Alan Watkins: 'Have nothing to do with yachts'

The late Lord Beaverbrook used to advise the promising young men on his newspapers to steer clear of yachts. He called them "yatts". He would say: 'Have nothing to do with yatts. They make off with all ya money. And ya have nothing to show for it in the end." I have never owned, hired or even been invited on to a yacht in my whole life.

Lord Beaverbrook, however, did have a yacht. But it was a very small one, hardly larger than what used to be called a launch, and I was never asked on board. It was certainly smaller than the monsters which now clutter up the sunnier seas of the planet.

Mr Peter Mandelson is clearly no stranger to these enormous vessels. Nor, equally evidently, is Mr George Osborne. But we should not judge them harshly on that account. Travelling around in a boat, whether moving or stationary, has always seemed to me, to adapt Samuel Johnson, to combine the hardships of the prisoner with the perils of the mariner. But that is for others to decide for themselves.

In any case, it was the Russian oligarch who owned the boat, and Mr Rupert Murdoch who owned another one, though knowing the latter by reputation, I suspect he would have hired a yacht on preferential terms. Mr Nat Rothschild owned or, at any rate, possessed a villa in Corfu. For, as I say, the precise legal relationship of rich people to their possessions is often obscure. And, as all big boats are yachts, so are all houses, in sunnier climes, called villas.

It has all been a marvellous distraction from the events of the last few months. As a subject, politics never lets you down. The arguments for and against the existence of God can be gone into again and again and there is still an end: the number of things men and women can get up to in bed is limited: but in politics there is always a surprise in store. The first surprise was that Mr Gordon Brown brought back Mr Mandelson into the Cabinet at all. Everything else has flowed from this.

Mr Mandelson chose to speak disobligingly of Mr Brown to Mr Osborne and to others also. Their host was Mr Rothschild. It was not clear that the words complained of (as the libel lawyers like to put it) were spoken at Mr Rothschild's house, at a restaurant on the island or in both places. He may have dilated on Mr Brown's inadequacies in both locations or all over the place. Who can say?

At all events, Mr Osborne chose to tell his tale to what journalists call another Sunday newspaper. Mr Mandelson's remarks would have been interesting enough in themselves. Even so, the paper might have been justified in keeping them quiet, or consigning them to a gossip column or a line of political commentary. After all, Mr Mandelson had at that stage retired from British politics. He held no high opinion of the Prime Minister, and the Prime Minister, so far as most people could say, held a similar view on Mr Mandelson.

What was surprising was not that Mr Mandelson held the view he did of Mr Brown but that Mr Brown invited him to join or rejoin the Government. It seems to me only proper for the paper to publish Mr Mandelson's opinion. It seems to me equally correct – though I am in a minority – for Mr Osborne to give Mr Mandelson's opinions a wider circulation,

such as they were at the time. It is, once again, an illustration of that old English game of hunt-the-issue. It always becomes "the real issue". It is not whether such-and-such is true but, rather, whether so-and-so was entitled. In this case the initial question – whether Mr Mandelson spoke disobligingly of his present head of government – has been transformed into whether Mr Osborne let down his host, Mr Rothschild.

The next question is whether Mr Osborne so misused his position by soliciting donations to the Conservative Party from a rich Russian who was, as the police say, in the vicinity, though others, including Mr Murdoch and his relations, were in the district as well. There is clearly a gap in the law whereby foreign nationals can channel gifts through companies registered in the UK.

It appears that, for whatever reason, no money went winging its way to the Tories. But the Electoral Commission, which is there to supervise these matters, should have begun to investigate the position, both generally and in relation to Mr Osborne. It was certainly no answer for the commission to put up a notice as saying "case dismissed" where there had not been even the most cursory examination of the case in the first place.

To a limited extent, perhaps, Mr Rothschild could have proved a public benefactor. I am, however, left feeling a little worried by the role played by Mr Rothschild – or, come to that, by Mr Mandelson. People can become extraordinarily sensitive about social matters. Let me provide an illustration of what I mean.

Some years ago, I attended a party at which several Tory ministers were present, including the then Welsh Secretary, an Englishman. I mentioned the recent success of the British Isles rugby team, that it had included numerous Welsh players and that he ought to hold a reception for the players involved, whether from Wales or the whole party. He looked blank – no rugby follower he – but he promised without enthusiasm to look into the matter.

Whether the celebratory event was ever held I have now forgotten. But when I mentioned the episode earlier in print, my host, another Tory minister, whom I knew well, rebuked me for betraying a confidence. I told him not to be so bloody silly, and we remained friends until his death.

Mr Rothschild likewise seemed to be flinging his protective cloak over a motley crew. It was surely nothing to do with him what Mr Osborne chose to say about Mr Mandelson or what Mr Osborne chose to say to the papers. Mr Rothschild then elected to write to another paper, saying that Mr Osborne had been up to no good in trying to solicit cash for the Conservatives.

So if Mr Osborne told tales about Mandelson – which I believe he was perfectly entitled to do – it did not follow by any means that Mr Rothschild was entitled to tell tales about his guests' relations with a Russian entrepreneur. As far as I know, there is no evidence that Mr Mandelson took his revenge on Mr Osborne. He did not say to Mr Rothschild: take up your pen and write. But it certainly looks as if that was what more or less took place.

My own record, for what it is worth, is of charity towards Mr Mandelson. His second resignation, about the passport application, was the consequence of hostility by Mr Alastair Campbell and panic by Mr Tony Blair. His first resignation about the mortgage led me to defend him. I wrote at the time that the identity of those from whom he had borrowed money was, or ought to be, entirely his own business.

But he seems to have the knack of causing trouble for all with whom he comes into contact. The latest victim of the curse of Peter is George Osborne.