City of London Council Leaders Propose That They Be Paid (A Lot) More – While Their Social Housing Tenants Shiver In Poorly Insulted Homes & Face A Rent Hike

The City of London council is an institution so mired in misfeasance and scandal beneath its shiny PR facade that one post per week is not enough for this blog to keep pace. So only four days after we exposed the leader of the council, Chris Hayward, interfering in the City council’s planning process, misdirecting officers and striving to achieve total personal dominance of the council’s micro politics, we now report on a carefully devised a plan for him and a number of other committee chairs to be paid annual “special responsibility allowances”, in his case in an amount approaching six figures. All 125 elected members of the council have been invited to give their views on this plan in non-public, internal meetings on 26/2/24, 27/2/24. and 1/3/24. There is, of course, no proposal to consult the electorate.

We first set out the relevant facts, then expose the leaders’ plan to enrich themselves.

THE FACTS

The City of London council has 125 elected members (100 councillors and 25 alders), which is by far the highest of any local authority. Birmingham City Council comes a distant second with 101 members.

The City of London council, as at 15/2/24, had 6,211 resident voters and 13,514 business voters (the latter being unique to this council). That is the smallest electorate by far of any local authority (except the Scilly Isles). Birmingham City Council, by contrast, serves a population of more than a million people.      

The City of London council is responsible for local authority functions for only 1.2 square miles, which is the smallest area by far of any local authority. So there is less local authority work for its numerous members to do, most of whom are in any case untroubled by any significant constituency work.

Most of the 25 wards of the City of London council are dominated by business voters, who are notoriously disengaged with it: most businesses don’t register to vote, and of those that do, most of their appointees don’t turn out. This means that many members representing those wards – who are often elected in only double digit votes – typically have little to no constituency work, because their electors don’t know or care who they are. By contrast, councillors in every other local authority typically have a significant workload because their constituents are residents who care about what happens where they live.

The City of London council does undertake certain responsibilities in addition to its local authority functions, such as owning and managing Hampstead Heath, Epping Forest, the Heathrow animal reception centre, three private schools, various school academies, etc. These “external” activities explain the council’s remarkably high number of employees: 3,640 compared with Westminster’s 2,230, although the latter council covers a much wider area and serves a population of 253,000. The supervision by City council members of the additional staff involved in these “external” activities is not burdensome, however: the Hampstead Heath, Highgate Wood and Queen’s Park Committee, for example, meets only once per quarter.

The City of London council mainly promotes itself as representing the financial City. But that isn’t really true, as explained in our last post. The council uses its quasi-public endowment fund called “City’s Estate” (formerly “City’s Cash”) to fund some peripheral propaganda for the financial sector, a few small scale initiatives that the sector could easily fund itself and the greatly exaggerated “convening power” of the Lord Mayor. In any case, it is a fact that only a handful of members have any involvement at all in this supposed representative activity: most spend all their time on committees dealing with the council’s local authority and “external” activities.

There is another fundamental difference between members of the City of London council and those of all other local authorities, which is that City members receive substantial benefits in kind that are unimaginable elsewhere. Here are some examples:

– City committee meetings are typically held in the late morning or early afternoon, enabling committee members to have a three course lunch with wine for free in the members’ own Guildhall Club (of which membership is also free) either after or before their meetings. If they don’t have a committee meeting on a particular day, members can lunch in the club and use its bar, together with guests, at heavily subsidised rates.

– Members also have the use of bedrooms in the Guildhall for free if their stay is related to a late evening or early morning official function, or at heavily subsidised rates at other times.

– Members have the use of free and secure underground car and cycle parking in the heart of the City.

– Members have access all day to free soft drinks and snacks in the Members’ Room in the Guildhall, which consists of a lounge and computer room, as well as free shower and locker facilities. (Guildhall staff used to have access to an in-house restaurant in the basement until it was closed due to a lack of funds, although there are billions in City’s Estate, which can be used as the council wishes.)

– One of the most cherished perks is for members to attend (for free, of course) glittering banquets in the Guildhall or Mansion House, where they can sometimes be in the presence of royalty, the prime minister or foreign heads of state.

– Every committee has a free formal annual dinner for its members and official guests.

– There are free informal briefing breakfasts and suppers for members in the Guildhall.

– Every year all members are invited in groups to a free en famille lunch in Mansion House with the Lord Mayor.

