Report also flags up issues with reliance on agency workers and sickness absences
More than £50m has been spent on pay-offs for staff quitting local councils over a five-year period, a report reveals today.
The number of exit packages in 2019/20 was higher than in any of the previous three years.
Councils agreed a total of 166 packages that year at a cost of £10.2m, according to the Local Government Auditor.
Colette Kane’s report also flags up issues around some councils’ reliance on agency staff, and problems with sickness absence.
And it warns of long-term challenges for council services and finances caused by the Covid-19 pandemic.
The report, published today, examines the financial statements of our 11 councils for the 2019/20 financial year.
One of its main focuses is on severance pay.
Councils are required to disclose the number and cost of staff exit packages each year, including compulsory and voluntary redundancy costs, pension contributions and other departure costs.
In the five years to March 2020, councils paid a total of £51.6m in exit packages.
Ms Kane’s report notes: “My predecessor reported the significant cost and number of exit packages in 2018/19, and this trend has continued in 2019-20, when councils agreed 166 packages at a cost of £10.2m.”
In 2018/19, councils had agreed 152 exit packages at a cost of £10.7m.
In 2019/20, two councils accounted for almost half the exit packages — Causeway Coast and Glens had 34, costing £2.4m, while Lisburn and Castlereagh had 36 at a cost of £2.2m.
Today’s report also notes some councils’ reliance on agency staff to operate services such as leisure centres and civic amenity sites.
Spending on agency staff accounted for around 3% of councils’ operating expenditure in 2019/20.
Ms Kane notes the overall increase in spend on agency staff from 2018/19 was “modest” at £474,000, and agency costs decreased in just over half the councils.
But she added: “Whilst I recognise that there will always be a need for agency staff to cover temporary posts and absences, during my financial audits I noted with concern the continued reliance on agency staff in two councils during 2019/20.
“In Causeway Coast and Glens, agency staff costs accounted for one third of total salary costs. In Mid and East Antrim, agency staff costs accounted for over 20% of total salary costs.
“I have continued to recommend that progress needs to be made to recruit and permanently fill posts in the councils affected.”
Sickness absence levels remained consistently high, the report notes, with an average of over 14 days lost per employee.
Absence rates rose from 13.9 days per employee in 2018-19, to 14.2 days in 2019/20.
Mid and East Antrim Council recorded the lowest number of days lost at 10.6 days (14.05 days in 2018/19), while Armagh City, Banbridge and Craigavon Council recorded the highest rate at 18.3 days (up from 16.7 days).
In five councils, absence levels have reduced year-on-year, while they have increased in the other six.
However, Ms Kane adds: “I am aware that during the 2020-21 year, sickness absence levels improved considerably as staff worked from home.”
She said previous reports had referred to the significant financial pressures facing councils, and warns the Covid-19 pandemic has added an additional layer of financial pressure.
While the short-term financial impact on local councils has been offset by additional central government funding, “there will be long-term challenges for council services and finances”.
A spokesperson for the Northern Ireland Local Government Association (NILGA), the umbrella body for local councils, said that as with many other sectors, the recruitment and retention of staff is a concern.
“Attracting and retaining staff is crucial, which is why councils are developing internships, apprenticeships, graduate programmes, encouraging training, skills development and succession management,” they added.
“NILGA’s primary concern remains the sustainability of local government, in financial, workforce and elected member representation terms, so that our councils can deliver high-quality public services across the communities they serve.
“Decisions around exit packages are made corporately by each council, as part of wider skills and investment decisions and in strict accordance with policy.
“NILGA is working to ensure that local government is a career of choice, for existing and future staff, and does so in partnership with all councils, pay and performance groups and training bodies.”