New Statesman & Society leader, 16 June 1995
Michael Heseltine has struck a welcome blow for Lord Justice
Scott's inquiry into arms sales to Iraq
"I was not briefed on this contract at any time during
my non-executive directorship," Chief Secretary to the Treasury Jonathan
Aitken told the House of Commons in March after documentation emerged proving
incontrovertibly that BMARC, an arms company of which he was a director, had in
the late 19805 sold naval guns to Iran, exporting them via Singapore to get
round the government's ban on arms sales to Iran or Iraq. The exercise was
code-named "Project Lisi" by the company, and it was discussed at
board meetings at which Aitken was present. "Seven years after the
event," he said in March, "I have no recollection of ever having
heard about Project Lisi or read about it in company reports."
This week, it became clear that, even if Aitken knew
nothing, the British intelligence services knew plenty. President of the Board
of Trade Michael Heseltine stunned the Commons by announcing that, as early as 1986, "intelligence was obtained" that
Oerlikon, BMARC's Swiss parent company until BMARC was sold to the British firm
Astra in 1988, had concluded a contract with Iran. "The intelligence
picture developed in 1987, when it was revealed that naval guns made by Oerlikon
had been offered to Iran by a company in Singapore. In July and September
1988, two intelligence reports rounded out the picture by referring to naval guns
and ammunition being supplied by Oerlikon through Singapore to Iran."
And yet BMARC continued to be granted permission by the
Department of Trade and Industry to export guns to Singapore. The intelligence
reports were apparently not passed on to the DTI, and even if they had been
it's a moot point whether anyone would have taken any notice. The DTI Export
Licensing Department was in the habit of granting military export licences
without full documentation. Between 1986 and 1989, said Heseltine, 74 per cent
of military export licences were granted without all the relevant papers being
presented.
Aitken is sticking to the line that he knew nothing about
Project Lisi, which, although even less credible than it was in March, is
hardly surprising. Whether it saves his skin is another matter entirely. The
chief secretary cannot escape the foul stench of dishonesty and graft that
clings to him, and both he and his loyal colleagues know that it will not take
many more revelations for his political career deservedly to be cut short.
But this is only a small part of the story. Far more
important than the impact of Heseltine's statement on the fate of Aitken is its
devastating effect on the attempt by several prominent Tories to rubbish Lord
Justice Scott's inquiry on the sale of arms to Iraq. The clear implication of
Heseltine's announcement that three-quarters of military export licences were
granted without proper documentation is that there was a policy in the late
1980s of allowing just about anything to be sold to just about anyone – regardless
of formal restrictions either secret or publicised. It is difficult to think of
a more effective way of silencing those Tory politicians who have seized on the
occasion of a couple of pre-publication leaks of Scott's long-delayed report to
bleat about the unfairness of the inquiry procedures and to claim that Scott
had exceeded his brief. After Heseltine's statement this week, the problem
seems to be that, in concentrating just on Iraq, he has not cast his net widely
enough. Indeed, we need nothing short of a full-scale independent public
inquiry into the whole of Britain's arms export business.
Of course, Heseltine has his own reasons to give Scott a
boost. Alone among senior Tories in the current government, he has nothing to
lose over the arms-to-Iraq affair. Unlike John Major and Douglas Hurd, he
cannot have his competence or integrity called into question over his handling
of exports to Iraq in the late 1980s: he was out of government at the time. And
unlike Kenneth Clarke, he participated only unwillingly in the bodged cover-up
of issuing Public Interest Immunity certificates to prevent a fair trial of the
defendants in the Matrix-Churchill case.
But even if Heseltine is using the arms sales scandal in his
campaign to seize the keys of Number Ten in the autumn, we should be grateful
for his intervention. The attempt of the guilty men – notably William
Waldegrave and Geoffrey Howe – to cast aspersions on Scott's methods and
competence has been shameful. Any blow against their cynicism has to be
welcome, even if it is delivered from the basest of motives.
