Dozens of civil servants paid £1,000 a day under secret arrangements to avoid tax

Some of the most senior officials in Whitehall receive a total of up to £4m funnelled through private companies or other intermediaries, making it impossible to tell whether they had paid the full amount of tax, a review found. Ministers announced that in future senior staff must be on the government payroll to ensure they are paying the correct income tax and National Insurance, or their contracts will be terminated. The highest paid “off payroll” official was believed to have worked as commercial director for the High Speed 2 rail project, earning up to £1,799 per day. Danny Alexander, the Treasury chief secretary, said a new law was being drafted to require anyone controlling any public or private organisation to be on the payroll. He ordered the review after it emerged in February that Ed Lester, the head of the Student Loans Company, had negotiated a deal to be paid through a private company which allowed him to avoid tens of thousands of pounds in tax.