£35.7m paid in ‘exit payments’ to KCC staff in last seven years.

Exit payments from Councils have long been controversial and many have been paid out to “public sector fat cats“, according to a House of Commons Briefing paper.

Public sector exit payments can be paid to an employee, or to a pension scheme in respect of that employee, when they leave their employment. Some of the exit payments come tax free.

When the former Chief Exec of Folkestone & Hythe District Council – Alistair Stewart left his post he received £184,000 exit payment, as did Peter Wignall who left with a £185,000 and was reemployed less than a year later.

They are naturally controversial and in the last seven financial years Kent County Council have paid out £35.7m in exit payments to one thousand one hundred and forty two members of staff, according to data released by the MHCLG.

We cannot say who got what, but we can say in the KCC Statement of Accounts 2019/20 all exit payments for that year amounted to £641,602, yet the data supplied by KCC to the Ministry does not agree with this.

In Nov 2020, the Govt introduced the Restriction of Public Sector Exit Payment Regulations 2020. The Regulations prevented relevant authorities from making exit payments in excess of the £95,000 cap.

Under the Regulations various payments counted towards the exit payment cap. These included redundancy payments, severance payments, settlement agreements and ‘pension strain’ payments (i.e. additional employer pension contribution to enable an individual to take early retirement on an unreduced pension). It was the total of all exit payments that could not exceed £95,000.

There were a number of payments that did not count towards the exit payment cap. These included payments for death in service, payments for accidents or injuries, certain payments relating to firemen and judicial pension schemes and payments pursuant to a court order.

On 12 February 2021, the Treasury announced that it had reviewed the Regulations and concluded that there had been “unintended consequences”. As a result, the Regulations were revoked on 19 March 2021.

Some but not all former KCC employees would have received an ex-gratia payment in their exit packages. Ex gratia translates to ‘by favour’ and literally means a voluntary payment or a gift. In Settlement Agreements these payments indicate a sum that is paid without admission of liability by the employer and the use of the term ‘ex-gratia’ specifies to each party that the employer does not consider that they are under an duty to provide this amount. Ex gratia payments up to £30,000 are tax free.

The Treasury are currently looking again at ‘exit payments’. They say they’ll introduce fresh legislation to cap public sector employee’s walking away with large sums of taxpayers cash. How soon is soon we have no idea. Meanwhile, public sector workers – especially at the top of the tree – will continue to walk away with vast exit payments which cannot be described as Value for Money.

The Shepway Vox Team

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2 Comments on £35.7m paid in ‘exit payments’ to KCC staff in last seven years.

  1. “Meanwhile, public sector workers – especially at the top of the tree – will continue to walk away with vast exit payments”

    You left two words out…. “especially at the top of the MAGIC MONEY tree”

  2. I think this is why people have no faith in Politics /Political process – This is madness!giving away Public funds to people who have already been paid inflated wages in Local Govt Jobs .

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