The Defence of the Realm

by Christopher Andrew

  During Tony Blair’s first term as prime minister (May 1997 to June 2001) the Security Service thought it detected only limited interest in its work at Number Ten, save on issues concerning PIRA and Northern Ireland. As shadow home secretary, Blair had described as ‘a matter of grave concern’ proposals for the Service to expand its operations into fighting organized crime and other areas.136 During each public spending round in Blair’s first term, the intelligence agencies feared Treasury attempts to make their Whitehall customers pay for the intelligence they received – thus inevitably cutting their budgets. The threat to Security Service funding was exacerbated by a sudden huge increase in the cost of the new GCHQ headquarters in Cheltenham. The Treasury line was that this had to be absorbed within the Single Intelligence Vote (SIV, the successor from 1994 to the Secret Vote) – and thus to be paid for by the whole of the intelligence community.137 The support of the cabinet secretary in keeping the Treasury at bay was of great, possibly crucial, importance in protecting the Security Service budget.

  After the cuts of the mid-1990s, the Service was thus able to grow slightly during the remainder of the decade. In the course of the decade, the proportion of operational staff increased steadily. In Lander’s view:

  We ended the 1990s as a result far better equipped to handle the demands of our ‘new work’ than we began it with:

  i. larger operational teams for surveillance, interception, eavesdropping and other technical operations;

  ii. more officers capable of hard agent running (e.g. against terrorist or drugs targets);

  iii. a far smaller clerical and bureaucratic tail facilitated by an excellent new building; and

  iv. an SCS [senior civil service] equivalent senior management nearly 40% smaller.

  By any measure as a consequence we left the decade a more capable and efficient organisation than we began it.138

  One of the Service’s ablest strategic thinkers at the end of the Cold War, H1/0, had correctly forecast in 1990 that, though the disappearance of the Communist threat might diminish the coherence of its role ‘during the next few years’, it would recover that coherence if it succeeded in gaining ‘responsibility for all internal and external terrorism’.139

  At 6 p.m. on 9 February 1996, PIRA abruptly announced the end of a seventeen-month ceasefire. Just over an hour later, a huge bomb placed in a car park near South Quay Docklands Light Railway station by Canary Wharf on the Isle of Dogs exploded, killing two men, injuring more than a hundred, laying waste a large area and causing £85 million worth of damage. A close observer of the Provisionals concluded that ‘Had the IRA not bombed Docklands, it would have probably split.’140 The South Quay attack was followed by the planting of two smaller devices; one was successfully defused, the second exploded prematurely on 18 February. An arms cache discovered subsequently indicated that these were probably intended to be the beginning of a prolonged campaign.141 Though there were three relatively small-scale bomb attacks in London during March and April, T2 reported on 11 June: ‘Intelligence suggests that PIRA is disappointed with the performance of its mainland-based ASUs since South Quay, and is anxious to rectify the situation.’142 On the same day the DDG told the Cabinet Official Committee on Terrorism, ‘It seemed that preparations for a major attack in Great Britain were well advanced . . .’143 Five days later, on the morning of 15 June, a total of five warning telephone calls, using an authenticated PIRA codeword, were received by three television stations, Salford University and North Manchester General Hospital, warning that a bomb would explode at the Arndale Centre in central Manchester in an hour’s time. Though, thanks to a hasty mass evacuation of the city centre, there were no fatalities, more than 200 people were injured in the blast, which also caused damage to buildings estimated at £450 million. Operation SITUATED failed to identify the members of the ASU responsible.144

  The Security Service leadership remained anxious that the Manchester bombing should not stand in the way of negotiations with the Provisionals. One of the directors recalls being struck by the ‘step-change’ in the Service’s intelligence assessments, which now regularly included political analysis: ‘We had helped to formulate similar assessments produced at Stormont for SOSNI, but earlier Box 500 reports issued on the mainland focused on security intelligence, and presumably left political assessments to the Cabinet Office and the JIC.’ Though ASCRIBE was partly responsible for the ‘step-change’, it was also influenced by ‘the personalities driving our Irish work, especially Stephen Lander and Eliza Manningham-Buller’. On 17 June, two days after the bomb attack in Manchester, Lander, who had succeeded Rimington as DG two months earlier, recommended to Major that ‘the Government should continue with its current strategy’, which included ‘providing reassurance to the Provisional leadership about the nature of the talks process which is on offer’.145

