According to the Daily Telegraph the arrangements involving SLC chief executive Ed Lester could reduce the amount of tax he pays by ?40,000 a year.

The claims are due to be set out in detail by Newsnight tonight, the newspaper says, adding that the deal was apparently signed off by David Willetts, the universities and science minister, who said in a letter that it had been ¡°agreed by the Chief Secretary to the Treasury¡±, Danny Alexander.

Mr Lester was hired as interim chief executive of the SLC in May 2010 following a leadership crisis at the organisation.

His appointment was made permanent in December that year.

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The Telegraph reports that he is paid a basic salary of ?140,000 a year, with other benefits taking his total remuneration to a maximum of ?182,000.

Mr Alexander has now written to all government departments asking whether other public sector workers are paid the same way.

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A spokesman for the SLC said Mr Lester¡¯s pay deal was cheaper for the taxpayer than when he had originally been hired on an interim basis.

The company had ¡°followed all government guidelines on [his] appointment and remuneration¡±, the spokesman added.

john.gill@tsleducation.com