Symon Hill | ukwatch.net

BAE: No Way Out

Arash Sedighi — Tue, 07 Oct 2008 11:47:39 +0000

When the Law Lords delivered their judgment in the legal challenge brought by CAAT and The Corner House this was not the end of the matter. The case and the related Control BAE campaign have had a huge impact on public perceptions and political realities. Ann Feltham and Symon Hill tell how the company remains under pressure from all directions

CAAT and The Corner House launched the case in December 2006, when the Serious Fraud Office (SFO), acting under government pressure, dropped its corruption investigation into BAE’s Saudi arms deals. The decision followed lobbying by BAE and the Saudi regime and triggered widespread outrage. Our challenge was initially successful; the High Court ruled in April that the SFO had acted unlawfully in dropping the investigation. However, the SFO appealed and the Law Lords overturned this ruling on 30th July. This was a disappointment – but not a defeat. While it would have been excellent if the Lords had confirmed the High Court’s ruling, their decision provoked little cheer for the arms industry, aware of how much has changed in the last two years.

Progress

Even commentators friendly to the arms trade admit how much we have achieved. So let’s remind ourselves what’s changed:

• Most obviously, it will be much harder for government to intervene so blatantly on BAE’s behalf again. While the government remains loyal to the arms industry, it knows the reaction that this can get.

• The issue of arms companies’ influence within government is now firmly on the agenda. More people than ever are aware of this influence, and realise that the arms trade will not be significantly reduced while it remains. As an example of how mainstream this issue has become, let’s remember that the call to reopen the SFO investigation was supported by over 130 NGOs and 125 MPs from many parties, including six Tories.

• The legal position has been clarified, with the authorities effectively admitting that there is no provision in law to prevent a prosecutor in the UK from being bullied by a private company or another country’s government into dropping an investigation.

• CAAT’s profile has increased significantly. More of the media take CAAT seriously and there is greater public awareness of CAAT’s work.

• Public outrage generated by the BAE situation has contributed indirectly to recent CAAT campaign victories. These include the closure of the government’s arms marketing unit, DESO, the decision by Reed Elsevier to sell its arms fairs and moves by universities to ditch arms investments.

• We have shown that radical campaigners working effectively can have a big impact. The campaign brought together varied campaigning methods, including legal action, grassroots activism, media engagement, , local campaigning, parliamentary lobbying and alliance-building.

• The increased understanding of a cosy relationship between arms companies and government has placed us in a strong position to campaign on other aspects of this issue, particularly the arms functions of UK Trade and Investment.

CAAT supporters have played a huge role in bringing about these changes, whether by campaigning in the street, sharing their views with friends, making donations or giving encouragement to other activists and CAAT staff. But CAAT and The Corner House cannot claim all the credit. BAE and the UK government remain under pressure from a number of sources.

Still going on

...the US investigates
BAE’s Saudi deals have been under investigation by the US Department of Justice since June 2007 when the Guardian and BBC’s Panorama alleged that £1 billion was being paid to Saudi Prince Bandar via Washington’s Riggs bank. The next month Parliament was told that the US had formally asked for help from the UK under a Mutual Legal Assistance agreement. The Home Office has yet to respond formally.

In connection with the US investigation, former BAE Chief Executive Mike Turner, non-executive Director Sir Nigel Rudd and Group Business Development Director Alan Garwood (former head of DESO) were stopped at US airports in May and served with subpoenas (commands to appear at a later date and answer questions). Worryingly though, Defense News reported in September that US and UK authorities were attempting to negotiate an end to the US investigation.

...Switzerland too
In mid-July federal prosecutors in Switzerland said they were conducting three criminal investigations into possible money laundering linked to BAE.

...the other BAE deals
BAE is still facing six other SFO investigations. They involve deals with Chile, the Czech Republic, Qatar, Romania, South Africa and Tanzania.

...the poor reputation
Despite saying that it will implement all of the recommendations made by Lord Woolf’s Committee on ethical practices, the company’s poor reputation remains. Newspaper articles to mark Mike Turner’s retirement at the end of August all mentioned the corruption allegations. His successor as Chief Executive, Ian King, is likely to have to live with them.

