Jonathan Aitken is to lead a study on prison reform for the Centre for Social Justice.

The former cabinet minister resigned as chief secretary to the Treasury in 1995 in order to launch a libel action against the Guardian, which had claimed that a Saudi businessman paid for him to stay at the Paris Ritz.

However the case collapsed in 1997 and, having insisted that the "simple sword of truth" would be on his side, Aitken was found guilty of perjury and perverting the course of justice in 1999.

He served almost seven months of an 18-month sentence before being released in January 2000.

Former Conservative leader Iain Duncan Smith, who heads the Centre for Social Justice, is set to confirm the appointment on Monday.

Duncan Smith told the Observer that "everybody deserves a second chance, that is the whole philosophy of the Centre for Social Justice".

"I am a profound believer in never writing people off," he said. "We are now using Jonathan's experience as a way of getting the most from him and him making a positive contribution to society."

And Aitken told Sky News the he was "not making a comeback". "This isn't some ego trip for me," he insisted.

"What I am doing is doing a quiet job of heading up a study group which is under the auspices of the Centre for Social Justice and we are going to look, with a very distinguished team of experts, at the whole field of potential prison reform policy ideas."

He added: "My prison sentence was certainly a painful experience, but it was also a positive experience because I learned a tremendous amount.

"Having had a worm's eye view in my life of prison and also having had something of a bird's eye view of government, I think that maybe I will bring some things to this group of experts - which is a team of which I am only one member."