One footnote from the Charity Commission report into Gordon Brown’s Smith Institute is positively Nixonian.

You have the right to remain silent but….

Labour are spinning that the report clears Gordon of any links to the Institute. Which is complete bollocks. The Treasury Minister John Healey welcomed attendees to Number 11 in December 2004 thus:

“I am a last-minute substitute for Gordon Brown, so I would like, on his behalf, to welcome you all to Number 11 Downing Street. I know, looking around, some of you are quite regular attendees of Smith Institute seminars, and you will know you get a letter from Wilf Stevenson before each one explaining that you are invited to Number 11 by Kind permission of the Chancellor. I have to say, this series of seminars in particular is being held not so much by the kind permission of the Chancellor, but by his absolute insistence that they take place. He is unable to be with us now, but he will want to know exactly what has been said in the discussion when I see him earlier this morning. Many of you, including and perhaps especially the panel here, have known Gordon for a long time”

The Centre for Open Politics has summarised the web of close links to Gordon Brown in a single document.

By Robert Hutton and Gonzalo Vina

July 18 (Bloomberg) — Britain’s charity regulator criticized the Smith Institute over its links with Gordon Brown and his Labour Party, saying it failed to maintain the political neutrality required for its tax-exempt status.

The Charity Commission also said Brown failed to answer its questions about his relationship with the institute, which is run by a university friend of his, Wilf Stevenson. Smith trustees include Murray Elder, a childhood friend of Brown, and three men who helped fund his bid to become prime minister.

“It is shocking that Brown refused to respond to any correspondence from the Charity Commission during their inquiry,” said Greg Clark, a lawmaker for the Conservative opposition who speaks on charities. “The Smith Institute did act in a party political way that was wholly inappropriate.”

While the report clears the charity over its 2004 decision to hire Ed Balls, a former Brown aide now serving in the Cabinet, it says the trustees didn’t do enough to supervise the “inappropriate party political” work of Bob Shrum, a U.S. electoral strategist it employed to replace Balls, and concludes that on several occasions the charity’s work was “compromised by a party political association.”

“Trustees of charitable think tanks have a responsibility to ensure the political neutrality of the work they do,” Andrew Hind, chief executive of the Charity Commission, said in a statement today. “However, the trustees did not adequately manage the risks posed to the independence and reputation of the institute. It was vulnerable to the perception that it was involved in party politics — never acceptable for a charity.”

`Substantial Steps’

Paul Myners, deputy chairman of the Smith Institute, insisted the charity was politically neutral. While he and his fellow trustees “strongly believe” their procedures had been sufficient, they had taken “substantial steps to enhance our advisory structures and to bring our governance more generally into line with best practice,” he said in an e-mailed statement.

The Charity Commission used its legal powers to order the Smith Institute to review how it’s run, and give an answer within six months. The Commission will also visit the charity in a year to ensure it’s changed its methods.

Brown’s spokesman, Michael Ellam, didn’t answer questions on why Brown hadn’t responded to the commission’s questions when asked about the matter at his daily briefing in London.

Tax-Exempt Status

Under U.K. law, registered charities don’t pay tax and can claim from the Treasury a top-up on donations. In return, they are forbidden from supporting political parties or candidates.

The Smith Institute is one of a handful of political research groups in the U.K. with charitable status, working alongside Demos, the Institute for Public Policy Research and the Social Market Foundation.

It was set up in 1997 in memory of John Smith, who led the Labour Party from 1992 until his death in 1994. Stevenson is a friend of Brown and the editor of two books of Brown’s collected speeches, published in September.

The Charity Commission began its formal inquiry in February 2007 over an event it held in March 2006, where Shrum discussed strategies for battling opposition Conservative leader David Cameron. It had already been examining its 2004 decision to appoint Balls, then a former aide to Brown at the Treasury. Balls worked for the institute as a research fellow.

The commission’s 52-page report followed a 17-month inquiry. It concludes that Shrum, who left the role in April 2007, had run two events for the institute, neither of which were compatible with the charity’s purpose.

`Write Whatever You Want’

At one of these, in March 2006, Shrum discussed with Balls and Douglas Alexander, now International Development Secretary, how Labour should fight the opposition Conservatives at the next election.

“I was invited to give a talk, I gave a talk,” Shrum, a veteran of Democratic presidential campaigns including those of Al Gore in 2000 and John Kerry in 2004, said in a telephone interview from the U.S. today. “You can write whatever you want.”

Shrum has refused to talk about his relationship with Brown in the past, beyond saying he’s an admirer. The Times newspaper reported in September that he had helped draft Brown’s speech to the Labour Party conference that month.

The report also criticizes the institute’s decision to continue using 11 Downing Street, the official residence of Brown during his decade as Chancellor, as a venue for its meetings. In 2001 the Charity Commission investigated the Institute over its links to Labour, and warned it that meeting there left it open to criticism.

`Compromised’

Instead, the institute increased its use of the building, holding 27 meetings there in the year to August 2006, making Brown’s home the main venue for Smith Institute meetings. This, the Commission concluded, “may have compromised the perception of the institute’s political neutrality.”

Three of the charity’s six current trustees gave money to Brown’s campaign for the Labour leadership. Between them, Paul Myners, chair of Guardian Media Group; John Milligan, director of Ballathie Estates Ltd.; and Simon Haskel, who sits for Labour in the House of Lords; gave 42,700 pounds ($85,200), a fifth of the total Brown raised for the contest. Brown had no challenger to take over when Tony Blair retired.

Milligan and Myners were appointed as trustees following the 2001 probe into the institute. That criticized it for having too many directors who were Labour supporters.

In the inquiry that reported today, the Smith Institute told the commission that it hadn’t been aware of any political alignment for Myners. Guardian Media Group publishes “The Guardian,” a Labour-supporting newspaper.

July 18, 2008 ·