Department for Levelling Up, Housing & Communities
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Full disclosure proposed for Council top earners
New proposals for the full disclosure of senior staff pay and perks at local councils were announced by Local Government Minister John Healey today.
The consultation proposes changes to the Accounts and Audit Regulations (2003) creating a new legal requirement and could require up to 475 local authority bodies to include detailed senior pay information in 2009/10 annual statement of accounts.
The new remuneration disclosure rules would require councils to set out full details for around 2500 specifically identified senior posts including temporary senior appointments covering salary, bonuses, pensions, perks and compensation pay offs.
These new disclosure standards would bring councils up to the same high standards that are already required of civil servants and Government Ministers.
Additionally, the proposals build on the standards set in central government by also requiring councils to publish a head count, in narrower £5,000 band increments, of all staff taking home more than £50,000 a year.
John Healey said:
"It is right that council decide the wages for their staff, but the public pays and they have the right to see the full picture of top pay and perks.
"Councils are big organisations with a tough job - they need the best people in charge. But we've recently seen top salaries rising far faster than the rest of local government. This salary spiral has to stop.
"The level of public disclosure for councils is much lower than we now rightly require from the civil service and ministers. I want it brought up to a better standard.
"That is why I am proposing full disclosure in new regulations that will mean authorities must publish in their annual reports what their top earners get in pay, pensions, redundancy payoffs, bonuses and other special allowances.
"In today's tough economic climate councils must think harder about senior salaries and this will put a brake on spiralling pay packets."
Central government's role is to set the right framework in which councils can decide their own pay and appropriate reward packages for good performance.
Mr Healey wants councils to ensure that pay and reward decisions are also made more fair and transparent. Councils are already beginning to discuss and share best practice around setting pay standards, especially at senior levels.
The Government recognises that pay is part of a wider workforce picture and is working with local government and partners to identify ways to widen the talent pool of potential recruits available to middle and senior management vacancies in local government.
Notes to Editor
1. The new regulation would amend the Accounts and Audit Regulations 2003 (Si 2003/533) ("the principle regulations"). The principle regulations apply in relation to England only.
2. Regulation 7 amendment would constitute a statement of accounts to include reference to remuneration reporting for senior officers. The amendment is intended to ensure comparable remuneration disclosure for all senior staff within organisations that will fulfil the same degree openness and transparency as the civil service and listed companies in the private sector (under the Companies Act 2006).
3. The consultation proposes:
a. Through amendments to regulations make it a requirement for 'remuneration disclosure' to include (a) salary; (b) bonuses; (c) additional payments; (d) compensation or ex gratia payments; (e) benefits in kind and (f) pensions;
b. A definition of 'senior' that includes the head of the authority's paid service; 1st tier officers who report to the head of paid service e.g. Director, Chief Officer or Strategic Director.
c. A change to the way staff earning over £50,000 is reported, breaking this down into £5,000 bandings in place of the existing £10,000 bandings.
4. The local authority bodies covered would include London borough councils, county and district councils in England; joint authorities; the Greater London Authority; National Park authorities; Waste authorities; TfL; Police and Fire Authorities.
5. The consultation proposes to bring pay disclosure in line with the recommendations of the Information Commissioner's Office: http://www.ico.gov.uk/upload/documents/library/freedom_of_information/practical_application/salaries_v1.pdf
6. The 12 week consultation will end on the 22nd June 2009. Full details can be found at: http://www.communities.gov.uk/localgovernment/publications/consultations/
Media Enquiries: 020 7944 3042
News Releases: http://www.communities.gov.uk/newsroom
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