Home Secretary Theresa May told Parliament it was "right" for the police to say they would examine any new evidence in the News of the World phone hacking case and the Government would "await the outcome" of any further action.
Responding to an urgent question in Parliament, she said the Metropolitan Police had indicated that "if there was further evidence, they would look at it".
Labour MP Tom Watson, who forced Mrs May to come to the Commons to answer the question, said she must not join a "conspiracy" to undermine the "integrity of our democracy".
He called on her to confirm whether former prime minister Tony Blair had asked Scotland Yard whether his phone was hacked.
It came after Downing Street communications chief Andy Coulson, the former editor of the News of the World, told police he would be happy to meet them voluntarily to discuss the new allegations.
Fresh attention has been focused on the case after a former NoW journalist Sean Hoare claimed Mr Coulson knew of eavesdropping tactics used at the newspaper during his time in charge.
Downing Street said the Prime Minister retained full confidence in Mr Coulson, who has consistently denied the claims, and that the new allegations made no difference to his position.
A spokesman for Mr Coulson said he had not been contacted by the police but was "happy to voluntarily meet with them following allegations made by Sean Hoare.
"Mr Coulson emphatically denies these allegations. He has, however, offered to talk to officers if the need arises and would welcome the opportunity to give his view on Mr Hoare's claims."
Metropolitan Police Assistant Commissioner John Yates said that he would be prepared to investigate Mr Hoare's allegations, which first surfaced in the New York Times.
Labour MPs and ex-deputy prime minister Lord Prescott have called for a fresh inquiry, and Lord Prescott is also seeking clarification from the Met over whether his phone was tapped.
