HL Deb 06 June 1996 vol 572 cc1353-4

Lord Peyton of Yeovil asked Her Majesty's Government:

Whether, following the judgment in the United States courts in the action brought by the Northern Ireland Office against Arthur Andersen, it is their intention to pursue the case further, and what have been the costs of the action to date.

The Parliamentary Under-Secretary of State, Northern Ireland Office (Baroness Denton of Wakefield)

My Lords, in the recent judgment in the United States courts in the matter of Her Majesty's Government v. Arthur Andersen, the judge ruled that the Government's claims against Arthur Andersen in respect of negligence, breach of contract, fraud and aiding and abetting fraud should be allowed to proceed. Preparations are being made for the trial. The amount of costs in the case are a matter between government and their lawyers and disclosure while the action continues would not he in the public interest.

Lord Peyton of Yeovil

My Lords, would my noble friend be good enough to confirm that the events with which this action is concerned took place 16 years ago and that the case has been hanging around in the neighbourhood of the American courts for at least 10 years? If the Government will not tell me—I am sure they will not want to—what the costs have been, may I please guess that so far £15 million would just about cover it and that if they persist in the case, which they are likely to lose, the figure will be more like £40 million? It seems to me to be one of the most expensive pieces of face saving and cosmetics in history.

Baroness Denton of Wakefield

My Lords, I am pleased to confirm to my noble friend that there is no question of face saving whatever. There is competent legal advice that there is the opportunity to recover taxpayers' funds and in that matter I think the timescale is irrelevant.

Lord Williams of Mostyn

My Lords, when one deals with the question of taxpayers' funds, is it not the position that if the Government are successful a sum in excess of 300 million dollars is likely to be recovered, bearing in mind pre-judgment interest? Does the Minister agree that if there is a prima facie case supported by a judge in a competent jurisdiction in respect of allegations of negligence, common law fraud, security law violations and breach of contract, the British Government have a public duty to pursue those allegations?

Baroness Denton of Wakefield

My Lords, I am not a lawyer. To have the advice and comments of such a distinguished lawyer is exceedingly helpful.

Lord Howe of Aberavon

My Lords, perhaps I may divert my noble friend with a slightly different flavour of loyal advice. Has she had the opportunity of studying the 50-page report of the Public Accounts Committee produced some 12 years ago which said that this enterprise was impracticable from the start and should never have been assisted and made not one reference to Arthur Andersen, the defendants in this case? Does she not agree that the judgment of the American courts to which she referred dismissed at least half the alleged grounds of Her Majesty's Government's claim, including all of those which would give rise to so-called RICO triple damages? Is it not time for a fresh mind to be brought to bear on the wisdom of this litigious excursion?

Baroness Denton of Wakefield

My Lords, I am pleased to reassure my noble and learned friend that I have examined this matter with fresh expert advice. I believe that the matter of the Public Accounts Committee is outside the range of this Question and I believe the advice to continue to be very sound.

Lord Blease

My Lords, the noble Baroness will probably know that I was part of the body involved in the early negotiations concerning this case. We were quick to acknowledge that many mistakes were made. There is a past still to be pursued in collecting what was due because of corruption and other matters. The trade union movement and employers in Northern Ireland fully backed any methods used to redress the situation. The matter had a dampening effect on many aspects of life in Northern Ireland at that time. However, I am glad to say that many lessons have been learnt. Today, there is much American investment which is wholeheartedly supported and welcomed.

Baroness Denton of Wakefield

My Lords, I am grateful to the noble Lord for his comments. It is important that we learn from issues in the past. We continue to attract inward investment to Northern Ireland, because the best cement for peace is jobs.

Lord Peyton of Yeovil

My Lords, I would quite understand if, in present circumstances in Northern Ireland, Ministers there had not been following this matter with the closest concentration. They have other matters on their hands. I hope very much they will now take a serious look at what has been happening.

Baroness Denton of Wakefield

My Lords, I must question my noble friend's assumption that a Question of his would not be taken seriously or considered in depth. I assure him that I am not only representing Northern Ireland. I cast a Yorkshire eye over the issue.

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