The UK government’s still in trouble

...with the Constitutional Renewal Bill
The draft Constitutional Renewal Bill includes a proposal to give the attorney-general a statutory right to cancel an SFO investigation on grounds of national security. Prompted by our legal action, this would prevent any judicial review of such a decision, and would provide for little meaningful accountability to Parliament. However, many parliamentarians and lawyers are concerned. It will be interesting to see if the government makes any amendments to the draft Bill before it is presented to Parliament in the 2008-9 session. If it does not, the Bill should provoke a lively debate.

...and the OECD
In October, the Organisation for Economic Co-operation and Development (OECD) Working Group on Bribery will receive a report into the UK following the dropping of the investigation. This is unlikely to make easy reading for the UK government. In the light of the Lords’ ruling, it is now even more vital that the
Working Group draws up clear guidelines that state that there is no national security exemption to the OECD Convention, and making clear in what circumstances a defence of ‘absolute necessity’ is allowed.

CAAT continues to challenge the Saudi deals

Articles by investigative journalists, documents from the National Archives, the witness statements in the Judicial Review and Information Tribunal cases, requests under the Freedom of Information (FoI) Act, parliamentary answers, these are all helping build a picture of the cosy UK government-BAE-Saudi relationship which facilitates arms sales to one of the world’s most repressive regimes. It also helps CAAT to challenge these sales.

...Salam and the SBDCP
So, in a nutshell, what’s going on now? The Air Defence Variant Tornadoes supplied under the Al Yamamah contracts of the mid-1980s are now being replaced by 72 Eurofighter Typhoon aircraft under the Project Salam. This was agreed in outline between the UK and Saudi governments in 2005 with a more detailed contract signed in 2007. The UK MoD complements this with a contract with its main contractor, BAE.

The first 24 planes will be built at Warton in Lancashire, with the remainder likely to be assembled in Saudi Arabia. The other Saudi Tornadoes will be upgraded and serviced under what is now called Saudi British Defence Co-operation Programme (SBDCP). Whilst the original Al Yamamah purchases were paid for in oil, both Project Salam and the SBDCP are being paid for out of the Saudi defence budget.

Recently, there has been talk of selling even more Eurofighter Typhoons to Saudi Arabia. These would be those the UK is committed to buying for the RAF, but struggling to find the money for in the defence budget.

...MODSAP
Ever since 1973, in a pre-Al Yamamah deal, there has been a team of UK civil servants supporting Saudi arms sales. Now known as the Ministry of Defence Saudi Armed Forces Project, it employs 200 civilian and military staff in the UK and Saudi Arabia. All the costs £41.8 million in 2007-8 are met by the Saudi government. In other words, UK public servants are being paid by an overseas government to work on a project that benefits a private company.

...and export credits
Following a CAAT FoI request, the Export Credits Guarantee Department has agreed to reveal how much cover is given to BAE’s Saudi arms deals in its annual reports. This cover is taxpayerbacked insurance that would pay out if BAE was not paid by the Saudis. It stood at £750 million at 31st March 2007 and the same a year later.

Nowhere to turn

Wherever BAE’s bosses turn, their reputation and relationship with government are under threat. Whether it’s the US, Switzerland, the OECD or the UK’s own media, BAE are faced with hostility and scrutiny. As we keep campaigning, public opposition to BAE’s privileged position and deadly trade can only increase. There is no way out for BAE.

UK Arms exports- the World's Number One?

tim — Wed, 27 Aug 2008 18:20:31 +0000

‘UK becomes biggest weapons exporter’, declared the Financial Times in June, triggering a flurry of media interest and a fresh flood of calls to the CAAT office. The Guardian ran the story in depth several days later. But any news involving both arms and statistics must be doubly suspect, so what’s the reality behind the headlines? In the complex world of arms orders, deliveries and licences, there are many and varied ways to calculate arms exports. However you do the sums, they nearly all show the USA to be the world’s top arms exporter, with the UK in the top five. One of the more simplistic calculations methods is simply to add up the value of orders within a given year – regardless of how long those orders take to deliver. In most years, the USA still comes out on top. But in 2007 the UK was pushed into the lead by one huge order – 72 Eurofighter aircraft to be supplied by BAE Systems to Saudi Arabia.

