Liam Fox has apologised after a weekend of claims his friendship with Adam Werritty breached national security.
In a statement on Sunday evening, he told journalists the boundaries between his personal and professional life had been blurred:
"I accept that it was a mistake to allow distinctions to be blurred between my professional responsibilities and my personal loyalties to a friend."
"I am sorry for this. At no stage did I or my department provide classified information or briefings to Mr Werritty or assist with commercial work, let alone benefit personally from this work ...
"Nevertheless, I do accept that given Mr Werritty's defence related business interests, my frequent contacts with him may have given an impression of wrongdoing, and may also have given third parties the misleading impression that Mr Werritty was an official adviser rather than simply a friend.
"I have learned lessons from this experience.
"I accept that with the benefit of hindsight I should have taken much greater care to ensure that any meetings with Adam Werritty, at which defence and security related issues were raised, were properly attended by officials and recorded – to protect myself and the Government from any suggestion of wrongdoing.
"With respect to my meeting with Mr Boulter in Dubai in June 2011, I accept that it was wrong to meet with a commercial supplier, without the presence of an official.
"I have apologised to the Prime Minister and agreed with my Permanent Secretary to put in place new procedures to ensure that this does not happen again.
"My Permanent Secretary will report her interim findings to the Cabinet Secretary tomorrow. It is important that this process is allowed to run its course. I will answer all questions in the House of Commons."
The defence secretary had been under intense pressure over the last 48 hours after it emerged Werritty, who despite having no official government job or security clearance, accompanied Fox on foreign trips, set up meetings for him and described himself as his adviser.
Central to the allegations are whether Werritty benefited either personally or professionally from his claims to work for the defence secretary.
Shadow defence secretary Jim Murphy has written to the prime minister saying the MOD investigation appears to have "significant shortcomings"
The letter says: " The terms of reference, however, seek solely to “establish that there has been no breach of security”, with no mention of the Ministerial Code."
Murphy adds: "I agree with you when you said that the British people “expect the highest standards of conduct” from politicians. This is an opportunity for you to enforce that sentiment."
On Friday Fox himself ordered an internal Ministry of Defence inquiry into whether he had breached national security. That inquiry is being carried out by Ursula Brennan, the department's permanent secretary.
She originally expected the investigation to take two weeks. Her report will be examined by the most senior civil servant, Sir Gus O'Donnell.
However on Saturday afternoon Downing Street announced that the Prime Minister wanted the interim findings of that report on his desk by Monday morning.
In response to Liam Fox’s statement Labour said serious questions remained. Kevan Jones MP accused Fox of being in denial:
“This is a remarkable admission. Just 24 hours ago Liam Fox called these allegations ‘baseless’ and now he has apologised, but yet is denying any wrongdoing took place.
“The Defence Secretary simply cannot have sensitive meetings behind the back of his officials. This is incredibly serious and this response in incredible.
“This is a man in denial. We need a full explanation of the very serious questions which remain.
“There is no need for new procedures, but there is a need for a Secretary of State who abides by existing ones.
“The public will be deeply unimpressed if this obfuscation continues and it is the duty of the Prime Minister to make sure this is no longer allowed to cloud the character of his government.
“This inadequate response is exactly why we need a full and proper inquiry led by the Cabinet Office into whether the Ministerial Code has been breached.”