Heseltine feared Iraq cover-up

MICHAEL HESELTINE refused to sign a 'gagging order' witholding Whitehall documents vital to the Matrix Churchill defendants because he did not want to appear to be part of a government cover-up, the Scott inquiry was told yesterday.

The President of the Board of Trade believed the case for releasing the documents was 'overwhelming'. He agreed to sign a Public Interest Immunity certificate (PII) only after 'significant amendments' and Sir Nicholas Lyell, the Attorney General, had told him he had a duty to sign and could not refuse.

Mr Heseltine also received assurances that his concerns would be relayed to the trial judge. Sir Nicholas told him the unusual drafting of his certificate would alert the judge and jury and that the point could be reinforced orally, if necessary, by counsel for the prosecution. He later learnt the trial judge was not informed.

After the trial collapsed he found it 'incredible' when the Attorney General, contrary to previous advice, said ministers did not have a duty to claim PII in every case where documents were sought.

Last night, Sir Nicholas sought to pre- empt any attempt to make him a scapegoat. A statement from his office said: 'The Attorney General's advice on PIIs has remained consistent. The fact that it is for the court to determine the balance of the overall public interest was pointed out in Mr Heseltine's PII certificate.' The PII shown to the judge was 'expressly amended' after consultation with Sir Nicholas and counsel for the prosecution.

Mr Heseltine told of his growing unease when first asked to sign a PII. He thought it odd the defendants were not being prosecuted for exporting equipment contrary to government restrictions but because they had lied about it. He learnt the Government failed to revoke export licences despite knowing equipment was destined for Iraqi munition factories, and had granted new licences. There were also close links between the security services and Matrix Churchill.

Mr Heseltine felt he was being asked to prevent such information being used legitimately by the defence.

Concerned at not being given sufficient time to consider the implications, he called senior officials to an emergency meeting. There he refused to sign the PII, which stated the documents' disclosure would be 'injurious to the public interest'. One concern was if the PII was overruled by the judge, making it look as if he had been part of a cover-up. 'As far as I was concerned, I had read enough to satisfy myself these documents were relevant and should not be withheld.'

Quoting Winston Churchill, he told officials: 'Up with this I will not put.'

He discussed his refusal with the Attorney General, who told him he had a duty to sign to protect a class of government documents. He said he supported the principle of protecting officials' advice to ministers, but insisted his PII be altered to 'flag up' his worries to the judge.

After the trial collapsed he urged John Major not to answer any more parliamentary questions. He warned that ministers were on 'shifting sands' and matters should be left to the Scott inquiry which it had just announced.

The inquiry resumes tomorrow.