UK: British 'Cash for Honors' Probe Ends; No One Charged

British 'Cash for Honors' Probe Ends; No One Charged

By Kevin Sullivan
Washington Post Foreign Service
Saturday, July 21, 2007; A09

LONDON, July 20 -- British prosecutors said Friday they would not charge anyone in a high-profile campaign finance probe in which former prime minister Tony Blair became the first sitting British head of government to be questioned by police in a criminal investigation.
The 16-month investigation turned up "insufficient evidence to provide a realistic prospect of conviction," said Carmen Dowd, a top Crown Prosecution Service official, closing out the "cash for honors" probe into allegations that Blair's government offered seats in the House of Lords and other perks in exchange for large loans to the ruling Labor Party.
The investigation was a significant factor, along with the Iraq war, in Blair's sharply declining popularity in the final year of a decade-long tenure that ended with his resignation last month. Blair, who was interviewed by police three times, consistently maintained that the allegations of sleaze in his administration were groundless.
Four people were arrested and released without charge in the matter, including Michael Levy, Blair's chief fundraiser, and Ruth Turner, a close aide to the prime minister. Blair's chief of staff and other top aides were also questioned as the investigation shifted to whether Blair aides had tried to hinder police.
Prosecutors said Friday that they had found no evidence of a coverup or attempts to block the investigation.
Blair issued a statement saying that the case had ended "as I always expected it would."
"Those involved have been through a terrible, even traumatic time," Blair said. "Much of what has been written and said about them has been deeply unfair, and I am very pleased for all of them that it is now over."
Levy, smiling broadly, told reporters, "I think my face tells how I feel."
The investigation began in March 2006 with a police complaint filed by Angus MacNeil, a Scottish National Party legislator, alleging that the Labor Party had agreed to nominate several people to the House of Lords, the upper house of Parliament, in exchange for loans to the party.
Labor acknowledged that month that it had received about $28 million in undisclosed loans from donors before national elections in 2005. The Conservative Party also acknowledged that it had received about $32 million in undisclosed loans before those elections, and the Liberal Democrats said they had accepted nearly $1 million.
Although the loans were legal and there was no requirement to disclose them, the news caused opponents to question whether donors had been offered favors. In the subsequent probe, police said that they were looking at all parties, not just Labor.
In their decision Friday, detailed in a nine-page written statement, prosecutors said that in October 2005 the Blair government nominated to the House of Lords four people who had lent money to Labor before elections the previous May. But prosecutors concluded that there was "no direct evidence" that the nominations were made in return for the loans. They also said that each person nominated "was a credible candidate."
"This whole affair has diminished politics and politicians in the eyes of the public," said Menzies Campbell, leader of the Liberal Democrats.
Tony Travers, a professor at the London School of Economics, said in an interview that Friday's decision "certainly removes part of the shadow from Blair's legacy." But, he said, the British public still has a "general sense of sleaze" in politics and "collapsed trust in the political system." Many Britons would probably view the prosecutors' decision not to file charges as a "whitewash," he said.
Vernon Bogdanor, a professor of government at Oxford University, said the episode proves the need for public financing of British political parties, which is minimal under current law. "As long as the political parties rely on handouts from millionaires, there are going to be problems," he said in an interview.
Bogdanor said Blair worked hard to reduce Labor's reliance on trade unions, which once provided more than 70 percent of the party's political funds.
Prime Minister Gordon Brown, speaking in Paris at a meeting with French President Nicolas Sarkozy, said he hoped the decision would end "months of speculation" and vowed to "move ahead" with campaign finance law reform, without offering specifics. Under Blair, the government closed a loophole that exempted loans from campaign finance disclosure regulations.



