Leicester City Council: Cuts to senior management save £2.6m in wages

SENIOR manager numbers in Leicester City Council have fallen by more than a third in the last five financial years, saving the council £2.6m in wages. The figures are in the council’s latest pay policy 2017/18 report, which is due to be considered by full council tonight (Thursday, March 16).

The report shows that the highest earner at Leicester City Council earns £130,048 a year, compared with £161,600 in Derby, £170,000 in Nottingham and £175,000 in Coventry. This means the highest earner’s pay is 5.7 times more than the average staff pay, compared to over eight times more in Nottingham and Coventry.

Over recent years the council has worked hard to control senior pay and reduce spending on senior management. Overall the number of staff employed by the city council has decreased since 2012/13, with the reductions including a large number from senior posts. In all, the number of posts among directors and heads of service has fallen by over a third (35 percent), from 125.5 posts in 2012/13, down to 82 in 2015/16.

It also means that the total pay bill for senior management has fallen by 29 percent. For example, the pay bill for senior management in 2011/12 was over £9.1m, and by 2015/16, this bill had fallen to just over £6.5m. Across the council, staff numbers have fallen by 681 full-time equivalent posts from 2012/13 to 2015/16 – a reduction of about nine percent.

The city council employed 7,478 non-school staff in 2011/12, of which 1.67 percent were senior management. By 2015/16, that had fallen to 6,782, of which just 1.21 percent were senior managers. This means that the bill for overall staff wages has been reduced by 11 percent – from £184m to £163.5m – a saving of over £20m.

Only six percent of these savings has come from the lowest pay grades (Grades 1-3), with eight percent coming from the next highest pay grades (Grades 4-6). Between them staff at Grades 1-6 make up about 64 percent of the council in 2015/16.

Despite the fall in staff numbers, the workforce has remained largely consistent in terms of the percentage at each pay grade.Only a small percentage of staff – about two percent – are on the highest pay grades (Grade 13 and upwards).

Leicester City Mayor Peter Soulsby said: “Across the council, staff reductions have meant savings of over £20m, of which £2.6m comes from cutting senior management alone. It is reassuring to know that the comparatively few senior management positions at the council is bearing the brunt of these cuts, rather than just lower-paid workers, who comprise far more of the workforce.”

“Our highest paid staff make up just two percent of the workforce, but account for more than six percent of the overall job reductions and 10 percent of the savings to the wage bill since 2011/12. Despite having to make these savings, we’ve managed to maintain a balanced make-up the council, with no disproportionate impact of job losses on lower grades.”