Annex 2
Notes by Mr Dean Nelson of his conversations
in January 2000 with a number of Labour Party staff and others
There was no money from the Labour Party after that
time.
He was cutting the newspapers in the morning. Came
in at 8 am, cut the newspapers and photocopied them. Started on
an ad-hoc basis, but he was around for the rest of the day, answering
the phones. He was very eager to learn and help.
I think his Dad said I will help you out. You can
have my boy and I will pay for him. John Reid said I want to help
and be a part of this outfit. This was in April 98. I`m pretty
certain. Reid was hanging around at the weekend strategy meetings,
brought in by Number Ten to keep an eye on Gordon Brown. He didn`t
do very much. After two or three weeks I was beginning to report
to these meetings that while they were sitting around talking,
there`s only me here. He (Reid) said my boy`s not doing anything,
he can come in and I will find a way of paying him. I think he
would have come in, might have been end of April. The impression
I had was that it was voluntary. It was the sort of thing which
traditionally went on for a long time.
Everyone in the office was working full time. The
strategy meeting was on the top floor of Keir Hardie House on
a Sunday morning. Donald Dewar, Brian Wilson, Alex Rowley had
just started. I don`t know if Gordon was there, I think he was.
Gordon Brown, Donald Dewar, John Reid in the corner with the ashtray,
Brian Wilson.
John Reid paid Kevin Reid. He was on the books of
the Labour Party but you would have to look elsewhere for the
point at which he was put on the books of the Labour Party. You`re
not a hundred miles off. It`s good information. Your source is
spot on. You could also look at arrangements for Chris Winslow.
When they left the employment of the Labour Party, the position
had been corrected. It was me that changed the arrangements. If
you`re being paid out of Westminster or through an MP ... Willie
has left the party, he`s working for Nigel Griffiths. MPs` staff
get paid through the parliamentary office. I would imagine at
some point these must have been on the books. There was a point
at which there was a story either in the Sunday Times, The Times
or maybe the Financial Times. It was an attack on the Tories doing
this kind of thing. People started to panic because when you looked
at the Scottish Labour Party, we were carrying out a similar practice.
After that I put it right by putting people on the books. It was
obvious that the Kevin and John thing could be linked. They were
not declared as we had people being paid part time by the MPs,
and part time by the party, doing a full time job. Practices like
that going on which were clearly breaking the rules. There were
lots of things happening in terms of budgets at that time. Times
when people pointed the finger at me during the election. But
I complained that I had no staff. I had to do deals to get people
into the office. Margaret McDonagh came in and kicked me around
the room and said we would not get any more. The finance of the
election campaign is wide open if people look at it. There were
a few at different times. If I`m employed by an MP to work for
that employer but I`m not working for them but for the Labour
Party, that MP is breaking the law. That MP is using public money
to pay for a researcher but really financing the Labour Party.
That person is breaking the law, deceiving as an MP. In terms
of declaring stuff, a hell of a lot of things ... The spending
was much higher than what was shown.
The resources: They changed in the SLP when John
Rafferty came in. He made it absolutely clear that the condition
he was coming in on was that there would be resources. Resources
followed his appointment. Up to that point we were really struggling.
I was going cap in hand to London. The election commission was
a voluntary thing. It said we would not spend more than 1.5 million.
I think we did. It said we would declare all donations over 5,000
at a Scottish level and all over 1,000 at a constituency level.
Also, for example, if Matt Smith said you could have
two members of staff for a month, we would have to declare that
because it is a donation in kind to the value of ...
Suzanne Hilliard got Chris Winslow`s money from Maxton
when he was put on the payroll. (She told me. I had asked her
if she would like to be the Govan organiser, but she said no because
she was getting Maxton`s money. She carried on working for the
election campaign. Under the Scottish Parliament (Election etc)
Order 1999, returns made by parties` nominating officers. Labour`s
Lesley Quinn stated that "The total amount of payments set
out in this statement amounts to 940,118.18 .... Salaries and
expenses of staffing and volunteers 16th March-6th May 1999: 186,514.
Statement based on a submission by Labour`s assistant
General Secretary in Millbank, David Pitt-Watson. Labour spending
included £65K rent on Delta House and £23,000 refurbishment
costs, but systematically omitted details of donations in kind.
Suzanne Hilliard: Her pass was ready for collection
in July 99. It was requested but never used.
A pass was issued to Mark Reid in the name of John
Reid issued in January 98 and expired in January 99. Nil return
on whether Mark had other employment. A pass was issued to Kevin
Reid in 1996 and expired in June 1997.
