Prince Philip lobbied the Prime Minister when John Major spent a weekend with the Queen at Balmoral to reverse a decision by the National Heritage Memorial Fund not to back one of his pet projects, the expansion of the National Maritime Museum, in Greenwich.
A leaked letter from the Prime Minister's private office reveals that Prince Philip and the chairman of the museum's trustees, Lord Lewin, the former First Sea Lord and Chief of Defence Staff, were "considerably upset" at the way the National Heritage Memorial Fund rejected the museum's application for millions of pounds from the lottery for the Neptune Hall project.
The leak will provoke a fresh row about the way lottery money is being allocated by the NHMF, which was savagely criticised for paying about pounds 10m to the Conservative MP Winston Churchill for the Churchill papers and pounds 52m to the Royal Opera House.
Prince Philip raised the issue with Alex Allen, the Prime Minister's principal private secretary. Mr Allen then wrote to Hayden Phillips, permanent secretary at the Department of National Heritage. The fact that Mr Major authorised his private secretary to ask the heritage department to investigate shows he is concerned and may feel that Virginia Bottomley, Secretary of State for National Heritage, should act.
The Queen's private secretary, Sir Robert Fellowes, warned in an attached memorandum for Mr Major that the Neptune Hall project - part of a scheme to turn the Greenwich site into a world millennium centre - could be threatened by the NHMF's rejection.
Mr Allen's letter on Downing Street notepaper carries a "restricted" security code, but was leaked to Chris Smith, Labour's spokesman on heritage affairs, and passed to the Independent. Mr Smith said the memorandum by Sir Robert showed a "clear and sorry saga of incompetence" in vetting projects for lottery funds. He defended its disclosure as in the public interest.
"It has taken the intervention from the Royal Family to do something," he said. It will be exploited by Labour in a Commons attack on Thursday on the Government for its handling of the National Lottery.
"Things have come to a sorry pass when it takes the Royal Family to intervene to bring some sense to the lottery process. I don't blame Prince Philip for getting involved. It should not need to happen."
Mr Allen says in the letter to Mr Phillips: "During the Prime Minister's visit to Balmoral over the weekend, the Duke of Edinburgh spoke to me about the Neptune Hall project.
"He and Terry Lewin were both considerably upset by the way the National Heritage Memorial Fund had treated the National Maritime Museum's application. Sir Robert Fellowes subsequently gave me the attached note, which the Duke of Edinburgh has seen. I should be most grateful for your comments and advice."
Sir Robert accuses the fund of basing its decision on reports which showed "ignorance". He dismisses one of the reports on access for the disabled as "a waste of time and money".
The leak will also intensify the row over the Government's plans to privatise the adjoining Royal Naval College at Greenwich, which has also upset members of the Royal Family.
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