Hain accused a minister of being involved in a sex scandal

Mr Hain was close to facing legal action over accusing a Conservative government minister of involvement in a sex scandal, government letters reveal.

But the Tories dropped the idea for fear a prosecution would be turned into a stage trial.

The threat is exposed in correspondence made public by the National Archives.

The letters, sent between the offices of the attorney general and the prime minister in 1973, came after Mr Hain named Tory MP Geoffrey Rippon in a magazine as the third minister involved in a prostitution scandal.

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The scandal forced the resignations of the Defence Minister Lord Lambton and the Lord Privy Seal, Lord Jellicoe.

The first letter, sent from Prime Minister Edward Heath's principal private secretary Sir Robert Armstrong to the attorney general's office, quoted a legal opinion that suing Mr Hain would have been pointless.

"No one in his senses would sue somebody like Peter Hain for libel, because people like that had no resources with which to pay costs, let alone damages; anybody suing them would probably find himself having to pay his own costs, even if he won the case," it said.

Rare trial

Sir Robert raises the possibility of starting criminal libel proceedings.

A member of the attorney general's staff replied that a prosecution under criminal libel laws should only be brought if the libel was likely to "disturb the peace of the community".

He added such a trial would be so rare it might bring unwanted attention upon the victim.

Peter Hain was an anti-apartheid campaigner in the 1970s

Sir Robert replied that prosecuting cases such as Mr Hain's "would be a recognition by the authorities that civil proceedings were likely to be ineffective ... and that the purpose of the libel was not just to defame an individual but to bring institutions into disrepute and thus, in the end, disturb the peace of the community".

But he concluded that a first prosecution would have to be "carefully chosen".

Mr Hain joined the Labour party in 1977 and entered the House of Commons in 1991.