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The Metropolitan Police says it is not investigating allegations No 10 staff broke Covid rules in December of last year due to "an absence of evidence".
A video obtained by ITV shows No 10 aides joking about holding a Christmas party amid lockdown restrictions.
Following an angry backlash, the PM's former spokeswoman, who appears in the clip, stepped down from her role.
Labour has urged the police to pursue an investigation "without fear or favour".
Shadow health secretary Wes Streeting said it was "simply implausible for the police to argue there is no evidence parties took place", adding: "We have all seen the video involving No 10 staff referring to the party on 18 December."
Boris Johnson has apologised for the clip of Downing Street staff and has asked senior civil servant Simon Case to carry out an inquiry into whether rules had been broken.
Meanwhile, a Conservative Party spokesperson has confirmed four of its staff - who had been seconded to the party's London mayoral campaign - were disciplined following an unauthorised social gathering in one of the party's offices on 14 December last year.
The BBC has also been told that last year several Downing Street staff members attended a gathering with Carrie Johnson in the flat where the prime minister and his wife live after former aides Dominic Cummings and Lee Cain had left No 10.
A source said music was blaring and could be heard elsewhere in the building.
The party is understood to have taken place on 13 November last year, when England was in lockdown, with people barred from meeting indoors or in private gardens.
But several of those who were said to have been there have told the BBC the claims are not true and Mrs Johnson's spokeswoman denied there was party on 13 November.
It's not over because there is no clear account of what went on behind the No 10 door. It's not over because an investigation will now take place to establish those facts.
It's not over because there are claims of at least three other gatherings in Downing Street - denied but not fully explained, and one other confirmed. It's not over because the opposition parties have no intention of letting this lie.
And it's not over because the mood in Boris Johnson's own party is becoming more sour by the day.
And it matters, not just because of grisly or embarrassing details of what jokes were cracked or games were played.
But it matters because to confront the pandemic the government has always, as now, relied on two precious commodities.
It needs public faith in the action it's taking and political goodwill for those measure to be approved.
That pair of factors defies scientific measurement, but with the pandemic surging again, the concern must be, they are both in shrinking supply.
Asked about events reported to have happened in Downing Street last year, the prime minister said: "As far as I'm aware, to the best of my knowledge we have followed the rules throughout."
Speaking at a press conference, the prime minister said Mr Case could investigate reports of other parties saying: "He may wish to look at other things but that is a matter, frankly, for him."
The Mirror first reported the story over a week ago of a Christmas party that took place on 18 December 2020 in Downing Street.
A source has since confirmed to the BBC that a party did indeed take place and "several dozen" people attended.
No 10 repeatedly insisted that there had not been a party and that all coronavirus guidance had been followed.
However, the clip obtained by ITV News appeared to show Downing Street staff on 22 December rehearsing how to respond to potential questions about a party "on Friday night".
Laughing, the prime minister's then-press secretary Allegra Stratton replies: "I went home", while another aide jokes: "It wasn't a party, it was cheese and wine."
"Is cheese and wine alright," she asks, before adding: "This fictional party was a business meeting and it was not socially distanced."
Following the release of the clip, Ms Stratton resigned from her role as COP26 spokeswoman.
Reading out a statement while in tears, she said: "To all of you who lost loved ones, who endured intolerable loneliness and who struggled with your businesses, I am truly sorry."
Following the release of the video, the police said it had received a "significant amount of correspondence" relating to reports of rule breaches in Downing Street.
"Based on the absence of evidence and in line with our policy not to investigate retrospective breaches of such regulations, the Met will not commence an investigation at this time," it said.
The statement added that the Met had spoken to the Cabinet Office about Mr Case's investigation and that "if any evidence is found as a result of that investigation, it will be passed to the Met for further consideration".
The events surround the Downing Street party on 18 December have angered many including some Conservatives.
Scottish Conservative leader Douglas Ross said Mr Johnson should quit if he was found to have misled Parliament.
He told Sky News: "If he knew there was a party, if he knew it took place, then he cannot come to the House of Commons and say there was no party."