Select Committee on Standards and Privileges First Report


APPENDIX 15 - Continued

1994-H-No-1654

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
BETWEEN
(1) NEIL HAMILTON

Plaintiff

and
(1) DAVID HENCKE
(2) PETER PRESTON
(3) GUARDIAN NEWSPAPERS LIMITED

Defendants


DRAFT/AMENDED DEFENCE

  1. Paragraph 1 of the Statement of Claim is admitted.

  2. Save for the word "enormous" (which is not admitted), paragraph 2 of the Statement of Claim is admitted.

  3. The Defendants admit publication in The Guardian on the 20 October 1994 of the words set out in paragraph 3 of the Statement of Claim, and they further admit that the said words refer to the Plaintiffs. Save as aforesaid, paragraph 3 of the Statement of Claim is not admitted.

  4. The Defendants do not admit that the said words bore or were understood to bear the meaning pleaded in paragraph 4 of the Statement of Claim, whether in their natural and ordinary meaning or by innuendo.

  5. Further or alternatively, in their natural and ordinary meaning and /or in any innuendo meaning which the Plaintiffs may establish at the trial, the said words are true in substance and in fact. If and insofar as may be necessary, the Defendants will rely upon section 5 of the Defamation Act 1952.

PARTICULARS OF MEANING

  The Defendants will justify the said words in the following meanings.


  (A)   that the Plaintiffs for reward convened and co-ordinated the activities of a group of four Members of Parliament as a parliamentary lobbying operation for House of Fraser and Mr Mohamed Al-Fayed, including arranging for questions to be asked and motions to be tabled in the House of Commons, arranging for MPs to correspond and meet with Ministers and passed payments amounting to thousands of pounds assisting in making payments to MPs including Mr Tim Smith MP and Mr Neil Hamilton MP in relation to their said services, on top of thousands of pounds paid and other benefits provided to them by Mr Al-Fayed direct.


  (B)   if necessary, the Defendants will allege that the same was done corruptly and in breach of the privileges of the House of Commons (as defined in the extract from Erskine May quoted in paragraph 4 of the Statement of Claim).


  (C)   irrespective of (B), it will be alleged that the Plaintiffs directed the Parliamentary activity of MPs for the benefit of Al-Fayed and of IGA, in the knowledge that the MPs were receiving rewards in respect of such activity which were not being properly declared or registered.

PARTICULARS OF JUSTIFICATION

  (1) On the evening of 28 October 1985, the first Plaintiff (hereinafter "Greer") met Mr Mohamed Al-Fayed ("Al-Fayed"), and agreed in principle that the second Plaintiff (hereinafter "IGA") would act as "Political Advisers" to him for a period of a year at a fee of £25,000 plus VAT

  (2) Within two days, Greer had spoken to Mr Neil Hamilton MP ("Hamilton") who was then Vice-Chairman of the Conservative Party's Trade and Industry Committee (and thus potentially a key figure in Al-Fayed's battles against Mr Rowland and Lonrho, which significantly took the form of both sides placing pressure on the Department of Trade and Industry to investigate and take action in relation to the conduct of the other side in its attempts to acquire House of Fraser and in other respects). Hamilton had immediately agreed to table a parliamentary question to the Secretary of State for Trade and Industry in a form drafted for him by IGA and one of Al-Fayed's advisers. On the 7 November 1985 two questions by Hamilton were accordingly published in the House of Commons order paper.

  (2A) Further on 31 October 1985 Greer met Michael Grylls MP, Chairman of the Conservative Party's backbench Trade and Industry Committee in connection with Al-Fayed.

  (3) These matters and Hamilton's willingness to table parliamentary questions and the answers to the parliamentary questions, were duly reported by Greer to Al-Fayed in order to assist Greer/IGA in agreeing their retainer with Al-Fayed. On 7 November 1985, Greer wrote to confirm that IGA would act as "political advisers" to Al-Fayed for a period of one year from 1 November 1985, at a fee of £25,000 plus VAT.

