Hawk

Return to an Address of the Honourable the House of Commons
dated 18 July 1996 for the Appendices to the Report of the Inquiry into the Export of Defence Equipment and Dual-Use Goods to Iraq and Related Prosecutions laid before The House on 15 February 1996*

Volume Two
Section D Arms and Defence-Related Exports to Iraq
Chapter 6 Specific Export Licence Applications after the Cease-Fire

D6.1 The Hawk Project (or the Saad 25 project, as it was sometimes known) was conceived in 1981 as “a collaboration between British Aerospace, Rolls Royce and the State Organisation for Technical Industries to create an aerospace industry in Iraq .... to be based on a trainer aircraft such as Hawk.” *1 Discussions had continued during the war with Iran and were still in train when, in August 1988, the cease-fire was agreed. While the war continued a major stumbling block to further progress on the discussions had been the Iraqi insistence that, as part of the project, at least 20 Hawk aircraft should be supplied to the Iraqi Air Force. The Government view was that the supply of these aircraft to Iraq would be out of the question so long as the Iran/Iraq conflict continued. As it was put in a letter dated 18 April 1985 from Mr Luce to Mr Adam Butler: “It would be quite impossible to sustain in Parliament the argument that the addition of a further 20 advanced ground attack/trainer aircraft would not enhance Iraq’s military capabilities”. The advent of the cease-fire represented, therefore, the removal of the stumbling block and an opportunity for the discussions to be progressed. At the meeting on 21 December 1988 between Mr Waldegrave, Lord Trefgarne and Mr Alan Clark, officials had said that the Hawk project “was just the sort of proposal they would want to recommend for approval in applying any new flexibility in the guidelines”. *2 A Note dated 4 April 1989 from Mr Barrett to the Minister (DP) explained that “the project has been scaled down from the 1981 concept .... to one which will now provide aircraft assembly facilities during Stage 1 (Years 0 to 8)” and that “.... Stage 1 also includes the construction of an airfield and the supply in kit form of 40 Hawk 60 trainer aircraft for local assembly.” The Note said, also, that “the [MODWG] did not consider the proposal against any guidelines” and that “The factors to be considered are mainly presentational. We can expect Parliamentary and public opposition to the proposal.” *3

D6.2 Following a presentation by British Aerospace (BAe) to Ministers on 8 June 1989, a formal AWP application was submitted by BAe on 12 June 1989 seeking “permission to proceed with a proposal to assemble 63 Hawk series 60 Trainers in Iraq” *4 On 15 June 1989 Lord Trefgarne wrote to Mr Waldegrave recommending approval of the proposal. The letter stressed the value of the proposed contract both to BAe and as a means of generating other associated defence contracts but warned that “we must as a government consider the political implications of accepting the project and the way in which its acceptance would be presented as consistent with the guidelines which have for some years now controlled our defence sales to both Iran and Iraq”. After a reference to the “published guidelines” (emphasis added), on which I have already commented *5, the letter said that “my professional advisers consider that the sale of Hawk to Iraq envisaged in Project 3/25 would be within our guidelines. In making this assessment they have had regard to the strict published guidelines and have not in this case needed to take account of the more relaxed interpretation which we recently approved for sales to Iraq.” *6

D6.3 The position at this stage seems clear. The “professional advisers” ie the MODWG, had advised that supply of 63 unarmed Hawk trainer aircraft would not significantly enhance Iraq’s military capability and did not constitute the supply of “lethal” equipment. The approval of the BAe proposal hinged, therefore, on political factors.

D6.4 Mr Alan Clark, to whom a copy of the MOD letter of 15 June had been sent, supported the MOD approach. In a letter dated 22 June 1989 to Lord Trefgarne he noted that the project was a long term one and “one which will not directly increase Iraq’s offensive military capability.” It may be noticed that he was assessing the proposed supply of the Hawk trainers by reference to the revised, not the original, guidelines.

