http://www.ft.com/cms/s/2bb1a25e-b0d0-11db-8a62-0000779e2340,_i_rssPage=89048496-2f6a-11da-8b51-00000e2511c8.html

Documents link BAE with Tanzania arms bribes, Short says

By Christopher Adams,Political Correspondent

Published: January 31 2007 02:00 | Last updated: January 31 2007 02:00

Clare Short, the former international development secretary, claimed 
last night she had been told by fraud investigators they had documents 
showing there was bribery in an arms deal involving the supply of an 
air-traffic control system by BAE Systems to Tanzania.

The allegation, made during a House of Commons debate on the 
controversial cabinet decision in 2001 to approve the sale, came as 
Hilary Benn, the current international development secretary, conceded 
there were "lessons to be learnt".

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He added that ministers would look at whether controls on arms brokers 
should be tightened as part of a forthcoming review of the Export 
Control Act.

Mr Benn refused to comment on the Serious Fraud Office investigation but 
he appeared to suggest that, as a junior development minister at the 
time, he had shared Ms Short's original concerns about the deal when the 
export licence was granted.

"I was a loyal and supportive parliamentary undersecretary" to Ms Short, 
he said, and added: "At the point at which the government took a 
decision about the licence, there was then a collective decision, which 
it was and is the duty of all members of the government to support."

Ms Short, in an intervention after a Labour MP challenged the Liberal 
Democrats to back up a claim of "alleged bribery" against BAE, said: 
"The SFO came to see me and said they have documents showing there was 
bribery." She did not elaborate on the details of this meeting.

Jakaya Kikwete, Tanzanian president, confirmed this month that the SFO 
had visited his country as part of its probe into the purchase of the 
air-traffic control -system.

The Guardian newspaper has reported that BAE Systems allegedly made 
secret payments of $12m into a Swiss account to cement the deal, 
representing 30 per cent commission charged on top of the price.

BAE has said it is fully co-operating with the investigation and has 
denied any wrongdoing.

Ms Short, who had argued against the Tanzanian deal in cabinet on the 
grounds that it would undermine sustainable development in Tanzania, 
said all those involved in it "should be deeply ashamed".

She said the deal was "a particularly sordid example of the UK approach 
to arms sales". "I'm well aware, indeed hopeful, that the current 
investigation into this case by the Serious Fraud Office might result in 
criminal charges.

"That will be decided elsewhere. What is important here is for UK 
politicians to learn the lessons of the reality of UK arms sale policy 
and make real changes so that similar deals are not supported in future."

The SFO had no comment to make last night.

Copyright The Financial Times Limited 2007

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