The rise and rise of the local government fat cats

FACT 1: Tower Hamlets - one of the poorest boroughs in the country - employs over 27 people earning more than £100,000pa.

FACT 2: The number of local government workers earning fat cat salaries is rising fast.  429 people were on over £100,000 last year.  578 people get over £100,000 this year.

FACT 3: The earnings of senior local government staff are rising three times faster than nurses.

FACT 4: The majority of local authorities are secretively still fighting to hide how they are spending council taxpayers' money.

Watch the 18 Doughty Street video below for a one minute summary of the TaxPayers' Alliance's Local Government Rich List by its Head of Research, Corin Taylor. It's followed by a minute showing the TPA's Campaigns Director, Blair Gibbs, and ConservativeHome's Samuel Coates getting into trouble with security whilst promoting the report outside the Tower Hamlets' Town Hall.

The full Town Hall Rich List can be downloaded from the TaxPayers' Alliance website.

Click continue for an exclusive article by Corin Taylor on the report.

"The security presence outside the corporate-looking headquarters of Tower Hamlets council was impressive.  Our attempts to get near the front doors with a few supporters, a placard and a hired Rolls Royce were almost thwarted.  However, we were lucky to have a sympathetic driver and the waiting press photographers got the shots they needed. It just seems to be getting that much harder these days to get close to anyone responsible for spending taxpayers’ money, let alone make a simple protest outside a public building.

Our press stunt was designed to promote the new TaxPayers' Alliance report – The Town Hall Rich List – by targeting Tower Hamlets council, one of the poorest boroughs in the country, who employed the most people (27) above £100,000 and seemed to have the biggest case to answer. This was one of the most surprising findings from our research.  The poorest areas – where people find it most difficult to pay their council tax – often employ the highest number of town hall fat cats.

Following on from last November’s Public Sector Rich List, we conducted extensive research using the Freedom of Information Act to obtain the names, positions and total remuneration details of all staff earning above £100,000 a year in 2004-05 and 2005-06 in 230 local authorities, covering every corner of the United Kingdom.

Local authorities refuse to make this information publicly available in their annual accounts, and we have encountered (through leaked emails…) a coordinated cover-up attempt from a number of town halls, presumably concerned that publication of this information will increase local opposition to another round of above-inflation council tax increases. 

Nevertheless we have succeeded in obtaining responses from the vast majority of local councils and can present the startling figures, which illustrate the sheer scale of inflated pay for senior staff in local government. There are 5 people in local councils who earn more than £200,000 a year and 64 people in town halls who earn more than £150,000 a year. 

The number of people earning above £100,000 in local authorities is increasing at an alarming rate.  There are 578 people on these “fat cat” salaries, compared with 429 people the year before. Consequently, the total pay bill for these senior staff stands at £72 million, compared with £53 million the year before, an increase of 36 per cent. Senior staff who feature on the Rich List in both 2004-05 and 2005-06 enjoyed an average pay rise of 6.1 per cent, three times the official rate of inflation and far higher than the 1.9 per cent pay awards granted to nurses last week. 

We have been battling with local councils to obtain the information for months.  Our battle is not yet entirely won, and we are releasing the Town Hall Rich List now to assist with our campaign to make local authorities reveal just how they are spending taxpayers’ money.  A minority of local authorities are still trying to cover-up this information and prevent its release into the public domain, through refusing to publish names and, endless delays and prevarications, and various spurious reasons for refusal.  We urge local newspapers and members of the public locally to assist us in putting pressure on these recalcitrant local authorities to release full details of senior staff pay.   

The TPA is appealing ourselves against a number of these recalcitrant local authorities and plan to bring a case before the Information Commissioner.  The principle should be established that details of names, positions and total remuneration details of senior staff in the public sector should be made publicly available.  After all, listed companies are legally required to publish Directors’ basic salary, benefits in kind, variable payments, company pension contributions, total remuneration and a comparison with the previous year’s total. Taxpayers have a right to know the same information. 

This is the first ever list of the highest paid people in local government.  At least now a bit more light has been shed on exactly where all that council tax money has gone."

