Select Committee on Standards and Privileges First Report


Consolidated pursuant to order of Sir Michael Davies dated 28 April 1995












I, David Hencke, of 119 Farringdon Road, London EC1R 3ER will say as follows:

  1. I am a Reporter employed by The Guardian. I have held that position since 1976 and I have been a journalist since 1968. I am The Guardian's Westminster correspondent and have been the Westminster correspondent since 1986. The contents of this Statement are true to the best of my knowledge and belief. Exhibited to this Statement is an Exhibit marked DH 1 which comprises documents referred to in the Statement; all of the documents have been disclosed in these proceedings. Unless otherwise specified, all page references in this Statement are to Exhibit DH 1.

  2. As The Guardian's Westminster correspondent, I have an ongoing interest in the issue of parliamentary lobbyists generally and their role in the political process. The role of lobbyists at Westminster has become increasingly important over the past 10 years; indeed, during the House of Commons session 1989-1990, the Select Committee on Members' Interests examined the issue of parliamentary lobbying. Ian Greer, the Chairman of Ian Greer Associates ("IGA"), is probably the best known parliamentary lobbyist at Westminster. Mr Greer gave evidence to the Select Committee enquiry in April 1990. Prior to writing my first article about Ian Greer in mid 1993, I was aware that in the course of giving evidence to the Select Committee Mr Greer had said that he had made payments to three MPs in return for them introducing business to IGA. Mr Greer was a reluctant witness on one or two points put to him by the Select Committee as the Minutes of his evidence demonstrates, pages 1-13. He refused to name the three MPs who had received payments from him and in a letter to the Clerk of the Select Committee dated 9 May 1990, he referred to the three MPs under the code names A, B and C, page 14. The Guardian's then political correspondent, Alan Travis, wrote an article about Mr Greer's evidence which was published in The Guardian on 24 May 1990, page 15. That article pointed to the fact that following on from Mr Greer's evidence to the Select Committee, the Registrar of Members' Interests had written to all MPs pointing to the duty MPs had to register commission payments received for introductions where they related in any way to membership of the House.

  3. In or about late June/early July 1993, I had a discussion with The Guardian's then Editor, Peter Preston, in which he told me that he had been speaking to Mohamed Al-Fayed about an unconnected matter concerning relations between the Conservative Party and individuals in the Middle East. Peter Preston told me that in the course of that discussion Mohamed Al-Fayed had also told him, almost in passing, that Mohamed Al-Fayed had made payments to certain MPs, namely Neil Hamilton and Tim Smith at the behest of Ian Greer in return for asking questions in the House. Peter Preston told me further that Neil Hamilton had stayed as a guest at Mohamed Al-Fayed's hotel, the Ritz in Paris in 1987 and that Mohamed Al-Fayed was not prepared to go "on the record" about these allegations. He told me that Mohamed Al-Fayed had not given him any documents. Both Peter Preston and I agreed that these were very serious allegations of impropriety and that the allegations should be investigated. Accordingly, he asked me and another reporter with The Guardian, John Mullin, to devote some time to doing some background work on Ian Greer.

  4. By mid 1993, I was already interested in Ian Greer principally because:

  (i)   He was Westminster's most prominent lobbyist

  (ii)   He appeared to be a reluctant witness before a Select Committee in that he had refused to answer certain questions about payments he had made to MPs.

  (iii)   Other Parliamentary lobbyists had expressed some concerns to me about the way Ian Greer had conducted his business. These concerns focused on a number of matters including the fact that Ian Greer had lobbied on behalf of one or two controversial clients, including for example, the US Tobacco Company campaign for Skoal Bandits, a chewing tobacco which had been banned by the U.K. Department of Health; he had admitted making payments to Members of Parliament and thirdly, he had allegedly provided certain benefits, including providing facilities, to MPs.

  Needless to say, Mohamad Al-Fayed's allegations only increased my interest in him.

