Sir Keir Starmer has claimed he "didn't know anything" about an alleged smear campaign carried out by the think tank Labour Together.
The Prime Minister also welcomed a Cabinet Office probe after Labour Together was accused of paying £36,000 to investigate the “backgrounds and motivations” of journalists researching the sources of its funding.
Speaking to journalists in Putney, the Prime Minister said: “There will be a Cabinet Office investigation into the allegations, and quite right too. And so that is already in place.
“I didn’t know anything about this investigation. And it absolutely needs to be looked into, so the Cabinet Office will be establishing the facts.”
Labour Together had been extremely supportive of Sir Keir's push for the Labour leadership in 2020, having already served as a critical voice of Jeremy Corbyn.
Morgan McSweeney, who resigned as Sir Keir's chief of staff this month, was also poached from Labour Together after the Prime Minister's victory in 2020.
Technology Minister Josh Simons is under pressure for his potential involvement in the scandal after serving as the think tank's director in 2023.
However, Sir Keir gave the Makerfield MP his "full confidence" following fresh revelations about the think tank's investigation.
The Prime Minister also welcomed a Cabinet Office probe after Labour Together was accused of paying £36,000 to investigate the “backgrounds and motivations” of journalists researching the sources of its funding
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Meanwhile, Mr Simons told the Sunday Times: “I was surprised and shocked to read the report extended beyond the contract by including unnecessary information on Gabriel Pogrund.
“I asked for this information to be removed before passing the report to GCHQ.
"No other British journalists were investigated in any document I or Labour Together ever received."
However, the Makerfield MP Josh Simons was accused of commissioning Apco to conduct its 48-page report.
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Makerfield MP Josh Simons was appointed as a Cabinet Office Minister in Sir Keir Starmer's September reshuffle | PARLIAMENT TVThe report, codenamed Operation Cannon, was completed in January 2024 before being handed to senior Labour officials who sat on the think tank's board.
However, GB News understands that the investigation's scope is somewhat limited by the events preceding Sir Keir's victory in the 2024 General Election.
Labour rebels have also put pressure on Sir Keir to provide proof he was not complicit in the investigation.
Ex-Shadow Chancellor John McDonnell demanded that any links between the think tank and the Sir Keir's Government must be the subject of an inquiry.
Sir Keir Starmer confirmed an investigation will look into Labour Together | GETTYMeanwhile, the SNP has called for Sir Keir to sack Mr Simons and requested information about what the Prime Minister knew about the claims before appointing the Makerfield MP as a minister.
However, Tory Party Chairman Kevin Hollinrake is urging Mr Simons to "recuse himself", adding: “The Labour Party must also investigate and review its ongoing relationship with Labour Together in light of these very serious accusations.”
New revelations about Labour Together have rocked No10 after Sir Keir was already under pressure over scandals involving Lord Mandelson and Lord Doyle.
The Prime Minister vowed to carry out yet another "reset", with Mr McSweeney leaving Downing Street over his involvement in the appointment of Lord Mandelson as the UK's Ambassador to the US.
Lord Mandelson will not return to the House of Lords | GETTYHowever, the scandal involving Labour Together centres around 10 pages on Gabriel Pogrund and Harry Yorke.
The Sunday Times said the claims described the findings as “deeply personal and fake claims”.
Ben Taylor, the editor of the Sunday Times, said Labour Together’s investigation into the sourcing of the newspaper’s report “went way too far”.
He also accused Apco of including “extraordinary details” that were “frankly lies” about Mr Pogrund.
Apco ramped up its investigation after the Sunday Times revealed that Labour Together had failed to declare £730,000 of donations between 2017 and 2020.