Jacob Williams
Thursday 30th January, 2014

Tax-dodge scheme IS unlawful

Tax-dodge scheme IS unlawful

The long-awaited public interest report into Pembrokeshire County Council’s highly controversial ‘Pensions Arrangements’ has today been published by the Wales Audit Office.

In his very critical report, the WAO’s assistant auditor general for Wales, Anthony Barrett, maintains his view that the decision taken by the council’s Senior Staff Committee to allow senior council officers to avoid pension tax is ‘ultra vires,’ and that there have been numerous ‘failings in governance arrangements’ along the way.

The document does away with any prospect of doubt – in the Wales Audit Office’s view – that the ‘Pensions Arrangement’ adopted in 2011 is an ‘unlawful’ tax-dodge scheme, and says that several actions taken in relation to the scheme are also ‘contrary to law.’

So long has this report been awaited, that it will be useful to remind readers what it is commenting upon. The now-infamous tax-dodge scheme was introduced and approved during a behind-closed-doors meeting of the council’s Senior Staff Committee, convened by the chief executive in his office, on 28th September 2011. The offending resolution was made by the small committee of six senior councillors — Jamie Adams, John Davies, John Allen-Mirehouse, Stan Hudson, Sue Perkins, and the only ex-councillor, David Wildman — off the back of a scant report titled ‘Pensions Arrangements’ which failed to fill a whole sheet of A4 paper. It was co-authored by the Director of Finance and the Head of Human Resources, both potential beneficiaries of the scheme, and was discussed by the committee in the presence of the chief executive, who was the only council officer to avail himself of the scheme during the 2012/13 financial year, receiving £22,269.

The report before the committee – and the unlawful decision – were directly brought forward as a way to allow what the auditor describes as ‘certain senior officers’ of the authority to avoid tax, by circumventing the Finance Act 2011, which was brought in by the government to restrict the amount of pensions tax relief for individuals, by reducing both their annual and lifetime allowance.

Prior to the committee’s decision, senior officers were free to opt out of their Local Government Pension Scheme, but if they did, they would have lost out on their employer’s contributions – the money paid by the council into their LGPS pension pot. The committee’s decision to approve the tax-dodge scheme – which the auditor says is of an ‘unusual nature’ – allows senior officers who decide to drop out of their pension scheme to keep on receiving the benefit of the council’s contributions, by effectively allowing them to be received as a pay rise – which the auditor refers to as a ‘pay supplement’ – in the form of cash which they are free to do what they like with.

Mr. Barrett’s report holds that the committee’s decision ‘is ultra vires and cannot be lawfully implemented,’ and that the scheme, the way it was introduced and the actions taken by the council were unlawful for a whole host of reasons. A closer look at some of the key points follows, but here it is, in a nutshell:

What the auditor says…

The scheme is unlawful because the council used its powers to give senior officers a pay rise, for the purpose of ‘avoidance or mitigation’ of tax levies brought in by the government.

The council failed to consider its public sector equality duties, and the decision constituted ‘indirect discrimination,’ potentially ‘discriminating against women and/or younger employees.’

Senior council officers with a ‘disqualifying personal and pecuniary interest in the decision, participated in the decision-making process’ and authored the committee report recommending the scheme’s adoption.

Even if it wasn’t unlawful, the committee’s decision – which was taken on the basis that no additional cost would accrue to the authority – is not being adhered to, because it does accrue additional cost to the authority.

‘The council,’ which has obtained its own legal advice, does not accept that ‘the pay supplement is intrinsically unlawful,’ and ‘declined to provide that advice’ to the investigating auditor, because it is ‘not suitable for disclosure and privilege is not waived.’

‘The council’ disputes the auditor’s authority to comment on the legality of many key aspects, and questions the auditor’s powers to investigate and make such findings.

…so, what next?

The auditor says the council ‘should rescind the decision and withdraw the current option for senior staff, stopping any future payments.’

If the council intends to introduce a pay rise for senior staff, then it must be lawful, reasonable, and in-line with the authority’s ‘responsibilities under the Public Sector Equality Duty;’ and ‘procedural weaknesses’ identified by the auditor must be addressed.

