The Hinduja-Funded Spirit Zone Wasn’t The Only Corporate Cash Deal Done at The Dome
For The Observer
Sir Anthony Hammond was so busy, busy, busy last month clearing absolutely everyone in Government over the Hinduja affair that he had no time to speak to the key witnesses. ‘I have not interviewed any of the Hinduja brothers,’ he writes in his report to the Prime Minister. ‘There were obvious practical difficulties in visiting them in India.’ Yes, and sea monsters had eaten all the phone lines to the sub-continent, I assume.
If on his way to investigate the Hinduja-funded Spirit Zone at the Millennium Dome Sir Anthony hadn’t been as hurried as the March Hare, I would have invited him on The Observer ‘s special tour of the Dome. Had he followed me through the doorway marked ‘Privileged Access’, he might have asked whether there was a flea market in favours surrounding Geoffrey Robinson, Peter Mandelson, John Prescott and others at the top of a Government obsessed with funding the Greenwich sinkhole and other New Labour projects. But Sir Anthony was not asked to ask questions about the Dome.
June 1998 was One Amazing Month. Besides juggling Hinduja requests, the Government had to squeeze in the secret meetings with Tesco. John Prescott’s Transportation Task Force was to announce a plan for a tax on shopping centre car parks; it would cost Tesco upwards of £20 million a year. Tesco’s lobbyists described how the retailer ‘repositioned’ after a Dome pledge, and the wording of the Task Force report was supposedly redrafted to exempt Tesco from the tax.
Did the Dome dosh influence the tax break decision? Both the Government and Tesco say no. A government spokesman protested that Tesco made its pledge to the Dome in February, months before the Government had considered the tax. Not so, said Tesco’s lobbyists (not knowing The Observer team was recording them). They had ‘intelligence’ about the tax from government insiders at least three months before they announced the Dome donation. So while there’s no evidence that Tesco made the donation to get its way over the car park tax, advance knowledge of the proposal must have helped the tax break campaign.
In June 1998, the Government was about to boot US-based Gtech from its National Lottery work following a libel jury’s finding that Gtech’s then CEO tried to bribe Richard Branson. But then…
‘The Government needed someone to sell tickets for this ridiculous Millennium Dome thing that my old boss [Mandelson] is building. Gtech has offered to do that via the National Lottery selling equipment,’ said lobbyist Derek Draper into my concealed tape recorder.
And it came to pass that Gtech provided the valuable national ticket-selling network for the Dome, without charge, and the Prime Minister went back on his election pledge to boot the tainted American firm from the Lottery. Camelot, which operates the Gtech machinery, says that contract renewal was ‘not the reason’ it helped the Dome.
Sir Anthony asked no questions of Mandelson nor anyone else about alleged Dome deals in that busy, busy month of June 1998 other than in relation to the Hindujas. Sir Anthony was asked not to ask by the Prime Minister. By limiting the investigation’s terms of reference, the PM effectively guided Sir Anthony blindfolded into the Hinduja Spirit Zone with orders to ignore any dripping knives, headless corpses, and bloody howls emanating from the other zones of the Government’s cash-for-access funhouse. In that same month of June, The Observer learned that Robinson, then a Treasury official, held a secret meeting with the CEO of PowerGen Corporation.
Its lobbyist says it discussed a scheme to trade approval for a three-way merger between PowerGen, East Midlands Electricity, and a US power firm. In return, the new mega-company would support another New Labour project: contracts for the UK coal industry. Trade and Industry Secretary Margaret Beckett, by law in charge of the matter, was kept in the dark about this alleged soto voce bargain.
And, lo, it came to pass that the PowerGen East-Midlands merger (without the US company, which dropped out) was approved, but only after Blair bounced Beckett out of her ministry and replaced her, in September, with one Peter Mandelson. The day after Mandelson approved the merger, PowerGen signed the coal contracts. A Robinson chat with PowerGen about coal mines and energy policy is utterly legit. But if Robinson mixed in the quasi-judicial decision about mergers and passed that on to Mandy for action, isn’t that worth an investigator’s question or two? Sir Anthony would not be so rude as to ask.
The Hammond investigation, as the late, great baseball player Yogi Berra would have said, is dÃ©jÃ vu all over again.
In August 1999, Lord Neill’s Parliamentary Committee on Standards in Public Life was offered evidence of possible favours for Dome donors and the Robinson meeting but, ‘the committee,’ its spokesman said, ‘believes the subject matter was thoroughly covered in the testimony of Derek Draper’.
PowerGen lobbyist Draper, listed by the committee as ‘former aide to the Rt Hon Peter Mandelson MP’, assured the committee there was ‘certainly no systematic corruption going on’. And that settled the matter. The committee may have reached the right conclusion, but the lack of hard questioning means we can never be certain.
Contrast Sir Anthony’s relaxed questioning of Mandelson to the grilling of Bill Clinton this month over the ex-President’s pardon of fugitive Marc Rich. Clinton and his White House aides had to withstand withering questions before a hostile Congress, under oath and the television lights. The inquisition exposed an extraordinary web of cash transfers to Clinton projects and a lobbying operation entangling the Prime Minister of Israel and the King of Spain.
It is no accident that the names of foreigners such as Hinduja, and more often than not American operators, pop up in tales of cash for access. Outsiders, lacking family links and old school ties, need blunt instruments and insider contacts to break into Britain’s power elite, one of the planet’s oldest and sturdiest economic oligarchies.
The American body politic is at least as corroded by cash for access as Britain’s. But Americans don’t grow up inculcated with illusions about the integrity of their leaders (excepting the dead ones on Mount Rushmore). Our inquiries are handled with the assumption that our leaders are rotten, it’s just a matter of figuring to which vice they succumbed.
If Britain’s ruling gentlemen are now going to play US-style influence games, the public will need US-style investigations. Yogi Berra could have explained this to Sir Anthony. As he once said: it’s amazing how much you can see when you’re looking.
Gregory Palast’s other investigative reports can be found at www.gregpalast.com where you can also subscribe to Palast’s column.
Gregory Palast’s column “Inside Corporate America” appears fortnightly in the
Observer’s Business section. Nominated Business Writer of the Year (UK Press
Association – 2000), Investigative Story of the Year (Industrial. Society – 1999), Financial Times David Thomas Prize (1998).