  5. After my discussion with Peter Preston, John Mullin and I spent a number of weeks investigating the story on Ian Greer in the period end of June-July 1993 interviewing probably 12-15 people. Some of the material I obtained during this period was used in the story which was eventually published in The Guardian on 20 October 1994. In particular, in the course of talking to sources, a number of allegations were made about Ian Greer which confirmed my view that the relationship between him and certain MPs, in particular Neil Hamilton, had led to practices which I thought brought into focus legitimate public concerns about the way parliamentary lobbying was being conducted in this country. These allegations included the following:

   -    that Neil Hamilton had taken a trip to the Ritz Hotel which was paid for by Mohamed Al-Fayed and in addition to free accommodation, Neil Hamilton, through the good offices of Ian Greer, was able to obtain free air tickets for that trip from British Airways.

   -    That there were particularly close links between Neil Hamilton and his wife and Ian Greer and further, Ian Greer's Managing Director, Andrew Smith used to stay regularly with the Hamiltons. When Andrew Smith stood as a Conservative MP in a seat in a remote Welsh valley, Neil Hamilton who was of course himself in the middle of an election campaign, made a special trip to the constituency to speak on Andrew Smith's behalf.

  6. One of the points which had emerged from my background research was the closeness of the relationship between Neil Hamilton and Ian Greer. John Mullin and I were particularly interested in investigating that relationship not least because of what Mohamed Al-Fayed had told Peter Preston about Tim Smith and Neil Hamilton. Accordingly, in July 1993 both John Mullin and I arranged to see Tim Smith and Neil Hamilton in the House of Commons.

  7. Both John Mullin and I saw Tim Smith in a Committee Room in the House of Commons about mid morning. I cannot recollect the precise date of the meeting but it was shortly before the meeting we had with Ian Greer as referred to in paragraph 10 herein, so it must have been in the second half of July. I did not take any notes during this meeting. I have no difficulty in remembering the details however because it was such a dramatic meeting. Not only did we have a meeting alone with an MP in a Committee room (which is very rare) but secondly, and this was a striking feature of the meeting, Tim Smith was very, very, nervous. John Mullin asked Tim Smith about his relationship with Mohamed Al-Fayed and asked him whether or not he had ever stayed at the Ritz Hotel in Paris. Tim Smith told us that he had done some work on the Lonhro account when he was an accountant with Peat Marwick in 1971. He had taken a bit of an interest in Lonhro thereafter and he agreed that he had put down 17 questions relating to the House of Fraser between October 1987 and January 1989 but had stopped after receiving a threatening letter from Lonhro. He told us further that as a member of the Executive of the Conservative Backbench Trade and Industry Committee (run by Michael Grylls MP) he and several others were invited to an Ian Greer function for the House of Fraser some time in 1985. He told us further that Ian Greer had offered several MPs a visit to the Ritz Hotel in Paris apparently at Mohamed Al-Fayed's instigation. This was the first I had heard of this allegation. Tim Smith told us that he had turned this down because he did not think it was right, although he did accept two big teddy bears from Harrods which he declared in the MPs' Register. We then asked him whether or not he had received payments from Mohamed Al-Fayed in exchange for asking questions on behalf of the House of Fraser in their dispute with Lonhro. He denied that. We asked him whether or not he had received £2,000 cash in a brown envelope for asking questions and he said to that "that is certainly not true". He said that he had not received any money for the conduct of any Parliamentary business.

  8. Shortly afterwards, on the same day, we saw Neil Hamilton on the terrace of the House of Commons. Again, I did not take any notes during this meeting. Neil Hamilton confirmed that he had been a friend of Ian Greer for 15 years and he had been introduced to him through Michael Grylls. He said further that his wife Christine, had formerly been Michael Grylls' secretary. He said that he had been introduced to the House of Fraser through one of its consultants, Sir Peter Hordern. We then asked Neil Hamilton whether or not he had stayed in the Ritz Hotel in Paris as a guest of Mohamed Al-Fayed. He said that "he might have stayed a night or two at the hotel".

