constitutional discipline and the arms trade: the scott report and beyond

Constitutional Discipline and the ArmsTrade: The Scott Report and Beyond

LAURENCE LUSTGARTEN

The Scott Report on the arms to Iraqaffair, published in February 1996,covered an extensive range of matters,notably claims by ministers of publicinterest immunity as the reason for with-holding evidence from the defence incriminal cases; the structure and use oflegal powers to control the export ofmilitary and dual-use equipment; theuse of foreign intelligence by governmentdepartments; and ministerial account-ability to Parliament. In addition, itgives us a picture, unrivalled in detail,of how policy-making and administra-tion are carried out within the govern-ment of this country. But what in the longrun may come to be seen as the mostimportant contribution of the report, overand above any of its particular recom-mendations, is that it has altered theterms of public debate. It has provideda baseline for popular judgement, a plat-form for critique and, by implication atleast, an outline of standards for how thepolitical and adminstrative elite whichgoverns the nation ought to behave. Inthis sense the Scott Report and the NolanReport, however different their specificsubject matter and the circumstances

which gave rise to them, are very muchin tandem. It is the spirit, perhaps evenmore than the letter of the report, whichis its enduring contribution.

That spirit I would describe as one ofconstitutional discipline. By that I mean arequirement that government mustfollow proper procedures of ministerialaccountability and, in appropriateinstances, ministerial responsibility, incarrying out its policies. If convincedthat it is acting in the national interest,any government is entitled to make apolitical choice to do something un-popular, and which its critics mayregard as unethical or inhumane. But ifit makes that choice, it must be openabout what it has done. Put more bluntly,if it wants the pay-off, it must pay thepolitical price in criticism and possibleunpopularity. Since, as Peter Hennessyhas said, in the absence of a formalconstitution all we have is procedure,the importance of this precept of consti-tutional discipline can scarcely be over-emphasised. It is a way of ensuring thatgovernments respect what may justly becalled a form of constitutional morality.This approach would be controversialenough in any field of governmentactivity, challenging as it does many ofthe lifetime habits of those in power. SirRichard's contribution is all the morevaluable because he has applied thesestandards to that area of activity whereforeign policy, defence policy andconsiderations of supposed `nationalsecurity' convergeÐhistorically the areamost notable for unbridled executive

# The Political Quarterly Publishing Co. Ltd. 1998Published by Blackwell Publishers, 108 Cowley Road, Oxford OX4 1JF, UK and 350 Main Street, Malden, MA 02148, USA422

This is a specially prepared and updated version ofan inaugural lecture delivered at Southampton on7 October 1997. I am extremely grateful to SirRichard Scott VC for chairing the lecture. Alonger version with fuller supporting referencesis published in the July 1998 issue of the ModernLaw Review. The analysis presented has benefitedgreatly from discussions with, and informationprovided by, Elizabeth Clegg of Saferworld andDr Neil Cooper of the University of Plymouth,whose generosity with their time and ideas I ampleased to acknowledge.

discretion, and for the unchallenged ruleof the calculation of economic interestand short-term political advantage.

Governance and the arms trade

Yet maintenance of constitutional discip-line must take account of context. By`take account', I emphatically do notmean that where there are strong coun-terpressures, constitutional morality andother ethical considerations must giveway. Quite the reverse: it means thatone must take the full measure of theenemy.

The context of the Scott Report is thearms tradeÐthe sale of weapons andrelated military equipment. The secrecyand deceit documented in the Reportwere inseparable from the activitywhich produced them. Those abusesgrew directly out of the sale of articlesof death to regimes that are violent,dictatorial, oppressive of their ownpeople and often corrupt. It is thegovernment-assisted search for profit inmarkets that are politically controver-sialÐand the establishment with indi-viduals and governments of political,commercial and personal relationswhich cannot be acknowledged to one'sown citizens for fear of adverse reac-tionÐthat make such abuses of parlia-mentary democracy inevitable.

The arms trade has been lauded forits economic, diplomatic and strategicbenefits; it has been damned for its de-stabilising effect on world politics, itsdebilitating impact on the economies ofpoor purchasing countries and, of course,for its contribution to sustaining repres-sive regimes. The value of the allegedbenefits to exporting countries has alsobeen questioned. There is a significantliterature of high quality which takes upthese issues, and I have no special com-petence to add to it. What I would like tointroduce into the debate is a dimensionwhich has largely been ignored, and ofwhich the conduct chronicled in the Scott

Report is, I contend, only one, and not anespecially unusual, example.

