Council's £1m redundancy bill

South Tyneside Council spent more than £1m in redundancy payments over the last year, new figures show.
Council redundancy cash.Council redundancy cash.
Council redundancy cash.

The Local Government Association (LGA) said the council is one of scores across the country have been forced to reduce their workforce sizes due to budget cuts – and despite dramatic increases in the volume and range of services provided

Department for Levelling Up, Housing and Communities figures show 31 people were laid off by South Tyneside Council in 2021-22 – at an average of £35,543 per person – meaning a total of £1,101,830 in exit packages last year.

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This was up from £892,175 in 2020-21 but well below the £2,432,276 paid out in 2019-20, before the coronavirus pandemic.

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

Andrew Western, chairman of the LGA's resources board, 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.”

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The figures also show 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.