The chairman of a Commons committee today denied breaching lobbying rules amid claims that he used his position to help business clients.
The Government will bring forward a bill to introduce a statutory register of lobbyists before Parliament's summer recess in July.
The hastily announced Government bill to create a statutory register of lobbyists is a highly politicised piece of legislation.
Labour and Tory MPs have criticised the Government's lobbying reforms as an attack on free speech which would gag charities from voicing their concerns.
The backbench MPs said the legislation failed to properly monitor large lobbying firms while putting unnecessary restraints on the charities and think-tanks which might want to speak out about Government policies.
Commons Leader Andrew Lansley sought to play down the concerns, telling MPs that charities and other voluntary organisations should not be "alarmed".
He said the legislation was "perfectly rational" but added the Government would amend the Bill if there was any chance it could prevent MPs going about their usual work.
As part of the Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Bill, a cap of £390,000 would be set on the amount any organisation - excluding political parties - could spend across the UK in the run-up to elections.
David Cameron is facing calls for an urgent rethink of government legislation aimed at preventing future lobbying scandals.
The chairman of the Commons committee which has been examining the Lobbying Bill has warned the plans lack credibility, dismissing them as a "dog's breakfast".
Labour MP Graham Allen, who heads the Political and Constitutional Reform Committee, said the bill would not open up the "2 billion lobbying industry to effective scrutiny.
He told The Independent: "The new lobbying law is rushed and ridiculous. Instead of addressing the Prime Minister's promise to 'shine the light of transparency' on lobbying, this flawed legislation will mean we'll all be back in a year facing another scandal. It is a dog's breakfast."
Mr Allen has taken the unusual step of recalling his committee during MPs' summer break for a series of special hearings to take further evidence from leading figures involved in the industry.
The bill is due to start its passage through Parliament when MPs return to Westminster, but Mr Allen is hoping the move will force ministers to rethink their plans.
Conservative MP Tim Yeo is foregoing his select committee chair's salary - worth £14,728 a year - after stepping down from the role while he awaits the conclusion of the Standards Commissioner's inquiry.
Tim Yeo has formally stood aside as chairman of an influential House of Commons committee after claims that he used his position to help business clients.
Members on the Energy and Climate Change Committee unanimously accepted the Conservative MP's offer to step down temporarily while the Parliamentary Standards Commissioner carries out an inquiry.
After meeting fellow committee members behind closed doors at the House of Commons, Mr Yeo left before the meeting moved into open session.
Mr Yeo said: "They have unanimously accepted my offer to stand aside for the duration of the inquiry."
The former minister said in a statement last night that he took the decision to ensure the "smooth running" of the committee, and insisted he had not breached Commons rules when he spoke to undercover reporters from the Sunday Times.
The Conservative MP Tim Yeo has said he is to temporarily stand aside as chairman of the Energy and Climate Change Committee "solely to ensure the smooth running of the committee during the next few weeks" while the Parliamentary Standards Commission investigates lobbying allegations:
I have decided that at the private meeting of the Energy and Climate Change Committee to be held tomorrow morning I will recommend to members of the committee that for the period until the Parliamentary Commissioner for Standards, to whom I have referred myself today, has completed her investigation I will temporarily stand aside from the chairmanship of the committee.
I am doing so solely to ensure the smooth running of the committee during the next few weeks.
I firmly believe that I have not breached the MPs' Code of Conduct in any respect and therefore await the outcome of the commissioner's investigation with confidence.
In particular I absolutely and unreservedly deny the allegation that I coached a witness with whom I have a business connection before that person gave evidence to the committee.
I do not wish the Commissioner's investigation to be a distraction from the Committee's important work.
I believe that during the past three years the committee has been extremely effective and I want this to continue.
The Conservative MP Tim Yeo has said he intends to temporarily stand aside as chairman of the Energy and Climate Change Committee while the Parliamentary Standards Commission investigates lobbying allegations against him.
Labour has called on Conservative MP Tim Yeo to stand down as chairman of the Energy and Climate Change Committee after claims that he breached lobbying rules by allegedly offering to use his position to further business interests.
– shadow cabinet office minister Gareth Thomas
Tim Yeo has the right to defend himself but it is difficult to see how he can continue as chair of the select committee pending investigation by the Parliamentary Standards Commissioner.
If David Cameron won't act then Tim Yeo should take it upon himself to stand down from his post.
Mr Yeo has denied the claims and has referred himself to the Parliamentary Standards Commissioner.
The chairman of a powerful Commons committee has been reported to police by political blogger Paul Staines, who runs the Guido Fawkes website.
Mr Staines wrote in a letter to Scotland Yard: "The public interest is, you will no doubt agree, best served by holding elected law-makers to the highest standards.
"I urge you to proceed with an investigation using the evidence available".
Mr Yeo, who chairs the Energy and Climate Change Committee denies the claims and has referred himself to the Parliamentary Standards Commissioner.
The chairman of the Energy and Climate Change Committee has referred himself to the parliamentary standards commissioner, amid allegations that he used his position to help business clients.
The newspaper's footage showed Mr Yeo seemingly suggesting that he had coached a paying client on how to influence the committee. Tim Yeo said today:
The person concerned is John Smith, Managing Director of GB Rail Freight, a subsidiary of Groupe Eurotunnel SA, of which I have been a director and shareholder since 2007.
I travelled with John Smith and two other people in the cab of a freight train for three hours on May 16, five days before he appeared before my Committee.
I spoke briefly to Mr Smith about his forthcoming appearance in front of the Committee to explain that because of the business connection between us I would not take part in questioning him. I did not want him to think that my silence indicated a lack of interest in what he was saying.
I did not 'coach' John Smith on this or any other occasion. He is not a 'paying client' as the Sunday Times alleges but a business colleague.
I am confident that I have acted in accordance with the MPs Code of Conduct at all times.