The Sketch: Labour sniffs a scandal as Tories twist the knife into ailing steel firm

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There's no specialist underwear involved but Labour feel that they now have something in the Coalition that they can expose for our salacious pleasure.

The amateur spirit of the Government has created a number of irregularities and embarrassments, but nothing to create the sense of sleaze so highly valued by an opposition.

In the last 10 weeks we've had... the loss of a minister to expenses, non-dom peers quitting the Lords, multiple errors in the school building lists, the U-turn on capital spending after the Budget, the busted claim that fiscal realities weren't available before the election, the accusations of impropriety in the Mandelson money promised to various interests being scuppered by a permanent secretary's letter, Nick Clegg's "personal view" on the legality of the war, the ramming-through of the Finance Bill and now the Academies Bill... All these incidents and accidents are in the process of coming and going but none of them have left much of a stain in the public's mind.

Will Sheffield Forgemasters do the trick? It's unlikely but Labour had their hopes as they peppered the Leader of the House with questions yesterday.

Jack Straw had majored on it at PMQs but the narrative didn't come through in the dogfight. The story concerns the £80m loan promised to the Yorkshire steel company and how it was withdrawn by the Coalition, who said it was "unaffordable". They also said the current management didn't want their shareholding diluted by the new capital.

The plot has enjoyed a number of thickening agents in the last couple of days. First, Nick Clegg admitted in correspondence that the directors actually were willing to countenance a dilution of their shareholding.

Second, a letter has come to light showing the source of this idea (that the directors wouldn't want to have their shares diluted). It was written by Andrew Cook, a substantial Tory donor, and a gentleman who seems to have ambitions to take over the company himself.

MPs spent a third of Business Questions on it and managed to hammer the details into something that can be weaponised. Viz,a Tory donor was instrumental in blocking a life-preserving loan to a company he wanted to take over himself.

That's the story Labour need to stand up, if it's to work – and they have to do so before Monday when Nick Clegg comes again to a Commons question time.

It's promising raw material. Ministers were involved. How much and to what end? Who knew what when? Were officials involved?

But it probably won't come to a full scandalous conclusion. The Sheffield management do suggest on their website that private investment is available but the terms on which it's offered aren't "fair". That is, not as fair as an £80m loan from the taxpayer. Er, no. Nothing's as "fair" as that.

PS: The best phrase to have come out of the Academies Bill this week is from Ed Balls: if the state doesn't do it "who will police social cohesion"?

Roll that phrase around in your mind a little, and consider the actions of the state policing social cohesion. What a world view, what a mindset that remark reveals. The monitoring, the enforcement, the penalties, and God knows, the outcome.