Minutes of a special meeting held on 2nd September, 2014.


Present:  Councillor Howard Hamilton (Mayor); Councillors Richard Bertin, Janice Birch, Rhiannon Birch, Jonathan Bird, Bronwen Brooks, Philip Clarke, Geoff Cox, Claire Curtis, Rob Curtis, Pamela Drake, John Drysdale, Stuart Egan, Christopher Elmore, Christopher Franks, Keith Geary, Eric Hacker, Val Hartrey, Nic Hodges, Jeff James, Hunter Jarvie, Gwyn John, Fred Johnson, Dr. Ian Johnson, Maureen Kelly Owen, Peter King, Kevin Mahoney, Anne Moore, Neil Moore, Andrew Parker, Bob Penrose, Anthony Powell, Audrey Preston, Rhona Probert, Gwyn Roberts, John Thomas, Ray Thomas, Rhodri Traherne, Steffan Wiliam, Margaret Wilkinson, Clive Williams, Christopher Williams and Edward Williams.





These were received from Councillors Lis Burnett, Kate Edmunds, Keith Hatton and Mark Wilson.





No declarations of interest were received.





Council was requested to consider and approve arrangements for the ongoing designation for the Head of Paid Service (and related senior management arrangements) in light of the current Managing Director’s intention to retire from service.  Prior to presenting the report the Leader advised Members that the only officers that would be present at the meeting would be Kim Howell, External Lawyer, (Geldards Solicitors) and Karen Bowen, Democratic and Scrutiny Services Officer . This having been considered in view of any potential conflict of interests for senior officers in relation to the issues contained within the report concerning future senior management arrangements.  Members also agreed to the request to waive  Standing Orders to allow officers  to speak at the meeting if appropriate.


In referring to the report the Leader indicated that it had been shared and discussed with officers from the Wales Audit Office and the Hays Recruitment consultancy who had advised that they were content with the proposals, the underlying business case and the rationale.  Hays Recruitment had also agreed to assist the Council with any restructure issues  if the recommendations contained therein were approved. 


The Leader commenced by advising that senior management reduction arrangements had been approved by Council on 16th April 2012 with the important part of those arrangements being the appointment of Mrs. S. Davies to the combined role of Managing Director / Director of Resources from 1st August 2012.  The appointment to the role of Managing Director had been approved on an honorarium basis for a three year period up to 31st July 2015 and had included statutory designation as the Council’s Head of Paid Service.  The current postholder had recently indicated her wish to retire from the post on 24th November 2014 and ahead of the scheduled end of the honorarium period on 31st July 2015.  The purpose of the report was therefore to seek Council approval to bring forward the review as referred to in paragraph 5 of the report and to consider options for covering the statutory duties of the Head of Paid Service in the short and long term. 


The Leader also took the opportunity to state that he personally felt the arrangements that had been put in place had proved successful for the Council over the last two years and had helped to provide strong and stable leadership.  The arrangement of the combined role of Managing Director / Director of Resources had provided the opportunity to amalgamate two roles which had contributed significantly to the required financial saving for 2012/13, however he advised of the demanding nature of the combined role and, in particular, the increasing strategic and financial challenges that the Council faced now and in the future.  He stated that the imminent loss of the current postholder comes at a difficult time for the Council in terms of increasing budget challenges, a range of challenging work programmes and the uncertainty of local government reorganisation.  He referred to the financial challenges set out in the Medium Term Financial Plan 2014/15 to 2017/18 and stated that over the next few months it would not only be imperative that the budget for 2015/16 was signed off but progress continued to be made in bridging the unprecedented funding gap over the next three years.  The Leader made reference to the Reshaping Services work programme which had been approved by Cabinet on 11th August 2014 as a basis for a wholesale transformation process for the Council over the next three years.  The success of which he said  would depend in the main on leadership and a continued momentum over the forthcoming months.


Further considerations he stated would also need to be given to the 'Williams Report', the Collaboration Agenda and the Welsh Government White Paper 'Reforming Local Government'. It was noted that expressions of interest of voluntary mergers were required by November 2014 with any fully developed submissions being needed by June 2015. 