D6.5 The BAe proposal had, by this time, become the subject of public and media attention. Parliamentary Questions on the subject were anticipated and draft answers, together with a briefing, were supplied by Mr McDonald to the Minister (DP) (with copies to Mr George Younger, the Secretary of State for Defence). The briefing advised the Minister that “The MOD military assessment is that the technical stage 1 proposal would fall within the guidelines. The aircraft concerned are trainer aircraft .... As such they would not exacerbate and prolong the conflict ....”. *7 It may be noted that Mr McDonald used the language, by now inapposite, of the original guidelines. There no longer was a conflict. The briefing went on to draw the Minister’s attention to other factors to be taken into account, namely, “the human rights record of Iraq and the likely public and Parliamentary reaction to the sale; the ECGD involvement in the financing.”

D6.6 The recommended answers to the possible PQs included: “Our policy on defence sales to Iraq is unchanged and any sales of defence equipment to that country would remain strictly subject to the [original] guidelines....” and “The guidelines .... remain unchanged”. *8 These answers would, if given, have been untrue. Policy on defence sales to Iraq had changed since the cease-fire. Guideline (iii) had, for Iraq, been changed.

D6.7 Following the presentation by BAe the Foreign Secretary was alerted to the fact that Ministers were shortly to be asked to give political support to BAe in respect of Hawk. *9 Senior officials were concerned as to whether it was in the UK’s long term interest to acquire the position of “principal supplier of main armaments to Iraq” which they saw as “quite unusually repressive” *10 and Mr Waldegrave supported that view. The Foreign Secretary decided a meeting was necessary to discuss the point. Prior to the meeting on 23 June 1989 Mr Waldegrave wrote to the Foreign Secretary on 20 June 1989. 11 He commented “It is a horrible situation. Iraq’s regime is one of the most vicious in the world. They are aggressive; use torture and repression; have used CW widely against Iran and the Kurds; and their diplomats have behaved intolerably in the UK. The judgment is, are we strong enough as a trading nation to spurn their market on the grounds of morality? If we were, we should. On balance, I judge that we are not, but we should recognise that our decision to sell Hawk will do us damage in the UK with serious and honest commentators.” At the meeting the Foreign Secretary decided the problem should be discussed in OD, and the MOD were asked to make arrangements for this to happen.

D6.8 On 26 June 1989 Mr Waldegrave replied to Lord Trefgarne’s 15 June letter. *12 He said that it would be possible to “argue that [the Hawk] sale would not break our guidelines governing defence exports to Iran and Iraq, though this would carry little weight in the media.” He went on to say:

D6.9 On 28 June 1989 Mr McDonald put up to the Secretary of State a proposed draft paper on the Hawk project. The draft referred to the guidelines (in their original form) and said that “On a military judgment [the MOD] considers that the proposed sale would not significantly enhance the Iraqi capability to prolong or exacerbate a conflict with Iran and that therefore it falls within the guidelines.” *13 The Secretary of State was not content with the draft. I have already referred to his request for more details about the agreement of Ministers “to interpret [the guidelines] in a more flexible fashion for Iraq”, of which he had been informed in the submission. *14 In addition, and perhaps more important, the Secretary of State queried his officials’, and his junior Minister’s, support for the project. In a Note dated 3 July 1989 to the Minister (DP), his (Mr Younger’s) Private Secretary, having referred to Mr Waldegrave’s letter of 26 June 1989, said that “whilst [the Secretary of State] recognises that a case might be made that the sale of Hawk technology to Iraq could be represented as being within the terms of current guidelines on defence sales, he believes that the clear potential of the Hawk to be adapted as a combat aircraft (theoretically capable, as critics would no doubt not be slow to emphasise, of delivering CW munitions) would lead to a forcible and widespread challenge of that interpretation. Against that background .... he would be grateful for a further thorough assessment of the potential advantages and disadvantages of Government support for BAe’s proposals ....” *15

D6.10 In order to take account of the Secretary of State’s reservations regarding the Hawk project, the draft paper which was to go to OD on the subject was re-drafted. In a comment on the draft OD paper, Mr R Hatfield, Head of Sec (O)(C), accurately analysed the issue to be addressed. He said: “.... in preparing the arguments I think that we ought not to become over obsessed with how the Hawk sale fits part [sic] or recently relaxed guidelines. The key question is whether or not the sale can be justified on its own merits in terms of overall UK interests ....” *16