This missing element is constitutionalin the fullest sense, for it is the effect onthe way we are governed, and on thehuman rights of everyone living inthese islands. Even if the disputed eco-nomic and strategic claims on behalf ofparticipation in the arms trade beaccepted, they have never been ade-quately weighed against the massivedamage that participation in it inescap-ably inflicts on what truly deserves to becalled our national security. As Ian Leighand I have argued elsewhere,1 the protec-tion of human rights and the health ofdemocratic institutions is the core ofwhat should be regarded as nationalsecurity, and often national security isas much in jeopardy from the actions ofthose in positions of political and eco-nomic power at home as it is from anythreats from overseas. Sir Richard'sreport documented exhaustively the dis-honesty in which ministers and civilservants felt obliged to engage, due totheir twin beliefs that arms sales are vitalto the national interest, and that they canonly be conducted by stealth. Indeed, thearms to Iraq affair is best understood aspart of a wider pattern of behaviourÐonly one, and not an especially unusual,example of conduct which a healthy con-stitutional order should not tolerate.

The Saudi connection

Many other examples of this conductcould be grouped under the title of `TheSaudi Connection'. These are perhapsbest introduced by the question withwhich Lord Cooke of Thorndon, the dis-tinguished New Zealand judge, prefacedthe paper he delivered to the Bill ofRights Conference at University CollegeLondon in July 1997:

Q. `Where is the capital of Saudi Arabia?'A. [after a few tentative voices ventured`Riyadh?'] `The capital of Saudi Arabia is

# The Political Quarterly Publishing Co. Ltd. 1998 The Scott Report and the Arms Trade 423

primarily in Swiss banks, but a lot of it isin British industry.'

He neglected to add, however, that it isnot dispersed generously throughout theindustrial sector, but is concentratedheavily in one area: weaponry. Justunder three-quarters of British defenceexports between 1987 and 1994 went tothis one purchaser, mostly under whatare known as the al-Yamamah contracts.In the defence sector, we have becomevirtually a Saudi client state.

Nowhere was this more painfully evid-ent than in the fate of the Report of theComptroller & Auditor General (C&AG)on al-Yamamah. This group of contractsis actually a succession of agreements forthe sale to Saudi Arabia of various formsof arms and related goods such as theconstruction of air bases. Billions ofpounds are involvedÐthe usual estimateis £20 billion over ten years. From thebeginning, it has been surrounded byreports of massive `commissions'Ðinplain language, bribesÐpaid by the con-tractors to individuals within the Saudiroyal house. In 1992 the C&AG investi-gated the deal, and his report was sent tothe Public Accounts CommitteeÐthemost powerful of the Commons selectcommittees, charged with monitoringthe propriety and efficiency of govern-ment spending. The report was one ofmore than 500 received by the committeeduring the lengthy chairmanship ofLabour MP Robert Sheldon. It metwith a unique response. The chairman,after consulting only his senior Conser-vative colleague, suppressed it. Despiterepeated calls for publication, or at leastconsideration by the full committee, ithas never been seen by anyone else.Parliament as a whole has remainedquiescent. Mr Sheldon's justificationwas that `the Saudis could have takenamiss at the contents and there were lotsof jobs at stake.' Challenged on thisjudgement at a conference on the ScottReport in July 1996, he elaborated by

stating that the report contained `unplea-sant material about people overseas' butno evidence of corruption by `our ownpeople'. He then pointedly added thatboth the committee and the C&AG arelimited to pursuing the use of publicmoney: once it is paid to a third partyÐe.g. a defence contractorÐit is magicallytransformed into private money and isoutside the watchdogs' jurisdiction.2

It is now becoming apparent that theC&AG report itself was inadequate, andthat Parliament may have been misin-formed when a minister flatly deniedthat commissions were paid on the al-Yamamah deal. It must be a matter ofgreat public regret that the libel actionbrought by Mr Jonathan Aitken againstthe Guardian newspaper was aborted soquickly, because the trial forced into thepublic domain valuable informationabout arms transactions with SaudiArabia which had remained suppressed.In particular, a witness who had per-sonally negotiated one of the contractsstated flatly that commissions were paid,in some instances in excess of what Saudilaw purportedly permits. Although thisdisclosure finally led Mr Sheldon to callfor a reopening of the initial inquiry, nosuch action has been taken.