This is the infamous Al Salam deal (it means ‘peace’ in Arabic – feel free to laugh). It was this deal that the Saudi regime threatened to cancel until the British authorities dropped a corruption investigation into BAE in 2006. When lobbying for an end to the investigation, apologists for the arms trade argued that the deal would create thousands of British jobs. Once the deal was signed in September 2007, BAE admitted that most of the jobs would not even be based in the UK. So Britain‘s role as ‘world’s top arms exporter’ is a temporary phenomenon, dependent on a questionable means of calculation. Nonetheless, the UK sadly retains a leading role in the arms trade, despite the growth in public opposition and the backlash triggered by the BAE scandal.

Outstanding?

When the figures were released, parts of the media asked whether British people should be proud of what trade minister Digby Jones called ‘this outstanding export performance’. I debated this question on BBC Radio Five Live with Ian Godden of the Society of British Aerospace Companies. With Saudi Arabia accounting for nearly half of the 2007 orders, many callers to the programme clearly felt uneasy about a trade that relies on the whims of a violent dictatorship. There can be no doubt that most UK arms exports still go to oppressive regimes or to countries involved in armed conflict or regions of tension.

I was challenged several times on the grounds that the arms trade supposedly brings benefit to Britain’s economy. The obvious answer is that arms companies in the UK are sustained by hundreds of millions of pounds in taxpayer-funded subsidies every year. Money is poured into research and development for the arms industry at a time when we desperately need to develop skills and technology to tackle climate change. And companies such as BAE have been cutting their UK workforces for years, shifting their focus to the USA but being quick to call themselves British when they want public support here.

Real security that really is sustainable

As Steven Schofield argues in CAAT’s recent report Making Arms, Wasting Skills, demilitarisation and an end to arms trade subsidies would provide the resources for major investment in renewable energy and the jobs and skills that would go along with it. This would place the UK at the forefront of real security and sustainable economics. Now that’s something of which we could all be proud.

SFO wins appeal in BAE-Saudi case

tim — Thu, 31 Jul 2008 12:54:04 +0000

The Law Lords have this morning upheld an appeal by the Director of the Serious Fraud Office (SFO) against the High Court’s ruling that he acted unlawfully in terminating a corruption investigation into BAE Systems’ arms deals with Saudi Arabia.

The appeal followed a High Court judgment in April that the SFO, acting on government advice, had dropped the investigation following lobbying by BAE and a threat from Saudi Arabia to withdraw diplomatic and intelligence co-operation if the investigation were not dropped. This judgment was in response to a judicial review brought by the Campaign Against Arms Trade (CAAT) and The Corner House.

Nicholas Hildyard of The Corner House said:

“Now we know where we are. Under UK law, a supposedly independent prosecutor can do nothing to resist a threat made by someone abroad if the UK government claims that the threat endangers national security. The unscrupulous who have friends in high places overseas willing to make such threats now have a ‘Get Out of Jail Free’ card – and there is nothing the public can do to hold the government to account if it abuses its national security powers. Parliament needs urgently to plug this gaping hole in the law and in the constitutional checks and balances dealing with national security. With the law as it is, a government can simply invoke ‘national security’ to drive a coach and horses through international anti-bribery legislation, as the UK government has done, to stop corruption investigations.”

Symon Hill of CAAT said:

“BAE and the government will be quickly disappointed if they think that this ruling will bring an end to public criticism. Throughout this case we have been overwhelmed with support from people in all walks of life. There has been a sharp rise in opposition to BAE’s influence in the corridors of power. Fewer people are now taken in by exaggerated claims about British jobs dependent on the arms trade. The government has been judged in the court of public opinion. The public know that Britain will be a better place when BAE is no longer calling the shots.”

CAAT and The Corner House will issue a more detailed statement following an analysis of the Lords’ judgments.

Victory in the Courts: BAE Saudi inquiry ruled unlawful

tim — Tue, 08 Jul 2008 00:06:16 +0000

The decision followed a legal challenge brought jointly by CAAT and The Corner House, a respected organisation that has worked on anti-corruption issues for many years. In a strongly worded judgment on 10th April, the Court described how BAE and the Saudi regime had lobbied Tony Blair and his ministers to have the investigation dropped. The judges went so far as to describe the Saudi threat as a ‘successful attempt by a foreign government to pervert the course of justice in the United Kingdom’.