'Cash for honours' ends: the corruption begins

By Charles Moore
Last Updated: 12:01am BST 21/07/2007


From start to yesterday's finish, the cash for honours row has always been about timing. For the whole history of peerages - that is to say, for more than 700 years - money has tended to help when you want a title. It may be naughty, but it is not new.
Tony Blair was unusual - and foolish - to get so personally involved in these matters, but in essence he did nothing unique. Why, then, did the Metropolitan Police decide to step in early last year? Some hailed the police involvement as a sign that not every institution in our society was under the thumb of the Blair junta. To me, it marks the moment when that thumb slipped.
The other Blair in this saga, Sir Ian, is now and was then the head of the Metropolitan Police. After the police shooting of Jean Charles de Menezes at Stockwell Tube station in July 2005, Sir Ian's position became vulnerable.
Politically correct and politically astute, Sir Ian had devoted much time to expressing the right New Labourish sentiments at the expense of supporting his officers on the beat. His career had prospered. But after the July bombings, his language of appeasement no longer suited the grim mood. On his watch, more Londoners had been killed than in any terrorist incident ever. He could not now rely on the total support of Number 10.
A police investigation of the Prime Minister and his cronies was a guarantee of Sir Ian's job security. Number 10 could not push him out while Scotland Yard was probing them. The media, most of whom started life at Mr Blair's feet, had by now crawled up his body and found his throat. How they would have howled if the top copper had been removed at such a moment.
The police did not have to take seriously the obviously politically motivated complaint from an SNP MP that set their inquiry in motion. They could have taken refuge in the fact that Commons Public Administration select committee was looking into these matters. Instead of which, they effectively interrupted the committee's work.
Last November, deputy assistant commissioner John Yates wrote to the committee to explain why he was getting in their way. He spoke of "major developments". These have now vaporised.
By taking ages, conducting a dawn raid, arresting promiscuously and leaking dark suggestions of amazing evidence, the police gained control of the process. In a Blair versus Blair contest, it was Ian, and not Tony, who suddenly had time on his side.
You may remember that, although Tony Blair was very careful what he said in public about the case, the one thought he kept pushing was that he hoped the inquiries would end as soon as possible. He said this because he understood that, so long as they continued, he could not really run the country.
His opponents understood that, too. Brownites had extracted a public promise from Mr Blair in September 2004 that 2005 would be his last election, but they had long experience of Tony and promises. They wanted him out, on a timetable. So long as the investigation continued, he could not fight back.
Of course I am not suggesting that supporters of Mr Brown and officers of Sir Ian Blair conspired to pursue Tony Blair from office. Our political culture is neither so corrupt nor so obvious. My point is simply that their interests coincided.
In the same way, their interests coincide over the dropping of the case now. The work, after all, is done. What is the point of trying to get an ex-Prime Minister, or even an ex-Prime Minister's associates, into court?
The evidence of cash for honours appears to have been circumstantial, not direct: curry king/property developer gives/lends pile of dough to cash-strapped party, gets recommended for peerage. Scrutiny committee blocks peerages. This leaks. People draw their own conclusions, but you need much more than that in front of a jury.
And besides, as people seem to forget, the four lenders who were put up for peerages did not get them, so the whole thing feels hypothetical anyway.
But if a court case had gone ahead, everything would certainly have turned very nasty indeed within the Labour Party. Desperate people with nothing to lose would have been horribly frank. Pots would have shouted insults at kettles. The Blair-Brown feud would have gone on beyond, as it were, the grave. And which sane Prime Minister wants a precedent set in which prime ministers' careers end with wigs and gowns and handcuffs?
Now the case is dropped. Again, I am not suggesting that Mr Brown and Sir Ian, or Mr Brown and the Crown Prosecution Service, or anybody acting for any of these, have had a quiet word. I am just saying that it suits everyone pretty well.
What is the upshot of it all? I may be in a small company here, but I feel sorry for some of the victims along the way. There was Lord Sainsbury, who forgot to declare a party loan and stepped down as science minister. It was a sour end for a man who has actually given a very good example of the sort of philanthropy and public service we always say we need more of.
There was Des Smith, the unfortunate headmaster who was incited by a newspaper to brag that money for the city academy programme would get you ermine, though he had no power in the matter at all. It was absurd that he was arrested. His career was ruined by nothing more than showing off. There were also the aggrieved four lenders who really only did what was asked of them.
And then there was Lord Levy. His double-fault seems to have been that he was too brash, and that he liked telling people that he played tennis with the Prime Minister. He was Tigger, and people wanted him "debounced". But experience suggests that, where raising money is concerned, brashness is not a vice, and tennis at Chequers may help a bit too.
Lord Levy's efforts moved the funding of Labour away from dependence on the trade unions. That was a public service, one which the cash for honours row has now undone.
I was about to say that I even feel sorry for Tony Blair. It was, after all, his good idea to try to match the Tories in money power. But no, I don't feel sorry for him. If it had not been for his persistent belief that everything is morally good just because he does it, this whole row would never have blown up, and this whole outburst of self-righteous hypocrisy could have been avoided.
The real conspiracy, the real corruption in all this will be if we now get state funding of political parties, supported by all those parties who will benefit from it. That is what is threatened, as Gordon Brown made clear with statesmanlike oiliness in Paris yesterday.
On the radio, one of Mr Blair's now exonerated cronies said that there is a "public interest in having political parties which campaign". Perhaps there is, but what sort of a political party is it which cannot persuade people to back those campaigns with their own money?
The argument of the politicians goes like this: we behave so badly with the money we raise that we must be excused from having to raise it ever again and you must be forced to give us your money instead.
Labour, I believe, owes the bank about £30 million. Yet it concludes that it is we, the public, who owe it a living. This is surely an issue on which the currently beleaguered David Cameron should stand up, as he says he does, for a strong society, not a strong state.