The government is preparing to examine legislative proposals on the extension of state funding for political parties.

Today's Times reports that the Cabinet's electoral policy committee will consider ways of extending public subsidies for political parties this autumn when it completes work on the reform of the House of Lords.

The decision to examine state funding came as Labour was again censured for breaking the rules on donations to political parties by failing to meet the deadline on reporting gifts from supporters. Labour said that "simple human error" had caused the reports to be late.

Labour's top donor in the last quarter was businessman and philanthropist Sir David Garrard who donated £200,000. Mick Hucknall, the Simply Red singer, also gave Labour £25,000.

These donations helped Labour to record a total of £3.1 million in the second quarter of this year - nearly twice the £1.7 million received by the Conservatives.