After Lobbygate broke, Winslow came to me, ashen
faced one morning. He said there`s something you don`t know about
and that was Kevin Reid was employed out of his father`s parliamentary
allowance. That was one of things I came to see you about. I was
trying to find out what you knew. I had a long conversation with
Donald Dewar about this. He immediately grasped the gravity of
it. He did nothing. I was told to forget it and go around everybody
who knew about it and tell them to forget it as well. I knew.
I didn`t check what Chris was saying. It was terrifying because
we could have been looking at doing the election again. I don`t
think a court would rule in that way, but you see Dean in the
middle of Lobbygate, masses of publicity, had the House of Commons
Standards Commissioner started investigating this ... it would
have been enormously damaging. (Chris) was very worried. He thought
if you discovered this about Kevin, you would discover this about
him. Alec dealt with all of that (deals to get the campaign going).
I had no idea who was on the payroll and who wasn`t. ... Had I
known about this I would have stopped it.
I probably would have had to do more than stop it.
I would have had to take advice. ..I couldn`t be there directing
the general election campaign knowing the law was being broken
and not do something about it.
Q: Kevin was working full time for the Labour Party
Absolutely. From 4 in the morning
What time did he finish?
Two o`clock.
"I have no knowledge of this. All staffing matters
were dealt with by the Labour Party."
I was obviously concerned. It (this article) was
shown to me. It was me that was concerned.
How quickly did you move after that to make him full
time? Was it immediately?
Yeah. It wasn`t a big deal. I couldn`t see how anyone
could find out about this. But if they were
panicking ... and telling people, then it`s their
own fault.
When you saw this article, did you need to check
to see if they were being employed, or did you
know?
I`m not keen to discuss it Dean. I cannot give you
your research on this, you`ll have to get it elsewhere. I`ve gone
pretty far on it as it is. The more I get into discussion with
you the more I`m giving you the whole story and I don`t want to
do that ... At the end of the day I don`t know who your source
is for this story, I don`t want to know, I`m pretty baffled that
it came out because there were only a very few people who knew,
who was employed and how they were employed in the party at that
time. But if they`ve panicked then that`s their fault. But as
soon as you run that story I can narrow it down to three people.
You could come at this from the angle and slate me as well because
I`m the guy who was in charge of all this.
What was your answer?
At that time I just did not have resources, —
— —
So Reid and Maxton came and offered?
I don`t know how these things happened. These are
the practices that worked previously when Jack was there. It was
not knew but I cannot remember exactly how it came about. ...
At the end of the day the person who agreed it and sanctioned
it was me. I`ll not try to put the blame on anybody else. If a
member of staff comes to me and says here`s an opportunity to
have more staff, its my responsibility to say yes or no.
When you said yes or no at the time did you know
it was a dodgy set up?
I wouldn`t think that I realised how serious it was
until I read that article and thought if that lot can get into
trouble for it, so can we. Even when I saw the article, I didn`t
stop the whole practice, I still had people in there who continued
on that basis. What I did was to take what I thought was politically
sensitive persons away from it.
Why was Winslow sensitive? I can understand why Reid
was, but why Winslow?
Well, I don`t think I did take him off. What I think
I did there was give him a wage increase. Because what I discovered
by taking Kevin off was that the rates were different, so I increased
the money that the party was paying him, but he continued to be
paid through the other way.
But Kevin stopped being paid by John?
Kevin was on the books, totally, full-time yeah.
Did you talk to Kevin about the sensitivity?
We`re getting back to me giving you the story Dean.
Obviously I must have explained to people that I was changing
their contracts of employment....
The question you have to ask is did someone else
continue to get paid by him after that. Did the money get switched
to someone other than Kevin?
Aye.
I`ve no doubt that John`s commitment was to the campaign
and that it was a matter of taking the Reid name out of it, not
giving up the cash which you needed.
Yeah. That is about right.
Is there a name?
I`m not your source. I`m far too heavily implicated
in this. I was in charge of the party in Scotland, so I had to
know these practices were going on. The fact that you`ve got this
story, I`m implicated and I`m not going to run away from that.
I`m not the kind of person who tries to blame anybody else. I
was in charge at that time, I knew these practices were going
on at that time. I`m not asking you to do me any favours. If you
lie with the crows you get shot with the crows.
the argument being developed is that many contracts
with the MPS were part time contracts and the contracts with the
Labour Party were full time.
How does that work as an argument.
I don`t think it does if you look at Kevin Reid`s
hours. And the question is were they properly entered into the
election return.
The statutory order one?
Yes.
