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Just what they need - a �28m air defence system Cabinet rift over support for BAe sale to one of world's poorest countries David Hencke and Larry Elliott Tuesday December 18, 2001 The Guardian Tony Blair was at the centre of a Cabinet row last night after it emerged Downing Street was backing plans for the sale of a British-made military air traffic control system to Tanzania, one of the world's poorest countries, despite ferocious opposition from the chancellor, Gordon Brown, and the international development secretary Clare Short. Sources at the Treasury and the Department for International Development said Mr Brown and Ms Short would strongly oppose granting an export licence to the defence firm BAe Systems for the �28m project. The contract has been condemned as a waste of money by the World Bank for a country that has just eight military aircraft and a per capita income of �170 a year. Half of Tanzania's population lacks access to clean water and a quarter of children die before their fifth birthday. The deputy prime minister, John Prescott, has now been asked to intervene in the dispute over whether safeguarding 250 BAe jobs on the Isle of Wight should take precedence over Labour's commitment to development goals and an ethical foreign policy. Amid reports that No 10 has been using strong-arm tactics to win over the Foreign Office and the Department of Trade and Industry, Mr Prescott will chair a Cabinet committee meeting on the issue today. "The whole thing stinks," said one government source last night, adding that a World Bank-commissioned report had concluded Tanzania could buy a new civil air traffic control system for a quarter of the price of the BAe deal. Ms Short and Mr Brown believe Tanzania should use the benefits of a �1.4bn debt relief package announced by the World Bank and the International Monetary Fund last month to boost spending on health, education and basic infrastructure rather than on what one source called "unproductive" expenditure. "The prime minister has proudly talked about his Africa initiative," a government adviser said last night. "If he really cares about Africa this is a test case for him." The Cabinet row has been festering since August, but has come to a head since the September 11 attacks, which have led to BAe Systems citing imminent job losses and production cutbacks in an intensification of its lobbying of No 10 for an export licence. Although the previous foreign secretary, Robin Cook, opposed the licence, the present incumbent, Jack Straw is backing the prime minister and the defence secretary Geoff Hoon in their support for the company. Patricia Hewitt, the trade secretary is in neither camp but is said to be anxious not to pick a fight with Tony Blair. The World Bank study is highly critical of the technology of the system, let alone the debt problems it will cause Tanzania. The report says the BAe system is "too expensive and not adequate for civil aviation". It said the system's transmitter has already been superseded and will need an expensive maintenance agreement unless this is underwritten by BAe. It adds that to protect the system during wartime will require "extremely expensive design specifications". BAe said yesterday it had not seen the report and did not want to comment on it. The company said the order would sustain British jobs and added that Tanzania had passed tests on whether it could afford it. The scheme was condemned yesterday by Oxfam, whose policy director, Justin Forsyth said: "The news that the government is thinking about agreeing this deal is deeply disturbing. It exposes a huge flaw in the UK arms export bill, which at the moment puts profits before people. The World Bank have said they won't touch this deal with a bargepole - the government should think very carefully about the impact it could have on the people of Tanzania." The order will cause a parliamentary row today when the Commons new scrutiny committee - composed of the chairs of the defence, foreign affairs, trade and industry and international development committees - meets for the first time. The committee has been banned by Ms Hewitt from seeing details of the contract on the grounds that MPs were recently blocked from "prior scrutiny " under the government's export control bill for fears of leaks. Her move will anger MPs already furious about government backtracking on the openness promised when it was elected. The ex-minister Tony Worthington, who tried to amend the bill to allow scrutiny, said yesterday: "On one hand we are forgiving debt, while on the other we are adding to Tanzania's debt with this order." Guardian Unlimited � Guardian Newspapers Limited 2001 ==^================================================================ This email was sent to: [email protected] EASY UNSUBSCRIBE click here: http://topica.com/u/?a84x2u.a9WB2D Or send an email to: [EMAIL PROTECTED] T O P I C A -- Register now to manage your mail! http://www.topica.com/partner/tag02/register ==^================================================================
