Select Committee on Standards and Privileges Second Report




Members present:

Mr Tony Newton, in the Chair

Mr D N Campbell-SavoursDame Jill Knight
Mr Quentin DaviesMr John MacGregor
Mr Iain Duncan SmithMr Ernie Ross
Mr John EvansMrs Ann Taylor
Sir Archibald Hamilton

Examination of witness

MR GEORGE GALLOWAY, a Member of the House, sworn and examined.


  1.  Right, thank you very much indeed. You are obviously aware of the background to all this - the complaint that we had from Charles Hendry and the report that the Commissioner initially published which led the Committee to feel that rather more information was needed and that it should conduct further work along those lines. We have had a certain amount of correspondence. You have provided us with some further information but we felt that the stage had been reached where the sensible course would be to talk with you direct about some of the concerns in our minds and the evident deficiencies in some of the paper work that would enable us to be clear about exactly what had occurred. We all hope obviously that tonight's proceedings will enable us to reach some conclusions. I myself am going to concentrate, as on earlier occasions, on chairmanship rather than inquisition.

  (Mr Galloway)   I had a sort of opening statement I had prepared. Would that be helpful?

  2.   I am so sorry, I should have invited you to do that.

  (Mr Galloway)   Forgive me, it is a little formal but it is written. I wish to state at the outset that my work with the Saudi opposition both predates, and has continued beyond, the active life of the CDLR [Committee for the Defence of Legitimate Rights]. I carry out this work because I believe in the cause of elected accountable government on the Arabian peninsula as elsewhere. I received no remuneration whatsoever for this work, nor did I receive any taxable expenses in connection with this work. Thus I was not required to declare any interest in terms of the rules of the House and I did not do so. I am a Middle East specialist with great experience in the area. This was acknowledged by Members on all sides of the House in a debate just a matter of ten days ago. I am experienced enough to know that if I wanted to commercially exploit that expertise I should have taken the side of the feudal Gulf autocracies rather than their opponents. I was asked during an Adjournment Debate early last year if I had an interest to declare due to the presence on the Register of a record of a directorship of a company called Hawk Communications International Limited. In fact this record was out of date and the company, which had never traded, was moribund and had been wound up the year before. Sir Gordon Downey, the Commissioner for Standards, investigated this matter thoroughly in the summer of last year and recommended that the complaint from Charles Hendry, MP, the Vice-Chairman of the Conservative Party, should be rejected. Sir Gordon reached this conclusion after he had gathered the evidence, including what I described at the time as "a so-called transcript" of a tape recorded interview between an unknown journalist falsely claiming to represent The Sunday Times and Messrs Al Mass'ari and Al Fagih. It now turns out from the official transcript made by the Committee's own sources that the so-called transcript had been doctored in a way which would have made the late Richard Nixon blanch. This transcript reveals not only quite a different story to that which was offered by the journalist but turns out:- 1) to have been drawn from a tape which is, in fact, a compilation of several different tapes; 2) to be replete with obvious joins and cuts; 3) in which, according to your sources, and I quote "sometimes the recording has been faded out" intentionally; and 4) in which the questions and answers of a woman "have been largely removed". The Committee will draw its own conclusions as to why the journalist concerned sought to mislead the Committee by cutting, joining and otherwise distorting these conversations in this way. My conclusion is, as it has been from the beginning, that this is a dirty tricks operation in which the Committee has been unwittingly embroiled resulting from my successful campaign to highlight the nature of the Saudi regime and their pressure on the British government to deport leaders of the Saudi opposition in London. I have to ask the Committee if they can justify continuing this inquiry when the sole "evidence" turns out to be a tape-recording which your sources now confirm to have been doctored. It is surely significant that despite this evidence having been trawled through Fleet Street not a single newspaper thought it credible enough to publish the allegations in any form. If the Committee insists on continuing this inquiry, I am bound to make the following necessarily detailed observations. 