Nick Clegg's office has denied the Deputy Prime Minister was involved in any wrongdoing amid claims his aides intervened to help secure £12 million of public money for a charity linked to his wife.
Leaked emails show Matt Sanders, a member of the Lib Dem leader's team, asked for the cash to go to Booktrust, instead of competing with other charities, according to the Mail on Sunday.
In a message to education officials, Mr Sanders referred to the fact that Mr Clegg's wife Miriam had hosted a function for the charity just weeks earlier, the newspaper said.
Other emails reportedly show senior civil servants expressed concern at the way the bidding process had apparently been manipulated in Booktrust's favour.
"There was unease at the way that it appeared Mr Clegg wanted special treatment for Booktrust, and the fact that Miriam's name came up," a Whitehall source told the Mail on Sunday.
A spokesman for the Deputy Prime Minister dismissed the claims as "smears and innuendo" and said the decision to award the cash rested with Prime Minister David Cameron and Education Secretary Michael Gove.
Tory MP Peter Bone is writing to Cabinet Secretary Jeremy Heywood to call for an investigation into the claims while Labour MP John Mann demanded publication of all the emails.
"If there was undue influence over the award of this money, Mr Clegg will have very serious questions to answer," Mr Bone told the newspaper.
"No one is questioning the good work of this charity but I would be very concerned if communications from his office have been used to influence the award of public money.
"There should be a Cabinet Office inquiry and I will be writing to the Cabinet Secretary about this."