KEY POINTS:
LONDON - Millionaire Labour Party donors have contradicted Tony Blair's evidence to the police in the cash-for-honours affair amid claims he is "at war" with his chief fundraiser.
The Prime Minister is refusing to give any backing to Lord Michael Levy, the man who helped secure £14 million
(nearly $40 million) in secret loans for Labour before last year's election.
Lord Levy, known as "Lord Cashpoint" is one of only three people arrested over the loans affair.
The donors at the centre of Blair's interview with police on Friday say they were nominated for their public service to the nation, not for services to Labour, as claimed by the Prime Minister.
Secret official papers support their claims.
The donors expressed surprise after Blair's interview with Scotland Yard detectives in his Downing St home last Thursday, when he said the honours were "party peerages given for party service".
But the official nomination documents, marked "Restricted Appointments", say Blair's "grounds for recommendation" to the House of Lords were the donors' work in education, health and charity.
The leaked citations make no mention of "party service".
Blair's claim has baffled the donors, who believe they were nominated for their contribution to society.
Curry magnate Sir Gulam Noon, who lent £250,000 ($707,000) to Labour, said he had been nominated for a peerage "for my charitable work and my building of the business".
A spokesman for Sir David Garrard and Barry Townsley, said: "My recollection was they were told it was for services to education."
And a friend of Dr Chai Patel - founder of the Priory Group, Britain's largest independent provider of mental health services - said: "When he was nominated, he thought it was for public service."
Opposition politicians queried the nature of the "party service" the millionaires provided, as none has a track record of Labour Party activism.
It is not known whether Garrard is even a Labour Party member, and Noon has also given cash to the Liberal Democrats.
A Labour spokesman said the "party service" referred to their willingness to serve as working Labour Party peers.
But Lord Oakeshott, a Liberal Democrat spokesman, said: "What services have the failed peers performed for Labour apart from giving big donations? The sooner Mr Blair has to tell the truth on oath in court about the real reasons he nominated these people for peerages the better."
Lord Levy became the focus of the police inquiry after Blair said he did not have "full knowledge" of financial help received by Labour or the nomination of lenders for peerages.
The row follows increasing suggestions from Blair's allies that he was "in the clear", but Levy remained of great interest to the police.
Levy is understood to be trying to throw all responsibility for the scandal back on the Prime Minister.
Friends claim that his role was secondary to that of Blair.
One friend said: "Honours ... are only given by one person. At the end of the day [Blair] is the only one who can sign off on them."
- INDEPENDENT ON SUNDAY, AGENCIES