I don`t understand this defence of Labour`s contracts
being full time and the MPs` contracts being part-time. The only
question is whether they overlap or not.
Well, they do overlap. That`s the point.
"I`m no longer an employee of the Labour Party.
During the time I was, employees and their contracts are private.
Relations between employees and employers are private matters
and I don`t want to discuss it."
Lesley Quinn said don`t allow yourself to be dragged
into it. I said by implication the finger can be pointed at me.
She said don`t allow them to blame you.
DN: If he sues we`ll subpoena you then you can say
you hadn`t volunteered.
Aye, I agree. Subpoena under oath. The one thing
I`m not going to do is lie for anybody.
That`s the reason I know about any switch. She (Suzanne
Hilliard) openly said she`d been taken on with Maxton`s money
... I knew about them, I didn`t know about Kevin. No-one seemed
that concerned about it from the Maxton side. The people that
were getting employed were talking about where their wages came
from. I was looking for an organiser for Govan. It was difficult
to get someone, Suzanne was a volunteer and I asked if she`d consider
going for the job. She said no because she was going to get paid
by Maxton.... Kevin was always being paid. His brother was a volunteer.
Kevin worked at Westminster for Frank Roy and John Reid.
When you joined in July 98 was Kevin Reid working
full time?
He was, aye. He was certainly in the Scottish Labour
Party headquarters full time. He was always doing monitoring ....
you assumed nobody had an outside job, because they were all there
doing a job, a full time job.
They`re saying he only did 15 hours a week? Three
hours a day?
What I do know is that he started really early to
get the breaking stories in the morning, it was to get the six
o`clocks, he finished round about lunchtime. At that point he
was just doing Monday to Friday. It wasn`t until the campaign
that it became 24 hours a day.
Q: As far as you were concerned he was doing a fulltime
job at that point? That`s what others are saying.
What`s your recollection?
I cannot be your source.
Q: I`ve got other people saying he was full-time.
I would not disagree with that. If you had me in
court under oath, I would have to say he was working until at
least lunchtime .... Whenever I came in early, he was always there.
The media monitoring didn`t really get off the ground until we
moved to Delta House.
If you were under oath you would say he was working
full time? If I was under oath I would have to tell the truth.
And that`s what it would be?
Yeah.
When you put Kevin Reid on the books full-time, did
you let John Reid know you were doing that?
Yeah.
And you let him know why you were doing it?
I would have explained why I was doing it, yeah.
So. he would not have made these arrangements in ignorance?
No.
Brian Fitzpatrick phoned me, he knows about, and
told me to stand well back.
The thing is you shouldn`t let it be seen as you
having a go at Kevin or John the other thing is Chris Winslow.
Q: I put in a question to Elrick about whether someone
took over from Kevin who was also a campaigner for the labour
party, but I haven`t had a response.
The question is spot on.
Q: Any pointers on the person?
You seemed to have someone earlier...
Q: Suzanne Hilliard...
Spot on.
I was only ever a volunteer.
I was told you were working for John Reid and John
Maxton.
Aha. I suggest you phone John Reid and John Maxton.
... I`m a student, I`m at university, if you want to speak to
anyone.
DN: speak to your two employers?
Yeah.
It`s a straightforward thing, you were working for
them, you just don`t want to talk about it?
I just don`t want to talk about it. I don`t know
what context this is all about.
DN: The allegation is that you were, along with other
people, you were being paid as researchers to Westminster MPs,
but in fact working full-time as campaigners for the Labour Party?
Right.
DN: That`s the allegation.
contact the labour party, I was only ever a volunteer.
The question is whether or not you were working for
Westminister MPS while you were working as a volunteer for the
Labour Party? That you were being paid by Maxton and Reid while
you were working for the Labour Party.
I never worked for the Labour Party, I volunteered.
The work you did as a volunteer was full time?
No. I really don`t have anything more to say. To
be honest if you want to find out anything details of my employment,
you should go to Dr John Reid and John Maxton, I`m sure they would
be happy to confirm my, because I mean at the end of the day they
were my employers, and I`m sure if you went to the Labour Party,
they would confirm I was only a volunteer. I`m sorry, I really
don`t have any more to say ... I don`t want to be dragged into
this.
Q: As far as you were aware, was Suzanne Hilliard
working full time for the Labour campaign?
She was, yeah. She took a year out from Uni, I think.
She was doing media monitoring with Kevin Reid?
Yeah. She came in around Christmas time.
