Mr Blunkett pictured with Mrs Quinn at a function last year
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Home Secretary David Blunkett has asked for an independent review of claims he intervened in a visa application for his ex-lover's former nanny.
He has denied any wrongdoing and Tony Blair said he had "full confidence" in his home secretary.
Immigration minister Des Browne said Mr Blunkett had "nothing to fear" as there had been "no impropriety".
The Conservatives had demanded a judicial inquiry into the claims, made in the Sunday Telegraph newspaper.
On Sunday Mr Blunkett asked Home Office permanent secretary John Gieve to appoint a person on Monday to examine the papers and the handling of the case.
Trust and plain-speaking
The newspaper printed claims made in an e-mail by Mr Blunkett's former lover, Kimberly Quinn, that Mr Blunkett used his position to help her Filipina nanny, Leoncia Casalme, get permanent residency.
Ms Casalme left Mrs Quinn's employment two months ago.
"Trust, plain-speaking and straight talking is something which matters so much to me as a politician and as a man that I have decided, of my own volition, to request an independent review of the allegations that I misused my position," Mr Blunkett said in a statement.
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I regret the time and resources needed to undertake this, but...I believe that on this specific occasion, it is right to lay this accusation to rest
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"I regret the time and resources needed to undertake this, but in the light of the flagrant attempt to link my public position with the deeply personal circumstances of my private life, I believe that on this specific occasion, it is right to lay this accusation to rest," he added.
Shadow home secretary David Davis welcomed the announcement.
He said: "It is the right decision. But it must be independent of the Home Office, probably a judge, who should have proper rights of access to papers and individuals. And it should report within a short time."
Rallying round
Earlier Labour colleagues rallied round to support Mr Blunkett after claims he fast-tracked the visa application.
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It is the right decision. But it must be independent of the Home Office, probably a judge, who should have proper rights of access to papers and individuals.
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Mr Blunkett's spokesman earlier said the home secretary had checked the application form but denied it had been processed by his office.
Mr Browne told Sky News on Sunday: "All the allegations in the papers this morning, David has responded to quite candidly and straightforwardly.
"I know David Blunkett very well. He is an honest, straightforward man. Whatever inquiries or investigations there need to be in relation to this, he will co-operate fully with."
Commons Leader Peter Hain said the home secretary was "one of the straightest people in politics" and should be believed when he denied the allegations.
Kimberly Quinn reportedly made the claims in an e-mail
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He told ITV's Jonathan Dimbleby programme: "He has always been absolutely straight with everybody, whether it's on policy terms - telling people the truth about threats from crime or whatever it might be - and the same applies in this situation."
"As far as we are concerned that is the end of the story because he has answered all of the points that have been made."
He said MPs dealt with visa applications "all the time" in accordance with the law.
He added: "The home secretary, as it's his own department, would have behaved absolutely impeccably, with absolute integrity in all this... and I'm sure this will eventually be confirmed."
Security information
As well as the visa claims, the Sunday Telegraph said Mr Blunkett, 57, shared confidential security information with Mrs Quinn.
This included telling her parents to avoid Newark Airport near New York hours before a security scare.
Other claims include giving Mrs Quinn, 43, a first-class train ticket which had been assigned to him.
Mr Blunkett's spokesman said information about the New York security scare was already in the public domain.
He said the train ticket was for MPs' spouses and Mr Blunkett and Mrs Quinn were in a "close relationship" at the time.
Liberal Democrat home affairs spokesman Mark Oaten said his party accepted Mr Blunkett's denial of wrong doing.