The money eaten in this scandal could have used to improve Tanzania's School, Hospitals and Water Supply! SAD!
BAE: The Tanzanian connection
Europe's biggest defence company, manufactures the Typhoon fighter By Andrew Hosken The Serious Fraud Office (SFO) says it will begin what promises to be the biggest corporate corruption prosecution in British legal history.
It is asking the Attorney General for the go-ahead to prosecute BAE for bribery under the 2001 Prevention of Corruption (Amendment) Act.
One of the four countries involved in the alleged corrupt deals is Tanzania. Though far from the largest deal, it looks certain to cause the biggest heartache in Downing Street.
In 2001, Tanzania, one of the world's poorest countries, decided to purchase a military air traffic control system from BAE.
Clare Short, then secretary of state for international development, says she was horrified by the move and was convinced it was a corrupt deal. "I was really shocked by the behaviour of British Aerospace and the collusion of all these government departments in such a gross and disgraceful project," she told me.
"Even when I got all the information and took it to the highest levels of the government, I still couldn't stop it."
'Grubby'Ms Short says that a number of factors convinced her that this was a corrupt deal. She says that the deal had been proposed 10 years earlier but had been blocked by intervention by the World Bank and the UK's Overseas Development Administration, the precursor to the Department for International Development.
"Then it came back as half a project. The thing was so grubby from beginning to end and, of course, it was so old that the technology was overtaken. Tanzania didn't have military aircraft. It needed civil air traffic control improvement in order to improve its tourist industry."
But Clare Short was far from alone in expressing deep concern about the BAE-Tanzania deal. In October 2001, a report by the International Civil Aviation Organisation, a part of the United Nations, said:
"The system as contracted is primarily a military system and can provide limited support to civil air traffic control purposes. The purchase of additional equipment… would be required to render it useful for civil air traffic control.
However, if it is to be used primarily for civil air traffic control purposes, the proposed system is not adequate and too expensive."
Clare Short says tha Tanzanian deal was "a disgraceful project" At the same time in 2001, Clare Short had agreed a £35m aid package for Tanzania to help provide more children with education but saw virtually the whole sum being effectively gobbled up in the air traffic control system deal.
She opposed the deal in cabinet, a row which soon became public, but claims that in December 2001 one person above all insisted the necessary export licence be given: Tony Blair. "Tony was absolutely dedicated to all arms sales proposals," she says.
"Whenever British Aerospace wanted anything, he supported them 100%. He didn't seem to understand that there are matters of principle concerned. He had also been duped and bought the argument that it's always good for the British economy, which is absolutely not so."
In 2006 Tony Blair made one of the most controversial decisions of his premiership, helping to force the closure of an inquiry by the Serious Fraud Office into allegations that British Aerospace had paid bribes to win a lucrative arms contract with Saudi Arabia.
"I stick by that," he said six months later, "and the idea frankly that such an investigation could be conducted without doing damage to our relationship is cloud cuckoo land."