Public health minister Tessa Jowell is fighting Treasury resistance to a financial rescue plan drawn up for a leading HIV/AIDS centre.

Managers offered to make a£715,000 interest-free loan to keep residential services at London Lighthouse open until September.

The loan was part of a deal agreed between Kensington & Chelsea and Westminster health authority, London Lighthouse managers and the Department of Health in March.

The deal included Lighthouse's controversial decision to sell its purpose built centre for people with HIV/AIDS after the withdrawal of£1.7m of NHS funding for residential services this year.

Publicity surrounding the deal is understood to have led to KCW chief executive John James being called in to justify the loan to Treasury officials.

A paper presented to the HA's board meeting yesterday points out that Treasury agreement is needed before an HA can make a loan. The paper added that, since the agreement had been reached that KCW would provide a bridging loan until the Lighthouse building was sold, the Treasury had asked for 'a fully worked up business case' in order to be satisfied that the loan would be properly secured.

The necessary figures were being prepared for submission to the Treasury before Easter, the paper said.

Meanwhile, revised figures showed that Lighthouse would still have had cash in hand at the end of March.

Ms Jowell, who backed the rescue plan drawn up by managers, is expected to make a statement on Lighthouse this week in response to a question from local MP Karen Buck.

The business case will be presented to the Treasury by NHS chief executive Alan Langlands and Mr James as 'accountable officer' for the DoH and the local HA respectively.