D6.11 After further amendments, the draft paper reached an agreed form and, as a Memorandum dated 20 July 1989 by the Secretary of State for Defence, was duly delivered to the Cabinet Office. *17 The Memorandum contains interesting references to the guidelines on which I have already made some comments *18 and then under the heading “The MOD Assessment in Relation to Guidelines” advised that “.... the addition of 63 trainer aircraft could not be regarded as significantly altering [the Iraqis’] combat capability” and that “.... the proposal for Stage 1 would not significantly alter the Iraqi capability to prolong or exacerbate a resumed conflict with Iran”. It will be noted the “interpretation” of guideline (iii) expressed in that passage is a different “interpretation” to that which was currently being applied by the MODWG and IDC. Be that as it may, the Memorandum then said that “A final judgement on whether the proposal falls within the terms of the guidelines is, however, a matter of interpretation. Critics of the proposal will undoubtedly point out that Hawk is in service .... as a combat aircraft with a number of countries including the UK” *19 and that the sale of the aircraft to Iraq would be “likely to be seen by many as a major military benefit to Iraq and as being of considerable political significance.” The Memorandum then, under the heading “Presentational and International Factors”, referred to Iraq’s use of CW both in the war with Iran and against the Kurds and warned that “The Government could be severely embarrassed if .... Iraq used CW again in the course of the project or ever used the Hawks in an offensive role.” After referring to “Financial Considerations”, which were adverse *20, and to “Commercial Considerations”, which were highly favourable *21, the Memorandum expressed these “Conclusions”:

Finally, the Secretary of State recommended that, on balance, BAe should be given approval for the Project to proceed.

D6.12 There are a number of interesting features of the 20 July 1989 Memorandum but the most important, for present purposes, is the insight it provides into the use of the guidelines. The military assessment on “significant enhancement” was unequivocal. The supply of the Hawks would not significantly enhance Iraqi capability. The aircraft were being supplied as “trainer” aircraft, without any guns being mounted, although an adaptation of the aircraft to permit the mounting of guns would always be possible. According to the Memorandum, “whether the proposal falls within the terms of the guidelines is a matter of interpretation”. In effect, the Memorandum was suggesting that if it was desired to approve the Project, the supply of the Hawks could be presented as being within the Guidelines, but that if it was decided to reject the Project, the supply could be said to be barred by the Guidelines.

D6.13 The OD meeting took place on 27 July 1989. Mr Appleyard, Deputy Secretary at the Cabinet Office, provided a Note dated 25 July for the Prime Minister. The Note referred, in paragraph 11, to the “Government guidelines ... announced to Parliament on 29 October 1985”, *22 annexed a copy of the Hansard extract and said that “Although the Hawk is designed as a training aircraft, it has an offensive capability and can be adapted for use in both the air defence and ground attack roles”. *23 The Note went on to refer to the “more flexible interpretation of the guidelines for Iraq (but not Iran ....)” that had been agreed on by FCO, DTI and MOD Ministers and described the “more flexible interpretation” thus: “The ban on the supply of lethal equipment to either side was re-affirmed; but it was agreed that orders for non- lethal equipment should be refused only if they would be of direct and significant assistance to Iraq in the conduct of offensive operations in breach of the ceasefire.” The Note advised the Prime Minister that “FCO, MOD and DTI Ministers consider the Government could argue that the sale would be within the revised guidelines.” The Prime Minister’s manuscript comment in the margin of the document at this point was “Doubtful”. It may be noted, in passing, that the passages in Mr Appleyard’s Note to which I have just referred constitute the high water mark of the case that the Prime Minister was put on notice that the original guidelines had been revised. It is, obviously, a fair point that the references might have directed her mind to ask when, how, in what manner and by whose authority the originally approved guidelines had been revised so as to substitute a new criterion for the original guideline (iii). But the Note was focusing attention not on any differences between the original and the revised guidelines, not on the fact of the revision, but on the Hawk Project and whether it should be approved. The Prime Minister’s attention was intended to be and was focused on that issue. I do not find it at all a matter of surprise that she did not question the reference to “the revised guidelines” and did not notice the difference between the original guideline (iii) and the substituted criterion set out in the Note. In her oral evidence to the Inquiry, Lady Thatcher, when asked whether she had noticed that difference, replied “No, I did not. I was concerned with the big issue” *24, ie the Hawk Project issue, and later “.... that [ie the reference to ‘revised’ guidelines] did not strike me at the time. I was on the big issue.” *25 I find this evidence inherently credible. She was concentrating on the issue raised by the Note and on which a decision would have to be reached at the OD meeting.

