BAE 'would welcome' arms deal probe

Chairman Dick Olver said a fresh look at the evidence would show there was no chance of bringing a successful prosecution and that ending the probe had been the right decision.

The SFO halted its investigation of corruption claims surrounding the £43 billion Al Yamamah contract in December 2006 when Prime Minister Tony Blair said the Saudis had threatened to stop anti-terror co-operation.

But the High Court ruled last month that the decision, announced by then-attorney general Lord Goldsmith, had been unlawful on those grounds - a finding against which the SFO has secured permission to appeal.

Mr Olver told BBC Radio 4's Today programme: "The courts have said 'well you can't use that reason' but what I am more concerned about is the case itself which I do believe should be abandoned but for a different reason...because it is doomed to failure."

The Law Lords found that "as far as they could tell there was indeed no evidence to say that this was anything other than a legal commission", Mr Olver said.

Mr Olver welcomed Tuesday's report into the firm by Lord Woolf, the former Lord Chief Justice, following a year-long review of its current policies and practices.

Stronger anti-bribery measures, a global ethical code of conduct and abandoning some future contracts were among 23 recommendations made by an independent committee headed by the peer.

The BAE chairman said the review had been "robust, rigorous, thorough, demanding" and rejected suggestions it had been a whitewash.

"When you think what it would take to have 97,000 people behave every day according to the spirit and the content of those 23 items, that gives you an idea of what the issue is. We've got a huge task; it's a welcome task," he said, promising a programme of "continuous improvement".