The Leader then referred in detail to progressing the recruitment process and options for consideration as contained within the report by advising that it may be necessary to commission further work (and potentially external advise) on a number of the options in order to properly inform the decision of Council and to ensure that there were no conflicts of interest for any officers of the Council.  He referred to the option of progressing arrangements for the combined role of Managing Director / Director of Resources from September onwards which would have the benefit of providing certainty for the Council going forward and reducing the period where the Council was potentially without a Managing Director.  The report referred to the possibility of an appointment being secured by December 2014 if internally recruited or April 2015 if an external appointment was made.  Members were further informed that the post would need to be subject to external advertisement as per the requirements of the new Local Authorities (Standing Orders) (Wales) (Amendment) Regulations 2014.  This option would however, require the Council to formally confirm the establishment of the post on a substantive basis but without significant change to the terms and conditions of service.  In pursuing this approach Members would also need to consider formally reallocating the statutory role of Section 151 Officer, a responsibility which was a substantive part of the role of the Director of Resources but temporarily assigned to the Head of Finance on an honorarium basis up to 31st July 2015. 


A decision to progress an early recruitment campaign could also restrict the opportunity of taking a more considered view of the Council’s future senior management needs and, in view of the above, the Leader suggested Council may wish to consider alternative options in relation to the future senior management arrangements before committing to a specific way forward.  It could also not be assumed that a straightforward like for like appointment for the role of Management Director / Director of Resources may not necessarily be the right decision for the Council going forward and the combined requirement for a Managing Director with specific experience in managing corporate resources could potentially limit the field of applicants for the post.  For this reason the Leader suggested that it may be prudent to commission a review of potential senior management structural arrangements over the next few months in order that a considered decision could be taken.  The consideration of options would also need to include the allocation of responsibility for the Council’s Returning Officer which was currently undertaken by the Managing Director and which was an important aspect given the UK General Elections for May 2015. 


The Council could also delay any decision about the Council’s future senior management structure arrangements until there was greater clarity in relation to Local Government reorganisation, however the main concern here would be timing.  The Council needed to be able to plan in order to attend to the increasingly challenging service and financial pressures it faced and a delay in dealing with the senior management issue beyond the end of the financial year would not be considered helpful in progressing current priorities. 


The Leader further pointed out that regardless of any of the options referred to in the report, interim arrangements would need to be put in place to cover the role of Head of Paid Service from November 2014 onwards.  These arrangements would be important to ensure that there was continuity of leadership and momentum during the challenging period.  He referred to a number of ways that arrangements could be progressed, including the appointment of an external interim manager, the setting up of internal cover arrangements or the short term retention of the current postholder on a flexible retirement arrangement.  It was the Leaders view as expressed in the report to retain the services of the current postholder until 31st March 2015 on the basis of a flexible retirement arrangement.  This option he stated would have operational benefits for the Council whilst remaining broadly cost neutral.  It would provide continuity of leadership during a critical period and ensure the progression of the key priorities as referred to in paragraphs 10 to 16 of the report were met.


The Council had also previously supported a range of flexible retirement applications in the past with such applications having generally been approved as a means of retaining key staff who may otherwise have retired from service. It was a way of ensuring a managed transition and transfer of knowledge prior to a known retirement date.  In the case of the current Managing Director approval of such a proposal would require a reduction in contracted weekly hours of at least 40% with a commensurate reduction in pay and this would be the minimum reduction permissible under the Council’s Pensions Discretions Policy. 


The postholder would incur a salary reduction but would be entitled access to full pension benefits from the date of the flexible retirement. The LGPS regulations would mean that there would be no reduction of pension benefits for the postholder and as such there would be a small actuarial strain cost for the Council.  This would be broadly offset by salary savings during the period (see paragraph 80).


The report further informed Members that  applications for flexible retirement can only be considered where there was a financial or operational benefit for the Council and would normally need to be supported by the Head of Human Resources and Head of Finance prior to submission to the Early Retirement / Redundancy Committee.  In the case before Members it was obviously necessary to seek the approval of Council in the first instance. The arrangement would also provide important flexibility for the Council during what would be a challenging transitional period.  It would be an arrangement that would persist long enough to ensure hand-over arrangements with a new Head of Paid Service whilst also providing a month by month "extension" contingency if the Council was not in a position to make an appointment at that time. There would be no "running in" period for the current postholder or a loss of pace and momentum.  Such an arrangement was therefore considered to be more cost effective than, for example, an external interim manager engaged for a short period.


Members noted that the arrangement would enable the current postholder to offer advice and support in relation to the review of the senior management structure as proposed in paragraphs 26 to 36 of the report.  Unlike all other members of the Corporate Management Team the postholder would not, at that stage, be conflicted and would be able to offer independent and valuable support.


On the basis of the above, the Leader proposed that a flexible retirement arrangement for the postholder commenced on 25th November 2014, on the basis of 22 hours a week and up to 31st March 2015  the arrangement to be extended as necessary on a month by month basis from 1st April 2015 subject to the agreement of the postholder and in the circumstances as referred to in paragraph 60 of the report.  It was also proposed that such extensions be authorised under the delegated authority of the Head of Human Resources in consultation with the Leader of the Council.


