Barker slams rival campaign as "unfounded smears"

Retired millionnaire Stuart Wheeler, who donated 5 million to the Tory party in 2001, has since set up the Trust Party and is standing in Bexhill and Battle.

His full-page adverts in the Observer and a leaflet campaign attack Mr Barker over his Parliamentary expenses claims, labelling him dishonest and unfit to represent the town.

With the General Election weeks away Mr Barker has hit back, calling the campaign: "an attempt to cash in on genuine public concerns about the Parliamentary expenses scandal by peddling the most extraordinary untruths about my own Parliamentary claims and expenditure".

In an open letter to Bexhill and Battle residents, Mr Barker, who was cleared of any wrong-doing in February by Sir Thomas Legg, said his expenses had been independently audited and "were all found to be in order."

He added: "More than 300 MPs, including Gordon Brown and Nick Clegg, were asked to make significant repayments. I was not asked to repay a penny."

He also dismissed attempts by Mr Wheeler, who lives in Chilham Castle, Kent, to draw attention to an alleged 320,000 profit made by Mr Barker through selling a property in Pimlico bought with the help of taxpayers' money.

The allegation surfaced during the Telegraph's investigation into the scandal which rocked Westminster in May last year.

Mr Barker said: "It is claimed I "flipped" seven times. This is completely untrue.

"During my decade in Parliament, for the purposes of having a Parliamentary base in London, I have only ever owned two properties.

"However, when my marriage came to an end in 2006, because of the substantial amount of our own private savings tied up in our London property, my ex-wife and I were obliged to sell. All of the major improvements and repairs had been funded entirely from our own pocket and it was this that accounted for the lion's share of the difference between the cost of purchase and the sale price.

"I do not claim to be perfect, but I believe voters must be told the facts.

"I do however fully support the radical measures to completely reform what was proved to be a thoroughly rotten expenses system.

"If you have any further questions on this or any other matter that is important to you, or would like to meet me during the course of the campaign, please don't hesitate to get in touch."