Jan 2009 22

New Research: COUNCIL SPENDING UNCOVERED: COUNCILS EMPLOY 22% MORE MIDDLE MANAGERS THAN LAST YEAR18

  • The average local authority employed almost 22 per cent more middle managers in 2007-08 than 2006-07.
  • The number of staff on £50,000-plus remuneration packages has risen from 31,000 to almost 37,000 in one year.
  • The total bill for those council staff on £50,000-plus was nearly £2.4 billion last year – up more than 20 per cent since 2006-07.
  • The average local authority spent well over £5 million employing people on £50,000-plus remuneration packages last year.
  • The report includes individual data on almost every single council in the country.

Following the first Council Spending Uncovered report, which revealed a £430 million town hall publicity machine, the second paper in the series examines the increase in town hall spending on middle and senior managers – those being paid at least £50,000 per annum.  The data in local authority accounts implies that councils have hired a new army of middle and senior management whose pay and benefits packages grow faster than the economy-wide average.

Whilst in a growing economy wages would normally increase above the rate of inflation, this town hall phenomenon is in a different league.  The increase in the number of local authority employees being paid more than £50,000 per annum has far surpassed the rate of increase in the economy as a whole, and with a recession now taking hold that trend has become unsustainable.

To read the full report, click here (PDF).

Key Findings

  • The average local authority is employing almost 22 per cent more staff on £50,000-plus remuneration packages than it did in 2006-07; 66 people in 2006-07 and 81 people in 2007-08. The number of staff on £50,000-plus has risen from 31,000 to almost 37,000 in one year. 
  • The average local authority spent well over £5 million employing people on £50,000-plus remuneration packages last year.
  • The total bill for those council staff on £50,000-plus remuneration packages was nearly £2.4 billion last year – up more than 20 percent since 2006-07.
  • Over the past eleven years, the average local authority has increased the number of people on £50,000-plus packages dramatically; an average of 7 people in 1996-97 has increased to an average of 81 people in 2007-08. This is an eleven-fold increase. By contrast, in the economy as a whole, the number of people earning more than £50,000 has increased by only 3.2 times over the past ten years.
  • The remuneration of middle and senior management in local authorities is racing past that of MPs.  There were 15,388 middle and senior managers being paid at least £60,000 last year in local government – the salary of MPs has been £63,291 since April 2008.

Matthew Elliott, Chief Executive of the TaxPayers’ Alliance, said:

“In the private sector thousands of people are losing their jobs, yet councils are better staffed and better paid than ever.  Councils are ignoring economic reality and simply recruiting more managers and handing out more pay rises than taxpayers can afford. Council tax bills are cripplingly high, and town halls must change their ways to bring the bill down."

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  • Matha Elliot

    If you compare the salaries of those in the private sector doing the same job you would see that as tax payers we are getting a bargain. Once again no understanding of the extensive work undertaken by the public sector. We do not just empty your bins and teach your children. Yours feally ever so appreciated for the hard work and unpaid overtime.

  • Graeme Pirie

    Matha, of course there are many good people in the public sector. I think however that you miss the point. The main point being why the expansion? Also remember when comparing pay of the massive difference in public/private sector pensions.
    You have mentioned the “extensive” work done by the public sector and I don’t disagree with you. The problem with this is that much of this extra work (and therefore extra cost) is done because the council want to do it – not the taxpayer, who ends up with the bill!
    Personally I’d be happier if the council got back to just emptying bins & running education!

  • Steve Robson

    While I to some extent agree with Graham Pirie that Councils should be allowed to focus on the core services, rather than have extras imposed on them by government (they have no choice though), I do think it is scandalous that the TPA criticise the quality of Councils when they themselves produce such a staggeringly bad piece of work. I would hope that any Council research officer who produced such low quality work would be sacked immediately and I really believe they would.
    Yes it got the headlines, but:
    -the TPA compares all different types of Councils with no reference to the total staff numbers and whether the outcomes are good or bad (I suppose they are all bad!)
    -in some councils, school staff are included, in others not!
    -where included (most cases), school staff are over half of the numbers – THEY ARE NOT MIDDLE MANAGERS, they are teachers!
    -at the detailed level, no account is taken of inflation. What is the point of comparing the number of people on the same salary ten years apart. My grandad used to earn 8 shillings a week; so should TPA staff earn that now (actually, that would be excessive for this work).
    What you need is some education from the 18,000 or so teachers included on this list. What on earth did they teach you at Eton?