  (3A) On 11 November 1985, Greer took Gerry Malone MP, Parliamentary Private Secretary to the Secretary of State for Trade and Industry, to meet Al-Fayed.

  (4) On the 17 June 1986, in an adjournment debate in the House of Commons, Mr Tim Smith MP, ("Smith") raised the issue of the independent directors of The Observer newspaper and interference by Mr Rowland, and accused Mr Rowland of running a series of false stories amounting to a personal vendetta against the Fayed brothers.

  (5) From 1986 until 1990 this time onwards, Hamilton and Smith were members of a group of four Members of Parliament (the other two being Mr Michael Grylls and Mr Peter Hordern), co-ordinated by IGA, who (together with a fifth MP, Andrew Bowden, between February and July 1987) comprised the parliamentary lobbying operation for House of Fraser and Al-Fayed, and who (separately or together) regularly met with IGA and Al-Fayed to discuss tactics.

  (5A) Greer instigated and directed parliamentary activities by the group collectively and by its members individually, as in his judgment the interests of Al-Fayed and his own business with Al-Fayed required. In particular, he arranged for questions to be asked in Parliament, for Early Day Motions to be tabled in Parliament and for letters to be written to Ministers (the questions, EDMs and letters being mostly drafted in whole or in part or in consultation with Greer/IGA or Al-Fayed's lawyers) and for delegations briefed by Greer or Al-Fayed's lawyers to meet Ministers. The occasions relied upon are set out below and in an annexed chronology.

  (5B) Between 1985 and 1990, Greer/IGA received very substantial payments from Al-Fayed in respect of the activities referred to in Paragraph 5A above:

  (i)   Greer/IGA submitted monthly bills to Al-Fayed, which were paid by standing order. Between 1985 and 1990, the total of such bills was approximately £136,000;

  (ii)   an additional payment of £18,000, as pleaded in paragraph 9 below;

  (iii)   an additional payment of £13,333, as pleaded in paragraph 30 below;

  (iv)   additional regular cash payments, provided by Al-Fayed to Greer/IGA in a sealed envelope. Greer or a member of IGA staff telephoned Al-Fayed's office at 60 Park Lane to ask whether an envelope or money had been left for him. On at least half a dozen occasions, cash payments in a sealed envelope (consisting variously of approximately £3,000, £6,000 or £9,000) were delivered by Al-Fayed's PA, Alison Bozek, to the front desk of 60 Park Lane for collection by Greer/IGA; on other occasions Al-Fayed's secretary, Iris Bond, arranged for further cash payments in a sealed envelope (amounting to approximately £2,500) to be left at the front desk of 60 Park Lane for collection by Greer/IGA or to be couriered to Greer/IGA. On (at least one occasion), Greer collected the envelope in person. On 19 September 1988 Greer telephoned Al-Fayed's office to state that payment was due for July, August and September; and on 4 November 1988, Greer telephoned asking for £5,000 for those months.

  (6) Between the 11 March 1987 and the 23 January 1989, Smith asked a total of 28 questions in the House of Commons relating to the alleged misdeeds of Lonrho, or the Department of Trade and Industry investigation of House of Fraser and Al-Fayed, or Mr Rowland's circulation of defamatory material concerning Al-Fayed (in particular a booklet entitled "A Hero from Zero"; on the 23 January 1989 Smith asked the Solicitor-General whether he would be recommending it for the Booker prize for fiction). Subsequently, Mr Smith received a letter from Mr Rowland, accusing Smith of receiving payments, which accusation Smith discussed with Greer and with Al-Fayed's lawyer. Thereafter, Mr Smith's activity in support of Al-Fayed was greatly reduced by Greer; Hamilton's role in asking parliamentary questions was increased.

  (7) On or about the 24 February 1987, the Secretary of State for Trade and Industry was pressed in a parliamentary question tabled by Hamilton to respond to letters from Al-Fayed and one of his professional advisers.