Q: Reid was involved in these strategy meetings,
in 98, just about as you
I remember them
Just about as you took over
Yeah
It was all grandiose strategy but no-one was dealing
with the nitty-gritty of how you get a machine up and running,
everyone was over-wrought and over stretched and there was only
one or two people ... and Reid said, someone said it`s all very
well you people talking about lofty ideas but on the ground we`ve
got nothing and we`re really overstretched, and Reid offered Kevin
and said: "I can help out, I want to be involved in this,
I`ve got Kevin sitting around doing nothing, you can use Kevin
and I`ll pay him.
Yeah
It was actually done on John Reid`s initiative
Yeah
The way it was put to me was, this is a normal thing
to do. It`s been done for donkey`s years and never been a problem
Yeah
Does that ring any bells? That would have been about
April. When was it you started?
About April. I don`t know where you get your sources
from, but yeah that`s (laughs) pretty ...
Does that chime with your understanding of it?
Yeah, very close I would say.
He explicitly offered it on that basis? That he would
be the one who pays for it?
I was quite taken aback by that...
Were you around when that offer was made?
Yeah, I used to attend these meetings.
It was actually made in a strategy meeting?
I don`t know where you get your sources, but that`s
certainly....
Sources telling the truth?
Near as damn it I would say....
Suzanne Hilliard, would you say she was working full
time throughout the election?
Everyone in that office was
There were no part timers?
No.
It seems to be a clear pattern with Reid and Maxton?
Yeah
I was told that Reid made this offer on a Sunday
morning in a strategy meeting on the top floor of Keir Hardie
House, with Gordon Brown, Donald Dewar was there, Paul McKinney,
John Reid in the corner with the ashtray, Brian Wilson ... you
actually remember being there do you?
I don`t know, I attended these meetings. Was I at
that one was I?
They couldn`t remember whether you were there or
not.
But the way the offer came up rings a bell with you?
It would have been me that had to deal with it. That`s the difficulty
for me here. The person who sanctioned all this is me. Sanctioning
is another thing. But In that sense you have to write it as it
is
Sanctioning is a different thing from whether you
remember being there at the meeting ... was it something that
was passed to you that came up at that meeting for you to deal
with?
I don`t know. I remember having discussions with
John Reid. I can`t be precise about what meetings or whatever,
but I did used to attend these meetings and I remember being in
meetings where Brian Wilson was down
He was at most of them?
Yeah, at that time he was part of that team ...
Was it a series of articles that caused the alarm
or one particular thing?
It wasn`t a series of things. It was something at
a UK level where we were attacking the Tories,
I remember reading it and thinking god, we`re attacking
them on a UK level, but (doing something similar in Scotland ourselves).
But any agreement on this stuff, has to be recognised that the
person who sanctioned anything was me. I`m relaxed about it in
a sense. I don`t want any favours, because if you give me any
favours it looks like I`m your source, which I`m not.
If it comes to court I`ll tell the truth.
I`m nervous of Reid because we`ve seen how he reacted
to that other stuff, the man is a hothead
Yeah
I want to make sure I`m on solid ground with it.
I feel confident about it now.
You seem to have a number of sources who are all
confirming it.
There was no money from the Labour Party at that
time.
He was cutting the newspapers in the morning. Came
in at 8 am, cut the newspapers and photocopied them. Started on
an ad-hoc basis, but he was around for the rest of the day, answering
the phones. He was very eager to learn and help. I think his Dad
said I will help you out. You can have my boy and I will pay for
him. John Reid said I want to help and be a part of this outfit.
This was in April 98. I`m pretty certain. Reid was hanging around
at the weekend strategy meetings, brought in by Number Ten to
keep an eye on Gordon Brown. He didn`t do very much. After two
or three weeks I was beginning to report to these meetings that
while they were sitting around talking, there`s only me here.
He (Reid) said my boy`s not doing anything, he can come in and
I will find a way of paying him. I think he would have come in,
might have been end of April. The impression I had was that it
was voluntary. It was the sort of thing which traditionally went
on for a long time. Everyone in the office was working full time.
The strategy meeting was on the top floor of Keir Hardie House
on a Sunday morning. Donald Dewar, Brian Wilson, Alex Rowley had
just started. I don`t know if Gordon was there, I think he was.
Gordon Brown, Donald Dewar, me, John Reid in the corner with the
ashtray, Brian Wilson.
She Suzanne Hilliard was working for Reid, she was
around a lot. She was a volunteer, she was working in the monitoring
unit with Kevin Reid. Kevin broke his arm and couldn`t type. She
was basically doing it. It was just Kevin and Suzanne with some
volunteers.
Received 14 March 2000
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