This episode seems as blatant a sub-version of constitutional governmentÐspecifically, of parliamentary account-abilityÐas it is possible to imagine. Toabdicate responsibility for the corruptuse of what might well be millions ofpounds on the grounds that customersmight be offended if it became knownthat they had taken bribes beggars belief,or would do if the spectre of the armstrade were not looming so visibly in thebackground. And that use of a simple`cut-out'Ðan intermediary (here a Britishcontractor or a private commission agent)who breaks the connection between twopartiesÐis sufficient to place the matterbeyond parliamentary scrutiny showshow readily the supposedly paramountpolicy of rigorous public expenditure

# The Political Quarterly Publishing Co. Ltd. 1998424 Laurence Lustgarten

control crumbles where arms sales areinvolved.

Individual justice has also been sacri-ficed to the same demanding idol. DrMuhammad al-Mas'ari was a professorof physics in Saudi Arabia, who became aleading dissident, an Islamic traditional-ist critic of corruption in his country'sgovernment. He was imprisoned for sixmonths, beaten while in custody, thenreleased. Escaping the country, he fledvia Yemen to Britain. Here he establishedan ingenious campaign, spreading infor-mation about the regime and its leadingmembers back to his homeland via theInternet and faxes, hundreds of which hesent out weekly. The Saudis threatenedeconomic reprisals unless the British gov-ernment took action against him.

The reaction was swift. Having failedto deport Dr al-Mas'ari to Yemen, theHome Secretary refused to consider hisclaim for asylum. He then came up withan extraordinary alternative: that Dr al-Mas'ari be deported to Dominica, a placehe had probably never heard of andwhich, it was reported, had been pro-mised an additional £1.5 million in aidas an incentive to receive him. The gov-ernment was at least open about itsmotives: a minister of state admitted inthe Lords that `In fact the activities of Dral-Mas'ari were not illegal as such. How-ever, what he was doing was to actagainst British interests.'3

This was spectacularly confirmedwhen, two days after the decision wasannounced, the Guardian splashed acrossits front page under the headline```David, About this Dissident'' ` aleaked memorandum from Sir ColinChandler, the chief executive of Vickers,a major arms manufacturer, to his direc-tor of international affairs, Mr DavidHastie.4 The memo starts by describingin great depth the internal politics of theSaudi royal house, relating family rival-ries to the treatment accorded Dr al-Mas'ari and other critics of the regime.It is impossible here to give this lengthy

and fascinating document the line-by-line scrutiny it deserves. What can besaid is that it sheds a clear light on thenetworks of influence connecting execu-tives of arms companies and members ofthe British government machinery, andthe ease with which these people glidebetween the two spheres.

One example will have to do: thememo records Sir Colin Chandler andhis opposite number at British Aerospaceproposing to the government that intelli-gence gathered from a prominent IraqidefectorÐpresumably by the Secret Intel-ligence ServiceÐbe passed on to theSaudis to mollify their anger at Dr al-Mas'ari's activities in Britain. The newlyappointed ambassador to Saudi Arabia,Mr Andrew Green, later informed themthat this had in fact been done. Mr Green,it transpires, is also a non-executivedirector of Vickers.

This memorandum revealed, moreclearly than any other single document Iknow, the workings of what may fairly becalled the British military±industrialcomplex. It soon had a companion. Lessthan two months later, Sir Richard Scottproduced his report. It contains a fifteen-page narrative of the circumstancessurrounding British participation in anarms exhibition held in Baghdad in lateApril 1988. Rather lost in the shadows ofsome more celebrated incidents, notablythe Matrix Churchill prosecution, thisaccount none the less repays careful read-ing. Its particular relevance in the presentcontext is that the key actors were MrHastie and Sir Colin Chandler. The latter,having previously been employed at Brit-ish Aerospace, was then a civil servant,head of defence sales at DESO, theDefence Export Sales Organisation. Theformer was on secondment to DESOfrom BAe, which continued to pay hissalary, serving in the specially createdpost of `Business Development Adviser'.In what must rank as a classic under-statement, Sir Richard commented that`through no fault of his own', Mr Hastie