The history

The legal challenge began sixteen months previously, at the end of 2006. At that point, SFO investigators had spent two and a half years delving into allegations that BAE paid multi-million pound bribes to Saudi princes to secure the arms deals known as Al Yamamah. In autumn 2006, the media reported that the Saudi regime was threatening not to sign a deal with BAE for Eurofighter Typhoons if the investigation was not stopped. Apologists for the arms trade appeared in the media to make wildly exaggerated claims about the number of British jobs dependent on the sale.

The investigation was terminated on 14th December 2006. Within days CAAT and The Corner House had instructed solicitors at Leigh Day & Co and barristers from Blackstone Chambers to begin a claim for judicial review. This is the process by which a court considers whether a public body has behaved unlawfully.

A long process followed, with moments of both joy and exasperation. BAE spied on CAAT and got hold of an email containing advice from our lawyers. A comedy gig organised by Mark Thomas, with comedians including Russell Brand and Ed Byrne, raised thousands of pounds for the legal challenge. We applied successfully for a Protective Costs Order, placing a limit on how much CAAT would have to pay if we lost the case. Our claim for judicial review was initially rejected, but in November the High Court gave permission for it to proceed. Finally, in February, the hearing took place.

Documents released during the hearing exposed the lengths to which BAE was prepared to go to stop the investigation. They revealed that the company had lobbied the SFO to have it dropped as early as 2005. At that point, the SFO told BAE quite clearly that commercial and political considerations were not valid reasons for stopping a criminal investigation. During the following year the SFO obtained access to Swiss bank accounts and Tony Blair was personally lobbied by the Saudi prince Bandar – an individual who was himself at the centre of the corruption allegations. As his threats included the withdrawal of cooperation over fighting terrorism, BAE and the UK government were able to use ‘national security’ as a fig-leaf to cover up their motivations.

Decision unlawful

Contrary to Blair’s claim to be protecting the UK, the High Court found that the UK’s adherence to the rule of law had been undermined by the decision to drop the investigation in the face of the Saudi threat. The judges, Alan Moses and Jeremy Sullivan, ruled that the SFO’s director ‘failed to appreciate that protection of the rule of law demanded that he should not yield to the threat’. They added that surrender to a threat ‘merely encourages those with power, in a position of strategic and political importance, to repeat such threats’. It was not the investigation, but the decision to cut it short, that had endangered national security.

The judges went on: ‘There is no evidence whatever that any consideration was given as to how to persuade the Saudis to withdraw the threat, let alone any attempt made to resist the threat’. They then moved on to a vital point about motivations: ‘Too ready a submission may give rise to the suspicion that the threat was not the real ground for the decision at all; rather it was a useful pretext. It is obvious, in the present case, that the decision to halt the investigation suited the objectives of the executive. Stopping the investigation avoided uncomfortable consequences, both commercial and diplomatic.’

The judgment was welcomed by a wide range of newspapers (see page 12), politicians from all the main parties and others. Messages of congratulation flooded in to the offices of CAAT and The Corner House, by post, email and phone. The Government and BAE were alarmed. Clutching at straws, several right-wing columnists – who sixteen months before were confidently predicting that our challenge had no chance of success – suddenly revived their commitment to British jobs. Their claims were even less believable this time. BAE has already admitted that most of the jobs created by its latest Saudi deal will not even be based in the UK. Lord Woolf’s report into BAE’s ethics was greeted with similar derision for its failure to consider some of the most basic ethical issues about the arms trade (see page 3).

Government to appeal

The Government almost immediately announced its intention to appeal against the decision. The appeal will be heard by the House of Lords on 7th and 8th July. Considering the questions raised by the case to be of general public importance, the High Court has ordered the Government to pay all the costs both for the case so far and for the appeal regardless of the outcome.

The High Court’s decision means that the investigation is technically reopened. However, the new director of the SFO, Richard Alderman, has said that he will make no decision in practice until after the House of Lords has ruled on the appeal.

Regardless of the outcome, the political repercussions of the High Court victory should not be underestimated. The arms industry in the UK is struggling to get used to the fact that it can no longer expect to have everything its own way. Ministers know that their subservience to arms dealers is coming under greater public scrutiny. BAE has discovered that it cannot always bully its way to the desired result and the Saudi regime has realised that the British people do not share their Government’s willingness to submit to human rights abusers.