D6.14 To return to Mr Appleyard’s Note, the Note gave a warning that the sale of Hawk to Iraq “would attract criticism in the press and Parliament because of the unsavoury and repressive nature of the regime and its use of chemical weapons (CW) against both Iran and its own Kurdish population” and that “critics would argue that .... Hawk .... falls within the definition of ‘lethal equipment’ and would be particularly well adapted for use in a ground attack role against the Kurds, possibly for dropping CW”. After commenting on the adverse financial implications of the proposed deal, the Note turned to “Reaction in Parliament and the press”, and warned that the FCO, DTI and MOD Ministers’ view that the proposed deal was consistent with “existing guidelines” was “sure to be challenged”.

D6.15 Lady Thatcher underlined a number of passages in the Note. It was her practice to underline passages that seemed to her to have particular force. The underlining of particular passages makes clear that her reaction to the proposal was one of opposition as, indeed, was the tenor of the Note itself. She received other submissions on the Hawk Project in addition to Mr Appleyard’s Note. A Note dated 25 July from Sir Percy Cradock, the Prime Minister’s Foreign Policy Adviser, had expressed the conclusion that the project “.... could be presented as being within the revised guidelines” and that “on balance .... the arguments for approval prevail”. *26 A Note dated 21 July 1989 from Sir Charles Powell, her Private Secretary, set out the pros and cons of the project, commented that “The balance is a difficult one to strike” but noted that despite the “risk that we shall incur a great deal of trouble and odium for no reward .... the pot of gold is enticingly large.” *27 But in a submission dated 26 July, after he had had an opportunity of reading Mr Appleyard’s Note, Sir Charles advised unequivocally against approval of the Project. His submission said this:

D6.16 The Prime Minister made clear in her evidence to the Inquiry that Sir Charles Powell’s advice corresponded to her own thinking. The issue she said, “seemed to me very, very clear cut .... it was such a straightforward decision”. “Even though this is a big order”, she said, “you cannot let [that] influence your judgement against your deep instinct and knowledge that it would be wrong to sell this kind of aircraft, that could be used for a ground attack, to a regime that had in fact used chemical weapons on the Kurds.” *29

D6.17 The present Prime Minister, Mr John Major, was present at the OD meeting as the very recently appointed Foreign Secretary. *30 On 25 July 1989, the day he took up office, he received a briefing on the Hawk Project. The briefing, after referring to the Guidelines as announced in 1985 informed Mr Major that “Since the ceasefire in August 1988 the Guidelines have been applied with greater flexibility for Iraq (but, since last February, with much greater rigidity for Iran ....)” but that “Our public presentation of our policy on arms supplies to both countries has, however, stayed broadly the same.” *31 After referring to the public and Parliamentary criticism which would occur if a decision were taken to allow the project to go ahead the briefing warned that “Whatever the arguments we would use to justify the sale on technical grounds, many would not be convinced that Ministers had not decided to breach the guidelines limiting the sale of military equipment to Iraq.” A paper commenting on the Defence Secretary’s memorandum formed part of the briefing. *32 Under the heading “Compatibility with the Guidelines”, the paper pointed out that “While we can argue this contract would not contravene defence sales guidelines, we risk accusation that we interpret guidelines to suit our convenience.” On 26 July, another senior FCO official warned Mr Major that “the [Hawk] contract will be seen to be in clear contravention of the guidelines on defence sales to Iraq and Iran.” And a revised brief dated 26 July submitted by Mr Young warned that while it was “technically possible to argue Hawk within the established guidelines” it would be “difficult to square this with frequent assurances to Parliament about strict limitations on arms supplies to Iraq” and repeated that there would be a “risk of being accused of shifting guidelines to suit our convenience.” *33 An undated suggested “Contingency Press Line” to explain the rejection of the BAe proposal was “After careful and thorough consideration the Government concluded the sale of Hawk to Iraq would be incompatible with the guidelines on defence sales to Iran and Iraq” and, if the Government were “pressed on other reasons (human rights/chemical weapons and Kurds/hostages)” that the answer should be “Of course account was taken of all prevailing circumstances, but main consideration the defence sales guidelines.” *34

D6.18 Mr Major was, not surprisingly in view of his briefing, opposed to the BAe Hawk proposal. He had earlier, when Chief Secretary of the Treasury, made clear that ECGD backed credit would not be available to support the sale. In evidence to the Inquiry he said: “I did not think it was a very good deal financially. I did not believe it was a very good deal morally either.” *35 He explained that “The Hawk trainer, as trainer, was non-lethal. The Hawk trainer, as altered to use chemical weapons, would certainly have been lethal, and the view I took at that time was that it was far too high a risk with the particular regime in Iraq, that that might happen.” *36 He said: “I was intending to argue and did argue at the OD meeting against the Hawk being sold.”

