Page last updated at 13:16 GMT, Monday, 6 April 2009 14:16 UK

End public pay excess, say Tories

Recycling bins in Southwark
Around 20 council heads are believed to earn more than the prime minister

A Tory government would end the "age of excess" in public sector pay, shadow chancellor George Osborne has said.

He told the BBC pay should reflect economic conditions and the Conservatives would change the "culture of Whitehall" to save money.

Meanwhile, a pressure group's report suggests more than 1,000 council bosses earn six-figure salaries.

The government said this justified its plans to make councils publish the pay packages of 2,500 top earners.

A report by the Taxpayers' Alliance suggests those earning £100,000 or more rose by 27% in a year - with at least 16 people being paid more than Prime Minister Gordon Brown.

Economic conditions

The group published its "town hall rich list", based on replies to Freedom of Information requests submitted to 469 local authorities.

The top package, according to the list, was for Wakefield Council's former chief executive John Foster.

His £205,000 salary was part of a £545,000 remuneration package for Mr Foster, who left the post in March 2008.

The second highest package went to former Shrewsbury and Atcham chief executive Robin Hooper - who received £335,848. He left the post in December 2007, having been paid a £87,616 salary, a redundancy package worth £168,000 and further compensation packages.

John Foster, Wakefield: £545,000*
Robin Hooper, Shrewsbury & Atcham: £335,848*
Peter Gilroy, Kent: £255,000
Derek Myers, Kensington & Chelsea: £225,000
Derrick Anderson, Lambeth: £218,870
Andrea Hill, Bedfordshire: £208, 767
Peter Rogers, Westminster: £205,000
Caroline Tapster, Hertfordshire: £202,503
Sir Howard Bernstein, Manchester: £199, 056
Dr Richard Shaw, Surrey: £199,000
Source: Taxpayers' Alliance survey *Salary and redundancy packages

Asked on BBC Radio 4's Today programme how he would restore the public finances if he were chancellor, Mr Osborne said: "I haven't ruled out further tax rises although I will work hard to avoid them because I think where the bulk of the strain needs to be borne is on spending restraint."

That would include ensuring pay settlements reflected the "prevailing conditions in the economy", he said.

He also said there was a need to "look at" the three-year public sector pay deals because "they may be very inflexible at a time when the economic conditions are changing very quickly".

It was "difficult to justify" very high salaries in the public sector, he said, and any quango boss being paid more than the prime minister would have to justify themselves to the Treasury, Mr Osborne said.

"It sends a very powerful signal throughout the public sector that the age of excess is over and we need an age of restraint and responsibility."

Local Government Association head John Ransford said the employees involved in the Taxpayers' Alliance report represented just 0.0005% of the local government workforce.

'Great managers'

He said it was right that the best candidates were found to run councils, which spend £100bn of taxpayers' money on services but that had to be balanced with the need for pay to be "demonstrably reasonable".

"Many councils have bigger budgets than FTSE 100 companies and to get the brightest people to deliver the best services for local people they need to pay a competitive wage," he said.

Local government minister John Healey said the figures justified his plans to make councils to publish the remuneration packages of 2,500 top earners.

He added: "Councils have big jobs to do that need the best people, but senior salaries are rising far faster than other areas.

"In a downturn the public rightly expects councils to tighten their belts with every penny possible focussed on frontline services."

His colleague Health Secretary Alan Johnson said some action had already been taken to restrict senior salaries.

He said the Tories should save money by scrapping their pledge to abolish inheritance tax on properties worth less than £1m - a policy Labour says benefits only the wealthy - rather than "cutting the pay of nurses, teachers and police".

But David Clark, director general of Solace, the body representing council chief executives, denied salaries were out of control.

"The public sector needs great managers because we are in a serious recession and the public will want good services without an increase in taxes," he said.

"Councils chase chief executives with a proven track record in delivering excellence. This competition drives the market in a very small numbers of cases."

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