Nottinghamshire Council spends more than £1 million on redundancy packages

The Local Government Association said councils across the country have been forced to reduce their workforce sizes due to budget cuts despite dramatic increases in the volume and range of services provided

Department for Levelling Up, Housing and Communities figures show 45 people were laid off by Nottinghamshire Council in 2021-22 at an average of £27,987 per person.

It meant the council paid a total of £1,259,395 in exit packages last year – up from £1,089,102 in 2020-21.

But this was below the £3,014,499 paid out in 2019-20, before the coronavirus pandemic.

Nottinghamshire Council spent 85 per cent less on redundancy packages than in 2014-15 – when it let go of 422 employees at a total cost of £8.4 million – despite exit payments typically being higher.

Across England, the total amount spent on exit payments fell for the fifth-successive year, from £250 million in 2020-21 to £210m last year.

However, more staff were laid off than the year before, 9,744 compared with 9,454.

Andrew Western, LGA resources board chairman, said councils have made layoffs in order to manage their budgets and avoid further pressure on taxpayers.

He said: “Without funding from the Government to meet the pressure of an accelerating National Living Wage on top of soaring energy and other costs, more redundancies are likely, exacerbating the capacity crisis that is already acute in some areas and impacting the delivery of services to the public.

The data also shows the average exit payment across England fell from £27,000 to £22,000 in the year to March.

Ian Miller, Association of Local Authority Chief Executives and Senior Managers honorary secretary, said this shows there was no need for the exit-payment cap briefly introduced by the Government in 2020.

The cap, which meant public sector bodies' redundancy packages could not top £95,000, was brought in in November 2020, before being scrapped three months later.

There was also a discrepancy between senior and non-senior staff payments.

Across England, some 255 senior employees were laid off last year, accounting for a total payment of more than £20m at an average of £85,000 each.

The 9,490 other staff made redundant received an average of £20,000 each in comparison.

Local figures on payments to senior and other staff are not available to protect individuals' identities.

Mr Miller said exit payments are determined by staff’s actual salary and time of service, meaning senior staff tend to have higher packages.

Pension costs are a major element of exit payments for those aged 55 and above, he added, which is more likely to be relevant for senior staff.

Nottinghamshire Council has been approached for comment.