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APRIL 15, 2002

The explosive issue of tobacco

THE TIMES newspaper in London put Bernie Ecclestone back on the front pages on Monday with a story alleging that the British Prime Minister's chief of staff Jonathan Powell was the man who approached the Formula 1 boss back in 1996 asking for a donation from the Labour Party. That donation caused ructions in British politics at the time and Ecclestone was presented as a man who had been trying to buy favors from Tony Blair's government. Blair, caught out by the disclosures, did not mention the fact that it was Powell who made the first approach - which would have been an enormous embarrassment at the time. The new allegations demolish the accepted theory that Ecclestone went to Labour and offered funding in exchange for an exemption for motor racing from a planned European tobacco ban.

The new twist to the story casts everyone in the sport in a good light and raises questions about whether the chief of staff of a Prime Minister should be engaged in fund-raising for a party. It is likely to cause Blair some uncomfortable moments if any of the Opposition politicians take advantage of the revelations.

It is not coincidence that the story has come to light on the same day as the FIA has launched a new initiative on tobacco and the source of The Times story is one of Max Mosley's closest aides David Ward, now the head of the FIA Foundation and Secretary-General of the FIA's automobile division. Ward, a former top level political aide with John Smith, the leader of the Labour Party before Tony Blair took over, says it was he who put Powell in touch with Mosley and claimed that it was Mosley who convinced Ecclestone to make the donation. Ward says that he was horrified when the FIA was linked the scandal in England as it cast a dark shadow over the real FIA policy on tobacco.

The fact that The Times story popped up on the same day as Mosley addressed the Legal Affairs Committee of the European Parliament in Brussels, to outline the FIA's policy on tobacco sponsorship, is obviously deliberate and indicates a concerted effort to cast the FIA in a better light and draw extra publicity to its new policy of tobacco which calls for a worldwide ban in 2006.

There are people within the EU who would like to see a Pan-European tobacco ban introduced before the end of 2006 and the FIA pronouncement appears to be a very nicely disguised attempt to make sure that this does not happen and the argument being used is very sound.

"An effective ban requires world-wide agreement," an FIA statement read. "The FIA believes that only a world-wide agreement to control tobacco sponsorship of sport will be effective. International motor sport championships such as the FIA's Formula 1 World Championship and World Rally Championship consist of a series of events held in countries all around the world. By far the largest audience for these events are television viewers rather than the spectators attending the race or rally. In any individual country television viewers during the year are watching events from all around the world. These events are subject to very different rules regarding tobacco advertising and sponsorship" which mean that tobacco advertising is still beamed into countries where it is banned via television coverage from countries where tobacco sponsorship is tolerated.

European politicians have been inclined to ignore these arguments up to now but the FIA has not lobbed a political hand grenade into the debate by bringing up the issue of the EU's

"We strongly believe that the European Commission should end its system of subsidy for tobacco production in the EU," the FIA statement said. "It clearly undermines the credibility of the EU's anti-smoking policies".

The tobacco subsidies are hugely controversial not least because of allegations of massive frauds, a view which was strengthened in 1993 when a former head of the tobacco division of the European Commission's agricultural directorate mysteriously fell out of a sixth floor window in Brussels - just days before he was to be questioned by investigators.

Tobacco keeps large numbers of people in work - even when the farms are not profitable - and stopping the subsidies would cause massive job losses. The efficiency of the tobacco farmers has also been called into question in the past and about half the tobacco produced by the EU's farmers is sold cheaply in Eastern Europe and North Africa because it is not good enough for the European cigarette makers, who import 75% of their tobacco from abroad.

Linking the two issues will make it lot more difficult for the European Union to force through a tobacco ban earlier than the FIA's planned deadline of 2006.