1) Al Mass'ari freely acknowledges no less than 18 times in the transcript that Dr Saad Al-Fagih was in sole charge of the organisation's financial affairs. 2) Al Mass'ari at no time asserts that he ever gave me any money. The Committee has a copy of Mass'ari's letter of 16th October 1996 to my lawyer in which, inter alia, he states: "During all of that period George Galloway worked with me as an individual not as a representative of any company", and, "Neither I nor CDLR had any financial relationship with Mr Galloway", and, "Neither Mr Galloway nor I obtained any financial benefit from each other". 3) Al-Fagih in his letter to the Commissioner and in the official transcript makes clear the exact circumstances of any transactions there were between him and I. 4) Thus there is nowhere in any of this anything in which any of the parties allege that they made any payment to me which could be held by you to be improper. 5) As is evident from the transcript, Al Mass'ari was the political head of the organisation and had little to do with logistics or the day-to-day running of the CDLR which was left entirely in the hands of Al-Fagih. Thus he does not know whether I sent out "hundreds", "thousands", "15,000", or " 1,000 - 1,300" copies of my letter to British businesses, think-tanks, etcetera. In fact, the numbers of envelopes which were stuffed, sealed and posted in my presence totalled no more than 300 on two separate occasions. The envelopes contained a letter from me on House of Commons notepaper advancing my view that public policy in the United Kingdom towards Saudi Arabia was wrong and should be changed and drew attention to a report which was enclosed, produced by British academics which buttressed my view. For the same reasons Al Mass'ari, as shown in the transcript, thinks that the cost of the conference in the House of Commons was "a minimal amount, some hundreds" page 7, line 11, whereas in fact the cost, as can be confirmed by the House of Commons Banqueting Department, was £2,023.58. 6) Al Mass'ari's references to money and costs are many and will be to the Committee confusing. As I have stated from the beginning, I was putting them in touch with professionals and others who were providing services for them and who were paid, usually directly, by Dr Al-Fagih or in the case of some of the academics by me with his money. These ranged from academics producing reports and analyses through to security experts, who regularly swept their headquarters, all the way to printers and T-shirt makers. Thus Dr Al-Fagih did indeed expend significant sums on work with which I was associated but these were paid not to me but to those doing the work. 7) As can be seen in the official transcript, although not the journalist's one, Al Mass'ari makes clear that there is no question of me receiving money from them for the work I did in Parliament. Indeed, Al Mass'ari makes clear that Al Fagih would have looked askance at the very suggestion. He would, said Al Mass'ari, "be repelled" page 14, line 17, at any such suggestion. Al Fagih he says, "is very tight with money", "suspicious", and Al Fagih "thinks others should work for him free", "he is very tight." "If George ever said I am doing all these services and you should take that into consideration - then for Saad this immediately would have been a very [?bad thing]", Al Mass'ari says in the transcript. In conclusion, Dr Al-Fagih had full control of the CDLR's purse strings. We have Al Mass'ari's word that Al-Fagih is tight with money, thinks everyone should work for free would have been suspicious and repelled if he had been asked by me for payment for any work done by me. More importantly, you have Al-Fagih's word directly that he gave me no remuneration or expenses within the meaning of the Inland Revenue's regulations and the rules of the House and you have my word as a Member of Parliament for ten years on oath that he did not do so. Against that you have the word of an unknown journalist who lied about his provenance and who unsuccessfully peddled his story in Fleet Street. Alas, he was rather more successful in peddling to Mr Charles Hendry, MP, doctored and misleading tape recordings.

