Council considers pay restructure for senior staff

Anthony Lewis, local democracy reporter

An increase in directors’ pay could cost a council an extra £33,000 a year as the authority aims to address challenges with recruitment and retention.

A proposal to Merthyr Tydfil Council on Wednesday, November 6 includes repositioning director roles from tier four to tier three to ensure the council remains competitive and the adoption of a four-point salary scale to help attract and retain the necessary talent to lead Merthyr Tydfil through current and future challenges.

Figures

Changes to band B roles would see B1 increase from £81,555 to £90,500, B2 increase from £83,979 to £94,500, B3 to rise from £86,403 to £98,500 and finally B4 increasing from £88,826 to £102,500.

This would take the total cost from £429,588 to £488,500, an increase of £58,912, but getting rid of the deputy chief executive post and replacing it with a head of regeneration post would save £34,498 in a full year (down from £108,011 to £73,513).

The additional salary cost would therefore be £24,414 but the total additional full year cost is £33,104 including employer’s national insurance and pensions contributions.

Challenges

The report describes the key challenges including uncompetitive salary levels with current director salary packages being in the lower quartile for the region, making it difficult to attract high-calibre professionals to leadership positions.

Another challenge is recruitment difficulties, with previous attempts to fill key roles having resulted in low application numbers and the need for multiple rounds of recruitment.

And there are retention issues with a growing risk that directors will be drawn to external opportunities, particularly remote roles offering higher pay and lesser responsibilities, which increases the likelihood of losing talent to competitors with more attractive remuneration packages.

Competitive

The report said that a strong and competitive remuneration package is vital to securing and maintaining leadership talent capable of driving the council’s strategic goals and that effective leadership at the director level is essential for ensuring long-term sustainability, service delivery, and financial management within the council

It said: “The issue of director remuneration remains a critical concern for the sustainability and effectiveness of the council’s leadership.

“Recent recruitment efforts have highlighted the difficulties faced due to uncompetitive remuneration, with key positions remaining unfilled or attracting only a small pool of candidates.

“Benchmarking has shown that Merthyr Tydfil County Borough Council’s director salaries are significantly lower than comparable councils in south and mid Wales.

“This has resulted in challenges in both attracting and retaining top-tier candidates.”

Adjustments

It also said that an independent review conducted by Anne Phillimore FCIPD (Fellow of the Chartered Institute of Personnel and Development) provides a
comprehensive analysis and benchmarking of the council’s remuneration levels against other public sector organisations.

The findings show a “clear need” for adjustments to ensure “that we can build and maintain a strong leadership team capable of driving the council’s strategic and operational goals.”

The report said that with all director salaries already below regional benchmarks, this is “essential” to stay competitive and raising salaries to match regional standards is “crucial.”

It also said that addressing directors’ remuneration would enhance the council’s flexibility, allowing it to better adapt to changing demands as, with competitive salaries in place, directors could more readily take on varied or expanded roles as needed enabling the council to respond quickly to new challenges and strategic priorities.

Opportunities

The report said that due to current vacancies/recruitment process there will be variation in the initial full year effect and opportunities for ongoing savings will be explored in the event of an internal candidate being appointed to the vacant post.

It said the existing and proposed salary band structure has a number of pay points dependent upon length of service and the financial implications of these proposals will be factored into the council’s medium term financial plan going forward.

As part of the proposed corporate restructure after the deputy chief executive retires in January 2025, the economic, regeneration and public protection portfolio currently held by the deputy chief executive would be reallocated across existing departments.

A new head of service role for economic regeneration and housing would be created with the post of deputy chief executive being removed.

Public protection would be transferred to the director of governance and resources and the responsibility for estates, property services, procurement, creditors and the commercial unit would be managed by the director of finance.