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Councils accused of 'management army'

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Local councils have been accused of hiring 'a new army' of managers whose pay and benefits packages have grown faster than other sectors of the economy.

The allegation comes from Taxpayers' Alliance in a follow-up to its initial Council Spending Uncovered report in 2007 on council spending on publicity.

In response, the Local Government Association insists that suitable wages have to be paid to senior managers responsible for "multi-million pound budgets in highly complex organisations".

The Taxpayers' Alliance's second paper examines town hall spending on middle and senior managers - those being paid at least£50,000 per annum.

It says: "The increase in the number of local authority employees being paid more than£50,000 per annum has far surpassed the rate of increase in the economy as a whole, and with a recession now taking hold that trend has become unsustainable."

The report's findings include:

  • The average local authority is employing almost 22% more staff on£50,000-plus remuneration packages than it did in 2006-07; 66 people in 2006-07 and 81 people in 2007-08. The number of staff on£50,000-plus has risen from 31,000 to almost 37,000 in one year.

  • The average local authority spent well over£5m employing people on£50,000-plus remuneration packages last year.

  • The total bill for those council staff on£50,000-plus remuneration packages was nearly£2.4bn last year - up more than 20% since 2006-07.

  • Over the past 11 years, the average local authority has increased the number of people on£50,000-plus packages dramatically; an average of seven people in 1996-97 has increased to an average of 81 people in 2007-08. This is an 11-fold increase. By contrast, in the economy as a whole, the number of people earning more than£50,000 has increased by only 3.2 times over the past 10 years.

  • There were 15,388 middle and senior managers being paid at least£60,000 last year in local government - the salary of MPs has been£63,291 since April 2008.

Matthew Elliott, chief executive of the TaxPayers’ Alliance , said: “Councils are ignoring economic reality and simply recruiting more managers and handing out more pay rises than taxpayers can afford."

John Ransford, deputy chief executive of the LGA, said: "The people who earn these salaries are responsible for multi-million pound budgets in highly complex organisations, and to attract the best and brightest people to deliver value for money, you have to pay a suitable wage.

“The figures are like comparing apples and pears as they are out of date and misleading. If the report compared similar jobs in the private sector then the Taxpayers’ Alliance would see that councils are providing people with very good value for money.

"Councils' commitment to driving up standards is going from strength to strength and performance continues to improve albeit with strained resources. Councils are the most efficient part of the public sector, making efficiency savings of around£100m every month.”

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