  We then pressed him and asked him "are you sure it was not longer". He said words to the effect that it might have been and then we presented him with the dates and the room number. Just prior to the meeting with Tim Smith and Neil Hamilton, I had had a discussion with Peter Preston during which he gave me details of Neil Hamilton's room number at the Ritz and of dates relating to Neil Hamilton's stay there. I had this information on a scrap of paper in the meeting with Neil Hamilton. I now cannot locate that scrape of paper. Then, despite the fact that his memory appeared to have failed him a minute or so earlier, Mr Hamilton went into graphic detail about his stay at the Ritz Hotel and complained that the room he had received had been a bad room with no view and that he thought the Ritz was overpriced. We asked him why he did not declare the stay in the Register of Members' Interests and he did not explain why he had not. He may have mentioned that in his view it was not registrable, or that he had overlooked it. We then confronted him with the cash for questions allegation. Either John or I directly asked him: "Have you received any cash from Mohamed Al-Fayed in return for asking questions in the House on his behalf." I also recollect that we mentioned the figure of £2,000 per question asked. Neil Hamilton denied the allegation. He said that he had never received any payment from Mohamed Al-Fayed or anyone else other than those declared in the Register of Interests. He asked whether we had any documents and I replied that we did not. He had become quite angry by this stage and stormed off. The whole meeting lasted about 20 minutes.

  9. A number of things had impressed me after the two short meetings with Tim Smith and Neil Hamilton - in particular:

   -    That Tim Smith was very nervous when we were speaking to him.

   -    That I had reason to doubt Neil Hamilton's truthfulness. At first he appeared only vaguely to "recollect" a day or two's stay at the Ritz but once we had confronted him with the details of his stay, he then went into some considerable detail about his stay there.

   -    Both had firmly denied the allegation that they had received cash for asking questions in the House.

  10. Both John Mullin and I discussed the progress of our researches with Peter Preston and we agreed that it was time to approach Ian Greer direct with some of the matters that had been put to us. At about the same time, The Guardian received a complaint from IGA's solicitors, Lewis Silkin, about our actions. I had suspected that some people we had spoken to had reported back to Ian Greer - particularly one of Greer's former employees, Anne Pettifer. By agreement, both John Mullin and I attended a meeting with Ian Greer at IGA's offices towards the end of July. Also in attendance at that meeting was Andrew Stone. Andrew Stone is a partner of Lewis Silkin, solicitors, but he informed The Guardian that he was attending in his capacity as a non-executive director of IGA. A tape recording of the meeting we had with Ian Greer appears at Item 295 of the Defendants' List of Documents. The recording is not always easy to hear but in one section, John Mullin and I refer to Neil Hamilton's stay at the Ritz Hotel as Mohamed Al-Fayed's guest which he had not declared in the Register of Members' Interests. Of that stay, Mr Greer said "under no circumstances whatsoever at any time did we make any arrangements for anyone to go there." He denied further that he had "act[ed] as a sort of channel for the Fayeds, to make the arrangements". I note from items 35 and 36 in the Plaintiff's List of Documents, pages 16- 18, that Mr Greer clearly was involved in Mr Hamilton's stay at the Ritz. We then put the allegation concerning cash for questions to Mr Greer although we did not reveal that we knew he was involved. John Mullin said to Mr Greer "one allegation that has been made . . . is that in return for a parliamentary question being asked by a friendly MP, a brown envelope stuffed full . . . would be passed . . .". Mr Greer replies "I have absolutely no knowledge of this".

  Mr Greer had accordingly denied any knowledge of Mohamed Al-Fayed's allegation concerning "cash for questions".

  11. After the interview with Ian Greer, I was then ready to write a story about him which I did. As referred to above, Mohamed Al-Fayed at that stage, had made it very clear to the Editor that he did not want to be named as the source of the story and for that reason, Peter Preston wrote the section in the story which deals with Neil Hamilton's stay at the Ritz to ensure that no specific mention was made to either Mohamed Al-Fayed or the Ritz. It was clearly impossible to run the "cash for questions" aspect of the story with Mohamed Al-Fayed not being prepared to "go on the record". In addition, he was still refusing to hand documentary evidence over to Peter Preston.

