PART 1
(OPEN TO THE PUBLIC) / ITEM NO. 10
REPORT OF
Chief Executive
TO THE COUNCIL
On
16th May 2012
TITLE: Members Allowances Scheme.
RECOMMENDATIONS: THAT
The Council
(1)Approve the proposed temporary changes to the Members Allowance Scheme as detailed in the report to take account of the changes in the Council’s governance model. These changes will be temporary measures pending the proposed independent review
(2)Approve that the Chief Executive conduct a full review of the scheme for Members allowances using an independent Remuneration Panel which will conclude its findings for further reports to the Council in July and September 2012.
Conclusion
  • The purpose of this report is to temporarily amend the existingMembers allowance scheme to reflect the changes in governance arrangements and
  • To allow for an independent review of the current scheme in light of the new Mayoral governance arrangements and as the scheme has not been reviewed since its implementation 2006

BACKGROUND DOCUMENTS:The Council Constitution
(Available for public inspection)
KEY COUNCIL POLICIES:The Council Constitution.
______
EQUALITY IMPACT ASSESSMENT AND IMPLICATIONS:
All issues of equality are considered as part of the scheme ______
ASSESSMENT OF RISK: High the current scheme does not include the position of Elected Mayor without an approved scheme no allowances can be paid
SOURCE OF FUNDING:N/A
LEGAL IMPLICATIONS: The current scheme does not include the positions of Elected Mayor, Deputy Mayor, Strategic Assistant mayors or Assistant Mayors.Without an approved scheme no allowances can be paid.If the full scheme is to be reviewed a Panel has now to be reconvenedand to consider and recommendany amendments to the Scheme of Allowances to Members in accordance with the Local Authorities (Members’ Allowances) (England) Regulations 2003 (SI 2003/1021).
FINANCIAL IMPLICATIONS: Minimal impact upon existing budget, full details are included in the report.
CONTACT OFFICER:Martin Vickers Strategic Director of Customer and Support Services/Vin. Joseph Head of Democratic Services
TEL. NO.7933407/7933009
WARD (S) TO WHICH REPORT RELATE (S): All

Proposed temporary changes to the Members Allowances scheme

1.Introduction

1.1 Salford City Council’s current Members’ Allowances Scheme is made under the Local Government and Housing Act 1989 and the Local Government Act 2000 and in accordance with the Local Authorities (Members’ Allowances) (England) Regulations 2003. Full details of the current scheme are shown at Appendix A.

1.2 Following the election of the City Mayor, it is necessary that this scheme is amended as a result of the introduction of this new role but also due to the statutory requirement that the allowance of the Elected Mayor is subject to a review by an Independent Panel ultimately for a final decision by the Council.It is proposed that the Chief Executive progress the immediate appointment of an independent Panel following Council which will comprise of up to 4 independent advisors. The scope of the review will be to undertake a comprehensive review of the full Members Allowances scheme in light of governance changes but also in view of the fact that the scheme has not been reviewed since 2005.

1.3Discussions have already taken place with Authorities who have been through the Mayoral process and also within the region about similar independent review models and useful information has been gained about;

  • the composition of the Panel
  • the evidence which it is able to call upon and the representations which it is likely to receive
  • the likely timescales for bringing the review to a conclusion

At this stage, it is envisaged that the review will be finalised to bring back it’s recommendations for consideration as follows;

  • For the post of City Mayor and Deputy City Mayor- July Council

These positions will be the initial focus of the review as they are fundamentally new roles where there is no direct comparison with previous roles in terms of strategic and legal responsibilities.

  • For all other Member positions-September Council

This review is positioned to provide final recommendations by September 2012 so that it will be aligned with various other reviews for example, the review of the Scrutiny model.

Following the review of Members allowances, it is intended that any final agreed recommendations will be backdated accordingly.

1.4 It will be necessary during the transitional period up to September 2012 that temporary measures are put in place to ensure payment for some members of the Mayoral Team, a full schedule of those proposals are shown at 1.5. At this stage, it is not planned for the City Mayor to receive any allowance during the transitional period pending the outcomes of the independent review in July 2012.

