Politics
Finally, the dirt is being dished
Published 24 July 2006
People at the heart of the police inquiry into loans for peerages are singing like canaries
New Labour has always been something of a conspiracy. The only question, until now, has been how many people were involved.
In his dissection of the phenomenon, Servants of the People, Andrew Rawnsley said there were just four people at the heart of it: Tony Blair, Gordon Brown, Peter Mandelson and Alastair Campbell. The ill-starred lobbyist Derek Draper famously boasted that he could introduce businessmen to the "17 people that count". The "sofa government" coined by Lord Butler in his report on the run-up to war in Iraq consisted of between half a dozen and a dozen individuals. Now a similar number of people around Blair are implicated in the cash-for-honours scandal.
There is a difference this time, with the possibility that the Blairite conspiracy has turned into a real, live, criminal conspiracy. Deputy Assistant Commissioner John Yates, who is leading the investigation into party funding, has informed parliament that conspiracy charges will now be considered alongside breaches of the honours legislation. This takes the scandal to a new level.
After the arrest of Lord Levy and the questioning of two ministers, Lord Sainsbury and Ian McCartney, efforts by the Downing Street bunker to shrug off the affair are no longer credible. I wrote in early June that some at the highest level of the Labour Party were convinced that people around the Prime Minister were offering peerages in return for loans. That conviction has now deepened.
Despite the customary bravura of Blair's confidants, I am told there is open panic among those involved in fundraising before the last election. According to one party figure close to the inquiry, one of the reasons the police have made such rapid progress is that people are "singing like canaries".
One senior Labour source tells me it is now possible to narrow the police inquiry down to seven individuals. Apart from Blair and Levy, these are: Matt Carter, the former Labour general secretary; Jonathan Powell, the PM's chief of staff; Ruth Turner, director of government relations; John McTernan, director of political operations; and McCartney, party chairman at the time of events.
The police have operated like interrogators in an American cop show, prising Labour loyalists apart to dish the dirt on each other. "The police are feeling for the cracks," is one description I have heard. I am told Levy's arrest would not have been possible without the testimony of former allies of the man known as Lord Cashpoint. Meanwhile, Turner is said to have tried to distance herself from the other plotters and to be "periodically very nervous".
Conference woes
The timing couldn't be worse, with Yates planning to present his report to the Crown Prosecution Service on the eve of the Labour conference at the end of September. There are those at the top of the party who believe that even the possibility of conspiracy charges may force Blair to leave office before conference. Party officials talk openly about a second conspiracy: a plot to oust Blair before the end of the year led by the Parliamentary Labour Party, or even elements within the cabinet.
Such speculation has happened many times before. Indeed, talk of Blair's resignation can be measured in anniversaries and conferences. In 2004, ten years after he took over as Labour leader, the mood was feverish until Blair announced on TV, just after delegates had left the Brighton conference, that he would serve "a full term". At last year's conference, Brownites looked in vain for signs of a handover date. This led to the idea that he must be waiting for a new symbolic occasion - the tenth anniversary of the 1997 election victory, perhaps - before handing over the reins.
Now, after his announcement at the G8 summit in St Petersburg that he will still be here this time next year, it seems he intends to let this anniversary slip, too. This year's conference in Manchester will therefore be dominated, once again, by whispers.
Could it be possible that Blair is waiting for June 2008, the tenth anniversary of Draper's "Lobbygate" scandal, before he finally goes? In a way it would be perfect. So much in the story of lobbying companies boasting of access to the "whiter-than-white" new Labour government on behalf of their business clients presaged the sleaze that we have seen.
Then, the country was prepared to forgive the new administration almost anything, and the affair blew over. What few realised at the time was that it exposed a fatal flaw at the heart of new Labour.
None could have predicted then that Labour's desperate attempts to woo business would eventually spark a police investigation that would lead to Downing Street itself. But the signs were already there.
For more on Martin Bright's investigation into the Foreign Office and radical Islam read his blog at www.newstatesman.com/blogs/brightsblog/
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