D6.19 Both Lady Thatcher and Mr Major described the meeting as being a very short one. Mr Major recalled “.... the Prime Minister started the meeting by saying she was very dubious about it. She argued against it. It was then mentioned, by the Trade and Industry Secretary *37 I think, that there should be no ECGD cover. Then I spoke saying I did not think it could be squared with the Guidelines and in any event it was wrong. Nobody dissented .... and the actual discussion over the sale of the Hawk trainer, in OD, could not have lasted more than two or three minutes in total because there was unanimity we should not proceed.” *38 Lady Thatcher recalled that “.... it took my colleagues in Cabinet at that meeting only about five minutes and I eventually said to them ‘Does anyone wish to argue to the contrary?’ Not a single person did.” *39

D6.20 I have referred to Lady Thatcher’s and Mr Major’s evidence as to the course taken by the proceedings at the OD meeting in order that the official Minutes *40 of that meeting may be set in context. The Minutes suggest a very much more detailed discussion of the Hawk Project than the evidence of the proceedings given by Lady Thatcher and Mr Major warrants. The Minutes record an opening statement by way of explanation of the issue made by the Defence Secretary and a “summing up” by Lady Thatcher. But, on the evidence, the discussion was opened by Lady Thatcher and her views were, after a very short discussion, accepted, by all those present. *41 The record in the Minutes, however, of Lady Thatcher’s so-called “summing up” does correspond with the reasons, given by her in her evidence to the Inquiry and foreshadowed by Sir Charles Powell’s submission to her of 26 July, for opposing approval of the BAe proposal. It is important to notice the absence in her reasons of any reference to the Guidelines. Her reasons were not based on the Guidelines. It is important, also, to keep in mind the FCO’s Contingency Press Line which attributed a refusal of the BAe proposal to incompatibility with the Guidelines.

D6.21 An issue has arisen as to whether or not Mr Alan Clark was present at the Hawk meeting on 27 July. Mr Clark has given written evidence to the Inquiry that he was present and that it was he who made the remark, attributed by Mr John Major, the then Foreign Secretary, to the Trade and Industry Secretary, about ECGD cover. *42 Mr Clark added “It is true that the discussion [at the Hawk meeting] was extremely short. Notably because I lost my nerve!” However, the attendance list attached to the official Cabinet Office minutes of the Hawk meeting does not show Mr Clark as being present; *43 nor is there any record of any departmental briefing preparatory to the meeting being supplied to Mr Clark; nor was a copy of the Hawk OD paper issued to him. It may be, therefore, that Mr Clark’s recollection that he was present at the meeting is mistaken. Sir Robin Butler has so contended.

D6.22 Following the 27 July meeting it was left to MOD to inform BAe of the decision. Some Press interest was anticipated and, according to an FCO telex to Baghdad, the FCO, DTI and MOD agreed that the MOD would use the following Press line:

D6.23 On 28 July 1989 Mr N W Angel, Chairman of Aircraft Equipment International Ltd, had written to Mrs Thatcher in terms critical of the decision (reported in the Financial Times) to withhold support from the Hawk project. *45 Mrs Thatcher replied by a letter dated 21 August 1989, in terms of a draft provided by FCO/MED. *46 The letter set out the text of guideline (iii) in its original 1984 form, said “That policy still applies” and that “these restrictions on defence sales are kept under constant review and are applied in the light of prevailing circumstances, including the ceasefire....” and then explained the Government’s decision thus:

The letter avoided saying that the reason for the decision was incompatibility with the Guidelines. It did not in that respect follow the “Contingency Press Line” that had been suggested in the FCO briefing for Mr Major or the Press Line agreed between the three departments following the meeting.

