Malik quits as scandal claims first Government victim

The Westminster expenses scandal claimed its first Government victim today when Labour MP Shahid Malik stepped down as justice minister pending an investigation.

Gordon Brown ordered Sir Philip Mawer to examine whether Mr Malik, who denies any wrongdoing, had breached the ministerial code over a reported sub £100-a-week rent deal.

The potential implications of the revelations about MPs' taxpayer-funded allowances escalated tonight when police and prosecutors said they were to discuss potential criminal inquiries.

A panel of senior Scotland Yard officers and prosecutors will meet next week to decide what action to take in response to a surge of complaints that MPs had misused parliamentary expenses.

Dewsbury MP Mr Malik insisted he had done nothing wrong and said he looked forward to being cleared by Sir Philip and returning as a minister "with my head held high".

The alleged constituency home rent deal was reported by The Daily Telegraph alongside details of the MP's £66,827 claim over three years for his second home, a London townhouse.

He staunchly defended his expenses claims, which he said were entirely within the rules and for which he had "absolutely nothing to apologise for".

Last night he said the rent arrangement was "my private business".

However Downing Street announced this morning that Mr Brown decided to act after concluding the alleged deal needed investigating by Sir Philip, the independent adviser on ministerial interests.

"In the light of these accusations that have been made against Shahid Malik and the need for them to be properly investigated, the Prime Minister has asked the independent adviser, Sir Philip Mawer, to establish the facts of the matter as a matter of urgency and advise accordingly."

Mr Malik would be expected to return to the position if cleared, he said.

In a statement Mr Malik said: "I would like to make it clear that this inquiry has nothing whatsoever to do with my expense claims but relates to an allegation regarding my rent which, if true, would breach the ministerial code.

"I am confident that there has been no such breach and look forward to the findings of the inquiry so that I can continue to serve my constituents as their MP and the country as a minister with my head held high.

"Given that an inquiry is now under way, it would be inappropriate to comment further."

The Telegraph said items covered in Mr Malik's expenses claim for his London home included £730 for a massage chair and £65 for a court summons for the non-payment of council tax.

He also tried to claim £2,600 for a home cinema system, although that was reduced to just over £1,000 by the Commons Fees Office.

He refused to return any of the money to the parliamentary authorities, but said he would donate the £1,050 he claimed for his television to worthy causes in his constituency.

The MP said his massage chair was "legitimate expenditure".

"I have absolutely nothing to apologise for. I have done nothing wrong. I have not been at the periphery of the rules. I haven't abused the rules, I have been absolutely at the core of the rules," Mr Malik said, before he stepped down.

Sir Philip is expected to report back to the premier on his probe into the alleged rent deal within days.

The panel of police and prosecutors was ordered by Metropolitan Police Commissioner Sir Paul Stephenson and Director of Public Prosecutions Keir Starmer amid fast-mounting calls for a full inquiry.

Former police chief Ray Mallon, whose zero-tolerance approach earned him the nickname Robocop, was the latest to join the clamour this afternoon.

He believes there is enough evidence for MPs to be investigated for potential breach of the Theft Act or for other crimes, such as false accounting.

It is understood some senior officers are unwilling for the force to become embroiled in another complex political inquiry.

Campaign groups have threatened to launch private prosecutions if the police will not investigate.

Elliot Morley, the former minister who was suspended from the Parliamentary Labour Party yesterday while his own expense claims were probed by a sleaze watchdog, said today he might quit as the MP for Scunthorpe over the issue.

Mr Morley, who insists a £16,000 claim over 18 months for mortgage interest on a loan that had already been paid off was an oversight, told the Scunthorpe Telegraph: "I certainly have to consider my position.

"What matters to me is the view of my local people and my local party. I need to talk this through with them. I just feel shattered really by it all."

MPs of all parties are now braced for a weekend backlash from constituents after the stream of revelations about their expenses and allowances claims.

Windows were smashed yesterday at the constituency office of Tory Bromsgrove MP Julie Kirkbride after it was revealed she and her husband, fellow Tory MP Andrew MacKay who quit as David Cameron's Commons aide yesterday, both claimed the maximum second home expenses.