  12. We made one or two additional enquiries after July of clients of IGA and then at the end of September 1993, I attended the Labour Party Conference. At about that time, I was contacted by a man by the name of Peter Jukes who told me that he was writing a play about Parliamentary lobbyists and he was going to be attached to IGA throughout the Labour Party Conference to get an inside view of how Parliamentary lobbyists worked. During that Conference, Jukes met with me a couple of times as well. Something quite odd occurred during the Conference - I was told by a lobbyist who I spoke with at one of the functions, that Andrew Smith, IGA's Managing Director appeared to be following me. It was extremely odd but every time I appeared to move out of Andrew Smith's eyesight, he accordingly moved. At one stage, I noticed Andrew Smith hiding behind a pillar watching me; when I moved, he did.

  13. At about this time, Neil Hamilton wrote a letter to Peter Preston at The Guardian, dated 1 October 1993, pages 19-22. I do not know why Mr Hamilton wrote to Peter Preston on that date (after all, I had interviewed both him and Ian Greer months before) but perhaps he had heard via Ian Greer that I had been talking to other lobbyists at the Labour Party Conference. In the event that letter contained a number of inaccuracies which I pointed to in an article I wrote 12 months later, published in The Guardian on 25 October 1994, page 23.

  14. My article about Ian Greer was published in The Guardian on 5 October 1993, page 24. I recollect that on the day of publication, Ian Greer was having a reception and both John Mullin and I went to the reception although we did not intend to go in because we had not been invited. In fact Ian Greer welcomed both of us with open arms and was extremely hospitable. Neil Hamilton was there and, in passing, told me that he had been on the telephone to Peter Carter-Ruck.

  15. Shortly after publication of the article on 5 October 1993, I was contacted by Sylvia Jones who told me she was a researcher with the Central Television Programme, the Cook Report. She told me that she wanted to do a Cook Report style programme on IGA and wanted access to some of my contacts. My recollection is that the Cook Report had to wait until early 1994 to get the go ahead to do the story which involved reporters posing as clients for the purpose of obtaining information about IGA's methods. I introduced her to a couple of my contacts and as the Cook Report drew up more detailed plans, they decided to employ me as a consultant to the programme. I had a series of meetings with one of Central Television's senior managers involved with the Cook Report, Clive Entwhistle, and together we tested the idea of the investigation they were about to undertake. One of the principal points they wished to explore was precisely what courses of action it would and would not be ethical for a Parliamentary lobbyist to pursue. During these conversations, I told the Cook Report about what I had found out about the very strong relationship between Ian Greer and Neil Hamilton and various other matters. During the course of my consultancy, I obtained transcripts of meetings held between representatives of the Cook Report (acting under the guise of employees of a front company set up for the purpose of the investigation, ECOCON Ventures Inc) and IGA and correspondence between IGA and ECOCON Ventures Inc. Some of this material is relevant to the issues in this action and has been disclosed in the proceedings. I refer in particular to:

  (i)   the letter from Jeremy Sweeney of IGA to ECOCON's president which refers to Neil Hamilton as being a member of "a carefully selected group" which IGA was going to bring together for ECOCON, pages 25-28.

  (ii)   the transcripts of the conversations at pages 29-73 in which representatives of Ian Greer refer a number of times to IGA's contact with Neil Hamilton and

  (iii)   the transcript of the conversation between Ian Greer and ECOCON employees, pages 74-94 which includes the following exchange between Ian Greer and an ECOCON representative at page 83:

   ECOCON representative: Erm . . . but . . . placing em . . . placing questions . . . is that . . . I mean it seems very straightforward here that you just can get someone to. . .ask the right questions to make . . . to put . . . to jockey your . . . information gathering into the right position.

