The Corruption of New Labour: Britain’s Watergate?

[Maggie Hansen]

...It just shows that we will not deal with the subject of corruption in politics until we abolish the House of Lords. How can you have a democratic system when the rich can buy their way into the legislature.

I agree with you John that the House of Lords should be abolished. It is an insult to democracy. But don't you think that the rich will buy their way into any system?

[John Simkin]

Last week the High Court ruled that Tony Blair and other senior politicians should disclose expenses claims that they have been fighting to remain a secret. According to today's Sunday Times, Blair has admitted that some of these documents concerning his Myrobella home have already been shredded. The destruction of these documents took place after the Sunday Times made a Freedom of Information request in January 2005 for details of the expenses claimed over his Myrobella home. This is a clear case of obstructing the FOI Act and hopefully it will be fully investigated.

Gordon Brown is another one who has been ordered to publish details of his expenses claims. I wonder if he has shredded these documents as well.

It is believed that while these politicians were claiming expenses for their second homes they were sub-letting them and not declaring the income.

[John Simkin]

Last week the High Court ruled that Tony Blair and other senior politicians should disclose expenses claims that they have been fighting to remain a secret. According to today's Sunday Times, Blair has admitted that some of these documents concerning his Myrobella home have already been shredded. The destruction of these documents took place after the Sunday Times made a Freedom of Information request in January 2005 for details of the expenses claimed over his Myrobella home. This is a clear case of obstructing the FOI Act and hopefully it will be fully investigated.

One of the reasons why Blair fought to keep this information out of the public domain is that these documents show that he was claiming his £90,000 mortgage on the Myrobella home as part of his second-home expenses. However, Cherie Blair disclosed in her recent autobiography that they initially bought the home for £30,000. He obviously got a second mortgage on the property as part of a tax fiddle.

[John Simkin]

There is an interesting article in the current LOBSTER written by Sebastian Cody on the book about the death of Dr. David Kelly by Norman Baker, MP "After Dark".

Two points grabbed my attention.

1. Baker raised the question of Tony Blair's support for Bush over Iraq:

Baker asks if the UK supported the US because the 'White House held information on Blair so incriminating that its release would have caused immediate resignation', a remark he later amplifies with the "wild" report that 'the Americans were ware of a deeply personal scandal involving Blair dating from the 1980s'."

There is then mention of a 45 foot radio antennae put up in Kelly's garden after his body was discovered, with the observation that this was too big for normal communication requirements but would fit the bill if it was intended to keep in communication with an aircraft a very long way away, so as the one carrying the prime minister from Washington DC to Tokyo.

2. There then follows a curious discussion about knowledge of involvement of a member of a paedophile network in the Hutton inquiry"

Another hint to what Baker thinks the key players were really up to is contained in his observation that the appendix to Hutton contains a document about "The World's Worst Paedophile Ring", whose members, some correspondent claims, were present at Kelly's murder. Baker wonders why this particularly wacy document was included when, presumably, many other such communications were not - and we may in turn wonder why Baker refers to it at all. Baker has his reasons - and suddenly the shadows of old stories familiar to Lobster readers fall over the the book as Baker reports hat he has been told:

'a leading figure in the Hutton inquiry process was known by he government to have had a paedophe past in a part of the UK well away from London. Was the inclusion of this particular document a way of reminding him to "do his duty"?'

I wonder if John, who was working with Baker on his investigation, has any insights. Can it be that the two separate points are connected?

The mind boggles, but it would not be the first time a post WWII prime minister and, for that matter, a home secretary were tagged as being involved in a paedophile ring.

The "well away from London" reference probably is a reference to the Northern Ireland Kincora Boys Home scandal which included visitations by said former prime minister and (as I recall) said home secretary.

Owning the political leaders of nations via blackmail means having willing allies all over the world...

Norman Baker relied heavily on whistleblowers for his investigation into the death of David Kelly. Most of these people were not named in his book. Nor did he provide information that enabled them to be identified. There is no doubt that they feared for their lives. Norman, rightly, never shared these names with me. Just before the book was published he asked me if I was willing to be named. I agreed to this because I did not feel that I was in any danger, but most said no.

Some of these informants were from the intelligence services. I warned him that some of these might have been disinformation agents. He agreed that this was possible but like all researchers he ended up making his own judgement about what information was true and what was disinformation. He came to the conclusion that Kelly was killed by agents of Saddam Hussein. I disagreed with this theory but I never spoke to these informants.