was thereby `placed in a position ofpotential conflict between interest andduty'. Subsequently, though still atDESO, he was, in Sir Colin Chandler'swonderful phrase and on his authority,`deseconded' to attend the Baghdad exhi-bitionÐon behalf of British Aerospace. Hethen resumed his government positionÐ`reseconded', perhaps?Ðbut the evid-ence of communications among otherUK officials makes it clear that he con-tinued to be seen, by them and mostprobably by the Iraqis, as representingthe company. The Scott Report pointedlycriticises many aspects of this affair, aswell as the way in which parliamentaryquestions about it were answered. Thecomments might well have been evenstronger, for it is an unsavoury storyinvolving deliberate ambiguities of sub-stance and presentation, conduct of thesort that later came to be known as`sleaze'Ðitself a euphemism which con-ceals the gravity of official corruption.

The influence of the military±industrialcomplex provided the context for theattempt to expel Dr al-Mas'ari from Brit-ain. In terms of the constitution, theworst aspect of the whole story was theclear demonstration it provided of howuseless Parliament has become as a pro-tector of either the liberty of refugees orthe freedom of expression supposed to beenjoyed by everyone in these islands. Theopposition, normally so ready to offerinstant criticism of any and all govern-ment policies, was notably silent. Repres-entative democracy proved a feebleguardian of human rights. Had thematter been left to a parliamentary vote,Dr al-Mas'ari would now be living on aremote island with no one to share hisfaith.

Although in the end Dr al-Mas'ari wasspared, it is worth noting that his treat-ment was not without parallel. Therehave been other attempts at deportationof politically active refugees from import-ant arms purchaser states. There is thecase of Mr Chahal, who remained in

prison fighting deportation for fiveyears until he won his case in Strasbourg.The European Court of Human Rights, inaddition to holding that the proceduresused by the UK in national securitydeportation cases are defective underthe Convention on Human Rights, alsofound that India is not a safe country towhich an active member of a Sikh inde-pendence organisation may lawfully besent back.5 Its judgment contains adetailed review of evidence of torturecarried out by the Indian police andarmy against Sikh activistsÐdangers towhich the British government seemeddetermined to expose Mr Chahal. Severalother Sikhs held in British gaols werereleased in light of the judgment inChahal's case. It remains to be seenwhether, as the previous governmenthad intended, criminal prohibitions onpolitical activity by refugee dissidentswill be enacted in UK statute.

Trade and aid

There is also the impact of the arms tradeon overseas aid to consider. Here arethree representative quotations from animportant report, with names deleted:

1: `While the terms of [the Minister's] letter . . .were revealed to the House in response to aparliamentary question . . . no specific refer-ence was made in any of the answers torelevant parliamentary questions to the factor content of the simultaneous letter' [fromanother official to the same recipientÐwhichsaid something quite different].

2: `We regard the written answer by [the thenPM] . . . as not fully answering the questions.'

3: After reviewing yet another minister'searlier statement to a select committee, thereport points out that he omitted all mentionof other matters that made his broad asser-tions entirely unsustainable. Its verdict on theconduct at issueÐexpressed with a mildnessat least partly explained by the need toachieve unanimityÐwas that `Ministerialreplies to certain questions were literally


true, though less open and less informativethan the House has a right to expect.'6

This, of course, was not the ScottReport; it merely sounds uncannily likeit. These are extracts from the 1994Report of the Commons Select Commit-tee on Foreign Affairs on the Pergau Damepisode, in which among other things theDivisional Court ruled that the Ministryof Overseas Development had actedunlawfully when it used aid funds on aproject that the department's accountingofficer had refused to approve untilordered to do so by the Foreign Secretary.

Why did the government so relent-lessly insist on proceeding with a projectwhose cost had risen in a short periodmore than 25 per cent over the originalestimateÐmostly, it appears, because ofcorruption in the Malaysian govern-mentÐand which clearly failed to satisfythe normal value for money criteria?Underpinning the whole tawdry episodewas the fact that arms sales had been partof the original deal, as both sides fullyunderstood. But no one in goverment wasprepared to admit this so-called `linkage'publicly, nor were they willing to forgothe benefits. Hence they resorted to pre-senting to the public what is immediatelyrecognisable to those who followed theScott Inquiry as `half the picture'Ðinaccordance with the view of a formerambassador who insisted in testimonybefore Sir Richard that `half a picturecan be accurate'. It is not only in warthat truth is the first casualty, and in thisinstance the integrity of Britain's overseasaid programme, and of the procedures forscrutiny of financial propriety within amajor department of government, suf-fered great damage as well.

