David Cameron set up the Leveson Inquiry into the press to divert attention away from his decision to hire disgraced former News Of The World editor Andy Coulson into his Downing Street team, a former Scotland Yard commissioner has said.

Sir Paul Stephenson, who resigned from the Metropolitan Police at the height of the phone hacking scandal over his links to former NOTW executive Neil Wallis, said the Prime Minister had an agenda to "spread the heat around".

Coulson was forced to resign as No 10 director of communications and was later jailed for conspiracy to hack phones.

The claim is the latest in a string of allegations made in a biography of Mr Cameron by former Tory donor Lord Ashcroft and journalist Isabel Oakeshott.

In the latest extract of Call Me Dave published in the Daily Mail, Sir Paul said: "I think they deliberately spread it wider to try to take the flak away from the decision to employ Coulson.

"I think there was a very strong agenda there to spread the heat around."

The book also alleges that former NOTW editor Rebekah Brooks - a friend of Mr Cameron - may have influenced the PM to launch the inquiry in an effort to spread the blame for phone hacking around the British press.

A separate extract claimed Cabinet Secretary Sir Jeremy Heywood and the Queen's private secretary Sir Christopher Geidt held talks to discuss how the monarch could express her alleged concern about the UK breaking up in the run-up to last year's Scottish independence referendum.

Days before the vote, the Queen was overheard saying, "I hope people will think very carefully about the future" while on a visit in Scotland.

Lord Ashcroft's book has already caused embarrassment for Mr Cameron with allegations that he took part in a bizarre student initiation ceremony involving a dead pig and a "private part of his anatomy".

Sources close to the Prime Minister have insisted they did not recognise the claims.

The peer - who gave the Conservatives £8 million while they were in opposition - angered many Tories after he disclosed that he decided to write the book when Mr Cameron refused to give him a significant ministerial job following the 2010 general election.

Mr Cameron was with the Queen at Balmoral, her residence in the Scottish Highlands, last September when a shock opinion poll put the pro-independence campaign in the lead in the run-up to the Scottish referendum.

According to the book, Mr Cameron's pollster Andrew Cooper said that "around six months before the September referendum his usual sangfroid had deserted him and he'd started having sleepless nights".

One confidant told the authors that Mr Cameron feared "being remembered for this till the day I die" if Scots had voted to leave the UK while he was in Number 10.