   Ian Greer: We . . . we . . . we would never go out and say . . . we can arrange to have a question tabled . . . erm . . . but actually we can . . . erm . . . if we went out and said that er . . . there's bound to be someone who would take great offence . . . er to think that a middle man . . . could arrange such a thing, but . . . er as it happens . . . erm . . . yes of course we do."   In my view another of Mohamed Al-Fayed's allegations was confirmed - Ian Greer was freely admitting that he could arrange to have questions tabled in the House by certain MPs.

  16. In the event, Central Television executives halted the Cook Report investigation; I wrote up a number of their findings, however, in an article published in The Guardian on Thursday, 12 May 1994, pages 95-96.

  17. The critical point raised in the transcripts obtained by the Cook Report was the assertion by Ian Greer that IGA's contacts with Conservative Ministers and MPs was such that they were able to get MPs to table Commons questions to benefit their clients. Accordingly, a number of MPs including Liberal Democrat and Welsh Nationalist MPs backed a Commons Motion inviting the Select Committee to order Central Television to make the film available for a Commons enquiry into lobbying activities, pages 97-98. Neither Ian Greer nor IGA complained to The Guardian about the article published on 12 May 1994, although its directors wrote to a number of MPs about it. I was able to obtain a copy of one of these letters dated 19 July 1994 written from Robby Macduff, an IGA director, to Jeff Rooker MP, pages 99-101.

  18. The issue of MPs tabling questions in return for cash had been one which had been the subject of a number of rumours circulating throughout Westminster for some time. On 10 July 1994, the Sunday Times published its story which confirmed that at least two MPs, David Treddinick, MP for Bosworth and Graham Riddick, MP for Colne Valley, had accepted cash from a businessman in return for tabling questions, pages 102-103.

  19. At or about the time of the Labour Party Conference in 1994 - I think it was towards the end of the second week of October - Peter Preston told me that Mohamed Al-Fayed had now changed his mind and was prepared for The Guardian to publish the names of the MPs who had taken cash from him in exchange for asking questions in the House, namely, Neil Hamilton and Tim Smith. He was also prepared to let it be known that it was the Ritz Hotel that Neil Hamilton had stayed at and that he, Mohamed Al-Fayed, had paid for that stay. I did not go and see Mohamed Al-Fayed immediately - I remember that I was at the time covering one of the more important speeches of the political year, namely the Prime Minister's speech at the Conservative Party conference. I went to see Mohamed Al-Fayed on the evening of 18 October, 1994. This was the first and only time that I had met Mohamed Al-Fayed before publication of the matter complained of. I would have spoken to Mohamed Al-Fayed for only 10 or 12 minutes. I spoke to a colleague of Mohamed Al-Fayed's, Michael Cole, for about 20 minutes beforehand. The notes I took at this meeting appear at item 287 of the Defendant's List and a literal transcript of the notes at pages 104-108. The final page of the transcript, page 108, however is a note of a discussion I had on 19 October 1994 with a Liberal Party press officer. The notes do not record everything that Mohamed Al-Fayed told me at the meeting. At the meeting with Mohamed Al-Fayed I was told the following:

  (i)   Mr Greer had contacted Mohamed Al-Fayed in the early days of the Lonrho/House of Fraser dispute and told him that his case was being badly presented. Mohamed Al-Fayed said that Greer had told him that he would need MPs to present his case in Parliament and that ªthese people are able to rule the country - you can buy them like you rent a taxi, a London taxi, you rent an MP". I was particularly struck by this comment because he had used the word "rent" rather than the word "hire".

  (ii)   The sum of £50,000 was paid by House of Fraser to IGA as a fee.

  (iii)   Neil Hamilton and Tim Smith MP were paid by Mohamed Al-Fayed sums of cash in return for them asking questions about the House of Fraser/Lonrho dispute in the House of Commons. Mohamed Al-Fayed said further that the payments worked out at £2,000 for each question. I said to him that I understood that the two MPs had asked 17 questions in the House relating to House of Fraser/Lonrho and accordingly, I assumed that a total of £34,000 had been paid over. Mohamed Al-Fayed indicated that this was probably right.