  (8) On the 10 March 1987, Hamilton tabled an Early Day Motion deploring parliamentary attacks upon Al-Fayed and congratulating the Government for allowing Al-Fayed's company to acquire Harrods.

   (8A) On 3 April 1987, Greer/IGA wrote a "private and confidential" letter to Hamilton, inviting him and his wife, with other parliamentary colleagues to join Al-Fayed for a weekend in Paris, staying at the Ritz. Greer wrote that the invitation was "in every way a private invitation and I would therefore be grateful for it being kept as such". Greer/IGA also invited the following persons to visit Paris as guests of Al-Fayed: Tim Smith, Andrew Bowden, Michael Grylls, Peter Hordern, Sir William Clark. However, on 10 April 1987, Greer/IGA wrote a further "private and confidential" letter to Hamilton and the other prospective guests, stating that he thought it would be "inappropriate" for the visit, planned for 25-26 April, to go ahead in the light of the previous day's announcement by the Secretary of State for Trade and Industry concerning the inquiry into the House of Fraser.

   (8B) On the 13 May 1987, a delegation briefed by Greer/IGA consisting of Hamilton, Smith, Hordern and Grylls met Paul Channon, a Minister at the Department of Trade and Industry.

  (9) On the 18 May, Al-Fayed gave to Greer cheques totalling £18,000 for the stated purpose of placing IGA in funds to make payments to MPs including Hamilton the Plaintiff and Mr Tim Smith MP for their work on Al-Fayed's behalf inter alia in tabling parliamentary questions and motions, and in writing letters to and meeting Ministers. Following the receipt of this money, Greer/IGA made various payments to the Plaintiff in cash or kind and made payments to or on behalf of other MPs who might in the future be useful to Al-Fayed and/or to other IGA clients, including Andrew Bowden who received a total of approximately £6,000.

   (9A) On 23 July 1987, Hamilton wrote to Al-Fayed announcing his election as Secretary to the Conservative Finance Committee and as Vice-Chairman of the Conservative Trade and Industry Committee, which (he wrote) gave him a "better position" to act on Al-Fayed's behalf. Hamilton enclosed a copy of a letter of the same date, written by Hamilton "as Vice Chairman of the Conservative Trade and Industry Committee", to the Chairman of the Stock Exchange, advancing Al-Fayed's interests.

   (9B) On the 29 July 1987, Hamilton and Hordern met David Young, a Minister in the Department of Trade and Industry, which meeting followed a meeting at Harrods between Hamilton, Hordern, Al-Fayed and one of his advisers.

  (10) Over the next two and a half years, Hamilton received from Al-Fayed personally at face to face meetings, in the form either of cash (which was handed over in instalments of £2,500 in £50 notes) or of Harrods gift vouchers in £100 denominations, a total of £28,000 (or thereabouts), for the most part in cash. The said sums were handed over at meetings either at Harrods or at Al-Fayed's Park Lane offices on the following dates: 2 and 18 June and 8 July 1987; 18 February, 19 July, 4 October, and 15 December 1988; 25 January, 16 and 20 February, 27 July and 21 November 1989.

  (10A) Over the same period, Greer/IGA made payment to Hamilton in the sum of £10,000 as follows:

   (i)   Greer/IGA paid £700 to Tony Sanders Antiques, Penzance, Cornwall, on or about 29 April 1988 for pictures for Hamilton;

   (ii)   Greer/IGA paid £959.85 to John Lewis on or about 9 September 1988, in respect of furniture bought there on or about 7 July 1988 and 12 July 1988 by and for Hamilton and his wife, Christine. On 7July 1988, two tables, a baseweight, parasol and six chairs were purchased; on 12 July 1988, Mrs Hamilton bought and signed a receipt for a further four chairs. Mrs Hamilton arranged delivery of the furniture;

   (iii)   Greer/IGA paid for air fares of Hamilton in the sum of £1,594 at a date between 30.6.88 and 28.4.89, in connection with a trip by Mr. Hamilton and his wife to New Orleans and Aspen, Colorado in the summer of 1988;

  (iv)   Greer/IGA paid Hamilton £6,746.05 by cheque to him dated 13 July 1989.

