Previous Section Index Home Page

30 Jan 2007 : Column 151


30 Jan 2007 : Column 152

Sale of Radar System (Tanzania)

Mr. Deputy Speaker (Sir Michael Lord): I must tell the House that Mr. Speaker has selected the amendment standing in the name of the Prime Minister. I must also tell the House that Mr. Speaker has placed a 12-minute limit on Back-Bench speeches in the debate.

7.18 pm

Mr. Andrew Mitchell (Sutton Coldfield) (Con): I beg to move,

Our purpose in calling tonight’s debate is not only to hold the Prime Minister to account for his decision on this deal, but to help ensure that the mistakes made by the British Government in the handling of this issue do not happen again. I note that the Secretary of State for International Development refers in his amendment to new procedures, so I hope that he will spell out precisely in his reply how they would stop any recurrence of such events.

We are concerned that if those circumstances were to be repeated, there is little doubt that public support for the British international development agenda, which the Secretary of State and I hold dear, could be seriously eroded and undermined. I remind the House of the relevant facts. In 2001, the British Government were asked to consider applications for export licences for the sale to the Tanzanian Government of an air traffic control system. The system cost £28 million and the heavily indebted Tanzanian Government took on more debt to secure it. The International Civil Aviation Organisation said that the system was

The International Monetary Fund told the Prime Minister that it was very concerned about the impact of the purchase on Tanzania’s external debt burden. The sale was opposed by leaders of Tanzanian civil society, who advised the Prime Minister that it was “too expensive” and “murky”. In Britain, a wide spectrum of international development organisations were completely opposed to the deal. Oxfam said that the deal was “outrageous” and

30 Jan 2007 : Column 153

Many in Britain felt that the money would be better used to tackle disease and to promote primary education.

Mr. John Spellar (Warley) (Lab): Before the hon. Gentleman gets to the main part of his speech, will he tell us whether he thought that the existing system was adequate and what should have replaced it?

Mr. Mitchell: As the right hon. Gentleman will well know, its replacement had the full support of this side of the House, so I do not see the relevance of that to the case that I am making.

The contract was opposed by the World Bank, which argued compellingly that the £28 million system was far “too expensive” and was outdated, and that a satisfactory system could have been secured for a fraction of the price.

Susan Kramer (Richmond Park) (LD): Did the Tory party, or anybody on the Tory Front Bench, object at the time?

Mr. Mitchell: I am delighted to assure the hon. Lady that we did. In order to ensure that I am fully informed about these points, I have taken a note of what my predecessors said. The former shadow Secretary of State for International Development said:

My hon. Friend the Member for Banbury (Tony Baldry) said:

The answer to the hon. Lady is that, absolutely, we did make that clear.

Of particular significance is the fact that the sale was opposed by the then Secretary of State for International Development, the right hon. Member for Birmingham, Ladywood (Clare Short), who, according to The Guardian, said that the deal “stank”. It is entirely clear that her role in this sorry saga was, throughout, beyond reproach. I pay tribute to the many officials at the Department for International Development who stuck their necks out to argue forcefully around Whitehall against the consents.

Mr. Kevan Jones (North Durham) (Lab): Is not the system for both civilian and military use in Tanzania? The hon. Gentleman says that the system is outdated, but is it not used in, I think, eight regional airports in the UK?

Mr. Mitchell: The hon. Gentleman may well be making an interesting point, but it is not relevant to the argument that we are exploring.

Despite the opposition of all the most informed, respected and qualified observers, approval for the licences was forced through a divided Cabinet by the Prime Minister. The licences were granted on 20 December 2001. Early last year, the Serious Fraud Office started investigating the deal for alleged corruption. On 15 January 2007, The Guardian
30 Jan 2007 : Column 154
reported that some $12 million had been secretly paid into the Swiss bank account of an agent with connections to senior military and Government officials in Tanzania.

Those revelations have been greeted with outrage by ordinary people in Tanzania. On 20 January 2007, hundreds of people took to the streets of Dar es Salaam to insist that any wrongdoers are brought to justice. A senior Opposition leader said that the money should have been

Just as those people are calling their Government to account, we should ask detailed questions of our Government about their role in this matter. The revelations raise serious questions about the depth of the scrutiny that was given to the deal when it was considered and the wisdom of the Government in making that decision. The matter should cause us to pause and think carefully about how we interact with Governments in developing countries and to what extent we can and should second guess their priorities if the British taxpayer is partly or wholly footing the bill.

