Reginald McKenna
The McKenna Scandal was a political scandal within the Union of Britain that spanned the autumn of 1931. Long before the scandal, the Liberal Party - having faced an internal split at the end of the British Revolution as many members of the party went into exile following the socialist victory - had been suspected of holding prominent anti-socialist elements despite its outward loyalty to the Union government and republicanism. In the waning months of 1931, it was discovered by the press that prominent members of the right-wing of the Liberal Party - informally known as Constitutionalists - had engaged in undisclosed correspondence with noted exile, former Liberal Party politician and merchant banker Reginald McKenna. A central figure in the scandal, Abraham England claimed that any correspondence and contact with McKenna only discussed business matters, but failed to provide sufficient evidence to support his claims.
Fearing arrest under charges of treason, England and other figures connected to McKenna fled to Ireland by the end of the year. While it was never outright proven that England, or anyone else who fled, had spied for McKenna, in leaked reports published by papers such as The Guardian and the Daily Worker, it was disclosed that the men had been aware of his close contact with the Liberal exiles in Canada and he himself posed a security risk to the Union despite his supposed intentions.
Background[]
Abraham England - C. 1930
In 1924 the Liberal Party joined Austen Chamberlain's National Government and its leader, Herbert Samuel, was made Secretary of State for the Colonies. Despite on paper being an equal member of the governing coalition, discontent had emerged among the ranks of the party owing to the fact Conservatives were given high ranking positions in the government. The Liberals were already unsure of the government's plans for tariff reform and left-wing Liberals were unsure of Chamberlain's plans for further austerity. Once a bulwark of the leftward wing of the party, but who had shifted increasingly rightward, John Simon began leading a group of Liberal MPs who advocated seeking further cooperation with the Conservative Party and who, in the MacDonald government, helped engineer its collapse. Simon, and the worry of causing a schism in the Liberal Party, kept Samuel and his supporters in line with the National Government. However, following the eruption of hostilities in 1925, the Samuelite faction grew opposed to the authoritarian measures the government employed to keep order and ultimately ceremonially crossed the floor to sit in opposition. The Simonite faction remained loyal to the government and dubbed themselves "Liberal Nationals" (later renamed "National Liberals" following their exile) and much of the right wing of the party sat alongside Simon.
During the revolution, many Liberals, primarily allies of Samuel, found their sympathies shifting to the rebels, with some Liberals even attending the Liverpool Conference. The left-wing of the party, led by Robert Crewe-Milnes and Samuel, defected to the republicans and eventually formed the nucleus of the republican-era Liberal Party. While the party following the revolution was broadly left-leaning in its scope, a fledgling right-wing began to develop, composed of Simonite Liberals who either could not or chose not to escape Britain and enter exile. This faction formed around the Liberal politican and businessman, Abraham England, who had stood as a "Constitutionalist" in the 1924 general election but took on the position of Liberal whip. Right-orientated ex-Liberals and Constitutionalists joined the new party and interacted with England's clique, who by 1928 had started to refer to themselves informally as Constitutionalists. Despite sharing a name, the term in its Liberal context had nothing to do with Constitutionalism in the philosophical sense but they considered themselves adherents of the 'English constitution' of electoral democracy. This nascent faction was marked by its more right-wing politics, promoting free-trade as opposed to the more restrictive "socialist trade" and for increased foreign investments
Improper Communications[]
Allegations and rumours of Royalist sentiment within the Constitutionalists had existed since their beginning and was a label often used to tarnish the mainstream Liberal Party. In some of his earliest reports, Deputy Chair John Wheatley contended that he had reason to suspect the Liberals were unknowingly harbouring Royalist infiltrators but he did not have enough evidence to order a full-scale audit of the party. Crewe-Milnes and Samuel were often quick to declare their comrade's innocence and in a private letter to the Home Secretary, J.R. Clynes in 1929, Samuel assured him that any knowledge of seditious activities would be passed to the relevant authorities. Nevertheless, Constitutionalists continued to attract attention and harassment at elections.
However, these allegations began to become increasingly widespread in the summer of 1930 when John Ward, the sole Constitutionalist TUC member, was accused of abusing his congressional position. Ward, a civil engineering representative, had began his political career in the trade unions but took the Liberal whip in Parliament and never joined the Labour Party. Within the TUC, he was appointed to the Select Committee on Military Accommodations & Canteens - an ad hoc committee tasked with scrutinising ongoing military reforms and the improvement to military barracks. Ward first came into controversy when on the 18th of April, the Daily Worker published an exposé claiming that he had used his position to influence which engineers would receive work and had sold secrets of the barracks and their contracts to interested parties. Ward sued for libel and won in court; the Daily Worker retracted the article and apologised.
