It has been announced that external auditors are to investigate Thanet Council settlement agreements following a complaint that was received from a former councillor.
Thanet Council Settlement Agreements
After receiving details about the Thanet Council settlement agreements following a freedom of information request, former councillor, Ian Driver, submitted a complaint by letter in which he stated: "I wish to make an objection about the management of non-disclosure agreements (NDAs) agreed with departing council staff during the 2019-20 financial year. According to a Freedom of Information request I submitted to the council the organisation spent £268,000 in 2019-20 on securing NDAs. This request was made in early March 2020. I suspect that the actual figure may be higher. I have reason to believe that one of those NDAs was agreed between the Council and [a] former employee [who] is reported to have made very serious allegations of bullying."
The total amount paid out under Thanet Council settlement agreements between April 2015- August 2019 was £446,503.00 to over 30 employees.
The number of freedom of information requests made in relation to settlement agreements and the amounts paid out under them by local authorities and councils has been increasing in recent years.
Investigation In To Thanet Council Settlement Agreements
Commenting upon the investigation into the Thanet Council settlement agreements, a representative for Grant Thornton stated: "During 2019/20 a number of matters were brought to the auditor’s attention regarding grievances and the arrangements in place to respond to those grievances. As part of our value for money conclusion we are reviewing the arrangements the council has followed to respond to the grievances."
A spokesperson for Thanet Council stated: "An objection has been received and is being handled in line with standard procedure. That won’t prevent the auditor from concluding the audit on our financial statement of accounts. It is not unusual for an external auditor to have not resolved all objections by the time the accounts are agreed. Approval of the accounts was deferred to a future meeting due to a separate technical issue regarding asset valuations."
Freedom Of Information Requests
As highlighted above, the investigation into the Thanet Council settlement agreements followed a freedom of information request. In the last few years, freedom of information requests regarding how much has been paid out under settlement agreements by local authorities and councils has been on the increase. For instance, one freedom of information request revealed that Walsall Council had paid out £434,571.16 in relation to 30 settlement agreements between 2015 – 2018, with the largest pay out being £58,603.00, and with an average pay out across the 30 settlement agreements of £14,485.71. Another freedom of information request found that Leicester City Council had paid out £531,716 in relation to 36 settlement agreements between 2016 and 2018, with the largest pay out being £62,000.00, and with an average pay out across the 36 settlement agreements of £14,769.00. Moreover, yet another freedom of information request revealed that between 2013 - 2017, Devon County Council paid out £1,965,370 on 145 separate settlement agreements.
Public Sector Exit Payment Cap
The latest freedom of information request in relation to the Thanet Council settlement agreements follows close on the heels of The Restriction of Public Sector Exit Payments Regulations 2020 coming into force on the 4th November 2020, which limit such payments to £95,000.00.