1.5 The following proposals seek to ensure that these key principles are adhered to;

  • That the cost of the transitional scheme is broadly aligned to the costs of the current scheme
  • That the opportunities to “freeze” allowances at present 2011/12 levels are maximised
  • That in presenting any new options they are based upon reasonable comparison with present payments under the current scheme

1.6 The proposed transitional measures therefore are as follows;

Position / Annual Allowance
£
City Mayor
(No payment will be made during the transitional period pending the outcomes of the independent review in July 2012)
Deputy City Mayor
(this represents the current Deputy Leader special responsibility allowance)
Strategic Assistant Mayors
(this represents the previous Lead Member Special Responsibility Allowance)
Assistant Mayors (Directorate portfolios, Cabinet Member)
(Unchanged at previous Lead Member special responsibility allowance)
Assistant Mayors (Crosscutting portfolios, Cabinet Advisor)
(this represents 75% of the above allowance for Assistant Mayors who are Cabinet Members )
Chairs of Scrutiny Committees and Audit and Accounts Committee
Chair of Planning & Transportation Regulatory Panel
Chair of Licensing & Safety Regulatory Panel
Leaders of the Opposition Groups (with at least 3 members) / 0
14,637
13,011
13,011
9,758
8,133
8,133
8,133
8,133

1.7 All other matters remain the same in accordance with Appendix 1 pending the outcomes of the review in July and September 2012. At this stage, these proposed transitional allowances represent a reduction of approximately £40K less than 2012/13 allowances over a full year.

  1. Recommendations

That the Council

  1. Approve the proposed temporary changes to the Members Allowance Scheme as detailed in the report to take account of the changes in the Council’s governance model. These changes will be temporary measures pending the proposed independent review
  1. Approve that the Chief Executive conduct a full review of the scheme for Members allowances using an independent Remuneration Panel which will conclude its finding for a further report to the Council in September 2012.

Appendix A Current Members Allowance Scheme

The allowances payable to Councillors in Salford during 2011/12 were previously set by an Independent Panel on Members’ Allowances which was appointed by the council to undertake a review of allowances in accordance with the Government’s guidance. The current scheme operates as follows;

1.1.1Basic allowance

All members of the council are entitled to a Basic Allowance, currently £10,080 per year. The rate is increased annually in line with the annual pay settlement for Local Government employees (APT & C staff).

If a Member’s term of office does not cover the whole of a year, the amount of allowance payable will be proportionate to the actual term served.

1.1.2 Special responsibility allowance

In addition to the Basic Allowance a Special Responsibility Allowance is paid to those members who have significant responsibilities. The positions for which this allowance is paid and the applicable rates are:

Position / Annual Allowance
£
Leader of the Council
Deputy Leader of the council
Lead Members
Executive Support Members
Chairs of Scrutiny Committees and Audit and Accounts Committee
Chair of Planning & Transportation Regulatory Panel
Chair of Licensing & Safety Regulatory Panel
Leaders of the Opposition Groups (with at least 3 members) / 28,185
14,637
13,011
6,174
8,133
8,133
8,133
8,133

If a Member does not hold the position for which special responsibility allowance is paid for the whole of a year, the amount of such allowance payable will be proportionate to the period for which the position was held.

Basic and special responsibility allowances are increased in April each year in accordance with the annual pay settlement for Local Government employees (APT & C staff). The use of this index will be reviewed by the Independent Remuneration Panel notbefore five years from 21st December, 2006.

1.1.3Membership of other bodies

Members of the city council who are also members of the Greater Manchester Passenger Transport Authority, Association of Greater Manchester Authorities (AGMA) and the Local Government Association (LGA) will be entitled to basic and special responsibility allowances as appropriate in addition to the city council allowances. The amount of any allowances will be notified directly by those bodies and will be paid by the council who will then reclaim the cost from the appropriate organisation.

Where a Councillor represents Salford City Council on the Greater Manchester Waste Disposal Authority a Special Responsibility Allowance of £1,764 per annum is payable.

Where travel and subsistence costs are incurred in connection with meetings of these bodies claims should be made on the normal claim form.

Claims for attendance at the Greater Manchester Police Authority and the Greater Manchester Fire and Civil Defence Authority should be made directly to those bodies and not via the city council.

