Like many, I favour a judge-led inquiry into the banks fiasco. But what could it realistically achieve?
Poor parliament. Its powers stripped by the European Union, the courts and the devolved assemblies. Its proceedings controlled by the executive. Its members so mocked by the media and the public it appears that the British loathe the sight of their politicians, and wish only for an escape from representative democracy.
As soon as a crisis begins, the cry goes up for an outside agency to take charge: for the unelected officials of the Bank of England to acquire more powers; for the Office for Budget Responsibility to deliver accounts of the national debt politicians cannot be trusted to provide. As soon as a scandal emerges, offended parties call for lawyers to hold “independent” inquiries and judicial reviews.
Bob Diamond’s condescension to the Treasury select committee demonstrated the ignominy into which parliament has fallen. Diamond would never have dared address a judge by his or her first name. But the gilded banker felt no qualms about calling the gelded members “Jesse”, “Andrea”, “Michael”, “David” and “Andy”. If he had been before a judge, Diamond – or should that be “Bob” or maybe “Bobby”? – would have made sure that his evidence was beyond reproach.
As it was, when Andrew Tyrie, the committee chairman, asked: “Is it true the FSA [Financial Services Authority] was concerned about your appointment as chief executive and sought assurances there would be a change of culture?” Diamond replied: “I got very strong support for my appointment to chief executive.” Maybe the £120m he pocketed between 2005 and 2012 clouded his memory, but letters from the FSA in Tyrie’s possession showed that it was concerned about Diamond’s promotion and wanted assurances from the Barclays board that its aggressive culture would change.
Add in the sight of George Osborne and Ed Balls turning the ruin of the hopes of millions into an excuse to abuse each other, and the case against parliament seems complete.
But you cannot escape politics, nor should you want to. Although, like many others, I want a judge to investigate the worst riot of capitalism since 1929, I know that the history of judicial investigations into politically sensitive scandals is mixed. They are like psychoanalysis: the process is revealing, but the conclusions are banal.
The evidence to the Leveson inquiry produced an exposé that tabloid journalism will never live down. But if you imagine that Lord Justice Leveson’s findings will force Jeremy Hunt to resign, remember the dashed expectations of all those who thought that Lord Justice Hutton’s inquiry into the Iraq war would force the resignations or Tony Blair and Geoff Hoon.
Or consider Lord Franks’s report on the Falklands war of 1982. The judge itemised all the blunders that allowed the Argentinian junta to invade. But he could not bring himself to hold a single minister responsible in his concluding comments. “For 338 paragraphs he painted a splendid picture, delineated the light and the shade, and the glowing colours in it,” said James Callaghan in the Commons debate on the Franks report. But “when Franks got to paragraph 339 he got fed up with the canvas he was painting, and chucked a bucket of whitewash over it”.
When they sit alone in their study, investigating judges must wonder what right they have to bring down politicians. Britain is a democracy, not a judgocracy. It is the job of MPs to end the career of ministers. If they do not, the voters can remove them at an election. Who are judges to interfere?
I have no way of knowing whether Leveson will break with tradition by forcing Hunt out, or instead apply the customary coat of whitewash. But there is a second restriction on “independent” inquiries he is already observing. If an investigating judge wants to change the law, he has to persuade the despised politicians to change it for him. During the Leveson inquiry, there was a telling, and alarming, moment when the judge explained to Michael Gove his plans for a new press regulator. Membership would be voluntary, but if a newspaper refused to join, the courts might hit it with “exemplary damages”, he said, because the paper could have had the libel or privacy action resolved “very easily” under the Leveson system.
The journalists he imagined defying him and receiving “exemplary” punishment were not the Peeping Toms of the tabloids but the staff of Private Eye, who expose corruption in the City, media, government and the law rather than find pleasure from making Sienna Miller cry. I had forgotten, until Leveson reminded me, that the legal establishment has always been the enemy of serious journalism. I was as struck by the judge’s reaction to Gove’s reply. The minister implied that Leveson was 30 years behind the times. Every web page was now a newspaper. Everyone who wrote online was now a journalist. Were all of them to submit to the judge’s new regulator or face “exemplary” punishments? A truculent note entered Leveson’s voice as Gove contradicted him. He realised that for his controls to work, politicians must approve them, and the politician in front of him would not.
People who hate all politicians end up hating themselves. By all means hate this minister or that party, but remember the difference between politicians and judges, journalists, bankers and European commissioners. The electorate can remove its elected representatives. Say that power does not matter because “they’re all the same” or “only in it for themselves” and you are denying the possibility of democratic renewal.
In their small way, the Commons select committees have been making the possible real. The public accounts committee (PAC) has responded to the crisis by pushing the permanent secretary at Revenue & Customs into taking early retirement because of his sweetheart deals with the vulture capitalists of Goldman Sachs.
The PAC and the other parliamentary committees could do much more, but they need help. The American equivalent of the PAC has 120 staff. A British committee is lucky to have just one clerk. Those who would deny our representatives resources because they think that all politicians are crooks are only serving the interests of Bob Diamond and his kind.
Leaving all other considerations aside, the prime minister establishes “independent” public inquiries, while select committees are free to examine what they will. When the prime minister refuses to initiate a judicial investigation into the banking scandal or any other scandal, we are where we always have been: stuck with parliament. A poor thing, but our own.
