The beginning of this month brought the release of Town Hall Rich List 2021; our yearly publication in which we reveal the sheer scale of the pay, perks, payouts and pensions afforded to council fat cats. The findings are always shocking, but taxpayers are begrudgingly familiar with the formula - council bosses receive bloated financial packages while notching up rates on local residents.
Here are ten key takeaways from this year’s Town Hall Rich List:
At 2,802 people, this is the highest number of officials on more than £100,000 since 2013-14. Compare that to the rest of us: the median annual earnings for full-time employees at the end of 2020 was £31,461. Overtaxed workers in the private sector (many of whom will have seen their incomes and prospects diminish this year) are bound to question the justification for these enormous financial packages.
693 officials received over £150,000. The average number receiving over £150,000 is 1.7 employees per council, meaning, on average, each council has at least one official on more than the Prime Minister.
Loss of office payments continue to significantly increase remuneration levels. These enormous ‘golden goodbyes’ are beyond anything most people could dream of. The highest remunerated council employee in 2019-20 was the deputy chief executive at Coventry council, receiving £573,660 in total remuneration. This included a staggering loss of office payment of £395,110 - the largest in the country.
A total of 21 local authority employees received a loss of office payment of more than £95,000. In 2015, the TPA proposed a £95,000 cap on golden goodbyes, which entered the Conservative manifesto and became law in 2016. It wasn’t until five years after that ministers forced reluctant civil servants to finally implement the cap; but after only three months, Whitehall mandarins and union bosses managed to get it overturned. We’re petitioning the government to get the cap reinstated.
Council subsidiary bodies, owned (though not necessarily fully funded by) local authorities, pay generous bonuses. The local authority to pay out the highest amount in terms of bonuses and performance-related pay to a senior employee was Edinburgh city council, with the general manager of Edinburgh Trams receiving a £48,895 bonus. Managing directors of three such bodies in Newham received over £127,339 in bonuses between them.
Total expenses paid to senior employees in the UK amounted to £1,274,497, with the highest amount (£38,043) being claimed by Simon Baker, the now former chief executive of High Peak borough council.
Working class taxpayers especially are sick of council tax rises. In polling conducted by the TPA, 61 per cent of people said they would oppose an above-inflation council tax increase this year, compared to 15 per cent who would support it. By 64 per cent to 16 per cent, C2 voters said they opposed an above-inflation council tax increase, with DEs opposing it by 65 per cent to 8 per cent. ABs (or the professional classes) opposed it by a much narrower margin of 51 per cent to 25 per cent. The poorest households are the ones being most ignored.
There is widespread agreement that there are ways to keep council tax down while maintaining good council performance. 59 per cent of people support the idea that councils should freeze or cut salaries of senior staff, while 45 per cent of the public also believe that this would have an impact in keeping council tax down. Asked about the general effectiveness of the chief executive of their local council, 31 per cent of people didn’t know whether they were effective, rising to 39 per cent of DEs. If council bosses want to be able to justify these remuneration packages, they need to better demonstrate competency.
Every year, councils claim this information is already available. But data is tucked away on websites, or in annual reports (which is where we find it). Where savings have been made, we are ready to praise them - such as in County Durham, where they have reduced their number of execs receiving over £100,000 from 26 to 7 since Town Hall Rich List 2020. If councils are making savings, they should recognise the importance of doing so by contacting the TPA and letting taxpayers know.
This is the 14th edition of Town Hall Rich List, which shines a light on how nearly £380 million of taxpayers’ hard-earned cash has been spent. While numbers fluctuate, the narrative remains the same - council tax rises, bumper remuneration for bosses and no improvements to local services. Without meaningful change, this status quo will persist and taxpayers will continue to lose out.