Pay rises reined in for bosses

The growth in the salaries of public sector chief executives has slowed but one is still making more than $800,000.

The latest public sector pay report shows the average salary increase for chief executives at government departments slowed to 0.9 per cent in the year ending June, down from 2 per cent the year prior.

Crown entities, whose boards set their chief executive’s pay with advice from the State Services Commissioner (SSC), had an average salary bump of 2.6 per cent – down from 3.5 per cent the year prior.

The average chief executive base salary in the public service was 5.3 times the pay of their average employee – a drop from 5.8 in 2013.

The Government has welcomed the news as proof its moves to limit these pay increases by getting rid of performance pay are working.

ACC’s Scott Pickering was the best paid public sector chief executive with a salary band of $830,000-$839,000 – up $10,000 from the year prior, when the board had disagreed with SSC advice.

Traditionally the head of the Superannuation Fund is the best paid public servant, and draws negative headlines for it.

But since Adrian Orr left the job part-way through the year to lead the Reserve Bank, his $1.2m salary does not show up and the salary for the man acting in his old role is not obvious.

Pickering was one of many chief executives paid more than $500,000.

Next up was Police Commissioner Mike Bush on $700,000-$710,000, followed closely by then Defence Force chief Tim Keating on $670,000-$679,000.

These two salaries are set by the Remuneration Authority.

The best paid head of a government department was Inland Revenue’s Naomi Ferguson, who made between $670,000 and $679,000.

She was followed by the heads of Internal Affairs, Social Development Oranga Tamariki, and Treasury. The lowest paid head of a government department who worked a full year was the Serious Fraud Office’s Julie Read, who made $350,000-$360,000.

The pay for chief executives of district health boards varied wildly – from $330,000-$339,999 for South Canterbury DHB head Nigel Trainor to $650,000-$659,000 for Waitemata DHB head Dale Bramley.

The population catchment area of DHBs can also vary wildly however: Waitemata takes in 597,510 people while South Canterbury takes in roughly a tenth of that.

State Services Minister Chris Hipkins expected pay increases to slow further. ‘‘State sector chief executives have big important jobs that carry a lot of responsibility, and they deserve to be fairly paid, but they are still public servants with an accountability to taxpayers.’’

State Services Commissioner Peter Hughes earlier in the week rejected criticism for giving chief executives an extra week of paid leave in exchange for forgoing performance pay. Hughes said it was a reasonable trade off and would save taxpayers millions.