Arrest made in loans for honours row

Police investigating the so-called loans for peerages affair have arrested a man under a 1925 law banning the sale of honours.

The specialist crime directorate has today arrested a 60-year-old man in Redbridge for an offence under the Honours (Prevention of Abuses) Act.

Reports suggest the man is Des Smith, a head teacher and a former advisor to Tony Blair's flagship city academy scheme, although there is no official confirmation of this.

This is the first arrest to arise from the police investigation into allegations that political parties have offered seats in the upper House in return for large donations or loans, which was prompted by complaints by the Scottish National party (SNP) and Plaid Cymru.

It shows the seriousness of the probe, which some have dismissed as politically motivated, and today SNP MP Angus MacNeil welcomed the arrest as "the beginning of a clean up of politics at Westminster".

"Corruption has no place in politics in any advanced western democracy. Whether its loans or peerages being offered, the prize should never be a seat in the legislative body," he said.

Plaid parliamentary leader Elfyn Llwyd added: "Today's arrest not only shows the severity of the scandal and how seriously the Metropolitan police are taking the issue, but also shows there must be evidence of wrongdoing."

Scotland Yard was initially only looking into claims that Labour had handed out peerages in return for loans, but it has since widened this investigation to include all political parties.

Both Labour and the Conservatives deny any wrongdoing and have now published the names of all the people who lent them money for last year's general election campaign.

However, the probe has prompted a parliamentary investigation into the honours process, an inquiry by the Electoral Commission and has kick-started the debate about House of Lords reform, which had been on the backburner for the past few years.

The Honours Act was introduced in 1925 after it emerged that then Liberal prime minister David Lloyd George had been selling peerages to party donors. Anyone found to have sold noble titles or accepted them for cash under the act could face a prison term.