At a swish Westminster reception to promote a new book about Nigel Farage this week, one subject dominated the conversation over the sparkling English wine and canapes.

To the consternation of Farage supporters, all the talk on Tuesday night – two days before the Makerfield by-election – was how Reform UK had already lost the seat they had once seemed nailed on to win.

The scale of their third by-election defeat in a row in a constituency in which they won every seat, with 50 per cent of the vote to Labour’s 27 per cent, in last month’s council elections has sent shock waves through Farage’s party, which has an 11 per cent national lead over Labour.

Farage’s people thought they could win Makerfield, as the 32 per cent they polled there in the general election was their sixth best result in the country.

‘Makerfield was a dream seat for Reform and we blew it,’ one party insider told me. ‘Again.’

At the Westminster event – the launch party for Lord Ashcroft’s biography The Farage Factor, serialised last weekend in the Mail – Reform supporters were dismissive of the threat from Rupert Lowe’s Restore Britain, which was only registered as a political party by the Electoral Commission in March.

A defiant Farage told me he considered placing a large bet on Lowe’s party losing its £500 deposit. If he had, he would have lost his money. They polled a respectable seven per cent of the vote in third place.

An inquest is already under way at Reform HQ, with the candidate-selection process a major part of the review – Robert Kenyon, a plumber and newly elected local councillor, was a gaffe-prone disaster.

Even a cursory glance at his social media output would have revealed a series of misogynistic rants and a post in which he endorsed a sexually explicit social media item about TV presenter Carol Vorderman.

There were also embarrassing comments about abortion, female rugby players and Ukraine.

Perhaps most perversely of all, it emerged that Kenyon backed Remain in the 2016 Brexit referendum in a constituency which voted 65 per cent in favour of Leave. The polling agency More In Common said Kenyon had a minus 19 per cent favourability rating and reinforced the party’s continuing problem in attracting women voters.

Sceptics argue that if Reform can’t conduct effective due diligence into the background of the man they were putting up to contest one of the most high-profile by-elections in modern political history, how can they possibly be expected to find 650 credible candidates to stand at the next General Election?

Even some of the party’s most senior figures indulged in unseemly bickering over policy as the Makerfield campaign descended into farce.

Robert Jenrick, a high profile defector from the Tories, and Zia Yusuf, the party’s home affairs spokesman, had a very public falling out over the party’s deportation policy. Yusuf also provoked derision at the end of last month for arguing on X that Tory MPs, ‘who created the burning injustice of modern Britain’, are ‘traitors to their country’.

Given that five of the eight members of Reform’s parliamentary party are former Conservative MPs, including Jenrick and Suella Braverman, an ex-Home Secretary, this was a highly provocative remark.

There is concern, too, about the party’s ongoing status as something of a one-man band.

While it has attracted two former Cabinet ministers, neither of them have anything approaching Farage’s star quality. And the normally irrepressible Farage was unusually camera-shy during the Makerfield campaign.

Aside from an emergency 10-minute YouTube statement on the Henry Nowak murder in Southampton and a brief appearance in the Commons to criticise two-tier policing, he avoided the spotlight.

Why? I’m told the reason is that even Farage loyalists believe he’s in serious political trouble over a £5million gift from the Thai-based crypto billionaire Christopher Harborne. Farage received the secret gift weeks before announcing he would stand as a candidate in the 2024 General Election and so it could be said to be covered by the rule that requires MPs to declare any potentially relevant donations received in the 12 months before they entered parliament. Farage insists the donation was intended to cover his personal security, which costs more than £1million a year, and therefore did not need to be declared.

But Daniel Greenberg, the parliamentary commissioner for standards, is investigating the £5million payment under the code of conduct obliging MPs to ‘fulfil conscientiously’ requirements relating to their registration of interests.

If he finds Farage guilty, the 14-strong standards committee, which has seven lay members plus four Labour MPs, two Tories and one LibDem, will decide whether to suspend Farage from parliament. If the suspension is longer than 10 days, it could trigger a by-election.

Reform is confident that it would not only win any such by-election but with a bigger majority than the 8,400 Farage secured in Clacton at the last election.

‘We would fight it as another Establishment plot to try to get Nigel,’ one of his supporters told me shortly before the voting closed in Makerfield.

‘I’ve already heard Labour MPs are lobbying for Farage not to be suspended.’ But Harborne, the man who stumped up the cash, himself muddied the waters over the £5million donation when he said he gave the money ‘because of my great admiration for the decades of work he had done to achieve Brexit’.

And Farage’s cause is not helped by the fact he has proposed a reduction in capital gains tax on crypto assets and the creation of a Bitcoin reserve fund at the Bank of England, both measures that would potentially be of benefit to Harborne.

Farage’s lifestyle is another source of concern for some of his supporters.

He has never made any secret of the fact he is a smoker who enjoys a ‘PFL’ or ‘Proper F***ing Lunch’, something defined in Lord Ashcroft’s new biography as involving the participants drinking two bottles of wine each.

In addition, at the age of 62, he keeps to a punishing schedule of early mornings and late nights that would test the stamina of a man half his age.

In such a context, Reform would be wise to have a succession plan in place but it gives no sign of being prepared for an orderly transfer of the party leadership should Farage have to step down.

Meanwhile, Restore – which now has 130,000 members – is proving a thorn in its side.

While Reform failed to come within striking distance of Andy Burnham, Restore – which calls for the mass deportation of non-white migrants and a ban on the burqa – dented its campaign with an unexpectedly strong performance.

Restore also won the social media war even though Farage has 2.2million Facebook followers compared with Lowe’s 1.3 million. Angry at being outclassed by Lowe’s novice outfit, I can reveal Farage has ordered his team to conduct a thoroughgoing overhaul of Reform’s social media operation.

To this end, Reform recently rented a second floor at its Westminster HQ in Millbank Tower, once the home of Tony Blair’s New Labour operation.

A senior party figure told me: ‘There will be more social media whizz kids hired to work on those two floors to revamp our Facebook offering.’

Meanwhile, the Tory leader Kemi Badenoch is looking stronger by the day. There are even Westminster whispers that Restore is working with the Tories against Reform.

It is telling that the Conservative Party leadership allocated one of its designated seats on the Public Accounts Committee to Rupert Lowe, and Restore did not put up a contender to the Tories’ victorious candidate in Thursday’s Aberdeen South by-election.

Could it be that the Makerfield result will go down in history as the day Reform’s bubble burst?