Examination of Witness (Questions 100
TUESDAY 18 MAY 1999
100. Can I turn to the other article. The
first part of the next article by the Evening Standard
is headed "22 December 1998".
(Mr Mandelson) Yes, I have got that.
101. I will not read out the first paragraph.
The second one says he says "the house had been bought with
money from the sale of his previous shared flat in Clerkenwell
and with funds from legacies that were coming through his mother".
(Mr Mandelson) "He made no mention of the
.... loan from Geoffrey Robinson..." Absolutely right, I
did not make any mention of it at all to him and nor would I,
it was none of his business.
102. So it was established that over half
the cost of buying the house and doing it up had come from Geoffrey
(Mr Mandelson) This article was written after
the revelation about it.
103. I think the previous explanation that
the Evening Standard believed they had in June 1997 when
they wrote the profile made no reference to the fact that over
half of the cost of the house had come not from legacies, not
from a mortgage, but from a friend.
(Mr Mandelson) I cannot remember who questioned
me in relation to the original article or when it happened. I
have no recollection at all. I can safely assume that I would
have been evasive. I regarded it as none of their business. I
found it incredibly intrusive the entire time and it was not just
then. I would have actively evaded and side stepped all their
questions and I put my hands up to that. I cannot give you an
account of what took place between myself and that journalist
on that occasion. I do not remember the exchange. I do not believe
that I was interviewed. At the time I had many conversations with
journalists, thankfully those have now stopped apart from the
Daily Mail people. I did not see any need to rehearse every
aspect and fact about my private life and my personal arrangements
for these journalists, I had had it up to there, I was not going
to have any more of it.
104. You were not going to tell them that
over half the cost had come from a loan that nobody knew about?
(Mr Mandelson) I am sorry?
105. You were not going to tell them that
over half the cost had come from a loan that nobody knew about?
(Mr Mandelson) I do not believe that there was
any public interest justification for their asking that question
or for my telling them how I financed my home arrangements, unless
of course I am doing something which is unlawful, illegal or hypocritical.
106. So it was a different reason for not
telling the Britannia Building Society?
(Mr Mandelson) I was under no obligation to tell
the Britannia Building Society in my view. If you go back to the
original question D5. At the time of my filling out that application
form I had no agreed loan from Geoffrey Robinson. I did not have
it, it did not exist at that stage. If I had realised that there
was an obligation on me subsequently to tell the Britannia that
I had a loan from Geoffrey Robinson, if I had realised that, I
would have told them. I did not realise there was any obligation
on me to do so. I was never advised by any adviser that I needed
to tell the Britannia that it had been Geoffrey rather than my
mother who had financed the purchase of my home, but I have acknowledged
that it was an oversight by myself and my solicitors. I did that
straightaway and I have apologised for it. The only thing I would
say, though, is that as they themselves, as the Britannia themselves
have acknowledged, and Herbert Smith have acknowledged, it made
no material or financial difference to the building society who
financed the balance, the remainder of the purchase price, because
it did not represent a charge upon the property.
107. So is "security" and "charge"
the same in your mind?
(Mr Mandelson) It is an entirely unsecured loan
and the reason why the building society have taken such a firm
and clear position on this all this year is because, as Herbert
Smith said on their behalf to the Commissioner when they wrote
in April: "Not only was there no dishonest intent on behalf
of Mr Mandelson, there was never any financial risk to the Society
at any time ... The Society has always been fully secured ...
The Society's normal lending criteria and procedures were followed
at all times .... " That is what the building society believe;
that is what Herbert Smith have said on their behalf, and I think
that is very, very relevant indeed.
108. Does "security" and "charge"
mean the same in your mind?
(Mr Mandelson) Yes.
109. You do not think "security"
means "obligation" or "commitment"?
(Mr Mandelson) No, it does not. A loan is either
secured or it is unsecured. It cannot be both; it is either. I
know all about this now.
110. May I ask you why you went to Britannia,
who introduced you or what was the basis of your going to them
as opposed to some other society?
(Mr Mandelson) My research assistant advised me
to do so because he looked up in the newspaper who were offering
the best deal and he said Britannia. I had never walked into a
Britannia Building Society branch before in my life. I had always
been with the Abbey National previously.
111. They were not offering special deals
(Mr Mandelson) Absolutely not, and I think it
is a very pertinent question given the nature of the complaint
that has been made about me and the conclusion that the Commissioner
has reached. I think it is illogical and absurd to suggest that
the Britannia Building Society should have offered me any sort
of favourable treatment or concessionary loan. They had treated
me throughout as they would any other member of the public and
there is no evidence at all, and certainly no logic, to believe
that they should treat me in a special way because I am a Member
of Parliament, and they have not.
112. When you went in, you told them how
much you needed£150,000?
(Mr Mandelson) I did not say that, no.
113. How much did you tell them you needed
and how did that come about?
(Mr Mandelson) My recollection is I did not say,
"I need £100 or £150,000." I think I was eager
to borrow however much they were prepared to lend me and I think
on my salary they said they computed it at £150,000.
114. What I really wanted to ask you was,
what then went on in the discussion about how the balance was
to be supplied? Did it become an issue in that interview at all?
(Mr Mandelson) It never became an issue at all.
I was never pressed for information about it. There was no enquiry
about my mother's resources or her ability to help menothing.
115. When you say there was no enquiry,
did you volunteer that it was coming from your mother or was it
just not mentioned?
(Mr Mandelson) Yes, I said I did not say
my mother, I said from my family, but I did not go I was
very imprecise about it, (a) because I did not think I needed
to be more precise, and secondly, they never asked me any questions
about it. There was never any substantive discussion about this
throughout the entire time I was with the Britannia.
116. You say as you went through the form,
were you looking at what was being written down or had part of
it been completed before you entered the room or how did it come
about? Can you talk us through that?
(Mr Mandelson) He was in front of It was
a very small room. It was like an interview cubicle. He was one
side of the table, I was the other. He had the form, he read out
the questions to me, he filled in the answers and that was it.
117. For example, when you got to the point
of employment, he may have just been prophetic but when he refers
to you as a minister, how did that get filled in in that way?
(Mr Mandelson) I did not tell him I was a minister.
118. So did you tell him you were a Member
(Mr Mandelson) Yes, I did. I think he knew.
119. That is the point. If he knew, did
you leave him to fill some of the bits in or did you give him
an answer to every question?
(Mr Mandelson) No, I answered every question he
put to me.