MR. THOMAS BLAMED

Hawke's Bay Tribune, Volume XXVI, Issue 144, 3 June 1936, Page 7

MR. THOMAS BLAMED

UNAUTHORISED DISCLOSURE

Budget Leakage Tribunal Issues Its Report LESLIE THOMAS EXONERATED (By Telegraph—Per Press Association—Copyright) (Received 3, 9.30 a.m.) LONDON, June 2. The Budget Leakage Tribunal found that there was unauthorised disclosure by the Rt. Hon, J. H. Thomas to Sir Alfred Butt of information relating to th# Budget for the present year, and that use was made of it by Sir Alfred Butt for the purpose of private gain. There was no leakage from civil servants or printers. The same observations apply to all the members of Cabinet, save Mr. Thomas.

The tribunal found that there was unauthorised disclosure of information by Mr. Thomas to Mr. Alfred Bates, who used same for the purpose of private gain. The tribunal does not see the connection between Mr. Bates’s payment of £15,300 in respect to Mr. Thomas’s autobiography and the suggested leakage, except that it accentuates their close connection and friendship and puts Mr. Thomas under an obligation to Mr, Bates. The tribunal is unanimously of the opinion that Mr. Leslie Thomas neither knew nor suspected that Mr. Bates had improper information concerning Budget secrets. The tribunal criticises Mr. Eves’s prevarication and lack of candour in his desire to protect Mr. Bates from the result of the disclosure of the truth. Mr. Bates was also guilty of misstating and suppressing the truth for the same reason. Referring to Sir Alfred Butt, the report says that the tribunal does not believe the explanation that the successful insurance against risks of income-tax and tea-duty was fortuitous.

long queue lined the pavement at the Stationery Office awaiting the issue of the Budget report, and eagerly bought copies. MR. THOMAS STAGGERED. Mr. Thomas, seemingly staggered by tho report, said: "It is a cruel verdict. Thank God Leslie is exonerated,” Mr Alfred Bates said, "I have nothing to say.” Sir Alfred Butt’s secretary said that Sir Allred was nut making ail intimation to the Press.

Mr. Thomas, in an interview, said, "1 repeat what 1 previously stated on oath to tho tribunal, that 1 made no disclosure of Budget secrets to anybody. My conscience is clear. 1 would like to make it clear that immediately I heard of my son’s and my name mentioned 1 demanded an inquiry. Secondly, 1 never, while a member of Cabinet, knew tho lonni the inquiry would take or the composition of the tribunal, but immediately it was publicly announced 1 wrote and offered to give all the assistance I could. 1 appeared twice before the tribunal—on the second occasion to state that I had never seen or heard tne people who giuve evidence associating my name with '.heir transactions. "A TERRIBLE BLOW.” / "It is well known that every private transaction of mine was investigated by the tribunal. Immediately tho tribunal ended its public sittings I tendered my resignation because, as I explained in my letter tc the Prime Minister, I was and am. jealous to preserve the high standard of public morality maintained by all parties in the State. It would be idle to deny resigning from a body ol colleagues with whom 1 worked in complete accord for so many years. In such circumstances it was a terrible blow.

‘‘Nobody will ever know the indignities I aud my family have suffered, but oue has some consolation in the thousands of letters from all classes, which have given me help and encouragement, and above all, the true comradeship of a loving wife and family lias enabled me to bear up under such strain. ‘‘l intend to take an early opportunity to address my constituents who, for so many years, have given me their eonfidqpce.” When interviewed, Mr. Thomas was obviously suffering from severe shock, lie read slowly and deliberately a statement which had been prepared iu consultation with his solicitors.

