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February 26, 2007

Cash for Honours: William D. Rubinstein offers an historical perspective - and argues that the real problem with Blair's peerages has not been the ennoblement of a few rich men, but the ennoblement of large numbers of the left-liberal establishment

Posted by William D. Rubinstein

William D. Rubinstein - professor of modern history at the University of Wales, Aberystwyth and the author of Men of Property: The Very Wealthy in Britain since the Industrial Revolution - puts the cash for honours scandal into historical perspective and argues that the real problem with Blair's peerages is not that too many have gone to rich businessmen but that too many have gone to representatives of left-liberal lobbies.

Since a scandal over the honours system might well bring down Tony Blair as Prime Minister, it might be useful to place his record in the area of creating new titles in a wider historical context. Every Prime Minister creates new peerages and knighthoods. Many perforce have gone to wealthy men, and, with virtually every Prime Minister, there has been at least an implication that superlative merit alone was insufficient to explain their elevation. A number of studies of the creation of peerages and life peerages by scholars, including this author, can cast some useful light on how modern Prime Ministers have treated the honours system.

David Lloyd George was, of course, notorious for his peerage creations. How justified is this lasting reputation? In his five and a half years as Prime Minister, Lloyd George created ninety-one new peers, an average of sixteen per year. This was indeed a high total, much higher than the annual average of six new peers created by Lord Salisbury or the eleven created by H. H. Asquith. Nevertheless, there were many extenuating circumstances.

The Parliament which was in place during the First World War was dissolved in November 1918 after having gone eight years without a general election, its life extended by the necessity to avoid an election in the middle of a brutal war. Lloyd George was thus faced by an unusual number of retirements among senior MPs.

Lloyd George also had to honour the senior military commanders of the War. Sir Douglas Haig received an earldom, the official Thanks of Parliament, and a tax-free grant of 100,000, around 6 million in today's money. Other senior generals and admirals also received peerages, and several others also received substantial tax-free grants for winning the War. It is unnecessary to add that the actual soldiers and sailors received nothing.

However, Haig's monetary reward demonstrated an historical downward decline: Wellington received 500,000, as well as a dukedom, for defeating Napoleon. Although the leading British military commanders of the Second World War would be regarded by most historians as far better, as military leaders, than those of the Great War, Montgomery et al. received only peerages, not money, which the post-war Labour government had no means or desire to hand out.

The aftermath of the First World War was, in fact, the last time in British history that newly-created peers received money along with their titles. Many would question whether it would not have been more appropriate for the senior commanders of the Great War to have received the short end of a noose rather than a seat in the Upper House, but Lloyd George was obliged to honour them, and none of his critics - certainly none in the Tory party - criticised these titles.

Lloyd George also gave peerages to Empire figures and also to a good many wartime or postwar Ministers in order to bring them into the government, or use them soon after their elevation. For instance, the Canadian Sir Max Aitken became Lord Beaverbrook in 1917 and was given a Cabinet post in February 1918.

Few of these creations caused a public scandal. What we know as the "Lloyd George Honours Scandal" chiefly concerned his very last group of peers in 1922, a list which included William Vestey, the millionaire shipowner and frozen meat king who had emigrated to Argentina to avoid paying taxes, and then returned to England after creating an elaborate international network, with dummy holding companies in France and elsewhere, that guaranteed a virtual tax free income, and Sir Joseph Robinson, a mega-wealthy South African gold magnate so notorious that he was forced to "return" his peerage shortly after it was announced.

Right-wing Tories, looking for an excuse to end the Lloyd George Coalition government, seized on these Honours scandals to undermine the Prime Minister, and the mud has stuck ever since.

Via Maundy Gregory, the honours "bagman", Lloyd George certainly sold titles - Cardiff became known as the "city of dreadful knights" - although this was nothing new, and it was Lloyd George's openness, rather than the novelty of this arrangement, which led to scandal. Some peerage-purchasers proved rather clever at what they were doing. Sir James Buchanan, a multimillionaire Scottish whisky distiller, wanted to become Lord Woolavington in the 1922 New Years Honours List, so he signed his cheque "Woolavington", and dated it "2 January 1922" - no peerage, and the cheque would bounce. He indeed became Lord Woolavington.

Peerage creations continued at roughly the same rate: Winston Churchill created an annual average of eleven per year in his wartime administration of 1940-45, while Clement Attlee created nine per year - until the passage of the Life Peerage Act of 1958, which opened the floodgates. Many pro-Labour figures, or poor men (and, from 1958, women) for whom an hereditary title would be ridiculous, were more than happy to accept a title which ceased with their own demise.

In his 1964-70 government Harold Wilson created no fewer than 154 life peerages (and six hereditaries, all nominated by Sir Alec Douglas-Home at the end of his term). Nothing daunted, Wilson created another 84 life peerages in the two years of this second term in Downing Street from 1974-76. This made an all-up total for Wilson of 234 life peerages, compared with just thirty-four created by Edward Heath from 1970-74. To be sure, Wilson had to create many Labour peers to have a respectable total in the Tory-dominated Lords, but Wilson famously handed out titles like their was no tomorrow, awarding life peerages to his secretary, his solicitor, his doctor, his favourite raincoat manufacturer, and many others in his personal entourage.

Since then, there has been a steady and vast escalation in the number of life peer creations: sixty by James Callaghan; 204 (plus four new hereditaries) by Margaret Thatcher; 172 by John Major. Tony Blair has, however, outdone them all, creating 153 life peers between his election in May 1997 and the end of 1999, plus around 200-250 more since then (and one new hereditary, the Earl of Wessex).

The problem with Tony Blair's new peerages is not that they were sold for cash down or for services rendered, but the precise opposite, that far too many have gone to worthy but predictable and obscure exemplars of certain components among the great and the good. A glance through Dod's Parliamentary Companion will show very few Lord Levys or other wealthy recent creations, but a very great many of little-known spokespeople for the welfare lobby, the disability lobby, the children's wellbeing lobby, the ethnic lobby, the local government lobby, the public services union lobby, the Third World lobby, and like ilk - men and women who are, no doubt, model citizens, but who are drawn overwhelmingly from the ranks of tender-minded left-liberals, in complete contrast to the situation in the past.

Die-hard Tories and tough-minded opponents of crime, unlimited welfare, high government spending on social causes, and of unchecked immigration have been notable for their absence from the newly-ennobled during the past decade. Given that 80 per cent of the hereditary peers are no longer there, but the Anglican bishops still remain, the House of Lords today has a "bleeding heart" ambiance quite unlike anything known in the past.

The future of the Lords is, of course, very much up in the air although, despite a spate of recent discussion of change, real reform may well remain in the "too hard" basket. Traditionalists will probably hope the topic will always remain there.

The most common proposed reform is for another lot of elected local politicians, serving long terms as regional representatives, a cure obviously worse than the disease. Such a change would manifestly not be an improvement on the current House of Lords, but would certainly lead to many clashes of authority with the House of Commons. Warts and all, the House of Lords is best left alone.

William D. Rubinstein is professor of modern history at the University of Wales-Aberystwyth. He is the author of Men of Property: The Very Wealthy in Britain since the Industrial Revolution, (Social Affairs Unit, 2006).

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A very timely and informative piece - especially on the context surrounding the 'reputation' bestowed on Lloyd George. It all certainly confirms me further in my opinion that the whole Honours system stinks and is a cancer within the British body politic.

However, I take there is an argument that if you remove this licenced corruption, it will simply re-appear in other forms and ways that are even mopre pernicious?

Posted by: Ted Harvey at February 26, 2007 06:53 PM
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