The Home Office has been fined £366,900 for breaching the government’s senior salary pay cap when it appointed the head of a child sex abuse inquiry.
It was penalised by the Treasury for failing to get clearance in advance before agreeing to pay Professor Alexis Jay £185,000 a year.
Since 2010, all jobs with salaries of more than £142,500 agreed by ministers have had to be signed off in advance.
The Home Office said it had reviewed procedures to avoid future breaches.
Prof Jay became the fourth chair of the troubled inquiry after replacing Lowell Goddard in August 2016.
The fine also relates to the pay of the inquiry’s three panel members one of whom, Drusilla Sharpling, received a basic salary of £152,424 in 2015-6.
On becoming chancellor in 2010, George Osborne ruled that public servants directly appointed by ministers should not be paid more than then Prime Minister David Cameron – who was earning £142,500 at the time – unless they were approved by the Treasury.
It was part of an austerity drive which saw the pay of ministers cut by 5% and then frozen for five years.
Prof Jay was named as chair by Home Secretary Amber Rudd at short notice in August 2016. Her predecessor, a leading New Zealand judge, resigned suddenly following criticism of her conduct of the troubled inquiry.
The inquiry is investigating historical allegations of sex abuse against local authorities, religious organisations, the armed forces and public and private institutions – as well as people in the public eye – spanning decades.
The leading academic and child protection expert was already a panel member, working in that capacity alongside Ms Sharpling, barrister Ivor Frank and academic Professor Malcolm Evans.
Details of the “exemplary fine” emerged in the Home Office’s accounts for the past financial year.
A Home Office spokesman said the department had been punished for having to secure “retrospective approval” for Prof Jay’s salary when she became chair as well as the remuneration of other panel members agreed when the inquiry was set up in 2015.
“The Treasury has the power to consider fines for departments who breach agreed spending control processes, including those relating to senior salary approval,” it said.
“The Home Office have since reviewed appointment procedures to prevent further such breaches.”
The Home Office said Prof Jay had been appointed swiftly in order to minimise disruption to the inquiry and this meant getting sign-off for her salary “in parallel” with her appointment – which was subsequently approved.
According to the inquiry’s accounts, Prof Jay was paid £118,360 for the period from 18 August 2016 to 31 March 2017. She also received an £27,478 accommodation allowance and expenses of £2,281.
She also received £34,465 for her work as a panel member during the first four months of the financial year before becoming its chair chair.
The accounts show Ms Sharpling was paid £152,285 in 2015-6, rising to £154,423 in 2016-7. The inquiry has agreed to subsidise 80% of what she was earning in her previous capacity as Her Majesty’s Inspector of Constabulary.
Over the same period, Prof Evans was paid £65,540 while Mr Frank received £96,332,50. In the past financial year, these salaries – which are set at a fixed rate of £565 a day – rose to £76,840 and £138,990 retrospectively.
The Home Office stressed the fine did not relate to Dame Lowell Goddard’s remuneration arrangements, which were heavily criticised during her 16 months in the post, but for which officials said “all the necessary approvals” had been granted.
In 2015-6, she was paid £355,000 and received an accommodation and utilities allowance worth £119,207. She also received £29,156 in relocation costs and £75,246 in travel costs including the cost of air fares between the UK and New Zealand.
She was paid £123,871 for the period between 1 April and her resignation on 4 August 2016 while her allowances and expenses for the period totalled more than £80,000.
The inquiry has been beset by problems since its inception with its first two chairs, Lady Butler-Sloss and Dame Fiona Woolf, stepping down before beginning their work. The inquiry’s chief lawyer, Ben Emmerson, resigned last year but Prof Jay has insisted it is continuing with its work.