The Cash-for-Questions Affair: Pressure to open door on 'sleaze hearings'

PRESSURE on the Government to hold public hearings into MPs' financial links with outside interests intensified yesterday after moves to bring Neil Hamilton and Tim Smith within the scope of the 'cash-for-questions' inquiry.

John Major stuck to the conventional view on Thursday that there was no precedent for the Committee of Privileges' inquiry into the affair not being carried out in private.

But whips have conceded it would be 'much more difficult' to keep the investigation behind closed doors if it were widened to include Mr Hamilton, the corporate affairs minister, and Mr Smith, former Northern Ireland minister. Labour members of the committee have protested against the secrecy by withdrawing en bloc.

Graham Riddick, one of the Tory backbenchers due to be investigated, said yesterday: 'I believe the committee will ensure natural justice and fair play, and I therefore hope Labour members will play their part.'

One of the Labour members, Alf Morris, MP for Wythenshawe, complained that the Prime Minister had implied that the question was between complete disclosure and total secrecy.

But a motion from Mr Morris before the committee on Tuesday night had proposed that the proceedings should be in public except where there was a clear and compelling reason, such as a legal reason or a breach of natural justice, to go into camera.

Because a motion calling for complete privacy had been taken first, the compromise position had never been voted on, Mr Morris said.

David Alton, the Liberal Democrat member of the committee who has formally called for the committee to investigate the conduct of Mr Hamilton and Mr Smith, has also protested against Sir Peter Hordern, a senior Tory, continuing to sit on it once its inquiries are widened, because he was a consultant to Harrods at the relevant time.

In another twist, Peter Preston, editor of the Guardian, yesterday quoted Mohamed al-Fayed, the store's chairman, saying that Mr Smith, when deputy party chairman, had approached him for Tory party funds before the last election, thus bringing the whole affair a step closer to government.

'I showed him the door,' Mr Fayed is quoted as saying.

Calls for a different style of inquiry meanwhile continued yesterday, as Sir Norman Fowler, former Conservative Party chairman, became the latest to call for an independent committee to examine the question of MPs' outside interests. Bill Michie, Labour MP for Heeley and a member of both the Select Committee on Members' Interests and the Committee of Privileges, urged that the matter of Mr Hamilton's Ritz hotel holiday should be investigated in the first instance by the Committee of Privileges which - unless it loses credibility over the public/private row - would have significantly more authority.

The key difference between the two committees is that the powers of the Committee of Privileges are extremely wide. It has unlimited scope to recommend changes in rules of parliamentary ethics - although these must then be approved by a majority of MPs.

The remit of the Select Committee on Members' Interests - which Alex Carlile, a senior Liberal Democrat, yesterday called upon to formally examine the hotel episode - is confined to examining whether MPs have breached existing registration rules by failing to declare interests.