  • Peter Phillips

    Seve Robson says:
    “I would hope that any Council research officer who produced such low quality work would be sacked immediately and I really believe they would”.
    What planet is he living on?!

  • Steve Robson

    Steve not Seve. I’m rubbish at golf!
    What do you know about it Peter Phillips? You just read in the Daily Mail that no-one ever gets sacked, when the FACT (heard of them)is that they do.
    While its easy to talk about it, its not fun I can assure you.
    Has Peter Phillips ever sacked anyone? Has Matthew Sinclair?

  • http://owsblog.blogspot.com Span Ows

    “I would hope that any Council research officer who produced such low quality work would be sacked immediately and I really believe they would.”
    This has to be a wind-up: NOTHING would be done and even if the work were shoddy nobody would notice and most certainly nobody would say anything; mustn’t ruffle feathers or rock the boat…no, no…just show up and tick your boxes.
    Steve, I’m sure if TPA did an indepth study over all councils for a year you’d still complain: your comments have “that look” about them.
    How do you account for the 11-12 fold increase in a little more than a decade (purleaze don’t give me some NL tripe about more teachers, policemen etc)? I’m sure nobody would have any problem at all with any of these figures if every council service was top-notch and education etc improved beyond measure; sadly that is not the case.

  • Steve Robson

    I’m afraid its just a FACT that the figures include TEACHERS. Its not my fault that the TPA employ people who can’t read Accounts.
    Its also a FACT that local authorities sack people. You can assert to the contrary, but you have no evidence, just prejudice.
    It is actually also the case that many public services have improved beyond belief, but you are right that people don’t believe it. Only 20 years ago, older people, people with learning disabilities (often minor) and mental health problems lived in long stay hospitals lying in bed, sedated by drugs. Now they live independent lives. It costs more, you don’t want to pay for it; fine, but its still much, much better. I also think that my children’s education is much better than my own 30 years earlier, though I recognise that is an opinion. And as for health care, we just treat so many more illnesses than 10, 20 or 30 years ago, no-one can deny its improved. The FACT of greater life expectancy proves that.
    Your FAITH that things are worse and cost more may make you happy, but I prefer to believe FACTS and also to recognise the tremendous improvements made in public services, even accepting that there is a cost to that improvement and that sometimes the people who don’t directly benefit (eg childless people think they don’t benefit from education, those without social care needs think they’ll never need them, the rich sponsors of the TPA who use private services) may resent paying for these things. I think thats the price of a civilised society, but your right I’m a liberal and your not.
    If this recession forces us back to the Dickensian society of your dreams, lets just hope (apologies to Neil Kinnock) none of you grow old, none of you get sick, none of you lose your jobs, none of you become poor and none of you need state education for your children. If you do, the public services you all so hate will no longer be there to help you.
    Goodbye.

  • Peter Phillips

    STeve Robson says:
    ‘What do you know about it Peter Phillips?”
    What do I know about it? Well I worked in local government for a while. I don’t anymore, but my present job, in private enterprise, involves regular contact with a number of local authorities. Some are OK, though no more than that, but others are absolutely dire.
    STeve also says:
    “Its also a FACT that local authorities sack people”.
    Methinks he doth protest to much – defending the indefensible.

  • Steve Robson

    If protesting too much is a sign of defending the indefensible, then that says something about the TPA and the New Right too.
    The comment about some are ok, some are dire, has some truth in it, though it applies to the private sector too, and certainly to some of the dodgy contractors the public sector has had the misfortune to employ (eg – in housing benefits where the private sector said they could run it better and cheaper and there has NEVER been a succesful contracting out, or all those accounting systems which fail to deliver to the sales promise).
    I think the point about sacking people is just not liking being called a liar; when you’ve done it on several occasions and its not a pleasant thing to do, its a bit galling when people say it doesn’t happen. Of course it should happen more, in the public and private sectors, but it does happen.
    I notice you’ve not refuted my examples of improvement!

