Hain Resigns From Cabinet

Peter Hain has resigned from the Cabinet after the Electoral Commission asked the police to investigate the funding of his deputy leadership campaign.

Mr Hain, who was Work and Pensions Secretary and Welsh Secretary, announced that he would resign on Thursday, saying that he wanted to clear his name.

In his resignation letter to Prime Minister Gordon Brown, Mr Hain said: "It has been a real privilege to head both the Department for Work and Pensions and the Wales Office, and a privilege to serve as a Minister in our government since 1997."

In response, Mr Brown wrote: "I recognise that, given the circumstances and your desire to clear your name, this is the right and honourable thing to do."

Culture Secretary James Purnell is to replace Mr Hain as Work and Pensions Secretary.

The Electoral Commission's decision to refer the issue to Scotland Yard followed an inquiry into £103,000 worth of donations to Mr Hain's deputy leadership campaign, which were declared to the Commission more than four months after the contest ended.

The investigation is to be conducted by the Metropolitan Police Specialist and Economic Crime Directorate, which investigated the cash-for-honours allegations last year.

Conservative leader David Cameron said that Mr Hain's resignation was the "right decision", while Shadow Work and Pensions Secretary Chris Grayling, said the important thing now was for Mr Brown to "take rapid action to restore effective leadership to a department that has clearly been distracted by events of the last few weeks."

Liberal Democrat work and pensions spokesperson Danny Alexander said: "The transition from Blair to Brown feels increasingly like the transition from Thatcher to Major.

"We have had the return of government incompetence, economic turmoil and political sleaze."

(KMcA)