  (11) Over approximately the same period, Smith received from Al-Fayed personally cash amounting to approximately £6,000.

  (12) The said sums and benefits referred to in Paragraphs 10, 10A and 11 above represented payment for Hamilton's and Smith's services in tabling parliamentary questions and motions and other parliamentary services as particularised herein.

   (12A) In support for the contention that the matters pleaded in Paragraph 10A above represent material benefits in relation to Parliamentary activities carried out in connection with the interests of Al-Fayed and/or IGA, the Defendants rely upon the fact that Greer/IGA made payments to other members of the group referred to in Paragraph 5 above as follows:

   (i)   Greer/IGA made substantial payments to Michael Grylls, made up in part by payments described as `commission':

(a)   £5,750 on 27 March 1987;

(b)   £1,083.33 on 12 September 1988;

(c)   £8,050 on 6 January 1989;

(d)   £5,750 on 1 June 1989;

(e)   £5,750 on 1 July 1989;

(f)   £5,750 on 28 September 1989;

     and in part by payment described as `fees'. According to working papers prepared by IGA's accountants in respect of the year ending 30 June 1990, Greer/IGA's `usual fees' to Mr Grylls were £10,000 per year.


   (ii)   Greer/IGA paid Andrew Bowden £500 in the financial year ended 30 June 1987 and paid a further £5,319.90 by cheque dated 25 June 1987 payable to the `Andrew Bowden Fighting Fund'; and upon the matters pleaded in Paragraph 31 below.

  (13) The Plaintiffs knew of the said payments to Hamilton and Smith by Al-Fayed direct. It is not alleged that they knew in advance that any particular payment was to be made.

  (14) From the 8 to the 14 September 1987 at Hamilton's request and as further consideration for his said services, he and his wife stayed in room 356 at the Ritz Hotel in Paris, the nightly rate for which was approximately £275, and ran up a bill for extras of over £2,000, all at Al-Fayed's expense.

  (15) On the 21 November 1987, Hamilton wrote a letter to the Secretary of State for Trade and Industry, raising concerns about the Department of Trade and Industry's inquiry into House of Fraser and the Fayeds, and about Lonrho and its associates.

  (16) On the 14 December 1987, Smith met the Secretary of State for Trade and Industry with Michael Grylls and Peter Hordern to discuss the said inquiry. Hamilton was due to attend that meeting, and wrote to Al-Fayed to apologise profusely for the fact that he was unable to attend.

  (17) Following a discussion with Al-Fayed, and in consultation with IGA, on the 28 January 1988 Hamilton wrote to the Secretary of State for Trade and Industry, pressing him to take action against Lonhro and Mr Rowland in relation to certain allegedly nefarious dealings in amethysts and emeralds. On the same date, at Al-Fayed's request, Hamilton wrote to Al-Fayed a letter fawning on him and expressing disgust at aspects of the Department of Trade and Industry's inquiry into the House of Fraser and the Fayeds, which he promised to challenge in Parliament in due course.

  (18) On or about the 27 May 1988, Hamilton tabled two written questions to the Chancellor of the Duchy of Lancaster, querying the cost and delay of the said Department of Trade and Industry inquiry. IGA duly reported to Al-Fayed the questions and the answers.

  (19) On or about the 12 July 1988, Hamilton tabled a parliamentary motion condemning the "barrage of libellous and vicious propaganda" issued by Mr Rowland in reference to House of Fraser and Al-Fayed, and requesting the Secretary of State for Trade and Industry to call upon the inspectors to complete their inquiry without delay. IGA duly reported to Al-Fayed on the said motion and the amendments tabled thereto.

