Select Committee on Standards and Privileges First Report


Alleged Non-Registration of Interests

  812. Allegations of non-registration and non-declaration clearly have to be judged against the requirements at the relevant time which, in some instances, were less precise or onerous than they are now. Nevertheless, since 1975, Members have always been required to have the general purpose of the Register in mind, which is to disclose any financial or other material benefit which might be thought to affect their conduct as Members or influence their actions in Parliament. Against this requirement it is often a matter of common sense as to whether a particular benefit should be disclosed, even if it does not fall conveniently within a specific category in the Register. But the strong implication is that Members should always err on the side of disclosure.

Mr Hamilton

  813. In addition to the stay at the Ritz (dealt with earlier) the main allegations against Mr Hamilton under this heading are considered below:

      (i)    In 1989 Mr and Mrs Hamilton spent a few days as guests of Mr Al Fayed on the estate of Balnagown Castle. This was clearly a benefit of substantial value and should, in my view, have been registered. Mr Hamilton regarded it as "private hospitality": but this is a concept not recognised by the Register and, given the lobbying he was conducting at the time on Mr Al Fayed's behalf, the benefit could certainly have been thought to affect his conduct as a Member.

      (ii)  Mr Hamilton acknowledged receiving two Harrods hampers - one in 1988 and one in 1989. By today's standards these would be registrable, but I am inclined to think that this may not have been the accepted position at the time.

      (iii)  Unlike most, if not all, other lobbyists, IGA regularly paid commissions to Members who introduced new business. In 1987/88 Mr Hamilton received an introduction commission of £4,000 and a consultancy fee of £7,500 in relation to the National Nuclear Corporation. He registered the latter but not the former, on the grounds that the introduction payment was ex gratia and unexpected. In my view there is no doubt that the introduction commission should have been registered since it might have been thought to affect Mr Hamilton's conduct as a Member. This was also the view of the Select Committee on Members' Interests at the time and, although the Committee recognised that the categorisation of the Register was unsatisfactory, they did not see this as a justification for a failure to register such payments.

      (iv)  In 1989 Mr Hamilton received an introduction fee from IGA of £6,000, which had been agreed in 1988, in respect of US Tobacco (UST). Since this was his second such fee, it could no longer be argued that it was wholly unexpected. It should, in my judgement have been registered during 1989 and, in any event, in January 1990 after the Registrar had specifically reminded Members at the end of 1989 of their obligation to declare single payments.

      (v)  Also in 1989 Mr Hamilton enjoyed a three night stay at a hotel in New York at the invitation of UST. This, I think, was a marginal case, since he was on Select Committee business and his accommodation would have been paid for anyway. Nevertheless, the benefit could still have been thought to affect his conduct as a Member and would have been better registered.

      (vi)  It has been suggested that the payment relating to UST was, in fact, a consultancy fee and not an introduction payment. The evidence to the inquiry of Mr Walter, the former UST executive was not conclusive on this point. But this is not an important distinction if, as is the case, the payment was registrable in either event.

      (vii)  In 1990 Mr Hamilton received £667 from Strategy Network International for a month's consultancy work before becoming a Minister. He suggests that this would have been disregarded, as being de minimis, in 1990 and that, in any case, he resigned his appointment within the four-week period allowed for the registration of a new interest. In my view it is spurious to argue that an interest acquired and relinquished within four weeks is non-registrable; and the amount involved was far from negligible. I conclude that it should have been registered.

  814. There is a general obligation on Members to the effect: "if in doubt, register". Mr Hamilton seems to have adopted the opposite principle and, if in doubt, gave himself the benefit of it.

  815. Running through much of Mr Hamilton's evidence on these matters is a misconception that the scale of a benefit - and thus of any obligation it might be thought to create - is defined by the cost it represents to the giver. This is false. It is the value to the receiver which matters and the fact that this may be notional and not the subject of a formal transaction makes no difference. This has always been the case and there is no reason for Mr Hamilton to have believed otherwise.

Mr Smith

  816. Mr Smith now accepts that he was in error in not registering his interest with House of Fraser when he first received cash payments from Mr Al Fayed. His position on non-registration is exacerbated by the fact that this was not a case of oversight, or an innocent but reasonable misinterpretation of the registration rules: Mr Smith chose not to register his paid employment with Mr Al Fayed, because that was Mr Al Fayed's preference.