We both took the view that Blair was being blackmailed by the CIA. It is difficult to know what the CIA had on Blair. My best guest is that CIA had evidence that Blair joined the Labour Party and CND as a MI5 spy. This is the sort of information that MI5 would have passed on to the CIA.

I am not aware of Blair being involved with a "paedophile ring". It is of course possible. I know that a former Home Secretary in the Thatcher government was forced to resign because of his interest in young boys. If Blair had visited the wrong websites the CIA and MI5 would no doubt have the details. I suspect that several MPs have been turned in this way.

[John Simkin]

It was revealed over the weekend that Ray Ruddick was the third biggest donor to the Labour Party this year. Ruddick is a builder who lives in an ex-council house. When he was interviewed by journalists he said he hated the Labour Party and therefore did not give the money. Janet Kidd, the fourth largest donor, refused to answer the journalist questions. Like Ruddick, Kidd is another one who appears not to have very much money. However, Ruddick and Kidd do have something in common, they do work for property developer, David Abrahams, a very wealthy businessman who funds pro-Jewish causes.

Last night Abrahams admitted that he gave money to Ruddick and Kidd and they decided to donate the money to the Labour Party. That was clearly a lie and later he changed his story to say that he did it this way because he did not want any publicity. Of course, he didn’t, the money was obviously a backhander in order to get some land released for building purposes.

I see that detectives investigating "disguised" donations to the Labour party have handed their main file of evidence to the Crown Prosecution Service. A decision will now be taken as to whether there is sufficient evidence to charge anyone. Although Peter Watt has admitted knowing that intermediaries were illegally being used I doubt if anyone will be charged with any offence. It seems that it is impossible to get a conviction against a senior member of the Labour Party when it is the government of the day. Bit like Italy really.

See this story:

http://www.guardian.co.uk/world/2008/jun/28/italy1

[John Simkin]

Members of the Labour government have constantly argued that there is no connection between donations to the party and government contracts because it is senior civil servants who make the relevant decisions on these matters. It is therefore important to show how these civil servants are rewarded.

For example, Accenture was established in 2001. It was not long before the company was getting large government contracts. This includes a £650m “e-border” contract to a consortium that includes Accenture.

Over the last couple of years the Cabinet Office has spent an estimated £200,000 a year on Accenture consultants. Gill Rider is director-general of personnel in the Cabinet Office. Officially she earns £180,000 a year. It was recently revealed that Rider has 31,000 shares in Accenture that have a value of £4.6m. It has also been disclosed that she has already cashed-in Accenture shares worth £5m. I wonder if she purchased these shares at the market-rate? Did she buy them before or after Accenture got the contract?

Tim Gbedemah, director of the border and immigration agency at the Home Office, has a shareholding at Accenture worth £10.3m.

James Hall, the chief executive of the Immigration and Passport Service (IPS) at the Home Office, recently sold £8m worth of shares in Accenture. Hall is a close friend of Lis Astall, managing director of Accenture and was a guest at her holiday home in the Balearic Islands last month. According to the Accenture website: "Lis Astall says she learned that there's no need to be competitive and race for promotion, having found that there were many people supporting her career path and professional growth."

Bill Crothers, another official at the IPS, recently sold Accenture shares worth £4.2m.

I wonder how much of this money is fed back to people like Tony Blair and Gordon Brown?

[Robin Ramsay]

It is difficult to know what the CIA had on Blair. My best guest is that CIA had evidence that Blair joined the Labour Party and CND as a MI5 spy. This is the sort of information that MI5 would have passed on to the CIA.

As for the story about Blair being recruited to spy on CND - I have never understood what 'spying on CND' would entail. It was a public body, its offices were open to all. You could just walk in. What was there to spy on? Blair joined CND because, as a careerist he did whatever would make him acceptable to the powers-that-be. At the time the anti-nuclear thing in the Labour Party had the support of a majority of the party. Blair, as far as I can tell, never believed anything much and, according to one of his former law colleagues, would have joined the Tory Party had he not perceived that it took a long time to reach the top of that party. He correctly perceived that in Labour a good-looking young barrister would go far and quickly. He just wanted to be a big-I-am, something he has achieved in spades. I seem to recall that the Blair-MI5 story came from David Shayler. It might be true that Blair talked to one of the MI5 officers who sniffed round the Labour Party. I imagine that at the time, with the left-right conflict at full bore, lots of right-wing Labour MPs talked to MI5 officers, or to people who talked to MI5 officers (such as journalists).

