Blunkett resigns from Cabinet

The Prime Minister's official spokesman said that the Work and Pensions Secretary had told Tony Blair this morning that he believed his position was "untenable".

The spokesman said Mr Blair had continued to express his "full support" for Mr Blunkett and had accepted his resignation only "reluctantly".

Mr Blunkett was forced from his job following sustained controversy over hisbusiness dealings.

The first hint that he was not going to survive the onslaught came when his appearance before a select committee of MPs was cancelled this morning.

Mr Blunkett was seen arriving in Portcullis House, part of the House of Commons, where the meeting was due to be held.

There followed farcical scenes as the minister and his entourage were pursued around the building.

At one point the minister retreated to an alcove where he was seen to have a mobile phone conversation.

He and his aides then left the Commons in his official car heading back to Downing Street.

As he left, one reporter asked him if he had resigned.

Mr Blunkett did not reply.

He was later seen entering Downing Street by the back door of No 10.

It is the second time Mr Blunkett has been forced to quit the Cabinet within a year.

He left his job as Home Secretary over the "nannygate affair" in December after his office was found to have intervened in a visa application on behalf of his then lover Kimberly Quinn's nanny.

Labour MP Clive Betts, a friend of Mr Blunkett's, admitted it was hard to see how he could return to the top of government for a third time.

"A second resignation in such a short period of time, I think, it is very difficult to see a rehabilitation in a similar way."

Only yesterday Mr Blunkett declared he would not allow his critics to drive him out of office.

The Conservatives stepped up their demands for an inquiry into Mr Blunkett's affairs following the disclosure that he had failed to consult a key Whitehall watchdog over a third business appointment.

Under the Ministerial Code of Conduct former ministers are required to consult the Advisory Committee on Business Appointments (ACBA) over any appointment they take up within two years of leaving office.

Downing Street yesterday insisted Mr Blunkett's failure to contact the committee over his role as a paid adviser to the Organisation for Research and Technology charity was a "mistake" which did not affect his ability to do his job.

However, the chairman of the Committee on Standards in Public Life, Sir Alistair Graham, said he had "undoubtedly" committed a breach in the code in failing to consult ACBA over two earlier appointments.

The latest controversy concerned Mr Blunkett's appointment while he was a backbencher as an adviser to the Organisation for Research and Technology - an international Jewish development charity also known as World ORT.

According to his entry in the April 2005 edition of the Commons Register of Members' Interests, he was paid between £15,000 and £20,000 for his work for the organisation.

However Mr Grayling, disclosed that Mr Blunkett had once again failed to consult ACBA.

It followed the disclosure that he had failed to seek ACBA's advice over appointments with DNA Bioscience, a DNA testing company, and the Indepen business consultancy - despite being told that he should by ACBA chairman Lord Mayhew.

Mr Blunkett had already announced the selling off of £15,000-worth of shares in DNA Bioscience bought on behalf of his three eldest sons after he stepped down as a director in the company following his re-appointment to the Cabinet.

Mr Grayling said that the Prime Minister could not afford to ignore the continued breaches of the Ministerial Code.

However the Prime Minister's official spokesman yesterday rejected suggestions that Mr Blunkett should face disciplinary action.

"David Blunkett has accepted he made a mistake. The question is, does that mistake stop him doing his job? The Prime Minister's judgment is that it does not."

Mr Blunkett, the MP for Sheffield Brightside, told the Sheffield Star yesterday that he had no intention of quitting.

"The pressure is not continuing. The Prime Minister has made his decision and no matter what the Conservative Party want, I am not resigning," he said.

"This is a straight political battle with the Conservative Party and their allies in the media and decency.

"I have done nothing wrong at any stage. I have been transparent about everything I have done."

But today the former chairman of the Committee on Standards in Public Life, Lord Nolan, suggested the Prime Minister should sack or demote the Work and Pensions Secretary.

In an interview with the Yorkshire Post, Lord Nolan said: "I think he's more or less admitted that he should have followed the rules. But I think it's the fault of the Government that he has been allowed to see if he can get away with it.

"Blair should insist on ministers all round obeying the rules. I think that if anyone breaks the rules, they should be disciplined. Otherwise, there's no point having the rules."

Asked by the paper if that meant Mr Blair sacking or demoting Mr Blunkett, Lord Nolan replied: "That's right."

Lord Nolan was head of the committee when the ministerial rules were introduced in the 1990s.

It is expected that Mr Blunkett will hold a valedictory press conference at the Department of Work and Pensions at around 12.30pm today.

Mr Blair's official spokesman insisted Mr Blunkett had not been sacked but had decided to quit.

The spokesman said: "The Prime Minister's full support for David remains. David Blunkett chose to resign because he had reached the conclusion that the position was untenable and that he would be unable to continue in his position."

The spokesman said he expected a replacement for Mr Blunkett as Work and Pensions Secretary to be announced later today.

He also said Mr Blunkett would explain his reasons for quitting at a news conference later today.

Mr Blair left Downing Street at 11.38am without commenting on Mr Blunkett's resignation.

He got into his Range Rover and headed for Prime Minister's Questions at the House of Commons, ignoring shouts of "Are you sorry to lose Mr Blunkett? " from the press.