  (20) On the 29 July 1988, Hamilton wrote to the Secretary of State for Trade and Industry raising concerns about the conduct of the said inquiry. This letter was part of a planned programme of pressure on the Secretary of State, coordinated between IGA and Al-Fayed and the members of the group of four MP's referred to in (5) above, following the presentation of the DTI inspectors' report to the Secretary of State for Trade and Industry on the 23 July 1988.

  (21) On the 6 December 1988 Hamilton wrote to the Home Secretary complaining about and pressing for action in relation to the leaking of the Department of Trade and Industry report (which was extensively reported in a special mid week issue of The Observer newspaper).

  (22) On the 15 February 1989, Hamilton intervened in Parliament to condemn a journalist and writer (David Leigh) as a propagandist employed by Mr Tiny Rowland.

  (23) On the 12 March 1989, Hamilton wrote a fawning letter to Al-Fayed in relation to his stance in the continuing battle with Mr Rowland.

  (24) On the 21 March 1989, Hamilton the Plaintiff after consultation with IGA wrote letters to the Home Secretary and to the Secretary of State for Defence calling for an urgent investigation into alleged links between associates of Mr Rowland and Lonrho and Colonel Gaddafi and the Libyan regime. Those letters were drafted by Greer/IGA on Hamilton's headed Parliamentary stationery, which had been provided to IGA, and were marked not to be released without the permission of Greer. Lord Trefgarne replied to the Plaintiff on 3 April 1989.88.

  (25) On or about the 29 March 1989, Hamilton agreed with Greer the terms of four parliamentary questions to be tabled by him, which were faxed by Greer to Al-Fayed and sent to Al-Fayed's public relations consultants for use in the press. Greer indicated to Al-Fayed in a fax dated the 29 March 1989 that he believed it would be possible to put more questions down the following week, and that Hamilton could write to the Chairman of the Civil Aviation Authority complaining about facilities afforded to an associate of Mr Rowland. At the beginning of April, four parliamentary questions were tabled by Hamilton relating to Lonrho and its associates.

  (26) On the 7 April 1989, Hamilton the Plaintiff wrote a letter to the Department of Trade and Industry about alleged trading links between Lonrho and the Libyan regime.

  (27) On the 18 April 1989 Hamilton (with others) tabled an Early Day Motion in the House of Commons calling upon Mr Rowland to divest himself of his interest in The Observer.

  (28) On the 3 May 1989, Hamilton tabled an early day motion in the House of Commons calling for an immediate investigation into Lonrho's operations in the light of its and its associates' close links with Colonel Gaddafi and the Libyan regime, having given advance notice of the motion to Greer, who faxed it to Al-Fayed.

  (29) In May and June 1989, Hamilton (with others, including Smith on 2 and 15 May) tabled four further motions in the House of Commons condemning Mr Rowlands' proprietorial interference with The Observer newspaper and calling on him to divest himself of his interest in the newspaper, and accusing Mr Rowland of pressurising The Observer to publish a fabricated story, and criticising Mr Rowland's and the editor of The Observer's (described as "the Lonrho broadsheet") links to the Iranian regime, and accusing Mr Rowland of pressurising The Observer into publishing a false story about Mark Thatcher, and expressing concern at the admitted inability of The Observer to justify its contention that the Sultan of Brunei was involved in Al-Fayed's takeover of Harrods, and calling for the replacement of the independent directors of The Observer.

  (29A) On 6 December 1989 Hamilton wrote to the Home Secretary complaining about and pressing for action against police officers Gooch and Morgan in relation to the leaking of the Department of Trade and Industry report (which had been extensively reported in a special issue of The Observer newspaper dated 30 March 1989).

  (30) On 1 February 1990, IGA rendered to House of Fraser a special invoice (over and above its monthly retainer of £500) for £13,333 plus VAT, specifically to cover disbursements to Members of Parliament including Hamilton and Smith.

