Parliament systematically misled by government over arms industry corruption

20 June 2005

A report published today by Campaign Against Arms Trade reveals that as long ago as the mid 1960s the UK Government knew that the arms industry was riddled with corruption. However it concealed, and continues to conceal, this from Parliament and the public. The report demonstrates that instead of attempting to stamp out arms industry corruption, the Government has gone out of its way to turn a blind eye whilst continuing to lavish political and financial support on arms sales.

The report is based on original research carried out in The National Archives which provides hard evidence of official knowledge of corruption in arms deals in Venezuela and Indonesia in the 1970s. Documents show that officials at the highest level were at pains to turn a blind eye and devise guidelines to avoid addressing the issue, even allowing publicly-owned companies to continue employing "agents" with no questions asked about their activities. The report exposes the MoD's misleading of MPs in recent statements in Parliament and puts the Export Credits Guarantee Department's willingness to water down anti-bribery procedures following pressure by BAE Systems, Rolls Royce and Airbus in May last year in sharp perspective.

The author, Nicholas Gilby, said "the Government's record on arms trade corruption is shameful. For decades hundreds of millions of pounds of public money has been used every year to underwrite corrupt arms deals and to promote a corrupt arms industry. It is high time this was stopped and serious Government action against bribery taken. As a minimum first step, the ECGD should reinstate its May 2004 anti-bribery procedures and the Government should put resources into investigating allegations of corruption and prosecute those cases where there is evidence."

ENDS

For more information please contact: CAAT Press Office on 020 7281 0297

NOTES

1. The report and a number of The National Archive documents are available on the CAAT website.

2. The arms industry is the most corrupt legal sector of the economy. In the late 1990s the CIA is reported to have estimated that the arms trade accounted for 40-45% of the total corruption in world trade despite only amounting to less than half a per cent of the total trade [see Joe Roeber article]. This corruption doesn't just result in incidental back-handers, it provides a motivation for buyers to inflate the size of the arms deals, leading to increased arms production and proliferation.

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