John Prescott has admitted for the first time that his trip to the ranch of the billionaire owner of the Millennium Dome did break ministerial rules, raising fresh demands for a further investigation into his conduct.

The Parliamentary watchdog, the Committee on Standards and Privileges, report was released this morning, said that in its conversations with the Deputy Prime Minister, Mr Prescott had accepted the breach.

Sir Philip Mawer, the Parliamentary Commissioner for Standards, launched an investigation after Hugo Swire, the Shadow Culture Secretary, complained that Mr Prescott had failed to declare a two-night stay at Philip Anschutz's Colorado ranch in the Register of Members Interests. Mr Anschutz wants a licence for Britain's first super-casino at the Millennium Dome.

The committee accepted Sir Philip's report following a 90-minute meeting yesterday.

"We share the Commissioner [Sir Philip Mawer]'s view, which Mr Prescott came to accept in the light of further advice following Mr Swire's approach to him, that the nature of his relationship with Mr Anschutz meant that he was accepting hospitality from a source that might reasonably have been thought to influence Ministerial action, the key test for recording hospitality received in a Ministerial capacity in the Register of Members' Interests," the report said.

The Committee, which acts as a disciplinary panel for MPs and cannot take action over breaches of the ministerial rules, said that their body would not take be taking any action because Mr Prescott was not found to have breached the rules on registration.

Sir Philip found that Mr Prescott did not need to register the gifts with Parliament because he had done so with the department. Sir Philip also found he should have registered the trip at the time, but cleared him because he acted as soon as The Times revealed details of the trip.

The committee is recommending wide ranging changes to the way that ministerial rules are dealt with in future, a blow for Tony Blair who has long valued his independence in the hiring and firing of ministers.

Downing Street was resisting pressure from another standards chief, Sir Alistair Graham, to look at whether Mr Prescott had breached the Ministerial Code. Only the Prime Minister can investigate breaches of the Code, the last breach of which led to the resignation of David Blunkett, the former Home Secretary.

Sir Alistair, chairman of the Committee on Standards in Public Life, said that he welcomed the committee's report, which demonstrated the effectiveness of the independent policing arrangements for the MPs’ Code of Conduct and Register of Interests.

But he was concerned that the new arrangements for an investigation by Sir John Bourn, a ministerial adviser, into the facts surrounding an alleged breach of the Code were not invoked at the time when the allegations were made.

"This, in my view, raises serious questions about the effectiveness of the new procedure," said Sir Alistair.

He endorsed the committee's recommendation that the Prime Minister should consider introducing an independent element into the investigation of complaints of breaches of the
Ministerial Code.

"The arrangements for investigating alleged breaches of the Ministerial Code have been, and remain, an ongoing concern of the Committee on Standards in Public Life," he added.

Sir John was appointed in March to advise ministers on potential clashes between their public duties and private affairs - and to investigate any claims that the rules have been broken.

Mr Swire said it was clear that Mr Prescott had breached the code when he accepted hospitality from Mr Anschutz.

He said: "The Prime Minister cannot ignore the now overwhelming view that by staying at the ranch and accepting the gifts, Mr Prescott breached the code. It is simply untenable for Mr Blair not to launch an immediate investigation into the clear conflict of interest that has arisen. If he fails to do so, then any remaining shred of integrity that his government has will be in tatters. There is no way that Mr Prescott can be left to run the country with this damming indictment hanging over him."

But the Prime Minister's official spokesman tried to draw a line under the affair. He said that Mr Prescott had registered his stay at the ranch and the gifts he received. The Prime Minister believed that Mr Prescott had been perfectly right to discuss matters with Mr Anschutz and accepted that he was not involved in granting planning permission or a licence for a casino.

"In terms of the problem, the problem has been resolved because the Deputy Prime Minister has now registered both the stay and the gifts and he has set about improving the procedure for registering gifts in his department."

The spokesman rejected suggestions that ministers who breach the Code could get away with it. "No. What it means is, if there is a problem, you address that problem, but you also recognise that it is in the wider interest of the country that the Deputy Prime Minister meets an investor who is going to improve a major part of London in a very significant way."

Mr Prescott visited Mr Anschutz, who is involved in the regeneration of the area around the Dome, during an official programme of visits focussing on rural sustainability, farming and international trade. A Stetsun hat, pair of calf length boots, a belt and buckle, a pair of spurs and a pair of jeans together valued at around £600 were given to Mr Prescott during his stay and later posted to his department.

The committee found there were "shortcomings" within Mr Prescott’s department concerning recording of ministerial gifts which required "urgent attention". Mr Prescott said he "fully accepted" Sir Philip Mawer’s report.

"I have registered the stay at the ranch. The gifts, which were recorded at the time, will be notified in the annual return to Parliament next week, as is the usual practice."

He added: "I and my department also accept Sir Philip’s concern about the procedures operated within my department for reporting gifts. I have asked my department to undertake an urgent review of its procedures, and indeed we have already begun to implement new procedures."

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