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Interestingly, Mr. Wardle told the Constitutional Affairs Committee that from the documents that the director was shown, Sir Richard Mottram did not take that risk into account. Again, it can be seen in Mr. Wardle’s evidence to the Committee that it was assumed that none of this would ever come out, and
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that the whole thing could be swept under the carpet. If that is true, the Government have added incompetence to their weakness of will.

The Solicitor-General: I am not entirely sure that I follow the hon. Gentleman, but I think that he is suggesting that we should ignore the possibility of a serious threat to public safety in this country and in the middle east because it comes from the quarter being investigated; and that even though we understand the centrality of Saudi Arabia in our counter-terrorist intelligence activities, we should make some bold swashbuckling stand against them like Braveheart, notwithstanding what such action might do to people in this city and throughout the UK.

David Howarth: There are two points: first, what was done was wrong; secondly, it was a mistake. It was wrong because it is wrong to give in to such blackmail. It was a mistake because in the long term, giving into such pressure is a greater threat to national security.

Mr. Borrow: I am just trying to probe the issue. On the basis of the information that the hon. Gentleman has, he has come to a view that Mr. Wardle’s decision to halt the inquiry was wrong. However, the hon. Gentleman does not have access to all the information that Mr. Wardle had when he reached that decision, because the hon. Gentleman has not had those meetings with the ambassador to Saudi Arabia that were so crucial to Mr. Wardle reaching that decision. Is the hon. Gentleman absolutely confident that whatever the circumstances and whatever additional information might be available, he would still come to the same view that he holds now?

David Howarth: Since I said some minutes ago that one of the big problems with this issue is the lack of openness and scrutiny of the evidence, of course I cannot be absolutely confident. However, even accepting the uncertainties, there is a case for saying that the wrong decision was made.

Finally, if one looks at the events in the round, there is an implausibility about them, to use the word that the Solicitor-General picked up on. The implausibility is this: would a country that is our ally in the fight against terrorism take the actions that are currently being attributed to it and threaten the withdrawal of co-operation in the fight against terrorism, because of financial embarrassment? It might be true that they were persuaded that there would not be any effect on their reputation, because it was thought—perhaps on the Government’s assurance—that none of this would come out. The other, more disturbing possibility, however, is that the Saudis are perhaps not the principal villains of this piece, and that the Government’s main concern is not to conceal wrongdoing by foreign Governments or officials, but to conceal their own incompetence and wrongdoing in this country.

6.26 pm

Mr. Andrew Tyrie (Chichester) (Con): I shall vote for the motion tonight and I voted for a similar motion in February. Almost all the points that I wanted to make have been made by the hon. Members for Twickenham
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(Dr. Cable) and for Cambridge (David Howarth), and the latter made some points, particularly his legal points, I had not thought of. I shall therefore make one specific point and then draw some general conclusions.

In this case, the investigation was brought to an end as a consequence of information provided in a memo, as we have heard again today, prepared by Richard Mottram for the Serious Fraud Office, and as a consequence of a series of oral briefings by the UK ambassador to Saudi Arabia. Robert Wardle provided the Constitutional Affairs Committee, on which I serve, with details of that information when he appeared before it. In this House, none of us, except the Solicitor-General, is in any position to judge whether the correct decision was taken on the basis of that information. We have not seen the memorandum, and we have not heard what the ambassador said. However, the Intelligence and Security Committee can see the material, and it can also summon witnesses, including the ambassador. That is why I strongly support the view that that Committee should consider the matter, and why I suggested that it investigate and report back to Parliament. That is what it exists to do.

I encouraged the right hon. Member for Berwick-upon-Tweed (Mr. Beith), the Chairman of the Constitutional Affairs Committee, to write to the Intelligence and Security Committee, on which he also serves as a member, asking it to initiate that investigation. We have not yet had a reply. On the basis of such an investigation, we might receive some reassurance about whether the decision was taken on a reasonable interpretation of the evidence. I welcome the Solicitor-General’s remarks about the need to strengthen parliamentary scrutiny of the security services and the information that they provide.

I have the same intuitive doubts about the security arguments as the hon. Member for Cambridge. It strikes me as implausible—to use a word that, although widely ridiculed in the House, is a perfectly reasonable expression of something short of certainty—that the Saudi Arabians would want to cut off their noses to spite their faces. They must realise that if they were to cut off co-operation with us, we might be less keen to supply them with information collected here, which is valuable to them in dealing with al-Qaeda domestically.

Incidentally, I am disappointed that the Quadripartite Committee, which was specifically set up to consider such issues in the light of legislation put on the statute book five or six years ago, has failed to announce that it will take a look at the issue—I hope that someone is listening to that remark.