  (31) As the Plaintiffs knew, Hamilton and Smith (and Grylls and Bowden) deliberately omitted to declare or register any of the said payments and benefits received from Al-Fayed (directly or by the Plaintiffs). As the Plaintiffs also knew, they were under a duty to do so, by making appropriate entries in the Register of Members' Interests and by making an appropriate declaration in all correspondence and meetings with Ministers or Parliamentary colleagues.

  (i)    The payments and benefits pleaded above amounted to a "pecuniary or other material benefit which a member may receive which might reasonably by thought by others to influence his or her actions, speeches or votes in Parliament or actions taken in his or her capacity as a Member of Parliament" and were manifestly registrable:

  (ii)   The Plaintiffs knew that the payments made and other benefits from Greer/IGA to MPs (including Hamilton, Grylls and Bowden) were not being disclosed or registered. The Register of Members' Interests is and was at all material times readily available to Greer/IGA.

  (iii)    Greer/IGA sought to keep the fact that they made payments to MPs secret from Parliament and the public:

(a)    when interviewed for the purposes of a "TV Eye" programme in or about April 1984, Greer clearly stated that Greer/IGA did not make payments to MPs;

(b)    in his evidence to the Select Committee on Members' Interests on 25 October 1988 Greer stated that IGA was completely dissociated from MPs; when he gave evidence to the same committee on 3 April 1990, Greer claimed that IGA had made commission payments to only three MPs (whom he refused to identify). That statement was false to his knowledge. He did not refer to the full extent of payments to Michael Grylls; to the payments to Andrew Bowden; to payments he now says were made for the benefit of MPs in their constituencies and/or fighting funds in the 1987 and 1992 elections; or to payments made to other MPs including Walter Johnson MP (1984), Michael Brown MP (1988).

(c)    when interviewed by the First Defendant and John Mullin on behalf of the Third Defendant on or about 23 July 1993, Greer denied making payments to MPs. That denial was false to Greer's knowledge. By that time, IGA had also made payments to Lady Olga Maitland, billed and received when she was an MP (1992).

   (iv)   in the premises, Greer/IGA connived with the MP's non-registration of payments or benefits which ought to have been registered.

  (32) Following publication of the words complained of herein, Smith resigned as Parliamentary Under-Secretary of State at the Northern Ireland office on the ground that he had accepted fees from Al-Fayed.

  (33) The Defendants will further rely on Greer's admission in a letter to the Clerk to a Select Committee of the House of Commons (Mr Hastings) dated the 9 May 1990 that IGA had made payments to individual Members of Parliament, on his evidence to that Select Committee on 25 October 1988 and 3 April 1990 and on Greer's admission in 1994 to a reporter from Central Television's Cook Report (who was posing as a potential client of IGA) that IGA could arrange to have a parliamentary question tabled on a client's behalf.

  6. Further or alternatively, the issues in this action cannot be inquired into in this or any Court without infringing parliamentary privilege, and accordingly the Defendants will contend that this action should be stayed.

  7. Further or alternatively, the occasion of publication of the words complained of was an occasion of qualified privilege.

PARTICULARS

  (1) The words complained of were published of elected Members of Parliament (and Ministers of the Crown) in relation to their parliamentary conduct and the discharge of their duties and functions as elected Members of Parliament, and were specifically directed to whether their said conduct was motivated by the interests of their constituents and the public interest generally, or by covert personal financial gain and benefits in kind.

  (2) In the premises, the Defendants had a duty or interest to publish the said words to readers of The Guardian newspaper, and readers had a corresponding interest to receive the same.

  8. Paragraph 5 of the Statement of Claim is denied, and no admissions are made as to the matters alleged in paragraph 6 of the Statement of Claim.

  9. No admissions are made as to any of the facts and matters alleged in paragraph 7 of the Statement of Claim. The claim that damages for libel have been aggravated by a proceeding in Parliament is not justiciable in this or any Court.