D6.24 However, a letter dated 31 July 1989 from Mr Major, in response to a letter dated 24 July from the Archbishop of Canterbury *47 expressing concern about the possibility of the sale of Hawk trainer jets to Iraq, did follow the Contingency Press Line. The letter explained the Government’s decision that the Hawk project should not go ahead by saying: “Our firm conclusion was that given the fragile state of the ceasefire the sale of Hawk was not compatible with the guidelines which limit our defence exports to both Iraq and Iran. These guidelines, which we put in place during the Iran/Iraq conflict, prevent the export of any equipment which would significantly enhance the military capability of either side. We do not want to run the risk of our efforts to safeguard the ceasefire being undermined by the sale of Hawk.... We naturally looked hard also at other considerations, including Iraq’s human rights record and the possible implications for the hostages in the Lebanon.... As you know, we have tackled Iraq vigorously over its treatment of its Kurdish minority. That policy will not change. I should add that we do not allow the export of equipment to any country if we judge it is likely to be used for [the] purpose of internal repression.” *48 The letter concluded with a post-script: “I am sure - on every count - that it is right not to support this sale.”

D6.25 In written evidence to the Inquiry Mr Major said that the statements in his letter to the Archbishop were accurate. *49 Mr Major’s letter, in attributing the main reason for the rejection of the Hawk project, to incompatibility with the Guidelines, followed the convenient line that had been agreed upon in the FCO and with the other departments following the meeting. The main reasons for the rejection were not incompatibility with the Guidelines, but were those reasons given by the Prime Minister in her “summing up”. These reasons were encompassed by the “other considerations” to which Mr Major’s letter referred. *50

D6.26 The same FCO line was followed in a letter dated 1 August 1989 from Mr Waldegrave to Lord Hylton, who had enquired about the Hawk project. The letter said: “As you will now be aware, Ministers have decided this project should not go ahead. Export licences to allow BAe to export Hawk to Iraq will not be issued. We had to look carefully at an issue of such importance. We concluded that given the fragile state of the ceasefire the sale of Hawk was not compatible with the export guidelines for Iraq and Iran with which you are familiar. We do not want to run the risk of our efforts to secure peace in the Gulf being undermined by the sale of Hawk. You well know our attitide to the particular problems of the Kurds and the active steps we have taken with the Iraqi authorities. I can assure you that this policy will continue” *51. In a letter dated 9 August 1989 *52 and in two letters dated 10 August 1989 53 Mr Waldegrave said that the Government “...considered this request carefully, and advised the company that the [Hawk sale to Iraq] would be inconsistent with the guidelines”. In these letters, too, the Guidelines were being used as a convenient peg on which the Government’s decision to refuse approval of the Hawk project could be hung. Mr Waldegrave had not been present at the 27 July meeting and his knowledge of the basis on which the decision to turn down the Hawk project had been taken must have derived from the official Minutes. But the Minutes did not suggest that the main reason for the decision was incompatibility of the project with the Guidelines.

D6.27 The attribution, in the letters to which I have referred, of the Government’s decision on Hawk to the Guidelines is a very good example of the FCO’s preference for the presentationally convenient, as opposed to the factually accurate, answer. The letters could have said that, after careful consideration, the Government had decided it would be wrong to approve the supply to a regime with a record of chemical attacks on its Kurdish citizens of aircraft which could easily be adapted for the purpose of such an odious use or for the purpose of other aggressive operations. If the letters had been on those lines, the readers would have received an accurate impression of the Government’s reasons, wholly creditable as the readers would surely have concluded, for rejecting the Hawk project. But the FCO perhaps feared that frankness of that nature might have provoked the Iraqis, with consequences detrimental to British trading interests or detrimental to the prospects of release of Mr Richter and Daphne Parrish. Hence the public attribution of the decision, convenient if inaccurate, to the Guidelines.