My remaining quick remarks relate to a number of suggestions made by the hon. Member for South Ribble (Mr. Borrow). He has strongly implied that the decision not to go ahead with the investigation is justifiable on commercial grounds. The right hon. Member for Warley (Mr. Spellar) made that point in February, and my hon. Friend the Member for Aldershot (Mr. Howarth) has made a similar point. Those hon. Members have repeatedly sought to justify the decision not to take the matter any further on the grounds that jobs—in particular, jobs in their constituencies—are at stake. I understand that hon. Members who have constituencies where jobs are at
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risk want to make those points, but that does not constitute an argument for not investigating the matter further.

Mr. Borrow: My argument is not that the investigation should be halted because of the number of jobs at stake; it is that because the investigation has been stopped on proper and appropriate legal grounds, those who object to and disagree with the decision are putting employment in the defence industry at risk by continuing to challenge the decision and publicise their opposition to it.

Mr. Tyrie: In saying that, the hon. Gentleman is also lining up for criticism the director of the SFO, who has made it clear that he is disappointed that the investigation is not proceeding. In any case, a number of other hon. Members have made the point to which I have alluded and which the hon. Gentleman has qualified—it is all available in Hansard.

Mr. Hendrick: Will the hon. Gentleman give way?

Mr. Tyrie: In view of the number of interventions that the hon. Gentleman has made that added nothing, I am reluctant to give way, but on this occasion I will do so.

Mr. Hendrick: I thank the hon. Gentleman for his extreme generosity. A number of hon. Members were concerned about the impact on jobs, but that was only a collateral issue. The key issue is clearly national security. The longer that Liberal Democrat Members and people such as the hon. Gentleman pursue this media campaign, the more damage will be caused not only to jobs, but, if the Liberal Democrats and the hon. Gentleman have their way, national security.

Mr. Tyrie: It is important that we weigh in the balance the arguments on national security by asking the Intelligence and Security Committee to consider them and to report to Parliament, and I hope that it will do so.

The hon. Gentleman described the jobs argument as “a collateral issue”, but either there are or there are not commercial considerations that should be taken into account. If it was right to take those considerations into account—I do not agree that this is the right approach—I have not seen a thorough assessment of the value for money of that huge deal. I do not know the extent to which the British taxpayer has subsidised the deal, and I do not think that anyone present in the Chamber knows, either.

Nor am I aware of any estimate of the commercial cost of the risk that is sitting on the Export Credits Guarantee Department’s books as a consequence of the deal—if anyone has seen an estimate, I would be interested to hear about it. The ECGD’s accounts are still, after many years of pressure for reform, opaque. In my view, when a default comes through on the ECGD, it should score not against the public sector financial deficit, but as public expenditure against the budget of a particular Department. That would allow us to compare the value of that credit guarantee
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against other forms of public expenditure in which that Department is engaged. We need much more transparency in the work of the ECGD, because deep in the recesses of how the arms industry is conducted lies a worrying lack of transparency.

Lynne Featherstone: Will the hon. Gentleman give way?

Mr. Tyrie: If the hon. Lady will forgive me, I will not do so on this occasion, because, first, I am about to conclude and, secondly, the winding-up speeches are about to begin.

I want to finish the point about jobs. I have mentioned the ECGD and the fact that we do not know what other subsidies financed the deal. One thing that we learned in the 1970s is that propping up jobs by Government subsidy—throwing public money at them—is always a counter-productive waste of money in the long run, which is why such subsidies were largely wound up in the 1980s. The arms industry has, to some degree, succeeded in exempting itself from the full pressures of the commercial marketplace, which concerns me.

Finally, has this issue now been put to bed? I think not, for two reasons. First, it is likely that the US authorities will pursue the matter and that the damage to BAE Systems will persist, which will in turn continue to harm Britain’s reputation. Secondly—this point has not been raised in today’s debate—the security considerations that led to the decision may change. Are we sure that the Saudi regime will always maintain its threat to close down security co-operation if the investigation is reopened? If and when there is a shift in the Saudi position on the deal, which has many years to run, the SFO is at liberty to reopen the investigation. Indeed, in response to a question from me on exactly that, Robert Wardle said in the Committee that his office will keep under review the assessment of the national security risk.

The issue has not finally gone away, and it has not finally been put to bed. It is a matter for debate whether we are in a better position than we would have been had the investigation been allowed to continue. What have we really gained by terminating the investigation? Well, we have gained some time. Are we more secure as a result? It has been asserted that we are, but I would like the Intelligence and Security Committee’s reassurance on that point. Are economic benefits being secured? I would be very surprised if the balance of benefits and costs of the deal as a whole is clear-cut, but, again, I do not have the information—the fact that the PAC report has not been published makes such a judgment more difficult. There is also the question of damage to reputation, where nothing has been gained and almost certainly quite a lot of damage has been done. Overall, did the Government make a mistake? It is difficult to tell, but I will not form my judgment until an Intelligence and Security Committee investigation has taken place and we have debated it.

