Will coalition star have credibility to carry on?

By Robin Brant
Political correspondent, BBC News

Image caption, Mr Laws has promised to pay back the money he claimed

Three weeks in and David Cameron's new politics is facing the first challenge to its status. Expenses hasn't gone away.

David Laws didn't declare that his landlord James Lundie was also his partner and that Mr Lundie had gained more than £40,000 in rent - paid for by the taxpayer.

Mr Laws is one of the stars of the new coalition government after the Liberal Democrat helped negotiate its founding agreement.

His reward was the number two job at the Treasury; he is the government's cuts man.

David Cameron now has to decide if his chief secretary has the credibility to carry on as the man deciding where and what to cut in government spending.

Mr Laws had promised to pay the money back immediately. Therein appears to be acceptance he may have appeared to have broken the rules.

His defence is he did not regard Mr Lundie as his partner, as far as the rules were concerned.

The parliamentary rules state MPs are banned from "leasing accommodation from a partner".

A partner is defined as "one of a couple... who, although not married to each-other or civil partners, are living together and treat each other as spouses".

Secret relationship

Mr Laws said Mr Lundie did not qualify. They did not share a bank account, they had separate social lives.

Their relationship was a secret, even from some family and friends we are told.

But the case against him appears to be a strong one. Mr Laws and Mr Lundie have been in a relationship since 2001.

Most people would class that as a serious relationship. Mr Laws admitted he increased his mortgage at one point to help Mr Lundie buy a new house.

The investigation will focus on his judgement that his partner was not - officially - his partner.

To what extent was that judgement influenced by the fact he wanted to hide the fact he had a male partner.

Mr Laws' job - to cut spending - is the top priority. His straight talking went down well with those listening and watching when he outlined the first wave of cuts last week.

Many think the former City high flyer, who made millions on judging the markets, brings an intellectual prowess unsurpassed by many of his peers.

He also symbolises the marriage of politics and policy which gave birth to the coalition.

Mr Cameron and Nick Clegg will regard him as invaluable.

They won't want to lose him but many will find it hard to sympathise - for whatever reason - with an MP who, still, appears to have got it wrong on expenses.