  817. In February 1989 Mr Smith acknowledged such an interest - but only hesitantly - following an open letter from Mr Tiny Rowland accusing him of being in Mr Al Fayed's pay.

  818. In my view Mr Smith's Register entries were wholly inadequate and their removal after two and a half weeks was a disingenuous attempt to conceal his financial interest with House of Fraser from public notice.

Sir Andrew Bowden

  819. I have no doubt that the payment by Mr Greer of £5,319 to Sir Andrew Bowden was intended as a contribution to election expenses; and as such, should have been registered. It was not.

  820. Sir Andrew also received lecture fees from Mr Greer. He had an entry entitled "Lecturing and Broadcasting" in the Register. Although the source of funds was not identified, this was probably regarded as adequately meeting the requirements at the time.

Sir Peter Hordern

  821. Sir Peter Hordern properly registered his consultancy with the House of Fraser under the category "Employment or Office". Having done so, he saw no necessity to register hospitality he had received from Mr Al Fayed at the Ritz and Balnagown Castle. In my view the spirit of the Register requirements would have been better observed by separate registration, particularly as the hospitality was personal to Mr Al Fayed, whereas the consultancy was with House of Fraser. On the other hand, the rules were not as clear cut in the 1980s as they are now and I would not see this as grounds for censure.

Sir Michael Grylls

  822. In July 1990 the Select Committee on Members' Interests criticised Sir Michael's entries in the Register as "insufficiently detailed" and for appearing to connect introduction payments received from Mr Greer (on behalf of IGA) to work carried out for the Unitary Tax Campaign "with which they were not associated except in the most tenuous manner." At the same time it concluded that there had been no "clear infringement of the rules."

  823. It can, I think, be safely assumed that the Select Committee would have expressed itself differently had it been aware, not only that the number of commission payments to Sir Michael had been understated, but that, in his evidence to the Committee, Sir Michael had omitted altogether to refer to the direct, regular payments received from Mr Greer or IGA which had the effect of putting Sir Michael on an annual, but undisclosed, retainer with the lobbying organisation. I believe the concealment was deliberate.

Mr Brown

  824. Like Mr Hamilton, Mr Brown received a £6,000 introduction fee from Mr Greer in respect of US Tobacco which was neither registered nor declared for tax purposes. Mr Brown now accepts that the payments (received in instalments) should have been registered; and he has informed the tax authorities of the position so that they may reach a decision on whether the payments were taxable. As with Mr Hamilton, the receipt of a substantial commission payment for the introduction of a company with whom Mr Brown had had an existing, but unpaid, relationship, demonstrates the importance of registration.

  825. Mr Brown received his payments in three instalments during the course of a year. The amount of the commission payment was directly linked to the fees charged by IGA, and if the lobbying contract had not run the course of the year, the introduction fee would, no doubt, have been reduced. Therefore, if either Mr Brown or Mr Hamilton were to continue to promote the interests of US Tobacco, whatever their beliefs and personal views, the House and the public should have been informed, by registration, that a financial relationship existed between the Members concerned and the lobbying company representing UST.

Lady Olga Maitland

  826. Lady Olga's services to Mr Greer were undertaken and paid for before she became a Member. I agree that, under the existing rules, this interest was not registrable or declarable, even though she invoiced Mr Greer for the payment after her election. So far as the 1993 Adjournment debate on the Royal Marsden Hospital is concerned, it is clear that Lady Olga had a legitimate constituency interest in pursuing the matter.

Mr Malone

  827. The allegations against Mr Malone under this heading are that, in November 1985, when PPS to the Secretary of State for Trade and Industry, he met Mr Al Fayed and subsequently reported to Mr Brittan in a way which was helpful to Mr Al Fayed's cause; and that he subsequently received an election donation from Mr Greer of £1,000 at the 1987 election.

  828. In my view Mr Malone has no case to answer. His meeting with Mr Al Fayed was a normal action for a PPS; there is no reason to associate the election donation with a meeting which took place some eighteen months earlier; and since he was not in any case elected in 1987, no question of his registering a campaign donation could have arisen.

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Prepared 8 July 1997