Susan Kramer: Does the hon. Gentleman agree that what will distress the people of Tanzania greatly is the feeling that there is hypocrisy in the system and that there is a double standard? Similar allegations will be set aside when a friendly country such as Saudi Arabia is involved, but they will be pursued with energy by both Tory and Labour Front Benchers when a small African country is involved.

Mr. Mitchell: The hon. Lady makes an interesting point about Saudi Arabia, but that is not the subject of the debate.

The Tanzanian context of the deal cannot be ignored. Tanzania is one of the poorest countries in the world. In 2001, more than half the population lived in severe poverty. Life expectancy at birth was 45 years. Primary school enrolment was 67 per cent. Some 2 million people were living with HIV/AIDS. Tanzania had a national debt of $5.4 billion. It had recently received debt relief from the World Bank and the IMF through the initiative for heavily indebted poor countries. For a long time, Britain has been a major donor. In 2000-01, we gave £111 million—£35 million of which was in direct budget support. In handing over that money, British taxpayers wanted, and Tanzania needed, every possible penny to be spent on measures to promote development, such as building basic health and education systems and tackling killer diseases. According to Oxfam, £28 million could have provided basic health care for 2 million people or an education for 3.5 million children.

We now know that the issue provoked lively debate in the Cabinet. It is worth noting the powerful case that the then Secretary of State for International Development put forward. She rightly acknowledged that Tanzania could benefit from improved air traffic control, but many experts made it clear at the time that they thought that the dual military/civilian radar system that was sold was vastly overpriced. Despite the high price tag, the system would cover only a third of the country. According to the World Bank, a much
30 Jan 2007 : Column 155
cheaper and more suitable civilian system could be bought. Indeed, in a bid to be helpful it commissioned the International Civil Aviation Organisation to examine the suitability of the proposed system. On 8 November, the ICAO returned with an extremely critical preliminary report that dismissed the system as using ageing technology and described it as

That was sent to the then Secretary of State for International Development, the right hon. Member for Birmingham, Ladywood, who in turn distributed it among the Department of Trade and Industry, the Ministry of Defence and the Foreign Office. Despite those condemnatory initial findings, the Prime Minister did not wait to hear the results of the full ICAO report—he forced approval through the Cabinet.

Daniel Kawczynski (Shrewsbury and Atcham) (Con): Does my hon. Friend agree that it is regrettable that the right hon. Member for Leicester, West (Ms Hewitt), the then Secretary of State for Trade and Industry, is not in the Chamber to hear these allegations? She was instrumental in getting the deal forced through at the time.

Mr. Mitchell: My hon. Friend makes a point, but I have no doubt that the Secretary of State for International Development will answer on behalf of the former Secretary of State for Trade and Industry.

Tony Baldry (Banbury) (Con): I think that I am correct in saying that when the Select Committee asked the then Secretary of State for Trade and Industry she refused to allow her officials to come to give evidence to the Select Committee. That was rather depressing. One of the other depressing things is that the Select Committee was always told that the deal was the wish of the Tanzanian Government. That sends out some alarm signals for the future in relation to budget support. Having the concept of budget support and being told that the deal was what the Tanzanian Government wanted was almost like saying, “Well, there is no scrutiny because this is what the Government of Tanzania want.”

Mr. Mitchell: My hon. Friend makes a good point about budgetary support. However, British aid has strengthened civil society in Tanzania, and that is one of the reasons why we are hearing such comments about the deal and why Tanzanian civil society is making representations.

David Taylor (North-West Leicestershire) (Lab/Co-op): To develop the intervention made by the hon. Member for Richmond Park (Susan Kramer), what conclusions does the hon. Gentleman draw from the craven abandonment by the SFO of the investigation into BAE Systems’ payments to Saudi Arabia, with a gross national income of—

Mr. Deputy Speaker: Order. This debate is not about Saudi Arabia. It is possible to make a passing reference to it, but that is all.

