Council looks to cut jobs to cope with rising costs of equal pay bill
JOB cuts are looming at Glasgow City Council as it looks to reduce the workforce to cope with the ongoing bill for the equal pay settlement.
The council is to open a voluntary redundancy scheme to reduce the total wage bill.
It said it is necessary to cope with ever tightening budgets and also ongoing costs following the equal pay deal agreed last year.
The council has to finance loan deals, which total hundreds of millions, from selling off key assets to City Property and then financing the deal through annual budgets to pay the settlements.
A £195million loan was agreed between city Property and Canada Life in October last year, to buy the Riverside Museum, Tollcross International Swimming Centre, Glasgow Royal Concert Hall, Gorbals Leisure Centre and Toryglen Football Centre and lease back to the council.
Another for £285m was struck with Legal and General earlier last year and a £166m, 30-year loan was then agreed with Canada Life Investments in September 2019.
There is also a new pay and grading structure to be implemented which will see average salary costs rise.
The council admits a new pay and grading structure cannot be put in place “without significant costs”.
In a report to councillors, Carole Forrest Director of Governance, said: “That average earnings will increase appears unavoidable and this, it is suggested, is an inevitable consequence of the decision to settle Equal Pay.
“The total number of employees and hence the total pay bill is, however, subject to a degree of control.
“It is proposed that it would be prudent to seek to reduce the overall size of the workforce.
“That requires service reform and these reforms will require access to voluntary redundancy to be successfully delivered.”
The report adds the council’s current policy provides a redundancy payment of up to 66 weeks pay for those with no access to immediate payment of pension and up to 30 weeks pay for those who have.
Ms Forrest states:
“The purpose of a redundancy scheme is to provide the Council with a means to manage its workforce.
“To be effective, therefore, redundancy terms need to be attractive to employees.
“This attractiveness, needs to be of against a requirement the exercise is also effective.”
The scheme, which will run for three years, will launch with a “trawl for registrations of interest” by June 30. however, set that cost