Critics demand answers from Hain

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Attention is focused on a mysterious think tank called the Public Policies Forum (PPF), which channelled tens of thousands of pounds of donations, which the Neath MP then failed to declare to the Electoral Commission on time.

On Saturday the Work and Pensions Secretary issued a statement asserting that "all those who contributed are people and organisations who are eligible and legally entitled to do so".

Mr Hain has vowed to get on with his job, dismissing accusations that he tried to cover up donations to his campaign as "absurd". But opposition parties insist he is not yet in the clear.

The minister is still to discover the outcome of two separate investigations by the Electoral Commission and the Parliamentary Commissioner for Standards, John Lyon.

Scottish National Party MP Angus MacNeil drew comparisons with the Labour proxy donations scandal, in which North East property developer David Abrahams used third parties to disguise his own identity. Referring also to the Scottish Labour leader Wendy Alexander's acceptance of an illegal donation from a foreign businessman, Mr MacNeil said the Labour Party felt it was "above the law".

He continued: "Peter Hain's statement raises more questions than it answers - he cannot seriously believe that his position remains tenable."

The Tories stated Mr Hain had not yet provided a "proper explanation" of the issues. Shadow work and pensions secretary Chris Grayling said: "Peter Hain's statement leaves many important questions unanswered. Unless and until he can provide a proper explanation of these issues his future will remain in real doubt."

Liberal Democrat leader Nick Clegg said he would not call for Mr Hain's resignation until the findings of inquiries by the Electoral Commission and Parliamentary Commissioner for Standards were known. On the PPF, he said: "From the few facts that I have been able to gather, I can't really tell whether it's an example of extraordinary incompetence in the way he has run his leadership campaign, or deliberate obfuscation."

The donations from the think tank the Public Policies Forum (PPF) were among 17, totalling £103,000, which emerged only this week after Mr Hain failed to report them to the Electoral Commission on time.