Background: Al Yamamah
In December 2006, the Serious Fraud Office (SFO) announced that it was dropping an investigation into allegations that BAE Systems plc paid bribes in order to secure the Al Yamamah arms deal with Saudi Arabia in the 1980s. This was Britain’s largest ever export agreement, and most recently involved a contract to supply 72 Eurofighter jets. According to Tony Blair, the decision to end the Al Yamamah investigation was taken in the interests of national security as Saudi Arabia is an ally in the War on Terror.
The Conservatives have been criticised for their silence over Al Yamamah, leaving it to the Liberal Democrats to take the lead on pressing the Government over Al Yamamah.
On June 7th 2007, Liberal Democrat Leader Sir Menzies Campbell challenged the Prime Minister over Al Yamamah following the revelation by the BBC that over £1 billion had been paid in secret to a Saudi prince:
“When I questioned the Prime Minister about this issue in the House of Commons, he took full responsibility for the decision to discontinue the investigation into BAE. In light of BBC’s allegations, the Prime Minister must make a full and detailed statement to the House of Commons.”
On January 12th 2007, Ming Campbell had written to the Prime Minister expressing his concern that the ending of the SFO Al Yamamah investigation undermines “Britain’s reputation for abiding by the rule of law”. He referred to suggestions that Saudi Arabia had threatened to cancel the Eurofighter contract and to refuse future business from British companies. Sir Ming also raised concerns over
“…the potential conflict of interest between the Attorney General’s judicial role as the Government’s senior law officer and his political role as a member of the cabinet.
“It is time to reconsider whether law officers who are Government ministers can give proper protection to the independence required in their role in considering whether criminal charges in England and Wales should be pursued.”
In the last debate of 2006, Simon Hughes MP, the Liberal Democrats’ Shadow Attorney General, had raised these concerns in the House of Commons regarding the Al Yamamah investigation. He later said:
“The Prime Minister’s statement on Friday made clear that Mr Blair took responsibility for the decision to drop the prosecution when the only ministers with any constitutional role in prosecutions in England and Wales are the Attorney General and Solicitor General. The Prime Minister’s statement makes a mockery of Law Officers’ independence and makes it impossible for Law Officers credibly to claim they were not influenced by political considerations.”
In the same debate, David Heath MP, Lib Dem Shadow Leader of the House, calledthe decision to drop the Al Yamamah investigation “the last nail in the coffin of the so-called ethical foreign policy”.
On February 1st, Liberal Democrat members of the House of Lords used a debate to question the Attorney General on his reasons for supporting the Serious Fraud Office’s decision to drop the Al Yamamah investigation. Baroness (Shirley) Williams of Crosby said:
“The Attorney General must explain why the investigation was dropped. Being seen to turn a blind eye to corruption not only harms Britain’s standing with the international community, it potentially breaks OECD rules. BAE must not be allowed to act above the law.”
Later in February, the Liberal Democrats used an Opposition Day in the House of Commons to highlight the damagedone to British business by the decision to end a probe into the Al Yamamah deal, and to call for unpublished papers into the Al Yamamah arms deal - including the only National Audit Office (NAO) report never to have been put into the public domain - to be released. The party’s motion also called for an independent inquiry into the ending of the SFO investigation.
During the debate, Liberal Democrat Deputy Leader Vincent Cable said:
“The position of the Liberal Democrat party is that the Government’s decision has done enormous damage, which has undermined the rule of law and Britain’s reputation within the Organisation for Economic Co-operation and Development as a country that applies international law. It has also undermined both our reputation in the developing world—where the Government, through the Chancellor and the Secretary of State for International Development in particular, lecture on corruption—and that of honest, good British companies that are trying to apply the law, whether in relation to financial services or manufacturing. It has also undermined the position of the House because of the anomalous situation in respect of the unpublished Public Accounts Committee report of 15 years ago, which, I understand, no Member present - including you, Mr. Deputy Speaker, and the Chairman of the Committee - has ever read.”
The Conservatives failed to back the motion and it was defeated by the Labour Government.
The Liberal Democrats subsequently referred the Government to the European Commission which will consider if its rules were broken by the abandonment of the Al Yamamah investigation.
In January, the Organisation for Economic Co-operation and Development (OECD) said there are “serious concerns” about the decision to stop the Al Yamamah investigation, which may not be consistent with the OECD’s Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. Ming Campbell noted at the time that “any government other than Mr Blair’s would be deeply embarrassed by this criticism.” The OECD will report on the UK’s compliance with the convention in March, and then decide what action to take against the UK.
The SFO is continuing to investigate the sale by BAE Systems plc of a military air traffic control system to Tanzania, plus claims regarding BAE’s activities in South Africa, Romania, Chile, the Czech Republic and Qatar, plus allegations of bribery and fraud in Bosnia, Nigeria, Zambia, Costa Rica and Egypt. The Liberal Democrats have demanded assurances from the Government that these investigations will be properly supported.
