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City law firm Slaughter and May was paid more than £22million by the Treasury last year for legal advice on the financial crisis.
Other members of the "magic circle" of top law firms earned another £980,000 of taxpayers' money pushing the total payment above £23 million.
Millions more pounds were paid to investment banks as the Government battled to stop the financial system imploding.
Much of the advice centred on the nationalisation of collapsed bank Northern Rock and rescues of Bradford & Bingley, Royal Bank of Scotland and HBOS.
Slaughter and May was awarded most of the work because other firms were acting for the banks.
It is thought to have charged the Government up to £500 an hour - half the amount it can command from private clients.
Liberal Democrat treasury spokesman Lord Oakeshott said: "This payment is mind-blowing. Even if the financial crisis meant there was no time to shop around at the start for the best deal, the Treasury should then have driven a much harder bargain."
Matthew Elliott, chief executive of the TaxPayers' Alliance, said: "These are vast bills, and taxpayers have a right to know exactly what the work involved.
"Much of these legal fees, and almost all of the nationalised banks' expenditure, has been kept secret despite being funded by ordinary taxpayers."
The Treasury said it needed "the best possible legal advice" to deal with the financial crisis and City minister Lord Myners said certain fees will be recovered from the banks.
A Treasury spokesman added: "Wherever possible the Treasury operates an open and competitive process when it procures the services of any external expert or company. There can be exceptions in the case of urgency."
Reader views (1)
WHY give £23,000,000 of taxpayer's cash to parasite lawyers?
THERE ARE MORE THAN ENOUGH QUALIFIED LAWYERS FALLING ASLEEP IN THE HOUSE OF CONMEN - JACKBOOT STRAW FOR STARTERS.
THIS GOVERNMENT CERTAINLY KNOWS HOW TO TAKE JOE PUBLIC FOR A RIDE.
- Reuben Camara, Republic of Morecambe, UK, 24/06/2009 14:34
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