Firm 'allowed to build Iraq missile base': Ministers approved Exocet project despite objections from Foreign Office, inquiry told

SENIOR MINISTERS permitted a company owned by the Ministry of Defence to help build an Iraqi weapons complex used to prepare Exocet missiles, the Scott inquiry heard yesterday.

International Military Services - an arms sales company wholly-owned by the government - constructed the complex and installed safety equipment despite initial objections from the Foreign Office and defence experts who believed it 'significantly enhanced' Iraq's military capability and fears over missile attacks on shipping in the Gulf.

Objections to the work were overruled after Norman Lamont, former minister for defence procurement, wrote to Tim Renton, former foreign office minister, assuring him the IMS work was not a 'real enhancement' of Iraq's war effort.

Mr Lamont said IMS were only supervising the construction of the complex and the equipment being installed was 'exclusively' for the 'physical safety of those who conducted the tests on the weapons'. He claimed French technicians were already testing and maintaining the missiles in temporary facilities in Iraq.

Foreign Office opposition to the deal ended after the letter, Mr Alan Collins, a Foreign Office official, told the inquiry. 'The letter came from the highest level of the MoD. It became increasingly difficult to maintain objections to the project,' he said. Tim Renton requested that the project proceed with 'minimal publicity'.

The Scott inquiry is investigating claims of government collusion by ministers and civil servants in defence exports to Iraq in breach of official guidelines and export laws. Mr Collins, who is now a senior British diplomat in the Philippines, was the former chairman of a government committee which vetted defence exports to Iran and Iraq.

He said the work was one of a 'whole raft' of IMS contracts in Iran and Iraq which concerned the Foreign Office. He said the Foreign Office was 'pretty unenthusiastic' about the IMS work and the Exocet project was one which they 'needed to keep an eye on'.

They sought 'assurances at the highest level' that the contracts did not breach government guidelines drawn up in November 1984 which stopped exports which 'significantly enhanced' Iraqi military capability, he said.

They were initially told the deal would enhance Iraq's war effort but because it had been struck in 1981, before the guidelines, it could still go ahead.

Mr Collins said they remained concerned and referred it to ministers which led to Mr Lamont's letter. Asked whether he was convinced by Mr Lamont's explanation he said he took it at 'face value'. He said the Foreign Office would have been very cautious about any similar export application.

The Scott inquiry has already heard that government military advisers wanted IMS to be rebuked for later attempting to get round the guidelines.