  In addition, Mohamed Al-Fayed mentioned the figures of £8,000 and £10,000 which he said were paid monthly to IGA. From what Peter Preston had previously told me, although Mohamed Al-Fayed did not expressly refer to this fact, I understood that the payments were made to Smith and Hamilton via Ian Greer.

  (iv)   Mohamed Al-Fayed confirmed further that Neil Hamilton and his wife had stayed for a week at the Ritz. He said to me that they "returned for afternoon tea" and even while still in France, had rung up the hotel asking to come again. Mohamed Al-Fayed said that "[he] told the President of the Ritz Hotel to tell [Neil Hamilton] the hotel was full up. I never asked him to stay". Mohamed Al-Fayed made a number of other comments about the stay at the Ritz Hotel which appear in the article The Guardian published.

  (v)   Strikingly, Mohamed Al-Fayed compared Neil Hamilton and Tim Smith with Dale Campbell Savours. Of Dale Campbell Savours he said that he [Campbell Savours] "did not want to receive anything" and Campbell Savours never as much as took a cup of coffee from him. Of Peter Hordern, Mohamed Al-Fayed said that Peter Hordern had been representing the House of Fraser for years.

  I do not remember whether or not Mohamed Al-Fayed mentioned giving Neil Hamilton shopping vouchers - he may have done so in passing. Peter Preston had certainly told me that Mohamed Al-Fayed had given shopping vouchers to Neil Hamilton. I was not as interested in the vouchers as I was in the cash.

  At the end of the meeting, I was given a teddy bear by Mohamed Al-Fayed and a book on the Ritz - I was embarrassed about receiving these gifts but felt it was ungracious not to take them. One of the things that struck me most about what Mohamed Al-Fayed had said was not only that Ian Greer himself had approached Mohamed Al-Fayed (and not the other way round) but Ian Greer personally had chosen Neil Hamilton and Tim Smith as the MPs who would ask the questions. Although this point is not expressly referred to in my note, I have a clear recollection of it. I thought it was absolutely astonishing that Members of Parliament were being touted by a Parliamentary lobbyist.

  20. During this meeting, Mohamed Al-Fayed gave me a copy of the bill from the Hotel Ritz in Paris which provided all details of the stay by Neil Hamilton and his wife from 8 September 1987 until 14 September 1987, pages 109-110. This was the first time that I had seen a copy of the bill and it was the only document I received from Mohamed Al-Fayed.

  21. I knew that Peter Preston was working along parallel lines with me and had been speaking separately with Mohamed Al-Fayed. I discussed my meeting with Peter Preston on the morning of the 19 October and he agreed that I should endeavour to write the full text of the article by early afternoon so that the lawyers could see it. I had a number of discussions with Peter Preston throughout the day about the article and to a lesser extent, with the night editor, Paul Webster, who needed to know details about length and format, etc.

  By that time, Peter Preston had received a number of further documents from Mohamed Al-Fayed providing documentary evidence of the Hamilton and Smith/Greer/ questions nexus. The documents I had in my possession at the time of publication which we had received from Mohamed Al-Fayed (over and above the Ritz bill) appear at pages 111-123.

  22. Peter Preston and I thought that we should send a short fax to Ian Greer, Neil Hamilton and Tim Smith to let them know that we intended publishing an article about them the next day. We shared the view that there was no need to go into any particular detail in these facsimiles as the principal allegations had been put to the three protagonists beforehand, and they had been denied. I recollect that we arranged for the faxes to be sent to the facsimile numbers of the MPs' private secretaries to ensure that they came to the MPs' attention. In addition we rang their secretaries to inform them that they were coming. My recollection is that I made those telephone calls. The facsimile to Neil Hamilton is at page 124. In that facsimile I point out to Neil Hamilton that I now had in my possession, many of the documents involved in the "campaign" referred to. This was one of the principal things that had changed since I had spoken to Neil Hamilton in July 1993 - during that meeting he had asked me whether I had any documents and I said that I had not. In fact I did not receive any documents until two days before publication namely the copy of the Ritz bill from Mohamed Al-Fayed on the evening of the 18 October and the others (at pages 111-123). I cannot now locate the copies of the faxes that I sent to Tim Smith and Ian Greer but of the three facsimiles, only Ian Greer replied. I recollect that the only thing he said in his reply really was that he would sue.

