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Church Commissioners have been accused of a “profound failure of judgment” over a £100million slavery reparations scheme.

Tory Shadow Home Office Minister Katie Lam, tore into the project – known as ‘Spire’ – telling the Daily Express it was the work of “a Church leadership gripped by ideology and detached from legal and historical reality”.

The fund, officially known as the Fund for Healing, Repair and Justice, was set up after Church Commissioners said their historic endowment, the Queen Anne’s Bounty, had profited from slave-trading.

But historians dispute the claim, which has led to a feud between Church leaders and campaigners.

Church officials have pledged to invest £100million over nine years, with the ultimate ambition of building a £1billion fund for reparative justice.

The scheme has sparked fury from MPs and campaigners who say cash meant for parish churches is being diverted to a politically driven project.

Ms Lam said: “Money intended to support priests and parishes should not be diverted into a politically fashionable reparations scheme built on discredited research. The Church appears to be trying to rewrite the rules governing charitable funds by the back door.”

She added: “Worse, it is pressing ahead despite the overwhelming majority of Anglican churchgoers wanting this money spent on local churches, not slavery reparations.”

Ms Lam said the Church should “abandon Project Spire and return to its core mission of supporting parishes, serving communities and preserving the institutions entrusted to its care”.

But Commissioners hit back, branding her criticism “the same false claims we have corrected time and again” and insisting: “We stand by our research […] the facts could not be clearer.”

It comes after MPs and peers wrote to the Archbishop of Canterbury, Dame Sarah Mullally, in December urging her to halt the fund – she refused to do so.

The Church is also facing a legal challenge over the scheme, with critics from groups including Save the Parish and History Reclaimed disputing the historical research underpinning it.

Professor Richard Dale, a historian, slammed the “narrative propagated by Church leaders” to justify Project Spire as “demonstrably false”.

He said that there was “incontrovertible evidence that Queen Anne’s Bounty’s investments earned not one penny from the slave trade.”

In a brutal takedown of the scheme he said that the Church, and their advisors had “deluded themselves and misled everyone else.”

The Church of England says the fund will not make direct payments to descendants of enslaved people, but will instead distribute grants to businesses and community projects.

It insists no diocese will be worse off financially as a result of Project Spire, and that the funding comes “from the Church Commissioners’ income from its assets, not from donations made by parishioners, which are not affected in any way”.