Within one month of today, the Council is required by law to consider the auditor’s public interest report at a full meeting of the council.

During the meeting, the council must decide:

A – whether the report requires the council to take any action;

B – whether the recommendations in the report are to be accepted; and

C – what action to take in response to the report and recommendations.

The principle

“Avoidance/ mitigation of the effect of legislation is not a proper purpose for which a local authority may act. For that fundamental reason, the decision taken by the Council’s Senior Staff Committee on 28 September 2011 is ultra vires and cannot lawfully be implemented.”Essentially, the auditor finds that the very principle of the scheme is unlawful. It was introduced to give senior staff the option to avoid tax, but was actually implemented by the council’s misue of its powers to set staff pay levels, rendering the decision ‘ultra vires.’

Mr. Barrett says that a council would not be exercising its powers properly by increasing staff remuneration for “an extraneous or legally irrelevant purpose such as the avoidance or mitigation of the effect of restrictions in pensions legislation.”

It is common ground between the auditor and the council that the scheme was introduced to allow the highest paid officers the option to avoid ‘substantial tax liabilities’ – it could hardly be denied, as it’s one of the few stipulations within the short report to the committee.

Lack of information

The basis of the decision was set out in a report consisting of a few sentences on a single sheet of A4 paper, and nothing else. It claimed that the introduction of the tax-dodge scheme was essential to ‘aid recruitment and retention’ of senior staff, with the insinuation that officers would leave the authority or not be recruited into the authority, if they had no way of avoiding the new tax changes.

Mr. Barrett says that the report to councillors provided ‘no evidence’ to demonstrate that this was the case, ‘no information’ on how the new tax changes would impact on any staff members, ‘no information’ relating to the council’s equality duties, and, perhaps most glaringly, ‘no information’ on the legal implications of the scheme. As a member of the authority’s Corporate Governance Committee, I established at our September meeting that the reason for this was because no such advice was actually ever sought.

Officer involvement

“…the Director of Finance and Leisure and the Head of Human Resources whose report was before the committee have a disqualifying personal and pecuniary interest in the decision, as senior officers who were eligible to benefit from the proposed pay supplement.
In addition, the Chief Executive and Head of Human Resources were present at the meeting and did not make any declaration of interest.”
Today’s highly critical report also discusses – in a helpful level of detail – the implications arising from the involvement of senior officers who were direct potential beneficiaries of the scheme, in its introduction and adoption. The report holds that officer involvement alone would have rendered the decision ‘ultra vires.’

The level of detail provided by Mr. Barrett is helpful, because at September’s Corporate Governance meeting, opposition members scrutinised the involvement of senior officers in the decision, and, in particular, the fact that the chief executive – who was the only council employee during 2012/13 to take up the scheme – took part in the meeting by remaining present during the discussion of this item.

Members were told during September’s Corporate Governance meeting, quite unconvincingly, that there was no requirement for the chief executive to have declared an interest. A guidance note relating to section 117 of the Local Government Act was read out by the Head of Legal and Committee Services, implying that officers, on this occasion, didn’t have any interest to declare. It read:

“If an officer knows that a contract in which he has a pecuniary interest is before the authority, he must give notice of his interest to the authority. This does not apply to a contract with him in his own name, since the authority will then know of his interest.”

As I pointed out at the time, this tax-dodge scheme doesn’t relate to an individual’s contract, but a wholesale change of council policy relating to a bunch of its highest earners – which was introduced as a knee-jerk reaction to the imposition of higher tax levies. Nonetheless, it doesn’t appear to have convinced the auditor, either, who says:

“A person is disqualified from participation in a local authority decision-making process if there is a real possibility that he or she would be influenced by a pecuniary or personal interest in the outcome of the decision. Disqualification from participation applies to an officer providing written or oral advice to a decision-making committee or board.

