"There is information that they have special funding dedicated to the agenda of our colleagues, the PF," Kalumba told Reuters.

The Dutch embassy in Lusaka denied the accusations, saying the NIMD funded all parties in parliament through the Zambia Centre for Interparty Dialogue (ZCID).

"The NIMD does not favour any party over the other and works with all parties in Zambia on an equal basis through the platform of the ZCID," embassy spokesman Joost van Ettro said.

Sata, a gruff populist with strong support among the jobless youth and the poor, narrowly lost the 2008 presidential election to Banda and has since forged an alliance with the United Party for National Development (UPND), the third group in parliament.
In a by-election last week, the MMD lost one of two seats up for grabs to the alliance.

Since mid-2009, the alliance has won three seats in by-elections after the deaths of legislators in MMD strongholds.

Last year, the Netherlands and Sweden froze $33 million in aid for Zambia's fight against HIV/AIDS and other health programmes after it emerged senior officials had stolen $5 million.