Comments

[Gareth]

I'm afraid Mr Taylor's performance on 'Today' this morning was risible. Birmingham City Council, for example, has a budget of over £3Billion pa, frankly, I would be appalled if the Chief Exec and senior officers did not earn over £100,000. This is total non-story.

[TomTOm]

NO it is not a non-story ! It is not transparent, it is not accountable, it is not competent, it is not democratic.

Now Councillors trouser £12.000 and Council Leaders upwards of £50.000 and Chief Executives £250.000 plus - not merely £100.000........it is time to know how they are appointed, who appoints, and what the total pay package is and contractual terms.

English local govt has been out of control since 1972 and a significant cause of inflation since then.

Birmingham is a failed Council whose Chief Executive Lin Homer is now a failure at the Immigration & Asylum Service; Christine Gilbert, former Chief Executive of Tower Hamlets (?) Council and wife of Tony McNulty is now head of Ofsted.

The politicisation of Chief Executive positions has rendered elected councillors irrelevant - it is time to elect the Officers not the Councillors

[anonymous]

Where are the facts and figures on English District Councils. I know of at least one Chief Executive in Hertfordshire who earns more than £120,000, acts as a returning officer for vast amounts of money and has a tiny budget and a relatively poorly performing authority.

The real fat cats are in the Districts!

[Derek]

Why has it become accepted that salaries of chief executives should be linked to the turnovers of councils? It is this which has fuelled the huge increases in pay. We need to get right away from that concept and instead link pay to the actual difficulty of doing the job. If there are enough candidates then we should be able to find people of the right calibre who are willing to take the job at a more reasonable rate of pay.

Thee seems to be a culture in some authorities that it is necessary to adverise a large salary to attract candidates of high enough ability. Of course if too many authorities offer these high salaries the system leads to an ever increasing spiral of pay, which is what appears to be happening. We need councils to reduce these salaries when advertising jobs, where appropriate, and see what quality of applicants they attract!

[comstock]

I take it this new found Tory dislike of 'fat cats' also applies to the privatised utilities,not to mention outsourcing companies like capita etc?

[TomTom]

I take it this new found Tory dislike of 'fat cats' also applies to the privatised utilities,not to mention outsourcing companies like capita etc?

Last time I looked Capita was a Plc and subject to shareholder votes on Directors and pay........I have not had such a choice with my local council but would welcome the opportunity - after all they found £220.000 "too low" to attract the right candidates and the Council Leader rather fancied £100.000pa so the Chief Executive would obviously need to earn several multiples of the Prime Minister's salary

[Anon]

Guardian

http://news.bbc.co.uk/1/hi/england/west_yorkshire/3020509.stm

The council claims the £200,000 package is needed to attract the kind of high calibre candidate it needs to replace outgoing chief executive Ian Stewart.

But it has been urged to rethink its recruitment strategy by the Institute of Directors (IoD).

£200K salary for council chief

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THE new chief executive of Bradford Council could be paid up to £200,000 for taking on the job of managing the city.

The council is now advertising nationally for someone to replace Ian Stewart, who is leaving his post to become chief executive of Cambridgeshire County Council next month.
They are offering a salary in the range of £170,000 to £200,000 for a person who will be responsible for a budget of about £500m and 23,000 staff.
Senior politicians have agreed that the huge salary is necessary in order to attract top-calibre applicants.
Ian Greenwood, leader of the council's Labour group, said: "I wish we could pay less but the advice from the consultant was that this is what we need to offer. It would be selling Bradford short to say we are not going to pay something that might be politically embarrassing, therefore we'll appoint someone who's not up to the job."
A recent survey found the average salary for council chief executives was £103,806, but larger and more challenging districts pay more.
Last year, Suffolk chief executive Lin Homer was lured to Birmingham, Britain's biggest council, for more than £165,000 a year, while Sheffield chief executive Bob Kerslake is reportedly paid around £130,000.