D6.28 Letters explaining the Government’s decision on Hawk were written also by Mr Alan Clark, who in July 1989 had become Minister (DP) at the MOD but who had previously been involved in the discussions as Minister for Trade at the DTI. He recollects having been present at the 27 July meeting although there is no documentary confirmation that that was so. Letters from constituents opposed to the sale of Hawk to Iraq had been referred to Mr Clark by Mr Timothy Raison MP and Ms Dawn Primarolo MP. Mr Clark’s letters to the two MPs in response, both dated 11 September 1989, were in identical terms. After referring to the Guidelines the letters explained the Government’s decision thus: “BAe asked the Government whether or not a sale of Hawk trainer aircraft to Iraq would fall within these guidelines. The Government carefully considered this and has advised the company that such a sale would be inconsistent with the guidelines.” *54 The explanation for the decision followed the line agreed between the departments following the 27 July meeting.

*3 - MOD/25.1.33 at paragraphs 4 and 7. See also the brief dated 21 April 1989 submitted to the Min (DP): MOD/25.1.103 at 105 et seq

*19 - The Hawk aircraft viewed as a combat aircraft would be ‘lethal’ and the supply would fall foul of guideline (i), irrespective of the impact of guideline (iii), whether in original or revised form

*20 - “.... payments overdue now total £77 million on ECGD’s existing £500 million exposure” (paragraph 11)

*21 - “BAe assess that Stage 1 could be worth some £1 billion and that, if all the possible follow on orders were achieved, the total could be £3 billion” (paragraph 15)

*23 - The Prime Minister underlined the adjective “offensive” - CO/32.PM/2.230 at 239

*24 - the transcript of Lady Thatcher’s oral evidence Day 48, 8 December 1993, p.141

*29 - The transcript of Lady Thatcher’s oral evidence Day 48, 8 December 1993 p.146

*30 - Mr Major was appointed Foreign Secretary on 24 July and took up office on 25 July 1989

*34 - FCO/13.2.389; a manuscript note by Mr Simmons dated 27 July described the Contingency Press Line as “A very basic skeleton with which News Department agreed” and continued “They are dealing with MOD, DTI and No.10. As MOD have led thus far on leaks, we agreed that authoritative confirmation should be theirs, backed up by other Press offices.”

*35 - The transcript of Mr Major’s oral evidence Day 55, 17 January 1994, p.24

*37 - Mr Alan Clark has said that it was he, not the Trade and Industry Secretary, who made the remark. There is a question, however, whether Mr Clark’s recollection that he was present at the meeting is correct. See paragraph D6.21 infra.

*38 - The transcript of Mr Major’s oral evidence Day 55, 17 January 1994 p.26. Notes made by Sir Robin Butler, Mr Appleyard and Mr Reeves at the meeting are consistent with Mr Major’s recollection of what occurred at the meeting. The notes were supplied to the Inquiry on 7 July 1995 (CO/466). Somewhat surprisingly the first references to the notes ‘existence were not made until the Inquiry received Sir Robin’s and Mr Reeves’ written comments dated 9 May 1995 and 15 May 1995 respectively.

*39 - the transcript of Lady Thatcher’s oral evidence Day 48, 8 December p.146

*41 - The explanation for the apparent discrepancy between the content of the Minutes and Lady Thatcher’s and Mr Major’s account of the proceedings at the meeting was given by Sir Robin Butler and “lies in the conventions [governing] Cabinet and Cabinet Committee minute-taking.” Sir Robin enclosed a copy of the Cabinet Office’s “Guide to Minute Taking.” The following paragraphs are in point:

Accordingly, the Minutes do not purport to record exclusively what was actually said at the meeting.

*43 - CO/7(5). Mr Reeves has told the Inquiry “...as minuting secretary of OD and other Committees, I invariably took the elementary precaution of checking the proposed list against the faces round the table. Since the list of names on the finished product does not include Mr Clark’s name, I am absolutely certain that he cannot have been present” (letter dated 16 December 1995 to the Inquiry).

*47 - FCO/49.2.195. The letter was addressed to Mr Major’s predecessor as Foreign Secretary, Lord Howe

*49 - Written statement dated 12 January 1994 pp.10 and see the transcript of Mr Major’s oral evidence Day 55, 17 January 1994 pp.45-47

*50 - The Archbishop’s letter was answered also by the Secretary of State for Defence, Mr Tom King. In a letter dated 23 August 1989 Mr King emphasised the point that “In all our considerations of potential defence sales world wide it is a fundamental ground rule that we do not export anything which we judge likely to be used for internal repression.” MOD/40.3.167

*The Full report is available from The Stationery Office Ltd., PO Box 276, London, SW8 5DT.