Tuesday, January 16, 2007

Overseas spy agency MI6 has challenged a statement by Tony Blair's government that a corruption inquiry into a huge defence contract with Saudi Arabia threatened national security, The Guardian said on Tuesday.

London dropped the investigation into deals involving Saudi officials and people working for BAE Systems last month.

At the time, Lord Goldsmith, the government's top lawyer, said Blair and security service chiefs believed prolonging it would "cause serious damage" to national security. But the Guardian, citing government sources, reported John Scarlett, the head of MI6, later refused to sign up to a government dossier saying his agency agreed with this assessment.

These sources were quoted as telling the paper that Goldsmith's statement to the House of Lords was incorrect.

MI6 and MI5, the domestic intelligence agency, had no information Saudi Arabia was planning to sever security ties, according to the Guardian. They had simply been asked whether national security would be hurt if such a breach happened, to which they replied that of course it would, it said.

A spokeswoman at Prime Minister Blair's office declined to comment on the report. The Foreign Office was unavailable for comment.

Officials are preparing to explain their reasons for dropping the inquiry to an anti-bribery committee at the Paris-based Organisation for Economic Cooperation and Development (OECD) on Tuesday, the Guardian said.

The dossier Scarlett refused to sign up to was part of the government's preparations for this meeting, according to the paper. It said the language had now been altered.

Some 130 campaign groups and charities have written to Blair in a bid to reopen the Serious Fraud Office inquiry.

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