GAMBLING WITH THE PEOPLE'S CASH
a book about the News on Sunday disaster makes fascinating financial reading
THE only worthwhile thing to emerge from the unqualified mess of the News on Sunday is the book that Peter Chippindale and Chris Horrie have written about it. It is called Disaster! (Sphere Books, £3.99). So far as I can judge it is accurate and scrupulously fair, and it is. certainly well written and put together. I hope it will be taken seriously by all those on the Left who still think they ought to set up a political national of their own. The lesson I draw from this blow-by-blow account is that, granted the commercial inhibitions the Left imposes on itself, acceptance of max- imum trade union demands, anti-sexism in recruitment, advertising and news cover- age, reverse discrimination, insistence on rule by committee rather than a normal editorial and management command struc- ture — to name only a few — there is no possibility of such a venture succeeding. Many on the Left may still think otherwise and in that case they must study this book to see how many of the mistakes they can avoid and still abide by their principles. The book is of interest to others too, because in a curious way the nightmare it describes adumbrates what it might be like for all of us if the Labour Party, as at present constituted, were ever to get office. Substitute Britain for the News on Sunday and you can imagine it all — the Cabinet discussing whether it contains a sufficient percentage of women, blacks, homosexuals and handicapped persons, while sterling collapses and foreigners tread all over us. Not that all of those involved in the NoS were Labour. Some of the most important came from a Left faction called Big Flame. Some were from the International Marxist Group. One of them, Chris Walsh, alias Chris Bott, had been among the four acquitted when ten alleged members of the Angry Brigade were tried at the Old Bailey in the 1970s. But the idea behind the paper was to put Labour back in power. Nicholas Horsley, the Northern Foods boss put in as chair- man, had a meeting with Neil Kinnock in Westminster:
Finding that broking in political power was more fun than selling milk, Horsley self- Importantly told Kinnock he'd better stick to
his socialist principles after being elected Prime Minister, or there'd be trouble from NoS. Kinnock's more realistic reply was: 'That's fine, Nick, so long as you help me get to Downing Street first.' Of course the paper would, Horsley assured him.
If not all the moving spirits were Labour, most of them came from the new Labour- created culture which uses public money for the furthering of political objectives. Alan Hayling of Big Flame, later the paper's Chief Executive, was in the GLC's Industry and Employment Branch, in charge of 'media initiatives'. Chris Walsh (or Bott), the paper's fund-raising co- ordinator and marketing boss, had earlier got cash out of the GLC for what the authors term 'his latest, faltering business enterprise, a Third World Development Unit'. If no great shakes at running a newspaper, these people were clever at socialist begging-bowl finance.
First they got £750 from the GLC for a 'feasibility study'. Then came £10,000 from 'I'm unemployed, but it's all right, I'm a millionaire.' the trade union-sponsored Unity Bank, 'to keep things going for now', then £39,000 from the Greater London Enterprise Board. This last had to be matched by an equivalent sum raised privately. The cash came not, as you might think, from indi- viduals risking their own money, but from another lot of left-wing bodies playing about with funds they controlled: Man- chester City Council, Sogat, the T&GW, the NUJ, the NCU, Nalgo, ACTT and the Bakers' Union.
Then came 'the serious money', the £6.5 million needed for the actual launch. Rais- ing this was made possible when Hayling and Walsh discovered that councils could use up to five per cent of their pension funds on risk ventures. 'Most important of all,' the authors add, 'much of this risk capital — adding up to hundreds of mil- lions right across the country — was at the disposal of the NoS's core group's close political allies.'
But of course the five per cent risk provision concerns ventures with a poten- tially very high return. The City experts turned down the NoS precisely because they thought the chances of such a return were almost nil. So, the authors reveal, did the councils' professional advisers. In Islington they recommended that no more than £50,000 should be risked. Left-wing councillors overruled them and put in £250,000. Hounslow's advisers said the limit should be £10,000. The Labour coun- cillors insisted on £100,000. Southwark's financial director, for sound reasons which he gave in detail, advised against any investment at all. He too was overruled by the Labour councillors and £300,000 put in. At Haringey, the views of the invest- ment advisers were overruled, so £250,000 of the pensioners' money went down the drain. It was the same story at Brent, where an emergency meeting of the Labour council's pension-fund investment panel pushed through an investment of £250,000. As an appendix, the authors give the names and addresses of all NoS sharehold- ers. It makes interesting reading. Horsley himself, I notice, put in only £10,000 of his own money. Sir Denis Forman, who for many years ran Granada TV, coughed up £5,000. One of the very few big individual shareholders was Owen Oyston, with £100,000, and he ended up with the com- pany. The Left-wing actress Julie Christie put in £1,000. Professor the Lord Kaldor and Lady Kaldor contributed £5,000. But the vast majority of the shares were bought by trade union and local government funds at the insistence of their Labour control- lers; prompted entirely by political as opposed to commercial considerations.
One person who ought to read this book is the Attorney-General. He should seek to discover whether those in charge of pen- sion funds complied with the law and, if so, whether there is not some way of streng- thening it to prevent in future such misuse of old people's cash.
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