Retiring council chiefs got £270k ‘compensation’ Anger over unexplained payoffs as another former worker continued to be paid salary
OVER £270,000 in compensation was handed to two former council bosses after they retired – while one worker was mistakenly paid for several months after they left.
Members of Birmingham City Council’s audit committee posed serious questions over the ‘loss of office’ payments in particular but authority chiefs claimed the matter was confidential.
Concerns were raised that an undisclosed sum of money paid to the employee who resigned had yet to be recovered six months after the error was discovered.
The council’s statement of accounts for 2017/18 revealed that compensation totalling £190,909 was paid to Peter Hay, who retired on July 31 last year having served in the roles of chief education officer, director of children’s social care and director of adult social services.
Similarly, Paul Dransfield, a strategy director for major projects received £83,300 having retired on the same day.
Committee member Cllr Paul Tilsley (Lib Dem, Sheldon) took issue with the sums which were additional to the officers’ pension pots.
He said: “My understanding is both chose to retire. They gave their notice and then they pick up quite handsome compensation for loss of office.
“Why do we have to pay, on top of pension and everything else, compensation for loss of office?
“We are talking close on £200,000 for one individual and £83,000 for another one. They have also got what I would like to say are quite handsome pension pots.”
Committee chairman Cllr John O’Shea (Lab, Acocks Green) said he shared the concern adding: “If they retire they are leaving the business. Why are we giving them extra money?”
But Clive Heaphy, corporate director for finance and governance, refused to discuss the matter publicly, claiming both payments were “subject to confidentiality” and that he was “not a liberty to speak about them”.
It prompted councillors to take Monday’s meeting into a private session to pose further questions.
Earlier, auditors Grant Thornton had highlighted a ‘control weakness’ around people leaving the council.
They revealed one member of staff left in June last year but their resignation was not formally authorised until October.
While it was not until February this year the council realised the former employee was still being paid.
Mr Heaphy confirmed the debt was being recovered although the money had yet to be fully recouped.
Committee member Cllr Meirion Jenkins (Cons, Sutton Mere Green) said: “I’m concerned we have overpaid someone and not recovered the money.
“It is really important that if someone is overpaid in error we ensure that money is got back.
“It sends out an important message to the citizens of Birmingham that we are careful with our money and when something like this happens we take steps to get it back.”