Government ministers have confirmed that Ed Lester, the head of the Student Loans Company, will have tax and National Insurance payments deducted from his £182,000 pay package in future.

That's after it was revealed recently that Mr Lester has been able to get away with paying a significant proportion of his income tax due to a loophole.

Despite this, business secretary Vince Cable has defended the role of Mr Lester, saying he was "an exceptionally useful individual who has helped to turn round that organisation [the Student Loans Company]".

He added: "The arrangements under which the negotiations took place involved substantial value for money for the taxpayer, a tax cut by the individual and we will pursue matters of public concern on the tax issues."

The news comes at a particularly inopportune moment for Mr Lester, with university tuition fees set to rise to as much as £9,000 in the new academic year.