  • http://owsblog.blogspot.com Span Ows

    “I notice you’ve not refuted my examples of improvement!”
    …all your arguements are strawmen! NOBODY has has said that not a single person is sacked from the public sector.
    “I also think that my children’s education is much better than my own 30 years earlier, though I recognise that is an opinion”
    …I’m glad you added that last bit because it really is an opinion shared by VERY few.
    Around 40% of the boys and almost 30% of the girls who left primary school in 2008 cannot read and write to minimum standards. [National Curriculum Assessments at Key Stage 2 in England, 2008 (Provisional)]…only provisional but soon to be FACT?
    “And as for health care, we just treat so many more illnesses than 10, 20 or 30 years ago, no-one can deny its improved. The FACT of greater life expectancy proves that.”
    …Of course it has but NHS spending isn’t responsible for medical research advancements etc. They play a part in it’s administration to patients. Longer life expectancy etc is down to being able to prevent things e.g. pneumonia, this has completely overturned the live birth stats as only a few decades ago there were many, mnay more baby deaths and most newborn deaths were down to pneumonia now almost none are; perhaps in your ‘facts’ you can tell us how much of the extra cash goes on treating patients? …and over why for most of this new century – despite all the extra dosh – NHS productivity has fallen every year?

  • Steve Robson

    Perhaps you’ve answered your own question; THERE WERE NO MINIMUM STANDARDS 30 YEARS AGO, so we just don’t know how good or bad children’s education was.
    And of course it is not ONLY the public sector that has increased life expectancy, but it does deliver it. It costs a lot of taxpayers money, but lives including babies lives are saved that just weren’t in the past and I am glad of that.
    The trouble is it all comes down to opinions because both sides can manipulate opinions and the liberal Guardian readers and reactionary Mail readers will never agree. I BELIEVE we are better of than in low tax Victorian times, better of than we were 30 years ago when tax levels were about the same as now and better off than we were in the middle of Thatcher era, when tax was a little lower, but public services were starved of funds. I do think we should reduce the benefits bill (which by the way Thatch started the massive increase in by the massive unemployment she created), I also think we should spend less on wars, and yes I think public services can be made more efficient, but I still think we have better value for money than ever before.
    The glass is indeed half full! Try thinking like that, you’ll be happier. I’m sure the cynicism and the pessimism of the TPA and the Daily Mail must shorten lives more than anything!

  • Tim W

    According to the OECD Britain has soared up the rankings in terms of spending on education in the last 10 years, but plummeted down the rankings (they measure science, maths and english). Even if education in Britain has improved – which seems unlikely – the spending has clearly been monumentally inefficient.
    So that’s that one cleared up.

  • http://owsblog.blogspot.com Span Ows

    “THERE WERE NO MINIMUM STANDARDS 30 YEARS AGO, so we just don’t know how good or bad children’s education was.”
    …that’s a fair comment but I’m just going by experience and my experience is that YOU are the only person that thinks their children’s education is better. Now obviously I haven’t done a national survey but you’d think in all these years I wpould have met somebody that coincided with your opinion.
    “And of course it is not ONLY the public sector that has increased life expectancy, but it does deliver it. It costs a lot of taxpayers money, but lives including babies lives are saved that just weren’t in the past and I am glad of that.”
    …agreed! I agree with most of the rest of your post as well; I read the Guardian occasionall and I never read the Mail (in fact the latter I’ve only used for the crosswords/sudokus etc when I find a copy!) BUT you must realise that the pessimism of the TPA etc (I don’t personally think it pessimism at all) is only based on what is happening..they’re not making it all up out of thin air and they’re right to highlight it. Lastly…
    ” I do think we should reduce the benefits bill…
    Tony Blair 1997: “By the end of a 5-year term of a Labour Government, I vow that we
    will have reduced the proportion we spend on the welfare bills of social failure. This is my covenant with the British people. Judge me upon it. The buck stops with me.”

