The Department for Culture, Media and Sport has been criticised for "costly and inefficient" use of office space.
Culture Secretary Tessa Jowell heads the DCMS
MPs on the Public Accounts Committee said the department spent more than £40m a year to accommodate 5,000 staff.
Much went on "upmarket" London premises even though many employees did not need to be in the city, they said.
The DCMS said it was moving 950 posts out of London by 2010, but it was essential that its 500 core staff were located near to Parliament.
In its report, the Public Accounts Committee called for government departments to seek better value for taxpayers.
Chairman Edward Leigh said: "This message should be displayed in bright lights in the Department for Culture, Media and Sport, a department which is remarkably casual in its approach to the management of office accommodation."
The Tory MP for Gainsborough said that too many officials were at upmarket addresses in London "for no clear reason".
He said the annual cost for accommodating each official ranged from £1,000 to £30,000 - and being in London raised costs by an average of £3,000 per person.
One of the most "extraordinary" decisions was paying £180,000 a year to house the six members of the Football Licensing Authority in Cavendish Square in London's West End, the committee said.
It examined the office space used by DCMS and 24 of its sponsored bodies in England.
It found 64% of staff were in London and even after a planned move of 950 jobs to regional offices, more than half of the total would remain there.
They also said that each individual body was acting "independently with no effective leadership" from the centre, which risked "costly and inefficient" consequences.
A DCMS spokeswoman said many of its agencies were already based outside London and its plans to move 950 more out by 2010 exceeded its targets.
She added that DCMS sponsored bodies - such as the Football Licensing Authority - had agreed targets to save money on accommodation.
When London leases came to an end, they had to prove there was a strong business case to remain in London, she said. And DCMS headquarters was already being reduced from three buildings to one.
But she added: "As a department of state, it is essential that DCMS's core of 500 headquarters staff is located close to Parliament."
Galleries and museums were not included in the study because most of their space was used for display and storage.