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We’re told Leveson-style tribunals can do no wrong. But lawyers’ obsession with cross-examination can hinder the search for truth
A fierce argument broke out in the Commons yesterday over inquiries. As the floodwaters of banking disaster recede, who should pick over the wreckage on the shore? For the prime minister this is a job for parliament. For the opposition leader, a job for judges. Ed Miliband said that if David Cameron does not hold a “judge-led inquiry” into banks, as he did into the press, “people will come to one conclusion: he can’t act in the national interest”. In a vote, Cameron won.
I can’t see much difference between a slow-moving, celebrity-infatuated judge and a bunch of MPs so dumb they would let mass murder off with a caution. Cameron is right that MPs are quicker and cheaper than judges, but Miliband makes a fair point that, if so, why did Cameron appoint Lord Justice Leveson to ramble interminably round the structure and ethics of the press. Is hacking voicemail really more sinful than bringing disaster to the entire national economy?
For the time being judges can do no wrong. Miliband speaks of a judge-led inquiry as if it were the second coming. To him, in a cynical and wicked world, the law is one profession that stands incorruptible, its wigs, gowns, breeches and stockings floating serene above the swamp. Should little Johnny want to be a banker, reporter or politician, we would hold our noses. Should he yearn for the Queen’s bench, we see in his hands the keys to paradise.
Judges consider themselves institutionally beyond correction. Even if “overturned on appeal”, they suffer no more than a ribbing at the Garrick. For half a century they have upstaged parliament as exorcists of the nation’s heebie-jeebies: Scarman on riots, Saville on Bloody Sunday, Scott on arms for Iraq, Phillips on BSE, Hutton on the death of David Kelly. One or two public servants get a nose in the trough – Franks on the Falklands, Layfield on Sizewell B – but lawyers have a near monopoly. The government maxim is: delegate inquiry and you delegate responsibility.
It does not always work. When Cameron had a spot of bother with News Corporation he kicked for this touch, but broke his ankle. Someone at Downing Street apparently asked for a “safe” judge from the usual channels (Ken Clarke’s justice department), not too ambitious, not given to costly delay, unlikely to be seduced by publicity or the chance to embarrass ministers. Someone who wished Cameron ill had a wicked sense of humour, and chose Leveson.
Judicial public tribunals are relatively new in the British constitution. In the old days parliament ruled supreme, holding government and its agents to direct account: Warren Hastings was impeached by parliament; a parliamentary inquiry into the Crimean war forced the resignation of Aberdeen as prime minister. When judge-led tribunals were introduced in 1921 then reviewed in 2005, a select committee concluded portentously that they “be confined to matters of vital public importance concerning which there is something of a nation-wide crisis of confidence”. They should not get involved in “kicking an issue into the long grass, blaming predecessors in government, making a gesture or simply buckling to public pressure to do something”. The Blair government at the time agreed that “the primary purpose of an inquiry is to learn lessons, not apportion blame”.
Pull the other one. Setting up a judicial inquiry has become a weapon in
Sir Jeremy Heywood admits culture department’s errors with written warning to all departments over special advisers’ conduct
Sir Jeremy Heywood, the cabinet secretary, has acknowledged the Department for Culture had mishandled the News Corp bid for BSkyB by writing to every government department warning special advisers about their conduct whenever ministers are asked to make quasi-judicial decisions.
The text of the fresh advice was not released by the Cabinet Office. Jeremy Hunt, the culture secretary, let drop news of the letter near the end of his statement to MPs in the Commons.
He said: “We need to learn the lesson about the appearance of impartiality. That is why today the prime minister has asked the cabinet secretary to write to all departments to clarify the rigorous procedures that departments should have in place for handling all cases of a quasi-judicial nature and said that it is vital that, in dealing with these cases, all contacts by ministers, officials and special advisers are carefully controlled and properly recorded so that the independence, integrity and impartiality of the process are upheld and, just as important, seen to be upheld.”
It is understood that senior civil servants are furious at the behaviour of Hunt. They believe his advisers totally ignored his responsibility to act impartially during one of the most sensitive takeover bids in recent Whitehall history.
Jonathan Stephens, the permanent secretary at the culture department, is due to give evidence to the public accounts committee on Thursday on an unrelated matter, but may be cross-examined about whether a political adviser is the right person to nominate as a point of contact for a commercial company. It is reported that Stephens allowed the culture secretary to nominate Adam Smith, his adviser, as the point of contact with News Corp.
David Cameron has so far prevented Sir Alex Allen, the independent adviser on the ministerial code, from conducting an inquiry into whether Hunt himself breached the code. It is the prerogative of the prime minister to decide whether the independent adviser should conduct an inquiry.
The code states that ministers are responsible for the conduct of their special advisers and their office. Michael Gove, the education secretary, said it would be “too literalist” to expect ministers to know aspects of the conduct of their special advisers.
The public administration select committee recently criticised the government for not asking the then adviser Sir Philip Mawer to conduct an inquiry into the way in which Liam Fox, when he was defence secretary, ran what looked like an independent foreign policy.
Cameron is insisting that Hunt’s conduct should be examined only by Lord Justice Leveson, and it would be wrong to pre-empt the outcome of his inquiry. Leveson himself on Wednesday morning suggested he did not want a slew of new inquiries into Hunt’s conduct, but also said he was not seeking to circumscribe parliament.
It is also expected that the former cabinet secretary Lord O’Donnell will give evidence to the Leveson inquiry. O’Donnell gave clearance for the culture secretary to oversee the takeover bid and is likely to be asked whether he feels he was misled by Hunt over the extent to which he was in contact with News Corp executives before he became responsible for the bid.
Hunt also suggested as a long-term solution to the crisis, in regards to future potential media takeovers politicians should no longer be responsible for decisions, but instead the issues should be handled solely by media regulators.