Michael Gove refuses to rule out possibility of a Tory donor becoming the next Ofsted chair

The Lib Dems have railed against the Education Secretary's decision to replace Baroness Sally Morgan

Michael Gove has said that he will appoint the next head of Ofsted based upon their suitability for the role (Getty)

Michael Gove faces further clashes with the Liberal Democrats after he refused to rule out the appointment of a Tory donor as the new head of Ofsted.

Speaking on BBC1’s Andrew Marr Show, he said: "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."

Mr Gove emphasised that the appointment would be made solely on merit.

"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," he said.

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 Sally Morgan.

Mr Agnew donated £134,000 to the Tories between 2007 and 2009. In 2010, he was appointed a non-executive director at the DfE. He is a trustee of Policy Exchange and was involved in the setting up of the New Schools Network, the body which has pioneered free schools.

The Education Secretary has been heavily criticised for attempting to “politicise” classrooms, after The Independent revealed on Friday that Baroness Sally would be forced to step aside when her current three-year term as Ofsted chair comes to an end.

David Laws, the Lib Dem Schools minister who was previously close to Mr Gove, let it be known that he is "absolutely furious at the blatant attempts by the Tories to politicise Ofsted".

And Lady Morgan, who was one of Tony Blair's closest allies when he was in No 10, but was appointed chair of Ofsted by Mr Gove, said her removal was part of an "extremely worrying pattern" of non-Tories being replaced by loyal Conservatives in top public posts at quangos such as the Arts Council and the Charity Commission.

The Labour peer told Radio 4's Today programme yesterday: "I think there is an absolutely determined effort from No 10 that Conservative supporters will be appointed to public bodies. I think that is an issue for the Cabinet Secretary to look at. It has been a quiet drip, drip. There is a lot of concern about it. I do think this is coming from No 10 [rather than] individual departments."

However, a source close to Mr Laws pointed the finger at Mr Gove rather than No 10, adding: "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. David's primary concern now is not to let Conservative game-playing destabilise Ofsted, and he'll be working closely with them as Schools minister to make sure that doesn't happen."

Nick Clegg is understood to have raised the issue of party political appointments to public bodies with the Cabinet Secretary, Sir Jeremy Heywood. Lady Morgan, who supported Mr Gove's flagship free schools policy, will step down from her post in the autumn. She insisted she had not fallen out with Mr Gove. Her sacking, revealed by The Independent yesterday, is the latest in an increasingly toxic row involving Ofsted amid rumours that Mr Gove wants to reform the body with tougher inspections.

Sir Michael Wilshaw, Ofsted's chief inspector, last week said he was "spitting blood" over reports that Civitas and Policy Exchange, two think tanks with close links to Mr Gove, were proposing an overhaul of the organisation. Sir Michael suggested that unnamed sources inside the department were involved in negative briefings against him, forcing the Education Secretary to deny that anyone working in his department had done so.

However, a No 10 source said Lady Morgan's suggestion that her sacking was politically driven from Downing Street was "bizarre" and pointed out that she had been appointed by Mr Gove.

A No 10 spokesman said: "Michael Gove has thanked Sally Morgan for her effective and long service as chair of Ofsted. The decision not to reappoint her was his decision.

"This Government appoints people on merit: Sally Morgan was herself appointed under this Government. We have also asked former Labour cabinet ministers to carry out independent reviews on key public policy issues, including Alan Milburn and John Hutton."