North Herts council officers took weeks to tell leader allowance vote was queried

The North Herts District Council offices in Letchworth. Picture: DANNY LOO

The North Herts District Council offices in Letchworth. Picture: DANNY LOO - Credit: Picture: DANNY LOO

North Herts District Council has told this paper its officers took weeks to inform the leader that questions had been raised over an unlawful allowance rise vote.

The Independent Remuneration Panel’s former chairman wrote to the district council in early February to query the two-per-cent rise approved by members in January – but council leader Lynda Needham was only told on March 8 there may be a problem.

The council then wrote on March 14 to the three-member panel – which legally had to be consulted before the vote – asking for the rise to be considered retrospectively.

The panel refused in writing on March 27, citing the legal issue and saying a retrospective review was outside its remit in any case.

Mrs Needham last week told this paper she found out about this on the same day NHDC chief executive David Scholes informed councillors, March 29 – the last working day before the rise was set to come into effect.

Mrs Needham told this paper an “administrative glitch” had led officers to believe it was this time not necessary to consult the remuneration panel – but panel chairman Ed Franklin said this claim was “disingenous at best”.

“At the time of the vote, every councillor will have been fully aware that the independent panel had not been consulted,” he said.

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Mr Franklin, who has chaired the panel since 2014, said his predecessor had written to the district council on February 8 and chased up on March 8 after receiving no response. Mr Franklin said he had contacted NHDC officer David Miley – who has now retired – on January 25, before writing again on March 2.

All this resulted in the district council asking the panel on March 14 to review the vote from January, Mr Franklin said.

Asked by this newspaper why it had taken so long for the query to be passed on to the leader and acted upon, a district council spokeswoman said officers had been seeking legal advice from February 20 to March 13.

Mr Miley and Mr Scholes were the officers listed on the January report. Mrs Needham said opposition councillors criticising her or calling for her to resign over the error were just “playing opposition politics”.

A motion is set to go before full council tonight, moved by Mrs Needham and seconded by Councillor Julian Cunningham, proposing to keep the 2017/18 allowance scheme until 2019/20 – with the money saved to go to NHDC’s five area committees.

The Independent Remuneration Panel of Ed Franklin, Michael Goddard and Hilary Oughton asked NHDC to make its letter of March 27 public, but it did not. We received it on April 5. Four days later, after we asked NHDC why the letter was not public, district council corporate legal manager Jeannette Thompson wrote to the panel to say the council needed to first clarify “some apparent misunderstandings in your letter regarding the legal requirements on indexation and the council’s decision in January”.

We publish the panel’s letter of March 27 and Ms Thompson’s reply of April 9 in full below.

March 27, 2018 – Panel’s letter to Ms Thompson

Dear Jeanette,

On 14 March we received a request to review the Council’s decision on indexation (of 18 January), due to take effect on 1 April 2018.

We had expected that we would be called to meet in the autumn of last year as we had in 2016 (and in the case of two of our number, since 2013). The courtesy of informing us that it was not deemed necessary on this occasion was not extended to us.

In the absence of any communiqué from the Council, we learned – via the press – that an increase in Members’ Allowances for the coming year had been voted through. Furthermore, a decision for subsequent raises for each of the next four financial years was made and approved, again without any consultation of an independent panel.

This is of considerable concern and we are of the understanding that this vote did not meet the legal requirements for remuneration for councillors as set out in Regulation 10(4) of The Local Authorities (Members’ Allowances) (England) Regulations 2003.

We are being asked to effectively ‘ratify’ a decision already voted on by councillors, rather than put forward our considered recommendations ahead of a vote. In the past, recommendations have been put forward as the cumulation of a number of hours of discussion over several weeks, facilitated by the Head of Democratic Services. The process involved meeting and talking with the Leader of the Council and Leader of the Opposition, Councillors, Chief Executive and reviewing the remuneration figures for neighbouring councils and those in the same audit family as NHDC. Further, on each occasion, we have given consideration to the local and national economic situation, and the work involved for councillors, as well as those fulfilling roles meriting a special allowance.