  • Steve Robson

    I am surprised you know no-one who thinks education is better now than 30 years ago because I honestly have no doubt. It may be because I went to a comp and I guess education was better in the Grammar, but I think it was pretty crap in most comps then, whereas it seems good in many now and certainly Primary education is much more focused, I did nothing at Primary School and there certainly weren’t any TA’s like there are now.
    I do agree its not all about money and that we haven’t got a full return on our investment of the last few years. The key determinant of whether education is good or not is often the quality of teaching and I think if we could get rid of poor teachers and pay more to good teachers, that would revolutionise education. Barrack Obama says a similar thing applies in the States in “the Audacity of Hope”. As it is, I have seen good teachers leave because they can’t afford to live in the South East (despite the number that the TPA highlight are on over £50K pa), while poor teachers soldier on seemingly forever. That must change.
    You are right that the TPA feed on (but also cynically promote)real pessimism in the country. I do think that some of that is because by its nature, many services are not received by those who pay. So, social care is received by few but undoubtedly much better (no-one could really lament long stay hospitals). Thatch actually introduced “care in the community” to save money but its cost more. Some irony.
    There are services that people don’t want, like community building, but I think they are at the margin as is so much that the TPA highlight.
    In my darker moments, I do think perhaps it should all go and we should just let people succeed or fail completely by a combination of inheritance, fate and effort, but the liberal in me always wins and wants state education, health, social care etc. Someone on this site said get rid of the safety net, get rid of all social workers and live with the consequences. I guess I just can’t. I don’t want a return to the “nasty, brutish and short” life of Dickensian Britain, so I accept that we have to pay for a civilised society, while seeking to reduce the costs.
    Oh, and I agree about Blair and the benefits bill (good film title!), whatever happened to him…

  • Big Bog

    I’m not going to argue whether the public sector is doing a good job or not, that debate will never end, but I want to make the point that the public sector is simply not viable in its current form. It’s not economically viable to have such a large workforce funded from a weakened economy like ours. The illusionary wealth of the past ten years came from banking and inflated house prices. It allowed the public sector to justify boundless expansion. This is no longer the case – the private economy will barely be able to feed itself, let alone a bloated public sector too.
    Public sector pay is now higher than the pay of those that fund it, the gap between public and private sector pensions is an undeniable injustice. Once private sector employment inevitably falls dramatically over the next two years whilst public sector jobs increase aggresively we will be witness to an economic implosion. The private sector tax revenues will run DRY.
    I believe that most people (rightly or wrongly) do their jobs with the best of intensions. Public sector workers often do difficult jobs that no-one else wants, and cannot be done profitably in the private sector. As well intentioned as the public sector may be, the laws of economics ultimately will sweep away that which cannot be sustained.

  • http://www.philtaylor.org.uk Phil Taylor

    Your headline:
    COUNCILS EMPLOY 22% MORE MIDDLE MANAGERS THAN LAST YEAR
    is a pretty straightforward lie. A more accurate headline would be
    COUNCILS EMPLOY 22% MORE PEOPLE EARNING £50K-PLUS THAN LAST YEAR
    Not quite so newsworthy. Someone earning £49,999 in 2006/7 who had a £1 pay rise would swell your numbers so perhaps we can relax a little.
    It is worth tracking these numbers but call them what they are.
    It would be useful if you compared like for like. Districts, metropolitans, London Boroughs, etc. You might do something useful then (you would also spot errors such as you made with the population of Brent (270,000 not 71,600). It would also be pretty clear who was and was not including teachers. I think 3/4 of London boroughs do so you have badly overstated your case in London and probably overall.
    Up your game guys.

  • http://profile.typepad.com/DonaldG Don G

    I now have to pay more towards public sector pensions than I pay towards my own, comfortable pension.
    When businesses and households suffer financial hardship, they have to tighten their belts – postpone spending, hold off taking a new loan, keep the car for longer than usual, shed staff etc. Why therefore does our government wish to INCREASE spending our money, continue employing/recruiting, allow councils to increase tax “in line with inflation”?
    Our bloated public sector should be at least halved – I’d rather spend my money on what I want to, and to benefit my family.

  • Peter Phillips

    Always vigorously refending the indefensible of public spending on this forum, I don’t suppose Steve Robson is the same Steve Robson who used to be a Treasury manderin and then upon retirement (no doubt on an eye-watering final salary pension) became a non-executive director of RBS, sitting on the board all through the ABN Amro purchase fiasco, is he?