Any pecuniary or personal interest has to be declared and an individual having such an interest is not entitled to participate in the decision-making process unless that interest is too remote or insignificant to matter. In general, the participation in a decisionmaking process of a single individual with a disqualifying interest will vitiate the decision arrived at…”

Before going on to make crystal clear that: “the decision-making process is wider than the decision itself and includes the presence of officers at a meeting. A person is disqualified from participation in a decision-making process if there is a real possibility that he or she would be influenced by a pecuniary or personal interest in the outcome of the decision. I am satisfied that officers took part in the decision-making process whilst having a disqualifying financial interest in the outcome of the decision.”

Not being followed

Even if the Senior Staff Committee’s decision to introduce the scheme was a lawful way of avoiding tax, the auditor finds that the decision has not been complied with. It was resolved on the proviso that the scheme “be made available to senior staff on the basis that no additional cost accrues to the Authority.” Up until now, this has been heralded by senior members at any given opportunity, in defence of the scheme.

Mr. Barrett finds that the scheme has incurred additional cost to the authority, chiefly because of the rate at which the opt-out tax-dodge contributions were paid: 14.7%. This figure is the rate at which payments are made by the council into an employee’s LGPS. It is made up of the employer’s contribution of 12%, with the additional 2.7% being a requirement to service future deficits and maintenance of the fund. The public interest report says “In my view, payment based on 14.7 per cent would allow the additional contribution [the 2.7%] to be paid to the Chief Executive, rather than paid into the pension fund. As a result, there would be some additional cost to the Council, as a future actuarial assessment would be based on fund assets that had not received the additional contributions.”

“In addition…” Mr. Barrett writes “…the Council also needs to consider the impact on national insurance contributions, as the national insurance contribution status of the Chief Executive has changed, following his opt out of the pension scheme.”

I can talk on this topic with some degree of involvement. I say involvement, rather than knowledge, because I’m no pensions or tax expert – and it seems I’m not the only one in County Hall. At the December meeting of council (item 37 – 3 hours, 5 minutes and 30 seconds in) I tabled a question to the council leader, Cllr. Jamie Adams, about this exact point. It was covered by the Western Mail. His answer, embellished with the sort of information only an officer could dream of penning, was that 14.7% was the correct rate to have been paid, and, in answer to my follow-up question, he disagreed that the authority was worse off and acting outside the resolution. It would be interesting to know if Mr. Barrett watched this webcast, but I can say with some level of confidence that Cllr. Adams would have been aware that this was one of the issues he was probing.

‘Indirect discrimination’

“In my view the quality of the process adopted by the Council was poor.”Even equality and discrimination issues arise within the auditor’s thorough report. There is a general duty on the council to have due regard to the following three aims: ‘the need to eliminate discrimination, the need to advance equality of opportunity and the need to foster good relations.’ Mr. Barrett says that the report to members of the Senior Staff Committee “does not address whether there were any equalities issues to be considered,” and that it appears no assessment was made of ‘the likely impact of the proposal’ on these three aims, and therefore there was a failure ‘to have due regard to the public sector equality duty.’

The decision was also ‘contrary to law’ because it constitutes ‘indirect discrimination.’ Both ‘younger employees and women employees are put at a disadvantage’ by the introduction of the scheme, as they are treated ‘less favourably than older employees and male employees’ because they are less likely to be eligible to benefit from ‘the approved pay supplement.’

What does the council say?

It’s too early to say how this report will be met by senior elected members or officers, however, there is a strong thread throughout the whole report which gives us a clue to the opposition Mr. Barrett faced in his task. It is a fascinating thread which suggests quite strongly that the council has sought to undermine Mr. Barrett’s authority, power, and ability, to do his task.

Even by Pembrokeshire County Council’s standards, the arrogance is astounding.

Mr. Barrett says that he shared his legal advice with the council, which had also received its own legal advice ‘in response,’ but he says the council “declined to provide that advice to me, stating that the ‘written advice is not suitable for disclosure and privilege is not waived’,” instead, the council gave him ‘a paper that sets out its position on each of the issues raised,’ in which the council does not accept that ‘the pay supplement is intrinsically unlawful.’

