Iraq evidence barred 'without question': Baker did not make inquiries before issuing immunity orders

KENNETH BAKER, the former Home Secretary, ordered the withholding of evidence vital to defendants in two arms-to-Iraq trials without asking questions, the Scott inquiry was told yesterday.

Mr Baker, a close ally of the former prime minister, Baroness Thatcher, claimed that he was acting in the national interest when he twice signed Public Interest Immunity (PII) certificates preventing evidence about the intelligence services being revealed in open court.

The evidence he wanted kept secret concerned businessmen from the Matrix Churchill machine tool company and Ordtech, a Reading- based military engineering firm, accused of breaching export regulations by illegally selling defence equipment to Iraq. In both cases, the businessmen claimed the evidence would prove their innocence because the Government had endorsed the exports. Detailed information about their dealings with Baghdad had been regularly passed to MI5 and MI6.

Mr Baker said that his 'number one concern' was to prevent disclosure of information that compromised the intelligence-gathering networks, its employees and informants. He was not aware of the defendants' case or the relevance of the intelligence. The Attorney-General, Sir Nicholas Lyell QC, had approved the PII certificates and he assumed that, as the senior law officer, he had taken the legal implications into consideration.

Mr Baker claimed that Customs officials, who were prosecuting, assured the Home Office legal adviser, Wally Hammond, that the evidence being withheld in the Matrix Churchill case was only of 'marginal relevance' to the defence. He admitted he had no idea the firm's managing director, Paul Henderson, who was on trial, had been an MI6 informant. He was told by a senior Home Office civil servant, Sir Clive Whitmore, that there were no reports about the case.

Lord Justice Scott said that he found it hard to see why Mr Baker, MP for Mole Valley, failed to make further inquiries. 'It is the absence of any questioning that I am finding a little difficult to understand. There was a pretty shrewd notion in government circles what the defence would be,' he said. He was also concerned that both certificates were drawn up so broadly as to prevent any reference being made to the intelligence services.

Mr Baker said that he was following precedents set by previous Home Secretaries in trying to protect a 'class' of information about the intelligence services rather than specific documents. PII certificates were not the 'end of the road' - the aim was not to disbar evidence but to alert the court to the potential risk to national security which might be damaged by the 'inadvertent blurting out' of names of agents or informants in court. 'It could not only lead to the security services being made valueless but to certain people being exterminated and done away with,' he added.

Mr Baker denied trying to prevent a Metropolitan Police Special Branch officer, Stephen Wilkinson, giving details of his contacts with the intelligence services during the Ordtech case. The officer, called as a defence witness, was to have given evidence supporting the claim that information about Ordtech's military sales had been passed on to intelligence agencies.

In neither case were the certificates signed by Mr Baker actually used. Four Ordtech defendants were advised to plead guilty after the trial judge at Reading Crown Court accepted a PII certificate signed by Peter Lilley, when Secretary of State or Trade and Industry. They received suspended prison sentences or fines but are appealing.

The inquiry continues today.