint

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in the handling of the public interest immunity certificates? During the Scott inquiry, was there any evidence, on the part of my right hon. Friend the Chief Secretary or my right hon. and learned Friend the Attorney-General, of deliberate misleading of the House? If that were the case, such a charge, to the knowledge of my right hon. and hon. Friends, would be a most ludicrous one.

Mr. Lang: My right hon. Friend raises the question of defence counsel in the Matrix Churchill trial. That counsel specifically supported the signing of PII certificates. The judge in that trial acknowledged that PII claims were properly made. He saw all the documents: he instructed the disclosure of some and not others, and he expressly noted the terms of the PII certificate of my righthon. Friend the Deputy Prime Minister. On the question of misleading the House, with regard to the signing of letters by my right hon. Friend the Chief Secretary, Sir Richard Scott's report says:

Sir Richard makes no charge against any Minister of having deliberately misled the House.

Mrs. Margaret Ewing (Moray): Despite your wise advice on 7 February, Madam Speaker, may I point out that, despite a request to the Department of Trade and Industry for prior access to the report for Plaid Cymru and the Scottish National party, that facility was not afforded to us. That is an abuse of a situation in which a request was put directly to the President of the Board of Trade. Therefore my comments can be only brief. I refer the right hon. Gentleman to volume IV, chapter 8, which clearly states that in 1985:

in answer to a parliamentary question. The following page states that there was

in Baghdad. That obviously impinges severely on the arms trade issue in general. I hope that we can discuss that matter in detail in the next debate. Will the President of the Board of Trade now tell us who was refusing to disclose the guidelines and who was organising the concealment?

Mr. Lang: The hon. Lady should understand that the guidelines are not statutorily based but self-imposed. They were established by my right hon. and noble Friend Lord Howe when Foreign Secretary as an operational arm of policy to assist in decision-making. It was felt that there was no immediate need to publish them. When they were published in October 1985, some nine months after they had originally been drawn up, that drew no complaint and no unexpected attitude on the part of any right hon. or hon. Member who discovered them. They were not the full embodiment of policy; they were the way by which decisions were made on a day-to-day basis on many tens of thousands of export licence applications so that the Government's strict control over arms and defence-related exports to Iraq could be carried out.

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