Parliament’s anti-sleaze watchdog confirmed today that it has launched an inquiry into complaints made against George Osborne, the Shadow Chancellor.

The investigation by the John Lyon, the Standards Commissioner, was triggered by a complaint from Labour MPs John Mann and Kevan Jones over £500,000 in donations received by Mr Osborne.

Although the money, paid through the Conservative Party, was declared to the Electoral Commission, it was not included in his personal entry in the House of Commons Register of Members’ Interests, even though some of the donors had specified that the money should go towards the cost of running his office.

In a statement confirming the complaint had been received, Mr Lyon said: “The Parliamentary Commissioner for Standards has received a formal complaint alleging a failure by Mr George Osborne MP to record financial donations to his office in the Register of Members’ Interests.

“The Commissioner is making inquiries in respect of this complaint in accordance with the published procedures.

“He will not be making any further statement on this complaint or give reports on the progress of his inquiries. He will report as necessary on this matter to the Committee on Standards and Privileges.”

A spokeswoman at the commissioner's office would not confirm whether the investigation was in the preliminary stage, or whether a full inquiry had been launched.

However, Mr Osborne's office described it as "absolutely routine," and claimed that it was still at a preliminary stage.

“As we understand it, this is absolutely routine. The Comissioner has received a complaint from two Labour MPs and he has asked for our response. He has not launched a full inquiry," he said.

"We have ourselves asked the Standards Committee to provide clarification on the issue of whether these donations should be registered twice, having already been declared to the Electoral Commission.”

The inquiry into Mr Osborne is the latest sleaze embarrassment to hit the British political establishment.

It comes hours after Mr Lyon confirmed he is looking into complaints made against Peter Hain, who holds the Cabinet positions of both Work and Pensions Secretary and Welsh Secretary, over £103,000 donated to his failed campaign for the Labour deputy leadership, which he did not declare in the register.

Mr Osborne has claimed he consulted the House of Commons authorities about the donations he received, but the rules were unclear.

David Cameron, the Conservative leader, defended his colleague on Monday, saying: “Our chief whip had a meeting with the registrar to discuss these issues. The advice from that was unclear and taken to mean it didn’t need to be declared. We have now asked for urgent advice.

“In whatever way they want these things to be declared, we will declare them. We have absolutely nothing to hide.”

However, Mr Mann insisted that the Tories had engaged in “a classic trick” and other members of the Shadow Cabinet would be shown to have done the same thing.

“The law was specifically formulated to stop people doing this - you could put any dodgy funding you got via your party and no one would know about it,” he said.

“I believe there are more examples to come of where there has been mass under-declaring by the Conservative Party.

“These are not party donations, it’s not for Parliamentary business. This is for party political work.”

Yesterday, Mr Hain bought time in his fight for political survival when he emerged from two lengthy Commons sessions damaged but not yet finished by the donations row.

Gordon Brown gave an unequivocal vote of confidence to the Work and Pensions Secretary after two earlier attempts this week to shore him up failed to do the trick.

The Prime Minister’s remark in an ITV interview on Tuesday that Mr Hain had admitted “an incompetence” was seized upon gleefully by critics, even though Mr Brown had clearly voiced the hope and expectation that he would stay in office.

Times Recommends

• Savers left in limbo as Icesave freezes deposits
• Kennel Club changes breeding rules
• Passengers triple risk of fatal crashes