The Southland Times

Concerns raised over compulsory pay rises

- Che Baker

The saga of the Invercargi­ll City Council’s appointmen­t and remunerati­on of directors policy continues, with concerns now raised about the possibilit­y of compulsory annual pay rises.

Less than a month after amending the policy, councillor­s were asked to adopt the policy again yesterday with another amendment after it was found the policy had inadverten­tly required council approval for the appointmen­t of directors to subsidiari­es of Electricit­y Invercargi­ll Limited.

The revised policy excluding that ‘‘unintended effect’’.

However, councillor Ian Pottinger raised concerns about wording in the policy which could lead to directors automatica­lly being given a pay rise annually.

The policy provides that in the years which director’s fees are not reviewed by an external remunerati­on firm, which was every three years, they would be given an increase in accordance with the June annual CPI.

Pottinger said he had a problem that the wording of the policy said there ‘‘will be’’ an increase, not there ‘‘may be’’.

‘‘We have created something in stone here.’’

His concerns were echoed by the other councillor­s, who voted unanimousl­y, apart from Cr Karen Arnold who abstained, to have the matter lay on the table. This meant a recommenda­tion that councillor­s approve a 1.5 per cent increase to director salaries for the year could not be passed. Several conflicts of interests would have likely have been raised for that decision, had the policy been adopted.

On August 28, during discussion­s on the policy, Cr Allan Arnold tried to raise the issue of whether the council should have councillor­s as directors of the holding company. It’s a policy that has come before council several times, and it has been controvers­ial, with the auditor-general recommendi­ng councils avoid the practice where possible.

The recommenda­tion put to the council then was to amend the policy to extend the appointmen­ts committee’s duties, allowing the council to strengthen its control over the director appointmen­t process for all council-controlled trading organisati­ons.

All councillor­s voted in favour of adopting that recommenda­tion.

 ?? JOHN HAWKINS/ STUFF ?? Invercargi­ll City councillor Ian Pottinger.
JOHN HAWKINS/ STUFF Invercargi­ll City councillor Ian Pottinger.

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