Socialist Worker

Labour Lords a-leaping

The ‘cash for peerages’ scandal reveals how corruption is the norm rather than the exception under neo-liberalism, writes Andrew Stone

Issue No. 1997

photomontage: Simon Assaf

photomontage: Simon Assaf


‘We are being upfront about this. If they [the donors] were willing to give the time, effort and money to support the academies programme, we wanted to put them in the Lords.” So runs Downing Street’s bullish defence of its conduct in the “cash for peerages” scandal.

It’s a novel approach. The typically anonymous New Labour source is admitting that they see nothing wrong in packing the upper house of parliament with corporate cronies.

There are several strands to this grotesque tapestry. First, we have the revelation that both the major parties accepted huge secret loans to fight the last general election. Several of these generous individuals then found themselves proposed for peerages.

New Labour received about £13 million – apparently without the knowledge of the party’s treasurer Jack Dromey. This included a £2 million loan from supermarket baron and science minister Lord Sainsbury.

When initially quizzed about the loan, Sainsbury claimed to have declared it on the register of members’ interests – the list that allows ordinary people to boggle at the obscene wealth of our “representatives”. He later realised that his office had become “confused” between this loan and a £2 million donation. A minor mistake I’m sure all of us can relate to.

Also among the lenders was Sir Gulam Noon, a fat cat who waged a bitter union busting campaign the year Labour came to power.

The Tories, veterans at the sleaze game, managed £21 million. Some of this was from patriotic donors living in tax havens, and £5 million remains undisclosed after the loans were repaid so that donors could remain anonymous. Well, I’d be ashamed too.

Then we have the academy donors. Des Smith, a headteacher and then an adviser to the Specialist Schools and Academies Trust (SSAT), allegedly told an undercover reporter that a peerage was “a certainty” for the small matter of £10 million.

The SSAT is part funded by the government. Its job is to promote city academies to potential corporate backers. Its president, Lord Levy, is also the Labour Party’s chief fundraiser.

As an anonymous Labour source told the Independent on Sunday, “If there are any buried bodies to be found, well, Levy is the man who knows where they are. He answered directly to Tony.”

Andrew Adonis has also been implicated. He is the now ennobled schools minister who once decried titles as “feudal relics”.

Perhaps the police enquiry will shed further light on exactly who promised what to whom – but don’t hold your breath. What is immediately clear—and yet so rarely stated – is that Lords Levy, Adonis and Sainsbury have no democratic legitimacy whatsoever.

The liberal imperialists who are again itching to “spread democracy” to an ungrateful world should start in their own back yard. Blair’s attacks on civil liberties are so extreme and his Lords reforms so shot through with venality that the hereditary peers look innocuous by comparison.

His proposed Legislative and Regulatory Bill would “modernise” us back to the time of Charles I by opening the door to government by decree.

The justification for that bill is an industry demand to “cut red tape”, that benign euphemism for allowing bosses to walk all over workers. No doubt many of the details were thrashed out over wine and canapés at meals organised by London in Business.

This offshoot of the Labour Party’s business liaison unit gives access to government ministers in return for subscriptions of thousands of pounds per year. Its chair, Kevin McGrath, has defended this cash for access as “completely normal”.

And that’s the problem. Whether it’s Halliburton in Washington or Berlusconi in Rome, neo-liberalism normalises the unaccountable power of wealth. Democracy is made into a hollow shell, a cruel pastiche of the vehicle for change fought for by suffragettes, revolutionaries and civil rights campaigners.

In Britain this takes a particularly archaic form, as the trappings of the old aristocracy remain, remnants of a time when the capitalist class married into its families and subverted its institutions.

But if the form differs, the content remains essentially the same. “Crony capitalism” is the norm, not the aberration. There can’t be genuine political democracy while there’s dictatorship in the workplace.

The common refrain that “they’re all the same” can act as a call to arms against an establishment mired in corruption. But it is more likely to signal a retreat into demoralisation unless a viable alternative is created.

The Labour Party, new or old, has never been that alternative. Even in 1924 its first prime minister, Ramsay MacDonald, was exchanging baronetcies for shares. It has repeatedly sold the hopes of working people down the river.

Andrew Stone is a trainee teacher.


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Sat 22 Apr 2006, 00:00 BST
Issue No. 1997
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