http://society.guardian.co.uk/print/0,3858,4744978-111207,00.html

'Dynamic' officer named as council's new chief executive

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Lizzie Murphy
BRADFORD Council has announced its new chief executive is to be Tony Reeves, Wakefield Council's deputy chief executive.
Mr Reeves, 41, will take up the post from September, subject to council approval on June 27. The council refused to be drawn on his salary, saying it was "still under negotiation", but it is believed his predecessor, Philip Robinson, was on about £120,000 before taking early retirement last November.
In May 2003 the council hit national headlines – and criticism – after it advertised the job with a potential salary of £200,000, more than Prime Minister Tony Blair's £175,000.
But three of the six candidates shortlisted dropped out of the running and the job was deemed to be too stressful to attract suitable candidates. The salary was also slashed.
Mr Robinson, interim chief executive at the time, took on the role. Mr Reeves is now taking over after more than three years as deputy chief executive of Wakefield Council.
Coun Kris Hopkins, Bradford Council leader, said: "We are absolutely delighted that Tony said he would accept the offer...He is young, dynamic, inspirational, creative but also very level-headed and experienced.
"
Mr Reeves said: "I am very excited at the prospect of coming to this vibrant district that is enjoying a £2bn transformation and I'm also looking forward to working with the many communities and businesses that live and work in this attractive and varied area."

YP

[DavidDPB]

Fat Cats like Gerald Jones, the second highest paid in the country at £227,424. No wonder the residents of Wandsworth suffer from high council ta...er...no, wait a minute.......

[Cllr Carl Cross]

Nobody can possibly object to paying high quality managers a decent salary to do the job. The point is that high salaries and effective management are not always correlated, PLUS there are simply too many of these well paid positions at officer (and councillor level). Managers managing managers to coin a phrase.

In my own (Labour controlled) council of Halton, one of the most deprived in the country, our top 60 earners take home over £4m per year, before pension contributions; whilst all bar one of the 35 Labour councillors are paid a special responsibility allowance of between £3k and £20k per year on top of their basic allowance of £7k.

We have four directorates, but 8 Executive members who are responsible for them and 7 committees to oversee them - all attracting extra payments for chairmen and vice chairmen.

Gravy train? You decide.

[Justin Hinchcliffe]

Does anyone know how much Nicky Gavron takes from the public purse?

I disagree with Gareth (not often I do it, I have to say). Why should a CE of some tin pot local authority be paid more than the PM? That said, councillors should bring in performance-related pay - the number of councils with full stars would swiftly improve!

[Councillor Russell King - Wandsworth Council]

Unfortunately, this report by the Tax Payers Alliance is short sighted. The Council Officers at Wandsworth that the report highlights are all excellent and are worth their financial packages. The reason that they are excellent is that they consistently deliver better services at a lower cost to the tax payer. Paying low salaries for sub standard Council officers would be a false economy and result in higher taxes.

The Tax Payers Alliance should look at the data in more detail and ask whether the Council officers are providing value for money. Councils with high taxes and/or poor services with highly paid Council officers should be the aim of their anger not Councils with great services and the lowest Council tax in the country like Wandsworth.

[malcolm]

I think Russell King doth protest too much.Wandsworth has had the lowest Council Tax for many years and the lowest Community charge before that. They were able to achieve this long before they started paying exhorbitant salaries to anybody.
Having said that it does not suprise me in the slightest that the majority of high paying councils were both useless and run by the Labour Party.

[Account Deleted]

A single magic circle law firm, Clifford Chance, has 580 top partners earning £651,000 each. So in a single year it pays out £377 million to its top brass. Almost all those who have been there for more than five years are likely to be on more than £100,000, or more than these 'fat cats'.

The reason that council execs pay is shooting up is that pay for all senior management is shooting up I'm afraid, it is that simple.

If you pay peanuts you get monkeys.

The real problem from the point of view of council taxpayers is that these people are NOT accountable and so it is hard to know if you are getting your money's worth. But that is not to do with the amount people are paid, it is more to do with the fact local councils are largely one party fiefdoms and have precious little power anyway.

[TomTom]

If you pay peanuts you get monkeys.