It is my contention that these are notrandom or unrelated incidents, but arelike the disparate threads of a spider'sweb, all leading back to one centralsource. That source is the arms trade.These instances demonstrate its domesticimpact in three ways:

. First, policies in unrelated areas suchas asylum, overseas aid and criminallaw are being distorted by the desire tosatisfy states which are large-scale pur-chasers of weapons.

. Second, as the attempt to deport Dr al-Mas'ari and the episode of the Bagh-dad arms fair both illustrate, key mem-bers of the military±industrial complexare able to exert influence and powerwithin government, wholly hiddenfrom public view and without anypublic accountability, to advance theircorporate financial interests.

. Finally, the requirements of constitu-tional government have beenthreatened, and in too many instancesoverridden, in order to assist Britishcompanies seeking to compete in theworld arms market.

Riding the tiger

Faced with this devastating impact of thearms trade on our political life, therewould seem to be four possibleresponses.

The first is to accept the evil to make theprofit. This, in effect, is the position takenby many of the critics of the Scott Report,particularly those who supported thegovernment in the parliamentary debatesand in the media. Though they are oftendignified as Realists, I think it moreappropriate to call them Amoralists.7

Those of this persuasion invariably rankeconomic and other material advantagesmore highly than human rights or otherethical considerations in foreign policy, ifindeed they regard such matters as rele-vant at all. They never even acknowledge,let alone take adequate account of, thedamage to our domestic institutions thatinevitably follows. Indeed, and logicallyenough, people who take this line gener-ally combine it with an insistence thatthose guiding foreign policy mustremain free of interference from domesticpolitical considerations and publicopinion, always disparaged as driven by


emotion; this in turn is held to justifywithholding the truth from Parliament.In his report, Sir Richard flatly rejected aversion of this position presented by LordHowe, the former Foreign Secretary, and Iwould simply agree entirely.

The second possibility is to continue tocompete in the arms trade but to imposeunilateral restrictions, based on the char-acter of the regime seeking to buy theequipment, on what the British govern-ment will permit its exporters to sell, andto whom. A self-denying ordinance ofthis kind was proclaimed by RobinCook, the Foreign Secretary, soon aftertaking office. It is to be accompanied bygreater honesty and openness, makingavailable to the public informationabout the nature, quantity and destina-tion of the material exported. The attrac-tions of such a policy, which recognisesthe ethical and constitutional imperativeswhile seeking to maintain a significantstake for Britain in the international armsmarket, are powerful and clear.

It is painful to say so, but I fear they arealso illusory. While I emphatically rejectthe ethical position of the Amoralists, theaccuracy of their perception of the worldin which we live is another matterentirely. Put simply, developments inthe arms trade which began with theend of the Cold War have seriouslyundermined the capability of the UK toact alone in this field. There has been arapid and dramatic shrinkage of the sizeof the market, accompanied by intensi-fied competition among traditional pro-ducers, and the emergence of new ones.The inevitable result has been creation ofa buyers' market, which has opened theway for purchasers increasingly to dic-tate terms of trade in relation to offsetsales, transfer of technology and othermatters. These circumstances are likelyto persist for the foreseeable future.

It is notable how the criteriaannounced by Mr Cook treat the conflictbetween economics and concern forhuman rights by attempting to straddle

it. They set out in successive paragraphsthe considerations that will be taken intoaccount when deciding whether to grantan export licence:

The United Kingdom's national interests3. Full weight should be given to the UK'snational interests when considering applica-tions for licences, including:a) the potential effect on the UK's defence andsecurity interests and those of allies and EUpartners;b) the potential effect on the UK's economic,financial and commercial interests, includingour long-term interests in having stable,democratic trading partners;c) the potential effect on the UK's relationswith the recipient country;d) the potential effect on any collaborativedefence production or procurement projectwith allies or EU partners;e) the protection of the UK's essential stra-tegic industrial base.Human rights and internal repression4. The Government:a) will take account of respect for humanrights and fundamental freedoms in the reci-pient country;b) will not issue an export licence if there is aclearly identifiable risk that the proposedexport might be used for internal repression.8

What is most immediately striking is thevariety, complexity and open-endednessof the compilation of UK national inter-ests, compared with the narrowness andspecificity of the restraining factors in theparagraph which follows.