– Some committees organise their own beanos, one of the most notorious being the Port Health and Environmental Services Committee’s annual river “inspection”, where nothing gets inspected, but champagne flows on a cruise on the Thames…

– Members get free tickets once a year to LSO concerts and similar events.

In addition to all these perks, City members get one that can’t be measured in money: a sense of self-importance of belonging to this ancient institution, and the privileged status it gives them in their livery companies and ward clubs.

In other local authorities, the life of a member is a dull round of constituency, party and council meetings. In the City council, la vie est belle – even without being paid in cash (as members of other local authorities are).

Goldsmiths’ Hall, the venue of the annual Policy and Resources Committee dinner on 19/2/24. The hall is just ten minutes’ walk from the City council’s dilapidated Golden Lane housing estate that continues to decay because the council’s leaders refused to spend money on its timely renovation out of “City’s Estate”, which is the fund used to pay for this dinner.

THE OLD CONSENSUS

For many years, there was a broad consensus among City council members that they shouldn’t be paid cash allowances. They claimed to be volunteers, freely giving of their time. That wasn’t true: volunteers, by definition, don’t get remunerated, whereas City members were handsomely paid in kind.

The reason for members (falsely) claiming volunteer status wasn’t (pretend) altruism. There has long been a sense of anxiety that the City council is only the stroke of a parliamentary pen away from abolition, which has nearly happened on more than one occasion in past decades. A justification for having so many members representing so few people and doing so little was that they weren’t paid, unlike elected members everywhere else.

From time to time informal proposals were made by some City council members that they all be paid cash allowances, the last one being led by Edward Lord in 2017, but they were always brushed off. That started to change from 2019.

OPERATION SELF-ENRICHMENT: PHASE ONE

The old consensus started to crumble after Chris Hayward effectively took over the leadership of the Policy and Resources Committee around 2019, while he was still its Deputy Chair and Catherine McGuinness was a lame duck Chair – a situation not unlike Boris Johnson and Theresa May in national politics. Hayward formally became Chair in 2022 when McGuinness’ dismal five year term ended.

In July 2021, the leaders put a formal proposal to all members that each member be paid an annual allowance of £7,500, although members could opt out of receiving it if they wished. There was no mention of withdrawing the substantial benefits in kind that members already enjoyed. Hayward personally introduced the proposal, explaining that it would “enhance the diversity of the Court of Common Council and ensure that prospective candidates for election to the Court are not deterred from standing for election for any reason, including any prohibitive cost. This is a view shared by the Members Diversity Working Party and more recently by the Tackling Racism Taskforce”.

“Diversity” in this context must mean only a lack of financial resources, as that is the only thing which an allowance could address.

Regarding this limited and less usual meaning of “diversity” as a reason for accepting the proposal, a number of questions arise. Why would anyone with limited financial resources want to become a member to:

– pretend to represent the financial City, which can (and does) represent itself without the City council’s peripheral propaganda, initiatives and “convening power”;

– supervise through committees the City council’s “external activities”, like private schools; and

– represent business voters from big companies who have no use for member representation?

The only logical reason for anyone with limited financial resources to want to become a member would be if they were a City resident and wanted to represent their fellow residents against their bad landlord, the City council. In this case, the allowance would be justified. Such a member would more closely resemble councillors in other local authorities, having a significant constituency workload and typically being less interested in City perks.

The proposal was accepted by members. Since then, around 70% of them have taken up the allowances, which is far more than the handful of members who fall within the description in the preceding paragraph. There was one former member in a business ward who didn’t lack financial resources but took the allowance in order to spend every penny of it on procuring legal and technical advice to aid residents in their battles with the council. Perhaps other members who don’t lack financial resources could either do the same, or disclaim the allowance?

It would be out of character for Hayward and the rest of the leaders to go to the trouble of proposing these allowances only for the sake of a handful of residential members who deserved them. It was clear from the terms of the proposal that leaders regarded the introduction of these basic allowances merely as Phase One of their plan to obtain much more substantial allowances for themselves. Note these words slipped into paragraph 14 of the proposal made in July 2021:

“Support has been given [by whom? – not specified] to Special Responsibility Allowances (SRA) being introduced in due course. Once the … [basic allowances are] in place and, following the implementation of the outcomes of the [Lisvane] governance review and the all-out Ward elections [in March 2022], further work will be undertaken on SRAs.”

Once members had got used to the idea of being paid cash allowances, and once most had taken them up, it was time for the leadership to move on to Phase Two.