So Evolution demands people push for big pay rises to improve perceptions of their worth ? Stand by for some exciting times on the labour front as house prices force up incomes

[Bromley bartender]

Good on them for having the balls to go to the Town Hall, what a sinister fortress that place is!!!

[comstock]

TomTom says Last time I looked Capita was a Plc and subject to shareholder votes on Directors and pay..

Sure, shareholders have a vote, but the taxpayers who ultimately fund the salary of Capita's directors don't. Nor do the customers of the privatised water companies, for example.

Don't get me wrong, I agree wholehartedly about these 6 figure salaries, but why stop at local councils? Why not target the multinationals, the banks, the supermarkets, the insane bonuses paid in the City?

Of course if you were to believe in *that*, it would constitute a sea, nay an ocean, change in politics, and would force me and millions of others to reconsider my vote.

Is that a flying pig passing my window :D

[Ron Scott]

This is one of the reasons why Wiltshire county council has submitted a bid for a Unitary authority to replace 5 chief executives with one.
And yet the Party still seems to think that the waste and bureaucracy of district councils is still worth having just because they produce conservative councillors and therefore activists to get conservative MPs elected!
Moral high ground??

[Steve]

Comstock. Live in the real world. The private sector generates wealth which effectively funds local councils. It's like comparing apples and pears.

[Denis Cooper]

It occasionally happens that shareholders vote down a proposed remuneration package for the company's senior executives, but not very often - for the simple reason that the shares are mostly controlled by financial institutions with senior executives who naturally want similar packages for themselves, and they don't
refer back to the millions of individuals with savings invested in their institutions.

[comstock]

Comstock. Live in the real world

A legitmate criticism, I can be guilty of idealism on occasions. Mind, you may say I'm a dreamer, but I'm not the only one.......hmmm that might make good lyrics for a little song I'm writing..... ;)

It's like comparing apples and pears

I'm not so sure it is, you know. If these salaries are wrong when in the public sector and funded by taxation surely they are also wrong when in the private sector and funded by taxation, and taking the argument to it's logical conclusion wrong when in the private sector and funded by you and I by whatever means.

I think this touches on a much wider issue than just 'taxpayer value for money'.

But then I'm just an idealist :D

[Denis Cooper]

"a bid for a Unitary authority to replace 5 chief executives with one" - who'd then be paid an even higher salary commensurate with his responsiblities, and who'd be even less accountable to the people paying him. Definitely a false economy.

[Matt Davis]

The trouble with the recent massive increase in top level local authority salaries is that mostly the same people are in the same jobs, are not performing particularly well, but are now being paid a very great deal of other people's money for doing the same job they previously did. This pay rise was always just a cynical Labour attempt to buy the loyalty to central govt, and to the left wing centralising agenda, of senior Council officers whilst pretending that there was some kind of need for council salaries to be equivalent to private sector ones despite the many major perks enjoyed by local govt officers that are not available to those in the private sector or the real world generally. The whole thing would also be a lot more palatable if these dodgy bungs weren't also being accompanied by a real terms drop in earnings for those at the bottom of the council structures, the people who do the real work in delivering front line services. Yes this has been a fat cat scenario and a totally unjustifiable one at that.

[Valedictoryan]

From what I’ve seen it’s a fallacy to think that the private sector is more hardnosed about executive pay, performance and severance than the public sector. Directors of floated companies are equally on a gravy train, spending other people’s money – and that makes them especially generous, especially to themselves. Denis is absolutely right that "shareholders" (often working with other people’s money themselves) are rarely an effective check on the system. The boardroom culture is one of high wages and generous severance packages when it goes tits up – and nobody is going to derail that because they might be next.

[Paul Oakley]

One level of fat cat bureaucrat which could eaily be abolished is that of Executive Mayor. In my council, Lewisham, the referendum on establishing the post attracted a turnout of 18% and only 51% of these voters were in favour. Our mayor, Steve Bullock, only needs the support of 1/3 of councillors to approve the annual budget and policy framework documents. He can make almost all other decisions without needing to win a vote of councillors or
the cabinet.

As I understand CCO's policy on Executive Mayors, the decision about whether to support or oppose these sinecures is left up to local associations. Are there any Tories who are actually in favour of these expensive and undemocratic plutocrats? If not, we need to establish a hard-line policy of opposition.

