Kenny Farquharson: We can't afford to be morally bankrupt

I ONCE spent a very enjoyable day wandering around various Glasgow pubs getting gently sozzled with Alan Clark, the maverick Tory MP and diarist. The conversation touched on women, whisky, Jaguar cars and salacious political gossip, but eventually got round to the subject of Matrix Churchill. This was the Coventry firm that illegally exported arms manufacturing equipment to Iraq in the 1980s, while the Tory government turned a blind eye.

Clark, a former trade minister, famously admitted under oath that he had been "economical with the actualité" about the extent of the Tory Government's complicity in the Matrix Churchill deals. In a pub next to Glasgow Central station, Clark was unrepentant about his cavalier attitude to the arms trade. That was simply the way the world worked, old chap. If we didn't deal with Saddam, someone else would. Realpolitik, and all that.

This pub conversation came vividly to mind last week when the High Court ruled the UK Government had acted unlawfully in halting a Serious Fraud Office inquiry into bribery and kickbacks in arms deals between BAE Systems and Saudi Arabia. The reasons given by the Labour Government for blocking the BAE investigation were exactly the same as those used 20 years ago by the Tory Government over Matrix Churchill – that extreme measures were necessary to allow the security services access to intelligence information that was essential to the defence of the realm.

The Saudis had threatened that if the investigation went ahead, and the reputations of corrupt Saudi princes were trashed in London's law courts, Saudi Arabia would stop sharing its extensive intelligence about Islamic terror networks with MI6. It was blackmail, plain and simple, and Britain, to its shame, caved in to it.

Any involvement in the arms trade will be fraught with moral peril. But the ability shown by some politicians to embrace Britain's moral bankruptcy in its dealings with the Saudis is simply breath-taking. Last week Sir Malcolm Rifkind, the former Foreign Secretary, had great fun in the BBC Newsnight studio effectively telling Lib Dem leader Nick Clegg he was a silly boy who knew nothing of how the grown-ups played real politics. Here's a useful rule of thumb in such matters: when someone justifies their position on the grounds of realpolitik and a worldly-wise insistence that they know best, they are invariably defending the indefensible.

In a letter to the Prime Minister last week, Clegg asked the following question: "How can Britain stand up to corruption and bribery abroad if we are not spotless at home?" The Lib Dems' habitual piousness may not be to everyone's taste, but in this case Clegg is right. The world has moved on from the days of Matrix Churchill, but the lessons do not seem to have been learned. Britain has since fought two wars against the Iraqi regime that Alan Clark played footsie with back in the 1980s, and there are new and compelling reasons why Britain's moral credentials must be kept as grime-free as possible. As we tackle poor governance and corruption in Africa; as we try to persuade the developing world to use less fossil fuel; as we try to limit nuclear proliferation; as we support fragile governments in Afghanistan and Iraq; we cannot afford to do so from a position of compromised values.

Kowtowing to the House of Saud leaves a sour taste in the mouth for many reasons. Strip away the luxury jets, the Knightsbridge mansions and the lavish consumerism, and the way the Saudi royal family operates is almost medieval – especially in its treatment of women and its barbaric justice system. Of course, as the most powerful Sunni Muslims in the world the Saudis are invaluable allies of the West in the struggle to quell international terrorism. But must that assistance be secured at any price?

The usual argument trotted out in these circumstances is that we in the west have to respect the way the Saudis do business and not impose our Western values on them. This is surely taking traditional British deference too far. The possibility that it could possibly work the other way round, and that the Saudis might respect the way we do business instead, does not seem to figure. This is morally vacuous.

When Robin Cook became Foreign Secretary in 1997 he promised "an ethical dimension" to British foreign policy. Just a few years later this was regarded by many Labour politicians as something of an embarrassment as they developed a taste for the untrammelled exercise of ministerial power and diplomatic wheeler-dealing. Well, it is time the Labour Government revisited the Cook doctrines.

This weekend it looks like the Tories will back the Government over new laws that would allow ministers to block future criminal investigations if they judged there was a threat to national security. Since 9/11 there have been trade-offs between liberty and security, many of them justified given the seriousness of the threat from extreme Islamists. But this is surely one too far.

In his High Court judgment last week, Lord Justice Moses declared: "No one, whether within this country or outside, is entitled to interfere with the course of our justice. The rule of law is nothing if it fails to constrain overweening power."

If we accept any exceptions to that principle, for whatever purpose, we jeopardise not only our freedoms at home but also our ability to do good in the wider world. This would not only be a tragedy, it would be an abdication of responsibility.

That, to borrow from the language of Alan Clark, is the actualité.