Tony Blair insists the issue of handing out party seats in the Lords has got confused

Blair: Labour peerages not for sale

Blair: Labour peerages not for sale

Tony Blair has robustly denied the allegations that peerages were given to wealthy Labour donors who gave the party loans prior to the last general election.

The prime minister explained that the lines between honours and working peerages had become blurred, and this was what lay behind the cash-for-peerages scandal.

“Nobody in the Labour party to my knowledge has sold honours or sold peerages,” he told BBC One’s The Politics Show ahead of this weekend’s G8 summit in St Petersburg.

“The fact that is sometimes excluded from the public’s mind in relation to this debate is that there are places in the House of Lords that are reserved for party nominees for their party supporters.

“These are not honours, they are working peerages reserved for party supporters, Conservative supporters, Labour supporters and Liberal Democrat supporters.”

Although Mr Blair refused to be drawn on the arrest of Lord Levy, Labour’s chief fundraiser and his personal Middle East envoy, in connection with the allegations, he admitted that the accusations themselves had been damaging enough.

“Perception is a real problem and obviously one of the biggest worries in this is that while the police inquiry goes on, effectively everyone gets tried in the media, which is not always the most objective and impartial on these issues,” he said.

“Of course we have had people that have got themselves into difficulties and ministers being dismissed and we’ve had huge problems obviously on this front.”

Mr Blair hinted that in the future new legislation would be introduced regarding the way in which political parties would be funded, including spending caps on election campaigns and a contribution from the taxpayer.

He concluded by stating again that he felt under no pressure to step down from the country’s top job, despite calls from the Labour party’s former deputy leader, Lord Hattersley, this morning that it was time for him to hand over the reins to Gordon Brown.

“I’ve made it clear all the way through, I’ll carry on doing the job. And so I look forward to next year’s G8 of course but in the end the most important thing is to do the job,” he added.