1.1.4Co-optees’ allowances

Co-opted members of the:

  • Children’s Services Scrutiny Committee
  • Standards Committee

are entitled to claim £546 per annum if they chair one of these committees or £384 per annum if they are a member of the committee. If a co-opted member’s term of office does not cover the whole of a year, the amount of allowance payable will be proportionate to the actual term served.

Travel allowances

1.1Car allowances

Where Councillors or co-opted members use their own vehicle on approved council business, an allowance is payable based on the following rates:

Up to 999cc
1000cc to 1199cc
Over 1200cc / 48.4p per mile
42.0p per mile
39.5p per mile

Car parking charges incurred in connection with approved council business will be reimbursed. All members will be required to purchase a car parking permit to access car parking at any of the Council workplace car parks in accordance with the car parking scheme.

Reimbursement of Losses in Relation to Damage to Members’ Vehicles

The amounts for this allowance are as follows:-

Loss of no claims bonus up to a maximum of £300

Payment of excess up to a maximum of £150 on Members’ motor policies

2.1Public transport

If members travel by bus the cost of the journey will be reimbursed in full. In the case of train travel it is expected that members will travel standard class unless there are economic and exceptional reasons for travelling first class or due to pre-booking discounts provided that cost remain below the costs of standard class. Bus passes are available on request for Members who do not intend to claim car allowances.

3.1Cycle Allowance

Those Members who intend to travel by cycle are entitled to claim an allowance of 10 pence per mile. These journeys should be recorded on the Members’ allowance claim form.

4.1Taxis

Where it is necessary to use a taxi for approved council business the cost of the fare plus reasonable gratuity will be reimbursed.

5.1Subsistence

Subsistence allowances are not payable for duties undertaken within the city. Where Members incur costs in connection with official duties outside the city the reasonable allowances can be claimed.

Subsistence allowances are not payable where meals are provided by the meeting or conference organiser.

Overnight accommodation should be booked, in advance, through the Members’ Services Unit.

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5.1

5.1.1Carers’ allowance

Councillors who care for children aged 15 or under or other dependants are able to claim a carers’ allowance of £7 per hour while on approved council business. Members should take into account the times when childcare facilities are likely to be available when setting the times of meetings. Such payments are made on the submission of invoices from registered providers of care.

5.1.2Payment of allowances

Claims should be submitted to the Strategic Director of Customer and Support Services on a monthly basis but no later than two months after carrying out the approved duty.

Payment of basic, special responsibility, travel and subsistence allowances will be made on the 15th day of each month or the preceding working day where the 15th day falls at weekend or on a Bank Holiday.

Members are requested to have payments paid directly to their bank accounts as this is the cheapest and most efficient method of payment. Where essential, it is possible to make payment by personal cheque.

5.1.3Foregoing allowances

A Member may, by notice in writing given to theMonitoring Officer, elect to forgo his/her entitlement, or any part of his/her entitlement, to allowances.

5.1.4Taxation of Members’ allowances

Allowances are treated for income tax purposes as income received from employment and are chargeable to income tax. Tax will be deducted from the allowances paid to Members under the PAYE system. Tax is not deducted from travel and subsistence allowances or carers’ allowances provided they are reimbursements for costs incurred and are supported by appropriate receipts.

National insurance contributions

For national insurance purposes Members are treated as employees and are liable to pay national insurance contributions where the amount of allowances received exceeds the national insurance threshold amount.

5.1.5Sick pay

Members are entitled to statutory sick pay and should notify the Members Services when they are unable to undertake their duties due to sickness.

5.1.6Pensions

Members can now apply to join the Local Government Pension Scheme. This option is available to all Members under the age of 70. Pension contributions are payable at a rate of 6% of the Basic and Special Responsibility Allowance. Details of the scheme costs and benefits are available to Members along with the relevant application forms.

5.1.7Withdrawal of allowances

The Standards Committee can decide to withdraw allowances wholly or partially in the event of a Member being suspended in whole or in part.

5.1.8Publication of allowances

The council is required to publish annually in a local newspaper detail of the allowances paid to each council Member.

5.1.9Notification fee

Councillors must be registered individually with the Information Commissioner and must pay the annual registration fee which is currently £35. The cost of the notification fee will be borne by the council.

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