Fox ‘fell short of standards required of a minister’

Cabinet Secretary Sir Gus O’Donnell yesterday released his ten-page report into Dr Fox’s dealings with his former flatmate and best man Adam Werritty, an ex-defence consultant, originally from St Andrews, who travelled around the world with him, claiming to be an adviser.

Sir Gus recommended five new rules governing the behaviour of ministers, which were last night accepted by Prime Minister David Cameron.

These include ministers giving details to their civil servants of private meetings where substantive issues are discussed, and for departmental permanent secretaries to ask the Prime Minister to intervene, if necessary, if a minister fails to heed their warnings over contacts with individuals or organisations.

In Dr Fox’s case, the report highlighted that concerns raised about Mr Werritty by civil servants had been ignored.

Sir Gus said there had been an “inappropriate and unacceptable” blurring of lines between official and personal relationships that risked creating the false impression that Mr Werritty spoke on behalf of the UK government.

Mr Werritty met Dr Fox 22 times in the Ministry of Defence’s Whitehall HQ and 18 times on trips abroad, and used business cards describing himself as an adviser to the then defence secretary.

The report disclosed that Dr Fox had turned down an offer to have an MoD official attend a meeting with the defence supplier Harvey Boulter in Dubai last June, something that Sir Gus described as “unwise and inappropriate”.

The meeting was at the heart of the allegations about the former minister being open to undue access.

Dr Fox also rejected an offer to take an official to a private dinner with senior Israelis in Tel Aviv in February – although, on that occasion, the British ambassador was present.

“This should not have been allowed to happen. Ministers should respect the advice they are given, particularly when there are security or propriety implications for the decisions they take,” the report said.

Sir Gus found that Dr Fox had been twice warned by his private office and MoD permanent secretary Ursula Brennan of the risks posed by his association with Mr Werritty.

Despite this, the former defence secretary “clearly made a judgment that his contact with Mr Werritty should continue”.

While this may have been a reasonable judgment had their contacts been “minimal and purely personal”, damage arose because the frequency, range and extent of their contacts were not regulated and because Dr Fox did not inform his department of them.

While Sir Gus could not find any evidence to conflict with Dr Fox’s claim that national security had not been compromised, he did say that by giving Mr Werritty access to his diary and allowing him on 18 out of 48 foreign trips, the minister had compromised his own personal security and that of staff.

But the report cleared Dr Fox of making any financial gain from the relationship or of breaching national security.

Dr Fox, formerly the most senior Scot in the government, said he was pleased “the two most serious allegations, namely of any financial gain sought, expected or received by myself and any breach of national security, have no basis”.

But he added: “I accept that it was a mistake to allow the distinctions between government and private roles to become blurred, and I must take my share of the responsibility for this.”

The report failed to address issues surrounding the six donors who put money into Pargav, the company that funded Mr Werritty’s lifestyle around the world with Dr Fox and apparently arranged meetings between the minister and others.

The report said Mr Werritty had another company, Todiha Ltd, that invoiced Pargav for Mr Werritty’s services. Donors included millionaire Michael Lewis and his company Oceana Investments, corporate intelligence firm G3 Ltd, investment company Tamares, venture capitalist Jon Moulton and a business called IRG Ltd.

Sir Gus did not look into Atlantic Bridge, the right-wing think tank set up by Dr Fox that employed Mr Werritty but was effectively closed down by the Charity Commission.

The former defence secretary may face continued investigations from the Electoral Commission and the Parliamentary Standards Commissioner, while Mr Werritty is facing a possible investigation by the City of London Police.

Labour branded the report “superficial and narrow”, saying it only “scratched on the surface of potential wrongdoing”.

Shadow defence secretary Jim Murphy said: “We need to know the role and influence of Liam Fox’s ‘unofficial adviser’, the nature of any solicited donations and the full extent of Adam Werritty’s funding and the access he had.

“The Prime Minister must give the British public a categoric statement that he is certain that no similar practices are taking place anywhere else in his government, and must confirm that he did not know any of the facts that have come to light since Dr Fox’s statement on 10 October.”

A statement on the report is expected to be given in the Commons by Leader of the House Sir George Young today.