A SENIOR Tory MP who heads a Commons committee to alleviate poverty in the Third World has been accused of attempting to use his position to make up to £1.5m for his own company.
Tony Baldry, a former foreign minister, has been paid by a diamond firm to lobby the government of a west African country to secure valuable diamond concessions.
Baldry, chairman of the Commons international development committee, has close links with Sierra Leone, a war-ravaged country heavily dependent on British aid. He has visited the country twice in the past year on behalf of Milestone Trading, a UK-registered company owned by two Israeli businessman.
He has also written to Hilary Benn, the international development minister, asking for officials to give the company a "best practice" seal of approval.
His reward for the work on Milestone's behalf was a $75,000 (£40,000) payment into Red Eagle Resources plc, a company of which he is non-executive chairman and a one-third shareholder. Baldry has in addition struck a deal for his firm to take a 3% share in Milestone when it is floated later this year. Milestone estimates that this could be worth £1.5m.
The letter to Benn was written on Commons notepaper. It disclosed that Baldry planned to become chairman of Milestone, but did not reveal the shareholding his company had negotiated.
Yesterday George Foulkes, the Labour MP who is a former international development minister, said he would be reporting Baldry's activities to Sir Philip Mawer, the parliamentary commissioner for standards.
"This commercial activity is incompatible with his role as committee chairman, particularly now that select committee chairmen are paid," he said. "They should be scrupulous that they are not using their position for financial gain."
Foulkes believes that Baldry may have breached rules governing parliamentary advocacy on behalf of commercial clients by writing to Benn on Commons notepaper and failing to disclose his firm's financial stake.
Under Commons rules, MPs must declare not only paid directorships and overseas trips, but also any parliamentary advocacy on behalf of commercial clients. New rules for committee chairmen, after last year's decision to award them additional salaries of £12,750 for their roles, stated they could continue to have "outside interests, subject to full declaration."
Baldry's select committee is responsible for scrutinising the millions in government aid spent in countries such as Sierra Leone. A critical report by the committee can have an impact on whether such aid continues.
John Barrett, a Liberal Democrat member of the committee, said: "You are compromised if you are questioning [the secretary of state] as a member of the select committee but at the same time lobbying him for business reasons."
Baldry, a barrister, has been MP for Banbury, Oxfordshire, since 1983. A foreign minister in John Major's government, he now has extensive commercial interests and has been criticised in the past for his sporadic attendance in the Commons.
In March 2000, he was censured by the parliamentary commissioner for standards for failing to declare the receipt of a £5,000 personal loan from a solicitor shortly before he recommended him for an honour.
Baldry has long-standing personal links with Sierra Leone. He is a former colleague of President Ahmad Kabbah, who once practised in the same London chambers, and remains head of the chambers that acts for the Sierra Leone government in Britain.
According to Nissam Levy, the Israeli joint owner of Milestone, Baldry was hired on the advice of senior figures in the Sierra Leone regime who described him as the west African state's best friend in Britain. He came recommended by Sierra Leone's minister for mines, its vice-president and other cabinet ministers, according to Levy.
His initial role was to help Milestone smooth over allegations of links to the mafia. Levy's partner in Milestone, Gershon Ben-Tovim, had been a shareholder in a Namibian ostrich farm with Vito Pallazollo, who was wanted in Italy on mafia-related charges.
Levy said: "We came across, many times, this Tony Baldry, as a good friend who knew from the old days in chambers the president and vice-president and he is very well-respected. It was natural for us to contact him and ask for his services.
"We wanted him to do some politics, PR, like that. It's always good in any country that you have very good contacts. He knows them very well."
Baldry made two week-long trips to Sierra Leone in November last year and this January, arranging meetings between Levy and Kabbah and other ministers.
His letter to Benn was to seek the government's seal of approval for the company. Baldry asked Benn if British officials in Sierra Leone would meet Milestone representatives and ensure the company is "fully 100% in accord . . . with whatever 'best practice' [the department] would hope that mining companies in Sierra Leone would pursue".
Diamonds were an "emotive commodity", he said, but Milestone would be "a significant UK investor and to that extent not only Milestone's reputation but that of UK plc will rest on how Milestone performs".
Although he declared his plans to become Milestone's chairman when it is floated this year, he did not reveal his company's lucrative share deal.
Benn replied on February 14 saying the government could not "endorse an individual company's activities".
Baldry's approach set "alarm bells ringing" among Foreign Office officials who were asked to look into the company's affairs in Sierra Leone. They discovered allegations of human rights abuses at its two alluvial diamond mines in Sandoh and Nimikoro provinces.
Despite Baldry claiming local communities were "very happy with Milestone", leaders of the United Mineworkers Union in Sierra Leone complained workers were paid only Ï1 per day and denied adequate water and accommodation.
Further allegations surfaced that local policemen were hired as security guards and used to intimidate workers who went on strike over "inhuman" conditions.
Ezekiel Dyke, the mining union's leader, said: "The management are grabbing the diamonds without doing any thing concrete to create better conditions or assist in developing the area."
Baldry said he was under no obligation to declare his deal or payments to his company from Milestone in the MPs' register of interests. He said his work would benefit both Britain and Sierra Leone through jobs, investment and pledges to build a road, a school and a diagnostic clinic.
He rejected suggestions that his commercial interest in the company and his lobbying of British or Sierra Leone ministers had compromised his role as chairman of the select committee.