OPERATION SELF-ENRICHMENT: PHASE TWO

While the leaders can normally rely on the passive support of a majority of members, whose real motivation is to enjoy the status of being a City member plus the substantial benefits in kind and now a cash allowance, the leaders need to tread carefully when taking action which might suggest that those members are being taken for fools. That is why the leaders, through the Civic Affairs Sub-Committee, appointed two “independent” reviewers to produce a detailed report which concluded that  a number of committee chairs should be paid substantial “special responsibility allowances” that the leaders wanted.

The “independent” reviewers’ report, dated December 2023, is marked “not for publication”, but has been leaked to us in the public interest. 

Its authors were Sir Rodney Brooke CBE, DL, and Dr Anne Watts CBE. They were a canny choice, because:

– they are both members of the London Councils Independent Remuneration Panel, which makes them look suitably qualified to advise on the “special responsibility allowances”;

– their panel conveniently recommends higher remuneration than many London councils (which are not bound by its recommendations) are willing to pay; and

– they appear to have been extraordinarily gullible in letting themselves be manipulated by the City council’s leaders into recommending what they wanted.

Gullible “independent” reviewers Sir Rodney Brooke CBE, DL and Anne Watts CBE: you don’t get honours for saying what those in authority don’t want to hear.

Their gullibility is evident from the pages 1 and 2 of their report, which read as if they were written by the City council’s PR team, full of breathless prose about:

– the value of the council, which “is a unique institution … seen [by whom, apart from itself?] as a champion and spokesperson for the UK’s financial services industry”; and

– the integrity of its members “who do not stand for election … in the expectation of remuneration [what about the substantial benefits in kind, and now the basic allowance?]  – though, of course, service in the City Corporation can bring kudos and prestige [so that’s alright then] “. 

From pages 3 to 11, the reviewers laboriously consider comparators for the roles of the committee chairs in determining how much extra they should be paid.

On pages 12 and 13, the reviewers assess how much time is spent by the committee chairs who are to be paid. Did they not wonder why, in the City council’s committee – as opposed to cabinet – system of government, chairs need to spend so much time outside the committees they should simply be chairing and whose members should collectively be making decisions? Had the reviewers read the disclosures made in this blog, they would have realised that real decision-making in the City council is opaque and concentrated in the hands of a few members, supported by senior officers. The “special responsibility allowances” would effectively reward oligarchs and their supporters.

On page 14, the reviewers set out a list of questions which – as a leaked officers’ report dated January 2024 to the Civic Affairs Sub-Committee reveals – they had originally wanted to put to all members “to aid in their [the reviewers’] understanding of the various roles and responsibilities, and help inform proposals which reflect a shared understanding amongst Members of the relative commitments associated with specific posts”. The reviewers’ request that these questions be put to all members spooked the Civic Affairs Sub-Committee. Seeking unmanaged and unfiltered input from all members is not how the council works – that would be dangerously close to democracy, and might produce a result undesired by the leaders (like the answer “no” to any “special responsibility allowances”).

The officers’ report to the Civic Affairs Sub-Committee records, with dry understatement, that at the sub-committee’s meeting in July 2023 it was “cautious of consulting [all members] at this stage …” and that “It was agreed [by that sub-committee] that it would be more appropriate for the Reviewers to consult initially with a select group to provide greater context, and endorsed previously approved arrangements for the Chair and Deputy Chair [of that sub-committee], together with the Town Clerk, to agree the format and interviewees of the consultation. Following this meeting, the Chair and Deputy Chair approved a list of Members and officers as appropriate for the reviewers to consult.”

The report continues that in October 2023 “the Reviewers were continuing to consult with the above individuals. The Sub-Committee noted the importance of consulting with [all members] once the report was complete, but felt that the Sub-Committee would need to review the findings and recommendations in advance of this”. 

The reviewers meekly complied with this blatant manipulation of their information gathering process. On page 14 of their report, they list the “select group” to whom they were allowed to speak. All of that group are leaders and senior officers who do their bidding. The reviewers also refer to a few unidentified “backbenchers”, whose on-message comments recorded on pages 15 to 16 strongly indicate that they are the usual suspects who can be relied upon by the leaders to say the right thing. The reviewers note that all the members they consulted “were remarkably consistent in their views [what a surprise]. However [the reviewers added, perhaps dimly sensing that they were being duped] the recommendations in this report are entirely our own”.

