George Osborne today attempted to close down the controversy which has dogged him for the last week by admitting it was a "mistake" to have been involved in discussions over donations with a Russian billionaire.

In his first public comments for almost a week, the Shadow Chancellor admitted it “did not look very good” that he was present when a possible £50,000 donation by Oleg Deripaska was discussed with the financier Nathaniel Rothschild in Corfu.

Mr Osborne added that he would now change the way he operates in light of the saga and would no longer discuss donations with any individual, a decision which was revealed by The Times this morning.

Mr Rothschild, a university friend of the Shadow Chancellor, had sparked the controversy last week. In a letter to The Times, he accused Mr Osborne of trying to solicit a donation from Russia's richest businessman when staying at his villa in Corfu.

Yachtgate: where Osborne and Rothschild differ

Five key questions remain unresolved over allegations that Conservatives solicited a donation from Russian billionaire

• A witness with impeccable Wall Street credentials

• Drinks, dinners and differing accounts: a weekend on Corfu

• George Osborne on the rack over new donation allegations

BACKGROUND

• Oleg Deripaska - oligarch at centre of storm

• Hellraising for the rich: how Osborne met Rothschild

• Osborne's chronology and Rothschild's reply

Multimedia

• Osborne and the oligarch

Related Links

• Analysis: Osborne forced into open after silence

• Mandelson should release diary, says EU

• Osborne quits donations role

Mr Osborne has admitted meeting Mr Deripaska on his yacht but has denied asking him for any money.

He has, however, admitted that he was present when Mr Rothschild discussed the possibility of the Russian making a donation with Tory Party chief executive and fundraiser Andrew Feldman.

Their conversation included a discussion about whether Mr Deripaska could make a contribution through his British-based company, Leyland DAF. Political parties in the UK are not allowed to take money from foreign-based donors under British electoral law.

“I neither asked for money nor received any and I didn’t break any rules but I think I did make a mistake,” Mr Osborne told BBC Radio 4’s The World at One.

Adding that he would change his way of working, he said: “I think in politics it is not just what you say or what you do, it’s how things look. If I am absolutely honest this didn’t look very good and I regret that.

“I think the real judgment is can you learn from mistakes you make. I have changed the way that I am going to operate when it comes to fundraising and I will not discuss individual donations with individual donors.

“That, I think, is an appropriate thing for me to do.”

The Tories will hope that, by owning up to his mistake, Mr Osborne can finally draw a line under the controversy.

Mr Rothschild was said to have taken the decision to write to The Times after being enraged that Mr Osborne had broken the meeting's code of confidentiality and leaked to the Sunday Times details of a conversation involving Peter Mandelson, who was also present at some of the Corfu meetings.

Lord Mandelson, who was then the EU trade commissioner, has been coming under increasing pressure to explain his links with Mr Deripaska after admitting at the weekend that their contacts dated back to 2004 - two years earlier than previously acknowledged. As Mr Mandelson was the Commissioner formerly in charge of EU trade rules, Mr Deripaska's interests could have been directly affected by the discussions.

Mr Mandelson today angrily denied that he would resign over the meetings, telling the Reuters news agency: “No, that is a fantasy.”

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