Just as importantly, public and media awareness has shot up on the issue of arms companies’ influence in the corridors of power. People from all walks of life are determined to campaign against this situation, recognizing that it is as harmful for the UK’s democracy and economy as it is for international peace and security. And more people than ever are now aware that CAAT is a key organisation working to change this situation.

One more thing is very clear. While staff at CAAT and The Corner House, along with our barristers and solicitors, have worked extremely hard on this case, we could not have done it with out the encouragement and help of thousands of supporters. Countless individuals have made donations to CAAT, lobbied their MPs, written to their local papers and gone out on to the streets to promote the campaign. Many have offered encouragement that has kept the staff going at the most difficult times. Our success would not be possible without them. This, then, is a victory for every CAAT supporter and for everyone committed to justice, accountability and peace.

Unfair Trade

tim — Wed, 07 May 2008 13:02:29 +0000

As the AGM of BAE Systems takes place in London today, the company’s supporters will again pop up in the media to trot out the usual phrases about “living in the real world”. In reality, it is these very supporters of the arms trade who display staggering levels of naivety.

This became very clear last month, at the time of a landmark High Court ruling in favour of the Campaign Against Arms Trade (CAAT) and The Corner House. The judges ruled that the government had behaved unlawfully in cutting short a corruption investigation into BAE’s Saudi arms deals. Among the congratulatory messages which flooded into the CAAT office were a few abusive ones and the odd death threat. But one message left on my phone began: “I’m a member of the British public and I live in the real world.” The anonymous caller claimed that were “thousands of British jobs” dependent on Saudi arms deals.

His comment was typical of people who believe that it is naive to oppose the arms trade but who simply accept assertions about employment figures without scrutiny. Such scrutiny is vital to those of us who believe that everybody’s livelihood is extremely important. As a child in the early 1980s, while my unemployed father quite literally got on his bike to find work, I experienced the realities of unemployment far more closely than most of those who are willing to make questionable claims about jobs to claw back public support for BAE – such as Norman Tebbit in the Daily Mail recently.

This sight was common in 2006, when BAE was lobbying for the Saudi corruption investigation to be dropped. BAE’s supporters rushed onto radio and television, pausing only to pluck random figures from the air. A report by arms companies had previously suggested that BAE’s latest Saudi arms deal might create 11,000 jobs across the whole of Europe. By November, BAE was citing the figure of 16,000 British jobs, while the figure of 50,000 regularly appeared in the media.

After the investigation was dropped, and the deal signed, BAE admitted that most of the jobs would not even be based in the UK. Saudi Arabia was to receive 72 Eurofighter aircraft, the first 24 of which had been intended for the RAF, who now have to take second place; so much for British jobs and national security.

BAE is keen to present itself as good for Britain, having reacted to the recent bad publicity with an advertising campaign covered in union flags. This is rather rich, given that BAE is developing away from the UK. George Bush’s aggression in Iraq and Afghanistan has created countless business opportunities for those who profit from war and BAE now has more staff and shareholders in the USA than in the UK.

Far from enhancing our country, BAE has weakened it. In the High Court last month, judges found that the BAE investigation had been dropped following a Saudi threat. They described this as a “successful attempt by a foreign government to pervert the course of justice in the United Kingdom”. Giving the impression that Britain will give into threats sends an appalling message to terrorists.

Most of all, BAE’s supporters are naive about the arms trade itself. I have lost count of the times that I have been accused of opposing arms deals “even when countries need arms for self-defence”. This displays an utterly unrealistic perception of what the arms trade is about.

The main players in the arms trade are often those using weapons for aggression and repression. Indonesia has been a good customer of BAE, not the people of West Papua who have they so easily bombed. Morocco and China both appeared at the DSEi arms fair in London last year, but no representatives from the Western Sahara or Tibet. People suffering aggression are victims of arms companies, not their customers.

Sometimes the attitude of arms trade supporters goes beyond naivety. Some suggest that corruption is a western concern and “they play by different rules to the ones we stand by here”. This ignores the reality that when bribery leads to ministers wasting public money on arms they will not use it to provide health care or tackling poverty. The victims of bribery are the poorest people in the poorest countries.

