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Tony Blair on Thursday scrambled to try to secure a multi-billion pound arms deal with Saudi Arabia before he leaves office in two weeks, dismissing calls by UK opposition parties to re-open a corruption inquiry into dealings with Riyadh.
The British prime minister, speaking to reporters on the margins of the Group of Eight nations summit in Germany, warned that the Serious Fraud Office investigation, abandoned last December after his intervention, would have led to the “complete wreckage” of vital British interests had it been allowed to continue.
The Saudis are poised to sign a successor deal to the al-Yamamah arms agreement conservatively estimated at £20bn ($40bn, €30bn) to supply Typhoon jets, possibly as soon as next week. The deal would help secure tens of thousands of British workers’ jobs at BAE factories across the UK.
But there were fears in Whitehall that fresh allegations of bribery surrounding the original deal, which was negotiated by former prime minister Margaret Thatcher in the 1980s, risked angering the Saudis and could put back any signing.
Mr Blair acted swiftly, declaring that it had been right to halt the SFO investigation amid threats that the Saudis would end co-operation on intelligence and security matters.
“This investigation, if it had gone ahead, would have involved the most serious allegations and investigation being made of the Saudi royal family,” he said. “My job is to give advice as to whether that is a sensible thing in circumstances where I don’t believe the investigation would have led to anywhere except to the complete wreckage of a vital interest to our country,” Mr Blair said. The fight against terrorism would have been harmed and thousands of British jobs lost.
The prime minister is hoping to secure the Typhoon contract, which would be Britain’s biggest export deal, before he leaves office. Industry insiders said on Thursday that there was a growing expectation that an agreement would be inked next week. According to British media reports, BAE paid more than £100m a year to Saudi Arabia’s former ambassador to Washington over more than a decade in connection with the al-Yamamah defence contract.
The reports, from a BBC television programme and the Guardian newspaper, said the sums were paid to Prince Bandar bin Sultan. Prince Bandar, now a national security adviser to King Abdullah of Saudi Arabia, is the son Prince Sultan, Saudi defence minister.
Sums equivalent to £30m a quarter were allegedly paid with the knowledge of the UK Ministry of Defence into accounts at Riggs Bank in Washington to which Prince Bandar had access, the Guardian reported.
BAE will not comment on the specific allegations and denies there was anything illegal in payments it made in association with the £43bn al-Yamamah contract under which it supplied warplanes and other defence equipment to Saudi Arabia.