In the meantime crowds gathered outside Mr. Thomas's house, but were controlled by the police. It is regarded as probable that Mr, Thomas will vacate his House of Commons seat and light a by-election for Derby. The Committee of the National Gov. eminent Association will meet within a few days to consider the report and its bearing on Sir. Thomas’s future. FACTS AGAINST SIR ALFRED. The tribunal sets out the salient facts regarding Sir Alfred Butt. FirstIv. tho readiness on his part, alter careful examination of the financial po. sition during the Easter vacation, to

write insurances on April 20 and 21 against an increase in income tax; secondly, the withdrawal of those insurances, not because he had changed his view in regard to the likelihood of an increase, but because ho thought that tho terms offered were less than tho state of tho market warranted; thirdly, the sale by Sir Alfred on the morning of April 21, before tho visit of Mr. Thomas, of such securities us ho then thought desirable to sell. Next there is mentioned the visit to Mr. Thomas at Whitehall; next, the invitation to Mr Thomas's sou and his broker to lunch; then, for the first time mention of the Budget to tho broker and instructions for the gale of more securities.

Then camo the giving ot instructions for insurance against an increase in income tax and the tea duty at a premitted rate as high as 30 guineas per cent., a rate not exceeded in the average, but reaching 40 guineas in the insurance last effected. The next point was effecting insurances m the name of a nominee or nominees, a practice not heretofore adopted by Sir Al lieu BERRYS EXONERATED. 'I lie report states that there is no shadow’ of truth in the suggestion that any member of the Berry family (Lord Camrose, his brother or others of tho family) did any insurance on Budget risks.

Mr. Bates alleged that he made sales of gilt-edgeds and fixed-interest-bearing stocks amount to £73,(XX) because he feared an increase in income tax. Tho tribunal secs no reason to suppose that he had any such object, and believes that the sole object was rearrangement of his investments to avoid as much us possible of the taxation already imposed or to be imposed. But in all previous years he had done contingency insurances in his own name. "We done appreciate his'explanation for the change (in asking Mr. Davis to place risks for him in Mr. Davis’s name).” “Sir Alfred Butt stated that one ol the reasons which led him to believe that there would be an increase in taxation was an article published in the ‘Economist,’ ” the report continues. "That statement contrasts with the earlier evidence that alter studying the question the previous week he came to the conclusion that there would not be additional taxation. How the placing of the risk arranged at the interview between Sir Al.red, Messrs. Kenneth Butt mid Davis would be distributed between Messrs. Davis and Kenneth Butt is not explained, and as far as insurance against tea duty is concerned, three witnesses differed altogether. It is clear that as much insurance against income tax and tea duty increases as possible was placed on behalf of Sir Alfred after that meeting. During the afternoon Messrs.

Davis and Kenneth placed total insurances of £6950 against an income tax increase x.id £ll5O against a tea increase. All were successful. It is fair to Mr. Davis to say that there is no ground for suggesting that he was aware that use was being made of an unauthorised disclosure of Budget secrets ” MR THOMAS'S MOVEMENTS. The tribunal recalls that Cabinet me 1 on April 9 with Mr Thomas present | when the Chancellor disclosed the Bud get proposals, and how Mr Thomas that day or next travelled to Fcrring, where he remained until fhe end of the Easter holidays; also how the Bates s home was at Worthing, nearby. Messr.’ Bates and Thomas were frequently to gether and Mr Leslie Thomas was also visited. Mr Bates w-ent to London on April .14 and immediately commumcat ed with his brokers, Messrs Busby, re speeting insurance against tin incotn. tax increase. He also arranged an afternoon appointment tho same day | with Mr Leslie Thomas, a partner of ; Messrs Belisha, who were also stock I lookers for Mr Bates, who then InI structed him to sell £50,000 worth el securities, which were gilt-edgeds, and

therefore most likely to bo affected by a rise in income tax. The report relates that Mr Bates was taking up insurances against increases in the names of his son and secretary, explaining as the reason tor such action that he was going away and it was con venient to use their names so that they could give cheques when required. Mr Bates insured against an increase of income tax between April 14 and 20. Sir Alfred Butt, unlike Air Bates, had in tho past insured heavily against Budget risks. The report mentions without comment Mr Thomas’s election insurance in 1935 resulting in a profit of £. .32.