  While Lander was briefing the Prime Minister, PIRA was launching an audacious attempt to disrupt the whole of Greater London’s power supply. Operation AIRLINES, which defeated the PIRA attempt to do so, began with intelligence that a member of an ASU had taken up residence at 58 Woodbury Street, Tooting Broadway. Surveillance on 8 July 1996 observed an individual codenamed PARADISE NEWS (later identified after his arrest as Donal Gannon, a trained electrician and one of PIRA’s leading experts in the design and manufacture of explosive devices) arriving at the address. Less than an hour later another individual, codenamed ANOTHER TOMORROW (subsequently identified as the former US marine John Crawley, who had served ten years in jail in the Irish Republic from 1984 to 1994 for his part in shipping arms from America to the Provisionals),146 emerged from the house. Not long afterwards Gannon and TULIP STEM (later identified as Gerard Hanratty, who had been convicted in 1988 on the continent of relatively minor arms offences) were followed as they travelled in a blue Peugeot 405 to reconnoitre electricity sub-stations. While Gannon returned to Woodbury Street, Hanratty was tailed to a flat in Verona Court, 68 St James’s Drive, in Tooting. Next day a fourth member of the ASU, codenamed BREAD BOARD (quickly identified as Eoin Morrow, a PIRA specialist in the manufacture of improvised explosive devices (IEDs) and the use of radio-control systems who had served a prison term in the Republic for armed robbery), was observed at Woodbury Street, and Gannon was followed to a house at 61 Lugard Road in Peckham. In the course of the day Crawley and Gannon were observed making inquiries about self-storage facilities and the transmission of Irish money orders. That evening Gannon was observed meeting a fifth ASU member, RAVE DOWN, at Wimbledon Park Underground station; RAVE DOWN went to stay with Hanratty in the Verona Court flat. On 11 July Gannon was followed to Birmingham where he met an individual codenamed GALLERY PICTURE in the Brewery Tap public house, before the two men went to view a storage unit on the Brownhills industrial estate. Meanwhile two further ASU members were observed entering 61 Lugard Road: CRAFT FAIR and EXCESS MONEY (later identified as, respectively, Patrick Martin, a Belfast Provisional and known associate of Hanratty, and Francis Rafferty, also from Belfast but previously unknown to the Security Service).147 John Grieve, commander of SO13 at Scotland Yard, later described the ASU as one of the ablest and most experienced in PIRA history.148

  Over the next few days the members of the ASU were observed purchasing a Ford Sierra for £2,200 in cash, moving around bulky holdalls, reconnoitring further electricity sub-stations and carrying out various antisurveillance procedures. At 2.35 a.m. on 15 July the police entered all three ASU addresses. Crawley, Gannon, Hanratty, Martin and RAVE DOWN were arrested at Woodbury Street, Rafferty and Morrow at Lugard Road. The timers and power units (though not the detonators and Semtex explosive) for thirty-seven partially assembled IEDs were also discovered during the search of Lugard Road. The flat at Verona Court was empty; it was subsequently discovered that the ASU had abandoned it after compromising its security by using a forged £20 note to pay the rent. Later the same day, GALLERY PICTURE was arrested in Birmingham. With the exception of RAVE DOWN, whose case in court was that he had been a me
re messenger, and GALLERY PICTURE, the arrested ASU members were each convicted and sentenced to thirty-five years’ imprisonment. Had the ASU achieved its aims, the results would have been devastating.149 The ASU members claimed improbably during the trial that they had intended only to use hoax devices and not actually to disrupt the London power supply.150

  But for the arrest of the AIRLINES ASU, its next major target might well have been Birmingham – as had been indicated by a series of intelligence reports in June and July. Gannon’s attempt to obtain a storage facility in Birmingham also points clearly in that direction.151 AIRLINES, possibly the Security Service’s most successful anti-PIRA operation, was followed by Operation TINNITUS, which disrupted a Provisional attempt during August and September 1996 to mount a major attack – probably using vehicle-borne IEDs – against central London. On 23 September 1996 four members of an ASU operating in London were arrested; a fifth (Dermot O’Neill) was shot during the arrests and later died from his wounds. Four large boxes each containing a large quantity of HME-ANS (ammonium nitrate/sugar), an additional 3 tonnes of bagged HME-ANS, weapons and under-vehicle devices were recovered from a self-storage unit in Cranford Way, Hornsey.152

