As skin diseases go, athlete’s foot is almost ineradicable. This does not make it the less important to keep the fungus at bay. The same can be said of corruption in the arms industry. It may not be beaten but we should never entirely surrender to it. Somewhere between anger and fatalism an uneasy accommodation must be made. Whether Tony Blair’s Government has struck that balance well seems to me to depend heavily on what happened in the years 2001 and 2002, when new Labour’s anticorruption legislation was drafted and came into force.

Anger alone about the latest allegations of high-level corruption in arms sales to Saudi Arabia is pointless. Cynicism alone is pernicious. No one individual, or handful of individuals, can be blamed for these ills. This Government did not invent corruption in the arms trade worldwide. It found it when it came to office. It is at least as important to ask why as to discover what has happened in this particular case.

Selling devices to kill and maim people is unlike selling washing machines. The supplier is embarrassed about what is being supplied. The purchaser is sensitive about what is being bought. Customers include most of the world’s nastier governments. Purchases may be for some of the world’s nastiest purposes. Always on hand are ready-made arguments for secrecy, almost impossible to rebut. “National interest”, defined as sloppily as you please, can usually be prayed in aid. The remark that if we don’t do it then somebody else (usually the French) will remains infuriatingly true.

All the same, the latest story reeks of impropriety. I am not going to wade into the ins and outs of the allegations now in the news about the al-Yamamah deal, BAE Systems, alleged backhanders and alleged British government connivance. This is a field, in the first instance, for spooks and specialists, industry insiders and undisclosed sources. But as an outsider let me remind readers that for the past ten years a reliable indicator of a rotten deed has often been a sudden and unannounced shift in Mr Blair’s reasoning. Remember Iraq? It wasn’t about regime change, he said. And then it was, he said.

Last time I heard the Prime Minister talking about the al-Yamamah deal and the suspension of the Serious Fraud Office inquiry, I am sure his argument was about national security and damage to intelligence cooperation. Today I pick up the papers to discover Mr Blair talking instead about the loss “of thousands and thousands of jobs”. Presumably his intelligence stuff was made up and cannot be substantiated, and he has reached his argument of last resort. “Like a rotten mackerel in the moonlight,” as one US congressman once said of another, “he shines and stinks.”

Anyway Mr Blair will be gone soon. And anyway he was unlikely to be the author of this unsavoury mess. He inherited a world in which we all knew – I certainly did as a Tory backbencher – that the arms trade operated in a moral twilight. For what it’s worth, my sense of the rules – so far as there were rules – was as follows. I don’t recommend it: I simply describe it as it appeared to me.

If concealed backhanders or kickbacks were demanded from British companies by individuals in foreign governments or businesses, it was for the company concerned, and its staff, to take the decision whether to play along; and different companies (and individuals within them) would have made (and been free to make) different moral judgments.

If ministers were dealing with these companies and knew this was happening, they should take care not to involve themselves, and so far as possible turn a blind eye. If the company was in receipt of public subsidy, then ministers were in tricky borderline territory. If the suggestion could easily be made that public money was being paid into accounts used for backhanders, then this was probably the wrong side of the border. Taxpayer-funded export credit guarantees were a particular problem here. If ministers or their civil servants themselves did anything to expedite bribes, they were well out of order.

If what the domestic press might consider a kickback but others might call a consultancy fee was involved, then it was important this was declared and on the books.

Such may be thought a fair stab at the rules of engagement, prenew Labour. But the 2002 legislation, much trumpeted at the time, changed these rules importantly. The change was as much political as legal. The implicit promise was that ministers and civil servants were now on the warpath to stamp out corruption wherever they encountered it. HMG became proactive rather than reactive. From 2002 onwards the public became entitled to assume that any minister of the Crown, or civil servant, or law officer, who got wind of the improper payment of individuals abroad was duty-bound to investigate, step in and, if possible, stop the arrangement.

We may discover over the next few weeks whether that promise was breached in the al-Yamamah case, and whether that is the reason the Prime Minister was persuaded to stop the SFO inquiry. If it was, then the Government is in great difficulty.

There may be some parallels here with the cash-for-honours affair and the legislation on party financing in 2000. Both the 2000 and the 2002 Acts involve the striking of a note of high moral principle through the enactment of laws prohibiting a particular evil. But in both cases the particular evil was reflective of a deep-rooted and long-standing culture whose existence most privately acknowledged but few really wanted to tackle. The enactment of the legislation was not accompanied by any sustained determination to alter that culture. Soon, principle collided with practice. This serves politicians right.

But having enjoyed the Schadenfreude, how about trying to tackle the arms-trade culture? How have we got into this mess with Saudi Arabia? It is our desperation to find buyers for an unwanted fighter plane against which I have been inveighing on this page for nearly a decade: the Eurofighter (or “Typhoon” as it is now known, the British arms industry having, after the Tornado, concluded that one seven-letter disaster beginning with T was not enough).

The Government has become involved because it has poured so much taxpayers’ money into the doomed project. Why? Because of a policy, long-adopted by successive governments, of sustaining a strong domestic defence industry. This has been achieved through massive declared subsidy and the even greater undeclared subsidy of forcing our armed forces to buy uncompetitive products. The consequence has been an unnaturally close relationship between the Government and a single supplier, BAE, which has now anyway become heavily dependent on the Pentagon for its sales.

Thus (as any free-market Tory ought to have cautioned, but the Conservative Party never did) we have both wasted taxpayers’ money and ended up dependent on foreigners: dangerously dependent, in this case, on a single foreign power. We would have done better to have shopped around abroad more widely for our arms, in the first place.

Why are any former ministers, let alone former defence ministers, allowed to serve on the boards of the Ministry of Defence’s suppliers? Why are former civil servants allowed to advise or work for such companies? These are some of the questions that should be asked if we are to tackle the endemic culture of the arms trade – or our part in it – beyond the occasional newsworthy scandal.

If such a scandal has taken place, then by all means let us have the head of a minister or law officer on a stick. But be sure that in years to come there will be other scandals, other heads and other sticks. Believe it or not, I actually feel a trace of sympathy for ministers accused of doing Britain’s dirty work for us this week. It is not work ministers should be asked to do.

Get the sharpest political comment on at Comment Central

Times Recommends

• Care in old age: we won’t pay, the State can’t
• Viewers’ choice: our talentless Everyman
• Memo to the poor: go forth and don’t multiply