Chief exec John Foster: I don’t need to justify pay-off

Published: 19 March 2010
by RÓISÍN GADELRAB

THE Town Hall’s chief executive has told the Tribune he should keep all the £545,000 pay-off from his last job – even though he walked straight into another top local authority post.

In an exclusive, frank interview, John Foster defended his current £210,000 salary, which means he earns more than Prime Minister Gordon Brown.

The Audit Commission investigated his pay-off from his last job as chief executive at Wakefield Council on the grounds that he so soon afterwards was appointed to another highly-paid local authority role, in Islington. He defiantly said he had been paid well for being a “very successful chief executive”.

Meanwhile, the Tribune can today (Thursday) reveal that in Islington 25 senior staff – 21 council employees and four from private company Cambridge Education (CE), which is paid by the borough to run its schools  – earn more than £100,000.

The pay revelations come in the same week that the Audit Commission published its investigation into chief executive pay-offs at Town Halls up and down the country. Mr Foster insisted councils should not claw back pay-offs to Town Hall chiefs who move to other high-paid local government posts. 

The Audit Commission report recommends that councils should be able to “recoup some of a pay-off where an executive moves quickly into another top council job”.

Of the pay-offs studied by the commission, on the orders of Local Government Secretary John Denham, Mr Foster’s was the only one involving a chief executive who moved to the same post elsewhere.

Asked whether part of his pay-off should be returned, Mr Foster said: “No, because it’s not about reclaiming money. The cases the commission identified are primarily where the political leader of a council decided they want to work with a different chief executive.” Mr Foster said he left Wakefield Council for that reason.

“I happened to have been a very successful chief executive but he [the council leader] was seeking to terminate my employment,” he said. “I had employment rights like every other employee and the council had to negotiate with me within employment law.

“I don’t feel I need to justify it. My case is raised because I happen to be one of those handful of chief executives in 2008 affected by these political decisions.” 

Mr Foster, who is 61, added: “Are people saying I wasn’t entitled to try and continue my career? I feel I still have a lot to contribute as a very experienced local government chief executive. There are too many experienced senior people in local government retiring too early and the service is losing their skills and accumulated experience.”

Asked if he thought it was acceptable that some council chiefs earned more than the PM – his salary is £15,000 above that of Mr Brown – he said: “Yes, because it’s not comparable. Prime ministers and MPs are paid by decisions of parliament. In the UK they tend to be on the low side compared to Europe and America. But comparing a local government chief executive’s role with that of a PM doesn’t make sense because... there’s a whole set of arrangements around the PM. They have incredibly generous pension entitlements...”

The Audit Commission report urges councils to publish details of pay-off packages “within a short time”.

Mr Foster said people “misunderstood” how public sector pay-offs were arranged. “Any pay-offs have to be done within the regulations and rules which apply to that service... The cases the Audit Commission are referring to have all been dealt with through these regulatory processes so people are not inventing these resolutions off the top of their heads,” he said.

Rebel Lib Dem councillor Andrew Cornwell is preparing to take a motion to the next full council meeting demanding the publication within a month of all salaries, expenses, pensions, contributions and other benefits for council staff earning more than £75,000.

Mr Foster said: “I’d already agreed with the corporate director team, before I was  aware of Andrew’s motion, that we would publish on the council’s website the list of those officers earning over £100,000.”

He “wouldn’t mind” if the council passed Cllr Cornwell’s motion, adding: “If that’s the council’s will we’ll publish all those details.” Mr Foster’s salary and expenses – he does not have a council pension – are already on the council website.

But he feared that lowering the threshold for published salaries to £75,000 could cause problems. “I’ve no objection but it increases the number of officers and includes many who are not senior managers but it’s simply because of their professional role... It would include every headteacher, I would imagine, across Islington schools. In secondary schools it would include virtually all deputy heads,” he said.

High salaries were necessary “because people who take the top jobs are a scarce commodity”, Mr Foster said. 

“The fact that over 3,000 people in the NHS employed directly by the government earn over £150,000 will be a surprise probably to members of the public but it is a reality, it’s the way services are run,” he added.

The council’s salaries were in line with those at other London boroughs, Mr Foster maintained. “There’s nothing exceptional about the pay system for senior directors in Islington,” he said.

“The main benefit any local government employee receives is the pension. In local government, [it’s] made up of contributions from employee and employer. Because it’s a final-salary scheme the more they earn the larger their final pension is going to be. But the average pension for most people is relatively low, about £4,500.”

He intends to stay until June next year when his three-year contract with Islington ends.

Top earners – Town Hall £100,000 club

 

THE 21 council officers who earn more than £100,000 are: 

• John Foster, chief executive – £210,000;
• Eleanor Schooling, corporate director, children’s services – £145,152;
• Kevin O’Leary, director of environment and regeneration – £134,479;
• Louise Round, corporate director, resources – £132,102;
• Mike Curtis, corporate director, finance – £129,741;
• Sean McLaughlin, corporate director, housing and adult social services – £117,552;
• Brahmesh Kainth, director, public realm – £110,451;
• Seema Manchanda, service director, strategic planning – £110,445;
• John Lowin, service director, IT – £107,970;
• Thanos Morphitis, service director, strategy and commissioning – £107,970;
• Jan Hart, service director, public protection – £105,435;
• Fran Stewart, director of Building Schools for the Future – £104,854;
• Lela Kogbara, director of strategy and partnerships – £104,134;
• Dawn Wakeling, service director, adult social care  – £103, 011;
• Patrick Odling-Smee, service director, housing – £103,011;
• Andy Nutter, director, financial governance and transformation – £100,593;
• Ian Adams, director, financial operations – £100,593;
• Alan Layton, director, financial management – £100,593;
• Debra Norman, director, legal services – £100,593;
• Cathy Blair, director, child protection – £100,593;
• Maria King (now left), director, human resources (£100,000-£107,970).
• Four officers employed by Cambridge Education earn more than £100,000.

In Islington, 50 council staff earn more than £80,000 – 29 directly employed by the council and another 21 who work for Cambridge Education.

These figures do not include staff at Homes for Islington, the arms’-length management organisation responsible for the borough’s council housing.

Details of top salaries, without names, now appear on the council website at www.islington.gov.uk/Council/councilstructure/chief_exec/senior_pay_expe...