Senior management pay levels are often perceived as being excessive in comparison with many other posts both in the public sector and, indeed, in the private sector. But this issue has been brought into sharper focus in the National Assembly for Wales recently due to the publication of a report which found that a number of Wales’s top civil servants earn more than the First Minister, and some local authority chief executives are being paid at a rate of more than twice that of their peers.
Members of the public have a right to question whether it is appropriate that the chief executive of Betsi Cadwaladr University Local Health Board should receive a £200,000 salary and then a severance payment of hundreds of thousands. They also have a right to know why Pembrokeshire County Council’s chief executive should receive a salary of £194,000, while Conwy’s gets around half that.
It was issues like these, along with a number of public interest reports on pay and controversial pay-offs for former chief executives, that prompted the National Assembly’s Public Accounts Committee (PAC), which I Chair, to produce a report to consider the pay arrangements for senior managers.
The committee took evidence during the first half of 2014. It explored the reporting requirements and the decision-making processes regarding senior managers’ pay, and considered a broad range of taxpayer-funded organisations in order to build a comprehensive picture of pay arrangements across the public sector.
Whilst we saw some examples of good practice in terms of reporting on senior manager pay, we also found that some organisations failed to comply with the minimum legal requirements.
We also found that it was sometimes difficult to make comparisons between pay arrangements between similar organisations due to differences in reporting from one organisation to the next. We were concerned about these findings, as we believe that it is vital that the information on senior pay levels in the public sector is clear and accessible to allow for effective scrutiny and an informed public debate.
The Committee recommended a raft of measures to boost accountability to taxpayers and eradicate inconsistencies in reporting of pay for top officers in its report. If implemented, these will ensure that all organisations which receive significant funding will be required to publish details of senior management pay in a prominent place on their websites in a format which is digestible and sufficiently detailed for the public to see salary, benefits, pension and payoffs easily.
I am very pleased that the Welsh Government accepted all of the recommendations made by the Committee and have undertaken to incorporate these into their ongoing work to develop a Welsh Public Sector Pay Policy.
I, like many others, have long believed that some senior public sector salaries in Wales are unjustifiable. It is crucial that we put an end to this and ensure much-needed transparency and clarity in this area in the future.