  In the aftermath of AIRLINES and TINNITUS, Lander was in cautiously confident mood. In a private lecture on terrorism, he told the audience: ‘Even terrorists regard the UK as a hostile and risky environment. We know this from what intelligence tells us terrorist groups and hostile states think. We also hear it from the terrorists themselves.’ ‘No one’, claimed Lander, ‘has a better record.’153 That record, in the Service’s view, contributed to PIRA’s renewed willingness to consider a compromise political settlement.

  Labour’s landslide election victory on 1 May 1997 was quickly followed by a new political initiative. The new SOSNI, Mo Mowlam, whose forcefully frank negotiating style and ability to win Republican trust (at the inevitable cost of provoking Unionist distrust) made her a crucial part of that initiative, greeted the DG at their first meeting with the question: ‘Why should I believe a word you say?’ She quickly came to do so.154 On 19 July PIRA announced an ‘unequivocal’ restoration of the August 1994 ceasefire from noon on the following day. Despite what seemed to be Tony Blair’s general lack of interest in the intelligence community on taking office,155 the Security Service noted that he appeared to pay ‘close attention’ to its Northern Ireland Intelligence Reports (NIIRs).156 In 1997–8 the Service’s Whitehall and Northern Ireland customers judged 80 per cent of NIIR reporting ‘very valuable’ or ‘exceptionally valuable’.157 Lander was able to tell the Prime Minister at a meeting on 30 October 1997 that, while he could not rule out the possibility of a further PIRA surprise attack such as that on Canary Wharf, intelligence on the thinking and plans of the Provisional leadership had improved. Though a meeting earlier in the month of the General Army Convention, which represented PIRA rank and file, had led to some resignations by hardliners, the overall outcome had ‘boosted the leadership’s confidence’: ‘Some key figures . . . probably see the ceasefire as a genuine opportunity to reach a settlement. Both intelligence and overt reporting indicate that they are prepared to consider a settlement which stops short of a united Ireland.’158

  By January 1998 it was clear that the only settlement on offer by London and Dublin was one which balanced British and Irish constitutional change: a Northern Ireland assembly, a new Anglo-Irish agreement, a British–Irish Council linking the Assembly to other UK bodies, and North–South structures. Parts of the final Belfast (Good Friday) Agreement were, unsurprisingly and perhaps creatively, ambiguous. The core of the Agreement, however, was unambiguous. Northern Ireland would remain part of the United Kingdom as long as it was supported by a majority of its people. In return Unionists were required to accept power-sharing and cross-border co-operation – and to allow Sinn Fein a ‘soft landing’ into the political arena. The issues of the release of Republican prisoners and, still more, of decommissioning the large PIRA arsenal inevitably remained contentious. The Security Service reported before the referendum on the Agreement: ‘Whilst many members of PIRA were initially sceptical about the Agreement, the long-held assumption by volunteers that PIRA would return to violence in May appears to have diminished.’159 The referendum on 22 May produced the highest turnout in Northern Ireland since 1921, with a 71.1 per cent majority in favour – substantially higher, according to opinion polls, among the nationalist community than among the Unionists.160 The large nationalist majority in favour increased its acceptability to Republicans.

  President Bill Clinton had declared after the signing of the Belfast (Good Friday) Agreement: ‘Peace is no longer a dream, it is a reality.’161 More than a decade later, despite the manifold travails of the peace process, it remains so.

  1 When P Branch, founded by Duff in 1987 to review internal organization and procedures, was wound up in 1990, its policy and planning function was transferred to H Branch. See Appendix 3, p. 000.