This straddle is less a matter of moralambivalence than of trying to avoidfacing painful choices. It was also inevi-table, given the fundamental premise ofthe Foreign Secretary's position. His ac-companying statement began: `The Gov-ernment is committed to the maintenanceof a strong defence industry, which is astrategic part of our industrial base, aswell as of our defence effort.' Within thatframework, any attempt to take accountof factors such as the potential use ofweapons for internal repression, or foraggression against other states, can bemade only by setting up some sort of


notional scale on which that prior com-mitment may be balanced against them.Yet how is that balancing act to be under-taken, when the factors are qualitativelyso different and the criteria themselvesare silent on the relative weights to beattached to the opposed forces?

In my judgement, the most likely out-comeÐone laced with irony, in view ofMr Cook's role as the chief tormentor ofthe government during the debate on theScott ReportÐis that we may yet see areplay of the contortions of policy andpresentation that figure so prominentlyin that report. Except for torture equip-ment and landmines, now totally prohib-ited, a decision either way on almost anyrequest for a licence can be justifiedunder these criteria. If attempts to givepredominant emphasis to the humanrights side of the balance result, asseems inevitable, in business migratingto rival countries, it will be a simplematter to reach a different decisionwhen a similar request is received subse-quently. This will not require any refor-mulation of the criteria in the abstract, forthey are so flexible as to permit anyoutcome. This takes us right back intoScott Report country, for `flexibility' wasthe key word Sir Richard seized upon todescribed how the government manipu-lated its policy and the presentation of itto suit the needs of the moment.

While I hope that this judgement is toopessimistic, the only concrete evidencewe have is, at best, equivocal. As hepresented the new criteria, Mr Cookalso announced that the licences issuedby the previous government for theexport of Hawk jets, armoured cars andwater cannon to Indonesia, despite theirlikely use against the people of EastTimor, would remain in force. The solepublic justification offered was that itwould not be `realistic or practical' torevoke the licences. This opaque explana-tion was never amplified, but it appearsthat Mr Cook did not act under legalcompulsion. `Realism and practicality'

are more likely to refer to the loss of anestimated £300 million worth of orders,half of them to British Aerospace. TheHawk licences were precisely the kind oftesting case in which the existence of thenew criteria might have betokened afundamental change of policy.

It has subsequently been reported that,despite the criteria, the Suharto regimereceived over fifty shipments of variousarms, including machine guns and teargas, whose main use was likely to beagainst its political opponents. On theother hand, licence applications for thesale of armoured personnel carriers andsniper rifles to Indonesia were refusedunder the criteria. This suggests that theyare not purely window dressing. How-ever, the estimated total value of therejected orders was at most £1 million, afar cry from what was at stake earlier. Weshall only know the true extent of theshift in policy when the stakes are highenough to make self-denial really pain-ful. What does seem clear, from both thecharacter of the world arms market andthe early experience of the British gov-ernment's new policy, is that the pros-pects for a sustained and effective policyof unilateral restriction are very dim.

The third possibility, and one whichthe Foreign Secretary also promised topursue vigorously, is a regime of multi-lateral restrictions agreed by all majorsuppliers. There are many reasons todoubt the effectiveness of this approach,but here I can offer only two briefthoughts. One is to note that any multi-lateral arrangement is bound to be dom-inated by the United States, which aloneis responsible for half of global armssales. In light of this imbalance ofpower, the key question will inevitablybe whether any such regime can avoidbeing anything more than an instrumentof American national interest. The otheris that the experience of the EuropeanUnion, by some distance the mostadvanced structure of multistate co-operation in the world, in trying to con-


trol exports both of arms and of dual-usegoods, inspires little optimism about themultilateral approach. Member stateshave steadfastly refused to cede powersof export control to EU institutions andprocesses, insisting that all such issues behandled within the European Unionframework created by the MaastrichtTreaty. This preserves the power ofnational veto over any decision, andgave the French great leverage in thenegotiations over the EU Code of Con-duct which was supposed to be thecrowning glory of the British Presidencyin the first half of 1998: failure to securetheir agreement would have torpedoedthe entire project. They were then able,though standing alone, to extract conces-sions providing for secrecy of operations,and requiring pursuance of a cumber-some procedure for certifying that apotential purchaser is guilty of serioushuman rights violations, that seriouslyweakened the effectiveness of the code.It is an inherent weakness of multi-partycompromise that agreement is too oftenachieved only at the price of much-diluted standards.