By 1931, the incident was largely forgotten but quickly re-entered the public consciousness in late October when the Guardian and Evening Standard both published articles claiming that the Constitutionalists MPs: Abraham England, John Ward and an unnamed third man had each been holding illicit correspondence with an 'exile-affiliated banker'. England and Ward both vigorously denied this was the case though on October 31st, Ward admitted that he had maintained contact with a "professional banker currently residing in North America." When pressed if this banker was a member of the exile community or resided in Canada, he refused to answer on the basis of the man's privacy. The story swelled when the following day the Guardian announced in the Sunday papers that the aforementioned 'third man' was James Henderson-Stewart, a Scottish banker and Constitutionalist MP. Henderson-Stewart denied the allegations and threatened to sue for libel but the Guardian not did retract its piece. Following the publication, Herbert Samuel publicly declared that he would task the Liberal whip into an internal investigation to the allegations. England responded that the matter was farcical and he was a victim of: "outrageous slander."
Just under two weeks later on the 13th November, investigative journalists for the Guardian announced they had discovered that the banker in question was Reginald McKenna and declared that there was now: "compelling evidence that Mr. England and his colleagues have entertained Mr. McKenna and his aides." England denied the allegations. McKenna was a prominent Liberal MP under former Prime Minister H.H. Asquith who had served as the Chancellor of the Exchequer but followed Asquith into the opposition when his government collapsed. Having lost his seat in the 1919 election, McKenna had become a merchant banker and was Chairman of the Midland Bank, the largest bank in the world. Having fled into exile in 1925, he had relocated to Ottawa and oversaw the bank-in-exile's operations from abroad, still serving as its Chairman. Despite hopes for a return to government by the British Government-in-Exile, he declined the offers and remained a private citizen albeit while renewing his membership and involvement with the National Liberals, the exile-splinter of the Liberal Party.
On the 15th of November, the letters and other correspondence were published including a collection of notes from a meeting between McKenna and the conspirators that had occurred in Belgium, provided by a source known only as 'Hugh' - suspected to be the Constitutionalist MP, John Hugh Edwards though he denied this. The correspondence between McKenna, England and other Constitutionalists was deemed to be of an "informal nature" and various matters such as life in the present state of England; the day-to-day affairs of the Provincial Parliament and the financial situation of the republic were discussed. In multiple letters, reference was made to an "Anglo-North American Free Trade Council" but no such organisation existed and it has since been regarded as an ephemeral front organisation. To the disappointment of the press, the details of the letters were not of an incriminating nature but England and his colleagues were now under immense scrutiny as to their intentions and facing allegations of participating in Royalist subterfuge and so to counter this, Henderson-Stewart publicly declared that they had maintained contact with McKenna for business related reasoning. In an open letter, England continued this explanation, depicting himself and his colleagues merely as a supporter of free trade.
Chairman Tom Mann had been maintaining a key interest in the scandal and wished to take a hard line against the conspirators, supported by his protégé Harry Pollitt. On the same day as the news broke, he summoned Deputy Chair Clynes and Home Secretary Tawney to discuss the issue. Neither man felt they could legally pursue the matter and were fearful of incurring backlash from the growing Liberal Party though this course changed when the following day, Leader of the Liberals, Herbert Samuel, made a public attack on England and demanded that he "admit honesty and submit himself to the purview of the law." Samuel had been equally blindsided by the events and was fearful of what the scandal could do to the Liberal Party as a whole and his parliamentary career. Having already been implicated in the pre-war Marconi Scandal, Samuel did not wish to invoke the government's ire and so sought to quickly solve the issue internally. England proved inflexible and condemned Samuel for attacking his own party.
Trial at the High Court[]
With the Liberals in open war, Mann sought to take advantage of the situation and ordered William Jowitt - the Attorney-General - to begin the prosecution of the Constitutionalists implicated in the affair. All but three of their representatives in Federal Congress were due to be prosecuted and six other Constitutionalist aligned Liberal activists were also given warrants. On the evening of the 20th of November, all seventeen men were summoned to London where they were to be tried at the High Court. Samuel spoke for the Liberals and proclaimed the innocence of much of the party but nonetheless pledged his full support and cooperation to the government, for which Mann personally thanked him in the TUC. The first trial began on the 25th of November with England and his co-conspirators facing charges of seditious activities and breaking the Official Secrets Act by cavorting with an agent of the enemy. The trial's proceedings were kept largely secret but nonetheless became a widespread media sensation.
Henry Hogbin
In his legal defence, England denied acting to undermine the republic or serving as a spy for the enemy. He once again claimed that his correspondence with McKenna was from a purely personal and business related standpoint - McKenna, as an international banker and fellow free trade proponent, had allegedly sought to indirectly repair trade relations between the two countries. While any lifting of the mutual-embargo was unthinkable, England charged that he and McKenna had simply "conspired to bring prosperity to all" by shifting Britain and Canada to a relaxed free trade policy on mutual terms. To the prosecution, this scheme was dimly naïve at best, outright treasonous at worst and much attention was placed on England (and his comrades') past anti-socialism and Royalist tendency. England dismissed these claims and declared that he was a "pragmatic republican." The jury remained unconvinced, with England and his comrades' fates finally sealed a week little over a week after the trial began after new evidence had been presented.
