'Hain, not staff, liable for donations'

Peter Hain is the most likely person to face prosecution if charges are brought after the Metropolitan Police investigation into his Labour deputy leadership campaign.

Legal sources say that Mr Hain's campaign staff could escape prosecution because, under electoral law, the candidate is personally responsible for ensuring that relevant donations are declared within 30 days.

Mr Hain resigned from the Cabinet on Thursday after the Electoral Commission referred the question of his £103,000 of donations to the police. Scotland Yard will investigate whether supporters who contributed £51,600 through a previously unknown think- tank, the Progressive Policies Forum, did so in the hope that their names would not become public. Some donors are thought to have offered to donate to the campaign at an earlier stage but to have been turned down because they wanted to remain anonymous. It is believed that the Hain team went back to them to ask for money when his campaign ended heavily in debt.

Gordon Brown denied Tory charges yesterday that he was guilty of "dithering" over Mr Hain's future. Speaking to reporters at the World Economic Forum in Davos, he insisted that he did "the right thing" by waiting for the commission to complete its investigation into the donations.

James Purnell, who succeeded Mr Hain as Work and Pensions Secretary, said he believed Mr Hain would clear his name. Paul Murphy, who took over his other post as Welsh Secretary, said: "I hope that it is not the end of the political career of Peter Hain. I think he has still got an awful lot to offer."