Labour challenged over Enron links

Enron is said to have given financial backing to Labour

An investigation into the British Government's relationship with failed American energy company Enron has been demanded by the Conservatives and Liberal Democrats.

Until now the focus of inquiries into alleged financial irregularities at the corporation and claims of links with politicians has been in the US.

But the Tories and Lib Dems now want allegations that Enron persuaded Labour to change its policy on gas-fired power stations by offering financial support examined.

Labour has dismissed any suggestion that it has done anything improper.

Fundraising

The investigation demanded would look at suggestions that Enron had access to British ministers after it made financial contributions to Labour by buying tickets to fundraising dinners.

It would make virtually impossible to have confidential conversations with anybody

Dick Cheney

It is claimed further influence was bought by sponsoring receptions at Labour Party conferences.

There is nothing unusual in large companies offering such support, but it is claimed Enron's backing may have won it favourable changes in government policy.

It is suggested the decisions were made after ministers met Enron executives.

The Conservatives and Lib Dems also want the government's relationship with Enron accountants Arthur Andersen investigated.

Investigators

On Sunday US Vice President Dick Cheney said he would not provide investigators with a list of the business leaders he met while forming energy policy.

They are believed to include several Enron executives, who may have influenced the administration's policy-making.

Mr Cheney told Fox News "it would make virtually impossible to have confidential conversations with anybody" if he gave out a list.

The Enron collapse, which was the biggest corporate collapse in US history, threatens to reach right to the heart of the country's government, because of the its close links with the Bush administration.

A criminal investigation and almost a dozen congressional inquiries are under way following accusations of accounting irregularities.