The fourth way: getting out

The analysis I have offered suggests thatstates which seek to participate in thearms trade and remain competitive cando so only by ignoring human rightsconsiderations in dealing with foreigngovernments and blinding themselvesto the effects on their own democraticpractice. I submit that this is an unaccep-tably high price to pay for the economicbenefits involved, even at a relativelyhigh valuation. It therefore followsÐnotas a calculation of long-term diplomaticor political advantage, or in light ofreassessment of economic benefits, noreven as a matter of moral scruple aboutothers, but to protect our national secur-ity in the truest senseÐthat Britain mustwithdraw from the arms trade. Conver-sion of the arms industry to civilian uses

is not, as it is normally seen, a matter ofeconomic or foreign policy: it is a consti-tutional imperative.

Conversion has been discussed, withvarying degrees of seriousness, for manyyears. If the challenge it raises were takenseriously, one would have to begin with afundamental rethink of Britain's militaryneeds, of the kind that governments havepromised since the end of the Cold Warbut even the Defence Review of July 1998failed to deliver. Whether Britain needs adefence industrial baseÐthe domesticcapacity to produce military goodsÐofanything like its present size is ultimatelya question of who and what are, and arecredibly likely to be, the military threatsto the nation's security. If, on a calmassessment, the sorts of dangers forwhich advanced high-tech weaponry isa credible deterrent or response appear toloom much smaller than we have beenled to believe, the need for a large domes-tic weapons production capacity is cor-respondingly reduced. This would haveprofound implications for the magnitudeof the task of conversion, and is the kindof public debate which the nation des-perately needs.

Whatever the size of the eventualreduction, it would be neither just norpolitically feasible to impose the entirecost of a withdrawal from the arms tradeon those who presently work in the indus-try. Conversion, at least in the short run,will cause major unemployment. A policywhich involves depriving many thou-sands of people of their livelihoods forreasons of constitutional and moral scru-ple may be justifiable to achieve thehigher good, but it cannot withoutmorally destructive self-contradiction becarried out by simply tossing overboardthose sacrificed in this way to sink orswim unaided in the labour market.Moreover, and quite apart from anygeneral view about economic policy, Isubmit that where the government hasfunctioned domestically as the sole ormain customer of defence companies


and then begins to withdraw its custom,and also changes its policies to restrictexport opportunities by law, it therebytakes upon itself the obligation to assistthose affected to find alternatives. Con-version will require, in other words, anindustrial policyÐactive governmentintervention in the labour market and alarge commitment of public funds toassist in retraining and relocatingpeople, restructuring and financiallyassisting companies, supporting researchand development of new products, andretooling machines.

I stress this point because it runsdirectly counter to current orthodoxy,which relies on a metaphorical marketto allocate the costs of change, therebyoften imposing the burdens on those leastable to bear them. A policy of conversion,radical both in its economic implicationsand in its origins in constitutional con-cerns, fits very badly within the struc-tures and ideology of laissez-faire. Not forthe first timeÐthe histories of both post-war nationalisation and 1980s privatisa-tion provide equivalent examplesÐonesees how inseparably linked are the sub-stance of economic policy and the struc-tures of governance required for its

implementation. Ultimately, it seemsclear, it is impossible to separate publiclaw from political economy.

Notes

1 L. Lustgarten and I. Leigh, In From the Cold:National Security and Parliamentary Demo-cracy, Oxford, Oxford University Press,1994.

2 The author was present at this conference,at St Catherine's College, Oxford, whichwas entitled `After the Scott Report: TheChanges Needed'. See also Mr Sheldon'ssubsequent remarks as quoted in the Guar-dian, 24 June 1997.

3 House of Lords Debates, vol. 568, col. 262(Baroness Blatch).

4 Guardian, 6 January 1996.5 Chahal v. UK (1997) 23 E.H.R.R. 413.6 Third Report, Foreign Affairs Committee,

1993±94, 271-I, `Public Expenditure: ThePergau Hydro-Electric Project, Malaysia',paras 43±4.

7 There are of course many different varietiesof Realism in international relations think-ing, and I am not suggesting that the entiretradition should simply be rejected out ofhand.

8 House of Commons Debates, vol. 299, cols26±9 (Written Answers), 28 July 1997.


constitutional discipline and the arms trade: the scott report and beyond

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