The Commons anti-sleaze watchdog will rebuke Bowen Wells, a long-serving MP and chairman of a Commons select committee, for failing to declare publicly his payments from Mr Ashcroft when he spoke in Commons committee debates.
The timing of today's report could hardly be worse for Mr Hague, as it will fuel the controversy over revelations yesterday that Mr Ashcroft has transferred pounds 666,500 to the Tories from his Belize Bank Trust Company since the summer.
Some Tory MPs, already critical of Mr Hague's handling of the Jeffrey Archer affair, questioned his decision to blame the Ashcroft disclosures on a Labour "dirty tricks" operation. The MPs fear this merely fuelled the latest row over "Tory sleaze".
The Prime Minister, Tony Blair, dismissed Tory claims of a Watergate- style operation to gain bank account details as "hysterical ranting". Mo Mowlam, the Minister for the Cabinet Office, said there was "not one shred of evidence" to support the allegations of a Labour plot and demanded an apology.
After a four-month investigation, the Commons Standards and Privileges Committee will rule today that Mr Wells, whose business relationship with Mr Ashcroft goes back to the mid-1980s, was "unwise" not to mention his directorship of BHI Corporation, the holding company for Belize Bank, during meetings of the International Development Committee, which Mr Wells chairs.
No further disciplinary action will be taken against Mr Wells, who listed his post in the Register of Members' Interests. But the report will prolong the latest round of publicity about Mr Ashcroft's affairs.
The investigation by the Parliamentary Commissioner for Standards, Elizabeth Filkin, is the first official inquiry into his business affairs since he became Tory party treasurer last year.
It is not known how much Mr Wells was paid, but he is believed to have received substantial sums during a total of 10 years on Mr Ashcroft's payroll.
Two Labour MPs, Denis MacShane and Alan Whitehead, made official complaints to Ms Filkin, arguing that Mr Wells's relationship with Mr Ashcroft had led to a conflict of interest.
Mr Whitehead detailed how Mr Wells promoted the cause of Caribbean banana growers including Belize in the discussions of the International Development Committee. At the time, Mr Whitehead said, the Belize growers had substantial outstanding loans from Mr Ashcroft's Belize Bank.
Questioning witnesses to the committee from the banana growers, Fyffes, in February 1998, Mr Wells argued that they could not afford to diversify into other crops if they were harmed by new trade laws.
In "anything that the Windward Islands and Jamaica, and indeed Belize, would like to diversify there are many competitors with many more advantages," he said. The growers' representative replied: "We wholeheartedly agree with you, Sir." Mr Wells then told him: "I do not wish to lead witnesses!"
Mr Whitehead argued that Mr Wells should at the very least have told the committee of his interest, and should possibly have withdrawn from the discussion.
Although he will be criticised for his failure to make such a verbal declaration, an accusation that he went further and broke the strict rule which forbids paid advocacy will be rejected.
Mr Wells held a consultancy post and then a directorship with Mr Ashcroft between 1987 and 1994, but resigned on becoming a government whip. After the 1997 election, he took up a non-executive directorship with BHI Corporation, but he resigned in July 1998 to avoid "any appearance of a conflict".
Although most International Development Committee members are likely to continue to support Mr Wells' chairmanship, some Labour MPs called for his resignation last night. A senior Labour source said: "It is an indication of the extent of Mr Ashcroft's stranglehold on Conservative politics that an MP who has wide parliamentary respect was sucked into this."
Conservatives in crisis,
Leading article; Donald Macintyre, Review, page 3Reuse content