OTTAWA—Conservative cabinet minister Peter Penashue will resign his seat to run again in a byelection after admitting his campaign accepted “ineligible” donations during the last election.

In a surprise statement Thursday, Penashue said he would quit as MP for Labrador and as minister of intergovernmental affairs and president of the Queen’s Privy Council for Canada to run again in a bid to clear the air around his 2011 election win.

“Although I was unaware of the inaccuracies in the return, I believe I must be accountable to the people who elected me and therefore I am stepping down as the Member of Parliament for Labrador and will seek re-election through a byelection,” Penashue said in a statement.

The Conservative Party of Canada has reimbursed the federal government the value of the ineligible contributions, about $30,000, the Star has learned.

Penashue blamed an “inexperienced” volunteer — former agent Reg Bowers — for accepting illegal donations.

Late Thursday, Bowers quit as a board member of the Canada-Newfoundland and Labrador Offshore Petroleum Board, a patronage post he got several months after the 2011 election.

Penashue has been facing questions that he accepted donations from board members of a St. John’s construction company — corporate donations are illegal — and that he exceeded his spending limit by $4,000. His campaign also allegedly accepted $25,000 in flights by a Labrador airline that mostly wrote off the costs.

Todd Russell, the Liberal incumbent who lost to Pensahue by just 79 votes, says the questionable spending played a “huge outcome” in the Conservative victory in the riding.

“Money influences elections. That’s why we have election spending limits,” Russell told the Star.

“There’s no doubt in my mind that the outcome of the election . . . was affected by election spending and overspending on the part of my opponent,” said Russell, who will take a few days before deciding whether to run in the byelection.

In his statement, Penashue said he appointed a new official agent to work with Elections Canada after mistakes were made by an “inexperienced” volunteer filing out his elections return.

“During the examination we became aware that there were ineligible donations accepted by the former official agent,” said Penashue, who did not return a call from the Star.

However, in an interview with the Star last fall, Bowers denied any knowledge of, or responsibility for excessive spending or illegal donations.

NDP MP Charlie Angus said Penashue did the right thing by stepping aside but said the Labrador MP has yet to explain his campaign’s questionable financial records.

“He needs to come clean. He needs to explain what precipitated this,” Angus said, adding that Penashue repeatedly sidestepped questions in the Commons.

“They were defiant about questions whether they bought that election, whether they accepted illegal contributions,” Angus said.

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Harper gave Penashue’s cabinet duties to Transport Minister Denis Lebel and in a terse statement thanked Penashue “for his service.”

Penashue is the second cabinet minister to step down in a month under an ethical cloud. John Duncan was forced to quit his post as aboriginal affairs minister after admitting that he wrongly lobbied a tax judge on behalf of a constituent.