COMPLAINTS FROM MR
MOHAMED AL FAYED, THE GUARDIAN
AND OTHERS AGAINST
25 MEMBERS AND FORMER MEMBERS:
SECOND FURTHER REPORT:
MR NEIL HAMILTON
The Committee on Standards
and Privileges has agreed to the following Report:
1. On 3 July 1997 the Committee
published its First Report,
together with the report of the Parliamentary Commissioner for
Standards on allegations made against twenty-five Members and
former Members. On 1 August we published our Seventh Report
containing our findings on twenty-four of those Members and former
Members. We have now completed our proceedings in respect of
Mr Neil Hamilton.
2. In our First Report we
drew attention to the right of those Members criticised to submit
a written statement to the Committee rebutting or challenging
any findings of the Commissioner. Mr Hamilton's submission has
already been published.
We asked the Commissioner to provide us with briefing on the
main points raised by Mr Hamilton. A written summary of the Commissioner's
comments is appended.
Mr Hamilton made an oral statement to the Committee on 14 October
1997, the text of which is published together with this Report.
Also appended are representations from Mr Al Fayed's solicitors
and from The Guardian
seeking, on behalf of witnesses, a comparable right of reply to
Mr Hamilton's statement. After careful consideration the Committee
concluded that these replies would not be necessary to enable
it to reach its conclusions.
3. The procedures used by
the Commissioner and the reasons for their adoption are published
in the Committee's First Report.
In his submission Mr Hamilton made a number of objections to
the manner in which the Commissioner's inquiry had been conducted.
We do not find Mr Hamilton's objections valid in terms of our
remit from the House. We accept the Commissioner's description
of the approach he adopted:
"This was a parliamentary
inquiry and there was no attempt to replicate the procedures of
a court action. The proposed procedures were shown in advance
to the previous Select Committee and to complainees. The approach
was inquisitorial, not adversarial. Its sole purpose was to arrive
at the truth, not to achieve a "conviction"."
4. The Commissioner's findings
on Mr Hamilton were as follows:
(i) The evidence
that Mr Hamilton received cash payments directly from Mr Al Fayed
in return for lobbying services is compelling; and I so conclude.
The amount received by him is unknown but is unlikely to have
been less than the total amount received by Mr Smith. There is
no evidence to indicate that Mr Hamilton received cash from Mr
Al Fayed indirectly through Mr Greer.
(ii) The way in which
these payments were received and concealed fell well below the
standards expected of Members of Parliament.
is insufficient evidence to show that Mr Hamilton received Harrods
hospitality Mr Hamilton received from Mr Al Fayed at the Ritz
and elsewhere was intended, and accepted, as part of his reward
for lobbying. It was not, as it should have been, registered.
(v)Mr Hamilton failed
to register two introduction payments from Mr Greer in relation
to NNC (National Nuclear Corporation) and UST (United States Tobacco),
some of which he took in kind. There is insufficient evidence
to show that the UST payment was a disguised consultancy fee.
Hamilton did not register hospitality received from UST in 1989;
on balance, it would have been better had he done so.
Hamilton deliberately misled the President of the Board of Trade
about his financial relationship with Mr Greer.
(viii) Mr Hamilton
failed to register a consultancy fee from Strategy Network International
on the spurious grounds that an interest acquired and disposed
of within four weeks was non-registrable.
Hamilton persistently and deliberately failed to declare his interests
in dealings with Ministers and officials on the issues of House
of Fraser and Skoal Bandits and, in some cases, was positively
misleading about the status of his representations.
(x)Mr Hamilton accepted
a commission payment for introducing a constituent to Mr Greer,
as well as a consultancy fee for representing that constituent's
interests. Both these actions were unacceptable, the latter additionally
so because it created a conflict of interest for Mr Hamilton in
representing his other constituents.
allegation that Mr Hamilton accepted a paid consultancy from Mobil
Oil in return for asking Parliamentary questions is not substantiated.
In his written statement Mr Hamilton
apologised for his error of judgement in failing to register two
commission payments and the SNI consultancy and for failing to
register his hospitality at the Ritz hotel in Paris. He also
apologised for his failure to declare the UST commission and the
Ritz hospitality when making representations to Ministers.
However, in both his written and his oral statements
he contested many of the Commissioner's findings. In particular
he has consistently denied that he received any cash payments
from Mr Al Fayed.