30 Jan 2007 : Column 156

Mr. Mitchell: Thank you, Mr. Deputy Speaker.

Mr. Tobias Ellwood (Bournemouth, East) (Con): Has my hon. Friend read reports that the Watchman air traffic control system that was sold to Tanzania had been built prior to Cabinet approval? If those reports are true, does he agree that that is one of the reasons why the deal was forced through the Cabinet?

Mr. Mitchell: My hon. Friend is right that there was a system of prior approval. I hope that the Secretary of State will tell us that that is one of the aspects of the procedure that has been tightened up since.

Many in Tanzania have remained outraged by our Prime Minister’s casual approach. A letter from leading Tanzanian non-governmental organisations said:

The NGOs questioned the degree of scrutiny that the Tanzanian Cabinet and Parliament had given to the deal. Tellingly, they said:

They called for a full public inquiry.

Above all, it was astonishing that the Government cast aside criterion 8 of the consolidated European Union and national arms export licensing criteria. I remind the House that the Prime Minister sent his Ministers scurrying throughout Europe to secure the criteria, which outline the things that a Government must take into account when deciding whether to issue an export licence.

Criterion 8 states that a Government must consider whether a proposed export would help or hamper the sustainable development of a recipient country. It explicitly states that decisions should be taken

the World Bank and the IMF—the very organisations that condemned the deal. Why, when the consolidated criteria explicitly set out a requirement of consultation with bodies such as the World Bank and the IMF, did the Government not only pointedly ignore those bodies’ recommendations, but grant the licence before the bodies had even had time to deliver their full conclusions? In the light of that, let us hear today why the British Government concluded that spending £28 million—more than a quarter of the value of UK aid to Tanzania—on an outdated and unsuitable radar system did not completely contradict the very guidelines that they had so warmly embraced?

Hugh Bayley (City of York) (Lab): Surely the hon. Gentleman misleads the House if he suggests that British aid was used—

Mr. Deputy Speaker: Order. The hon. Gentleman should beware. We choose our words very carefully in the House. Perhaps he would like to rephrase that.

Hugh Bayley: Is the hon. Gentleman suggesting that British aid was used to buy the system, or, indeed, that British aid should be cut as a result of the Tanzanian
30 Jan 2007 : Column 157
Government’s decision to buy the system? Tanzania is achieving improvements against the millennium development goals, but that progress would be lost if we stopped giving it aid.

Mr. Mitchell: The hon. Gentleman knows very well that we have strongly supported giving British aid to Tanzania. However, it is right for the House to take account of the fact that the deal caused the Tanzanian Government to incur a debt of some £28 million. That debt must be paid back at the same time that the UK taxpayer is giving aid to Tanzania. Although the two payments are not directly related, I am making an important point about the way in which the debt was contracted, given the importance of having confidence in the system of budgetary support.

Hugh Bayley: The hon. Gentleman, speaking as the shadow Secretary of State for International Development, says that he opposes the decision taken by the Tanzanian Government, as I do. However, what aspect of Britain’s international development policy towards Tanzania would he change?

Mr. Mitchell: Given that the hon. Gentleman says that he, like me, opposes the deal, I am delighted that he has taken the trouble to come along to the debate. As I develop my case, his question will be very fully answered.

Norman Lamb (North Norfolk) (LD): Will the hon. Gentleman give way?

Mr. Mitchell: I am going to make a little progress.

If the Government argue that a judgment call was taken after lengthy consideration, will the Secretary of State explain why the Government acted without reference to the opinions of those best placed to comment? Will he explain whether the Government knew of the $12 million payment to a Swiss bank account when the export licences were granted? If the Government had known about that payment, would the export licences still have been granted?

Nearly two weeks ago, I tabled a named day question to the Prime Minister for answer on 19 January. The question asked the Prime Minister when he was first informed of allegations that excessive payments had been made or agreed to secure the contract for a military air traffic control system in Tanzania. As of today, I have still not received a response to that question. It appears not only that the Prime Minister does not bother to attend debates in the Chamber, as we learned last week, but that he does not trouble himself to answer named day questions.

Next Section Index Home Page