The celebrity shopping expert Mary Portas has admitted she was paid £500,000 by Channel 4 while making her series on reviving town centres, after denying it during a combative session with MPs this month.

In evidence to the communities and local government select committee about her work producing a plan for David Cameron to revive moribund shopping centres, Portas scoffed at suggestions that Channel 4 had paid her the sum for producing shows based on the two dozen towns selected to receive state support and advice.

During the session she was asked whether she had "received cash for producing TV programmes that are based on some of the Portas pilots". Portas responded: "If I was getting £500,000 for Channel 4, let me tell you, I would be a happy woman. I am not."

But in a letter to MPs she now says she "misinterpreted" the question and admits that it covered her series featuring the pilots. "My contract with Channel 4 covers two years with a requirement to make 20 episodes in total and amounts to £500,000," she wrote.

This year the Guardian obtained documents from a freedom of information request that revealed that film-makers working with Portas on her reality TV show lobbied government officials to direct taxpayer funds to certain high streets because they would be popular with television audiences.

Portas told the Labour MP Simon Danczuk during the select committee session that she had not been "aware that we were trying to influence what should be the pilots". The two dozen towns selected for £100,000 of state support were whittled down from almost 400 entries.

She said she investigated the issue after the Guardian contacted her, and was "satisfied by what I found".

Portas said the lobbying was a result of a "former employee's enthusiastic response to the hundreds of inspirational video pilot applications", but it remained "categorically untrue" to suggest she had influenced the selection of towns.

A spokeswoman for Portas said the letter to the select committee had been written to "clear up any misunderstanding and [because] she wanted to be honest and open with parliament".

Danczuk said: "There are not many people I know who could forget about a half-a-million-pound payment. It's very disappointing that Mary Portas wasn't straight with parliament when asked about this.

"I am concerned about the idea that who should get government money was based on the desire to be visually interesting for television rather than the need to revive the high street. Concerns have been raised previously in parliament about this and the government should have realised problems like this would occur when they develop policy based around reality TV personalities."