An LGC commentary on the TaxPayer’s Alliance town hall rich list
So who are the highest paid people in local government?
Today saw the publication of the TaxPayers’ Alliance annual ‘Town Hall Rich List’ of council staff who were apparently paid more than £100,000 a year.
As ever the conclusions drawn by the alliance (a slightly shady body whose funders are unclear and whose claims to act in the interest of taxpayers pay scant regard to value for money) must be treated with caution.
Nevertheless, that public sector pay should face scrutiny is only right and proper and it is a thorough piece of research, pulling together data from more than 400 annual reports. As such it is a mine of interesting information: anyone who claims they are uninterested in what their peers earn is unconvincing. If you don’t want to find out who the highest paid English council chief executive was in 2017-18 then you can stop reading now.
But first is to deal with some of the claims made by the alliance. The alliance words its press release carefully, referring to total remuneration rather than take home pay, a distinction that is often lost when these figures are reported by the mainstream press.
The alliance claims 2,454 council employees received “remuneration in excess of £100,000”. However, when you look at those whose basic salary is reported as £100,000, excluding employer pension contributions or redundancy payments, this falls to 1,734.
Essex CC, which was highlighted as having the largest number of employees paid over £100,000, at 55, said more than a third of these were individuals who were made redundant and whose severance packages meant they had gone over the threshold. The planned £95,000 cap on public sector exit payments, which is said to be on the way, is designed to stop this.
The alliance also claims 28 council employees received more than a quarter of a million pounds in 2017-18. However, the majority of these include compensation payments, which usually arise when someone is leaving their job outside the normal run of things, or so called ‘pension strain’ when a council makes an additional payment to the Local Government Pension Scheme (LGPS) to enable someone to take early retirement.
For example, former Slough BC interim chief executive Roger Parkin, who left the council in November 2017 after councillors decided not to make his appointment permanent, was reported to have received total remuneration of £595,077. However, almost half of this (£339,903) was pension contributions not money in his bank account. The remainder was made up of his salary and £142,000 compensation.
Former Northamptonshire CC chief executive Paul Blantern also received a payout of £142,000, taking his total remuneration to £277,000. There are valid questions to be raised about the scale of payouts in the event of organisational failure, as in Northamptonshire, and even the value of public sector pensions compared to their private sector counterparts, but to present these payments as routine is misleading.
Once compensation payments are excluded then the number of council officers paid over £250,000 falls to eight. Of these three are in the devolved nations and two – Vale of White Horse and South Oxfordshire DCs – are each shown as having paid £333,493 to their head of paid service, which is a joint appointment shared between the councils.
LGC sought clarity on this and was told their joint chief executive was in fact paid a salary of up to £141,820, split equally between the two authorities, and the remainder of the £333,493 “included one-off expenses incurred during staffing changes, which haven’t reoccurred”. Current chief Mark Stone took over in June 2017, suggesting the remainder of the payment could relate to the resignation of predecessor David Hill.
Of the remaining three an undisclosed individual at Northamptonshire CC was paid £262,500 which as this LGC Briefing was finalised the council were unable to confirm.
Buckinghamshire CC chief executive Rachel Shimmin just scraped over the £250,000 threshold when her employer pension contributions were included (her salary was £199,484). Which leaves the only chief executive to earn over £250,000 as a basic salary in 2017-18 as – drum roll – Wandsworth and Richmond LBCs’ joint chief executive Paul Martin, who took home £256,525 excluding bonus and before employer pension contributions.
Given these two Conservative-run well-heeled boroughs implemented this shared arrangement as an efficiency, the TaxPayers’ Alliance can hardly have anything to complain about surely?