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Doing more for less: chief execs' real-terms pay cut

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Commentary on chiefs’ falling pay.

The choreography of local government’s national employers and the TaxPayers’ Alliance over the past 24 hours was up there with that of Torvill and Dean.

Well, it was a truly beautiful thing if your main goal is to diminish the standing of councils’ top officers (not that LGC is accusing the employers of that).

No sooner had employers offered council chiefs a below-inflation pay rise than the right-wing, small state extremists, sorry – we mean “Britain’s grassroots campaigning group dedicated to reforming taxes, cutting spending and protecting taxpayers” – was bashing senior officers with its annual ‘Town Hall Rich List’.

“FAT CATS GET FATTER,” was The Sun’s take on it. “Council chiefs’ pay hiked by thousands as ordinary Brits see taxes soar.”

“Councils can’t pay bosses more than the prime minister then cry about being strapped for cash,” said the TPA’s campaign manager Chloe Westley in City AM.

She continued: “Some argue that these high salaries are necessary to avoid talented staff being poached by the private sector. But I’ve not heard of a single FTSE 100 company going around local councils to search for possible recruits.

“What’s more, local authorities do not face the same pressure that private firms do – they spend money, but do not face the daily pressure of competition for revenue.”

The Sun complained that “at least 251 councils out of 351 in England and Wales that The Sun examined spent more paying their CEO’s paypackets [sic] compared to the year before.”

The flipside of this is presumably that there was no evidence that 100 chief executives have got a pay rise when inflation is currently 2.6%.

Indeed the 1% offer for one year put forward by national employers yesterday would effectively result in a real-terms pay cut of 1.6%. Not that the national employers face an easy task – the pot of money they have to play with is diminishing: spend more on pay and you have less for services. Give chief execs more and there is less for less senior staff.

Unions have reluctantly agreed to the employers’ offer that rank and file council workers will get a 2% rise – or a 0.6% real-terms fall based on the current inflation rate – over each of the next two years. At every level the appeal of local government careers diminishes further due to increased workloads. Fewer staff often either equates to more work for those who survive or service reductions.

As Hart DC joint chief executive Patricia Hughes put it on Twitter: “Restructures of Chief Officer roles have also impacted - for us reducing 3 leadership roles to 2. We earn less now, than the Chief Exec of Hart District Council did in 2013 so recent headlines about Chief Exec pay certainly don’t apply here or consistently across #localgov.”

Numerous chief executives have privately expressed concern to LGC that their organisations are losing the talent which would supply the candidates to fill top jobs in future. Senior roles in children’s services or in digital transformation are particularly problematic to fill.

Austerity is adding to workloads and reducing pay (on any reasonable measure of it). The private sector provides an ever-greater lure. Those remaining in post have to contend with grave responsibilities such as ensuring the welfare of the most vulnerable children and adults, providing safe housing and spearheading regeneration efforts upon which their community’s future depends. In all of these efforts they are continually striving to do more with less.

As Tracey Lee, chair of the Association of Local Authority Chief Executives & Senior Managers, put it when rejecting the employers’ offer: “Chief executives are asked to provide leadership of the highest quality and resilience in transforming councils, delivering public service reform and securing economic and housing growth.”

If you want resilient, bold and transforming leaders, you are in a competition with others to recruit and retain them. Chief executives deserve a status that befits their growing role as the lead coordinating public sector leader in their area – and a fair pay rise.

Nick Golding, editor, LGC

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Readers' comments (1)

  • In real terms CX salaries are far less than 10 years ago ..the job is not less onerous than then and in many ways is tougher....I don’t recall seeing the salaries of newspaper editors or those employed by the so called”Taxpayers Alliance” being scrutinised ...wonder why?

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