An Islington Council official disciplined for alleged racial harassment was paid £16,000 to “go quietly”.

In a secret deal leaked to the Gazette, housing worker Irene Pledger received the pay-off after a tribunal the previous year.

Mrs Pledger, 56, had been due to go back to work after being disciplined, but town hall trade union “militants” had pledged to prevent her from going back.

Cllr David Hyams, leader of the town hall’s Social Democrat opposition, said: “This shabby little deal is the price [Labour] council leader Margaret Hodge [who signed the deal] is prepared to pay to get Mrs Pledger to go quietly.

“They have paid out blood money to satisfy the blood lust of the loony left.”