It’s not just Tessa Jowell who is being investigated — it’s the entire government
Sir Gus O’Donnell, the Cabinet secretary, has been obliged to deal with a considerable volume of intricate business in the course of his brilliant Whitehall career. When he was John Major’s press secretary in the mid-1990s Sir Gus was obliged to familiarise himself repeatedly with the private lives of Tory ministers and MPs. As a senior Treasury official under Gordon Brown he was forced to master the yet more perverse and arcane subject of working family tax credits.
Yet nothing can have prepared Sir Gus for the complexity of his investigation into David Mills, husband of the Culture Secretary Tessa Jowell. The ministerial code is clear. It states that ministers should declare any gifts to family members. But what is Sir Gus to make of the $600,000 payment made to Mills six years ago?
Two years ago Mills informed his accountant Bob Drennan that he had received the $600,000 as a form of recompense for giving evidence in court on behalf of a client. This client was referred to only as ‘Mr B’, and it has been widely assumed that Mills meant Silvio Berlusconi, the Italian Prime Minister. ‘At around the end of 1999, I was told I would receive money,’ wrote Mills, ‘which I could treat as a long-term loan or a gift. $600,000 was put in a hedge fund and I was told it would be there if I needed it. For obvious reasons of their own (I was still a prosecution witness, but my evidence had been given), ... [the donor] needed [this] to be done discreetly.’ Mills now claims that this letter dealt with a hypothetical situation, and insists he never took a bribe from the Italian Prime Minister or, for that matter, anyone else. Nevertheless, the communication put Drennan, who had known Mills for 15 years, in an invidious position. ‘I realised I found myself in a situation I would rather have avoided,’ the accountant later told the Italian authorities. ‘I had a duty to report the matter.’ Mills later claimed that the money had not come from ‘Mr B’ but rather from a Neapolitan shipping tycoon named Diego Attanasio. Unfortunately for Mills, Attanasio has also denied this was the case. Apparently he was in prison at the time and therefore in no position to make any payment.
If Sir Gus is to do his job thoroughly, he needs to do more than merely discern the source and nature of Mills’s $600,000. He must follow its exotic journey through various tax havens and hedge funds to its apparent ultimate use in redeeming the loan secured against the north London home that Mills shares with his wife Tessa Jowell and which has recently been raided by the police.
If Sir Gus is to carry out a really thorough job, he needs to go further still. He can scarcely have failed to note that Tony Blair enjoys a very close relationship with Silvio Berlusconi, the Italian Prime Minister. Berlusconi has extended favours to Tony Blair, at one stage lending him a holiday home. The Cabinet secretary really ought to ask whether Mills, Blair and Jowell have ever discussed Berlusconi, and in what context. And we badly need to know why the Home Office infuriated Italian prosecutors by passing ‘extremely sensitive information’ to the Berlusconi government.
All this is difficult territory not just for the Mills family but also for the Cabinet secretary. The Committee on Standards in Public Life recommended that these investigations into ministerial conduct should be given to an independent body. There were very good reasons for this recommendation, which has been ignored by the Blair government.
The Cabinet secretary lacks both the resources and the independence to do the thorough job necessary. This makes the pro cess open to abuse by the Prime Minister, and Tony Blair has made full use of that opportunity. In 1998, for instance, Downing Street announced that Sir Richard Wilson, then the Cabinet secretary, had carried out an investigation into Peter Mandelson’s infamous home loan. It suited Tony Blair politically to make this claim. But Wilson, who was on holiday with his family in Center Parcs, had done nothing of the sort.
Three years later, and Blair was at it again. Downing Street put it about that Sir Richard had sounded the death knell for Peter Mandelson, causing his second resignation as a result of the Hinduja passports affair. In fact Sir Richard had been on Mandelson’s side. In this case moral cowardice, rather than political convenience, seems to have been the motivation. Tony Blair had made the decision to cut down Mandelson, and wanted to blame someone else.
This time much greater issues are at stake. The truth is that Gus O’Donnell is not just investigating Mr Mills and Tessa Jowell. He has been carrying out a premature post-mortem on the Blair government. What started out with the hope, the freshness, the pledge to be purer than pure has ended up in offshore tax havens, obscure hedge funds and allegations of corruption. Tessa Jowell’s defence is built on the proposition that she didn’t know what was going on, and that her husband handled her financial affairs. Yet this sweet, clueless thing is one of the two most prominent women in the Blair Cabinet.
This is dangerous territory for the Prime Minister, in a week when it looks as if he may well need to rely on Tory support for the passage of the Education Bill. The Prime Minister has always claimed to care for ordinary people, and perhaps he really does. But he only really feels at home with the deracinated super-rich, and the Mills affair is a reminder of that.
Three mortgages may come to define the Blair government. First we had Peter Mandelson’s failure to declare his loan from Geoffrey Robinson in his dealings with the Britannia Building Society. Now we have the mysterious circumstances surrounding Tessa Jowell’s north London home. Most curious of all is the mortgage, thought to amount to £2.5 million, on Tony and Cherie Blair’s home in Connaught Square. How the Blairs raised that money, and pay the interest, has yet to be explained.
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