Page last updated at 18:48 GMT, Thursday, 24 January 2008

Q&A: Hain's resignation

Cabinet minister Peter Hain has resigned from his two Cabinet jobs amid controversy over donations to his Labour deputy leadership bid.

Why has Peter Hain resigned?

Mr Hain has quit as work and pensions secretary and as Wales secretary after the Electoral Commission referred the matter of donations to his Labour deputy leadership campaign to the Metropolitan Police. Mr Hain says he has quit "to clear my name". He is expected to make a Commons statement later on Thursday.

What is the row about?

Mr Hain ran to be Labour's deputy leader but came fifth out of six candidates in last year's vote. All those taking part should have told the Electoral Commission about any donations towards their campaign. Mr Hain has admitted that although he declared £77,000 on time, a further £5,000 was not declared until November - and earlier this month admitted that a further £103,000 should have been reported.

What is wrong with not reporting the donations?

Under the Political Parties, Elections and Referendums Act 2000 political donations need to be reported within 60 days of a donation being offered.

What has the commission said?

The Electoral Commission has examined details of the 17 donations reported late by Mr Hain, and carried out a "thorough review" of additional information provided during a meeting with Mr Hain. It has discussed the matter with the Metropolitan Police and Crown Prosecution Service and has now referred it to the Met "to consider whether an investigation should commence".

Are there any other questions about the donations?

Mr Hain also faces questions over the role of a little-known think-tank, the Progressive Policies Forum, in channelling donations worth more than £50,000 to his campaign. The PPF employs no staff and has not published any research since it was set up in December 2006, three months after Mr Hain announced his intention to run for the deputy leadership.

What options did the commission have?

The Electoral Commission could have found there was nothing amiss, but that was always unlikely given that Mr Hain had admitted they were not donated in time. This left it with two main sanctions - one is to highlight the failure to declare donations in time - described by some as a "slap on the wrist". The second was to refer it to the police.

Is Mr Hain facing any other problems?

Yes. It appears that Mr Hain should have registered the donations in the Register of Members' Interests. The Parliamentary Commissioner for Standards, John Lyon, has confirmed he is to launch a separate investigation into his failure to do so after a complaint by Tory MP David Davies last week. Mr Hain could face suspension from the Commons if he is found to have broken the rules on MPs' interests.

What does Mr Hain say?

He blames poor administration by his campaign team for the failure to declare the donations. He insists it is "absurd" to suggest he attempted to hide anything, as he passed on the details of the donations to the Electoral Commission himself. Mr Hain has also blamed his large workload for his oversight. He says he has stood down to clear his name.

Did Mr Hain have Gordon Brown's backing?

The prime minister told the Sun newspaper recently that Mr Hain, MP for Neath, had his support and was doing a "great job". But he added that the "matter must rest with the authorities". However the PM later prompted fresh questions about Mr Hain's future after he told ITN that Mr Hain had been guilty of an "incompetence".

Who else was involved with running Mr Hain's campaign?

Former Hain aid Phil Taylor , who ran the campaign in its earlier stages, says all donations had been declared when he was in charge. Instead he blames his successor, Steve Morgan , for failing to declare all donations. Mr Morgan denies this, claiming that he was brought in "to bring order to the chaos" left by Mr Taylor. He also says he played no role in soliciting funds from the PPF to make up for the Hain campaign's deficit. John Underwood , one of the trustees of The Progressive Policy Forum, was closely involved in the financing of Mr Hain's campaign. He says all the donors, whose names have been declared to the Electoral Commission, were happy with the financing arrangement, which he insists was "entirely permissible".

Is this linked to the Labour donations row?

Not directly, although Mr Hain said he first discovered he had failed to declare his donations properly during the furore over the discovery that a businessman had donated money to the Labour Party under his associates' names.

Who has replaced Mr Hain?

Mr Hain's two jobs have been split, with James Purnell, the former culture secretary, becoming the work and pensions secretary. Paul Murphy, who was chair of Parliament's intelligence and security minister, and also MP for Torfaen, becomes secretary of state for Wales.



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