Cameron’s meeting with Blair was a deplorable stitch-up
In 15 years of covering domestic politics I have never reported on anything half as sordid as Tuesday’s meeting between Tony Blair and David Cameron in the Prime Minister’s L-shaped Commons office. Afterwards David Cameron took it upon himself to issue the standard Blairite defence of the recent scandals: ‘We have a relatively uncorrupt party system but we do have a party funding system that is in a mess.’ Charlie Falconer, the Prime Minister’s chief apologist during the funding scandal, couldn’t have put it better.
A spokesman for the Tory party indicated that the occasion was forward-looking, asserting that it was held to discuss looming reforms of party funding. But this claim made no sense. If true, there would have been no need for privacy. Quite the reverse. Cameron would have made his case in public, rather than scuttling into Blair’s office. Nor would it have been a matter for Blair and Cameron alone. The Lib Dem leader Menzies Campbell and leaders of the smaller parties have equally legitimate voices on the subject.
This wasn’t an attempt to make British politics cleaner. It was another stitch-up. Cameron and Blair weren’t looking forward. They were looking back, working out how best to deal with the mess. Both party leaders — Tony Blair in particular — are very frightened men. Blair is under investigation for the sale of peerages. He knows that his premiership may well end in disgrace. Blair’s protégé Cameron is trying to protect him. David Cameron’s entire strategy is to present himself as the ‘heir to Blair’. If Blair goes down, Cameron goes down with him, and Gordon Brown wins. It was exactly as though two safebreakers who normally find themselves in comparatively fierce competition had come together to discuss how best to evade the long arm of the law.
So Tuesday’s Cameron–Blair meeting moved from Downing Street at a late stage was naturally furtive. The seclusion of the meeting-place, well out of the range of press or cameras, was an implicit acknowledgment of a dirty secret. The old forms of democracy have failed and been replaced by a political cartel which both Cameron and Blair have chosen to embody: manipulative, deceitful, self-interested and ideologically empty. The old self-financing mass parties have collapsed and gradually been replaced by externally funded elite factional groupings. New Labour is the most advanced model to have emerged in Britain to date, though David Cameron is seeking to emulate and doubtless to improve on it.
These elite groups are no longer able to raise cash by drawing on a largely defunct membership base. Instead they attract resources by making political power available to private interests. This means exploiting the ability of the state to make decisions that have meaningful financial implications for both corporations and individuals. Such covert exchanges between political donors and politicians — whether expressed through distorted decisions on public contracts or the exchange of honours for donations and other favours have become a systemic part of mainstream British politics over the past two decades.
In a healthy democracy one would look to the main opposition party to expose and disrupt this method of party finance. But the Conservatives over the past nine years have chosen to collaborate with rather then rebel against the endemic corruption of cartel party government. Various attempts have been made over the years to bring to light impropriety and sleaze, most notably by Elizabeth Filkin, the energetic parliamentary standards commissioner. But the Tory and Labour parties united to drive out the toozealous Filkin five years ago, just as they are now coming together to defend themselves against charges that they have abused the honours system.
This month’s investigations by the police and other public bodies are the gravest attempt since Filkin to confront British public corruption. The police investigation is serious. Deputy Assistant Commissioner John Yates, who is leading the inquiry, last week posed questions about the loans made by party donors. He is also examining shocking circumstantial evidence that Labour donors have been rewarded not just with peerages but with government contracts.
The Electoral Commission inquiry into party funding is also significant. There is abundant evidence that both Labour and the Tories misled the Commission about party donations on a massive scale. The Commission last Friday sent out a letter to party treasurers asking for all the exquisite details of the loans. A group of banking experts will judge whether they were above board.
Both the Labour and the Tory party insist that the loans were made on ‘commercial terms’. This claim looks palpably absurd. The loans were made for the most part at 2 per cent above the base rate, in some cases 1 per cent. This is an unrealistically tight rate for organisations without assets or any obvious ability to repay the debt. It would be reckless for a bank to extend such a facility, especially since the sums involved are very substantial — at least £16 million in the case of the Conservatives and £14 million for Labour. Suppose that the real commercial rate is just 1 per cent higher than the rates paid by Labour and the Tories — probably an underestimate. In that case our two main parties have committed a criminal act by failing to declare donations worth tens if not hundreds of thousands of pounds.
Sam Younger, chairman of the Electoral Commission, finds himself in the same position as Lord Butler during his report into the false intelligence on Iraqi weapons of mass destruction two years ago. He has both the power and the ammunition to set off an explosion under the British political system. Lord Butler, for honourable reasons, concluded that it would be improper for him to take this devastating course of action, so stayed his hand. Sam Younger may yearn to do the same. But for him it is not so easy.
The Electoral Commission is required by statute to uphold the integrity of the political system. It can scarcely ignore evidence of deception. At the very least it may ask the political parties to make retrospective declarations that there was a beneficial element in some loans. But the parties cannot do this without confessing that they broke the law.
At this point the issue of prosecution arises. According to the Political Parties, Referendums and Elections Act (2000), the registered treasurer is liable for prosecution following a false declaration. In the case of the Conservative party this individual is Gavin Barwell, a blameless bureaucrat. Matt Carter, former general secretary, seems to have signed off on the Labour loans. But he is a meaningless coda to a distinguished line of substantial former Labour general secretaries like Larry Whitty or Jim Mortimer, deliberately given the job to act as Downing Street cipher. Though Carter may be legally liable, the real responsibility in the case of Labour lies with Tony Blair; as far as the Tories are concerned (though the case is much less clear), with the former leader Michael Howard. This is no academic or hypothetical matter. The Electoral Commission should conclude its investigation within a few weeks, though the police may take longer.