Socialist Worker

BAE scandal: Political corruption and the arms industry

by Simon Basketter
Issue No. 2172

The Serious Fraud Office’s (SFO) plan to prosecute the arms company BAE Systems for bribery in Africa and Eastern Europe has shone a light on the murky world of multinational corruption.

The current allegations cover South Africa, Tanzania, Romania, Chile, the Czech Republic and Qatar. The SFO is also investigating allegations of bribery and fraud in Bosnia, Nigeria, Zambia, Costa Rica and Egypt.

The question we should ask is not whether bribes were paid, but are there any arms deals where there are none?

In among the various investigation documents, a seized BAE memo referred to “third world procedures”, said by the SFO to be a “veiled reference to the payment of bribes”.

But such “procedures” live happily at the heart of the British government.


BAE was involved in providing £600 million in bribes for Saudi princes to get an arms deal. Inquiries into the deal were repeatedly blocked by New Labour.

The prince at the heart of the multi-billion Saudi deal visited 10 Downing Street in 2006 to meet with Tony Blair’s chief of staff Jonathan Powell and demanded the corruption inquiry into this deal was stopped. Blair complied.

Robin Cook, the Labour foreign secretary between 1997 and 2001, said, “The chairman of BAE appeared to have the key to the garden door to Number Ten. Certainly I never knew Number Ten to come up with any decision that would be incommoding to BAE.”

Jack Straw, MP for Blackburn, has been the most persistent supporter of BAE. Straw escorted Condoleezza Rice around a BAE arms factory in north west England in March 2006.

Straw’s links with BAE include Labour peer Lord Taylor of Blackburn. Taylor admitted to having attempted to change legislation for cash. He was a highly paid “consultant” to BAE for more than a decade.

While no longer with BAE, Taylor has at least five remaining “outside interests” at companies that have close contractual relationships with BAE and operate in the arms industry. This is not about bribery. It is the more “respectable” process of lobbying.

BAE has immense lobbying power throughout Whitehall. The Ministry of Defence has given security passes to 38 BAE employees, allowing them to go in and out of the ministry’s headquarters as they please.

There is also a revolving door of people on secondment from the government to the arms industry and vice versa. There is a long list of peers and former ministers, both Labour and Tory, who have ended up on the boards of the arms companies.

One part of the immense lobbying operation run by BAE has not been revealed—until now. It is the rather quaint, if a little secretive, Armed Forces Parliamentary Scheme (AFPS).

According to its founder, former Tory MP Neil Thorne, “The objective of the Armed Forces Parliamentary Scheme is to provide MPs with a real knowledge of the role and functions of the armed forces.

He goes on, “When Members of Parliament make official visits to service establishments they are normally treated as VIPs.”

Of course, for the 30 MPs who take part in the scheme in any one year, the desire to learn more about the armed forces is sincere.

The organisation, a wholly private operation, is a very establishment affair. The last annual reception in June was hosted by defence secretary Bob Ainsworth and Julian Lewis, his Tory equivalent.

It was attended by the chiefs of staff of the army, air force and navy, among others.

The cash for the AFPS is provided by BAE Systems, Rolls-Royce, AgustaWestland and Capgemini UK. These arms companies put in up to £45,000 a year each.

One right wing Tory MP, Douglas Carswell, was thrown off the scheme for criticising helicopters provided in Afghanistan by AgustaWestland.

Participation in the AFPS does not appear in the House of Commons Register of Members’ Interests, though the Electoral Commission has raised AFPS trips being declared as donations.

Correspondence between the AFPS and the Electoral Commission, available on the Socialist Worker website, is informative.

A letter from Chris Bryant, MP for the Rhondda, says the attempt to get membership of the scheme to count as a donation is “completely insane”.

He writes, “I can see no difference between a visit to British troops in Basra undertaken as a member of the Defence Select Committee and the Armed Forces Scheme.

“Nor do I believe that the public is any better served by knowing the cost of such trips.”

But happily for all concerned, sending MPs on VIP trips to far-flung places apparently costs less than £1,000 each, so it doesn’t need to be declared to the Electoral Commission as a donation.

Whether or not a deal is done between the Serious Fraud Office and BAE to keep the billions of profits of destruction rolling in, it looks like the level of influence in parliament and the government will remain regardless of which party is in office.

To see the letters go to »letters.pdf

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Article information

Tue 6 Oct 2009, 18:30 BST
Issue No. 2172
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