Communities secretary Eric Pickles’ claim that local government chief executives’ pay had risen by 78% is actually based on a figure for FTSE 250 bosses, it has emerged.
In an interview on BBC Radio 4’s Today programme on Wednesday morning, Mr Pickles said chief officers’ pay had “increased by a staggering 78%”.
But the figure, from an Audit Commission discussion paper on top council officers’ pay published in 2008, actually referred to the rise in total salaries amongst private sector chief executives of FTSE 250 companies and compares with a 37% rise for council chief executives over the same period.
A spokesman for the Department for Communities and Local Government later insisted that Mr Pickles “was saying that both [private sector and council pay increases] are staggering but he mentioned the private sector one”.
Mr Pickles quoted the figure during an interview when he announced that councillors should approve all salaries over £100,000. He made no mention of private sector chief executive salaries and he attributed the 78% figure to an unnamed BBC programme.
The DCLG spokesman said the minister’s comments were not linked to the same error in a DCLG press release: “I am sure he has seen the full report itself.”
According to the Audit Commission paper, the basic salaries of council chief executives had risen by 37% between 2002-03 and 2006-07. This compared with a 78% rise in total pay for the chiefs of FTSE 250 companies, which it said were “comparable in that they may have similar turnover or staff numbers” to councils.
A press release issued by the Department for Communities & Local Government following Mr Pickles’ radio appearance incorrectly stated that “evidence shows that senior pay levels have spiralled recently. An Audit Commission report (Tougher at the Top? 2008) found that basic salary levels for single-tier and county chief executives increased by 34% between 2003-04 and 2007-08; if performance-related pay is included, total pay increased by 78% from 2002-03 to 2006-07.”
The same press release on their website has since been changed, without announcement or notice, to read: “Evidence shows that senior pay levels have spiralled recently. An Audit Commission report (Tougher at the Top? 2008) found that basic salary levels for single-tier and county chief executives increased by 34% between 2003-04 and 2007-08. If performance related pay is included, total pay for private sector chief executives increased by 78% from 2002-03 to 2006-07.”
A DCLG spokesman said: “The mistake has been rectified.”
A spokesman for the Audit Commission said it was aware that its research had been misquoted by the minister but was satisfied that the department had corrected the information on its website.
The same mistake is quoted in the earlier impact assessment for the sections of the Localism Bill that proposes pay policies for senior officers be agreed annually by full council rather than delegated to cabinet or another committee.
The assessment states that “there is a level of public perception that top pay in relevant authorities has got out of hand” and goes on to quote the 78% figure in relation to council chief executives.
The official document, produced to set out evidence of the need for legislation as well as assess the possible impact, also cites “anecdotal information” that some councillors were not aware of remuneration levels in their own councils.
It also quotes the Audit Commission discussion paper’s suggestion that pay levels had been pushed up by high turnover rates and added: “It is also claimed, anecdotally, that recruitment consultants (headhunters), when engaged in the process, tend to drive up salaries.”
GMB national secretary Brian Strutton criticised the minister for his “back-of-a-fag-packet” approach to figures, a criticism previously levelled by DCLG ministers at local government leaders.
Mr Strutton said: “For a senior government minister to make pronouncements without having his facts right absolutely proves that this was a back-of-a-fag-packet political fig leaf to divert attention from the cuts rather than a serious statement.
“Mr Pickles should apologise to all the council staff he erroneously maligned. It’s not so long ago that Grant Shapps was caught out quoting fake information as well.”
* Transcript of the interview available on LGC’s blog pages.