Labour peer in new cash-for-access storm

It has emerged that Lord Hoyle, a Labour peer, took money from an arms company lobbyist before introducing him to Lord Drayson, the defence minister in charge of billions of pounds of military contracts.

Paying cash for ministerial introductions is not banned in the House of Lords – but it is frowned upon.

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Last night Norman Baker, a LibDem MP who campaigns against sleaze, demanded that peers be banned from taking cash from lobbyists.

Lord Hoyle said yesterday that the financial link with Michael Wood, of the lobbying firm Whitehall Advisers, was a matter of record and denied wrongdoing.

The former Government whip declared to the Lords register of interests that he had been hired by Mr Wood as a "consultant".

The payment was for matters unconnected to Parliament, he said.

The Guardian revealed that Mr Wood agreed to pay Lord Hoyle an undisclosed sum in June 2005.

Ministry of Defence papers show the peer engineered a meeting between Mr Wood and Lord Drayson, who had recently been appointed defence minister by Tony Blair.

Mr Wood, a former RAF officer, works for BAE and other arms firms to help them win contracts.

He has access to the Houses of Parliament as he is a passholder for the Tory MP Gerald Howarth.

The MoD documents say Lord Drayson and Mr Wood met over a "cup of tea" on June 23, 2005.

Lord Hoyle said last night that he introduced the pair in the Lords bar.

But the MoD suggested the meeting had been arranged in advance, as a Private Secretary attended and notes were taken.

It refused to say whether the minister was aware of the financial link between Lord Hoyle and Mr Wood before the meeting.

Under the Lords code, a peer must specifically declare his financial interests to a minister if they have a meeting.

Asked if he had declared to the minister at the time that he was in the pay of a lobbyist, Lord Hoyle told The Guardian he "did not know".

Lord Hoyle's solicitor said the financial relationship with Mr Wood was "a matter of public record of which Lord Drayson, who is a friend and colleague of Lord Hoyle, would be fully aware".

Hew added: "Lord Hoyle and Mr Wood were enjoying a social meeting in the bar. Lord Drayson was present in the bar although he was not sat with Lord Hoyle and Mr Wood.

"Lord Hoyle introduced the two to each other on a purely social basisthe parties held only a brief conversation during which they exchanged pleasantries."

Parliamentary registrar Brendan Keith, who administers the peers' code of conduct, said: "Facilitating meetings with ministers on behalf of a company that a member is employed by is not something that I would advise."

It would "probably not violate the Lords code of conduct", he said, but added: "Were a member nevertheless to go ahead, he would certainly have to declare to the minister his interest/ relationship with the company."

The MoD said Mr Wood used the meeting to describe his lobbying company and his clients. He then used his introduction to ring Lord Drayson three days later.

Mr Baker said: "It should not be acceptable for a peer to receive money to lobby a minister. It is high time the rules of the House of Lords were tightened up."

Labour MP Paul Flynn, a member of a Commons committee which has just launched an inquiry into lobbyists, says: "To pay cash for introductions is wrong and indefensible."

The MoD said: "There is nothing to suggest that Lord Drayson acted improperly."