A report compiled by the TaxPayers Alliance has found that Havering Council paid out £914,494.00 on 85 settlement agreements in just 3 years between 2016-19.
85 Settlement Agreements
The report produced by the TaxPayers Alliance looked into how much local authorities had paid out on settlement agreements between 2016-19. They found that local authorities had entered into a total of 6,980 settlement agreements with their employees during that period. The total amount paid out under these settlement agreements was £98,059,105,00, with an average payout of £14,048.59.
The report found that Stoke-on-Trent City Council had made the highest payout during the 3 years in question, which amounted to £195,463.00. The same Council also entered into the most number of settlement agreements with its employees, with a total of 371 settlement agreements. Meanwhile, Basingstoke and Deane Borough Council had the highest average payout, with its settlement agreements averaging £79,628.00.
The 85 settlement agreements that Havering Council entered into between 2016-19, in which they paid out a total of £914,494.00, had an average pay out of £10,758.75. In terms of what the 33 London Boroughs spent on settlement agreement pay outs during this period, the total paid out by Havering Council on their 85 settlement agreements was the seventh highest.
In terms of a break down of the 85 settlement agreements, during the 2016/17 financial year, Havering Council entered into 36 settlement agreements, with a total pay out of £396,942.00, and an average pay out of £11,026.17. In 2017/18, the Council entered into 26 settlement agreements, with a total pay out of £245,465.00, and an average pay out of £9,440.96. Whilst in 2018/19, the Council entered into 23 settlement agreements, with a total pay out of £272,087.00, and an average pay out of £11,829.87.
Furthermore, the report by the TaxPayers Alliance found that London had the highest level in terms of the total value of its payouts in 2018/19 at £5,819,520.00. Moreover, the South East during that same year was the region with the highest number of settlement agreements with 381.
Sam Packer from the TayPayers Alliance told Time 107.5FM that: "Every pound that is spent on a settlement agreement is money that is either being charged through council tax or isn’t being spent in other areas. We’re not saying that all settlement agreements are terrible and they should all cease but we are merely trying to draw attention to the fact that there is a big difference."
Packer added that: "Hopefully the public will recognise that their councils aren’t necessarily spending their money in the best way possible and hopefully public pressure will pay off. Our hope would be that we can get councils to spend less taxpayers’ money and, in so doing, charge less council tax."
Freedom Of Information Requests
The data the TayPayers Alliance obtained for the survey, including on the 85 settlement agreements that Havering Council entered to, was obtained through the making of freedom of information requests. Indeed, more and more freedom of information requests of this nature have been made in recent years, as the amounts being paid out by local authorities in relation to settlement agreements have come under growing scrutiny.
Only recently, following a freedom of information request, it was revealed that the City of York Council had paid out £523,427.00 in relation to 33 settlement agreements that it had entered into with former employees during a 4 year period between 2016 –20. The average pay out by the City of York Council on the 33 settlement agreements was £15,861.42.
Reaction From Havering Council
In response to the TayPayers Alliance findings re the pay outs on the 85 settlement agreements, a representative for Havering Council told Time 107.5FM that: "We only use settlement agreements in exceptional circumstances, when there is an employment dispute between the Council and an employee either to agree the terms of their departure or to resolve disputes with existing employees, where their employment is not to be terminated."
The representative for the Council added: "Between 2016 and 2019 a number of cases were resolved via a settlement agreement. In November 2019, the Council introduced a protocol to reduce its expenditure on settlement agreements and to cut down on the expectation that poor performance or conduct will be rewarded in a financial agreement. It also aims to reduce any perceptions that we will avoid tackling management issues."
