Lord Carlile, who often defends work of intelligence services, has earned £400,000 from consultancy formed with Sir John Scarlett in 2012

Lord Carlile, the former independent reviewer of terrorism legislation who this week mounted a spirited defence of the intelligence services, has received £400,000 from a private consultancy he co-owns with a former head of MI6.



SC Strategy Ltd, the company that Carlile established with Sir John Scarlett, who ran MI6 from 2004 to 2009, is described as offering clients strategic advice on UK policy and regulation and has paid out dividends to the pair totalling £800,000 over the past three years, according to accounts filed with Companies House.

On Monday, Carlile made a pointed intervention in the debate over the extent of powers enjoyed by the security and intelligence agencies in advance of the government’s publication of the draft investigatory powers bill on Wednesday.



Speaking on BBC Radio 4’s Today programme, Carlile called for an end to the “demonisation” of the security services. The peer also defended politicians’ powers to authorise interception warrants.

“I cannot think of any example – certainly in the period since 2001 when I’ve been intimately involved in this kind of work – in which I have seen a politician make a decision that was against the interest of the privacy of the public.”

Carlile and Scarlett’s only known client is Qatar’s sovereign wealth fund. However, the Liberal Democrat peer told the Guardian he provided confidential advice to several clients from around the world, both companies and individuals. “We are a small, reasonably successful company,” he said.

Carlile, who oversaw UK anti-terrorism laws in the wake of 9/11 until 2011, now serves as the government’s independent reviewer of national security arrangements in Northern Ireland.

Relatively little is known about SC Strategy, which Carlile and Scarlett formed in late 2012. The company – owned jointly by the two men – has no website or phone number and Companies House only lists a correspondence address for the company at a high-end City accountancy firm.

Carlile’s register of interests in the Lords describes it as providing strategic advice on UK policy and regulation.

Yet SC Strategy appears to maintain a degree of clout in Whitehall. Cabinet Office records show that on 10 April 2013 and 6 June 2014, the company had a private meeting with the cabinet secretary Sir Jeremy Heywood – widely viewed as the most influential player in David Cameron’s No 10 – and treated him to breakfast.



Carlile told the Guardian that “as I far I can recall” he had never held a conversation with Heywood, and “certainly not” since SC Strategy was formed. He added that he understood that Scarlett “has known Sir Jeremy for many years, professionally and as a friend”.

In a statement, Carlile rejected any suggestion his public support for the intelligence agencies may have been influenced by his business relationship with one of the UK’s ex-spy chiefs.

“My relations with former intelligence chiefs have at times involved criticism,” he said. “Our business relationship developed for reasons totally unconnected with Sir John having been chief of MI6.”

In recent years, Carlile has made a series of high-profile interventions in support of the security and intelligence services. In October 2013, the peer argued that publication of Edward Snowden’s revelations about mass surveillance amounted to a criminal act.

Internal documents disclosed by Snowden show GCHQ worked closely with the Home Office in 2009 over its press strategy by “lining up talking heads” such as Carlile, before a key report concerning the use of intercept evidence in court proceedings.

In January, Carlile demonstrated his support for the kind of measures expected to be unveiled by the government on Wednesday when he joined a cross-party alliance in the House of Lords that attempted to force a revised snooper’s charter into law before the general election.

Speaking to the Guardian at the time, he said: “We have taken the view that if the head of the security service and the current Metropolitan police commissioner argue that these powers are needed urgently to retain communications data due to changes in technology, then we needed to act now rather than wait for reports that we do not know when they will be completed.”

Carlile’s business partner, Scarlett, has largely remained out of public debates around privacy and surveillance. He was, however, behind a report commissioned by the former deputy prime minister Nick Clegg that concluded agencies should retain controversial powers to collect bulk communications data – one of the central concerns raised by Snowden.

Since leaving MI6, Scarlett has taken up senior advisory positions at accountant PricewaterhouseCoopers, US investment bank Morgan Stanley and Norwegian multinational oil and gas company Statoil. Scarlett is also a director and senior adviser at News Corp’s holding company for the Times and Sunday Times newspapers, and has written for the Times as an occasional columnist.

Last week the Times published a three-part series about the inner workings of GCHQ and MI6. The reports, based on unprecedented behind-the-scenes access to the agencies’ operations, appeared just a week before publication of the government’s investigatory powers bill. A spokeswoman for the Times said Scarlett was not involved in the series in any way.



The Guardian contacted Scarlett prior to publication but he was not available to comment.