One investment bank is expected to earn up to £15.4 million in fees for emergency advice to the Government on the banking crisis, a new report reveals.

Credit Suisse is being paid up to £300,000-a-month to provide financial advice to the Treasury as one of a raft of consultants drafted in amid the crisis, according to a National Audit Office (NAO) report published today.

The NAO has scrutinised taxpayer cash spent on bank bail-outs and found the total cost of financial advice to the Treasury since September 2007 is expected to balloon to £107 million by next April.

Its report found the Treasury was “justified” in using unprecedented sums of taxpayer cash on bank rescue measures to protect the wider financial system.

But the NAO criticised the Treasury for hiring advisers on expensive contracts for up to a year that included undefined success fees.

Credit Suisse and its fellow investment bank Deutsche Bank were brought in on contracts paying £200,000 a month each for a year - as well as a potential further £5.8 million in success fees.

Credit Suisse was also hired on another contract to advise on the toxic asset protection scheme, which increased to £300,000 a month from June, with a potential £3 million success fee. Its total fees could reach £15.4 million by next April.

The NAO was highly critical of the lengthy contracts and failure to include a definition of “success”, although it stressed that just under £100 million of adviser costs will be refunded largely from part-nationalised Lloyds Banking Group and Royal Bank of Scotland in return for state support.

“In instances such as this, where criteria for success will be unclear, it is not good practice to enter into such an agreement in the first place or to leave payment solely to the discretion of the procuring authority,” said the NAO.

The Treasury had yet to decide whether to pay out the success fee by the end of October, it added.

Today’s report also reveals little was known about the scale of the problems at Royal Bank of Scotland before it was bailed out with vast sums of taxpayer cash.

The NAO discovered the Government believed RBS’s capital position was “reasonably strong” just days before RBS was given covert emergency support from the Bank of England.

This funding - which peaked at £36.6 billion for RBS - was only made public for the first time late last month.

The NAO report confirms a mammoth £131 billion is expected in total taxpayer outlay on bank bail-outs by the end of this year, including last year’s Northern Rock nationalisation.

Net cash outlay is estimated at around £117 billion after an expected £14 billion is recovered in fees.

The total public sector support - including borrowing guarantees and liquidity support from the Bank, as well as savings depositor protection - runs to £850 billion.

But the NAO said the Government was right to provide the unprecedented support to protect the stability of the banking system, which was sent into meltdown after the collapse of US investment bank Lehman Brothers last autumn.

The bank rescues succeeded in halting the spread of the crisis, while also safeguarding depositors, it said.

However, the Government has failed to achieve improvements in bank lending to businesses, despite the billions of pounds of support, said the NAO.

It emerged last night for the first time that RBS and Lloyds are unlikely to meet their 2009/10 commitments for £27 billion in lending to firms.

Amyas Morse, head of the NAO, said: “It is difficult to imagine the scale of the consequences for the economy and society if major banks had been allowed to collapse.

“The Treasury was justified in using taxpayers’ money to safeguard savings and stabilise and restore confidence in the financial system.

“But the big question is what all of this will eventually cost the taxpayer. This will take time to answer.”

Its recommendations include requiring the Government to ensure any sale of its stakes in RBS and Lloyds take into account not just price, but also wider impact on competition.

The NAO also suggests a review of the various bodies charged with handling the part-nationalised assets by the end of 2012 to ensure “efficiencies”.

The Treasury said it “welcomes” the report and would provide a detailed response in time for a Commons hearing by the Committee of Public Accounts on December 14.

It added: “The Government took unprecedented action to prevent the collapse of the banking system and put in place measures to stabilise the entire financial system. This was a highly technical exercise which required advice from a wide range of experts. The vast majority of the costs incurred will be recovered from banks who were recipients of taxpayers’ support.”

It faces tough questioning on the cost of bank bail-outs and the secret support made to RBS and Halifax Bank of Scotland in the select committee meeting.

Edward Leigh, the committee’s chairman, said in response to the NAO report that he was “greatly disturbed” by the decision to keep this funding secret and to “play fast and loose with Parliamentary rules”.

On the failure for RBS and Lloyds to meet lending targets, he added: “The widespread suspicion that the bailed-out banks are using the injected funds simply to fill their pockets with gold will have been fuelled by the finding that those banks receiving taxpayer support are not likely to meet their commitments to lend to struggling businesses. The Treasury can do little if lending targets are not met.”