Senior Conservatives are feuding over a £2 million private fund set up by Lord Ashcroft, a former party treasurer, to help Tory candidates in marginal seats.

The catalyst for the row was a cheque for £500,000 which the Tories' treasurer, Jonathan Marland, gave to Lord Ashcroft 10 days ago.

Some Sunday papers said this suggested that Lord Ashcroft had fallen out with the party.

But the cheque was actually a down payment on an overdue loan he made to help finance the cost of the Tories moving from their previous headquarters in Smith Square, Westminster.