  23. After I had written the article to be published on 20 October 1994, Peter Preston told me that he had had a telephone conversation with the Press Office of the Liberal Democrats and he suggested that I telephone them. I rang the Liberal Democrats' Press Officer to find out what plans they had to raise the issue in the Commons that evening. The Press Officer told me that Alex Carlile would raise it in the House and he also provided me with a quotation of what Alex Carlile was likely to say. My notes of that conversation appear at page 108. I then attended at the House of Commons about 8.30 that evening and had a meal with the Liberal Democrat Press Officer to whom I had spoken. After dinner, I dropped in to see Alan Williams, MP and told him about The Guardian's article. I believe he then spoke to certain Labour Whips and I found out later that evening that one of the Labour Whips had decided that a Labour MP, Stuart Bell, should raise the matter in the House if the Liberal Democrats failed to. I attended in the House of Commons that evening and as it happened, Stuart Bell was the MP who raised the issue. I did not discuss the matter that evening with anyone else at the House other than Alan Williams MP.

  24. The matter complained of was published in The Guardian on 20 October 1994, pages 125-126.

  25. I have read the Replies served by the Plaintiffs in these proceedings. My comments are as follows:

  (i)   It is not my practice to send facsimiles to people about whom I am about to write a story. It is my practice however, to speak to those people beforehand. In preparation for the article which was published on 20 October 1994, I had put the allegations fairly and squarely to both Plaintiffs in July 1993. Having put the allegations to them then, I had no reason to suppose that they would change their stories and that I needed to put them to them again. Having said that, because both Tim Smith and Neil Hamilton were Ministers, I thought that it was essential to at least warn them that The Guardian was about to publish an article about them and hence the facsimiles were sent to Tim Smith, MP and the two Plaintiffs on the evening before publication.

  (ii)   I knew of course what had been written about Mohamed Al-Fayed in the context of the DTI enquiry. I was also suspicious of some of the allegations that Mohamed Al-Fayed had made to Peter Preston and which Peter Preston had passed on to me. Other background work I had done however, together with the documentation that had been provided to Peter Preston from Mohamed Al-Fayed, convinced me that Mohamed Al-Fayed was telling the truth in relation to the cash for questions issue. In addition, I believed that he would hardly want to incriminate himself for bribing Members of Parliament. Indeed, Michael Cole had told me just before I met Mohamed Al-Fayed on 18 October 1994, that Mohamed Al-Fayed was going ahead with his interview with me, despite receiving advice to the contrary.

  (iii)   I was not aware of Mohamed Al-Fayed's citizenship application before I saw him on 18 October. I was aware however, that he had recently lost his appeal to the European Court of Human Rights. I knew as well that he was bitterly disappointed at this loss and of course it occurred to me that that might colour his judgement. But he had made the allegations concerning cash for questions and Neil Hamilton's stay at The Ritz Hotel to Peter Preston back in July 1993. I had incontrovertible evidence about Neil Hamilton's stay at The Ritz Hotel and I knew that Neil Hamilton had attempted to lie to me about that when I interviewed him in July 1993. I knew further that the consequences of publication for Mr Hamilton would be very grave but as a responsible journalist, I could not allow that to deter me. In any event, it was a matter for the Prime Minister at the end of the day as to whether Neil Hamilton remained a Minister or not. As it happened of course, Neil Hamilton did not resign as a result of The Guardian's article but as a result of other matters which emerged after publication of the matter complained of.

  This article raised issues of very considerable public interest. This is clearly evidenced by the nature of the debate which had commenced prior to October 1994 about Ministers receiving undeclared benefits in exchange for rendering Parliamentary services and it is a debate which continued long after publication of this article, and, directly as a result of it.

  26 June 1995

13   Not all the documents originally attached to the witness statement are printed. Internal page references relate to the original documents. Back

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