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Caerphilly acted unlawfully on top pay, say auditors

By Vivienne Russell | 6 March 2013

The way senior managers’ pay rises were decided at Caerphilly County Borough Council last year was unlawful, auditors have ruled in a public interest report.

Photo: Alamy

The report, published today by the Wales Audit Office, considered whether the authority acted appropriately when its Senior Remuneration Committee approved pay increases for the council’s top executives in September 2012.

Auditor Anthony Barrett declared that the decision was unlawful on a number of grounds. These included the council’s failure to advertise the committee meeting or make its agenda available for public inspection as should have been done.

The presence of the council chief executive at the meeting and the fact that he had written the pay report under consideration also made the process unlawful.

‘Certain officers, including the chief executive, who would have been (and indeed were) beneficiaries of the decision were present at the meeting to approve the salary increases,’ said Barrett.

‘No declarations of interest were made and these officers did not leave the room while the decision was made. Consequently, they participated in the decision-making process when they had a disqualifying financial interest.’

Barrett also noted that the report presented to the committee did not consider the full range of remuneration options identified by the council's independent pay advisers, nor did the committee give any detailed or explicit consideration of these alternatives.

Barrett concluded: ‘I do consider much can, and indeed should, be learnt in respect of the processes followed by the Senior Remuneration Committee. Council officers have indicated to me that they accept that there are lessons to be learned.’  

The WAO made five recommendations, including the production of clear guidelines on conflict of interest and more detailed recording of meetings.

A spokeswoman for the council said the WAO’s recommendations were being reviewed.

She added: ‘It is important to stress that the decision of the Senior Remuneration Committee was rescinded at a meeting of the full council on January 17 where independent legal advice was received and a new decision was reached.

‘The Wales Audit Office report will be considered at a meeting of the full council in due course, so it would be inappropriate to comment further at this stage.’

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