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Tuesday, 19 February, 2002, 11:32 GMT
Steel boss blasts 'naive' Blair
Lakshmi Mittal and Tony Blair
Lakshmi Mittal had a letter of support from Tony Blair
The boss of a British steel company has called on Tony Blair to apologise for helping Indian tycoon and Labour donor Lakshmi Mittal land a lucrative contract in Eastern Europe.

Graham Mackenzie, chief executive of Cardiff-based Allied Wire and Steel, told BBC Radio 4's Today programme that, at best, Mr Blair had been guilty of "naivety" for not doing his homework on Mr Mittal's companies.

"At worst it was a deliberate slight on the UK steel sector," he added.

Opposition parties are demanding an inquiry into Labour's links with Mr Mittal after Mr Blair wrote a letter in support of his company LNM, which was bidding to buy Romania's state steel industry.

Downing Street has claimed Mr Blair did nothing wrong and was simply supporting a British company - even though LNM employs less than 0.1% of its workforce in the UK and is registered in the Dutch Antilles.

Questions have also been raised about Mr Mittal's funding for a campaign in the US to limit steel imports - a move which could cost hundreds of British jobs.

'Specific action'

"At the very least I would have thought he (Mr Blair) owes us an apology," Mr Mackenzie told Today.

"And then he needs to follow that up with some very specific action by the government to revitalise UK manufacturing and to give some specific help to the hard-pressed steel sector."

Mr Mackenzie said his company had been hit by the growth of steel imports from Eastern Europe.

He said a surge of imports from Romania would further damage British steel producers.

While the imposition of tariffs by the US government could also cost British jobs.

'Slip-up'

Labour peer Lord Paul, chairman of the Caparo Group, a private company which specialises in steel and engineering products, described the Mittal affair as "unfortunate" and a "slip-up".

"There is no doubt that perhaps the Prime Minister had been feeling that this was a British company ... but it just turned out to be it wasn't a British company," the peer told Today.

Lord Paul said steel jobs in this country were at risk from imports and an effort had to be made to save them.

Watchdog call

Meanwhile, a senior Labour MP has said government ministers should have their own watchdog to prevent continuing allegations of sleaze.


If people have allegations to make, they should be able to submit their evidence to a public standards commissioner who would decide if there was the basis for an investigation

Tony Wright, Senior Labour MP
Tony Wright, chairman of the Commons public administration committee says the government's critics often want complaints to "hang in the air" rather than to be investigated properly.

The parliamentary standards commissioner already regulates MPs' behaviour but Dr Wright says there should be a similar mechanism for complaints against ministers.

Dr Wright believes controversies such as the Mittal affair are undermining confidence in politics and is renewing the call made by his committee last year.

Currently, only the prime minister can order an inquiry into such claims against ministers.

Dr Wright said: "If people have allegations to make, they should be able to submit their evidence to a public standards commissioner who would decide if there was the basis for an investigation...

"I suspect that some people would prefer to have allegations hanging in the air rather than properly examined, but this is now doing enormous damage to confidence in the political system."

The prime minister's official spokesman attempted on Monday to draw a line under the Mittal row.

'Claims disproven'

The original allegations - that Mr Blair had intervened to help Mr Mittal because he had donated 125,000 to Labour funds three weeks earlier - had been thoroughly disproven, the spokesman said.

He said he was not going to get into an academic discussion about how companies like LNM operated in the global market place.

 WATCH/LISTEN
 ON THIS STORY
The BBC's Nick Robinson
"The government is perceived as having form"
Tory leader, Iain Duncan Smith
"These are very serious concerns"
The BBC's Mark Mardell
"Behind the bravado, number ten is pretty embarrassed"
 VOTE RESULTS
Labour donor row: Should there be an inquiry?

Yes
 78.26% 

No
 21.74% 

5001 Votes Cast

Results are indicative and may not reflect public opinion


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Background

TALKING POINT
See also:

18 Feb 02 | UK Politics
Blair silent on Mittal's US links
17 Feb 02 | UK Politics
Labour tops sleaze poll
17 Feb 02 | UK Politics
Sleaze watchdog 'nobody's patsy'
17 Feb 02 | UK Politics
Bank behind the loan
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