East London councils part with six figures in employee pay-offs

East London councils have paid hundreds of thousands of pounds in settlements to ex-employees over just three years.

Between 2016/17 and 2018/19, Waltham Forest Council and Redbridge Council have paid around 30 settlements each, while Havering Council has paid 85.

This has cost Havering more than £914,000, Redbridge more than £685,000 and Waltham Forest more than £565,000.

The Taxpayers’ Alliance, which compiled the figures, noted that 45 local authorities, including some in populous areas like Liverpool and Belfast, reported no settlements at all.

Researcher Darwin Friend said: “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.

“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.”

TaxPayers’ Alliance data Havering council paid 23 settlements last financial year, compared to a UK average of just six.

A Havering Council spokesperson said settlements were used only “in exceptional circumstances”, such as employment disputes or to agree the terms of an employee’s departure.

They added: “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.”

While all three councils saw the number of settlements fall over the three years, the average cost of Redbridge Council settlements spiked.

In 2016/17, the average settlement cost less than £18,000, while last year the average was around £42,000.

A Redbridge Council spokesperson also pointed out settlement agreements were only used in “exceptional circumstances”, including delivering “vital efficiency savings through organisational restructures”.

They added: “However, payments are made in accordance with what people are entitled to. Settlement payments also protect the council from legal claims.”

Waltham Forest Council, who spent the least money on settlements out of the three boroughs, were keen to point out the trend of “year-on-year reduction”.

A spokesperson said: “It is important to note that settlement totals include any wages due under the terms of an employment contract.

“We expect to see a fluctuation in settlement figures from year to year. Our total and average payments compare favourably with figures for other London boroughs.

“We are unable to discuss the details of individual settlements.”

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Mick Ferris

Editor Email: [email protected]