Southampton proposes 5.4% pay cut for all staff in bid to save jobs

Every member of staff at Southampton City Council could see their pay cut by 5.4% from 1 April 2011 as part of a proposed package of measures to reduce the authority’s budget by £62m over the next four years.

Southampton said the move was designed to protect services by avoiding significantly more redundancies. Councillors’ allowances will be cut by the same amount.

The proposed changes to staff terms and conditions include:

• a package of measures to reduce chief officer pay by on average 5.4%, which will include: reverse increment for all chief officers.(i.e a salary reduction of one spinal column point); introduction of additional five days unpaid leave entitlement for all chief officers (the additional days will be deducted from salary and equate to a 2.3% reduction in working time across the year); and a 1% additional pay cut across all pay bands for all chief officers
• reduction in paid working hours of two hours per week (pro rata for part time employees) for all employees below chief officer grade. “This will equate to an on average pay reduction of 5.4% in return for working 5.4% less hours e.g. from 37 hours to 35 or from 39 hours to 37”. The reduction is not applicable to chief officers as their employment contracts do not state any working hours
• no pay increments for all employees for two years (2011/12 and 2012/13)
• no cost of living pay award for two years
• removal of payment (other than any statutory entitlement) for uncertificated sickness after the first three days during any rolling year
• restructuring of essential and contractual car user entitlements
• reduction in mileage rates to the government approved rate of 40p per mile
• removal of all market supplements
• removal of the leased car scheme.

The changes are expected to save the council £8.6m in 2011/12 and £12m in 2012/13.

The package of measures will also see some non-core services either reduced or stopped. However, Southampton did announce that extra investment would be made in road and pavement repairs and in the care of vulnerable children.

Cllr Royston Smith, Leader of Southampton City Council, said: “Our savings proposals represent months of planning. We knew the spending review was coming, we knew it was going to be tough and we planned for it to be tough.

“In common with councils across the country, we simply can’t do everything we have done in the past. Some services will be reduced and some will go altogether. We will have to make difficult decisions and we will have to focus on services that are valued most by residents and businesses.”

Cllr Smith acknowledged that the council’s savings proposals would have a direct impact on council staff. He said: “Up to 250 posts will go in the first year. Redundancy is awful for those staff involved and I am sorry for this.

“In addition, every single member of staff, including the chief executive and senior managers, will be affected by changes to terms and conditions. It should be recognised that reduced working hours, stopping the payment of incremental salary increases and reducing mileage rates have all been suggested by council staff as part of our ongoing budget consultation.”

Southampton’s leader added that if the changes were not introduced, a further 400 jobs would be lost over the next two years.

The proposals were put to staff and unions last Thursday (11 November) at the start of a statutory 90 day consultation period. Southampton’s Executive is to finalise the proposals and formally recommend them to the full council at a meeting in February.

Southampton is also looking at reducing costs by working more closely with neighbouring councils.