A passionate man pays the price of a chaotic campaign

When Peter Hain began his campaign for Labour's deputy leadership, it felt like an anti-apartheid rally. But there was a good reason: his South African parents campaigned against apartheid, and they were the first couple to be "banned persons". As a child, his house was raided by police, and his father wasn't allowed to watch him play cricket.

It was on cricket pitches that Mr Hain achieved notoriety after his family fled South Africa when he was 16. He disrupted cricket and rugby tours of 1969 and 1970 by the all-white South African teams and became president of the Young Liberals. He was acquitted of a bank robbery, convinced he was framed by the South African security services.

Last year's glitzy campaign launch was impressive on the day but sowed the seeds of Mr Hain's downfall. He had been planning his bid for years, and had pressed the flesh at hundreds of Labour and trade union meetings. And he was determined that no expense should be spared.

At first, Mr Hain had grounds for hope. Several big unions had promised support. But his campaign never really took off. His appeal to left-of-centre opinion was eclipsed by the backbencher Jon Cruddas, who won strong union backing.

Mr Hain decided to beef up his campaign, turning to Steve Morgan, a lobbyist. His previous chief, his special adviser Phil Taylor, resigned. As Mr Hain now concedes, donations received during Mr Taylor's time were registered with the Electoral Commission within the required 30 days. After he left, they were not.

Despite outspending his rivals, Mr Hain came fifth out of six runners. To make matters worse, he ended the contest heavily in debt after Mr Morgan ran a media blitz. The hat was passed round and £103,000 was raised, half channelled through a previously unknown think-tank, the Progressive Policies Forum. Mr Hain has still not explained why. He will now to have to do so to the Metropolitan Police.

He knew his colourful career was hanging by a thread after he revealed the £103,000 figure, taking his total amount to £185,000. The scale of the late declarations, and his claim that he was too busy as a minister to keep track of them, did not endear him to the commission. He knew all along he would have to resign if his case was referred to the police, and did so immediately yesterday.

As he hung on, there was no great groundswell of support for him among Labour MPs and some cabinet colleagues did not look him in the eye when he sat on the front bench.

Some Labour MPs never forgot that he was once a Liberal. Others saw him as too ambitious, mocking the perma-tan of "Hain the Pain". He was also seen as a boat-rocker who pursued an Old Labour agenda of higher taxes on the rich while secretary of the Tribune group and later as a minister, incurring the wrath of Gordon Brown and Tony Blair.

To others, he was a breath of fresh air. He wasn't afraid to speak his mind, saying politicians should not become "automatons". A minister since 1997, the MP for Neath joined the Cabinet in 2002 as Welsh Secretary. His finest hour came as Northern Ireland Secretary, where he played a pivotal role in restoring self-government through a power-sharing executive.

Mr Hain had a Tiggerish quality to him, bouncing back from the embarrassment of the deputy leadership to land a serious job at Work and Pensions, the biggest spending department with a budget of £130bn.

When I interviewed him last month, it was clear he was revelling in the job. He was passionate about welfare-to-work, even though it involved "tough love" measures designed to force claimants, including the sick and disabled, back to work. He saw it as an anti-poverty, full-employment agenda.

He knew a huge cloud still hung over his head because of his chaotic campaign. Mr Brown hopes that Mr Hain will play a role in public life, and we haven't seen the last of him.The rebel will find new causes. But at 57, he is unlikely to return to the Cabinet.

Read Andrew Grice on the day's issues at: independent.co.uk/todayinpolitics