How Mohamed Al Fayed left a lasting legacy on British politics with the ‘cash for questions’ scandal
Mohamed Al Fayed and “cash for questions” probably did more to bring about the downfall of John Major’s government than any of the other political scandals of the 1990s.
It was Al Fayed’s bribery of Tory MPs Neil Hamilton and Tim Smith – in cash stuffed in brown envelopes – and hospitality at his luxury Ritz Hotel in Paris for cabinet minister Jonathan Aitken that led to the word “sleaze” being associated with the Major government.
It was almost certainly more damaging than the several sex scandals that engulfed Major’s government in the ’90s, because it involved financial impropriety and corruption and projected an image of dishonesty and Tory MPs on the take.
Hamilton was the Thatcherite MP for Tatton in the Cheshire stockbroker belt – a seat later represented by Tory chancellor George Osborne – and was made a junior minister at the Department of Trade and Industry, responsible for the City and corporate affairs, by Major after his surprise general election victory in 1992.
Neil Hamilton in 1994, while he was trade minister
But two years later, in 1994, it was revealed that he had taken cash for asking parliamentary questions on behalf of Al Fayed, along with Smith, who had been MP for Beaconsfield since defeating Tony Blair in a by-election in 1982.
Both MPs had failed to declare the donations from the Harrods tycoon.
It was to cost them their political careers and rob the Conservatives of one of their safest seats, Tatton, in the Blair landslide victory in 1997.
Al Fayed claimed he paid Hamilton up to £110,000 and also gave him Harrods gift vouchers and a free holiday at his Ritz Hotel in Paris, in return for asking parliamentary questions about Harrods during his battle for control of the store with Lonrho tycoon Tiny Rowland.
Smith – also a junior minister – was said to have received between £18,000 and £25,000, handed over in brown envelopes stuffed with £50 notes.
Mohamed Al Fayed in 1997
He quit straight away, but Hamilton battled on in a futile bid to clear his name.
Aitken, Major’s chief secretary to the Treasury and a former defence procurement minister, was revealed to have stayed without charge at the Ritz in Paris at the same time as Saudi arms dealers.
He sued for libel but was later convicted of perjury and served a jail term.
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Smith stood down from parliament in 1997 but Hamilton attempted to cling on in Tatton, but was comprehensively defeated by the so-called “man in the white suit”, anti-sleaze candidate Martin Bell, who was backed by Labour and the Liberal Democrats.
Jonathan Aitken in 1995
The hugely damaging scandal led Major to set up the Committee for Standards in Public Life, which is still operating, though criticised at times for being toothless.
But despite its critics, the committee remains a lasting legacy of the cash-for-questions scandal and advises prime ministers, civil servants and parliament to this day.
And the committee’s best-known former chairman, Sir Alastair Graham, who headed the committee from 2004 to 2007, remains a frequent critic of political scandals such as Boris Johnson’s Partygate.
Hamilton, whose notoriety led him and his extrovert wife Christine to become TV celebrities, later defected to Nigel Farage’s UKIP.
Aitken, on the other hand, turned to God in prison and is now an Anglican priest.
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There is “no doubt” the UK “will spend 3% of our GDP on defence” in the next parliament, the defence secretary has said.
John Healey’s comments come ahead of the publication of the government’s Strategic Defence Review (SDR) on Monday.
This is an assessment of the state of the armed forces, the threats facing the UK, and the military transformation required to meet them.
Prime Minister Sir Keir Starmer has previously set out a “clear ambition” to raise defence spending to 3% in the next parliament “subject to economic and fiscal conditions”.
Mr Healey has now told The Times newspaper there is a “certain decade of rising defence spending” to come, adding that this commitment “allows us to plan for the long term. It allows us to deal with the pressures.”
A government source insisted the defence secretary was “expressing an opinion, which is that he has full confidence that the government will be able to deliver on its ambition”, rather than making a new commitment.
The UK currently spends 2.3% of GDP on defence, with Sir Keir announcing plans to increase that to 2.5% by 2027 in February.
This followed mounting pressure from the White House for European nations to do more to take on responsibility for their own security and the defence of Ukraine.
The 2.3% to 2.5% increase is being paid for by controversial cuts to the international aid budget, but there are big questions over where the funding for a 3% rise would be found, given the tight state of government finances.
While a commitment will help underpin the planning assumptions made in the SDR, there is of course no guarantee a Labour government would still be in power during the next parliament to have to fulfil that pledge.
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From March: How will the UK scale up defence?
A statement from the Ministry of Defence makes it clear that the official government position has not changed in line with the defence secretary’s comments.
The statement reads: “This government has announced the largest sustained increase to defence spending since the end of the Cold War – 2.5% by 2027 and 3% in the next parliament when fiscal and economic conditions allow, including an extra £5bn this financial year.
“The SDR will rightly set the vision for how that uplift will be spent, including new capabilities to put us at the leading edge of innovation in NATO, investment in our people and making defence an engine for growth across the UK – making Britain more secure at home and strong abroad.”
Sir Keir commissioned the review shortly after taking office in July 2024. It is being led by Lord Robertson, a former Labour defence secretary and NATO secretary general.
The Ministry of Defence has already trailed a number of announcements as part of the review, including plans for a new Cyber and Electromagnetic Command and a £1bn battlefield system known as the Digital Targeting Web, which we’re told will “better connect armed forces weapons systems and allow battlefield decisions for targeting enemy threats to be made and executed faster”.
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PM Sir Keir Starmer and Defence Secretary John Healey on a nuclear submarine earlier this year. Pic: Crown Copyright 2025
On Saturday, the defence secretary announced a £1.5bn investment to tackle damp, mould and make other improvements to poor quality military housing in a bid to improve recruitment and retention.
Mr Healey pledged to “turn round what has been a national scandal for decades”, with 8,000 military family homes currently unfit for habitation.
He said: “The Strategic Defence Review, in the broad, will recognise that the fact that the world is changing, threats are increasing.
“In this new era of threat, we need a new era for defence and so the Strategic Defence Review will be the vision and direction for the way that we’ve got to strengthen our armed forces to make us more secure at home, stronger abroad, but also learn the lessons from Ukraine as well.
“So an armed forces that can be more capable of innovation more quickly, stronger to deter the threats that we face and always with people at the heart of our forces… which is why the housing commitments that we make through this strategic defence review are so important for the future.”
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