US President George W Bush continues to support World Bank President Paul Wolfowitz despite a scandal over pay raises given to his girlfriend.
'The president has confidence in Paul Wolfowitz and his work' at the World Bank, White House spokesperson Dana Perino said.
Mr Wolfowitz, who was backed for the prestigious post by Mr Bush in 2005, is fighting for his political life after World Bank directors said they had not approved staggering pay raises for his girlfriend Shaha Riza, a World Bank staff member.
The bank's board of directors issued a statement and released documents that contradicted Mr Wolfowitz's claims in relation to pay increases given to his girlfriend.
More than 100 pages of documents revealed that on Mr Wolfowitz's personal direction, Shaha Riza was given raises that took her annual pay package to nearly $200,000.
She was reassigned from the World Bank to the US State Department when her partner took up his position in the bank.
However, she remained on the World Bank payroll despite her move, which was made to avoid any conflict of interest.
Ahead of the bank's annual spring meeting this weekend, Mr Wolfowitz said: 'I made a mistake, for which I am sorry.
'In hindsight, I wish I had trusted my original instincts and kept myself out of the negotiations', he added.
Mr Wolfowitz has been waging a campaign against corruption in the 185-member World Bank's multi-billion-dollar lending.
He is also under fire from staff for his management style, following a series of clashes with the board and hostility towards his appointment of Republican Party allies to jobs in his inner circle.
The World Bank's staff association said in a letter to 10,000 rank-and-file staff that Mr Wolfowitz had destroyed the trust of employees and should quit.
And the Financial Times newspaper today called for him to go, either voluntarily or at the behest of the board.
In a strongly-worded editorial, the paper said if he stayed the Bank risked becoming an object not of respect, but of scorn, and its campaign in favour of good governance not a believable struggle, but blatant hypocrisy.