Blair's foreign policy doesn't need explaining. He did what Uncle Sam wanted (with God's support, apparently) and he persuaded himself that he was doing good. So-called 'liberal interventionism', which Blair tried to practice, is merely the latest in a long line of cover stories, rationalisations for American imperialism (with Uncle Sam's little chum, the UK, tagging along). What else needs explaining?

[John Simkin]

On Wednesday the House of Lords yesterday ruled that the Serious Fraud Office acted lawfully when it halted its investigation into bribery allegations relating to an arms deal between Saudi Arabia and BAE Systems. Led by Lord Bingham, the members of Britain's equivalent of the supreme court overturned what had been an earlier landmark judgment by two of their high court colleagues, Lord Justice Moses and Lord Justice Sullivan. Moses and Sullivan had previously condemned the enforced closedown of the SFO investigation into the bribery allegations as a betrayal of the rule of law. The law lords contradicted them. They said the courts should stand aside, and had no power to interfere with the decision to shut down the investigation in the face of Saudi threats of retaliation.

Once again, the establishment joins forces to prevent politicians from being prosecuted for corruption. Since the Labour government passed a limited anti-corruption act in 2002, claiming to be conforming to an international anti-bribery convention, the SFO has not been allowed to bring a single bribery prosecution, let alone obtain any convictions.

Meanwhile, the US has been vigorously prosecuting companies under its Foreign Corrupt Practices Act, and both France and Germany have brought politically embarrassing cases against their household name firms of Total-Elf and Siemens. The arms company still faces a potentially dangerous investigation in Washington by the US department of justice. Half BAE's business is now done in the US, which it has identified as the weapons procurement goldmine of the future.

US investigators have been hamstrung by Britain's refusal to cooperate in their investigations, and by difficulties in obtaining access to the Swiss bank accounts, the prospect of disclosure of whose contents has so alarmed the Saudi royal family. But the US department of justice is proving harder to throw off the company's back than the British authorities.

[John Simkin]

One of his last policy moves before Blair left his post of prime minister was to promote the idea of nuclear power stations. Gordon Brown has followed in his footsteps. Another advocate is David Miliband, the man who is expected to depose Brown later this year. However, they are also in favour of a balanced approach with plans to build green power stations.

Miliband’s close associate and chairman of his constituency is Alan Donnelly. At one time Labour Party activists were trade union officials, teachers and social workers. New Labour activists tend to be involved in PR or lobbying. This is the case of Donnelly, who owns a lobbying company called Sovereign Strategy. One of the Donnelly’s clients is Helius Energy. It donated £4,000 to Miliband’s constituency (South Shields) to fund a dinner attended by Miliband, Sonnelly and two senior Helius Energy executives in April 2006. Three months later Helius announced its plans for a £200m biomass power station on the Humber estuary. Its application was submitted to the trade department. It was then passed to the environment department, which at that time was headed by Miliband. He recommended the project be approved. However, the Environment Agency objected because it was being built on a flood plain. Later, it was persuaded to withdraw its objection.

During this process Donnelly company, Sovereign Strategy, donated £1,500 to Miliband’s constituency and £35,000 to the Labour Party. On its website it boasts that the company offers “pathways to decision makers in national governments” and lists as its clients Bernie Ecclestone, the boss of Formula One, whose £1m donation to Labour was linked to the government decision to exempt the sport from a ban on tobacco advertising.

In June, 2008, Malcolm Wicks, the energy minister, gave permission for the powermass power station to be built by Helius Energy.

[John Simkin]

It seems that there is an attempt overthrow Brown. However, this is a squabble between different factions of New Labour who believe the current leader crisis is about personality and presentation. These politicians are living in “cloud cuckoo land”. The unpopularity of Brown is based on the view that the electorate do not like the policies of New Labour. They also dislike the way that the party is being run. For example, this year’s Labour Conference will be the first in its history where delegates will not be allowed to vote on policy issues. New Labour is being run like the old Communist Party in the Soviet Union and the current Communist Party in China.

The real reason that Gordon Brown and his cronies in New Labour should be overthrown is because of the way they have been running the country. Brown is still claiming that the financial and banking disaster which now threatens the whole UK economy is caused by globalisation. It is in fact a specifically Anglo-American crisis, the product of many years of deregulation and dangerous banking practices invented when Reagan and Thatcher were in power. However, Blair-Brown, rather than tackling this problem when they took office, increased the momentum of this crazy policy.