Yet people here in Britain are also victims of the arms trade. The unhealthy influence of arms companies over government distorts democracy and leads to about £850m of taxpayers’ money being spent every year on subsidies for the arms trade, although only 0.2% of UK jobs depend on it. In these circumstances, it is no surprise that BAE can boast about how many engineers it employs. I am often told by engineering students that their career prospects will be severely damaged if they are not willing to work in the arms trade.

Is this where British taxes and British skills should be going? Future generations may not understand why we chose not to subsidise the engineering needed to tackle the unprecedented horrors of climate change but to assist the sale of weapons to dictators. They will think that anyone who thought this would help Britain must have been shockingly naive.

The world in which supporters of the arms trade live is not based on reality, but on fantasy. It is a world straight out of 1950s boys’ adventure stories. It is a place in which honest British arms companies work hard to provide jobs and to sell arms to grateful democracies in need of self-defence. It is a world in which any British company engaging in bribery would do so reluctantly and only because you can’t expect foreigners to live up to our standards. It is based in a fictitious Britain in which millions of people work in the arms trade and climate change isn’t real.

This is a world as real as Narnia and most British people know it. They would rather see their taxes used for health and education, just as many engineering graduates would rather use their skills to fight climate change. They know that corruption kills, that the arms trade fuels aggression and that arms trade bosses are moved to emotion not by the union flag but by profit graphs.

A dwindling minority of people – among them a disproportionately high number of politicians and columnists – still remain oblivious to this. After a year which has seen an unprecedented rise in public opposition to the arms trade, it’s time for such people (as they would put it) to move into the real world.

Guarding the Gunrunners

Tim Holmes — Mon, 10 Sep 2007 22:46:58 +0000

In recent weeks, horrifying reports of gun crime have, understandably, been increasing the fear of guns among the British public. Next week, the Metropolitan police will also have guns on their minds. They will be guarding people selling them.

From September 11-14, about 1,000 officers per day will be policing Defence Systems and Equipment International (DSEI), one of the world’s largest arms fairs. It will take place at the Excel Centre in east London, with more than 1,000 arms companies selling weapons ranging from handguns to fighter jets. When DSEI was last held, it cost taxpayers over £4m in policing costs.

The UK government has an inclusive attitude to DSEI: regimes who abuse human rights are happily allowed in. Previous guests included Indonesia, Libya, Israel and of course Saudi Arabia – the tyranny of choice for the UK’s largest arms company BAE Systems. India and Pakistan both attended DSEI in 2005 – where they could buy weapons to aim at each other. While this year’s guest list is still to be released, we can be sure that despotic regimes are likely to return.

But don’t be fooled into thinking that nothing has changed. While the ethics of arms companies are no different, the attitudes of society certainly are. Arms traders are coming to London in a year that has seen political and commercial support falling away from the arms trade in the UK. This has led to DSEI’s owners attempting to sell it.

DSEI is one of several arms fairs owned by Reed Elsevier, best known as a publisher. In June, Reed’s bosses bowed to pressure from their authors and shareholders and agreed to sell their fairs by the end of 2007. They are looking for a buyer, but who will buy DSEI? Any business not deterred by ethics or reputational damage was put off in July when Gordon Brown announced the closure of the government unit that helps to organise DSEI. This is the infamous Defence Export Services Organisation (DESO), which acts as a marketing agency for private arms companies. Its closure has long been a key aim of the Campaign Against Arms Trade (CAAT).

The closure of DESO was a heavy blow to the arms companies, with BAE described as “furious“. Reed’s decision to sell DSEI is a major sign that participation in the arms trade is no longer an option for any business concerned about its reputation. Businesspeople have insisted that Tony Blair’s decision to cut short a corruption inquiry into BAE has harmed the reputation of British business. CAAT’s campaign to have the inquiry reopened has won support from across the political spectrum, due to public anger at BAE’s undemocratic power. The Local Authority Pension Fund Forum is questioning arms companies about ethics. Axa and Hermes have declared that they are withdrawing from large arms companies involved in cluster munitions. Buying an arms fair in this climate would be like buying a dairy farm in the middle of the foot-and-mouth outbreak.

