Gordon Brown has apologised to Labour members for the Parliamentary expenses scandal in an attempt to head off a threatened boycott by activists upon whom the party is relying to canvass ahead of the European elections on 4 June.
Mr Brown has sent an email to all Labour members and re-assured them that tough action will be taken against any Labour MP who has defied the rules. One minister said some activists were refusing to campaign for next month's European and local elections because they felt betrayed by Labour MPs who milked the expenses system.
In his email, seen by The Independent, the Prime Minister said: "I know that people are angry about MPs' expenses. I know that you are working hard, on the doorsteps and the phones, to put Labour's message across... So I want to apologise to you on behalf of all politicians for this.
"Let's remember that the vast majority of Labour MPs are decent, honest and hard-working. Any MPs who have abused the allowances system have let down themselves, their colleagues, party members and the public." Mr Brown said that repayment "will not necessarily be enough" – a sign he is ready to stop the worst offenders standing for re-election.
His words cast further doubt on whether Hazel Blears, the Communities Secretary, will keep her post in an expected cabinet reshuffle next month. She is to pay back £13,000 after avoiding capital gains tax on the sale of her London flat. Mr Brown said yesterday she was in her post "at the moment" and that her behaviour had been "unacceptable". Downing Street insisted Mr Brown still had full confidence in her.
Ms Blears made it clear that she was determined to keep her job. "The Prime Minister said that I have acted entirely within the rules, as I have always said," she said. "But I also recognise that acting within the rules does not cut it with the public and that is why I paid the money."
Mr Brown rejected demands for an early general election so the public could decide which MPs should keep their seats. He told GMTV: "Do you really want to see tomorrow in the midst of the recession, whilst the Government is dealing with this, the chaos of an election? What you actually want is to get on with the job of sorting out the problem."
In the Commons, David Cameron accused Mr Brown of being "frightened of elections" and "hopelessly out of touch" with the public mood. When Mr Brown said the "chaos" would come from Tory spending cuts, Mr Cameron told him this was his "first admission that he thinks he is going to lose".
Mr Brown is under pressure from Labour activists worried that he was slower to crack down on errant MPs than Mr Cameron and faced criticism at a meeting of Labour's national executive committee on Tuesday.
Sixty Labour parliamentary candidates have signed five "integrity pledges" to reassure voters they would meet "high standards of integrity, transparency, accountability and financial economy" and saying they seek office "not for personal gain but to serve the public and our democracy".
Meanwhile, a by-election in the Glasgow North-East constituency of the departing House of Commons Speaker, Michael Martin, is likely to be in September, a local Labour Party chief said yesterday. Gerry Leonard, who was Mr Martin's election agent and chairman of the constituency party, admitted Labour will face a "hard fight" to hold the seat.
Shahid Malik, who has stood down as a Justice minister, insisted he had not resigned and that he had stepped aside while he cleared his name following the allegation that he paid rent under the market rate for his constituency home.
"I personally believe I have done nothing wrong," he said. "I have not resigned – that is rubbish and completely false."
Mr Brown faced calls for a wholesale reform of the political system. The Labour MP Martin Linton called for a referendum on changes to party funding, the House of Lords and voting methods.
Nick Clegg, the Liberal Democrat leader, said that in the wake of the scandal, there was a "once in a generation" chance to change British politics.
The Prime Minister said that the Government would publish plans in the next few weeks on "greater consultation between the public and Parliament and about enhancing the rights of the people in relation to the accountability of Parliament itself".
Mr Brown did not rule out a constitutional convention similar to the one which drew up the blueprint for Scottish devolution.
Resignation issue? The war of words
"What Hazel did was unacceptable. She came to me, we talked about it and she paid back the money. I am the only party leader... to have actually suspended and asked people to step down. If it became necessary to do so for other people, I will not resile from doing so."
GMTV, 7.30am, Wednesday 20 May
"Well you heard the Prime Minister's spokesperson this morning actually say the Prime Minister had full confidence in me, he thought I was doing a great job as Secretary of State, and I will be carrying on, doing exactly that, doing my job."
Talking to reporters in her Salford constituency, 12.45pm, Wednesday 20 May