From pages 17 to 26, the reviewers set out those recommendations, which we tabulate below (adding in parenthesis the names of the current office holders who are recommended to receive “special responsibility allowances”):

Chair of Policy and Resources Committee (Chris Hayward): £90,000

Deputy Chair of Policy and Resources Committee (Keith Bottomley): £32,500

Chair of Finance Committee (Henry Colthurst): £62,000

Chair of  Police Authority Board (James Thomson): £62,000

Chair of Planning and Transportation Committee (Shravan Joshi): £62,000

Chief Commoner (Ann Holmes): £32,500

Chair of Community and Children’s Service Committee (Ruby Sayed): £47,000

Chair of Epping Forest and Commons Committee (Ben Murphy): £47,000

Chair of Hampstead Heath, Highgate Wood and Queen’s Park Committee (William Upton): £47,000

Chair of Port Health and Environmental Services Committee (Mary Durcan): £47,000 

Chair of Culture Heritage and Libraries Committee (Munsur Ali): £47,000

Chair of Gresham (City Side) Committee (Edward Lord): £32,500

Chair of Audit and Risk Management Committee (Prem Goyal): £32,500

Chair of Markets Board (Henry Pollard): £32,500

Chair of Digital Services Committee (Dawn Wright): £17,500

Chair of Health and Well Being Board (Mary Durcan): £17,500

Chair of Pensions Committee (Timothy Butcher): £17,500

Chair of Corporate Services Committee (Alastair Moss): £17,500

Chair of Licensing Committee (James Tumbridge): £8,500

Chair of West Ham Park Committee (Caroline Haines): £8,500

Chair of Natural Environment Board (Caroline Haines): £8,500

Total of “special responsibility allowances”: £769,000

The first five people listed above do spend a lot of time performing their roles, but – as already explained – they shouldn’t need to if the council’s committee system of governance worked the way that it should, instead of the way that it does, where committees are used to approve the actions of an oligarchy (or autocracy, given the direction in which Hayward is heading).

The role of Chief Commoner – which, like that of Chair of Policy and Resources, comes with free accommodation in the Guildhall during the holder’s term of office – is a full time role that consists of doing unimportant things. If it wasn’t a medieval legacy, it wouldn’t exist. If it was abolished tomorrow, no-one (except the Chief Commoner) would be the worse for it.

Ruby Sayed, the current Chair of Community and Children’s Services, is recorded on pages 20 and 21 of the reviewers’ report as telling them that “the responsibilities of the post are measured not by the time devoted to them [which is just as well in her case, as she isn’t notably well prepared for meetings]. They are significant and epitomised by the consequences if something goes wrong: if the social care service fails to intervene in timely fashion in cases of abuse the consequences can be devastating. The Chair carries that responsibility.” The reviewers, in their gullibility, believed her. Had they read this blog, they would know that Sayed isn’t always truthful. In any case, didn’t it occur to them that with such a small number of residents compared with other local authorities, the City council’s potential need for intervention was correspondingly small? And if something did go wrong, that would be the responsibility of the staff and ultimately their director, not the chair of the supervising committee who has no operational role and isn’t qualified to have one.

All the roles listed above from Chair of Community and Children’s Services downwards do not come close to being full time jobs, or even part time ones. Like all members, their holders are already entitled to a basic annual allowance of £7,500, substantial benefits in kind and the all-important “kudos and prestige”. 

One role that particularly stands out as a sinecure is Chair of Gresham (City Side) Committee, currently Edward Lord. This obscure committee meets for only around two hours three times a year. It nonetheless  carries prestige within the council, and more than half its members are masons. The reviewers’ recommendation that its Chair receives a £32,500 “special responsibility allowance” should, of itself, be sufficient to consign their report to the bin (although it’s expensive rubbish: the officers’ report discloses that £15,000 has been set aside to pay the reviewers).

Edward Lord: recommended to earn £32,500 for chairing three meetings per year of two hours each of an obscure committee.

The number of undeservedly remunerated posts is logical in the Machiavellian politics of the City council. It is likely that most of the 19 current holders (four of the 21 roles are held by two people) will vote in favour of their receiving “special responsibility allowances”. We hope that Henry Colthurst, the Chair of Finance, will vote against this unworthy proposal, but have no hope that Hayward, Bottomley, Joshi or Sayed will follow his example. All the roles to be specially remunerated have limited terms of office, so there will be a further 21 members expecting to succeed as chair in the near future. We already know that Peter Dunphy will succeed Ann Holmes as Chief Commoner in April 2024. The Court of Alders typically votes en bloc to support the leaders, with the honourable exceptions of Sue Pearson, Martha Grekos and (on a good day) Christopher Makin, thus adding another 22 votes to those in favour. That makes a total of 62, which – with the addition of some non specially remunerated members who will vote with the leaders, because they always do – makes a majority.

