'Clear breach'

Throughout the conversation with the undercover reporters, Dannatt emphasised that he would need to declare the client he was working with in any dealings with ministers.

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"Provided in any conversation I declare what my interest is, then I can report that back," he said.

He further emphasised this in his formal response to the Guardian. "I said at the outset that I need to be transparent in anything that I did for a commercial company," he said.

He added that he felt he had been a target of a deliberate sting that set out to entrap him. He said that if he had taken up the role, he would have included it in his entry of interests in the House of Lords register.

However, the rules governing the conduct of peers state they are banned from lobbying ministers, which includes introducing clients with commercial interests, regardless of whether they declare that they are being paid.