New letters had been revealed, leaking that at the very least England and Ward knew that McKenna maintained contact with Hamar Greenwood, the Viscount Greenwood, a Canadian-born lawyer and National Liberal politician affiliated to the government-in-exile. Both England and Ward denied they were aware of the McKenna-Greenwood connection with Charles Edgar Loseby - another of the MPs on trial - proposing that these letters were fabricated. Finally, character evidence of England directly attacked his claims of being a republican with the prosecution presenting evidence he had served in the Royalist Army - serving with the Royal Army Service Corps. England denied this was the case and claimed that he had left all military service in 1922 following an accident on a military base. Henry Hogbin, a fellow Constitutionalist defendant, stood to support England's claims. Hogbin was in a unique position to testify as he was not a sitting MP but rather a high-level civil servant at the Ministry of Agriculture & Fisheries. Hogbin had prior worked for the Ministry of Food in the Great War. In his testimony, Hogbin claimed that it was to his knowledge as he had been told that England had departed military service prior to the civil war and was unable to take up active service - a fact he had been told when the activists had discussed their past at a party meeting. Hogbin was attacked in the press, notably for having ran against one of the few SPGB MPs, Shapurji Saklatvala. Nevertheless, the jury ultimately ruled against England and his comrades, each being sentenced to 3 years imprisonment for seditious activities to undermine the republic with a second ruling to take place shortly.
England his comrades immediately sought an injunction to this second ruling and for an appeal to the first, citing that the new evidence presented and the character assessment were both faulty and breached court rules. The appeal was granted on the basis that England alleged he could prove that both the letters were fabricated and that he had evidence to disprove his service in the Royalist Army. This second point had been a contentious point of the trial as it had been based on the record that England had been interned in the immediate post-war with a reason given for enemy service. These records were noted for being unreliable and often filled in quickly and on mass - England contended that he had been interned for being a local businessman, not a soldier. Fearful that the trial could collapse, the Mann government agreed to follow the matter to the Court of Appeals with a new trial set for the 9th December. All defendants were temporarily released on remand but had to remain within London.
However, the trial took an unexpected turn when on the 7th of December it was reported that England and John Sturrock, a Scottish journalist and Constitutionalist, alongside six other less prominent defendants had disappeared and most likely fled the country. A week later, the Central Intelligence Committee reported that England and Sturrock were "alive and well" within Belfast, living off sponsorship of other wealthy exiles. Arrest warrants were made but ultimately came to naught and the remaining Constitutionalists were interned to prevent their own attempts at fleeing the country. In the ensuing trial, records were produced proving that England had been recalled to serve with the East Lancashire Divisional Train during the war. Hogbin was now under immense suspicion, particularly as the Daily Worker began to float a claim that he had once called the Liberal Party the: "only effective instrument in fighting the pernicious doctrine of socialism." The court ultimately acquitted all defendants - as all other major figures in the scandal had fled the country - aside from Hogbin and Ward. Hogbin was sentenced to two years imprisonment for committing perjury and Ward was sentenced to four years imprisonment for the lesser crime of publishing seditious communications. To the end of the trial Hogbin swore his innocence and proclaimed that he had been misled by England and that he had no intention to mislead the court. A reprieve was not granted.
Aftermath[]
The McKenna Scandal proved to be a political stain on both the Mann Ministry and the Liberal Party. While little involved in the affair and with little damage known to have taken place, Mann was nevertheless attacked in the TUC for allowing England and his confederates to escape to Ireland. This served as a major political embarrassment for the British intelligence services, which were already reeling from allowing such an affair to take place. The first of three crises to the undermine the First Mann Ministry, this is generally considered the most minor. Nevertheless, it did serve to undermine J.R. Clynes position as the Deputy Chair and caused a wave of paranoia to sweep over the nation with the possibility of Royalist infiltration now very real. Amid rising pressure. Deputy Chair Clynes was forced to produce a special report by the Central Intelligence Committee into the present security of the nation. Clynes judged that: "while currently we can ascertain the threat of a military insurgency remains tolerable, it has to be said that this government cannot be certain that there is no conspiracy among our enemies to begin the gradual infiltration of the state."
The Liberals were the most impacted and had saw their reputation - what Samuel and his colleagues had fought so hard to build - quickly scuttled by the scandal. While there was sympathy to Samuel and Clynes commented in a security report that he was under "no suspicion that Mr. Samuel has in anyway enabled nor collaborated with seditious elements of his party", hawks within the government were less convinced. Harry Pollitt remarked that: "a Liberal is but a soft Tory" and Oswald Mosley became a radical opponent of the party, repeatedly calling for it to undergo government inspection by the Central Intelligence Committee. In terms of its legislative influence, the Liberals were able to quickly replace Ward in the TUC but lost ten seats in the Provincial Parliament reducing their count from 108 to 98 as angered electors sought to punish the party. Nevertheless, two constitutionalists were rehabilitated and resat as Samuelites, the other seat securing a Liberal replacement. The Constitutionalist wing of the party was now effectively destroyed, its members scattered, allowing Samuel to secure full power at the expense of the Liberals coming under suspicion in the public consciousness.