Chairman:  Thank you very much indeed. That is a fairly comprehensive statement of the position as you see it. Can I now bring in Ann.

Mrs Taylor

  3.  I think the one thing we are all agreed with you on is that some of this evidence is extremely confusing and I think members of the Committee have spent some time trying to find their way through things and see what is happening. You mentioned right at the beginning that you felt there was no remuneration or taxable expenditure which had come to you which therefore required declaration. Are you absolutely sure in your own mind that you were clear during that debate on exactly what the rules of the House were relating to anything that was being received currently or indeed had been received in the past?

  (Mr Galloway)  I was clear and if I had not been I would have made a declaration. The Adjournment Debate was an important occasion in which there was a lot of public interest. I was aware that there was record in the Register of a previous directorship of a company which had by then become defunct. So clearly if I had thought there were any interests to declare I would have done so. Indeed, these were exactly the words I said in response to Mr Hendry when he arose on a point of order. Subsequently in conversations with Sir Gordon Downey and his subsequent consultations with the Inland Revenue, it became clear that my interpretation was the correct one, namely that the reimbursement of monies expended on political action does not constitute expenses in the terms of Inland Revenue's regulations or the rules of the House.

  4.  Were you surprised when the point was made during the debate when you were challenged?

  (Mr Galloway)  Candidly, I was not because from the December previously I had been aware of an attempt made by, I cannot say exactly who, but by people who were supportive of the Saudi regime to raise this issue of my motivation or my motives in being involved in this campaign. The now British Ambassador to Saudi Arabia, then a very senior official in the Foreign Office, told a Guardian journalist at the Foreign Office Christmas party that he felt I must be being paid by the Saudi opposition for the work that I was doing. A Saudi press attaché told another journalist on another newspaper who reported to me that he felt the very successful efforts he acknowledged I was making were almost certainly being paid for. When I saw the unlikely figure, for he is not a well-known figure on foreign affairs, of Mr Charles Hendry bobbing up and down trying to intervene on me I had some suspicion that a question such as that was going to be bowled. So when I heard it I was not particularly surprised but I did respond in forthright terms very unequivocally which I do again now.

  5.  Have you ever visited Saudi Arabia?

  (Mr Galloway)  Yes.

  6.  How long ago was that?

  (Mr Galloway)  In 1989 I was part of a British Parliamentary delegation that went to Saudi Arabia led by the now Lord Pym. Indeed I think he probably was then the Lord Pym. It included such luminaries as the now government Chief Whip and Mr Andrew Faulds. I was a very junior member of the delegation.

  7.  Was that the only time?

  (Mr Galloway)  That was the only time.

  8.  That would not constitute a registerable interest at the time of the debate?

  (Mr Galloway)  No.

  9.  I think there is some surprise and puzzlement, I think is the right word, about the exact structure of the company that you established, Hawk Communication, what its role was intended to be, how it was structured, whether it had accounts, whether it actually operated because you registered it in the Members' Interest Register published in January 1994 and then again in January 1995 and I think we are a bit surprised that it had two entries and yet nothing ever happened in respect of that organisation. Can you clarify how that company came to be established, whether it was actually operational, who was involved and give us more details on that.

Mr Evans:  Could I add to that, George, why was this company established?

  (Mr Galloway)  The company was established to, as we put it at the time and I think I have in correspondence with the Chairman, to give a professional edge to radical campaigns. In particular, it intended to centre its work around the then emerging Palestinian entity, the Palestine National Authority for a lot of reasons. Two of the parties to the company, Amineh Abu-Zayyad, a scientist from Glasgow, who has been my partner since 1991, is Palestinian, and another, Basem Masri, who is currently Serjeant-at-Arms, you might say, in the Palestinian parliament in Gaza is also himself a Palestinian. Insofar as I am identified with any one area in foreign policy, it would be with the Palestinian question going back 25 years perhaps, almost 25 years anyway. We saw a number of important opportunities there for intervening in a positive way. I said in previous correspondence, for example, that we applied to the Westminster Foundation for Democracy to translate into Arabic Walter Citrine's A B C of Chairmanship which we felt would be helpful to the emerging organisations in the Palestinian territories. We hoped to encourage British Muslims to travel, perhaps invest but certainly to go as tourists and as religious pilgrims, to Jerusalem and to visit the Palestinian authority. We hoped to establish a newspaper or magazine in English in the occupied territories. We had all sorts of plans for the Palestinian arena, none of which came to anything. I am asked about the structure, Chairman. It had nothing so grand as a structure. It was a very flat structure in that sense therefore. Its Secretary was a lawyer, David Freeman. He was then of David Freeman & Co. He is now of Oswald Hickson Collier. He was the Company Secretary and the registered office of the company was at his address first on the Embankment and later in the City when his company merged. It had no office and no staff, and it raised its initial capital from the members of the company, most of which was expended on a single trip to Palestine and on a very large stock of stationery and envelopes and compliment slips but it was turned down by the Westminster Foundation for Democracy and it quickly became clear that the Palestinian National Authority was very embryonic indeed and any work done with them would almost certainly not be paid for and at the very least would be paid for very late and interest in that field quickly cooled. I am asked why it was registered twice? Because the company still existed it was registered twice. It had not been wound up and it would clearly have been improper not to register if I was a registerable shareholder in it and a director of it.

Mrs Taylor

  10.  Was it the intention when you formed the company to make profit out of that kind of work?

  (Mr Galloway)  It was certainly to be commercial. There was never any discussion as to how profits would be distributed. I am not one of those who thinks that profit is a dirty word. I may be old Labour but not that old! I dare say if it had been a success and had been profitable ultimately the directors would have drawn some remuneration from it but because it never earned a single penny the question was largely academic.

  11.  How many bank accounts?

  (Mr Galloway)  Just one with the National Westminster and I have provided the bank statements.

  12.  Who were the signatories on the cheques?

  (Mr Galloway)  I think myself and Mr Basem Masri.

  13.  Thank you. Finally, turning to the CDLR, can you explain your relationship with them both in terms of you personally and in terms of any direct connection with Hawk Communications so we can be clear on that score.

