Wednesday, December 23, 1998 Published at 12:42 GMT
Peter Mandelson: The architect of New Labour has resigned
Trade Secretary Peter Mandelson has resigned after it emerged he borrowed £373,000 from Paymaster General Geoffrey Robinson.
"I should, having done so, have told you and other colleagues whose advice I value and I should have told my permanent secretary on learning of the inquiry into Geoffrey Robinson, although I entirely stood aside from this."
Mr Mandelson used the loan to buy a house in London's fashionable Notting Hill two years ago.
Mr Robinson is expected to resign when he makes a statement on the affair later on Wednesday.
It is understood Mr Mandelson made the decision to quit after a telephone conversation with the prime minister.
Conservative leader William Hague insisted the prime minister should have fired Mr Mandelson and ought to do the same with Mr Robinson.
"It these people were on my frontbench I would have sacked them," he said.
The low-interest loan had been kept secret from the prime minister and key officials for two years until last week.
Mr Hague had previously written to Mr Blair, saying Mr Mandelson was clearly in breach of the parliamentary rules on conflict of interest.
On Tuesday, Mr Mandelson repeatedly stated he had done nothing wrong and there was no conflict of interest.
The Financial Times says the Britannia requires details of other loans on the security of a property.
The paper said Mr Mandelson issued a statement saying he could not "recall details of an application form filled in two years ago" although he was sure "he would have sought to answer the question properly".
Some Labour MPs had also questioned Mr Mandelson's conduct.
Mr Mandelson is the fourth minister in Mr Blair's government to resign - after Malcolm Chisholm, Ron Davies and Frank Field.
The former-minister is one of the architects of new Labour and a close personal friend of Mr Blair.
He is known as the party's arch spin doctor, boosted by his spell as the minister without portfolio before his promotion to the DTI in the summer reshuffle.
Was Peter Mandelson right to go? Tell us what you think. Click here
UK Politics Contents
A-Z of Parliament