From Scotland with love, a little conscience money


Part 1: The widow’s mite – By Kenneth Roy

The Scottish Government has found it possible to congratulate itself publicly for donating £120,000 to Oxfam from the proceeds of a Scottish crime. The money will be used to help ‘some of the world’s most vulnerable women’, said cabinet secretary for external affairs, Fiona Hyslop. Keep the size of the cheque in mind: £120,000.

Now consider the ‘benefits’ awarded to a man called Jon Stanton between his arrival in Scotland in April 2010 and the end of that year. His employer paid him £208,407 ‘mainly in relocation costs’ as part of a total package of £732,573 received in his first eight months in his new job.

In December 2010, his employer, the Weir Group, was fined £3 million and had illegal profits of almost £14 million confiscated. Mr Stanton, the group’s new director of finance, was quite blameless. He wasn’t even around when the crime was committed.

Nevertheless, these figures bear some comparison.
The much-trumpeted donation of £120,000, proudly announced as a measure of Scotland’s ‘distinctive’ contribution to international aid and the source of an easy PR hit for the external affairs secretary, has been drawn from the proceeds-of-crime bounty collected by the Crown Office as a result of its prosecution of the Weir Group for corrupt practices.

Over a three-year period, the company made illegal payments of £3 million to Saddam Hussein’s regime, in order to secure business contracts worth £35 million, and paid a further £1.5 million to an agent in Iraq who channelled these ‘kickbacks’ to Saddam’s henchmen. The group had a simple choice: pay the kickbacks, bust the sanctions and secure the contracts; or not pay the kickbacks, respect the sanctions and lose the contracts. They chose the criminal course of action.

It is scarcely necessary to add that none of the Weir Group’s illegal funding of the Saddam regime was used to benefit the people of Iraq. Now – a decade after this disastrous set of events was set in motion – a tiny donation  is going from Scotland to help the innocent victims of successive wars, these ‘vulnerable women’ of whom Fiona Hyslop speaks. They are the widows of Iraq.

So token, however, is this Scottish conscience money that it is £88,407 less than the ‘mainly re-location costs’ of one Weir Group director; £62,500 less than the annual fees of Lord Smith of Kelvin for his part-time chairmanship of the company; and £1.1 million less than the annual salary of the group’s chief executive, Keith Cochrane, who joined in 2006 long after the corruption.

It is also worth putting into perspective the apparently punitive fine imposed by Lord Carloway at the High Court in Edinburgh. Three million pounds sounds a lot until it is set within the context of the 2010 profit of the Weir Group: £309 million. Mr Stanton, who would have had to authorise the cheque, would, like any good finance director, have calculated as he did so that it represented slightly less than 1% of that profit. And the £14 million seized in addition to the fine? Why, this was merely reclaiming the profits already illegally made on the deals – so net loss, nil.

Although the headlines suggested otherwise, the group got off remarkably lightly: the punishment hardly made a dent in the Weir Group’s slurry pump. And no one – but no one – went to prison. Indeed the only Scot of note who was faced with a prison sentence in December 2010 was the former socialist MSP Tommy Sheridan, who is still inside.

Back, then, to that £120,000 donation. It’s the sort of figure that would not even be noticed by the Weir Group’s top management. We have the company’s word for that. When it was challenged on its criminal payments to Saddam, it said that £300,000 (the average amount of each of the kickbacks) was not the sort of money likely to come to the attention of what it called ‘the executive’. But to the Scottish Government it seems to be quite a big deal; anyway, enough to get the external affairs secretary excited.

So the week’s good cause at Holyrood – the object of all the back-patting – are the widows of Iraq. Estimates vary of the number of women in that country widowed by successive wars: the 10-year conflict with Iran, the first Gulf War, the 2003 US-led invasion, the sectarian conflict that followed. The aid agency Relief International claims there are 2.5 million widows; the ministry for women in Iraq puts the figure at 2 million; Oxfam – beneficiary of the Scottish Government’s ‘distinctive’ approach to international aid – prefers 740,000 (how can it be so precise?); while the BBC’s figure is 1 million.

The truth is that no one knows. ‘We found that many of the husbands had just vanished without trace and are categorised as “Death Without News”‘, said the film-maker Carmen Marques. Nor is it known how many children are fatherless; as one Iraqi specialist said, ‘This figure is simply inestimable’, but given the size of many families in Iraq, it is generally acknowledged that it runs into millions.

The scale of the tragedy is immense and threatens the fragile social fabric. Iraq has been called ‘A nation of widows’ and the evidence is everywhere. Begging widows are commonplace and many live in appalling conditions – an estimated 25% are without access to water. Some resort to prostitution, while others enter into temporary marriages based on sex with the bureaucrats who administer the limited funds for which the women are eligible. But only one-sixth of Iraqi widows qualify for any federal aid.

Fiona Hyslop claims that ‘Scotland is making a difference’ to these women with its £120,000 donation, and this claim has been repeated unchallenged. The question is: how much of a difference? If we discount both the highest and lowest estimates of the number of Iraqi widows, and settle for the BBC’s compromise figure of 1 million, and if we go on to assume hopefully that all of the Scottish Government’s money will actually reach the women in need, then here is what Scotland’s donation is worth to each of the Iraqi widows:

12 pence

Still, this is better than nothing; and to it must be added the £1.5 million that the Scottish Government is donating, also from the proceeds of the Weir Group’s crime, to a water infrastructure development in Iraq and other projects there and in Afghanistan. It seems the rest of the proceeds – £12.4 million – is staying in Scotland to fund unspecified ‘community projects’. (How does one apply?).

On the official website of the Weir Group, there is a section headed ‘News’. Anyone visiting the site this morning expecting ‘news’ of the group’s response to this initiative of the Scottish Government would be disappointed. News of it there is none. The proceeds of its own crime, and the destination of these proceeds, seems not to be news to the Weir Group, where it is very much business as usual. But no amount of airbrushing its past will quite eradicate the nasty stain.

In part 2 tomorrow: the cover-up


Courtesy of Kenneth Roy – read Kenneth Roy in the Scottish Review