Select Committee on Standards and Privileges Minutes of Evidence

Examination of Witness (Questions 100 - 119)



  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 Robinson?
  (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.

Mr Foster

  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 for MPs?
  (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 me—nothing.

  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 of Parliament?
  (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.

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