Passport inquiry clears Mandelson

Peter Mandelson and Europe Minister Keith Vaz have been cleared of wrongdoing by the Hammond inquiry into the Hinduja passport affair.

The inquiry into the circumstances that led to Mr Mandelson's resignation in January accepted that he had not deliberately lied about making a call to a Home Office minister.

Secondly it found there was no connection between the Hindujas' donation to the Dome and their successful applications for citizenship.

Peter Mandelson has said he is relieved by the findings in the report. But he said he had no desire to return to government.

Sir Anthony's report establishes that I did not lie, did not deceive and did not set out to mislead

Peter Mandelson

Sir Anthony Hammond ruled it was "likely" that Mr Mandelson telephoned Home Office Minister Mike O'Brien personally about Srichand Hinduja's application for British citizenship.

Sir Anthony said: "Mr Mandelson's belief that he had not had a telephone conversation with Mr O'Brien was honestly held."

The high flying QC spent more than a month investigating the issuing of passports to the wealthy Asian businessmen who are currently facing corruption allegations in India.

Sir Anthony's report also concluded that Europe Minister Keith Vaz had not had an "improper relationship" in respect of his connections with the Hindujas.

'I did not lie'

Speaking shortly after the report's publication Mr Mandelson said: "Sir Anthony's report establishes that I did not lie, did not deceive and did not set out to mislead."

He added: "For reasons I am sure you will understand I do not desire to return to government. There are more ways to serve New Labour and to fulfill our ambitions of the country and that is what I intend to do."

Hammond's findings

Hinduja passport application "properly" handled

No improper pressure by any minister

Enquiries on behalf of Prakash Hinduja properly handled

No evidence of improper relationship between Keith Vaz and the Hindujas

Report accepts Mr Mandelson's belief that he had not approached Mr O'Brien was "honestly held"

The phonecall probably did take place

Intelligence material about the Hindujas was not drawn to the attention of the Home Office

Tony Blair commented: "I said to people right at the beginning that this was a tragic case and I said I believed Peter would be cleared of any impropriety.

"I am very pleased for his sake he has been, and I hope he will be able to get on with rebuilding his life."

A Downing Street spokesman said: "The PM regards Peter Mandelson as a friend and somebody of ability and integrity."

The report said there was no connection between his relationship with the Hindujas when he was in charge of the Dome and their subsequent passport application.

Mr Mandelson's resignation rocked the government and was a huge personal blow to Tony Blair who regarded him as one of his closest allies.

While Sir Anthony accepted that Mr Mandelson had not lied he also indicated that he believed the account of Mr O'Brien who said that the phonecall had taken place.

The billionaire Hinduja brothers had first come into contact with Mr Mandelson when he was the Cabinet Office minister responsible for the Millennium Dome.

They had offered to underwrite the faith zone at the troubled Dome to the tune of £1m.

Mr Vaz will be relieved about the inquiry's conclusions

Subsequently they approached Mr Mandelson about their passport application and he is said to have phoned Mr O'Brien.

When Mr Mandelson stepped down as Northern Ireland secretary it was his second resignation from the government.

Previously he had quit as trade secretary after it emerged that he had borrowed a substantial sum from the then paymaster general, Geoffrey Robinson, to buy a house in London's Notting Hill.

Mr Vaz became embroiled in the passports saga after he was alleged to have written to both Tony Blair and Mr Mandelson about the passport application of the Indian billionaires in 1997.

Mr Vaz said on Friday that he was "delighted" with the report's conclusions.

"It's a thorough report and one that goes into the substance extremely well," he said.