Mayor of poverty-hit council hires adviser in £1,000-a-day deal

Tony Winterbottom is an "executive adviser" on regeneration and development to Lutfur Rahman, the mayor of Tower Hamlets who was ousted from the Labour Party over alleged links to Islamic extremists.

Local government secretary Eric Pickles accused Mr Rahman of wasting taxpayer money. He said: "It is astonishing that one of the poorest boroughs in the country sees fit to squander such colossal amounts of public cash in this way.

"Tower Hamlets seems to be living the ultimate champagne socialist lifestyle, leaving taxpayers to pick up the tab. I fail to see the business case for shelling out this money, which should be diverted towards protecting frontline services."

Tower Hamlets has the worst child poverty in the UK, with 52 per cent of children below the breadline. Campaigners warned planned £70 million cuts to the local budget could cause an "economic and social disaster".

Mr Winterbottom, 67, insisted he was not overpaid and was "embarrassed to be charging so little".

Jim Fitzpatrick, Labour MP for Poplar and Limehouse, said: "At a time when Tower Hamlets is being buffeted by cuts from central government, every penny is precious and a £1,000-a-day contract seems to be way over the top." London Mayor Boris Johnson said: "I'd better investigate the circumstances but it sounds like a lot of money to me."

A former adviser to Labour mayoral candidate Ken Livingstone, Mr Winterbottom won the contract to advise Mr Rahman last October. An investigation by the Evening Standard found the £1,000-a-day deal is with LDP Projects, run by him and his wife, Kathleen, based at his home in Aston Clinton, Buckinghamshire.

The consultant works three days a month for Tower Hamlets.

Emma Boon, campaign director of the Taxpayers' Alliance, said: "Deals like this for consultants should not be allowed at a time when the rest of the public sector is taking a pay freeze."

Mr Winterbottom was previously a senior official at the defunct London Development Agency. He was criticised in 2008 after he left on a year's sabbatical, followed by a £75,000 pay-off and £160,000 top-up to his pension fund. An investigation into the LDA, ordered by Boris Johnson and headed by former financial journalist Baroness Wheatcroft, found a string of failings including "ineptitude" and "massive misspending".

Mr Rahman became the first directly elected mayor of Tower Hamlets in 2010. He originally stood as a Labour candidate, but was deselected amid claims about his links with fundamentalist group the Islamic Forum of Europe (IFE). He has denied the allegations. He won the poll as an independent backed by Mr Livingstone, and controls a £1.3 billion budget.

Mr Winterbottom, who has also advised Tottenham Hotspur on stadium development, said: "I'm embarrassed the Standard knows I am charging so little. My company has done work in the private sector for a lot more than £1,000 a day."

He claimed he would not ask for the full amount: "I tendered a bid for £1,000 a day. In reality, I get paid £125 an hour but I have not yet put in an invoice. I wanted them to respect me as an individual so I asked them to pay me a proper price but I'm not going to charge them.

"I'm absolutely squeaky clean. This is not a money-making operation. This is about fighting for Lutfur Rahman who's trying to do good work."

A Tower Hamlets spokesman said: "We do not comment on payment of individual employees unless the information is on the council website as part of our responsibility towards transparency."