David Cameron accepted £20k payout when he left Downing Street

The former PM opted to take three months salary in lieu of his full ministerial pension

A friend of Mr Cameron has defended his decision to take the payment, saying: ‘He is not a money-grubbing man. He passed a law which stopped him getting a huge pension from the day he left office’

David Cameron choose to accept a near £20,000 taxpayer-funded “golden goodbye” payment when he left Downing Street in June.

The former Prime Minister, who stepped down as an MP on Monday, took the tax-free ministerial severance payment when he resigned following the vote to leave the European Union on 23 June.

In addition to the payout, which is voluntary under the rules governing money given to departing politicians, Mr Cameron will also be entitled to £115,000 a year to run his own private office, the Daily Mail reported.

This “Public Duties Cost Allowance” covers the cost of offices and secretarial staff to pay for the “special position in public life” that former prime ministers hold.

Mr Cameron’s staff were reportedly calling around commercial real estate agents in central London on Tuesday to find a suitable property to house the new office which will run any political or charitable works he chooses to engage in now he has left public office.

But the former leader is said to be more interested in working on his memoirs - which are expected to be sold for a seven figure sum.

But a Cabinet Office source told The Independent Mr Cameron had accepted the money, thought to be £17,125, in lieu of his entitlement to the full prime minister pension he is entitled to.

Under official rules, prime ministers and Speakers of the House of Commons are generally not entitled to the payment as they have “preferential pension arrangements”.

A friend of Mr Cameron defended his decision to take the payment by telling the Mail: “He is not a money-grubbing man. He passed a law which stopped him getting a huge pension from the day he left office”.

But the former PM was accused of “croynism” after it was revealed his resignation honours lists was full of the names of his supporters and prominent party donors.

Mr Cameron was accused of using the list for “personal gain” with Labour's deputy leader Tom Watson saying it was one of the worst examples of the “old boy’s network”.

He said: “That Mr Cameron proposes to reward his friends network on such a huge scale will not only bring the honours system into disrepute, it will undermine the reputation of Theresa May.

“It's cronyism, pure and simple and proof the Tories will always put their own interests before those of the country.”

The Independent has contacted Mr Cameron's office for comment.