Hain quits as funding row goes to police

By Katherine Baldwin and Jeremy Lovell

LONDON (Reuters) - Work and Pensions Secretary Peter Hain resigned on Thursday after electoral authorities called in the police over political donations he had failed to declare.

Hain, 57, has denied any wrongdoing despite his late declaration of donations of more than 100,000 pounds for his failed campaign last year to be elected deputy leader of the Labour Party.

"In view of the electoral commission decision today, I will be resigning to clear my name," Hain, who first came to public attention in the 1970s as an anti-apartheid campaigner, said in a statement.

Gordon Brown's office said the prime minister had accepted the resignation. Hain was replaced by Culture Secretary James Purnell, a rising Labour star. Other young faces were promoted as Brown was forced into a small reshuffle.

Police said they had received the file and that investigations would now begin.

"We have received a referral today from the Electoral Commission in connection with potential breaches of the Political Parties Elections and Referendums Act 2000 regarding donations received," a spokeswoman said.

"An investigation will now begin by detectives from the Specialist and Economic Crime Command led by Acting Commander Nigel Mawer."

Hain's resignation is a further blow to Brown's government, already reeling from the Northern Rock debacle and a wider Labour Party funding scandal.