Trustees stand by Diana fund

Fund: accused of cheapening Diana's name

Trustees of the Diana, Princess of Wales Memorial Fund have rejected calls to wind up the charity after reports of a scathing attack by Earl Spencer.

The Princess' brother has reportedly told the nine trustees he wants to see the "tasteless and degrading" fund closed by the third anniversary of her death, August 31, 2000.

The Times quoted an unnamed aide to the Earl as saying the Spencer family was increasingly concerned about the aims of the fund - which receives £1m a week - and some of the activities it is involved in.

But despite this latest row, which follows controversies over the use of Diana's name on lottery scratchcards and margarine tubs, the trustees, who include the princess' sister, Lady Sarah McCorquodale, said they would continue their work.

Diana: Brother wants fund wound up by 2000

Christopher Spence, speaking for the trustees, admitted Earl Spencer had written to Anthony Julius, Diana's former solicitor and another trustee, to express concerns about the fund.

However, he denied they had received a demand to wind up the charity. "There is discussion going on between the trustees and family about how we can arrive at a situation where all parties agree on what should be done," said Mr Spence.

"There has been no discussion on when we should close the fund.

"There will be discussions in the next few weeks about the strategic direction of the fund, of which the issue of how long the fund exists for will be a part."

The row comes after the trustees said they had to temporarily stop taking applications for grants because they had been deluged with requests.

The fund, which it is thought will soon top £100m, needs an overhaul of its procedures and grant-making policies, the trustees said.

It has so far given £13m to 100 organisations but trustees will not authorise any more grants until after the review is completed in late summer.

Flora: Special deal to carry Diana's name

The fund was first criticised when trustees allowed margarine company Flora to use Diana's name on its tubs in a one-off deal worth £250,000.

Former Prime Minister John Major, appointed as a guardian to Princes William and Harry, criticised the fund in the wake of that decision.

He called for trustees to show "care, consideration and sensitivity" over the use of Diana's name.