Leveson Report: David Cameron faces defeat in press-regulation vote despite attempts to strike a deal with Nick Clegg

David Cameron is staring a heavy Commons defeat in the face after last-ditch attempts to secure a compromise on press regulation stalled tonight.

The Prime Minister made a personal appeal to his deputy, Nick Clegg, to break off the temporary alliance he has formed with Ed Miliband. The Liberal Democrat and Labour leaders want a regulator underpinned by statute. But Labour sources claimed tonight that his appeal had failed and the Liberal Democrat-Labour coalition, boosted by some backbench Conservatives, should have the numbers to defeat the Prime Minister.

Both sides agree that there should be a new press regulator overseen by a board governed by a Royal Charter signed by the Queen, but they have been arguing ferociously over whether the charter should be backed by legislation, how much power it should give to regulator, and whether the newspaper industry should be able to veto the appointment of a regulator they regard as hostile to their interests.

A senior Labour source said: “We are in lock-step with the Lib Dems on this. Ed Miliband spoke to Nick Clegg twice before Nick spoke to David Cameron and once after. We are clear we are not going to accept their Royal Charter. Any agreement must be on the basis of our Royal Charter.”

This leaves Mr Cameron facing the combined opposition of Labour and the Liberal Democrats, with more than 20 of his own MPs thought likely to rebel, giving Ed Miliband a clear Commons majority to push through his version of the Royal Charter, which is closer than Mr Cameron’s to the recommendations that emerged from the inquiry into the press headed by Lord Justice Leveson.

A senior Tory said tonight: “We are continuing discussion to try to secure agreement.”

Earlier in the day, there were hints from both sides that a last-minute agreement might be within reach. “There’s an opportunity to bring people together,” the Chancellor, George Osborne, told the BBC’s Andrew Marr programme. “The big decision, which is … to have a Royal Charter has been taken and the other parties have conceded that, so now we’re into other issues. The key thing here is a press law that works.”

Labour’s deputy leader, Harriet Harman, also hinted at a possible deal. “We’ve always said we would like to reach agreement and actually we could then come to the House of Commons with an agreed position and say ‘yes, this is what we want,” she told the Sky News Murnaghan programme. “There are just a few issues that remain between us, but they are quite important ones.”

Simon Hughes, the Liberal Democrat deputy leader, made it clear on the same programme that the anti-government has the votes to carry the Commons. “On our side of the argument there are Conservatives – up to 60 at the maximum but probably 20 core people. There are Irish parties, nationalist parties, the Green Party, Labour, the Liberal Democrats and possibly some Tories – now that’s quite a big coalition,” he said.

When David Cameron walked out of talks with the other parties, he said that if they passed a law that he opposed, it would be overturned in the next Parliament if the Conservatives secure a majority – but Mr Hughes’s figures beg the question of whether that threat could be effective.

Potential Tory rebels were given open encouragement yesterday by a former party chairman. Norman Fowler, a Cabinet minister under Margaret Thatcher and John Major, who argued that there should have been a free vote on an issue that affects press freedom. “There may be a last-minute compromise, but if I was still a Conservative MP I would be voting against my party,” he said.

J.K. Rowling, author of the Harry Potter series, also called on MPs to oppose the government. “I believed David Cameron when he said that he would implement Leveson’s recommendations ‘unless they were bonkers’,” she said.

“I did not see how he could back away, with honour, from words so bold and unequivocal. Well, he has backed away, and I am one among many who feel they have been hung out to dry. I am merely one among many turning their eyes towards Ed Miliband and Nick Clegg and hoping that they have the courage to do what Cameron promised, but which he failed to deliver.

But the Tory MP Douglas Carswell, a frequent rebel, described statutory regulation as “unworkable”, though he added: “A small part of me wants it to go through so we can see the utter balls up that follows.”

Press reform: the sticking points

Where the two sides agree:

Self regulation of the press, through the much criticised Press Complaints Commission will end, and an independent regulator will have much tougher powers to penalise bad behaviour. The regulator will be appointed and overseen by a board governed by Royal Charter, whose wording cannot be altered unless the leaders of the three main parties and two thirds of MPs agree

Where they disagree:

David Cameron has a draft Royal Charter under which the choice of a regulator would have to be unanimous, rather than by majority vote, giving representatives of the newspaper industry a veto. The regulator would not have the same power to order newspaper where to place corrections and apologies as in the Miliband-Clegg version of the Charter, and Cameron does not think it necessary to pass a law to underpin the Charter.