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Decline in new chief pay continues to slow

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LGC’s salary tracker finds average salaries fell by 1.5% over the past year

salary tracker

salary tracker

Salaries offered to new chief executives continued to fall in 2018, with more than a third of hires earning a lower salary than their predecessor, according to research by LGC.

Analysis of chief executive appointments made by councils in 2018 revealed the average salary awarded was £148,048.

The figure represents a decrease of 1.5% compared to the average £150,365 salary of outgoing chief executives.

While the figures indicate an ongoing trend in falling pay for newly appointed chief executives, the extent to which salaries have fallen has slowed compared to previous years.

 

rees and holden

rees and holden

Joint appointments save cash

Appointments in the year to August 2017 were paid an average of 1.9% less than their predecessors while analysis conducted in 2016 revealed a 2.1% fall.

increases and decreases

increases and decreases

There were 53 chief executive appointments between September 2017 and December 2018. LGC’s salary tracker found half of the roles went to internal candidates – the highest proportion since 2014. Two-thirds (35) were first time chief executives.

The downward pressure on senior pay does risk getting the balance wrong between the reward and the responsibilities and risks

Tracey Lee, Association of Local Authority Chief Executives

Salary comparisons are based on the 46 appointments for which LGC was able to obtain comparable data. 

The continued decline in chief executive salaries prompted concern about councils’ ability to compete for high calibre candidates.

Tracey Lee, chair of the Association of Local Authority Chief Executives and chief executive of Plymouth City Council, said: “The chief executive role is among the most demanding and complex in the public sector and does deserve appropriate financial recognition.

“The downward pressure on senior pay in local government does risk getting the balance wrong between the reward on one hand and the responsibilities and risks on the other.

“There is a danger that fewer people will be prepared to take on these most senior roles. It’s really important we do attract and retain the talent that’s needed to support councils in moving forward so salary levels need to be competitive.”

Karen Grave, president of the Public Services People Managers Association, added: “We do not advocate disproportionately high salaries but it is absolutely critical that all organisations have the best leadership and that leadership feels appropriately rewarded.

“The downward trend in salary suggests that as local government continues to be under severe budget pressure, this is increasingly experienced at the very highest levels.”

Folkestone & Hythe DC, formerly Shepway DC, saw the biggest fall after the local authority’s chief executive post was scrapped and corporate director Susan Priest was designated head of paid service, but not chief executive.

The median sum of Ms Priest’s salary band is £87,472, reflecting a 36% decrease compared to the £136,813 salary of outgoing chief executive Alistair Stewart.

Matt Rain, head of communications at Folkestone & Hythe DC, said: “We are going through a major transformation project that will see the council streamlined and re-shaped. A slimmer council requires a smaller top team and we did not appoint a new chief executive after Alistair Stewart left in March 2018.

“One of our corporate directors, Susan Priest, was appointed head of paid service and, even with the £10,000 special responsibility allowance that goes with the role, this resulted in a reduction in salary costs.”

About a third of newly appointed chief executives secured a salary higher than their predecessor’s during the course of 2018.

We do not advocate disproportionately high salaries but it is absolutely critical that all organisations have the best leadership

Karen Grave, Public Services People Managers Association

The largest salary increase was seen in Lancashire where the county council awarded a £206,885 salary to incoming chief executive Angie Ridgwell, representing a 19.3% increase on the £173,417 earned by her predecessor Jo Turton. However, Ms Ridgwell has also taken on legal responsibility for the council’s finances as section 151 officer under a revised management structure.

Council leader Geoff Driver (Con) said: “The salary for this combined role reflects the responsibilities she has to undertake for both jobs.”

Milton Keynes Council also increased its chief executive salary. Michael Bracey, who was promoted from corporate director for people after a period acting-up, will received £176,000 – 12% more than his predecessor Carole Mills. A spokesman for the authority said: “The salary, which was last reviewed in 2014, reflects Milton Keynes Council’s role as unitary authority for one of the UK’s fastest growing places.

“We benchmark our salaries against neighbours and other comparative authorities in order to attract the best people.”

methodology

methodology

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