Blair-Brown turned London into an offshore island for sheltering the worst of US banking practices and their non-dom tax-dodgers, and linking the UK inextricably to the sub-prime mortgage pyramid. Blair-Brown have encouraged the irresponsible policy of making credit freely available in order to grow the economy. That policy was not followed in other major economies other than the US. There is no financial meltdown in France, Germany or Japan.

The meltdown will continue for at least a year. Therefore, it is not wise to remove Brown until we get to the bottom of the recession.

[John Simkin]

One of the leading figures in the Blair-Brown New Labour Scandal has just resigned. Metropolitan Police Commissioner Sir Ian Blair has been involved in a series of scandals but up to now he has been protected by the New Labour government. Blair said he had lost the backing of London mayor Boris Johnson, who took over as chairman of the police authority on Wednesday.

MPA auditors are in the process of examining Scotland Yard contracts given to consultancy firm Impact Plus, run by a friend of Ian Blair.

There have been questions too about his handling of events surrounding the 2005 death of Jean Charles de Menezes, who was shot dead at Stockwell Underground station in south London after being mistaken for a suicide bomber. Although he lied about the incident he was protected by Tony Blair and his Home Secretaries. Why, because Ian Blair was in overall charge of the various investigations concerning the corruption of the Labour government.

[John Simkin]

After dithering for several weeks the collapse in bank shares has forced Gordon Brown into action. This morning the government has announced details of a rescue package for the banking system worth up to £50bn ($88bn). It will initially make the extra capital available to eight of the UK's largest banks and building societies in return for preference shares in them. The banks are resisting the prospect of the government taking control over these companies. They are frightened that the government will insist on controlling the scale of the renumeration of the leaders of these banks. Although in a strong position, the UK government is unwilling to take control of the banks. I imagine the reason for this is that Brown has been offered a generous position as a bank director when he is finally removed from office.

HBOS, Barclays, Lloyds TSB and RBS, the five failing banks, have issued statement welcoming the plan. The problem for Brown is that these measures will not work. The market has lost confidence in the banking sector and the FTSE 100 in London continues to fall.

John McDonnell, the Labour MP is one of the few politicians talking any sense about the crisis. He issued this statement this morning:

The government needs to act urgently to protect the British people against the economic turmoil that was not of their making, but is now resulting in them losing their jobs and struggling to pay their rent or mortgage and fuel bills. There should be no blank cheques to bail out the banks that contributed to this crisis.

We are calling upon the government to implement a people's programme to protect our people from the crisis, not just the bankers, including:

1) Nationalising the banks and establishing democratic control over banking decisions, ensuring democratic representation on boards, ending the bonus binges, controlling executive pay and shareholder rewards;

2) Cutting interest rates significantly and immediately, restoring democratic control over key economic decision-making by not only widening the remit of the Bank of England beyond ensuring price stability to advising on the wider economic health of the country, but also reverting the Bank's role to being one voice among many others to be taken into account;

3) Securing people a home by converting repossessions to social rentals so that people have a "right to stay" in their homes and embarking on a massive council housebuilding programme;

4) Enhancing security in employment by ensuring people have a say over the future of the companies by strengthening rights and representation at work;

5) Bring fuel bills under control with price controls on the consumer price of gas and electricity, so that people are not being forced to choose between heating and eating this winter, with the threat of nationalisation if needed.

[John Simkin]

To create “New Labour”, Blair had to start removing the links with the trade union movement. Traditionally, the trade unions had been the main providers of money to the Labour Party. However, if Blair was going to this he had to find other financial backers. This became Sir Michael Levy’s job. However, the problem with obtaining large donations is that they always expect something back in return. Businessmen have always seen donations to political parties as an “investment”. Recently, there has been much speculation about this money being used to buy “honours”.

For example, all but one of Labour’s top donors who have given over £1m has received a peerage. The exception is Lakshmi Mittal, the steel magnate. He was rewarded in other ways - the Romanian steel contract. This is the reality of large political donations. The granting of honours is just a sideshow. It is the granting of other political favours that is the real scandal.

For example, soon after he was elected as prime minister, Blair announced that sport was being exempted from the ban on tobacco advertising. Everyone was surprised by this broken election promise until it was revealed that Bernie Ecclestone had given the Labour Party £1 million a few weeks previously.