In something of a surprise to a mere backbench councillor like me, Mr. Barrett reveals that in September 2013, the council decided to ‘revisit its decision.’ This was news to me, and it’s made even more surprising because on the very last day of September, at the Corporate Governance committee showdown, officers and senior members revealed nothing of the sort, and made out just how wrong the auditor was in his concerns. It doesn’t appear to have come to anything, because Mr. Barrett remarks that he is “not aware that any action has yet been taken to address this.”

The report also reveals that the written submissions received by the Wales Audit Office from the members of the committee who made the decision in September 2011, ‘sought to justify’ the decision they had taken, whilst the response ‘the Council’ sent back, “puts forward the view, in a number of places, that these are not matters for the auditor.” Incredible!

On the topic of equality, we’re told: “The Council response refers to the discipline of the public sector equality duty lying in the quality, not the outcome, of the decisionmaking process. It argues that it is not the traditional role of an auditor to enforce discrimination law.”

On discrimination, we’re told: “The Council position paper points out that discrimination is a statutory tort, enforceable by an individual who may (normally within three months of the act complained of) bring a complaint that they have been discriminated against. It is the Council’s view that it is not for the auditor to assert individual claims not made by any individual.”

What next?

The auditor’s investigation was sparked during his inspection of the 2012/13 accounts after he became aware of a sudden stop in the council’s payments to the chief executive’s pension scheme. He says the scheme and the payments made by the council pursuant to it (amounting to over £50,000 by the end of the 2013/14 financial year, during which a second, unspecified employee took up the arrangement) are unlawful, and the council ‘should rescind the decision and withdraw the current option for senior staff, stopping any future payments.’

The council’s 2012/13 financial statements – approved using the ruling group’s bloc-vote in September – should also be re-approved by the authority’s Corporate Governance committee, and the unlawful payment to the chief executive should be fully disclosed within it. Interestingly, councillors were informed yesterday afternoon that the regular meeting of the Corporate Governance committee scheduled for the 10th February has been cancelled ‘as there is no business to be transacted.’

A full meeting of the council is legally required within one month, at which members will decide: whether the report requires the council to take any action, whether the recommendations in the report are to be accepted, and what action to take in response to the report and recommendations.

The same auditor has today also published two reports into separate matters at a neighbouring authority.

An apparently identical tax-dodge scheme introduced at Carmarthenshire County Council in 2011 has been the subject of a similar public interest report, as has a 2012 decision taken to grant the authority’s chief executive legal indemnity in pursuing a successful libel counter-claim against Carmarthenshire blogger, Jacqui Thompson.


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52 Comments...

  • Tony Wilcox

    Wagon circling meetings being held today. How dare this dastardly auditor chappy question our divine Leader. We must defend him at all cost. (To council tax payers, that is.)

  • Tim

    PCC making the headlines again for the wrong reasons. Isn’t it time Bryn goes and a vote of no confidence for the leader as Pembrokeshire deserves better.

  • John Hudson

    When the full Council meets to consider the Auditor’s Report, what confidence can councillors, and we, place on any advice or comments made by the Council’s appointed Chief Executive, Head of Legal Services and its Monitoring Officer? All of these officers have a statutory duty to consider the legal aspects of proposals put before Council/committees.

    In addition to this the Council’s Finance Officer has a wide duty to protect rate payers’ interests.

    The Council’s political elite cannot escape accountability in this matter. What was the advice given to the Senior Staff Committee by the Council’s former leader, as referred to by the current leader? Oh sorry, there is no public minute of this.

    What a complete exhibition of a corporate governance shambles, just when councillors are trying to sell us PCC as a model of local governance and democracy fit for the future.

  • Goldingsboy

    Does anyone know whether any of the “six senior councillors”, given that some or all were likely to be members of the Local Government Pension Scheme, were also potential beneficiaries of this illegal decision?

  • John Hudson

    Incidentally, as I thought that our AM and MP would have some concern about PCC’s attempt to circumvent their Government’s pension policy I did write to both of them, shortly after the Committee decision.

