Video: Peter Hain's resignation statement

Profile of a rebel

An emotional Peter Hain declared today that he "severely and seriously" regretted failing to declare £103,000 in donations to his campaign for the deputy leadership of the Labour Party, as he announced his resignation from the Cabinet to clear his name.

Giving a statement outside his old department, the former Work and Pensions Secretary told reporters that he felt he had been left with "no alternative" but to quit after police launched an investigation into whether he broke electoral law.

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The Hain resignation does leave some senior Labour figures feeling rather uncomfortable

Philip Webster, Political Editor of The Times

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• Peter Hain: profile of a rebel

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• Comment: Sam Coates on the Red Box blog

• Pictures: Peter Hain resigns

• Video: Peter Hain's resignation statement

Mr Hain, who was also Secretary of State for Wales, continued to claim that the failure to declare the money, which was revealed earlier this month, was an administrative oversight which he regretted, and said he was resigning to "clear my name" against sleaze allegations.

In a dramatic day at Westminster, it is understood that Mr Hain phoned the Prime Minister at around 11.30am and informed him he had been told by the Electoral Commission of the impending police investigation. At that point, it is understood that he offered his resignation without hesitation, a decision which was accepted by Gordon Brown.

Immediately after the Commission officially announced its referral at 12.20pm, Mr Hain released a one-line statement saying that he would resign.

At 2pm, the MP – who made his name in politics as an anti-apartheid campaigner and is still considered the most left-wing member of Mr Brown's Cabinet – took to the steps of the Department for Work and Pensions to formally announce his decision.

Within two hours, he had been replaced as Work and Pensions Secretary by 37-year-old James Purnell, formerly the Culture Secretary, who only became an MP in 2001 and is considered one of Labour's rising political stars.

Mr Purnell’s appointment made way for a Cabinet reshuffle this afternoon that saw another three young Labour MPs given promotions.

Andy Burnham became the new Culture Secretary and was replaced as Chief Secretary to the Treasury by Yvette Cooper. Ms Cooper will now assume a full Cabinet role for the first time with Caroline Flint taking over from her as Housing Minister.

Wearing a black suit with purple and pink striped tie, Mr Hain told the press gathered outside the Department for Work and Pensions: "In view of the decision of the Electoral Commission today I have come to the conclusion that I have no alternative but to resign as Secretary of State for Work and Pensions and Secretary of State for Wales, and I have now done so."

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