Back to warmwell.com website


http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2004/03/14/nbook14.xml&sSheet=/news/2004/03/14/ixhome.html&secureRefresh=true&_requestid=24515
 

Christopher Booker's Notebook
(Filed: 14/03/2004)

Billions vanished in this airport
Your lawyer is now an unpaid spy
Why did the warden cross the road?

Billions vanished in this airport

Martin Bell, the former MP and BBC journalist, made waves last week when he announced that would stand for the Eastern Euro-region in June's elections to the European Parliament. He claims that, as an "independent", he will get answers to questions more effectively than MEPs tied to political parties.

If Mr Bell thinks he has only to swan into Brussels and start asking questions, he might study the experience of a fellow Eastern region candidate, the Tory MEP Bashir Khanbhai who, with two other MEPs, Gabriele Stauner from Germany and Freddy Blak from Denmark, has been trying to help Basil Coronakis, the editor of a respected weekly paper in Athens, to get answers to some basic questions about the new airport at Spata, east of Athens.

This huge project, largely funded by EU grants and loans, opened three years ago at an alleged cost of 2.3 billion (1.6 billion), which makes it the third most expensive airport ever built.

The project was undertaken by Hochtief, a German company which specialises in airport construction. Although Hochtief only contributed 133 million to the project, it owns a 45 per cent share in the finished airport, and has a contract to run it through a subsidiary for 30 years, with the right to appoint its chief executive and five out of nine members of the board.

Of the claimed 2.3 billion cost, 250 million was contributed by EU taxpayers from the Cohesion Fund and 997 million was lent by the EU's European Investment Bank, backed by a Greek government guarantee. Much of the rest came from Greek taxpayers. But when Mr Coronakis, owner and editor of New Europe, began investigating the financing of the project, some very large question marks began to appear.

First, published figures for the cost of the airport's construction varied wildly, from Hochtief's original offer of 878 million in 1992 and the 973 million cited by the European Commission in 1996, to the 1.8 billion quoted by the Commission in April 2003 and 2.3 billion by Hochtief in the same month.

Why was the cost of Spata apparently more than double that of, for example, the new Malpensa airport serving Milan which, although of similar size, offered much better facilities and cost 945 million? Why was the 997 million EIB loan, approved by the Commission, larger than the total estimated cost of the airport when the loan was given, apparently in breach of the maximum 50 per cent infrastructure cost that the EIB was permitted to give?

The more Mr Coronakis investigated, now with the help of the three MEPs, the more puzzling the picture became. Why, in the published application for 250 million under the Cohesion Fund, was an interest payment of 415 million given separately from the construction cost in one section, then in a later table added into the construction cost but also shown separately a second time, so that this huge sum was included twice?

Why was the status of the airport company changed in a Commission Decision from a private corporation to a public authority, thus making it eligible for cohesion funding, even though this was in clear breach of Cohesion Fund rules and EC law? And why, in the Commission's published application document, was Section 10 followed immediately by Section 12, omitting the vital Section 11 which should describe where and to whom the payments would be made?

All this became odder still when Mr Coronakis discussed with all the sub-contractors how much they had actually been paid for their work on the project. His researches showed that the true construction cost must have been far less than any published estimate - perhaps as low as 320 million. If this were so, profits on construction alone would amount to nearly 2 billion, some 700 million of which should have been paid in tax. This makes it all the more vital to discover where and to whom payments of EU and state money had been made (as should be set out in the suppressed Section 11).

Mr Coronakis and the three MEPs have been trying since 2001 to get the European Commission to publish detailed accounts for this project. They have been engaged in correspondence with the Commission's regional funding directorate, with the EU Court of Auditors and with President Prodi himself, pressing for answers to all these questions, but in vain. In May 2003 Mr Prodi affirmed that they could not have any of the documents that they had asked for because "the contract contains economic and technical information and its disclosure would undermine the interests of the contractors".

In July last year Graham Meadows, on behalf of Commissioner Michel Barnier, promised that by October detailed accounts of the project would be available. They are still not forthcoming.

Last week, however, brought a new twist. A new Greek government was elected, under Costas Karamanlis, pledged to a full investigation of the Spata airport project. At last, Mr Coronakis, Mr Khanbhai and the other two MEPs may get the answers they have been seeking. Neither the European Commission nor President Prodi are likely to be much pleased, and the results may make headlines far beyond Greece.

Mr Bell, however, must realise that asking questions in Brussels is one thing - getting them answered is a different matter.

Your lawyer is now an unpaid spy

Last week I had a letter from my accountant to say that, like all other accountants, solicitors and bankers, she is now bound by the new Money Laundering Regulations 2003 and the Proceeds of Crime Act 2002. If she suspects that any of her clients are even considering an act of tax evasion (or any criminal offence, such as a breach of health and safety regulations), she must now report this to the National Criminal Intelligence Service or risk being sent to prison for up to five years. Furthermore, it becomes a criminal offence for any accountant, solicitor or banker to tip off their clients even that such a "suspicious transaction report" (STR) has been made.

This marks an astonishing breach in the code of confidentiality which governs the relationship of professional advisers and their clients. The professionals are being forced to act as (unpaid) government informers.

What most people caught up in this new legal minefield do not realise is that the Money Laundering Regulations went through parliament under the European Communities Act, to implement EC directive 2001/97.

It is the EC's legislation which now makes it impossible to open a bank account without particular proofs of identity often so hard to obtain that, as one victim wrote to The Times on Friday, if he is seen going into a bank waving a gun it will not be because he wants to steal money but simply because he wishes to open an account to deposit some.

Certainly it is a twilight world this is leading us all into, as can been seen from the National Criminal Intelligence Service's website relating to "suspicious transaction reports". On the face of it, if you give your solicitor money to put into a client account, he must hold the money back until he has secretly reported it to the NCIS and been given permission to pay it in. But if in the meantime you wish to know what has happened to your money, he will be committing a criminal offence if he tells you.

National? Perhaps. Criminal? Probably not. Intelligence? No sign of it. Service? You must be joking.

Why did the warden cross the road?

Last Sunday I reported the story of Mr and Mrs Rayner, an elderly and infirm couple living in a Cambridgeshire council bungalow, who were told they could not have "warden support" - regular visits from a professional carer - because of a ruling by John Prescott under his "Supporting People" policy. South Cambridgeshire council had provided warden services to a neighbour just across the road, but when he died, Mr and Mrs Rayner were told the warden could not call at their home instead. Mr Prescott had ruled that no new addresses could be added to the list, and they could have the service only if they moved house.

Although Mr and Mrs Rayner and their councillor Robin Page had been battling with the council for months over this absurd decision, I am pleased to report that last Tuesday they were told the warden would now be allowed to walk over the road to help them after all.