Last week it was the former boss of the Council of the Isles of Scilly – revealed to have collected a pay off in excess of £200,000 when he left the local authority – who was under the microscope for his ‘golden goodbye.’ Today the Western Morning News reports that 18 senior NHS staff in the Westcountry have, between them, collected close to £1 million in ‘exit’ packages. The payouts, by no means exceptional for ex-HNS senior managers, have prompted MP Neil Parish to warn hospital trusts that they do not have a “bottomless pit” of funds and they should be investing in Accident and Emergency services, not pay-offs for departing executives.
He is right. Of course the Trusts themselves will quote contracts and legally binding agreements and claim their hands are tied. They may, technically, be right. What is most definitely not right, however, is that public sector bodies, whether health trusts, local authorities or departments of Government, take a completely different approach to many commercial businesses on this issue. The trusts seem content to pay out vast sums to departing individuals at a level that would be completely unacceptable in many parts of the private sector.
The private sector has to make a profit, of course. Its managers are, in many cases, answerable to shareholders and investors. That clearly focuses minds. As Mr Parish says: “Many companies are not paying much more than statutory pay-offs, so it is hard to justify golden goodbyes (in the NHS) at this level.” No one denies that redundancies reduce overall wage bills and that one-off pay-offs can be recouped over time. But when the pay-offs are vast the time it takes to reap the financial benefit of losing a senior and very well paid manager, is extended. Add to that the basic unfairness of rewarding a public sector employee far more generously than many at a similar level in the private sector – and with taxpayers’ money – and you have a system that is unsustainable.
It is true that there may be some individuals who are leaving the NHS after giving sterling service for many years and who deserve to be well-treated on their departure. But none of that alters the basic problem that the public read and hear almost daily about financial difficulties with the NHS, often affecting patients. How are they supposed to square that with pay-offs into the hundreds of thousands of pounds for senior staff who have been well-rewarded through their careers and may well be going on to do other well-rewarded jobs after leaving the health service?
If the fault lies with the contracts then the contracts, at least in the future, must be changed. There may have been a time when these things mattered less and were less closely scrutinised by the public. No more.
There is no excuse for over-paying anyone in the public services, particularly when they are leaving their post. Health Trusts, like everyone else, must get real.