Juppe says other parties also resorted to illegal financing

The alleged fraud took place in the late 1980s and early 1990s when Mr Chirac was Mayor of Paris and Mr Juppe was secretary general of the RPR party.

Investigations into Mr Chirac and the affair were dropped after a court ruled that he had presidential immunity while he remained in office.

Altogether 27 people - party officials and businessmen - are in court, and the trial is expected to last three weeks.

"I have come to court to explain the working and financing of a political party, the RPR, in the early 1990s, more than 10 years ago," Mr Juppe told reporters as he arrived at court in the Paris suburb of Nanterre.

"It's my duty as a citizen and as a political official."

Political ban?

This is the biggest court case to arise out of several party funding scandals at Mr Chirac's RPR during his long tenure as mayor of Paris which ended with his election to the presidency in 1995.

President Chirac has presidential immunity from prosecution

Under the fake jobs scam, party officials were paid with money that came straight from municipal coffers or from private companies who chipped in in order to get building contracts.

According to the prosecution, Mr Juppe - who was finance director at Paris City Hall at the time as well as being in charge of Mr Chirac's party - must have known what was going on.

However, some of the more serious charges against him have been dropped in the course of the investigation.

Mr Juppe was prime minister of France from 1995 to 1997, and he is now once again in charge of the presidential party, renamed the Union for a Popular Movement (UMP).

He has admitted that as such a senior figure in the RPR, he bears some responsibility for what went on - though he says that at the time, before state funding of political parties, all parties were resorting to illegal ways to raise money.

If found guilty, he faces a maximum five years in jail.

Also - and more seriously for his known political ambitions - he faces a ban on holding public office.

As for Mr Chirac, who has also been heavily implicated in the affair, he is free from prosecution as long as he remains president of the republic.