It is said that such posts need to be highly remunerated in order to attract quality candidates who would otherwise work in the private sector. As that is so obviously the case, we need not worry about sending out redundancy notices as the incumbents would quickly get jobs in the real world.

[Matt Davis]

This myth that Council salaries need to be private sector equivalent in order to attract good quality candidates from the private sector is quite frankly total tosh. I have sat on a number of senior officer appointment panels in my local authority and every single time if there is a private sector candidate, which isn't very often, they are always marked down for "lack of local government experience".I'll say it again this whole pay issue has always been and completely remains a Labour bung to buy loyalty in clear breach of the duty of local govt officers to serve first and foremost their local community.

[TomTom]

I'm not so sure it is, you know. If these salaries are wrong when in the public sector and funded by taxation surely they are also wrong when in the private sector and funded by taxation,

Might be true but it is not the issue. The BBC employs over 306 Executives on >£100.000 from taxpayer funds but I cannot get any of you to liberate us from the TV licence

As for Capita - they should be fired. You might argue Ron Aldridge giving £1 million to Labour is simply a dividend.

The fact is I want to know how these people are appointed and why compensation consultants are used.

Comstock - do tell me about Lin Homer and Christine Gilbert and their successes that made the former Head of the Immigration & Asylum Service and the latter Head of Ofsted

[TomTom]

I see Gordon is already having an influence in Bradford !

'Britishness' cash awarded
By Newsdesk
Comment

Groups in Bradford have been awarded cash to celebrate "Britishness".

Communities Minister Phil Woolas pledged more than £4.3 million for organisations "to promote a common sense of citizenship".

Winners across the district include Bradford YMCA, National Hindu Student Forum (UK), Christian Muslim Forum and Religions for Peace (UK).
advertisement

Mr Woolas said: "This demonstrates how we are stepping up work in communities to promote understanding and cohesion by effectively engaging women, young people and hard to reach groups.

"We must continue to emphasise our sense of Britishness and the shared values which hold us together."

[Denis Cooper]

We need a few high profile criminal prosecutions, even if none of those found guilty get the maximum sentence of life imprisonment.

http://www.cps.gov.uk/legal/section22/chapter_c.html

The elements of misconduct in public office are:

a) A public officer acting as such.
b) Wilfully neglects to perform his duty and/or wilfully misconducts himself.
c) To such a degree as to amount to an abuse of the public's trust in the office holder.
d) Without reasonable excuse or justification.

[JamesB]

If you are going to start a campaign on local government salaries it might be advisable to get your facts right first....

I belive that, for example, Tower Hamlets has 9, not 27 staff on £100,000 or above.

Has anyone else spotted any schoolboy errors?

[Account Deleted]

Given that the average person working in the City both earns 6 figure salaries, are we really to expect less of people near the top in councils?

Yes, in general the private sector generates wealth more than the public sector, but do we really want total incompetents in charge of sorting out local transport/education etc etc??? If you are a good local council executive, you could transfer across to the private sector, and so you need to be paid enough to not do so... Given private sector executive pay has risen rapidly in the past 10 years, this obviously has an effect on public sector executive pay.

The TaxPayer's Alliance should focus more on what it does best, pointing out where government is interfering unnecessarily and expensively. Not pretending we can somehow ignore the labour market's shift towards paying executive's more or magic it away...

[TomTom]

If you are a good local council executive, you could transfer across to the private sector,

Bollocks. I know the private sector is pretty naff in Britain but why would they want someone whose career has been spent in local govt as a Housing Officer or handling govt directives.

I was wondering if the Head Librarian might move over to BP now Lord Browne has gone ? I wonder if Private Equity groups will be poaching Council Directors to invigotrate British business ?

I mean look at the great Adam Crozier - Football Associstion and now making us all proud of the Royal Mail.