5. We have carefully examined
Mr Hamilton's representations. Essentially, these repeat the
evidence he gave to the Commissioner for Standards. We do not
consider that Mr Hamilton has brought forward relevant new evidence.
6. Our conclusions are as
it investigated a complaint against Mr Hamilton's failure to register
his stay at the Ritz Hotel in Paris in the previous Parliament,
the Select Committee on Members' Interests did not elicit the
detailed evidence on Mr Hamilton's relationship with Mr Al Fayed
and the campaign managed by Ian Greer Associates which the Commissioner's
inquiry has now established. The relationship was essentially
a business relationship in which Mr Hamilton advocated Mr Al Fayed's
cause. He received material benefits. The visit should have
been registered and Mr Hamilton must have known that it should
examined the evidence relating to the information which Mr Hamilton
gave to the then President of the Board of Trade, Mr Heseltine.
Mr Hamilton never gave away more information about his relationship
with Mr Greer than he had to. The Commissioner's finding that
Mr Heseltine was "deliberately misled" appears to us
to be justified.
(iii) We accept
the Commissioner's findings on Mr Hamilton's failures to declare
his interests when dealing with Ministers and officials.
(iv) We recognise
the force of the Commissioner's criticism of Mr Hamilton's acceptance
of a commission payment for introducing a constituent to Mr Greer
as well as a consultancy fee for representing that constituent's
interests. Such actions do not appear to us to be contrary to
the present rules of the House. We do not agree with the Commissioner's
interpretation of the rules in this instance. We noted in our
that we consider it to be inappropriate for a Member to receive
a fee for introducing a constituency company to another company
Commissioner found a variety of occasions, most of which are now
admitted by Mr Hamilton, when he failed to register his interests.
We draw attention to paragraph 813 of the Commissioner's report-
addition to the stay at the Ritz (dealt with earlier) the main
allegations against Mr Hamilton under this heading [alleged non-registration
of interests] are considered below:
1989 Mr and Mrs Hamilton spent a few days as guests of Mr Al Fayed
on the estate of Balnagown Castle. This was clearly a benefit
of substantial value and should, in my view, have been registered.
Mr Hamilton regarded it as "private hospitality": but
this is a concept not recognised by the Register and, given the
lobbying he was conducting at the time on Mr Al Fayed's behalf,
the benefit could certainly have been thought to affect his conduct
as a Member.
Hamilton acknowledged receiving two Harrods hampers - one in 1988
and one in 1989. By today's standards these would be registrable,
but I am inclined to think that this may not have been the accepted
position at the time.
most, if not all, other lobbyists, IGA regularly paid commissions
to Members who introduced new business. In 1987/88 Mr Hamilton
received an introduction commission of £4,000 and a consultancy
fee of £7,500 in relation to the National Nuclear Corporation.
He registered the latter but not the former, on the grounds that
the introduction payment was ex gratia and unexpected. In my
view there is no doubt that the introduction commission should
have been registered since it might have been thought to affect
Mr Hamilton's conduct as a Member. This was also the view of
the Select Committee on Members' Interests at the time and, although
the Committee recognised that the categorisation of the Register
was unsatisfactory, they did not see this as a justification for
a failure to register such payments.
1989 Mr Hamilton received an introduction fee from IGA of £6,000,
which had been agreed in 1988, in respect of US Tobacco (UST).
Since this was his second such fee, it could no longer be argued
that it was wholly unexpected. It should, in my judgement have
been registered during 1989 and, in any event, in January 1990
after the Registrar had specifically reminded Members at the end
of 1989 of their obligation to declare single payments.
in 1989 Mr Hamilton enjoyed a three night stay at a hotel in New
York at the invitation of UST. This, I think, was a marginal
case, since he was on Select Committee business and his accommodation
would have been paid for anyway. Nevertheless, the benefit could
still have been thought to affect his conduct as a Member and
would have been better registered.
has been suggested that the payment relating to UST was, in fact,
a consultancy fee and not an introduction payment. The evidence
to the inquiry of Mr Walter, the former UST executive was not
conclusive on this point. But this is not an important distinction
if, as is the case, the payment was registrable in either event.
1990 Mr Hamilton received £667 from Strategy Network International
for a month's consultancy work before becoming a Minister. He
suggests that this would have been disregarded, as being de
minimis, in 1990 and that, in any case, he resigned his appointment
within the four-week period allowed for the registration of a
new interest. In my view it is spurious to argue that an interest
acquired and relinquished within four weeks is non-registrable;
and the amount involved was far from negligible. I conclude that
it should have been registered."
