DAVID BLUNKETT, the work and pensions secretary, has admitted he broke the ministerial code of conduct by failing to consult an independent watchdog before taking a job with a biotech firm.

The former home secretary joined the board of the company, DNA Bioscience, for a two-week period before this year’s general election, when he was not a member of the government.

As a former cabinet minister, he was supposed to have informed the independent Advisory Committee on Business Appointments, set up to tackle allegations of sleaze, but did not do so.

Blunkett stands to make more than £450,000 for his family from his links to the firm after advising it on the government’s views about DNA technology. The return comes from an investment of just £15,000 made in DNA Bioscience in April, say company sources.

Blunkett joined the firm on April 21, 14 days before the election, and resigned when reappointed to the cabinet on May 6. He admitted breaching the code but argued that he acted in good faith on the basis of advice from the committee that later turned out to be incorrect.

During his period as a non- executive director, Blunkett carried out less than a day’s work for the company, according to a source, who said he offered advice on DNA technology and the government’s views on its future applications.

DNA Bioscience is hoping to win government contracts, including at least one from Blunkett’s work and pensions department, and has been accredited to conduct court paternity tests by the Department for Constitutional Affairs.

Blunkett’s remuneration included the right to buy 3% of the firm for £15,000, which he exercised. The company, due to float on the stock market next year, has been valued by City advisers at £15m-£20m, meaning the shares bought by Blunkett will now be worth between £450,000 and £600,000.

Last week the Conservatives called for an independent inquiry into Blunkett’s links with the firm. The minister confirmed he had bought the shares but denied he had acted improperly. He transferred his stake into a trust for his three elder sons after his appointment as work and pensions secretary.

He also said that he was not involved, and would not be in the future, in any negotiations about the firm. DNA Bioscience is majority owned by relatives of Tariq Siddiqi, the businessman who introduced Blunkett to Sally Anderson, the estate agent with whom he enjoyed several dinners.

It has emerged Blunkett first met the Siddiqis at a private dinner in spring this year, contrary to reports they had known each other for some time.

They began talking about DNA testing, which Blunkett had employed during his paternity battle with Kimberly Quinn, his former mistress. It is understood the minister then expressed interest in DNA Bioscience. It is believed the Siddiqis later raised the possibility of Blunkett joining the company.

A friend of Blunkett said: “He’d never been a director of a company before or had any shares. He was very impressed. He had seen other investment opportunities come and go and wished he’d got on the bandwagon. This was an opportunity for him because of his experience with DNA.”

Against Blunkett’s expectations, Tony Blair brought him back into the cabinet the day after his third election victory. Blunkett sought to cut ties to DNA Bioscience, though he stayed friends with the Siddiqis.

In June Siddiqi and his wife arranged for Blunkett to meet Anderson at Annabel’s nightclub in London. Anderson, who sold her story to a tabloid this month, claimed Blunkett had offered her use of his grace-and-favour home. She also claimed Siddiqi hoped that by getting the minister a girlfriend he might win government business for DNA Bioscience. Both allegations are described as “nonsense” by sources close to the company and Blunkett.

A spokesman for Robin Birley, owner of Annabel’s, confirmed reports Blunkett had been granted honorary membership of the club, which was not declared to parliamentary authorities.

Blunkett’s breach of the ministerial code last night prompted Chris Grayling, shadow Commons leader, to say Blunkett’s position was “increasingly untenable”. The code states, in section 5.29, that “ministers should seek advice from the (advisory committee) about any appointments they wish to take up within two years of leaving office”.

Blunkett’s spokeswoman admitted his breach of the code could not be described as “unwitting” because all ministers are reminded of the relevant sections when leaving office.

She added, however, that in earlier communications, the committee, chaired by the former Tory cabinet minister Lord Mayhew, had told Blunkett the code was “voluntary” for former ministers. She said: “He believed he was acting within the ministerial code, but with hindsight it might have been better if he had written to the committee prior to parliament returning.”

The spokeswoman said, however, Blunkett had “no idea” about any estimate of DNA Bioscience’s flotation value.

The company declined to disclose any details of its flotation plans or the firm’s value, saying it would be “commercially sensitive”. The Siddiqis were unavailable for comment.

Additional reporting: Sophie Kirkham

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