meetings with Premier Pamela Gordon yesterday, refusing to comment on the contents of the discussions or his political future.

Ms Gordon will be meeting with her Cabinet this morning to make her position on the controversy between Mr. Pearman and Government House clear. She is then expected to make a public statement.

Mr. Pearman is at the centre of an alleged drugs and sex scandal which he claims is an attempt to smear his reputation.

He claimed that Governor Thorold Masefield suggested to Ms Gordon that he be asked to step down after his name surfaced in Operation Cleansweep, a drugs surveillance operation.

Mr. Pearman, who was reached at his home yesterday afternoon, said: "I have spoken to (the Premier) now that she is back.

"We spoke about matters of serious concern to me and she has intimated some things that she is going to be dealing with over the next day or two.

"We will have to see how things develop from there.'' Last night senior United Bermuda Party officials would not be drawn on what Ms Gordon's position is likely to be when she meets with the Cabinet.

"I don't think there is much of an inner circle on this,'' one official said.

"The Premier is handling this herself.'' The Environment Minister has found himself under intense media scrutiny since reports surfaced that he was allegedly made the subject of a Police investigation.

Two persons who were arrested as a result of Operation Cleansweep -- a covert Police investigation that involved US law enforcement agents -- had cashed cheques that he had given them for work they had done at his home.

Soon afterward, Mr. Pearman charged that he had become the subject of Police surveillance, a claim the Deputy Governor has denied.

Still Mr. Pearman has expressed dissatisfaction with the way the matter has been handled.

And he said the campaign to smear his name springs from his wish to see Police Commissioner Colin Coxall return to the United Kingdom after his three-year contract is up.

He alleged that Mr. Masefield had suggested to Premier Gordon that he should be asked to step down.

Mr. Pearman is thought to have discussed this with the Premier yesterday to ascertain what exactly was said.

Ms Gordon only returned to the Island yesterday after spending several weeks in Canada and has yet to make a public statement on the controversy -- the most serious to affect her Government since she was elected Premier in April.

Mr. Pearman has threatened to resign from the United Bermuda Party and sit as an Independent MP, but Ms Gordon and Deputy Premier Jerome Dill have both said that they support him.

The controversy broke after cheques signed by Mr. Pearman, 70, surfaced in the Operation Cleansweep investigation.

Mr. Pearman said Police Commissioner Coxall had confirmed the Minister had been put under surveillance after two men netted under Cleansweep were found to have cashed cheques that Mr. Pearman wrote. One of the men is claimed to have said he had bought drugs for Mr. Pearman.

Mr. Pearman said he had hired two men -- suspected of being drug dealers -- in a bid to help get them back on track and the cheques were payment for work around his home.

The row took a fresh twist when Mr. Pearman said that allegations about his private life had also surfaced -- allegations he steadfastly denied.