MPs on all sides were furious with Betty Boothroyd's ruling not to refer the allegations against Sir Jerry to an investigation by the Commons privileges committee. Some privately complained it was being "swept under the carpet" to protect the parliamentary "club".
Her ruling was seen as an attempt to draw a line under the recent spate of sleaze investigations against MPs. One senior Commons source said she was afraid it was getting out of hand.
Sir Jerry, who was in South Africa as chairman of the Commons agriculture committee when the storm broke last week, apologised to the House "without reservation for any harm" his action may have done to its reputation. In spite of Tory backbench hostility, John Major last night signalled in a letter to Tony Blair, the Labour leader, that the Government was prepared to go along with the Opposition in implementing the thrust of the Nolan report on standards in public life.
Labour is likely to drop plans for a full Commons debate on the issue tomorrow after talks last night between Tony Newton, the Leader of the House, and Ann Taylor, his Labour shadow, on setting up a Commons committee to put the Nolan report into effect.
Labour dropped its threat to boycott the committee and a leadership source said: "The Government is moving in our direction, but there is still a lot of work to be done on the terms of reference for the committee, the membership and the timetable for implementation."
Mr Major said there was opposition to the Nolan proposal for a Parliamentary Commissioner for Standards, but alternatives needed to be examined. He said the committee should consider how the Nolan recommendations might be implemented, while taking criticism into account.
The Speaker told the Commons "we cannot legislate for integrity" and warned MPs that allegations against Sir Jerry should be the "last distasteful question on which the Speaker is obliged to inquire into".
Labour MPs protested at the refusal of the Speaker, a former Labour whip, not to refer Mr Wiggin, the Tory MP for Weston-super-Mare, to the privileges committee after admitting he had tabled amendments to the Gas Bill in the name of Sebastian Coe, a fellow Tory MP, without telling him.
Sir Jerry had a declared interest, as a paid adviser to the British Holiday and Home Parks Association, covering caravan parks which would have benefited by the amendment to improve access to natural gas.
In a fulsome apology to the House, he conceded that it raised suspicions he aimed to avoid the declaration of his financial interest. "My purpose in putting the amendments down in [Mr Coe's] name was to improve their chances to be considered, since I was not in a position to move them myself in committee. There was no intention to deceive," he said.
Peter Hain, the Labour MP who led demands for the privileges committee inquiry on Sir Jerry, last night renewed the call for an investigation. In a letter to Mr Hain, the Speaker said: "You will have heard Jerry Wiggin's personal statement this afternoon. It is my view that the statement disposes of this unpleasant matter."
Justifying her decision, she said there was no dispute about the facts and it was the practice of the House to accept without further demur the bona fides and candour of an MP who made a personal statement.
Senior Tory MPs protested that the leniency shown to Sir Jerry was unfair to the two Tory MPs, Graham Riddick and David Tredinnick, who were suspended for 10 and 20 days respectively after being referred to the privileges committee over accepting cash for questions.
"It's very unfair on Riddick, who made a personal apology to the Commons, and Neil Hamilton, who still has a witchhunt against him. It strengthens the case for Nolan saying these matters should be dealt with by somebody outside," a senior Tory backbencher involved in "sleaze" inquiries said.
"The public will be outraged that Jerry Wiggin got off. He has got away with blue murder," Dennis Skinner, the Labour MP for Bolsover, said.
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