Cumulatively this list of omissions
adds up to a casualness bordering on indifference or contempt
towards the rules of the House on disclosure of interests.
7. Mr Hamilton's conduct
fell seriously and persistently below the standards which the
House is entitled to expect of its Members. Had Mr Hamilton still
been a Member we would have recommended a substantial period of
suspension from the service of the House. These conclusions are
justified by paragraph 6 alone.
8. The most difficult issue
is that of the alleged payments to Mr Hamilton by Mr Mohamed Al
Fayed. Having regard to the nature of the alleged transactions
and the conflict of evidence there can be no absolute proof that
such payments were, or were not, made. The principal evidence
upon which the Commissioner based his findings is contained in
paragraph 789 of the Appendix to the First Report. There is no
oral evidence independent of Mr Al Fayed and those who were working
with him at the time. Mr Hamilton has consistently denied that
he took "cash for questions" or was paid for lobbying
services. He questioned at length the credibility of witnesses
who gave evidence on this matter. We have considered whether
it is within our remit to carry out our own investigation. Such
an investigation would have involved taking evidence from those
witnesses who gave evidence to the Commissioner and also reassembling
and reassessing a considerable body of material. The Committee
would have become engaged in the details of inquiry which the
appointment of the Commissioner was meant to avoid, with no certainty
that we could take the matter any further than he had done. Detailed
investigation was by the Commissioner. His terms of reference
"To enquire into allegations
of misconduct against Mr Neil Hamilton and other Members of Parliament
with a view to establishing whether there has been any breach
of House of Commons rules, in the letter or in the spirit, and
to report the findings to the Select Committee on Standards and
We are satisfied that the Commissioner
has carried out a thorough inquiry which took the evidence presented
to him fully into account. The Committee did not arrive at a
practicable way of reaching a judgement which adds to or subtracts
from the Commissioner's findings.
9. As we have said in our
"We recognise that,
in practice, the powers of the House to punish non-Members are
limited. In a future report we shall offer advice to the House
on appropriate penalties and sanctions for Members, former Members
and other persons involved in unacceptable behaviour.".
10. This report is the final
report dealing with allegations made in the media in the summer
of 1996 on the conduct of Members. Its scale and scope were wholly
unlike anything envisaged by the House when it created the new
system for examining complaints against the conduct of Members
and appointed a Commissioner for Standards. Indeed it is important
to remember that the Commissioner's inquiry did not arise from
a specific complaint but from a statement made to the House by
the Speaker and from the request by our predecessors that he should
"investigate as a matter of urgency the serious allegations
about the conduct of Members referred to by Madam Speaker in the
House on 14 October". Unlike our normal procedure where
the onus is on a complainant to submit evidence supporting any
complaint to the Commissioner, the Commissioner was given the
task of defining the allegations and assembling the evidence.
The amount of that evidence was very considerable. Over sixty
witnesses provided evidence, thirteen oral hearings were held
and some fourteen thousand pages of documents were submitted.
The Commissioner was asked by the previous Committee not only
to investigate but where possible to reach conclusions and then
report to the Committee.
11. The scale and nature
of this inquiry, analogous in some ways to that of a tribunal
of inquiry, have highlighted the need for the Committee to assess
its own role in relation to inquiries conducted by the Commissioner
for Standards. Although some guidance was provided by the Select
Committee on Standards in Public Life
and by the Nolan Committee
there is no agreement on whether there could be an appeal against
the Commissioner's findings or conclusions by the Select Committee
except in consideration by the House. The Committee will examine
this matter further.
Report, HC (1997-98) 30-I and II. Back
Report, HC (1997-98) 240. Back
of Evidence, HC (1997-98) 30-IV. Back
Report, HC (1997-98) 30-I, pp.10-11, 132-3. Back
(1997-98) 30-I, pp.129-30. Back
(1997-98) 30-IV, p.xxv. Back
(1997-98) 30-IV, pp.vi-xxviii; Ev. pp.1-21. Back
Committee on Members' Interests, First Report, HC (1994-95) 460. Back
(1997-98) 240. Back
(1997-98) 240, paragraph 26. Back
in its First Report, HC (1994-95) 637, pp.xix-xxii. Back
2850-I, First Report of the Committee on Standards in Public Life,