John Greenway, MP for Ryedale and a former Conservative spokesman on home affairs, is paid for chairing the Responsibility in Gambling Trust - a charity funded by the gambling industry to give grants to groups that help people with gambling problems.
His payment is thought to be one of the highest for any charity trustee in this country. Greenway defended the fee on the grounds that he performed two roles: chairing the board of trustees and acting as executive chairman to the trust.
"If I didn't have that second role, we would have to employ someone else to do it, and I don't think they could be as effective if they were not a trustee" he said.
Greenway said he devoted more time to the post than the one day a week stipulated in his contract, which was approved by the Charity Commission.
Debra Allcock Tyler, chief executive of the Directory of Social Change, called the payment abhorrent. "It goes completely against the nature of voluntary activity," she said. "I think he should give back the money, or at least stop being paid. It's an appalling example to set, particularly as an MP."
Governance expert Judith Rich said she was surprised at the level of the fee.
Greenway is the second of the trust's chairmen to be paid. "The original dispensation was given by the commission for our previous chairman," said Malcolm Bruce, chief executive of the trust, which was established in 2004.
A spokeswoman for the Charity Commission said: "In line with our proportionate approach, we looked at the proposed remuneration level as a percentage of the charity's income and the reasons given by the charity for seeking to remunerate.
"The charity's previous experience had been that the level of commitment and expertise were such that no suitable candidate working on a voluntary basis had been found. Under the circumstances, and given the charity's income, we were content to authorise the payment."