Labour peers stripped of party whip over lobbying allegations

Three peers have stood down from their parliamentary parties pending inquiries into allegations they broke rules by offering to carry out parliamentary work for cash.

Lord Cunningham and Lord Mackenzie were suspended by Labour and the Ulster Unionist Lord Laird resigned over allegations they offered to work with undercover journalists posing as lobbyists. All three deny any wrongdoing and have referred themselves to the House of Lords commissioner for standards.

The developments, which come days after the MP Patrick Mercer resigned the Tory whip after being stung by undercover reporters, will increase pressure on the parliamentary authorities and David Cameron to introduce new rules governing lobbying.

At present, Lords rules ban peers from seeking to profit from membership of the House of Lords by offering parliamentary advice or services. But the government has shied away from pledges to introduce laws that would shine further light on the lobbying industry.

Cunningham, who was a Labour cabinet minister before he was awarded a peerage in 2005, is alleged to have offered to write directly to the prime minister to push an agenda by lobbyists who were actually undercover Sunday Times reporters.

He asked for £144,000 a year for lobbying services, according to the newspaper, and was recorded telling reporters posing as representatives of a South Korean solar energy company that he would become their advocate in Westminster.

"Knocking on doors, introductions and getting to see the people, including if necessary the ministers – this is part of the package," he allegedly said.

In response, Cunningham said he had been testing his suspicions that he was being targeted by a scam when he met the undercover reporters. "The Sunday Times story contains a highly sensationalist and misleading account of one meeting with journalists posing as business people," he said in a statement.

"I quickly became suspicious of them and the money they were offering and sought to test my suspicions during the meeting.

"What the article does not make at all clear is that I told the undercover journalists that I always stick to the rules and declare any interests.

"The article also fails to properly acknowledge the important fact that I informed them the next day that I wanted nothing more to do with them.

"That same day I notified Baroness Royall, the Labour Leader in the House of Lords, and Lord Bassam, the chief whip, of my suspicions and what had occurred. I also reported to the clerk of the parliaments and the registrar of members' interests," he said.

Mackenzie, Tony Blair's former law and order adviser, was accused of setting up a ruse that allowed him to host events for paying clients, including on the terrace. The Sunday Times said that during the sham interview the peer was asked whether he could get around parliamentary rules that stop peers from booking events related to their financial interests. Mackenzie replied by saying that it was within the rules to ask someone else to host a party if it was for charitable causes.

Defending his actions, Mackenzie told Sky's Murnaghan programme that the rules may have to be tightened up and that he would be vindicated by an investigation.

"Morally it may well look as though it's not right but to hold the function that's the only way you could do it," he said. "I thought it was all right because it was a non-profit-making function, it was to do with saving energy, so it was important.

"I have an interest in the energy field. There was a minister speaking so it was important that the function went ahead and that was the only way we could do it and it was within the rules."

He went on: "What I have done is referred it to the Lords commissioner who looks at standards in the House of Lords and he will independently have a look at what the rules are and what I've done and I'm quite convinced that I shall be vindicated.

"It's a very complex area, but I made sure I knew the rules before I went into any of this and it's an important thing to do obviously because what we don't want is parliamentarians breaking the rules. But there may well be a case for changing them."

On Sunday Labour withdrew the party whip from both peers, pending an inquiry. A Labour spokesperson said: "Lord Cunningham and Lord Mackenzie of Framwellgate have been suspended from the Labour party pending further investigation. The Labour party expects the highest standards of its representatives and believes that they have a duty to be transparent and accountable at all times."

Laird was involved in two separate stings this weekend – one by the BBC's Panorama and another by the Sunday Times.

Justine Greening, the minister for international development, said the rules of lobbying would have to be re-examined: "With the cases that have come to light over the weekend, it looks as if [the peers] may have broken the rules … But I think we also need to look at whether we can go further than that and be better and clearer about what constitutes fairer lobbying and when it goes beyond the right line," she told Murnaghan.

Douglas Alexander, the shadow foreign secretary, told the BBC's Andrew Marr Show that if rules had been broken it was for Labour's chief whip to take action and he would be encouraging her to do so.

The shadow defence secretary, Jim Murphy, said the latest claims were "a new low for British politics" and voters would rightly be "sickened".

A recall power was needed for MPs guilty of "serious financial misbehaviour that brings politics, parliament and the process into disrepute", he said.

Mercer said he was taking legal advice but had resigned the whip to save his party embarrassment, and would step down from the Commons at the next general election. He also referred himself to the parliamentary commissioner for standards.

The MPs' code of conduct prohibits paid advocacy and requires the declaration of financial interests.

The Tory MP for Monmouth, David Davies, said he was among those targeted by the Panorama sting but had refused the offer of lobbying work.

Cunningham, who was an MP for 22 years and served in Tony Blair's cabinet, said he had been testing his suspicions that he was being targeted by a scam.

"The Sunday Times story contains a highly sensationalist and misleading account of one meeting with journalists posing as business people," he said in a statement.

"I quickly became suspicious of them and the money they were offering and sought to test my suspicions during the meeting.

"What the article does not make at all clear is that I told the undercover journalists that I always stick to the rules and declare any interests.

"The article also fails to properly acknowledge the important fact that I informed them the next day that I wanted nothing more to do with them.

"That same day I notified Baroness Royall, the Labour Leader in the House of Lords and Lord Bassam, the Chief Whip, of my suspicions and what had occurred. I also reported to the Clerk of the Parliaments and the Registrar of Members Interests," he said.