Pickles to end council 'golden goodbyes'

9 Nov 12
Decisions to dismiss council chief executives and finance directors will no longer be subject to independent review, Eric Pickles said today.

By Richard Johnstone | 9 November 2012

Decisions to dismiss council chief executives and finance directors will no longer be subject to independent review, Eric Pickles said today.

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The local government secretary said he wanted to clear up the ‘legal minefield’ that can pressure councils into handing out ‘bumper pay-offs’ to senior officers they want to dismiss. He had previously said the cost of payouts to redundant town hall chiefs had hampered attempts to pool staff and resources between authorities.

Pickles pledged to change regulations requiring an independent person, usually a Queen's Counsel lawyer, to review dismissal and disciplinary cases for chief executives, chief finance officers and monitoring officers.

Currently, the Local Authorities (Standing Orders) (England) Regulations 2001 state that a council must appoint ‘a designated independent person’ to investigate proposals to remove individuals from these posts. The regulations also say that ‘no steps… are to be taken before a report is made’ and that a council has to pay the costs of the process.

The government now intends to amend the regulations so that all references to the independent person process are removed.

Pickles said the current system created a ‘slow and costly bureaucracy’, with the review process costing up to £250,000 in legal fees. It is therefore ‘no wonder councils are cowed into reaching for the parachute pay-offs at the first sign of trouble’, he added. The change would mean an ‘expensive roadblock’ to service reorganisation is removed.

The post of chief executive is not set in statute, which means there are no other barriers to removing it. Aside from the independent review, it only takes a vote by the council, as the role of statutory head of paid service, usually given to chiefs, can be given to another senior officer.

‘A town hall chief executive costs a lot of money, but if they are simply not up to the job, councillors must be able to get rid of them quick smart without having to throw away thousands in parachute pay-offs,’ Pickles said.

‘It is ridiculous that councils feel forced to give bumper pay-offs to dismiss inadequate chief executives simply to avoid these unnecessary golden goodbye reviews from expensive lawyers. Scrapping this bizarre bureaucratic ritual will save taxpayers money and put the decision firmly back in democratically elected hands.’

Responding to the announcement, the Society of Local Authority Chief Executives and Senior Managers said that council chiefs had helped town halls deal with funding cuts.

Solace chair Joanna Killian added: ‘Local government has demonstrated its ability to manage public resources effectively and efficiently in what are very challenging times, not just for the sector but also for citizens.

‘This successful track record is not accidental; it is the result of the excellent leadership and stewardship of the vast majority of chief executives who serve their communities prudently and with integrity. It is Solace’s firm belief that successful councils require both strong political and managerial leadership. Where either fails, to the detriment of the council, there should be fair and proportionate means of addressing that failure.’


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