And yet somebody, somewhere may well be considering it. The crucial question may be whether the government would be willing to subsidise DSEI through other departments once DESO closes in December. People from all walks of life will therefore be demonstrating against DSEI at CAAT’s peaceful demonstration on Tuesday. Together we will call on businesses not to buy DSEI and on government to find better uses for taxpayers’ money.

The arms dealers would like you to believe that the people protesting against DSEI are extremists. We are not. We are ordinary people who see how the arms trade fuels war, poverty and repression. We can see that DSEI is a threat to our security and a drain on our economy. And we would much rather see 1,000 police officers tackling gun crime instead of guarding gunrunners.

Dirty Deals and Bribes

Tim Holmes — Sun, 08 Jul 2007 18:41:16 +0000

Public opposition to the arms trade has risen sharply in Britain, largely in response to a never-ending stream of scandals surrounding BAE Systems.

The scandals exposed in recent weeks are the latest in a saga that has run for several years. Britain is the world’s second biggest arms exporter and BAE is its largest arms company. BAE has always been unpopular, but criticism reached boiling point at the end of 2006.

The Serious Fraud Office (SFO) was investigating allegations that BAE engaged in multimillion pound corruption, bribing Saudi princes with luxury cars, hotel rooms and prostitutes to secure a massive arms deal known as al-Yamamah. Last autumn, the SFO sought access to Swiss bank accounts and the media reported that it was close to a breakthrough. BAE’s bosses saw their privileges and profits under threat.

That all changed on 14 December, when Attorney General Peter Goldsmith announced the investigation had been dropped. Tony Blair defended the decision, saying the inquiry would harm British-Saudi relations. He did not mention the Saudi regime’s record of torture, sexism and persecution of religious minorities, or refer to the power BAE has over the British government.

BAE is not simply one more unethical multinational. Some would say it is in the premier league of powerful businesses in Britain. But this is not really true. BAE is the premier league.

Former foreign secretary Robin Cook wrote that BAE’s bosses “appeared to have the key to the garden door at Number 10”. He never saw Blair take any decision to BAE’s disadvantage. Although only 0.2 percent of British jobs depend on arms exports, the arms industry is subsidised with more than £850 million a year in taxpayers’ money. Many consider this goes to the core of the real motivation for curtailing the corruption inquiry.

Through public practices and private manoeuverings arms companies have crept ever further into the heart of government. The Defence Export Services Organisation (DESO) is an arms marketing agency run by the Ministry of Defence (MoD). It gives private arms traders unparalleled access to ministers.

It is even reported that DESO boss Alan Garwood will return to his old company BAE after leaving DESO this year – a blatant example of the revolving door that also allows former ministers to move to senior roles in the arms industry. It came as no surprise when the defence secretary admitted that BAE’s chief lobbyist had been issued with an MoD pass. This incestuous relationship has made it normal to put arms dealers’ wishes ahead of any other interests.

With the suspension of the inquiry, the influence of arms companies has been put on display and BAE’s bosses have been exposed to the greatest threat of all: public opposition.

Since the inquiry was dropped, the Campaign Against Arms Trade (CAAT) has been flooded with messages of support. Over 130 NGOs have called on the government to re-open the inquiry. The Organisation for Economic Cooperation and Development has questioned the government’s behaviour and launched an investigation into how the inquiry was dropped.

Over 100 MPs have signed an Early Day Motion (a sort of parliamentary petition) calling for the inquiry to be re-opened. In May, BAE’s bosses faced public anger both inside and outside their AGM. Journalists continue to unearth fresh material that makes the need for an inquiry obvious.

One of the most exciting developments is the judicial review being sought jointly by CAAT and the Corner House, an anti-corruption NGO. They aim to see a court declare the decision to curtail the inquiry unlawful.

CAAT believes the arms trade is not a legitimate business that has been the subject of abuse, but an industry whose very purpose is to profit from death and poverty. It argues that people in Britain can have a huge impact on the world by ending Britain’s role in the trade. The most effective way to do this is to break the relationship between arms companies and government.

CAAT is confident the campaign to reopen the BAE-Saudi corruption inquiry can make this hope a reality.

For more information, or to join the campaign, go to www.caat.org.uk or phone 020 7281 0297.