As such we feel that the request from the Council made less than a fortnight ago lies outside of the remit of the Independent Remuneration Panel. Even if deemed permissible, we do not feel it is appropriate - in such a short timeframe we cannot give full consideration of to the facts in order to make an independent recommendation on remuneration.

Given the circumstances, it is our opinion that an Independent Remuneration Panel should meet, in line with The Local Authorities (Members’ Allowances) (England) Regulations 2003, and that minuted meetings are held with an officer of the Council in attendance. As part of these panel meetings, the issue of indexation could be researched and discussed properly, as it has been in previous panel meetings in the period 2013 to 2016.

In the light of the circumstances, we would request that this letter is entered into the public record.

Yours Sincerely

Edward Franklin, Michael Goddard, Hilary Oughton

April 9, 2018 – Ms Thompson’s response

Dear Mr Franklin, Ms Oughton and Mr Goddard,

I write further to the email of 14 March sent by Mr Miley and your letter to me of 27 March 2018, my acknowledgement of the same date and email exchange of today’s date.

In your letter of 27th you asked that the letter be entered into the public record. However, I would explain that before the Council could do so, Members needed to be notified before Easter that the percentage increase would not be paid, and I also needed to discuss/ raise some apparent misunderstandings in your letter regarding the legal requirements on indexation and the Council’s decision in January, before doing so.

There were two issues of note within the letter. Firstly I believe that the previous custom and practice at NHDC was for the Independent Remuneration Panel (IRP) to be called together to review Members allowances each year and the last time that was undertaken was around 2016-17. However, from my experience elsewhere it is quite normal for the IRP to review Members allowances every 3 to 4 years and such a review would include a recommendation on indexation. If such a recommendation had been included in 2016/17, then, as per Regulation 10(4) of The Local Authorities (Members’ Allowances) (England) Regulations 2003, any indexed increase within the following 4 years would not be considered an amendment to Members Allowances (and therefore no further consultation with the IRP would have been required). It is now obvious that a recommendation on indexation was not made in 2016/17 and your reasons for not wishing to make a recommendation in March were noted; however, indexation per se would not normally be seen as the basis for the more detailed IRP process that you mentioned in your letter.

Secondly you also stated in the letter that: “a decision for subsequent raises for each of the next four financial years was made and approved, again without any consultation of an independent panel”. I am sorry but I do not understand that statement. Full Council did not resolve at the meeting in January to approve increases for each of the subsequent 4 years. Members resolved to approve a Members Allowances Scheme that included a 2% increase for the financial year 2018/19. That is the decision that has not been implemented.

Otherwise, as I mentioned above, Members were informed of the situation following your letter of 27th, and made aware of the IRP’s reasoning for not making a recommendation and the percentage increase was not paid / will not be paid from 1 April. Following this a motion has been submitted for tomorrow’s Council meeting as per the attached:

(B) Members’ Allowances Scheme

To be moved by Councillor Lynda Needham and seconded by Councillor Julian Cunningham:

“That this Council recognises that the Allowance Scheme for 2018/19, approved by the Council on 18th January 2018, was improperly made.

The adopted scheme for 2017/18 shall therefore remain in place without amendment for the 2018/19 year.

The Council further requests that the Chief Executive does not convene the IRP until any scheduled review of the allowances for 2019/20.

Council requests that the sum of approx. £6,800 saved by retaining the 2017/18 allowance scheme be allocated to the 5 Area Committees pro-rata to their existing allocation.”

As to putting your letter into the public record, as indicated I was hoping to discuss this with you (as per my request this morning for contact details) to raise the issues above before doing so. However, things appeared to have moved on since that request, as I now gather that the letter has already been forwarded to the Comet. This has now been put in the public domain and therefore in response to their query today regarding the letter of 27th, a copy of this letter shall also be sent to the Comet for information.

Thank you for your time on this matter, and the Council shall be in contact in due course for any future review.

Yours sincerely

Jeanette Thompson

Acting Corporate Legal Manager & Monitoring Officer