Blair's secret talks for £40bn Saudi arms deal revealed; research shows wider web of arms companies' political influence

27 September 2005

An extensive network of political influence wielded by arms companies over New Labour policy-making is highlighted by new revelations that Tony Blair has held secret talks with Saudi Arabia in pursuit of a £40bn arms deal, against dissent from the Foreign Office and the Serious Fraud Office. Recent research by the Campaign Against Arms Trade has revealed the full extent of a wider web of civil service appointments, donations and advisory bodies. Through these connections arms companies exert an influence at the heart of government policy-making unmatched by any other industry, campaigners say.

It was revealed today (Tuesday) that on 2 July, en-route to support the UK's Olympic bid in Singapore, Tony Blair visited Riyadh to lobby for the Saudi purchase of Typhoon fighter planes manufactured by British arms company BAE Systems. A visit from Defence Minister John Reid followed. The Guardian (UK) reported that the deal is contingent upon the British government granting three political favours, including the deportation of dissident Saudi refugees in the UK, and the dropping of an ongoing Serious Fraud Office investigation into bribes allegedly paid by BAE Systems to members of the Saudi ruling family.[1] BAE Systems were also accused last week of paying over £1 million to former Chilean dictator General Augusto Pinochet.[2]

Mike Lewis, a spokesperson for the Campaign Against Arms Trade (CAAT), said:

There could be no clearer indication of the disproportionate and undemocratic political weight wielded by arms companies within Downing Street and the MOD than Blair's central role in brokering an arms deal involving one of the world's most repressive regimes and BAE Systems, a company currently mired in corruption investigations involving that very regime. Number 10 even appears to have ignored the Foreign Office's fears about Saudi Arabia's political instability, and the Serious Fraud Office's concerns about Saudi-BAE corruption. It's time to get the gunrunners out of Whitehall.

Who Calls the Shots?

CAAT's research briefing, 'Who calls the Shots?', details seven mechanisms through which arms companies enjoy unique access to New Labour policy-making. These include:

  • A 'Revolving Door' between employment in arms companies and the Government, party, influential peerages, and the civil service. The Advisory Committee on Business Appointments last year criticised “a 'traffic' from the [Ministry of Defence] to the defence contractors who supply it” [3]. This 'traffic' extends to Downing Street. The Guardian has alleged that the new Saudi deal is being promoted by Jonathan Powell, Tony Blair's current Chief of Staff; and his brother Lord Charles Powell – former adviser to Margaret Thatcher, Tony Blair's 2001 envoy to Syria, and now a consultant to BAE Systems [4]
  • Arms company domination of unaccountable government advisory bodies. Of the government's four primary military advisory bodies, 55% of their members come from arms companies, 34% from government, and only 10% from elsewhere (including trade union representatives and academics) [5]

Arms companies have also provided substantial donations and corporate sponsorship to New Labour. Those who have provided substantial party funding since 1997 include: Raytheon Systems Limited, the world's largest missile makers; Bergmans, a lobbying company representing Lockheed Martin, Thales, Boeing, BAE Systems and GKN; BAE Systems representative Bell Pottinger; and military trade association the UK Defence Forum

The Saudi Connection

Government support for arms companies' private interests, much of it focussed on Saudi Arabia, include:

  • An entire Ministry of Defence [MOD] department, the Defence Exports Services Organisation (DESO), devoting 450 civil servants solely to promoting private arms exports. DESO's current head, Alan Garwood, is seconded from a BAE Systems company. Uniquely, his civil servant's salary is 'topped-up' by the National Defence Industries Council, an arms trade body.[6] 200 of DESO's staff work entirely on Saudi Arabia, including 54 British officials permanently based in Saudi Arabia. Earlier this month DESO invited arms buyers from 7 countries on the Foreign Office's own list of the world's top 20 human rights abusers to their DSEI arms fair in London, despite EU/UK arms export rules forbidding military exports to countries where they might be used for human rights abuse.[7]
  • Labour ministers' continued suppression of a 1992 National Audit Office report into corruption allegations surrounding the £8bn Al Yamamah arms deal between the UK and Saudi Arabia. In 2003 Defence Minister Adam Ingram re-iterated the 1992 refusal by the chair and deputy chair of the Public Accounts Committee - for whom the report was produced - to release the report even to the rest of the Committee.[8]

CAAT's 'Who Calls the Shots?' report can be downloaded here (pdf, 450kb). Part 2 of the 'Calling The Shots' research programme, investigating the role of DESO, will be published in early 2006.

Notes
  1. D. Leigh & R. Evans, 'Saudis link £40bn arms deal to call to expel dissidents', The Guardian, 27 September 2005. Saudi Arabia was named amongst the Foreign Office's top 20 'Countries of Major Concern' in their 2005 Human Rights Report, which stated that “the Saudi government has continued to violate human rights”.
  2. www.guardian.co.uk/chile/story/0,13755,1570335,00.html
  3. The Cabinet Office, Advisory Committee on Business Appointments, Sixth Report 2002-2004, p. 10
  4. See Lords Register of Interests
  5. These four quangos are the National Defence Industries Council, the National Defence and Aerospace Systems Panel, the Aerospace Innovation and Growth Team, and the Defence Export and Market Access Forum.
  6. Defence Minister Adam Ingram, Answer to Parliamentary Question, Commons Hansard 12 Jul 2005 Col. 861W
  7. See CAAT's 12 September 2005 press release. For EU/UK Export rules, see UK Strategic Export Controls Annual Report 2004, Annex F: www.fco.gov.uk.
  8. Defence Minister Adam Ingram, Answer to Parliamentary Question, Commons Hansard 12 September 2003 Col. 735W
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