THE Diana Memorial Fund is planning to mark the 10th anniversary of the princess’s death by spending £10m of its remaining funds on a campaign to promote the rights of asylum seekers and refugees.

The charity - led by Lady Sarah McCorquodale, Diana’s sister, and which received more than £20m in donations from the public - will also demand an end to the government’s policy of imprisoning child deportees.

The move has led some to question the fund’s suitability as the custodian of Diana’s legacy. It has already lost £13.5m in a bid to stop an American firm making Diana dolls.

The fund is determined to keep alive the memory of Diana as an awkward princess championing unpopular causes, such as Aids sufferers and against landmines, rather than see her deified or smothered by schmaltz.

She was lauded at a Wembley pop concert last month - with performers including Duran Duran and Sir Elton John - and a memorial service is to be addressed next week by Richard Chartres, the Bishop of London, at the Guards Chapel in Wellington Barracks, London.

“If families are going to bring children here, we are right to be concerned about their plight,” said Sir Roger Singleton, chairman of the fund. “The government hasn’t fronted up to the plight of children in these circumstances.”

The campaign will be launched next month after it is agreed by the charity’s board and will lobby for the rights of asylum seekers up to the age of 25. It is expected to finance charities which provide education, housing and healthcare for asylum seekers and will sponsor next summer’s Refugee Week which this year included a touring play called Welcome to Fortress Europe performed by a group of women refugees.

It is also considering paying lawyers to fight Home Office deportation orders targeted at removing young asylum seekers from Britain.

A spokeswoman for Prince William and Prince Harry said they endorsed the fund’s ambition “to support, as their mother did, the vulnerable and marginalised young people in society”.

The fund’s directors want the campaign to transform public antipathy towards asylum seekers and refugees in the way that Diana changed the image of Aids sufferers by embracing them and successfully campaigned for an international ban on landmines.

She proved so influential that ministers in the Conservative government briefed journalists that she was “a loose cannon”.

In her absence, her famous signature will be used prominently throughout the campaign in an effort to persuade the public and the government to think of asylum seekers more positively.

The fund will lobby the government to change the law to end child detention and will finance legal advice to help young imprisoned asylum seekers and their families to challenge the government.

The latest Home Office figures showed 60 children being held in detention under immigration act powers for periods of up to two months. Fifty unaccompanied children seeking asylum arrive every week.

Critics of the scheme have pointed to the fact that the issue of asylum seekers was much less prominent in Diana’s lifetime.

Sir Andrew Green, chairman of Migrationwatch UK, said that the initiative smacked of “political correctness”.

“It’s an unduly political cause for this fund,” he said. “Most asylum seekers turn out to be bogus.”

Lord Tebbit, the former Tory cabinet minister, said: “I suppose the fund will argue that Diana interested herself with people in Third World countries, but I would have thought that there were a good many causes in this country on which money could be spent and, after all, this was her country.”

Singleton said: “We recognise this is not a soft topic and we risk bad press from sections of the media and some political parties. But I would prefer that to explaining why we were not prepared to take on this difficult issue.”

The fund is also planning an annual “heavyweight” event such as a memorial lecture given by world leaders like Bill Clinton and Nelson Mandela.

“If this event can stimulate people to think about how wrongs can be righted in the world, it will do more good than assembling the latest pop groups for a concert at Wembley,” said Paul Hensby, the fund’s head of media campaigns and communications.

He held a similar role at the national lottery’s community fund which was was wound up after criticism that it had funded marginal causes including the National Coalition of Ant-iDeportation Campaigns.

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