Aitken: Denied allegations

Aitken "Could be Dropped From Privy Council"

Former Cabinet minister Jonathan Aitken could be struck off the Privy Council, it has been confirmed.

Privy Council sources said they were examining the procedures, which are based on few precedents.

But they stressed that no action is currently active against Mr Aitken, who dropped his libel action against the Guardian and Granada TV.

Pressure on him to resign may mount if criminal charges for alleged perjury are brought against him.

However, only the Queen has the power to strip a Privy Counsellor of his office, which is granted for life, on the advice of the Privy Council itself.

"We are looking at what the procedures are," a senior Privy Council source said.

"There is nothing active at the moment but, obviously, some people have been doing some background work.

"This has not been done for a very long time, but there is a procedure whereby the Privy Council can be asked to take action."

Such a sanction has not been used for more than 75 years. In 1921 Sir Edgar Speyer, a friend of Liberal Prime Minister Herbert Asquith, was struck off the Privy Council list after being convicted of collaborating with the Germans in World War I.

Two others have resigned - John Profumo, the War Minister, who lied to Parliament about his affair with a call girl in 1963, and John Stonehouse, the former Labour Minister convicted of theft in 1976.

A report in the Mail on Sunday claims Mr Aitken "will be axed from the Queen's inner circle of advisers ... and stripped of the privileged title `Right Honourable"'.

The council's main function is to advise the Queen on royal proclamations, and is responsible for supervising the registering bodies for the medical and allied professions. It was once the chief source of executive power until the system of Cabinet government developed.

Aitken with his wife

Face-saving Settlements Turned Down

The Guardian newspaper has confirmed that it twice offered Mr Aitken a face-saving settlement after being approached by an intermediary on his behalf.

As long as a year ago, Mr Aitken approached them via an intermediary - believed to be advertising guru Lord Saatchi - in a bid to settle the case before it ever came to court.

A spokeswoman for the paper said: "There were two opportunities for Jonathan Aitken to walk away, one a year ago and the other in April this year.

"We wouldn't offer to pay a penny to him, but we were offering a face-saving formula. In both cases, it was Mr Aitken's intermediary who approached us and in both cases he chose not to go ahead with the deal."

Guardian editor Alan Rusbridger said he found Aitken's decision not to settle "idiotic".

The formula on offer is understood to have involved both sides covering their own costs but neither side admitting guilt. A short piece in The Guardian would have announced an amicable settlement.

Instead, Mr Aitken now faces bills estimated at £2m and the prospect of possible prosecution and imprisonment for perjury.