    Our AM noted that “it would not cost PCC any more”, and our MP thought it was “interesting”.

    It is reassuring to know that we are all in this together, but some of us lower orders more than others.

    Presumably the council will have to re-approve its 2013/14 accounts now.

  • Paul Absalom

    Oh dear, more of Pembrokeshire people’s taxes wasted benefiting over-paid so called civil servants. The weak leadership of the council has seen to that. I think it’s about time some of the more intelligent and highly regarded councillors took a good look at just who they are following.

  • Tasso

    Having seen the report on the Council newsletter’s website, I can’t wait to see what the Herald makes of this!

    Heads must roll! Adams and Bryn, at least.

  • Wayne

    Pompous, arrogant, charlatans. The six senior councillors including the chief executive should be dismissed, taken to task legally and made to repay the funds that that have been paid out unlawfully, but I doubt this will happen as the council will no doubt manage to squirm their way out of it as they usually do.

    I thought that they were in office to safeguard our interests!

  • Quill

    WOW!!!

    This is the worst scandal to rock PCC since…

    …last week!!!

  • Chas.

    Through the courage and tenacity of the few, the layers of corruption ARE being exposed.

    Despite this and the Old Grumpy website being in the public domain and ‘Private Eye’ naming P.C.C. a ‘Rotten Borough,’ the W.A.G. and all the Cardiff based media have been asleep on the job.

    Are they linked to the same “cabal” that is seeking damage limitation? Is this a case for investigation by the Fraud Squad?

  • Welshman 23

    We have said for some time things were not right at the Kremlin. It did not need an audit officer to identify this, what next in this shambolic outfit?

    – Adams claimed expenses dating back four 4 years.
    – Grant scheme payments in Pembroke Dock.
    – Now this.

    The list goes on…

    Our councillors have a duty of responsibility to their electorate to take proper action.

  • Concerned

    The management board have a lot to answer, but in my opinion it shows the power and influence of ‘certain senior officers’ and their cohorts that their proposals are incapable of being challenged by councillors. They should not be allowed to quietly retire.

  • Anoldman

    How much has the council tax payer paid in legal fees to employ a top notch legal expert for what appears to be duff advice?

  • Anoldman

    From the report:

    “I believe it is important that the public has a full and proper awareness of the events concerning the Council.”

    Will this happen?

  • Goldingsboy

    It might interest Jacob’s tribal followers that the tax dodging scandal involving senior council officials was raised by Plaid Cymru in the Westminster Parliament today (30/1/14).

    This outrage must, surely, be getting too big to be ignored by our regional broadcasters, which has been the case for far too long.

  • Ianto

    Having read Cllr Lewis’ comments in the WT, I wonder whether we have read the same report.

  • Welshman 23

    When will an emergency meeting be held to discuss this report and will it be online to watch the squirming? Please let us all know the date.

    Now is the time to call a vote of no confidence in the administration and please do not offer those concerned an exit route with early retirement and perks etc.

  • Mike Cook

    Heads should roll, including the secret six who voted in the tax dodge.

  • Any Welsh speaking readers may be interested to hear that Pawb a’i Farn (a low budget version of Question Time) will be coming from Crymych on 6 February. Panellists will include Pembrokeshire County Councillor John ‘Cwmbetws’ Davies and Carmarthenshire’s Calum Higgins (a councillor who would like to be an MP when he grows up).

    Calum will probably be hoping that nobody in the Pembrokeshire audience will be interested in goings-on over in Carmarthen.

    Let’s hope someone has some pertinent questions for John Cwmbetws and young Calum.

  • Lizzie-Tish

    I’m with Quill on this one. Latest in a long list of scandals which the Teflon Men and True Blue Sue are getting away with. I’m more concerned with the £20 bet which I’ve placed with my other half that BP-J won’t resign!

    Watched Paul Miller on the BBC News at lunchtime and wondered how Sue Perkins was feeling knowing that could have been her dissing the other side if she hadn’t defected. Jacob – bring on the simple sum!

