Letter to the Parliamentary Commissioner
for Standards from Mr Tony Baldry MP
You will have seen the article in Sunday's "Sunday
Telegraph". May I please formally refer this article to you
As I understand it, these are matters about which
complaint has been made against me.
The loan for £5,000:
The facts of this are straightforward. I have known
Sarosh Zaiwalla for a number of years as a friend. Some years
before I became a Minister we worked together on a charitable
trust called "The Prospect Trust". We didn't see much
of each other during the time I was a Minister but when details
of my divorce were published in the newspapers, Sarosh got in
touch with me, as he too had experienced a divorce in similar
We met from time to time thereafter, socially as
much as anything, to give each other mutual friendship and support.
It is true that he made me a loan. There was a Loan
Agreement document signed and witnessed by me, which I hope can
be produced which sets out the terms of the loan.
The reason why Sarosh Zaiwalla and I couldn't immediately
recall details of the loan is that we were both telephoned late
on Friday evening, all these matters happened some time ago, and
we were both seeking to co-operate fully with the "Sunday
Telegraph" who were making perfectly legitimate enquiries.
I hope that it will be possible to produce the loan
document as it will show not only the dates and the amounts, but
the fact that I did pay interest on this loan.
I asked Sarosh Zaiwalla if I could borrow £5,000
and my recollection is that it was agreed that I would borrow
£5,000 for a short period of time, but that I would pay back
the sum together with the amount of interest he would lose by
not having that money on deposit.
When I repaid the loan, it was repaid with interest.
I hope that it will be possible to produce a copy
of the Loan Agreement. I myself did not keep a copy as once the
money had been repaid I saw no necessity so to do. I would stress
that at this time my only relationship with Sarosh Zaiwalla was
one of mutual friendship. I had absolutely no contact with him
in my capacity as a Government Minister. As far as I am aware,
his firm at that time was dealing primarily in shipping matters
and international commercial arbitration and had no dealings with
the Ministry of Agriculture where at that stage I was a Minister.
The only reason that Sarosh Zaiwalla lent me this
money was out of friendship but, as I have explained above, it
was a loan that was made without commercial detriment to this
firm, with it being agreed that I pay the cost to them of my using
the sum of money over a short period of time.
The Loan Agreement was witnessed by another partner
in the firm. That partner was subsequently dismissed for misconduct.
There was subsequently arbitration on the Partnership Agreement
where a former High Court Judge found that this same former partner
should repay a substantial sum of money to Zaiwalla & Co.
It was he who took possession of the Loan Agreement and it may
be that when he left the firm, he took this document, together
with other papers. However, I am sure that Sarosh Zaiwalla will
use his best endeavours to find a copy of the Loan Agreement if
it still exists and is in his possession. Moreover, as this loan
went through his firm's accounts, I am sure they will have a record
of the day on which it was lent, the amount that was lent, and
the day on which it was repaid, and the amount which was repaid.
I understand that it is said that I should have declared
this loan to my Permanent Secretary at the time.
I considered this to be a small loan, as between
friends, over a short period of time. I was confident that at
the end of the loan period it could be repaid. I do not consider
that at any time it made me in any way beholden to Sarosh Zaiwalla
and indeed in due course the sum together with the agreed interest,
I certainly didn't appreciate at the time that there
was a suggestion that there was a requirement to report such a
loan to the Permanent Secretary or to enter the same in the Register
of Members' Interests.
It is of course a matter for you and the appropriate
authorities of the House to decide whether I got this matter wrong.
If I did I am fully willing to accept any criticism or chastisement
that is made.
Asian Business Breakfast Club:
The background to this is that some time after the
General Election, I was having lunch with Sarosh Zaiwalla, the
Chinese Ambassador and an Asian banker. Those present expressed
concerns that they felt that the Asian business community was
not sufficiently involved in many ways in the City; for example,
Asian business people were rarely seen at City Livery Dinners.
The idea thus spontaneously arose to form an Asian Business Breakfast
Club, to meet from time to time at the House of Commons.
These are matters in which I have a genuine interest
and concern. When I was a Minister in the Foreign Office I had
amongst other things responsibility for our relations with South
Asia and when I was Minister in the Environment I had chaired
the Inner City Faith Forum, and am very conscious of the contribution
that the Asian communities played in the life of our cities and
in particular in the life of London.
The purpose of the Breakfast Club was to enable members
of the Asian business community to feel more involved and have
the opportunity of meeting business people from established UK
The Breakfast has the continued support of a number
of High Commissioners and Ambassadors, and also of London First,
which, as you know, seeks to promote London as a natural centre
for investment and commerce.
The decision was taken that, administratively, it
would be difficult to have a permanent fixed membership as Dining
Room A only takes 54 people and different people might wish to
come to different breakfasts depending on the guest speaker. In
practice, there is however, a list of "members" who
are written to prior to every Breakfast, and in practice, those
who attend, attend on a "first come first served" basis.
Those attending have welcomed the formation and the work of the
Asian Business Breakfast, and indeed as a consequence, the Turkish
Ambassador and the Ambassadors of a number of Central Asian countries,
asked if a Turkish, Trans-Caucasian and Central Asian Business
Breakfast could be established. It must surely be for the public
good that the House of Commons is seen, and is in practice, seen
to be used as inclusive of every community as possible.
At no time have I derived any financial benefit from
the Asian Business Breakfast. So far as I was concerned, it was
a constructive initiative to promote good relations between the
Asian business community and the community in which they find
themselves working within London.
As I have had at no time any financial benefit from
the Asian Business Breakfast, I could and can see, no interest
to register. With no interest to register, I could not and do
not see that when booking the Dining Room for breakfast, that
there was need for me to declare any such interest.
After the General Election I returned to practise
at the Bar. That fact is registered in the Register of Members'
Interests and it is correct that from time to time Zaiwalla &
Co instruct me as a Barrister. That is in exactly the same way
as they would instruct any member of the Bar to conduct cases
and do paperwork where they are competent.
You will see from the Register of Members' Interests
that I have sought fully to declare all my registrable interests
and indeed I think that your records will show that, from time
to time when I have had queries as to what interests should be
registered, I have written to you.
There was absolutely no intention on my part to mislead
anyone. I genuinely believe that the Asian Business Breakfasts
and the work that they do is to the public good but again I would
welcome you investigating these matters, and I would obviously
welcome any ruling that you and the House authorities may make.
At no time have I sought deliberately to fail to
comply either with the Ministerial code of conduct, or for the
rules of the House of Commons relating to Members' Interests.
I am sorry that my integrity should have been called
into question in this way but I readily and willingly accept that
these are, of course, proper matters to be investigated and I
would ask that they be investigated.
I would also simply observe that when asked about
these matters by the "Sunday Telegraph" I responded
fully and openly and that all the information within that article
relating to me was information that I volunteered to them.
I personally would be unhappy at participating in
proceedings on the floor of the House whilst there is any question
as to my integrity and whilst I intend conscientiously to continue
to deal with constituency correspondence, and constituency concerns,
if I obtain the permission of my Whips, I intend to withdraw from
the proceedings of the House until these matters are resolved.
It goes without saying that I will wish to co-operate
with you, the Registrar of Members' Interests and the House authorities
in any way that I can.
6 December 1999