DAVID Cameron has hit back in the feud with Tory donor Lord Ashcroft as George Osborne rallied behind his leader over denied allegations of drug-taking and debauchery during the Prime Minister’s student days at Oxford University.

As more revelations were published from the peer’s biography of the Conservative leader, including an attack on the PM by former military chiefs, it emerged that Mr Cameron had taken a humorous pot-shot at the billionaire businessman.

Addressing a fundraising dinner at the Carlton Club, he recounted a story about having visited a doctor earlier in the day to get treatment for a bad back.

The surgeon told the PM that he would give him an injection, saying: “’This will just be a little prick; just a stab in the back.’” Mr Cameron then quipped that it had “rather summed up my day”.

In response, Lord Ashcroft tweeted: “Good to see PM retains his sense of humour. We must have the same doctor. I had the same in 2010 when the PM reneged.”

This was a reference to the peer’s claim that Mr Cameron had offered him a substantial ministerial post following the tycoon’s largesse of several million pounds, which effectively kept the Tory Party afloat following its landslide defeat in 1997. However, when the Coalition Government was formed in 2010, the PM only offered Lord Ashcroft a minor role, which he declined to accept.

Mr Cameron’s response to the claims in the biography, Call Me Dave - which include his alleged participation in a lurid initiation ceremony involving a pig’s head - are his first albeit humorous riposte to them. Earlier, Downing Street made clear it would “not dignify” the allegations with a comment but Tory sources dismissed all the claims as "absolute nonsense" and a clear act of revenge by the Tory peer.

The Chancellor, currently on a trade mission to China, was asked if his colleague had been damaged by the revelations, to which he replied: “The British people had their verdict on David Cameron's premiership just a couple of months ago at the General Election and they re-elected him because he is a strong leader who has led this country out of economic turmoil to economic success.

"Britain is walking tall on the world stage again and (I'm) frankly not going to dignify that book with a more detailed response," he added.

In the unauthorised biography, the PM was condemned for his "incompetent" response to turmoil in Libya and Syria with one ex-forces’ chief accusing him of relying on his experience in the "Combined Cadet Force at Eton".

Baron Richards, who was Chief of the Defence Staff until 2013, said: "Our instinct is knee-jerk support for the underdog, without doing the analysis that would necessarily legitimise that course of action."

There are reports of fury in US President Barack Obama's team about the Tory leader's failure to win Commons support for bombing Isis in Syria.

Sources told Lord Ashcroft and his co-author, journalist Isabel Oakeshott, that the White House considered it had been "****ed over" on both Libya and Syria.

The book also alleges Mr Cameron had a "derring-do" plan to take out Syrian President Bashar Assad, which senior figures argued "would have been getting everybody into deeper waters".

Former Shadow Defence Secretary Michael Ancram, the Marquess of Lothian, said the UK's military intervention in Libya, which helped bring down Muammar Gaddafi, had turned the country into a hotbed for extremists.

"We now have a country which is ungovernable...with vast amounts of weapons from Gaddafi's arsenal moved south of the border, arming Boko Haram (extremists in Nigeria)," the Scots peer said.

Meantime, the PM is facing renewed calls from the SNP and Labour to clarify when he was told that Lord Ashcroft held "non-dom" status, which allowed him to avoid paying UK tax on his worldwide income.

Mr Cameron said he only found out about the peer’s tax exile status a month before the 2010 General Election but Lord Ashcroft claims he informed him several months earlier in 2009.

Nicola Sturgeon, the First Minister, has insisted the PM now has “a duty” to clarify the position.