Philip Webster's analysis | Tebbit's warning to Osborne | Drinks, dinners, differing accounts | The witness | Alice Miles: comment | Peter Riddell: briefing | Rachel Sylvester: analysis | Questions for Mandelson | Sketch | Osborne chronology and Rothschild reply | Rothschild fundraiser on hold | Hellraising for the super-rich | Animal analogies: give us yours | Poll: would you vote Tory? | Yachtgate: where Osborne and Rothschild differ

Gordon Brown called today for an official investigation into allegations that George Osborne, the Shadow Chancellor, solicited what would have been an illegal donation from a Russian oligarch while on holiday on Corfu this summer.

Mr Brown was pulled into the row at Prime Minister's Questions, when the combative backbencher Dennis Skinner jokingly urged him not to get involved with any Russian billionaires.

He was unexpectedly direct in his reply - apparently savouring the chance to get back at the man who used to shadow him him in the Commons and had once labelled him "faintly autistic". He told MPs: "This is a very serious matter indeed and I hope it is investigated by the authorities."

Yachtgate: where Osborne and Rothschild differ

Five key questions remain unresolved over allegations that Conservatives solicited a donation from Russian billionaire

• A witness with impeccable Wall Street credentials

• Drinks, dinners and differing accounts: a weekend on Corfu

• George Osborne on the rack over new donation allegations

BACKGROUND

• Oleg Deripaska - oligarch at centre of storm

• Hellraising for the rich: how Osborne met Rothschild

• Osborne's chronology and Rothschild's reply

Multimedia

• Osborne and the oligarch

Related Links

• Analysis: Bringing the House down

• Tory grassroots: 'Osborne should resign'

• Yachtgate: where Osborne and Rothschild differ

Multimedia

• Poll: would you vote Tory?

• Comment Central - give us your animal analogies

Mr Osborne has denied an allegation from his erstwhile friend Nathaniel Rothschild, made in a letter to The Times and published yesterday, that he and Andrew Feldman, the Conservative Party chief executive, solicited a £50,000 donation from Mr Deripaska in various meetings on the Greek island this summer.

It is against the law to accept political donations from foreigners but the Electoral Commission, which polices party funding laws, may refuse to get involved because no donation was made. The Labour MP Tony Wright, who chairs the Public Administration Select Committee, also said he saw no need for an investigation - unless it was an internal Tory one - because no laws had been broken.

But the Labour backbencher Denis MacShane, who suggested that Mr Osborne may have broken the law by acting to facilitate what would have been an unlawful donation, made the first move to force an inquiry.

This afternoon, Mr MacShane wrote to Mr Osborne saying that there were likely to be questions for the Electoral Commission to investigate and asking him a series of questions about the events in Corfu and his own role in them.

In response, the Conservatives accused both Mr Brown and Mr MacShane of "a desperate attempt to keep this story going". A spokesman said: "All the questions raised in Denis MacShane’s letter are dealt with in yesterday’s statement from George Osborne and Andrew Feldman."

Mr Osborne, who has worked alongside David Cameron to engineer his party's revival, yesterday gave a detailed account of his meetings with Mr Deripaska on the Greek island. "We didn't ask for any money. We didn't receive any," he said.

But Mr Rothschild, apparently stung by Mr Osborne's betrayal of his hospitality with his earlier indiscretions about Peter Mandelson, stood by his claims. He asserted last night that James Goodwin, one of the guests at his Corfu villa, was present when he, Mr Osborne and Mr Feldman discussed a possible donation by Leyland Daf, a British company controlled by Mr Deripaska.

Mr Rothschild said that the discussion continued once the party arrived on the Queen K, Mr Deripaska’s yacht.

Mr Rothschild issued his statement at 9pm in what appeared to be an escalation of hostilities with his old friend from Oxford. In it, he directly contradicted Mr Osborne’s account that there had been no discussion of channelling donations through a British company.

He went on to say that his witness, Mr Goodwin, recalled that the subject of a donation arose briefly after they went to the Russian’s yacht "but the conversation gained no traction".

Mr Goodwin is a former adviser to President Clinton and a prospective non-executive director of Rusal, Mr Deripaska’s aluminium company, Mr Rothschild added that at dinner later that evening the donation was again talked about "and Mr Osborne was interested in whether and how such a donation could be secured".

Tory party officials said today that neither Mr Osborne nor Mr Feldman planned to sue over the allegations, to avoid a "messy" court case in the run-up to the next election. "They know politics is a controversial business and they are pretty relaxed about it all," one said.

Mr Osborne had said in his statement that "there was no discussion about how a donation by Mr Deripaska could be concealed or channelled". Later, a spokesman said that Mr Osborne denied absolutely "any new recollections from Mr Rothschild".

Even before Mr Rothschild’s statement, the affair had provoked huge embarrassment for the Conservative leadership, with Tory MPs raising questions about Mr Osborne’s judgment in allowing himself to become embroiled in questions about funding.

Grassroots Tories were equally angered by what many saw as an unnecessary distraction.

David Lumgair, a councillor in Angus, set Mr Osborne a deadline: "As of today his reputation is very tarnished. If this speculation is still going on by Friday, he should resign for the good of the Tory party."

Mr Osborne also received scant support from the party's Thatcherite old guard, however, including the former party chairman Lord Tebbit, who reminded him that "those who sleep with dogs will get fleas".

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