Members were advised that flexible retirement was not, however, a long term and sustainable solution and could only be viewed as a transitional measure.  The postholder had indicated her wish to retire and it would be the responsibility of the Council to focus on arrangements to seek a replacement.  If supported, the arrangement would require some re-prioritisation of the postholder's workload and appropriate handover of activities.


It was for this reason the Leader advised that any arrangement it was suggested should not initially extend beyond 31st March 2015 unless on a "month by month" basis in the circumstances as set out in paragraph 60 of the report.


The resource implications were also as contained within paragraph 80 of the report with Members being advised that the later the start date of the flexible retirement period, the lower the actuarial strain costs to the Council, with the converse being true in relation to the savings in salary and on-costs.  For every month the flexible retirement arrangement was extended beyond 31st March 2015 there would be a financial saving of £5,862.  In direct contrast to this arrangement the cost of employing an external interim manager over a four month period was estimated to be approximately £65,000 based on a three day work pattern (less annual leave) and an estimated daily rate of £1,270.  The Leader also referred to the fact that the costs of independent advice in relation to senior management restructures and subsequent recruitment costs would also be required but could not be estimated at this stage. 


In response Councillor Chris Franks advised that he supported the report and wished to take the opportunity to record his appreciation of the current Managing Director for her years of service to the Council as well as offering his appreciation to the Leader and the Head of Human Resources in respect of the advice provided in relation to the matter.  He stated that there were many important issues that the Council had to face in the future for the people of the Vale, in particular Local Government reorganisation, the Medium Term Financial Plan and the Reshaping Services agenda. Councillor Franks requested that every opportunity be afforded to Members over the forthcoming months to engage with the Council leadership team in supporting the Council through the difficult times ahead. 


Councillor Jeff James also stated that, in his view, the proposals before Council   were reasonable and he took the opportunity to offer his congratulations to the current Managing Director on her capability of holding two important roles, Managing Director and the Director of Resources.


Councillor Gwyn John stated that he to fully supported the recommendations contained within the report and wished to record his gratitude to the Managing Director, although being fully aware of the challenges that the Council faced in the years ahead.


Councillor Bob Penrose echoed the sentiments that had been expressed by other Members with regard to the Managing Director’s services to the Council and  requested that the workload plan for the Managing Director if the flexible retirement was agreed, and that of the senior management team be referred to Full Council for consideration with regard to any cover arrangements. 


Councillor Clarke referred to the deadline for expressions of interest of November 2014 with regard to Voluntary mergers and asked whether the Council would consider proceeding along that path.  


In response to Member queries, the Leader, stated that the Managing Director’s  retirement had been a personal shock to himself he was grateful to her for her consideration of a flexible retirement approach.  He stated that Siân had had a tremendous effect on the Authority and he had also been grateful for her taking up the position of Managing Director and Director of Resources at the time.  He stated that he would certainly endeavour to keep all Members informed of future proposals in relation to the Williams Report, the Medium Term Financial Plan and  the Reshaping Services agenda.   With regard to the issue of expressions of interest, the Council had itself approved a motion not to merge with Cardiff and in relation to cover arrangements and the role of the Managing Director if the proposals contained within the report were approved a review would take place which would include arrangements for cover with a further report being presented to Full Council in December 2014.  


Following the summation by the Leader, it was subsequently


RESOLVED – T H A T the recommendations as contained within the report and outlined below, be approved:


(1)       T H A T the options in relation to the review of the statutory position of Head of Paid Service as set out in paragraphs 26 to 36 of the report be approved.


(2)       T H A T consideration of the outcomes from the review as above be referred for decision by Council on 17th December 2014.


(3)       T H A T arrangements for the flexible retirement of the current Managing Director / Director of Resources as an interim measure from the 24th November 2014 up to 31st March 2015 and in accordance with the proposals set out in paragraph 66 of the report, be approved.


(4)       T H A T delegated authority be given to the Head of Human Resources to progress matters relating to the contractual details pertaining to the flexible retirement arrangement (including referral to the Early Retirement / Redundancy Committee) in consultation with the Leader of the Council.


(5)       T H A T, in view of resolutions 1-4 above, delegated authority be given to the Managing Director to progress the necessary commissioning arrangements in relation to the review of the senior management structure in consultation with the Leader of the Council.


Reasons for decisions


(1-5)    To ensure compliance with the requirements of the Council's Constitution, the Local Government and Housing Act 1989, the Local Government (Wales) Measure 2011, the Local Authorities (Standing Orders) (Wales) (Amendment) Regulations 2014 and to ensure continuity of sustainable management arrangements over the next seven month period.