Labour peers face inquiry over 'cash for influence' report

Ex-ministers are accused of offering to amend bills in return for hefty payments

Four Labour peers could face a police investigation into accusations that they offered to amend proposed legislation in return for payments of up to £120,000. The House of Lords will today launch an investigation into the claims against the four, who include three former government ministers.

The allegations, which echo the cash-for-questions scandal that engulfed the Conservatives in the 1990s, will lead to renewed criticism of the lax controls over peers' business interests. The Labour leader in the Lords, Baroness Royall of Blaisdon, admitted it would be "very grim" if the allegations were proven. The Liberal Democrats will today ask Scotland Yard to investigate the claims – strongly refuted by all four peers – under anti-bribery legislation.

Undercover reporters posing as lobbyists approached 10 peers and asked for help to get a planning Bill changed on behalf of a fictitious client who hoped to open a chain of shops. Four Labour members of the House of Lords allegedly responded to the approach.

According to The Sunday Times, Lord Taylor of Blackburn negotiated an annual fee of £120,000 for trying to amend the Bill and claimed to have helped changed the law for a credit card company that he represented.

Lord Truscott of St James, a former energy minister, allegedly quoted a sum of £72,000 for a similar service. According to the newspaper, he told its reporters that he was able to influence the Energy Bill to benefit a client selling "smart" electricity meters.

Lord Moonie, a former defence minister, reportedly offered to help for an annual fee of £30,000, adding that he could identify colleagues who would table an amendment to the planning Bill. Lord Snape, a former Labour whip, allegedly quoted a sum of £24,000 and also offered find someone to amend the Bill. Offering to amend Bills in return for cash is a breach of the "no paid advocacy" rules governing conduct in the Lords. Anyone breaking the guidelines can be "named and shamed" in the chamber but cannot be suspended or expelled from Parliament.

Baroness Royall stressed there should be no rush to judge anyone and suggested the peers might have been "entrapped" by the paper.

Lord Taylor said he was approached by two people claiming to work for a lobbying company who offered to take him on as an adviser at a fee of between £5,000 to £10,000 a month. "It was their suggestion, not my suggestion. I never said I would accept it," he said, adding that no contract was signed and no money changed hands.

Lord Truscott explained that he had offered advice to the reporters so "they could lobby to make amendments". He said: "To suggest I would table an amendment for money is a lie."

Lord Moonie said: "No contract was offered and I have not had a chance to speak to the registrar about it, as I would have done had I intended to take on work of this kind."

Lord Snape said he had made clear he was unable to "initiate or amend any legislation on behalf of an individual or company". The Lords privileges committee will begin an inquiry into the accusations today, and the claims are certain to be debatedin the House this afternoon. Baroness Royall will also speak again to the the four peers.

The Liberal Democrats called for a police investigation. Chris Huhne, the party's home affairs spokesman, said: "If these allegations are confirmed, they are not merely a breach of the Lords' own rules but are surely also against the law on corrupt practices. Ex-ministers should not be touting themselves like taxi drivers for hire.

"The police should interview those who have been named and investigate whether they have used parliamentary procedures – including questions or the tabling of amendments – to further the interests of their clients.

Kenneth Clarke, the shadow Business Secretary, said if the allegations were proven, they amounted to corruption.

Under fire: Labour peers in the spotlight

LORD TRUSCOTT OF ST JAMES

Peter Truscott, 49, is a former MEP and energy minister. He was one of Tony Blair's special envoys to Russia. He became MEP for Hertfordshire in 1994 and was made a life peer in 2004. He has seven consultancies and four non-executive directorships and is an advisor to Gazprom in Russia.

LORD MOONIE OF BENNOCHIE

Lewis Moonie, 61, is a strong ally of Gordon Brown. Ennobled in 2005, Lord Moonie earns £35,000-£40,000 to lobby for Edinburgh-based Americium Developments. He is on advisory boards of Northrop Grumman IT and software company Perseus Global, and is senior advisor to Pharmathene Ltd.

LORD SNAPE OF WEDNESBURY

*Peter Snape, a 66-year-old former railwayman, is a friend of John Prescott and veteran of Labour politics in the West Midlands. He was MP for West Bromwich East for 27 years, and spent four years as a whip. He is consultant to transport company First Group, manufacturing firm Sterling Lloyd, and Halton Gill Associates.

LORD TAYLOR OF BLACKBURN

Thomas Taylor, 79, a former magistrate, was an expert on school management. He sat on the Lancaster University council for more than 30 years and was a Blackburn councillor from 1954 to 1976. He is friends with Jack Straw. He lists five consultancies, is president of Wren's Hotel group, and holds three non-executive directorships.