  2

  Holy Terror

  Like thousands of other foreign Muslims, Usama bin Laden (UBL), son of a Saudi billionaire and the most dangerous religious extremist in the history of contemporary terrorism, travelled to Afghanistan in the 1980s to take part in the victorious jihad1 against Soviet occupying forces. ‘In our religion,’ he later told Time magazine, ‘there is a special place in the hereafter for those who participate in jihad. One day in Afghanistan was like 1,000 days of praying in an ordinary mosque.’1 In 1988 he established Al Qaida (‘The Base’) to continue jihad outside Afghanistan when the war was over.2 UBL first came to the notice of the Security Service in January 1993 in connection with the attempted assassination a month earlier of a member of the Politburo of the Marxist Yemeni Socialist Party (regarded by UBL as apostates) and bomb attacks aimed at US servicemen in two Aden hotels. The attacks were bungled, killing an Australian tourist and a Yemeni hotel worker but no Americans or Yemeni Marxists. The perpetrators were caught and confessed that the operations had been organized by the Egyptian terrorist group Islamic Jihad led by Ayman al Zawahiri (later UBL’s deputy) and financed by Bin Laden.3 As yet, however, both Bin Laden and the Yemen attacks attracted little attention from intelligence communities on either side of the Atlantic.4 Though the Security Service was receiving reports on Bin Laden from early in 1993, a permanent file was not opened until two years later.

  A wide-ranging internal Security Service study on ‘The Origins of Terrorism’ commissioned in 1994 still saw no serious threat from the transnational Islamist terrorism which was to preoccupy the Service in the first decade of the twenty-first century. ‘Religious terrorism’, the study concluded, became a ‘potent’ force only when allied to national interests.5 For most of the 1990s the Service believed that the principal non-Irish terrorist threat came from Middle Eastern state-sponsored terrorism.6 The main practitioner of state terrorism in Britain during the 1990s was believed to be the Iranian Ministry of Intelligence and Security (MOIS). Within Europe MOIS’s most frequent targets were Iranian Kurdish dissidents, of whom at least seventeen were assassinated between 1989 and 1997. The highest-profile victim of MOIS foreign operations, assassinated in Paris in 1991, was the Shah’s last Prime Minister, Shahpur Bakhtiar, an outspoken critic of the Islamic Republic established by the Ayatollah Khomeini twelve years before.7 The fact that none of the killings took place in the UK8 probably owed much to successful Security Service and Special Branch surveillance and periodic disruption of MOIS operations against dissidents.

  The main target of MOIS UK operations during the 1990s, some of them assisted by its Lebanese Shia ally, Hizballah (‘Party of God’),9 was one of Britain’s best-known writers, the Indian-born Salman Rushdie, author of the novel The Satanic Verses, whose title referred to the medieval legend (deeply insulting to most Muslims), retold by Rushdie, that some of the Quran’s original verses originated with Satan and were later deleted by Muhammad. In February 1989, four months before his death, Ayatollah Khomeini issued a fatwa condemning Rushdie a
nd his publishers to death for blasphemy: ‘I call on zealous Muslims to execute them quickly, wherever they find them, so that no one will dare to insult Islam again.’ Faced with ‘the loudest death-threat in history’, Rushdie was forced to go into hiding, protected by the Special Branch. A few days after the issue of the fatwa, he watched on television as he was burned in effigy at a demonstration in Pakistan attended by tens of thousands of chanting protesters.10 Protests among British Muslims had begun even before the fatwa but increased greatly afterwards. An estimated 20,000 protesters from across Britain took part in an anti-Rushdie demonstration in London on 27 May 1989. There were several arson attacks on bookshops selling The Satanic Verses, but the amateurish devices used in the attacks indicated that no established terrorist group was involved.11 The hate campaign against Rushdie, though its significance was not fully grasped at the time, began the radicalization of a minority of young British Muslims.

  The main threat to Rushdie’s life, however, came not from extremist British Muslims but from MOIS operations.12 The deadly seriousness of the threat was demonstrated by the stabbing in 1991 of both the Japanese translator of The Satanic Verses, who was killed, and the Italian translator, who survived. In 1993 the Norwegian publisher was injured in a gun attack.13 The Security Service learned in May 1992 that Mehdi Seyed Sadighi of the MOIS London station was tasked with collecting operational intelligence on Rushdie. Sadighi was expelled,14 as was a second MOIS officer who operated under student cover. Over the next few months there was a series of MOIS-inspired operations to target Rushdie.15 Others continued more intermittently for the rest of the decade.16 The fact that none succeeded, despite MOIS’s success in carrying out assassinations on the continent, was probably due mainly to a combination of expert protection and good intelligence.