  • Interesting, Cneifiwr. You’ll no doubt be aware that Cwmbetws was council leader and chairman of the senior staff committee at the time this scheme was introduced.

    Not only did his skills include chairing the meeting, but offering the committee details of his own experience in a similar matter at another body he was involved with, though we’re not told which.

    I hope there will be English subtitles. Me and my fellow South-of-the-Landskers won’t have a clue what’s going on, though, of course, body language is universal.

    In response to Welshman 23, nobody knows yet when the council meeting will be held to discuss this report.

  • Welshman 23

    Who is the other senior officer that opted into the scheme?

  • That hasn’t been revealed by the auditor, Welshman 23.

  • Morgi

    Authorities have the power of confiscation where there is financial gain from illegal activities. Wouldn’t that be a fitting tribute? I suppose that legal aid is appropriate – oh, sorry, I forgot that I was already picking up the tab for the council’s legal advice.

    Councillors Miller, Stoddart and Williams are getting closer to breaking the stranglehold of that least independent IPPG. Please keep it up for the benefit of Pembrokeshire.

  • Keanjo

    This is all a very clever ploy by the Cabinet. Everyone is so excited about the £20,000 paid to BPJ and the £4,000 back expenses to the Leader, the Administration’s dismal record on education, child protection, and social services, not to mention the £1.75 million of taxpayers’ money ‘invested’ in Bluestone are being forgotten – they hope.

  • Fox

    When the extraordinary meeting is held to discuss the report, will Bryn and the “other chief officer” have to declare an interest and leave?

  • John Hudson

    I have just revisited the Corporate Governance Committee draft minutes of 23 September, item 17, concerning the audit of financial statements 2013/14.

    Apparently the committee “received” the report, but the Auditor was unable to finalise the audit and provide an opinion. What does this decision mean?

    The Leader advised that the resolution of the pension problem could be set aside and did not prevent the Committee from “signing off the Accounts”.

    Further advice was forthcoming from the Head of Legal Services to the effect that the legal advice obtained in conjunction with Carmarthenshire could not be disclosed without the ok from that Council, and pointed out that the Members’ ‘need-to-know’ test would have to be applied before any disclosure could be considered.

    Why can’t our elected members see the legal advice that we have paid for? Shouldn’t the Committee’s decision be qualified as regards the outstanding Audit Certificate?

    This committee of course has a majority membership of IPPG members, all too ready to accept without question senior officers’ advice.

  • Goldingsboy

    Old Grumpy has a couple of very tasty morsels, on “that other web site”, which Jacob’s followers may find as fascinating as I have.

    Disappointingly though, he treats as a mere aside, the fact that when Cllrs. Adams and Pugh visited the Paul Sartori shop, (to “check-out” Mike’s “outrageous” allegations), they couldn’t get in to that excellent emporium.

    The establishment, to their consternation, was firmly shut and the staff had gone, reducing these civic dignitaries to the unedifying position of having to peer through the liberally grant-aided glazed frontage in their elusive quest for evidence.

    Now, you would think that a couple of “senior” councillors would pay some regard to the fact that shops routinely open and close or, at the very least, that there would be an individual at County Hall capable of supplying the hapless pair with the correct information.

    That way the travelling expenses of Cllr. Adams, for example, which looks to have been needlessly incurred, and if they are able to claim reimbursement for them, it will not impact upon the Council’s budget – sometime in the next two or three years!

  • Welshman 23

    Thanks Jacob for replying to my comment about who is the other person involved. Surely this is of interest and under the freedom of information it should be out in the open, you and Old Grumpy must be delighted that things you have raised as concerns are now coming home to roost. IPPG and their band of merry followers must be writing their resignation letters.

  • John Hudson

    Welshman, only one officer, you know who, took advantage of this self serving scheme in the 2012/13 financial year of audit. (I think that the second officer who took advantage of the scheme in 2013/14 has been identified somewhere, probably in Council minutes).

    It remains to be seen at the public inspection of accounts 2013/14 whether any expenditure appears in respect of this pension arrangement.

