A mother with four children has been placed by her council in a £2m townhouse at a cost to the taxpayer of more than £91,000 a year.

The stucco-fronted three-storey property is in Kensington, west London, the country’s richest borough. It costs £1,755 a week to rent - a bill met by housing benefit - and has a front and back garden, five bedrooms, two bathrooms, a double reception room and roof terrace. The street is lined with sports cars.

The family, who moved into the property in September, have remained there despite a pledge by James Purnell, the work and pensions secretary, to cut back lavish housing benefit payouts. Elsewhere in the borough, five-bedroom houses are available for half the price. The case highlights the perverse nature of the housing benefit system that allows council tenants to live in subsidised properties well beyond the means of most taxpayers. Under Labour, spending on housing benefit has risen from £11.1 billion in 1997 to £15.4 billion in 2007.

Figures released under freedom of information laws revealed five local authorities where councils have paid rent to families on housing benefit at a weekly rate equivalent to more than £50,000 a year.

Chris Grayling, the shadow work and pensions secretary, said: “The government was trying to grab the headlines by saying it was doing something about this problem when in reality it has continued to preside over £100,000 housing benefit payments.”

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