It has always been a surprise to me that Tony Blair kept Tessa Jowell in his cabinet. Especially, when her husband, David Mills, was charged with being involved in Silvio Berlusconi’s corrupt activities in Italy. Rumours circulated that Jowell must have something on Blair. Jowell was removed from the cabinet as soon as Gordon Brown became prime-minister.

This morning it became clear what Jowell had on Blair. This dates back to Blair’s first “sleaze scandal” that took place five months after his 1997 election victory. Blair defended himself on television as a "pretty straight sort of guy" after the government announced proposals to exempt formula one from the ban on tobacco advertising on November 5 - three weeks after Blair met formula one boss Bernie Ecclestone and Max Mosley, president of the Fédération Internationale de l'Automobile (FIA), in Downing Street on October 16. Ecclestone had donated £1m to Labour in January of that year.

Blair was asked questions in the House of Commons about his matter. He told the Tory MP, Peter Luff, on 12th November, 1997: "It was a collective decision, made in the normal way. I met [Ecclestone and Mosley] on October 16. No decisions were taken then ... Finally, at the beginning of last week, there was the decision to seek a specific exemption for formula one."

Luff never believed this statement and over the last 11 years has been attempting to use the Freedom of Information Act to release the necessary documents that would support or disprove Blair's answers in the House of Commons. Today, the government released some of these documents. This includes a memo that show that the day after his Ecclestone meeting, Jonathan Powell, Blair's chief of staff, wrote to Tessa Jowell, then health minister, to say: "The prime minister would like your ministers to look for ways of finding a permanent derogation for sport, in particular F1."

Jowell wrote to Blair on October 24 setting out a series of options including an exemption. No 10 replied on October 29: "His [the prime minister's] view remains that we should seek to negotiate a permanent exemption for Formula 1, backed up by the voluntary agreement with the FIA."

It is clear the Blair misled (lied) in his answer to Luff. He comments this morning: "It now turns out that I was misled and the house was misled quite materially. I will be exploring with the Speaker what the appropriate steps are for the house to ensure its integrity is protected and the record corrected."

[John Simkin]

The most corrupt member of Tony Blair’s government was Peter Mandelson. Twice he was forced to resign from office. Gordon Brown has made the strange decision to bring back Mandelson into the cabinet as Business Secretary (although he has been wisely relieved of the brief to investigate business corruption).

Mandelson is currently under investigation by the European authorities. This involves his relationship with Oleg Deripaska, the owner of Rusal. Over the last three years, while working as European Union Trade Commissioner, he twice cut European aluminium import duties. Rusal, the world’s largest producer of aluminium, was the main beneficiary of this action.

Of course it is possible to bribe corrupt politicians with money that can never be traced. However, as Mandelson showed when he was in Blair’s cabinet, he is sloppy, corrupt politician. Mandelson has been found to have spent time on Deripaska’s luxury yacht. Not a wise move.

[John Simkin]

Peter Mandelson is a close friend of Nat Rothschild, who runs the hedge fund, Atticus Capital (worth $20 billion), and the heir to the Rothschild barony.

The two men spend quite a lot of time on Rothschild’s island of St Barthelemy. He especially likes to take trips on Rothschild’s private jet.

Another person who has provided Mandelson with free holidays is Lakshmi Mittal, the world’s fourth richest man. In 2005 Mittal gave Tony Blair’s New Labour government £2m. This was not the first gift that Mittal made to Blair.

In 2002 it was disclosed that Mittal's LNM steel company, registered in the Netherlands Antilles and maintaining less than 1% of its 100,000 plus workforce in the UK, sought Blair's aid in its bid to purchase Romania's state steel industry. The letter from Blair to the Romanian government hinted that the privatisation of the firm and sale to Mittal might help smooth the way for Romania's entry into the European Union.

In 2006, Mittal mounted a £12.8 billion hostile bid for its nearest rival Archelor, which was based in Luxembourg and France. At the time Atticus Capital had holdings in both Mittal Steel and Arcelor and wanted the deal to go ahead. However, in Luxembourg and France there was strong opposition to the deal.

Mandelson, as the European Union Trade Commissioner, came under pressure from Mittal and Rothschild to support the deal. He agreed to do this by speaking out in favour of open trade and against European opposition to the deal. Eventually, the EU competition commission eventually approved the deal.