Decision details

Following consultation with the Leader of the Council, the Finance Portfolio Holder and Senior Leadership Team, the Head of Paid Service proposes a temporary cost of living support payment to all contracted staff currently on pay bands 1 to 7, as detailed in the table in the report. This offers the immediate recognition of the seriousness of the situation, which in the current climate is important.

In addition to this proposal, on 5 October 2022, the Appointments and Conditions of Service Committee (ACSC) will consider proposals for measures of a permanent nature to provide further support to staff on the lowest pay bands of the Council.

It is recommended that the Leader of the Council:

1. Endorses the proposal by the Head of Paid Service to make a temporary cost of living payment of £250 to all contracted staff currently employed on Pay Bands 1 to 7;
2. Approves the establishment of a budget by virement for the temporary cost of living support payments of £95,000 to be funded by a contribution from the Efficiency and Innovation Reserve.

To contribute to the relief of hardship suffered by our workforce currently on the lower pay bandings of the council.

• The first is that no budget for a one-off cost of living payment is approved. This would mean that no additional spend is committed beyond that associated with the national pay award. Socially this may have an impact in terms of hardship for our employees;

• The second is that the payments are made as a full amount to all employees in bands 1-7 rather than on a pro-rata basis. The benefit of a pro rata arrangement is that it is intrinsically fairer and from an employee relations perspective the arrangement is less divisive in that employees who work very few hours each week would not receive the same payment as a full time employee. That said, by applying a pro-rata payment to someone who works for, say five hours per week, would result in a relatively small payment being made that could be seen to be inconsequential and demotivating. However on balance, a pro-rata basis is the favoured approach and this option was not therefore supported;

• The third option that has been considered is a request received from the GMB Union Midlands Region for “a non-consolidated Covid-19 recognition payment of £2,000” for all staff. The cost of this option is approximately £950,000 and, in the Chief Financial Officer’s view, is not an affordable option in the context of the Council’s current financial challenges, the level of general fund balance, and the increasing uncertainties in the medium term financial plan. The initial inflationary impacts associated with the cost of living crisis on the Council’s budgets were reported to the 4 August 2022 meeting of Cabinet as part of the Quarter 1 budget monitoring report. This included the impact of the current statutory pay offer for which there is currently an ongoing funding shortfall of around £530,000 and for which ongoing savings will need to be identified in the absence of Central Government funding. However, as detailed above, the Appointments and Conditions of Service Committee will also be considering further permanent financial measures to support staff on the lowest pay bands of the Council.