In a desperate attempt to save his job, the embattled Defence Secretary admitted he had ‘blurred the line’ between his personal and professional life.
Despite weekend speculation that Dr Fox would be cut adrift, David Cameron took the high-risk step of backing him last night. Senior sources said the Prime Minister was ‘determined’ Dr Fox should stay in his job barring further explosive revelations.
But the Defence Secretary must still await the outcome of a report today into his dealings with self-styled ‘adviser’ Adam Werritty, his best man and former flatmate. And he faces a torrid session in the Commons, where he will report to MPs on his recent trip to Libya.
In his statement, Dr Fox admitted his self styled ‘adviser’ Mr Werritty has financial interests in the defence industry and his frequent contacts with him could have given an impression of ‘wrongdoing’.
He also appeared to accept a potential breach of the ministerial code, which states that ministers must not only ensure no conflict arises between their public duties and private interests, but also that none ‘could reasonably be perceived to arise’.
And as new questions were asked about meetings Mr Werritty attended with Mr Fox in Dubai and Sri Lanka, the Defence Secretary conceded he had allowed his professional judgment to be clouded but insisted he had done nothing wrong.
The apology came just three days after Mr Fox had dismissed as ‘baseless’ allegations of special access for an old friend. Allies said he was determined to save his Cabinet job and is even prepared to cut links with Mr Werritty, who met him 14 times in the Ministry of Defence in just over a year.
On a day of political drama, both Dr Fox’s statement and Mr Cameron’s intervention appeared to pre-empt the findings of the inquiry into the Defence Secretary’s relationship with Mr Werritty, due on the Prime Minister’s desk today.
Dr Fox, seen as the keeper of the Thatcherite flame in the Cabinet, arrived back from Libya in the early hours of yesterday and he and the Prime Minister held crisis talks over a growing tide of allegations and innuendo. He is understood to have apologised to Mr Cameron.
Labour has accused the Defence Secretary of lying over one meeting brokered in Dubai by Mr Werritty, at which a highly sensitive telecommunications deal to allow soldiers to phone relatives and a controversial High Court battle were discussed with a Dubai businessman.
The Defence Secretary admitted last night that no civil servant was present at the meeting, and aides insisted his Labour shadow Jim Murphy must have ‘misunderstood’ if he believed Dr Fox had told him a Ministry of Defence official was there. In his statement, Dr Fox conceded his close ties to Mr Werritty might have given the ‘misleading impression’ that he was an official adviser. He insists that as soon as he became aware that his friend was handing out business cards styling himself as an adviser to him he told him to stop.
Labour’s former Armed Forces Minister Kevan Jones said Dr Fox’s statement was ‘remarkable’.
‘Just 24 hours ago Liam Fox called these allegations “baseless” and now he has apologised, but yet is denying any wrongdoing took place,’ he said.
‘The Defence Secretary simply cannot have sensitive meetings behind the back of his officials. This is incredibly serious and this response is incredible.’
One factor in Mr Cameron’s support for Dr Fox is concern that he could become a focal point for right-wing disaffection with the Coalition if he returned to the back benches.
Colleagues are privately bewildered that Dr Fox has put his career at risk for the sake of a friendship.
‘Nobody really thinks there is anything inappropriate, and the innuendo that has been put about by Labour is really quite sickening. But it’s a bit like William Hague – there’s a slight naivety about how a friendship could look to others.’
Friends said Dr Fox was determined to ride out the storm and will face questions on the affair today in the House of Commons.
‘He’s contrite, he accepts that mistakes were made,’ said one. ‘He knows he shouldn’t have allowed any impression of wrongdoing to occur or allowed people to think there was any crossover between his professional role and his friendship.
‘Obviously it’s been a very difficult few days but he is determined to carry on.’
The most damaging allegations facing Dr Fox concern a meeting in a Dubai hotel in June with Adam Werritty and three businessmen at which a sensitive telecommunications deal was discussed. One of the three was Harvey Boulter, chief executive of Porton Capital, whose subsidiary Cellcrypt wanted to sell the Ministry of Defence voice encryption technology to allow soldiers in Afghanistan to phone relatives without fear that the Taliban was listening in.
Crucially, a high-profile court case that Mr Boulter was fighting against an American firm was allegedly brought up. Dr Fox had always admitted the meeting took place, but claimed it occurred only because the businessmen happened to be on a table next to them. He also told the Shadow Defence Secretary that an MoD official was present. However, emails from Mr Werritty, which emerged yesterday, appear to show that he had been trying to arrange the meeting since at least April. In addition, Dr Fox now admits that there was no official at the meeting.
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