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'Rich list' unites employers and unions

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A lobby group has been criticised over the quality of its research after publishing a third annual ‘Town Hall Rich List’.

Critics have questioned the validity of research by the Taxpayers’ Alliance after they included redundancy payments and counted teachers as council employees.

The report has proved so controversial that unions representing some of the lowest paid council workers have rallied to defend the salaries of senior managers, describing the research as “simplistic”.

Using data from councils’ 2010-11 annual reports - the most recent available - and including employer pension contributions, expenses, benefits in kind and additional allowances as well as basic pay, the Taxpayers’ Alliance claimed the number of local government chief officers receiving more than £250,000 in Remuneration was 52, a rise from the 45 listed in its 2009-10 ‘rich list’.

But LGC analysis shows the number of people remunerated above £250,000 actually fell from 35 to 19 once individuals with redundancy payments were removed.

The Taxpayers’ Alliance also said remuneration above £100,000 was received by 3,097 council employees in 2010-11, a 13% increase on the year before.

However, the tally for 2010-11 included 305 people who had received redundancy payments and another 75 people who could be teaching staff, according to the notes in the report.

The total also included a small number of posts where the employees in question had taken extra responsibilities or a second role as part of a management restructure.

A spokesman for the LGA said councils had significantly reduced the number of senior staff and middle managers in a bid to cut costs and this had led to a “small spike” in redundancy payment “which is mostly responsible for the increase in the number of officers receiving more than £100k in 2010-11”.

The Taxpayers’ Alliance report also showed the average remuneration increase for staff in the ‘rich list’ was 26.85%, but it admitted “this would have been driven up by a number of employees receiving large redundancy payments in 2010-11”.

The alliance said “a more accurate picture” would be the 1.83% median average increase, which it said came “at the same time that a wider public sector pay freeze was in place”.

However, the LGA published more recent earnings data on Tuesday and that showed there was a 1.8% increase over the last year for all employees regardless of salary levels. Known as “pay drift”, the figure relate to increment payments paid to all staff, regardless of salary level.

The LGA’s more recent data showed local government’s total salary bill actually decreased by 5.2% in cash terms, or 9.7% once inflation was taken into account, since the year before.

Heather Wakefield, UNISON head of local government, said: “In its bid to undermine public trust in public spending and public services, the so-called Taxpayers’ Alliance has taken far too simplistic a look at a complex issue.”

The third year of pay freeze was “deeply unfair” and had to come to an end, but “attacking top pay will not help taxpayers, including council workers,” she said. “For councils to attract the best calibre of leaders, they need to pay the going rate.”

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