Andy Coulson 'not asked about severance'

Andy Coulson was not asked about his severance package from News International when he was hired as David Cameron's communications chief, it emerged tonight.

The payments - said to have continued for several months after he took up his new job and totalling hundreds of thousands of pounds - were regarded as "a private matter".

The disclosure by the Conservative Party raises fresh questions about the "due diligence" carried out before the ex-News of the World editor was employed.

However, a party spokesman denied suggestions from Labour that the payments could have constituted political "donations in kind" from News International.

Mr Coulson was hired by Mr Cameron in July 2007 on a reported salary of £275,000, six months after he quit as editor of the Sunday newspaper when its royal editor Clive Goodman and private investigator Glenn Mulcaire were jailed for phone hacking.

According to the BBC, for several months after he started his new role, the spin chief was still receiving instalments of money as full settlement of his two-year contract as editor of the now defunct tabloid.

His severance package included continued access to healthcare and a company car, the corporation said.

The Prime Minister took Mr Coulson into government with him last year, putting him on the public payroll as Downing Street director of communications.

Mr Coulson quit in January as pressure over phone hacking continued to mount. He has since been arrested on suspicion of corruption and phone hacking and released on police bail until October.

The Electoral Commission has confirmed it is considering a letter from Labour MP Tom Watson questioning whether the severance pay effectively part-funded Mr Coulson's salary.

A Conservative Party spokesman said: "Any payments made to Andy Coulson as part of his severance package with News International would not constitute donations in kind to the party as they were linked to his previous employment with NI, not with the Conservative Party."

The spokesman went on: "We were not aware until last night of allegations that Andy Coulson's severance package, agreed with News International before he was employed by the Conservative Party, was paid in instalments that continued into the time he was employed by the Conservative Party.

"Severance payments are a private matter. It is not part of the HR process to discuss severance payments from previous jobs with potential employees."

Sources confirmed Mr Coulson was not asked about his severance arrangements from News International before being hired.

Labour's culture spokesman Ivan Lewis insisted more "transparency" was needed from Mr Cameron and News International.

"The details of Mr Coulson's termination agreements with News International must be published and we need to know whether these payments, in the form of honouring a two-year contract of employment after he had been forced to resign in disgrace, were declared to the parliamentary authorities," Mr Lewis said.

"It must be explained why Mr Coulson was getting these payments when he resigned from the News of the World.

"The longer these questions are unanswered the more damage will be done to the Prime Minister's reputation."

A spokesman for News International said: "News International consistently does not comment on the financial arrangements of any individual."

PA