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Denham call for probe on CEO pay offs

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Ministers have pledged to go after council chief executives who leave their posts with a big pay off after a row with members and then re-surface in a similarly paid job just weeks later.

Communities Secretary John Denham called for “an urgent probe” by the Audit Commission after “a recent spate of cases” and that, in the current climate, every penny of tax payers’ money must count.

Mr Denham added: “It’s not acceptable for town hall chiefs and council leaders to agree expensive deals to part company just because they don’t get on or because they’d prefer to work with someone else.”

The move comes just weeks after Martin Smith secured a reported £500,000 pay out from Tower Hamlets LBC after a spat with the leadership.

Audit Commission chairman, Michael O’Higgins, said: “The evidence from recent years is that higher rates of recruitment of existing chief executives led to increased turnover rates, additional recruitment costs and wage inflation. Auditors already closely examine pay-offs.”

“We will look at the regulations in the light of our study and what district auditors report.”

A Tower Hamlets spokeswoman disputed the reported amount paid out to Mr Smith but refused to comment further on how much he received.  

For more – including local government reaction – see tomorrow’s LGC

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