A Question of Honour by Lord Levy

Andrew Blick
28 June 2008

Andrew Blick reviews A Question of Honour: Inside New Labour and the true story of the cash for peerages scandal by Lord Micahel Levy.

(Lord Michael Levy, A Question of Honour, Simon and Schuster, 2008, 320pp)

Late in 1973, a record called ‘My Coo-Ca-Choo' entered the UK singles charts. It was credited to the glam-rock singer Alvin Stardust; but customers who thought it was Stardust singing on the recording were being had. The voice belonged to Peter Shelley, a musician with a small share in label which released it, Magnet. The main man behind Magnet was Michael Levy. He excuses the stunt on the grounds that it was ‘fairly standard industry practice at the time.'

This book is the latest in a string of insider accounts of the Blair inner circle. It charts the progress of Levy from a humble background, becoming a chartered account, then music business magnate and finally Peer, and tennis playing partner to and ‘Personal Envoy to the Middle East' for Tony Blair. Most famously Levy was chief fund raiser to Blair, popularly known as ‘Lord cashpoint'. This memoir covers familiar ground such as the internal tensions at No.10 and disputes between Blair and Gordon Brown, adding some interesting anecdotes.

Though it deals with other issues, understandably the publishers have billed it as ‘the true story of the cash for peerages scandal'. Levy was at the centre of a police investigation which was triggered when the press learned that a number of individuals who had provided undeclared loans to the Labour Party to fight the 2005 General Election and had subsequently been proposed for peerages, which were queried by the House of Lords Appointments Commission in November 2005. After a complaint in March 2006, an inquiry began into whether an attempt had been made to confer peerages in contravention of the Honours (Prevention of Abuses) Act 1925. The investigation was later broadened to include possible violation of the Political Parties, Elections and Referendums Act 2000 and perversion of the course of justice. All three major parties were under investigation. Ultimately in 2007 the Crown Prosecution Service determined that it would not bring forward any criminal proceedings, but not before Levy was arrested twice (along with three others); 90 individuals were questioned including Blair; and immense and deserved negative publicity was generated about the way parties and senior politicians do business.

Levy was involved in Labour's fateful adoption of the practice of raising money through loans. He describes how, in a meeting he attended at Labour headquarters, he learned that Blair, nervous about having sufficient funds for the looming General Election, had decided the Party would follow the Conservatives in obtaining finance in this way. Using this means it was possible to exploit a loophole in electoral law, which permitted loans given on commercial terms to be declared retrospectively. This arrangement suited both political parties, which could conceal the sources of their backing, and individuals wishing to assist parties while remaining anonymous. But it did not serve the interests of democratic transparency. Levy claims he had long opposed the use of loans, but nonetheless set about raising ‘several million pounds' in this way once Blair gave the go-ahead. As when he was Alvin Stardust's record label boss, once again, it seems, Levy was willing to go along with ‘fairly standard industry practice at the time', however dubious, with grave implications for the integrity and reputation of the political system itself.

This kind of excuse is unsatisfactory. While I will not attempt to reopen the police investigation here and naturally Levy protests his innocence, there were clearly problems in holding either Levy himself - and the Prime Minister he served - politically or legally to account for Levy's actions. Part of the problem was Levy's vague official status. As the House of Commons Public Administration Select Committee (PASC) noted in its report on ‘Propriety and Peerages', because of his nebulous role, pinning down whether Levy was involved in a violation of Common Law on bribery would be a difficult task. The law applies to a ‘public officer' while, as PASC put it ‘In Lord Levy's case, it is unclear if he was an official civil servant, or even if he was paid for his role.'

Another feature of the accountability gap opened by the status of Levy was in his manifestation as ‘Personal Envoy to the Middle East' for Blair, taken on from 1999. Levy describes engaging in various high level meetings around the world, including with heads of government, and expresses the view that ‘on a range of specific issues, in countries where Tony felt Britain needed a direct voice or firmer friendships, I made a difference.' In his book DC Confidential, The former British Ambassador to the US, Sir Christopher Meyer, has expressed a lower estimation of Levy, writing that he saw himself as ‘a latter-day Kissinger of the Middle East peace process' who ‘shuttled around Israel and the Arab countries, giving birth to voluminous reports to London in which he played a prominent role'. Meyer claims he was informed Levy was received in some countries ‘only out of friendship for Tony Blair.' Regardless of his actual significance, the important issue is that there were no definite lines of democratic accountability leading to Levy. He was not recruited through open competition as regular civil servants are, nor was he ever fully subject to the Civil Service Code. On the other hand, he did not answer to Parliament as a minister would. His status as an envoy for the premier undermined the position of the Foreign Office and of the Foreign Secretary, to whom Levy was not answerable, but who is held accountable for foreign policy by Parliament.

Ideally, appointments such as Levy's should be subject to pre-appointment hearings of the sort which are about to be piloted in Parliament - an early test of their viability would be to see if they are used to scrutinise this kind of cronyism. In lieu of such a system, it is important to emphasise that it is the prime ministers they work for who should be held responsible for what these kind of aides do. As with other memoirs by assistants to Blair, it becomes clear that the Prime Minister was in charge. In a description of Alastair Campbell, Levy writes that ‘the criticism that Alastair faced as [Blair's] "spinmaster in chief" acted as a kind of lightning rod. The real spinmaster was Tony himself.'

Similarly the approach to fundraising taken under Blair is attributable to Blair himself. In 1993 Levy approached the then-Labour leader, the late John Smith, saying ‘I have always voted Labour...and I'm ready to do anything I can to help you get back into power'. But Levy was frustrated by Smith's ‘instinctively cautious and consensual' approach, not giving him the go-ahead for all-out fundraising. However, following Smith's death and Blair's succession to the leadership, the tone changed. First Levy raised money specifically for Blair's team. Then in 1996 Blair asked him: if he could ‘start raising money, serious money, for the election campaign'. Blair wanted five million pounds and his most important motive was that he was ‘absolutely determined...that we must not go into the next election dependent on the trade unions.' The fundraising drives that followed, then, were instigated by Blair himself. Given the difficulties that they led to, perhaps the ‘instinctively cautious and consensual' John Smith was onto something.

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