Vaz cleared on payments, but still under heavy criticism

The embattled Europe Minister, Mr Keith Vaz, was cleared yesterday of allegations that he received undeclared payments

The embattled Europe Minister, Mr Keith Vaz, was cleared yesterday of allegations that he received undeclared payments. But he was criticised for failing to reveal a "financial relationship" when recommending a peerage. The Labour MP declared he was "absolutely delighted" the Commons Standards and Privileges Committee did not uphold allegations of financial impropriety.

But the Commissioner for Standards, Ms Elizabeth Filkin, criticised Mr Vaz for failing to reveal his dealings with a solicitor, Mr Sarosh Zaiwalla, when he put his name forward for a peerage while an opposition MP. Mr Zaiwalla had donated £250 to Mr Vaz's constituency office and paid £200 for an advertisement in a political calendar. Both payments "created a financial relationship", but because they were small enough not to have warranted a mention in the register of members' interests Mr Vaz escaped formal censure.

The committee also criticised Mr Vaz for refusing to answer questions fully and eight complaints were not investigated properly: "We consider that in this respect Mr Vaz's behaviour was not in accordance with his duty of accountability under the Code of Conduct."

However, Mr Vaz criticised the committee's investigation procedures, saying they gave "too much latitude to the purveyors of lies and malice."

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Allegations that Mr Vaz solicited and received more than £2,000 from businessmen in his Leicester constituency surfaced last year. But the committee was unable to find "firm corroborating evidence" that Mr Zaiwalla regularly made payments to Mr Vaz. And it did not uphold a complaint of wrongdoing over payments in connection with a Leicester businessman, who had alleged and then retracted a statement claiming he handed over money in return for help with planning applications.

The Conservative campaigns unit chairman, Mr John Redwood, said if Labour wanted to be taken seriously on sleaze it must "sharpen up its act".

As the Foreign Secretary, Mr Robin Cook, again denied he had not lied to MPs about his knowledge of a report into the arms-to-Sierra Leone affair, the Conservatives applied further pressure over a donation from a Syrian arms broker to a business school in Oxford.