  10. Each and every allegation contained in paragraph 8 of the Statement of Claim is denied.

  11. Paragraph 9 of the Statement of Claim is not admitted.

Served etc.

James Price


Re-served etc.

Geoffrey Robertson QC
Heather Rogers

Letter from the Editor of The Guardian to The Rt Hon John Major, PC, Prime Minister, The Rt Hon Tony Blair, PC, Leader of the Opposition, The Rt Hon Paddy Ashdown, PC, Leader of the Liberal Democrats, The Rt Hon Betty Boothroyd, PC, Speaker of the House of Commons

  In the course of the proceedings brought by Neil Hamilton MP against The Guardian we were supplied with copies of a number of documents, including the attached which was disclosed by The Treasury Solicitor.

  I am well aware of the obligation upon The Guardian not to use any of the documents disclosed for any collateral or ulterior purpose nor otherwise to misuse them, and I have no intention of doing so. I do not believe that in sending a copy of it to you I could be regarded as breaching that important rule; on the contrary, for the reasons of clear public interest referred to below, I consider it my duty to bring this document to your attention as the Privy Councillors most able to ensure the integrity of Parliament.

  It is a copy of a minute made by David Willetts MP in 20 October 1994 when he was a senior Government Whip. Although the name of the person referred to as "he" has been defaced, it is reasonable to assume that it was Sir Geoffrey Johnson-Smith, the chairman of the Committee on Members' Interests or, if not him, then another Conservative member in a senior position on that committee.

  The document discloses that:

  (a)   The chairman of the committee (or a senior Conservative on the committee) was in discussion with a senior whip about the handling of the latest allegations (regarding cash for parliamentary questions) against Mr Hamilton which had been made that day in The Guardian; and

  (b)   The whip, known to be a close associate of the Prime Minister, was prepared to consider the deliberate stifling of proper debate and investigation in the committee by "exploiting" the built in majority.

  Moreover, the mention of No. 10 at the outset; the fact that the exchange was recorded in the Government Whips' Book and the timing - the exchange took place at the very time that Mr Hamilton's future as a Government minister was under consideration by the Prime Minister - give rise to the reasonable presumption that the matter under discussion was already, or would shortly become, a matter for discussion between the Chief Whip and Mr Major.

  In fact, of course, the committee did behave exactly as discussed by Mr Willets. On the issue of Mr Hamilton's stay at the Ritz the committee's verdict was settled on the casting vote of the Chairman - precisely in line with the second proposal discussed by Mr Willetts. On the issue of cash for questions for Conservative Majority was exploited in line with the first proposal discussed by Mr Willetts: the matter was set aside on the grounds that it was sub judice.

  It will be remembered that, for the first time since Select Committees were set up in 1979, a Conservative whip, Mr Andrew Mitchell, served on the committee.

  I am sending this letter to each of you with its enclosure because it appears to indicate, at the heart of government, a willingness to subvert for party political purposes the very procedures which are designed to ensure the proper standards of rectitude in public life and which are now to be used in the further investigations into Mr Hamilton. The allegations which would have been aired in the proceedings brought by Hamilton against The Guardian are now to be the subject of investigation by Sir Gordon Downey. However, his powers to call for witnesses and evidence are subject to the decision of the Conservative majority on the Privileges and Standards Committee which he serves; and that majority would be able accordingly to control or at the very least influence to a material degree the scope and rigour of his investigation. Moreover, it is the committee, not Sir Gordon which determines not only the outcome of the inquiry, but also whether the report should be published or kept secret.   Leaving aside the question of what should in due course be done about the state of affairs revealed by the whip's minute, I am sure that you will wish to consider urgently what steps can be taken at this stage to reassure the public that the forthcoming investigation is, and is seen to be, beyond the reach of party political interference. I would respectfully suggest that only an enquiry under the Tribunals and Inquiries Act of 1971 could at this stage rescue the procedure from the grave doubt which must now surround it.

4 October 1996



 
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