    Hopefully nothing will appear as it will have either been paid back, and out again as an identifiable legitimate employer’s S&P contribution.

  • Hi John, the second officer has not been identified. Requests to establish this have been refused.

  • John Rhys Davies

    John Davies (Cwmbetws) is a member of the S4C authority. Will this influence the topics chosen for discussion in next week’s Pawb a’i Farn?

  • Jonathan Nutting

    Secrecy… for your eyes only… underhanded dealing… star chambers… cabals… buying votes with SRAs… lying in full council… dishonesty by stupidity… flouting rules… DISASTER…

    Must be a third world dictatorship? Ah no, just another day in the politics of Pembrokeshire. Thank god the Cleddau Bridge is such a good safety barrier. With a bit of luck South Pembs. will be back soon.

    Sorry the rest of you, but PCC is not fit for purpose. Too many County Councillors still supporting a leadership so past its sell by date to be embarrassing. Not enough backbone to say enough is enough. What will be the next banana skin? Cardiff Bay must be jumping for joy.

  • Welshman 23

    On what grounds has the request been refused, these are public servants paid by us. That is the trouble with this authority, treat us all like mushrooms and feed us nasty stuff. Enough is enough.

  • Sealight

    So, we are told that the CEO received £22,269 through this scheme in FY 12/13. Then we are told that this sum represented a 14.7% uplift on basic salary. Ergo, in FY 12/13 the CEO received £151,490; including the uplift.

    How much does the Prime Minister get for running the country? What extra benefits do we get for paying this princely sum?

  • While Sealight’s arithmetic seems impeccable, there must be more to this than meets the eye because, according to the accounts presented to the corporate governance committee on 30 September last year, Mr Parry-Jones’ salary in 2011/12 was £208,170 + employer’s pension contribution of £30,600.

    In 2012/13 he was paid £194,661 with pension contribution of zero.

    It is not easy to get a handle on this because some of his earnings are down to his duties as returning officer, so they vary depending on whether or not there has been an election or referendum in the year in question.

  • Quill

    The identity of the second recipient of unlawful cash is probably being protected by the council, just like the identities of the councillors who David Edwards has been trying to find out are members of the LGPS.

    Signing up to the pension scheme is not illegal, so I can understand why it might be private information about which councillors have joined, but if money has been paid illegally by the council to ANYBODY, then I think that’s a pretty damn good enough reason to let councillors AND the public know EXACTLY WHO received it.

    Obviously these illegal payments will have to be paid back, I take that for granted as ‘it goes without saying’ …but how else are councillors going to demand the money be repaid if they don’t know who has received it?

  • Jon Coles

    Mike Stoddart’s comment raises an interesting question: I believe that the LGPS is a final salary pension scheme, in that the amount of pension is based on the salary of the pension recipient at the end of their membership of the scheme.

    That being the case, it would appear that it would have been in the CEO’s best interest to exit the scheme at the point his earnings were at their highest ever, so as to ensure the highest possible annual pension upon retirement.

  • Andrew Lye

    I cannot see if anyone has reported the matter to the Police to investigate. Has anyone?

    I suppose if someone did turn up at a local police station, the Police would be obliged to investigate? Just asking…

  • Goldingsboy

    Andrew, have you? Just asking…

  • John Hudson

    Andrew raises an interesting point. What would the grounds be for reporting this matter to the police?

    If the unlawful gains were to be repaid, then we ratepayers have not lost anything. However there is, I think, a wider all embracing consideration of “maladministration”.

    The Auditor has already invoked “Wednesbury” regarding decision-making without taking into account/ignoring relevant considerations.

    Does anyone know about maladministration and how this gets to the Courts?

  • John Hudson

    At yesterday’s Council Leaders’ meeting of numerous authorities called to discuss mergers, was BPJ our unelected CEO there representing Pembrokeshire on his own?

    The BBC’s footage of delegates coming down the stairs looked as though he was there on his own, without elected Leader Adams, or either or both of his two deputy Leaders.

    If this is so, it says it all!

