Education Secretary Michael Gove faces a fresh coalition clash with the Liberal Democrats after he refused to rule out the appointment of a Conservatives Party donor to head the schools inspectorate, Ofsted.
The Lib Dems have warned they will not accept a "Tory donor ideologue" to chair the watchdog amid reports that Theodore Agnew, an insurance magnate who worked closely with Mr Gove before the 2010 general election, was being lined up to replace the Labour peer, Baroness Morgan of Huyton.
The Education Secretary insisted the appointment would be made on merit and that it would be "quite wrong" to rule out a suitable candidate simply because he was a Conservative.
"I want to make sure that we have the widest range of candidates and I don't think anyone should be ruled out on the basis of their political allegiance," he told BBC1's The Andrew Marr Show.
"If someone is a distinguished former Labour minister and they want to put their hat in the ring, then I would look favourably on that. If there's a distinguished Liberal Democrat educationalist, great. If there's someone who's a Conservative, why should they be ruled out just because they are a Conservative? I think that would be quite wrong."
The Lib Dems were already angry with Mr Gove over his surprise decision not to reappoint Lady Morgan for a second term.
Mr Gove's Lib Dem deputy, the Schools Minister David Laws, was said to be ""absolutely furious" at what he saw as a blatant attempt to "politicise" Ofsted.
A source close to Mr Laws said: "The decision to get rid of Sally Morgan had absolutely nothing to do with her abilities, or even education policy, and everything to do with Michael Gove's desire to get his own people on board.
"David Laws is absolutely determined not to let Michael undermine the independence of this vital part of the education system."
Mr Gove denied Lady Morgan had been removed because she was Labour, saying she had done a "fantastic job" at Ofsted but that it was "good corporate practice" to regularly "refresh" the leadership of such organisations.
"From time to time you need to refresh the person who is the chair of a particular body in order to bring a new pair of eyes to bear. At the end of an individual term I think it is appropriate to consider whether or not we might need to have a new person who can bring a new perspective," he said.
"This Government is perfectly happy to appoint people whatever their political background to important jobs. I appointed Sally (Lady Morgan) in the first place knowing she was Labour.
"If there's a John Reid or if there's John Hutton (former Labour cabinet ministers), if there's an outstanding Labour candidate who wants to do it, then I and the Government will look on their application with the same degree of favour as we would on anyone else who is highly qualified."
The latest row comes just a week after Chief Inspector of Education Sir Michael Wilshaw voiced his anger at the Education Secretary in the wake of media reports that two right-wing think tanks were drawing up plans to reform or even replace Ofsted.
Mr Gove was forced to issue a statement voicing his full support for Sir Michael and promising to dismiss any aides if they were found to be part of any "dirty tricks" campaign.
Although Lady Morgan is a former close adviser to Tony Blair, her departure from Ofsted was seen as a particular surprise as she was regarded as a strong supporter of Mr Gove's free school and academies programmes.
Lady Morgan insisted that there had been no falling out with Mr Gove and blamed Downing Street for orchestrating a campaign to remove non-Conservatives from senior positions on public bodies and replace them with loyal Tories.
Downing Street however made clear that the decision not to reappoint her had been the Education Secretary's.
A senior Lib Dem source made clear that they would resist any attempt to appoint Mr Agnew, who is a trustee of the Policy Exchange think tank which Mr Gove helped establish and who now sits on the Department for Education's academies board, in her place.
"Education policy is far more important than rewarding a few Tory cronies. The Lib Dems will not let our children's education be dictated by some Tory donor ideologue," the source said.
For Labour, shadow education secretary Tristram Hunt said the Lib Dems shared responsibility for what was happening at Ofsted.
"Lib Dem crocodile tears about the decision to sack Sally Morgan is too little, too late and Lib Dem gesture politics of the worst kind. Nick Clegg and David Laws are failing to prevent attempts by the Tories to politicise Ofsted," he said.