The Public chief's large pay off

Sally Luton, chief executive of Arts Council England, West Midlands, will receive the financial package when she steps down in June 2010 as part of a restructure.

The 57-year-old has been criticised for presiding over the Arts Council in the run up to the opening of troubled West Bromwich arts centre, which has cost £72million and is now £49million over budget.

Ms Luton, a former craft gallery and restaurant boss, was in charge of the West Midlands arm of the Arts Council when The Public went into administration in 2006, with chief executive Sylvia King forced out along with half of her staff.

But today an answer to a parliamentary question from West Bromwich East MP Tom Watson reveals that Ms Luton, who is paid £82,325 a year, will get 18 months salary plus a £91,008.60 lump sum from her pension when she leaves, bringing her one-off departure fee to £211,480.60.

She will also get £33,080.37 a year pension for the rest of her life. This will cost the Arts Council, funded by taxpayers, £86,229.

To date the Arts Council has not spoken about its involvement during the creation of The Public, which began with Sylvia King's Jubilee Arts project in 1995.

Mr Watson said: "Given the sensitivity around the Arts Council's involvement in The Public and the cost of that, I think people will react with fury that in an economic downturn, this kind of severance package has been paid in the public sector."

Jo Forrest, of Arts Council England, West Midlands, said: "Funding decisions made by the Arts Council are not made by individuals. In cases where large awards are made, then they are ratified by the Arts Council's National Council.

"The development of The Public was undertaken by an independent organisation funded by the Arts Council. We worked hard to avoid The Public going into administration, but ultimately the decision to put the organisation into administration was taken by the board of The Public.

"Since then we have worked very hard with all of the stakeholders to remedy the situation."

Politicians and campaigners have accused Arts Council England of throwing money at The Public.

The Arts Council handed over £32m of taxpayers' money to get it open.

It opened behind schedule last year but its centrepiece gallery only launched in August due to technical problems. A final funding award of £3million was made by the Arts Council in July after Sandwell Council took over the venue.