Yes, Britain is lucky to have its police chiefs, and council chief executives and water company executives - there is a global markets for their talents and China and Russia and the US are crying out for British talent.......no doubt Blair would be gone if the £186.000 weren't keeping him here

[comstock]

Tom Tom said

Comstock - do tell me about Lin Homer and Christine Gilbert and their successes that made the former Head of the Immigration & Asylum Service and the latter Head of Ofsted

Who? What? When? Haven't a clue who they are....should I have?!?

(very confused :D )

[TomTOm]

(very confused :D )

Second Post on Thread

[greg]

Could i just point out that a lot of these supposedly "well-researched figures" are bollocks.

A lot of council officers have been given massive payrises overnight. I hope their husbands and wives haven't spent it already... ;)

[Richard]

"Don't get me wrong, I agree wholehartedly about these 6 figure salaries, but why stop at local councils?

Why not target the multinationals,"

Because they are private organisations that I am not forced to give money to.

"the banks,"

Also private organisations.

"the supermarkets,"

Private organisations, not forced to shop there etc

"the insane bonuses paid in the City?"

Why are they insane? If a company has the money why should it not be able to hand over that money to its employees? The money has been earnt in a legitimate course of business and nobody is compelled to do business with the companies that make the money.

[RedSam]

What a complete non-story. Local government gets extremely good value from its senior officers, who are in the whole more than talented enough to go into the private sector and earn much more money.

Seems to me that the report authors have no idea about local government at all.

[comstock]

"Why not target the multinationals,"

Because they are private organisations that I am not forced to give money to

I don't know how sustainable that argument really is. On a superficial level one can choose Pepsi over Coke, Sainsburys over Tesco or Natwest over Barclays but whether that constitutes a real 'choice' over giving ones money anymore than handing over council tax is another matter. Indeed it could be argued we do have some 'choice' when it comes to council tax, because we have votes in a local election (one quite soon indeed)

I'm following my thought train through to it's ultimate conclusions and not particularly liking the answers I get tbh, because the alternatives have been shown to fail, and fail badly.....so I'll shut up. :D

Aren't I supposed to be drifting rightwards by my time of life? :D

[Matt Wright]

Sorry, I do think the story is over simplified although there are elements of truth in it. I think paying a good salary for senior officers is not wrong so long as they actually are good. It is quite hard to get rid of bad ones and even when you can they tend to walk away with big deals. As regards the couple of comments about councillors getting £12,000, this is a very low sum for what is often a lot of work nowadays. Few ordinary members of the public would do such a job for such low pay,

Matt

[Old Hack]

So just how much should one pay the Chief Exec of an organisation with a budget in excess of £500m?

One further point - how many of these LA'fat-cats' were head teachers? A sizeable number I suspect.

How much is a top performing head teacher worth Mr Taylor?

18 Doughty Street - politics for adults? Gimme a break.

[TomTom]

One further point - how many of these LA'fat-cats' were head teachers? A sizeable number I suspect.

ZERO I should think.

Local Management of Schools means LEAs do not handle such matters and very few headteachers earn such salaries compared to Directors off Diversity, Chief Executives, Directors of Social Services etc.

[TomTom]

As regards the couple of comments about councillors getting £12,000, this is a very low sum for what is often a lot of work nowadays. Few ordinary members of the public would do such a job for such low pay,

Matt

Frankly, I have already told one Conservative councillor who is useless that we should abolish Councillors and ELECT the Officials

[TomTom]

when it comes to council tax, because we have votes in a local election (one quite soon indeed)

Rule of thirds and in year 4 no election.

Biggest element of Council Tax - Police Precept and Fire - no control over either body.

Council useless but of 90 seats our area has 3 of which one up for election in 3 out of 4 years.

This is not democracy or accountability

[TomTom]

Local government gets extremely good value from its senior officers, who are in the whole more than talented enough to go into the private sector and earn much more money.

with the contractors to the council no doubt......at least Doncaster Council is a paragon in this respect with its wonderfully good value officers - and Hull

[Cllr Carl Cross]

I say again, it's not necessarily the individual salary levels that are the problem, it's the sheer number of these positions - many of them completely unwarrented. Ditto councillor allowances.

[Cllr Carl Cross]

Apologies: unwarranted ;-)