6.38 pm

Mr. Michael Moore (Berwickshire, Roxburgh and Selkirk) (LD): It is a pleasure to follow the hon. Member for Chichester (Mr. Tyrie), who made many points that I might otherwise have raised. A relatively
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short period of the debate remains, and I will make sure that the Minister gets plenty of time to cover the main issues and some of the points that the Solicitor-General did not address earlier.

I want to pick up some of the contributions to the debate. My hon. Friend the Member for Cambridge (David Howarth) set out a forensic examination of the Attorney-General’s role. I am disappointed that, unlike the hon. Member for Chichester, Conservative Front Benchers and others will not support us in the Lobby in a few moments’ time. However, we welcome the fact that the Conservative spokesman, the hon. Member for Huntingdon (Mr. Djanogly), set out his party’s concern about many of the issues and the fact that procedures need to be tightened. He was also right to spend a bit of time on the issues arising out of the deal with Tanzania—a matter that my hon. Friend the Member for North Norfolk (Norman Lamb) has pursued doggedly for a number of years and is still asking questions about.

As well as the speech by the hon. Member for South Ribble (Mr. Borrow), there have been several interventions in which Members have understandably, and rightly, considered the economic aspects of this and the jobs that they believe may be at stake. The hon. Member for Chichester set out some of the genuine concerns that we as parliamentarians must raise about the use of public money for some of these contracts. It is unfortunate if those of us asking questions are to be tarred as being somehow against jobs, because that is far from the truth. However, I do not dispute the right of the hon. Member for South Ribble and others to make the case for their constituents.

Lynne Featherstone: Given the very limited number of players in the field capable of supplying massive arms contracts, does my hon. Friend agree that if there were a strong international will in all countries, from Governments down to suppliers, to cut out corruption, the business would still be there but costs to businesses would be cut because corruption would be cut?

Mr. Moore: My hon. Friend raises an important point about the importance of international agreements and arrangements—a matter that has been discussed in the course of this debate and that we must keep scrutinising in this House and elsewhere.

We have not questioned the integrity of officials or of right hon. and hon. Members. We have asked questions, legitimately, about the roles that certain individuals have played, but we have not questioned their integrity. However, we do question the integrity of the processes by which we in this place are able to scrutinise the Government, and therefore make no apology for the fact that we have returned to this subject less than six months after we last introduced a debate on it. The issues are of such magnitude, and Parliament’s need to scrutinise them is so serious, that we are happy to have provided another rare opportunity for debating them.

Several issues have been raised in the past couple of hours. My hon. Friend the Member for Twickenham (Dr. Cable), who set out our case at the start of the debate, advanced the arguments relating to al-Yamamah in detail, so I will not repeat them in the brief time available to me. On the other investigations, I
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am grateful to the Solicitor-General for setting out a summary of where she understands them to be going. She has dismissed all our inquiries as mere innuendo, in which respect she follows her predecessor, who used a similar tactic in the previous debate. For the purposes of this debate, let us accept that on the Government Benches attack is the best form of defence.

Greg Mulholland (Leeds, North-West) (LD): Does my hon. Friend recognise a wider point concerning the Government’s astonishing arrogance in not acknowledging the real shame that this has brought on the country? To give one example from the foreign press, The Hindu said, on 11 June:

Is it not true that damage is being done and that the message is, “One rule for the rich nations and one for the poor”?

Mr. Moore: My hon. Friend raises an important issue about Britain’s reputation on the world stage—one that the Foreign Affairs Committee highlighted in its recent report on human rights, which concluded:

In their response to the report, the Government asserted that the Organisation for Economic Co-operation and Development working group “welcomed the UK’s openness” in their meetings with the group. Well, yes, it would. However, their response plays down the group’s remaining concerns, and they have not fairly represented the seriousness of the views held by the OECD. Let us remember that following the March 2007 meeting at which the SFO inquiry was discussed with the UK representatives, the working group stated that it

That is where we stand in the international dock. Our reputation as a country is surely at stake, as this investigation makes clear.

Perhaps more immediately, our relationships with key partners are also at stake. In this regard, we all understand the importance of our relationship with Saudi Arabia. Beyond the economic significance of our links in oil, industry and services, we have common interests in the safety of the region and the development of a middle east peace plan. Nobody can deny the significance of the ties in relation to security co-operation. In our February debate on this matter, the Minister for the Middle East, whom we are pleased to see still in his place, underlined that with appropriate conviction:

After giving an appropriate example of the links between Saudi dissidents and al-Qaeda, he said:

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I agree with him wholeheartedly on that. He rightly went on to remind us that UK citizens have been the victims of terrorist attacks in the region and that British co-operation with the Saudis is therefore critical. However, just before that section of his speech, he pointed out the needs of the Saudis themselves:

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