DAVID Steel has had his name "cleared" and his suspension from the Scottish Liberal Democrats removed after a party probe into remarks he made about child sex abuse claims concerning the late MP Cyril Smith found "no grounds for action".

Today’s announcement by the Scottish Lib Dems to restore the party whip to the 80-year-old peer confirms the development revealed by The Herald last week.

Lord Steel was suspended and had the whip removed in March following the remarks, which he made to the Independent Inquiry into Child Sexual Abuse[IICSA].

The former Liberal Party leader explained that in 1979 he had asked his colleague about allegations that he had abused boys at a Rochdale hostel in the 1960s after an article appeared in the Private Eye satirical magazine.

READ MORE: Lord Steel suspended from Lib Dems over Cyril Smith revelation

Lord Steel said he came away from the conversation "assuming" Smith had committed the offences.

He explained: "It was before he was an MP, before he was even a member of my party. It had nothing to do with me."

The inquiry was told that the party had held no formal inquiry into the claims against Smith.

The allegations had been investigated by the police in 1969. However, no prosecution was brought.

Lord Steel, the former Holyrood Presiding Officer, described recommending his colleague for a knighthood in 1988.

He pointed out that he did not pass on any child abuse allegations because "I was not aware of any such allegations other than the matter referred to, which appeared to have been fully investigated".

However, Richard Scorer, a lawyer acting for seven victims in the abuse inquiry, said Lord Steel's "inaction was an appalling dereliction of duty".

He also said his admission that he had assumed Smith had committed offences would "cause victims great anger".

The claims against the late LibDem politician came to public prominence after Smith died in 2010.

In the 1960s, he was a Labour councillor in Rochdale before becoming the Liberal and then LibDem MP for the town between 1972 and 1992.

Willie Rennie, the leader of the Scottish Lib Dems, said: “The Executive of the Scottish Liberal Democrats has determined, after careful consideration, that there are no grounds for action against David Steel."

READ MORE: David Steel 'has Lib Dem whip restored and suspension lifted'

The Fife MSP stressed how the party took the issue of vigilance and safeguarding incredibly seriously, so it was important to investigate Lord Steel's evidence to the public inquiry. "In part because of a hearing difficulty and a lack of precision in providing some answers it was necessary to seek further information from him for clarification," he explained.

“The clarifications that David Steel has provided to us state clearly that Cyril Smith did not confess to any criminality which is why he took no further action at the time.

“David has also welcomed the changes to the country’s laws, procedures and policies on child protection, and that the party’s procedure for handling complaints about its members has improved. David makes clear his lifelong commitment to safeguarding and vigilance with a recommendation to the party on how to strengthen the system of candidate approval."

Mr Rennie added: “David Steel’s national and international reputation is beyond doubt and this has been a difficult matter for us to consider but it is important for everyone to understand that the Liberal Democrats will always investigate such serious matters.”

Lord David Steel said he was "naturally pleased and relieved" the party executive had "lifted my suspension from the party and cleared my name".

The peer stressed: “I believe in the highest standards of safeguarding for young and vulnerable people. As such, I voluntarily attended the IICSA hearing and offered open and honest answers, some of which have been erroneously reported and taken out of context. These inaccurate elements led some to question my own such commitment. Opinions and assumptions are not facts and those expressed in some quarters have caused me great personal distress."

READ MORE: Shame on Lord Steel over Smith revelation

He added: “Throughout my career, I have always acted to uphold the highest standards. I look forward to contributing to the party’s cause and focusing on the shared commitment we have had for many years, which is to lead to improve the life opportunities of all young people, especially those who have had the toughest start.”