Home > Britain, Corruption, India, Social Trends > Cash for Honours: 100 Years of British Corruption

Cash for Honours: 100 Years of British Corruption

A look at corruption in ‘mother of democracy’ – Britain. The problem is not the British people or British leaders – but the Desert Bloc system of governance.

Tony Blair was one in the long-line of British Prime Ministers who sold peerages for money.  |  A 2006 cartoon by Andy Davey;  source & courtesy - andydavey.com  |  Click for image.

Tony Blair was one in the long-line of British Prime Ministers who sold peerages for money. | A 2006 cartoon by Andy Davey; source & courtesy - andydavey.com | Click for image.

We are the most corrupt

Most Indians assume that!

A few years ago, at a book-promotion event in Kolkatta,

A Britisher in the audience offered that Indians were more honest about being corrupt, naming Mayawati as a favourite, provoking titters all around. (via The Telegraph – Kolkata| Metro | When corruption is a daily habit)

The Britisher may be more right than most Indians.

The British Chapter

In an earlier post, we had examined corruption – American style.

The British Prime Minister during WWI, Lloyd George was involved in numerous scams – the most famous being the Marconi Scam. Just before WWII, the British Prime Minister Neville Chamberlain, was involved in another scam, for his role in the BSA motorbike company.

Between WWI and WWII, many questions were raised in the British Parliament – and outside about Neville Chamberlain’s holdings in ICI, shares estimated at 11,000. His son, Francis Chamberlain, had joined the Kynoch Works an old firm with which the Chamberlain family was associated. As also with BSA Company (Birmingham Small Arms) in which he was a director.

And then, there is evergreen, ‘cash-for-honours’ milch-cow. Nearly every Prime Minister has made money by granting titles and Lordships.

Journalists from Murdoch's newspapers paid British policemen for news.  |  Cartoon by Dave Brown from The Independent; source & courtesy -  jeffreyhill.typepad.com  |  Click for image.

Journalists from Murdoch's newspapers paid British policemen for news. | Cartoon by Dave Brown from The Independent; source & courtesy - jeffreyhill.typepad.com | Click for image.

Since a scandal over the honours system might well bring down Tony Blair as Prime Minister, it might be useful to place his record in the area of creating new titles in a wider historical context. Every Prime Minister creates new peerages and knighthoods. Many perforce have gone to wealthy men, and, with virtually every Prime Minister, there has been at least an implication that superlative merit alone was insufficient to explain their elevation. A number of studies of the creation of peerages and life peerages by scholars, including this author, can cast some useful light on how modern Prime Ministers have treated the honours system.

David Lloyd George was, of course, notorious for his peerage creations. How justified is this lasting reputation? In his five and a half years as Prime Minister, Lloyd George created ninety-one new peers, an average of sixteen per year. This was indeed a high total, much higher than the annual average of six new peers created by Lord Salisbury or the eleven created by H. H. Asquith. Nevertheless, there were many extenuating circumstances.

The Parliament which was in place during the First World War was dissolved in November 1918 after having gone eight years without a general election, its life extended by the necessity to avoid an election in the middle of a brutal war. Lloyd George was thus faced by an unusual number of retirements among senior MPs.

Lloyd George also had to honour the senior military commanders of the War. Sir Douglas Haig received an earldom, the official Thanks of Parliament, and a tax-free grant of £100,000, around £6 million in today’s money. Other senior generals and admirals also received peerages, and several others also received substantial tax-free grants for winning the War. It is unnecessary to add that the actual soldiers and sailors received nothing.

However, Haig’s monetary reward demonstrated an historical downward decline: Wellington received £500,000, as well as a dukedom, for defeating Napoleon. Although the leading British military commanders of the Second World War would be regarded by most historians as far better, as military leaders, than those of the Great War, Montgomery et al. received only peerages, not money, which the post-war Labour government had no means or desire to hand out.

The aftermath of the First World War was, in fact, the last time in British history that newly-created peers received money along with their titles. Many would question whether it would not have been more appropriate for the senior commanders of the Great War to have received the short end of a noose rather than a seat in the Upper House, but Lloyd George was obliged to honour them, and none of his critics – certainly none in the Tory party – criticised these titles.

Lloyd George also gave peerages to Empire figures and also to a good many wartime or postwar Ministers in order to bring them into the government, or use them soon after their elevation. For instance, the Canadian Sir Max Aitken became Lord Beaverbrook in 1917 and was given a Cabinet post in February 1918.

Few of these creations caused a public scandal. What we know as the “Lloyd George Honours Scandal” chiefly concerned his very last group of peers in 1922, a list which included William Vestey, the millionaire shipowner and frozen meat king who had emigrated to Argentina to avoid paying taxes, and then returned to England after creating an elaborate international network, with dummy holding companies in France and elsewhere, that guaranteed a virtual tax free income, and Sir Joseph Robinson, a mega-wealthy South African gold magnate so notorious that he was forced to “return” his peerage shortly after it was announced.

Right-wing Tories, looking for an excuse to end the Lloyd George Coalition government, seized on these Honours scandals to undermine the Prime Minister, and the mud has stuck ever since.

Via Maundy Gregory, the honours “bagman”, Lloyd George certainly sold titles – Cardiff became known as the “city of dreadful knights” – although this was nothing new, and it was Lloyd George’s openness, rather than the novelty of this arrangement, which led to scandal. Some peerage-purchasers proved rather clever at what they were doing. Sir James Buchanan, a multimillionaire Scottish whisky distiller, wanted to become Lord Woolavington in the 1922 New Years Honours List, so he signed his cheque “Woolavington”, and dated it “2 January 1922” – no peerage, and the cheque would bounce. He indeed became Lord Woolavington.

Peerage creations continued at roughly the same rate: Winston Churchill created an annual average of eleven per year in his wartime administration of 1940-45, while Clement Attlee created nine per year – until the passage of the Life Peerage Act of 1958, which opened the floodgates. Many pro-Labour figures, or poor men (and, from 1958, women) for whom an hereditary title would be ridiculous, were more than happy to accept a title which ceased with their own demise.

In his 1964-70 government Harold Wilson created no fewer than 154 life peerages (and six hereditaries, all nominated by Sir Alec Douglas-Home at the end of his term). Nothing daunted, Wilson created another 84 life peerages in the two years of this second term in Downing Street from 1974-76. This made an all-up total for Wilson of 234 life peerages, compared with just thirty-four created by Edward Heath from 1970-74. To be sure, Wilson had to create many Labour peers to have a respectable total in the Tory-dominated Lords, but Wilson famously handed out titles like their was no tomorrow, awarding life peerages to his secretary, his solicitor, his doctor, his favourite raincoat manufacturer, and many others in his personal entourage.

Since then, there has been a steady and vast escalation in the number of life peer creations: sixty by James Callaghan; 204 (plus four new hereditaries) by Margaret Thatcher; 172 by John Major. Tony Blair has, however, outdone them all, creating 153 life peers between his election in May 1997 and the end of 1999, plus around 200-250 more since then (and one new hereditary, the Earl of Wessex). (via The Social Affairs Unit – Web Review: Cash for Honours: William D. Rubinstein offers an historical perspective).

The solution to corruption!

How classical Indian rulers, using भारत-तंत्र Bharat-tantra managed thin governments – without loot, slavery, palaces, bureaucracy, welfare state delivered results.

  1. March 30, 2012 at 1:35 pm

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