Lib Dems demand 'impartial' selection for new Ofsted chair after Michael Gove is accused of attempting to undermine chief inspector

Education Secretary Michael Gove delivers a speech on education reform at the London Academy of Excellence in East London (PA)

Michael Gove faced new allegations that he is undermining Sir Michael Wilshaw, the Chief Inspector of Education, as Liberal Democrats demanded a “totally impartial” selection process for the new chair of the schools inspectorate.

Some senior civil servants believe Mr Gove’s controversial decision to dismiss the Labour peer Baroness (Sally) Morgan as chair of Ofsted is part of an attempt to install a new Chief Inspector more sympathetic to his own views.

Last month the Education Secretary was involved in an unusually public dispute with Sir Michael, who said he was “spitting blood” about newspaper reports that Ofsted might be reformed or scrapped.

Although the two men cleared the air at a meeting, Mr Gove’s plans for Ofsted are now the subject of intense speculation in Whitehall following his decision not to renew Lady Morgan’s three-year contract.

One politically neutral official said: “There is a feeling that this is about getting a chairman who will destabilise Sir Michael Wilshaw in the hope he will walk away. He [Mr Gove] can’t sack him. But a new chairman could make life difficult for him.”

Allies of Mr Gove dismissed the Whitehall speculation, saying Lady Morgan’s departure was totally unconnected with Sir Michael’s recent remarks. Yesterday Mr Gove heaped praise on Sir Michael, saying: “We are blessed to have an outstanding chief inspector of schools... From the moment of his appointment he has been setting higher standards.”

David Laws, the Liberal Democrat Schools Minister, who is furious about the decision to oust Lady Morgan, held talks with Mr Gove about the affair yesterday. Mr Laws told him the panel appointing a new Ofsted chair must be “totally impartial” because of the controversy.

He rejected Mr Gove’s suggestion that the panel could be chaired by Paul Marshall, a Lib Dem donor and member of the Department for Education’s board.

A senior Lib Dem source said: “David and Michael had a constructive meeting this afternoon and agreed to work on together on a process going forward – including choosing and agreeing together the make-up of the appointment panel.”

Speculation grew that Mr Gove would like to install Theodore Agnew, a Tory donor and champion of academy and free schools, as Ofsted chair. “I think it would be a pity if this kerfuffle in the media prevents him from applying,” said Nick Gibb, the Conservatives’ Schools Minister from 2010 to 2012. “All applicants have to apply and go through the process. He is very well qualified to take the position, to apply for the position.”

Mr Agnew is a trustee of Policy Exchange, set up by Mr Gove in 2002, one of two right of centre think tanks said to be considering Ofsted’s future – a move which alarmed Sir Michael.

Mr Gove insisted that Lady Morgan could be succeeded by a member of the Revolutionary Communist Party or a political party donor. He said all candidates for the post would be interviewed by an independent panel which “by definition would make its recommendation free of any information about the political views or background of the candidate”.

The Education Secretary said: “A Revolutionary Communist Party or someone who has been generous enough to support a political party with their hard earned cash - if that person is the right person, they will be appointed.”

Mr Gove added he would have the power to veto or endorse the chosen candidate at the end of the day. But the Lib Dems are demanding a veto because of Lady Morgan’s sacking.

The Education Secretary rejected suggestions by Sir David Bell, his former Permanent Secretary and Chief Schools Inspector, that he was surrounding himself with “yes men”, insisting his department was not “a gallery of nodding dogs”.

Civil servants often said “yes, no, maybe” to his ideas and could be heard sucking their teeth at some his suggestions, he said. “There are a number of occasions when I’ve acknowledged that I’ve bitten off more than I can chew,” he added. He had responded to “constructive criticism” of his GCSE reforms - particularly an original suggestion that there should be just one single exam board for each subject. “I think it had a lot of merit but the practical concerns were extensive and Ofqual [the exams regulator] told me it wasn’t a runner.”

Lord Adonis, the minister who founded the academies programme during the Blair Government, said Lady Morgan should be reappointed to preserve Ofsted’s “independence and integrity".