  • Welshman 23

    I question the accounts for PCC for the past years, these people are capable of doing anything. What was the cost for getting the advice on this pension sham? Cutting services and reducing salaries of the hardest workers is their way of saving money so they can spend the savings on feathering the nest of the fat cats and incompetent buffoons at the top.

  • Morgi

    The burden of proof in a legal matter is high. The grey area between right and wrong is wide and exploited to its utmost by successful and usually expensive lawyers.

    I believe that BPJ has conducted himself poorly in a matter which put his own interests above our interests, who are his employers and wage payers, and it is my belief that he should be fired or resign.

    Unfortunately, those who should do the sacking are elected and paid for by us and are possibly complicit in wrongdoing and/or haven’t got the strength of character to make a stand.

    In the event of litigation should he be sacked, BPJ should be able to afford his own legal costs.

  • Jon Preston

    Excellent report on the situation Jacob. This is nothing short of scandalous. The IPPG will undoubtedly close ranks on this one, however their wriggle room is a fast diminishing luxury at this moment in time.

    I would advise the Pembrokeshire electorate to closely watch their elected members during this situation and ask themselves if it’s their interests that are being protected or those of the IPPG.

  • Richie S.

    Everything that PCC/IPPG is involved with seems to be questionable, both legally and morally.

    Hopefully this is the beginning of the end – a new broom and thorough spring cleaning is badly needed!

    One would like to think that the majority of PCC, both IPPG and others, are decent people who want to do the best for the people of Pembrokeshire.

    Well done to OG and Jacob, plus others, who keep us minions informed of the dodgy dealings that our ‘lords and masters’ seem to think they can get away with.

  • Roy McGurn

    The whole methodology in how this council is run is corrupt. Officers are in control, to some extent the ruling group are merely opportunistic passengers. Accounts are massaged on a wide scale, whether it is officers’ pension schemes, diverting funds or other practices in social services.

    Removal of the CEO will result in a scramble to cover up such practice, unless of course a “suitable” replacement can be found. The only option is administration, seeing as the Ministerial Board failed to restore sound and responsible governance.

    The rate payers of Pembs have benefited enormously from this practice, restoring responsibility will lead to inevitable large (5%) rate increases.

    Beware the ruling group will fight it out to the last, as their survival in the current form is at stake.

  • Well spotted John Hudson – I can confirm that alongside the chief executive coming down the stairs was deputy leader, Cllr. Rob Lewis. I will be posting either today or tomorrow with an update.

  • Malcolm Calver

    Jacob, whilst accepting it is worthwhile knowing which sidekick attends such meetings with Mr Parry-Jones, surely it is more important that all county councillors are given a briefing regarding the meeting, with the pros and cons regarding the reorganisation of local government explained to them.

    It was reported in the press that there was a general feeling amongst those attending against any reorganisation, I suppose turkeys would not have voted for Christmas if they had been given a vote.

    I presume that Mr Parry-Jones and Cllr Lewis had consulted county councillors (the council) on this issue, or did they just assume they know best?

  • Hi Malcolm – the new post is now up.

  • John Hudson

    The future of Pembrokeshire County Council is clearly not important enough to warrant an Extraordinary Meeting of the Council, so that the will of this Council can be established. (That would be an interesting debate, defending the indefensible.)

    Instead, we have the CEO and a deputy leader going to Cardiff, who I suggest might have vested pecuniary interests in keeping the status quo.

    I understand that the Independent Remuneration Panel now has a legal remit to consider and advise on CEO pay. Thank goodness this corrupt outfit will not be able to concoct a case for reinstating the PCC senior officers’ pension arrangements, without an external independent assessment. Mind you it could always be argued that pension arrangements are outside this remit.

    Will the IPPG puppets continue to support their failed Leadership without question?

  • Old Grumpy’s been in touch and says the reason Sealight’s sums don’t accord with reality is something to do with National Insurance. The unlawful ‘pay supplements’ are net of NI, so including the gross figure in the calculation would arrive at somewhere close to the actual salary (circa £170,000 per annum.)

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