A report compiled by the TaxPayers Alliance has found that Brent Council Spent £516,151.00 on 13 settlement agreements during the financial year 2018-19.
13 Settlement Agreements
In spending £516,151.00 on 13 settlement agreements during the financial year 2018-19, Brent Council paid out the 4th highest amount of compensation in London in total, and the 10th highest overall in the whole country. The average pay out by Brent Council was £39,703.92.
The TaxPayers Alliance Report
Between 2016-19, the report by the TaxPayers Alliance found that local authorities entered into 6,980 settlement agreements overall, with £98,059,105,00 paid out in aggregate. The average payout was £14,048.59. This is well below the Brent Council average of £39,703.92.
The highest total amount paid out during the years 2016-19 was by Stoke-on-Trent City Council, who paid out £8,552,433.00 in relation to 371 settlement agreements, which was also the highest number of agreements entered into by any one Council. This included a pay out of £195,463.00 to just one particular individual, the highest known individual pay out by a local authority during the 3 period. The average pay out by Stoke-on-Trent City Council was £23,052.38, again well below the Brent Council average of £39,703.92
The highest average payout during the 3 year period was by Basingstoke and Deane Borough Council, with an average payout on their agreements of £79,628.00. That Council paid out a total of £398,139.50 on 5 settlement agreements
Statement
Commenting on the findings for the the TaxPayers Alliance, representative Darwin Friend stated: “Though settlement agreements are sometimes necessary, councils need to remember that it’s ratepayers who foot the bill. These settlements have been signed at the same time that the vast majority of local authorities have increased council tax, meaning some have spent huge sums on hush money while hiking up local rates.“
Friend added: “Given that almost 50 councils have managed to spend nothing on these deals, it should be perfectly possible for those paying the most to do better and keep down the costs of individual golden goodbyes.“
Brent Council Response
A representative for Brent Council responded to the findings of the report compiled by the TaxPayers Alliance regarding their settlement agreements by stating: "The council may enter into a settlement agreement, about the ending of an individual’s employment, to provide a mutually acceptable outcome and avoid protracted and costly legal disputes. In each case, a settlement provides certainty for the council and the employee."
Freedom of Information Requests
The statistics used in the TayPayers Alliance report, including on the 13 settlement agreements that were entered in to by Brent Council, were obtained through the making of freedom of information requests. Furthermore, a substantial number of freedom of information requests have been lodged by the media over the last few years, given that considerable amounts of money have been paid out by local authorities, which have come under growing scrutiny.
One freedom of information request revealed that between 2016 – 2018, Leicester City Council paid out £531,716.00 on 36 settlement agreements. The highest pay out was £62,000.00, with an average payout of £14,769.00.
A representative for Leicester City Council stated at the time that: "Settlement agreements are most commonly used where it is considered that it is in the best interests of the council to reach an appropriate and swift conclusion to circumstances which could otherwise cause operational disruption, management downtime and/or unnecessary additional financial cost....The use of settlement agreements helps to protect the council against the risk of future claims that may be made by ex-employees."
The representative added: "We always seek to get the best deal for the council and our use of public funds, just the legal costs and time involved in defending even a completely unfounded or hopeless employment tribunal case can be several tens of thousands of pounds."
NHS Trusts
Other sectors of society that have also come under scrutiny in relation to their settlement agreement pay outs and which have been subject to freedom of information requests, are NHS Trusts as we highlighted in a recent article
