Grayling suggests B&Bs should be able to bar gay guests

A key Conservative has been recorded suggesting people who run bed and breakfasts in their homes should have the right to reject homosexual guests.

But shadow home secretary Chris Grayling said hotels should not be allowed to discriminate in that way.

Labour and the Lib Dems said the Tories would allow discrimination "to thrive".

Mr Grayling later said he was looking at being "sensitive to the genuinely held principles of faith groups" but was not seeking a change in the law.

The secret recording has been published on the Observer newspaper's website.

The BBC's political correspondent Norman Smith said the stance taken by Mr Grayling, MP for Epsom and Ewell, "put him at odds with the law".

'Right to decide'

Mr Grayling, MP for Epsom and Ewell, made his comments after a speech at the Centre for Policy Studies in London on Wednesday.

He was at the think tank to talk on the subject of "A Conservative Home Office."

During the recording, Mr Grayling is heard responding to a question from the audience about civil liberties.

I made comments which reflected my view that we must be sensitive to the genuinely held principles of faith groups in this country Chris Grayling

He said: "I think we need to allow people to have their own consciences.

"I personally always took the view that... if you look at the case of 'Should a Christian hotel owner have the right to exclude a gay couple from their hotel?'

"I took the view that if it's a question of somebody who's doing a B&B in their own home, that individual should have the right to decide who does and who doesn't come into their own home.

"If they are running a hotel on the High Street, I really don't think that it is right in this day and age that a gay couple should walk into a hotel and be turned away because they are a gay couple, and I think that is where the dividing line comes."

'Awkward and embarrassing'

Under the Equality Act (Sexual Orientation) Regulations 2007 no-one should be refused goods or services on the grounds of their sexuality.

However in March, Cambridgeshire gay couple Michael Black and John Morgan were turned away from a guest house in Berkshire because the owner said it was against her policy to accommodate same-sex couples.

Mr Black told the BBC that it "wasn't just a question of feeling angry on our own behalf.

"It was the fact that [it] was an example of illegal discrimination. It happened to be against a gay couple, it could be against people because they're Muslim, or black, or for any other reason."

I don't think anyone, including the Tories, wants to go back to the days where there is a sign outside saying: 'No gays, no blacks, no Irish' Ben Summerskill Stonewall

The BBC's Norman Smith said it was "awkward and embarrassing" for the shadow home secretary, who would have to enforce equality legislation should the Conservatives win the election.

In a statement, Mr Grayling said: "Any suggestion that I am against gay rights is wholly wrong - it is a matter of record that I voted for civil partnerships.

"I also voted in favour of the legislation that prohibited bed and breakfast owners from discriminating against gay people.

"However, this is a difficult area and on Wednesday I made comments which reflected my view that we must be sensitive to the genuinely held principles of faith groups in this country.

"But the law is now clear on this issue, I am happy with it and would not wish to see it changed."

'Private views'

Ben Summerskill, chief executive of the gay rights group Stonewall, told the BBC he was "deeply saddened" by the comments, which would give voters "pause for thought".

He said people were not forced to open their homes as commercial premises and they should abide by the law.

John Morgan and Michael Black criticised Chris Grayling's comments

"I don't think anyone, including the Tories, wants to go back to the days where there is a sign outside saying: 'No gays, no blacks, no Irish'," he said.

What was more worrying, he added, was that Mr Grayling said these sorts of things in private but not in public.

Conservative leader David Cameron has apologised for Section 28 - the controversial law brought in by his party in 1988 banning local authorities from portraying homosexuality in a positive light.

And in February, openly gay Tory frontbencher Nick Herbert said there had been a "self-evident" change in his party's attitude to gay people.

But the culture secretary Ben Bradshaw, who is openly gay, told the BBC: "Not only is this displaying the fact that the Conservatives have not really changed on this and many other issues, but here you have the shadow home secretary advocating that people break the law."

Chris Huhne, the Liberal Democrat home affairs spokesman, said "Chris Grayling's plan would allow discrimination to thrive".