PM calls in adviser on ministerial interests over Lady Warsi

Inquiry follows Warsi's apology for failing to disclose business interest with relative who travelled with her on official visit

guardian.co.uk, Rajeev Syal, Monday 4 June 2012

Lady Warsi apologised for failing to disclose her shared business interest
 with a relative who travelled with her to Pakistan on an official visit.
Photograph: David Jones/PA

The political career of Lady Warsi has received another blow after she apologised to the prime minister – and was then referred to the independent adviser on ministers' interests for failing to properly declare her business interests.

Warsi, the Conservative party co-chair, wrote to David Cameron admitting that she failed to tell civil servants and the Pakistan High Commission of her shared business links with her husband's second cousin, who accompanied her on an official trip to the country.

Cameron has responded by referring her to Alex Allan, his adviser on ministers' interests. Allan has been asked to consider whether Warsi broke the ministerial code.

Warsi's apology may not be enough to stop a party-wide whispering campaign against her following a slew of allegations, including that she has claimed living expenses that she was not entitled to, and that she failed to declare rental income.

Warsi denies over-claiming expenses and said that her failure to declare rental income was "an oversight".

Cameron has until now defended Warsi. She is popular among many non-party members but has riled backbench Conservative MPs with her forthright views, and has been criticised for a perceived lack of experience.

In a letter to the prime miniser, Warsi said she was "sorry" for the embarrassment caused by the undeclared relationship with Hussain, who assisted the British High Commission with outreach events in Pakistan in July 2010. Their business relationship was disclosed in the Sunday Telegraph.

Warsi wrote that Hussain was her husband's second cousin and this fact was "widely known", including to her private office and the British High Commission.

However, she said she did not realise the need to declare that they had "a common business interest as minority shareholders in a small food company".

"I sincerely regret that I did not consider the significance of this relationship with Mr Hussain when the arrangements for the visit were being made. In retrospect, I accept that I should have made officials aware of the business relationship between Mr Hussain and myself, and for this I am sorry.

"I regret that this failure may have caused embarrassment to the government."

Cameron said he accepted her apology but was asking Allan to "consider the issues that have been raised with respect to the ministerial code and to provide advice to me as rapidly as possible".

The prime minister has faced criticism for refusing to refer Jeremy Hunt, the culture secretary, to Allan over the conduct of his special adviser Adam Smith during his dealings with Rupert Murdoch's empire over the BSkyB bid.

Labour accused Hunt of misleading parliament and said he had broken the ministerial code, which states that ministers are responsible for the conduct of their special advisers. Labour claims he should be sacked.