Hain donations 'did not break code'

Cabinet Secretary Sir Gus O'Donnell has said he is "satisfied" that none of the donations received by Mr Hain during the deputy Labour leadership campaign conflicted with his ministerial duties.

Sir Gus is understood to have relayed his opinion in a letter responding to a complaint by a Liberal Democrat MP.

However, Mr Hain's donations blunders are still being investigated by the Electoral Commission and Parliament's Standards Commissioner, and he also faces the possibility of a police probe.

Questions had been raised over Mr Hain's ministerial conduct because he endorsed a loan firm and a construction company that were, unknown to the public, bankrolling his campaign.

He also failed to declare cash from the GMB which was received while he was deciding the future of Remploy factories that provide jobs for disabled people - an issue the trade union had been campaigning on.

Mr Hain has insisted that he discussed all the donations with his permanent secretary at the Department for Work and Pensions, Sir Leigh Lewis, and been assured there were no conflicts.

A source at the Cabinet Office said Sir Gus had now looked into the matter.

"Leigh was satisfied he saw no conflicts, and Gus agreed," they added.