Opening debate on the findings of the Neill Committee on Standards in Public Life, the Home Secretary said this was not the "clearest section" of the report. Mr Straw went on to stress that in some cases the Government would want to make sure not only that the issue was properly understood but that the Government's position was clear.
He made clear that in some cases, such as the referendum on Britain's entry into the single currency, ministers would need to continue to have access to official advice during the campaign. But he broadly welcomed the other findings of the report, published last month, which recommended an end to foreign donations and full public disclosure of donations of pounds 5,000 or more to political parties, as well as a pounds 20m cap on the amount each party can spend on a general election campaign.
Putting pressure on the Tories to publish a list of their main donors, the Home Secretary said that "public confidence into party funding reached its lowest point" in the years of the John Major government.
In his speech, the shadow Home Secretary, Sir Norman Fowler, insisted that his party's principal donors would be listed in the annual accounts, which will be published in the "next few weeks".
The Tories spent pounds 28m on last year's general election campaign and Labour pounds 26m.
Accepting the findings of the report, Sir Norman stressed there should be "no question of cherry-picking" its recommendations. He also said it was "vital" that the referendum rules were fair to both main political parties.
Intervening, the Tory Euro-sceptic Bill Cash (MP for Stone) questioned the appropriateness of taxpayers' money being pumped into what he said was a propaganda exercise to promote the euro, ahead of the Neill Committee's recommendations being implemented.
Robert Maclennan, for the Liberal Democrats, said the report did "not go as far as we would have done". He added: "It's a significant advance in the attempt to control ... the public perception that the political process was up for grabs."
Martin Linton, the Labour MP for Battersea, said large donations by "undisclosed sources" were "a cancer" affecting the political system.
Martin Bell, independent MP for Tatton, demanded the resignation of the Tory former foreign secretary Lord Pym from a committee scrutinising peerages over what he claimed was a "corruption" of political life.
He said Lord Pym should step down if he really believed, as quoted in the Neill report on party funding, that donations to political parties were a "bonus point" in deciding whether someone would be given an honour.
Mr Bell said: "This seems to me to be a corruption of the language as well as to be a corruption of the politics."