Like the basic allowances, the “special responsibility allowances” will be presented to members as necessary “to help break down any barriers, perceived or real, that might exist to discourage individuals from standing as a … Committee Chair” (per the officers’ report to the Civic Affairs Sub-Committee in January 2024). This reasoning is fake. Real barriers exist to members becoming committee chairs, and they have nothing to do with those members’ financial resources. Members can typically only become committee chairs if they support the leaders. The list of committee chairs does not include a single establishment critic.

If the leaders were serious about “diversity”, they would change the times of committee meetings to early morning or early evening as in other local authorities to suit members who have regular jobs, rather than to suit the convenience of those who are retired. This is repeatedly raised by a number of working members, and repeatedly rebuffed. Even the reviewers thought this was an issue: in the last sentence of their report, they diffidently suggest that:

“Though our remit – and therefore our recommendations – are confined to the remuneration of members of the City Corporation, we believe that since the culture of the Corporation is changing [something City residents haven’t noticed], it should also consider other measures which could widen the pool of candidates for the possibility of service on the Corporation, including such arrangements as maternity leave and evening meetings”.

That is not a subject on which members will be asked to comment in non-public, internal consultation sessions on 26/2/24, 27/2/24 and 1/3/24.

The Civic Affairs Sub-Committee received the “independent” reviewers’ report at its meeting on 29/1/24, and supported the principle of introducing “special responsibility allowances”, especially for the Chair of Policy and Resources. Interestingly, there appears from the minutes of that meeting to have been a little dissension about the report’s detailed recommendations. The chair of the sub-committee, Tom Sleigh, also chairs the Barbican Centre Board, which is a more important than body than many of those whose chairs are proposed to receive “special responsibility allowances”, but Sleigh is proposed to receive nothing, apparently because the reviewers thought that the kudos of his role should be reward enough. He is recorded to have proposed that the funding “envelope” for the “special responsibility allowances” [£769,000] be spread among all members so as to increase their basic allowance.

We are hearing that there is already a degree of discontent about the “special responsibility allowances” even among some members who normally support the leaders. Perhaps they realise that they’re being taken for a ride. Or perhaps they’re upset that more money isn’t proposed to go to them. We expect, though, that the leaders will brazen this out, at least for those in the top half of the list, as they literally have too much to lose.

If the “special responsibility allowances” are approved by members, the £769,000 needed each year to fund them will be paid out of “City’s Estate”. That will be in addition to part of the £650,000 + needed each year to pay their basic allowances, and the £300,000 + needed each year to subsidise the Guildhall Club that provides members with free or heavily subsidised lunches and drinks. We don’t have the figures for the cost of members’ accommodation in the Guildhall, their attendance at various dinners and banquets or their various other perks, but they must be considerable. It seems the council is planning to claw back money from residents through council tax and social housing rent hikes.*

When Sue Pearson proposed in January 2022 that this same fund be used to accelerate the renovation of the City council’s relatively small housing estates which have fallen into disrepair due to decades of neglect, which is in turn due to decades of poor leadership by members like Michael Snyder, the leaders and their supporters voted it down. So City tenants shiver in winter because window replacements that have been overdue for decades remain on the council’s “to do” list, while the payment of “special responsibility allowances” to the leaders and their supporters are to be implemented “as quickly as possible” in the 2024-25 financial year.

Who can doubt that this ancien régime is on the road to the political guillotine? There is only so much provocation that people can take.

Notes

*City of London proposes £400k for ‘possible increases’ to members allowance while potentially hiking social rents. The Corporation is looking at increasing council tax and Adult Social Care by a combined 4.99%, and social rents by 7.7% by Ben Lynch, My London News, 21 February 2024: “…the 2.99% council tax hike would bring in £247,000 extra per year…. Committee members also agreed recommendations including a 7.7% increase in social rents for the year ahead… Among the other items given the green light was a £400,000 provision for ‘possible increases to members allowance’. Deputy Elizabeth King said the committee needs to think ‘very, very carefully’ about such a move at a time when the Corporation is looking at hiking social rents. ‘The optics of that, if nothing else, are dreadful,’ she said.” Read the full piece here.

Chris Hayward, the City of London council boss, who is potentially in line for an extra £90K a year – on top of the lucrative consultancy work he and some of his fellow councillors do as day jobs.