Council executive salaries are ‘rewarding mediocrity’, says MP

A Labour MP has responded to the latest “Town Hall Rich List”, which showed that Croydon Council has at least 15 executives being paid more than £100,000 per year, by saying that such high salaries are “rewarding mediocrity”.

Croydon Town HallSimon Danczuk is the MP for Rochdale who, incidentally, has conducted much painstaking work to unearth the official cover-up around allegations of child abuse by the former Liberal MP, Cyril Smith.

Danczuk also sits on parliament’s communities and local government select committee which is investigating chief officers’ pay.

As Inside Croydon reported yesterday, executive salaries at Croydon Council appear to have fallen by £1million in the last year for which records are available, but high-level golden handshakes for some officials who are made redundant continue to be made at public expense, while the borough’s chief executive, Nathan Elvery, was appointed to the £180,000 per year job without it ever being publicly advertised.

“Senior council officers have got to show restraint,” Danczuk told the Press Association.

“I’m of the view that some of these officers should take a dramatic cut in their salary. Between the best and least-paid workers on some councils the gap is growing too far and this is not acceptable.

“Working for local authorities is about public service and these figures suggest that some are there just for the money.

“We all know there are some great officers in local government – Sir Howard Bernstein at Manchester Council is one example. But there are too many cases where salaries do not match performance and we’re rewarding mediocrity.”

Croydon North’s Labour MP, Steve Reed OBE, who until late 2012 was the leader of Lambeth Council, has made no comment on local authority pay levels. Croydon South’s Tory MP, Sir Tricky Dicky Ottaway, may have said, “Where’s Croydon?” Gaffe-prone Gavin Barwell, the Conservative MP for Croydon Central, may have said, “Can they work for nothing?”


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6 Responses to Council executive salaries are ‘rewarding mediocrity’, says MP

  1. davidcallam says:

    Have you noticed the way local authorities, Croydon included, have cut their costs to suit the reduction in central government grants?

    Its the modestly paid, hard-working, useful people who have lost their jobs. The executive team has found ways around the problem, as we might easily have predicted. No chief executive believes that they or their immediate team is expendable.

    We will only see an end to this gravy train of greed when we have a root and branch reform of local government. We need far fewer local authorities and therefore far fewer chief executives and far fewer executive teams with their retinues of overpaid hangers on.

    But saying that to existing chief executives is like asking bankers to modify their bonuses. Indeed, both will use the same bogus argument about the market rate: if we reduce the size of the local government jobs market there will be more potential chief executives chasing fewer jobs. Supply and demand suggests that will lead directly to smaller individual remunerations as well as less of them. Everybody wins, except the chief executives.

  2. davidcallam says:

    PS: But the principle block to such reforms could be those involved in local politics, councillors and others. Some decades ago Michael Heseltine was despatched, with others, around the country to make the case for a drastic streamlining of local government.

    After months of enduring the rubber chicken circuit and at times facing hostile reaction from his various hosts, Heseltine and his colleagues were forced to conclude they had been given mission impossible. And in those days, councillors only had out-of-pocket expenses to lose, rather than the substantial amounts that now apply.

  3. Rod Davies says:

    The issue is not simply the level of executive salaries. If you have a highly efficient senior management team that ensures that the maximum proportion of operational funds are deployed directly delivering high quality services, then, frankly, it’s OK.

    However, since the development of the internal market in the 1990s there has been a steady augmentation of back office and executive salaries and operational costs, and a resultant reduction of the proportion of total funds available for the front-line services.

    The only way change this situation is to reform the way that all forms of government express the cost of service delivery so that internal support services and apportioned corporate costs are clearly identified and can be compared with the private sector.

    There is a complicating factor that some departments have a dual role as corporate guardians of the public interest and deliverers of support services to front-line services. The former role must remain within the organisation, and the co-location of these functions protects the latter from substantive scrutiny.

    Further the general low level of investment in business management skills among front-line managers results in continuing dependency of back-office functions, and thus these support functions are larger than they should be.

    As I have argued elsewhere the route to management in the public sector should be via front-line service delivery functions. Were this to be the case then management development resources would be directed towards high-flyers in the front-line. Increased skills would lead to less dependency on the back office and more challenge to its status. Front-line managers would demand Value for Money from the support services like Finance and HR. It would also lead to the development of a far more responsive service delivery able to react to social and economic changes far more quickly than at present.

    We also should look at what we expect officers at varying levels to do for their salaries by comparing authorities.

    Councils that attract high-flyers don’t pay the highest wages, but they do award authority and responsibility to far more junior personnel providing the opportunity to gain experience and lay the foundation for a solid career. The authority that doesn’t award authority to junior and mid-level officers losses the high-flyers, wastes potential and costs far more than even the headline salaries suggest – and ends up with the plodding examples of utter mediocrity.

    • So you agree that appointing “back-office wallah” Nathan Elvery as borough CEO without actually advertising the job was a bit of a blunder?

      • Rod Davies says:

        Whether Mr Elvery is the right person for the job largely depends on what you see as the primary goals based on your assessment of Croydon Council’s performance.
        My own view is that there is a profound need for a break with the past, and the establishment of a revitalised organisation. I think this would have needed a complete outsider with a very strong leadership style and very much the common touch to lead from the front. But I am not a councillor and I was not party to the decision making.

        Cllr Newman and his colleagues have their stated objectives, and presumably they were sufficiently impressed with Mr Elvery to believe he could deliver. Cllr Newman may have thought that the recruitment of an outsider would have caused an extended period of uncertainty at a time when quick action is needed.

        I even have some sympathy for Mr Elvery as he is tasked to deliver with an existing team, much of it not of his choosing, where he has to fundamentally change his relationship with them. It can be a very lonely place at the top, especially if former colleagues decide to undermine your plans.

        To answer your question more directly, it is not the matter of recruiting a Chief Exec with front-line experience, but rather changing the whole organisational culture. There are simply too many rumours and allegations about inadequate management and unacceptable behaviours from inside the workforce for it to be ignored. This is long standing predating either Mr Elvery or Mr Rouse.

        If the appointment of Mr Elvery proves to be a mistake, then the decision will hang around the necks of the Labour Party like the proverbial albatross.

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