Setting The Record Straight On MD Pay

Lots of noise this week about senior pay at the Council, which has led to misleading statements from the opposition and internet trolls, so I thought I’d set the record straight.

Let’s start with some facts…(seems a good place to begin!)

In April 2012, Brentwood Council ceased the CEO partnership arrangements with Essex County Council.

The set up had been in place since 2007 at a cost to Brentwood taxpayers of £30k per year for the services of the CEO. When first introduced, it was pioneering in the country and delivered a huge saving compared to the cost of Brentwood having its own CEO. A great initiative, which is now common place across the Country with many districts sharing senior management and making substantial savings along the way.

Fast forward to April 2012 and Brentwood decided to take this one step further and abolish the post of CEO altogether.

Our Managing Director, who already worked under the CEO, took on the components of the Chief Exec’s role, along with the extra responsibilities of being the most senior officer at the Council.

A full review of like for like pay and conditions was carried out, in comparison to other authorities. Changes made, gave the MD a £5k basic pay rise and a £5k potential increase in performance related pay to reflect the extra responsibility and effective promotion, providing Brentwood with the second cheapest senior officer arrangement in the county. Only Maldon Council pays less than Brentwood and the decision to make the MD the most senior officer and not have a CEO, delivered an extra overall saving of c £20k.

To be clear, the comparison of costs was as follows:

CEO: 2011/12: £30,000 ( paid to ECC for services of the Chief Exec)
MD: 2011/12 salary £97,000 plus maximum of £10,000 Performance Related Pay based on delivery of objectives.

NB: £7k of the maximum of £10k was paid for the PRP. This is contractually based on delivery, not desire to pay and reflects a move away from higher salaries regardless of performance and a shift towards rewarding success. It is not a discretionary bonus but part of a pay structure, the final paid figure of which, must be substantiated.

2012/13:

CEO: £0 ( end of shared arrangements)
MD: salary £102,000 plus maximum of £15,000 PRP based on delivery of objectives ( reflects additional responsibilities taken on from CEO)

NB: £13,800 of the maximum of £15k was paid for the PRP. Again, this is contractually based on delivery, not desire to pay. It is not a discretionary bonus but part of a pay structure, the final paid figure which, was considered by an independent panel and which must be substantiated.

With pension and add ons, the total cost of the MD in 2011/12 was £118,241 with £30k paid for CEO so a total of £148,241. With the changes to the senior staffing arrangements coming in in April 2012, the decision on the final 2011/12 PRP of £7k was not made until after 31st March, meaning the figure was not included in the 2011/12 year end accounts and why it specifically says in the 2012/13 statement of accounts that it was paid in 2012/13. Indeed, a figure cannot be included if it has not yet been decided!

This compares to an overall cost of £130,641 for the MD in 2012/13 and no charge for a CEO, reflecting the change in roles and decision not to have both a CEO and MD as outlined above.

Whilst opposition members will try and spin it, the reality is that the changes in the arrangements following the decision to no longer share a CEO, saves Brentwood residents c£20k pa.

Furthermore, this was all reported on last August and there has been no change since and no increase in 2013/14. To suggest an increase of 23% is simply wrong. The 2011/12 MD package was £118,241 plus £30k for CEO, compared to £130,641 and £0 for CEO in 2012/13.

Interestingly, both the Leaders of the Lib Dems and Brentwood First were members of the remuneration panel that put forward the proposed figure of £13,800 for the 2012/13 PRP. I don’t disagree with their recommendation but for a party or individual to be part of that process and contribute to the figure, only to criticise now is disingenuous ( if not predictable) to say the least…

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