  (Mr Galloway)  My connection to them in a sense was obvious because I had already been active on the issue of the lack of democracy in Saudi Arabia before they ever arrived in this country. That is why I said in my opening statement my involvement predates and postdates the active life of CDLR. I had been active on the issue of Saudi Arabia since the time of Gulf War. I had formed a very poor impression of Saudi Arabia on my visit in 1989 but I had largely, because of my close involvement with the Palestinian issue, frankly chosen to overlook the ugliness of that regime because the Palestinians needed them and as I was very closely associated with the PLO me being involved in overtly anti-Saudi agitation would have been difficult for them and would have compromised them. In the end it did anyway and I was asked by senior Palestinian politicians to stop my agitation but I formed the view around the time of the Gulf War that this ugliness could not be overlooked and after Oslo I took the view that I should strike out and follow my conscience on the matter so when the CDLR representatives arrived here as refugees in London they had been appraised, I later learned, of my salience, if you like, on Middle Eastern issues and my likely sympathy with their cause. They were associated with the best-selling author and Daily Telegraph journalist Said Abu-Rish who had written the seminal work on the Saudi regime called, The Rise, Corruption and Coming Fall of the House of Saud which is a best seller across the world. He is a relative, he is the uncle of my partner, my woman partner I should say, my woman and business partner in the case of Hawk. I mean Amineh Abu-Zayyad for the avoidance of doubt. He provided the introduction and I got on with them very well and as soon as I met them was pleased to highlight the demands that they were making and pleased to be involved in political activity with them. As Hawk never traded, was moribund and then wound up it follows that the CDLR had no relationship with Hawk. Their relationship was with me and that is attested to in the transcript and in the letter which Al Fagih sent to the Chairman and to the Committee and is also stated by Al Mass'ari in his letter to my lawyer of October.

Mrs Taylor:  I think in terms of setting the scene and setting out the basics, that is as far as I want to go at this stage.


  14.  Before I bring in Archie Hamilton, could I ask one question myself which puzzles me really or rather the possible answer to it puzzles me. At the time this debate took place that led to this complaint in January 1996 there is no doubt I think that the extant register which had not been amended had two entries, one under remunerated directorships which referred to Hawk Communications International Ltd, "a communications company recently established to assist democratic development in the Middle East and the Indian Sub-Continent" and then also a registerable shareholding in Hawk Communications International. On the face of it, it was not unreasonable for anybody checking the Register to wonder whether some declaration in this respect ought not to have been made. What puzzles me is why you did not explain at least briefly some of the points you have put to us about the fact that the relationship was with you personally not with Hawk and in any case that Hawk had either ceased to exist or never really existed instead of dismissing the suggestion that a declaration should have been made.

  (Mr Galloway)  It would have disrupted my speech which was the reason that the intervention had been made in the first place. The Member concerned rose several times and I did not give way so he rose on a point of order. As you know, in an Adjournment Debate you have exactly 15 minutes to put your point. I, unusually for me, produced a written speech which I read to the House into the record and so I had exactly 15 minutes' worth of material. If I had done as you just asked, Chairman, if I had diverted down that pathway, it would have taken a good two or three minutes from my speech and important points would not have been able to be made. In any case, I take the view maybe I am unusual in this, that if a Member has something to declare they will declare it and if someone thinks that they ought to have and they did not there are procedures for making enquiries and complaints about that after the fact. So I saw the intervention as a deliberately disruptive one and that is why I did not take time to deal with it.

Sir Archie Hamilton

  15.  But it did read as a remunerated directorship so you were being remunerated?

  (Mr Galloway)  No I was not but I had sought advice from the Clerks to the Committee at that time and the rules were then, as they still are now, that if there is ever a possibility that you may be remunerated then it must be recorded as a remunerated directorship. So I never received my remunerations, quite the contrary.

  16.  You have said on a number of occasions that Hawk never traded but money did actually go in and out of the bank accounts.

  (Mr Galloway)  No, the only money that went into its bank account was the original capital from the shareholders, £1,000 each and payments for a mobile telephone which one of the directors, Basem Masri had use of. That is the only income that ever went into the bank account as the statements show.

  17.  I thought you said it paid for a trip to Palestine?

  (Mr Galloway)  That was money going out from the account.

  18.  Effectively trading?

  (Mr Galloway)  No. Companies House said in answer to Sir Gordon Downey that it accepted that the company had never traded.

