Margaret Hodge, the minister for Children, faced fresh calls for her resignation last night after a sex abuse victim threatened to sue her for libel.
Mrs Hodge had described Demetrious Panton as "extremely disturbed" in a letter to the BBC. The letter was complaining about inquiries by the BBC into a child abuse scandal in Islington, north London, where she was council leader in the 1980s and early 1990s.
Mr Panton had spoken to Radio 4's Today programme about the abuse he suffered in the late 1970s by the head of his children's home.
Downing Street refused to be drawn yesterday as to whether the taxpayer would foot the legal bill for any defence Mrs Hodge had to undertake in connection with her job as a minister. Tony Blair's spokesman said she had the full confidence of the Prime Minister. "Mrs Hodge remains a member of the Government," he said.
But Tim Yeo, the shadow Health and Education Secretary, said the minister's attempt to "smear" Mr Panton and gag the BBC had made her position "untenable".
Mrs Hodge wrote to Gavyn Davies, the BBC chairman, complaining of a "concerted campaign" against her. She described Mr Panton as "an extremely disturbed person who suffered from child abuse in Islington homes in his youth in the 1960s, 20 years before I became leader of the council".
Mr Panton, 35, now a consultant advising the Office of the Deputy Prime Minister, said that he was ready to sue. "Margaret Hodge has defamed me as a human being and as a professional. I have never been sectioned under any mental health legislation. I have never been to my doctors for clinical depression," he said. "I have no convictions, and I do not have a criminal record."
Mr Panton's lawyer, Korieh Duodu, of the libel specialists David Price Solicitors, wrote to the minister to seek an explanation for her description. "Our client believes that Mrs Hodge's allegation was made with the intention of impugning his credibility in the eyes of the BBC and beyond. We have also asked Mrs Hodge whether she intends to repeat the allegation," he said.
Mrs Hodge insists that the letter to Mr Davies was private, although her decision to send copies to Greg Dyke, the director general of the BBC, and others may open her to the charge that she published the remark.
Yesterday, she shrugged off questions about the affair at a truncated appearance at a Westminster news conference on league tables for social services departments.
But Mr Yeo compared Mrs Hodge's complaint with the Government's row with the BBC over David Kelly, the weapons inspector. "It is disappointing that Margaret Hodge saw fit to try to gag the BBC when similar action in the past has had such terrible repercussions. Her position is now untenable and it's time for her to go."
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