  19.  How long have you known Mr Al Mass'ari?

  (Mr Galloway)  I think the beginning of 1995. It may have been the last month of 1994 around that time, around the autumn/winter of 1994/95 not long after he arrived here.

  20.  Do you work with him now?

  (Mr Galloway)  I do not work with him now although I am still in contact with him. One of the reasons I do not work with him now is he himself is not working now. As you may have gathered from the public press he has run into rather a lot of personal difficulties. He is being investigated by the Child Support Agency and has all sorts of personal difficulties but I also have some political problems with him. I did have cause to publicly disassociate myself from him in the pages of the Jewish Chronicle over his reported comments which I accept from him were distorted but nonetheless even his version of them were comments that I could not be associated with. So there is some political distance between himself and myself nowadays. He has taken a turn on Islamic matters which is certainly not to my liking.

  21.  Why do you think he said in this transcript that you were being paid this money on a monthly basis? What was going through his mind when he said that?

  (Mr Galloway)  I think the first thing I have to say is I am not sure that is the context in which he said it. None of us can be sure exactly. I spent the last few months having only the transcript that was submitted by the journalist asking myself that very question but when I read the actual transcript there is a lot more context and a lot more confusion in the full transcript than was in the journalist's transcript so I do not know if this transcript, given that it is a compilation of several tape recordings with all sorts of chicanery involved with tapes been joined and cut and faded out intentionally and questions being removed and answers being removed, I do not quite know what he did say, but if we deal at face value with the points that he makes on that, which I acknowledge are to say the least confusing, he is confusing the amount of money that was being spent by the organisation on work with which I was associated and he himself says that - I have got them marked several times in the transcript - that this money was being spent but it was being spent on secretaries, on bodyguards, on lunches, meetings, T-shirts and all these kinds of things. In one and the same transcript he seems to indicate that there is a regular amount but at the same time in the same transcript he is indicating that these expenditures were on costs, which is a word he keeps using, which were incurred in the cause of the campaigning. The most important point, as I sought to make clear in my opening statement, is he had nothing whatsoever to do with money. He never parted at any time with a brass farthing to me and he has no idea about money or numbers. Thus, the same man in two paragraphs can say that I used hundreds of House of Commons envelopes and 15,000 House of Commons envelopes. The same man can say that the cost of a conference in the House of Commons was very limited, a few hundreds, when in fact the cost was over £2,000. This was a man who had nothing to do with the logistics of the organisation, as he makes clear, as I said in my opening statement, no less than 18 times in the course of this full transcript, no less than 18 times he says that the finances of the organisation, the payments for things were made by Dr Saad Al Fagih. Now, you have a statement from Al Fagih explaining exactly the nature of any transactions between him and me and you have my word for it here.

  22.  Where did Al Fagih's money come from then in rough terms?

  (Mr Galloway)  Wouldn't you like to know.

  23.  I am not asking precisely who paid up, but was this people in Saudi Arabia or around the Middle East?

  (Mr Galloway)  Well, there is a big question mark over that question and even if I knew, I would not state it in public, but, as it happens, I do not know. His was a revolutionary organisation which was receiving support, they said, from well-wishers in Saudi Arabia. There have been all sorts of theories. One salient theory is that one section of the regime in Saudi Arabia, that section around the Crown Prince Abdullah who is involved in a power struggle with his half-brothers, was the source, is the source of money not just to him, but to other Saudi opposition groups. I had no way of knowing the actual truth of that, but it was very substantial. Their telephone bill in 1996 was almost three-quarters of a million pounds for telephone and fax calls because every night they sent 800, 1,000, 1,200 faxes to Saudi Arabia which were then photocopied and distributed as leaflets. It is the only way you can convey a political message in Saudi Arabia, so they were at one time in receipt of very substantial funds obviously and BT were paid.

  24.  But at the same time, Dr Al Fagih was very mean in terms of the money he gave to anybody else?

  (Mr Galloway)  Well, there is no contradiction in that.

  25.  The sort of money we are talking about here?

  (Mr Galloway)  Al Fagih husbanded the organisation's resources very tightly and that was his role and was presumably why he had been given that job.

  26.  You have got here some of the expenses which you paid out in 1995 and 1996. Most of these seem to be airline tickets. Is that right?

  (Mr Galloway)  I do not know that most of them are. If you like, I will turn them up.

  27.  British Airways, Open Flight Limited.

  (Mr Galloway)  I do not think in monetary terms it qualifies as most of them.

Sir Archibald Hamilton:  Well, most of the money seems to be there.

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Prepared 28 July 1997