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States Members Remuneration Review Body: recommendations for 2011.

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STATES OF JERSEY

STATES MEMBERS REMUNERATION REVIEW BODY: RECOMMENDATIONS FOR 2011

Presented to the States on 2nd July 2010 by the Privileges and Procedures Committee

STATES GREFFE

2010   Price code: B  R.93

STATES MEMBERS REMUNERATION REVIEW BODY: RECOMMENDATIONS FOR 2011

The  Privileges and  Procedures  Committee  is  pleased  to  present to the  States  the recommendations of the States Members Remuneration Review Body (SMRRB) for 2011. The terms of reference of the SMRRB require it to present its recommendations to PPC and the Committee is then obliged to present the recommendations to the States.

In  accordance  with  the  procedures  agreed  by  the  States  when  establishing  the independent SMRRB, the recommendations of the Review Body in this report will be implemented by default after one month of the date of presentation to the States unless they are challenged by the lodging of a proposition by any member and a subsequent debate. PPC believes strongly that, having established an independent Review Body it would be inappropriate for the Committee, or indeed for other States members, to challenge the recommendations, as that would simply defeat the object of having an independent body to consider remuneration matters.

PPC would like to express its sincere gratitude to the members of the SMRRB for the work that they continue to do on an honorary basis on their task and for the very comprehensive way in which they have always approached it.

STATES MEMBERS REMUNERATION REVIEW BODY RECOMMENDATIONS FOR 2011

Summary of conclusions and recommendations with regard to remuneration (including expenses)

  • The Review Body recommends an increase of £800 per annum to apply from 1st January 2011, to take the annual remuneration of States members from £40,382 to £41,182,
  • The Review body recommends that the expense allowance of £3,650 per annum remains unchanged.

Recommendations explained in detail

The Review Body was reconvened late in 2008 to consider a recommendation for the three year period 2009-2011 when it recommended an interim increase of £1,000, with no increase in the annual expense allowance, to be effective from 1st January 2009.

The Review Body published a discussion document in January 2009, and held two public meetings as part of its consultation process.

The States Employment Board announced a pay freeze effective 1st June 2009 on public sector salaries in April 2009 and, while the Review Body is not bound by such policy statements, it is obliged to take them into consideration together with representations from the public and from States members themselves.

Following the considerable public response to the discussion document and to some degree in consideration of the above policy statement, the Review Body recommended that the interim increase of £1,000 should be final and the monthly expense allowance should remain unchanged throughout 2009.

At  the  same  time the  Review  Body  considered  that the  response  both  from  States members themselves and from the wider public suggested that the pay freeze should apply  to  States  members,  notwithstanding  the  fact  that  the  rate  of  increase  in  the remuneration of States members in recent years had failed to match that of broadly comparable groups in both the public and private sectors. Therefore the Review Body recommended no increase for 2010.

A year ago the Review Body did not consider it appropriate to make recommendations which  would  apply  beyond  the  end  of  2010  on  the  grounds  that  the  economic circumstance were likely to be increasingly unpredictable as follows:-

"While  our  terms  of  reference  would  normally  require  us  to  make  a recommendation  for  the  three  year  2009-2011  we  decline  to  make  any recommendation for 2011 at this stage, preferring to reconsider the matter in May 2010 with a view to making a recommendation in respect of 2011 on the basis of the evidence we have so far collected when taken together with a review of the circumstances prevailing at that time."

The  Review  Body  noted  that  the  States  members  accepted  its  remuneration recommendations for 2009 and 2010 without debate.

Early this year it became clear that the States Employment Board was seeking to limit public sector increases to 2% in respect of 2011. At the same time public sector pay was to be considered on a calendar year basis rather than from 1st June to the following 31st May.

The Review Body had always made recommendations on a calendar year basis, so the timing of adjustments in public sector pay became synchronized with those of States members.

Subsequently, in determining what would be appropriate for States members for 2011, the review body considered the above 2% limit in the light of the evidence it had collected in response to its earlier discussion document and opinions voiced before and since  by  States  members  themselves,  together  with  those  of  the  wider  public. It concluded  that  similar  considerations  applied  to  those  which  had  influenced  its recommendations for 2010.

While acknowledging that in general most employee groups may have fared better than States members in recent years, the Review Body considered that its terms of reference implied  that  it  would  be  inappropriate  to  recommend  a  greater  increase  to  States members than that which was negotiated with the public sector as well as what was reported  in  surveys  and  published  statistics  for  both  employees  and  self-employed persons in the private sector.

Pensions for States members

The Review Body remains committed in principle to its previous recommendation as set out in Part 2 of its 2009 recommendations (see R.62/2009) that a matched-contributions pension scheme for States members should be introduced for the reasons given in that report. However, it understands that, with the current States-wide moves to reduce

spending and restrict growth, no budget will be available to fund the development or installation of such a scheme in 2011 and regretfully it recommends that the introduction of such a scheme should not be pursued for the time being.

The Review Body wishes to thank again all those who responded both to its discussion document and subsequently.

The Review Body also wishes to acknowledge the considered opinions expressed at a joint meeting with the Privileges and Procedures Committee (PPC).

The  Review  Body  values  its  independence  and  it  neither  considers  this  to  be compromised by presenting the PPC with its assessment of the present context within which it is considering its recommendations nor by receiving the views of its sponsoring body.

Again thanks are due in particular to the Greffier of the States, Michael de la Haye, for his help and that of his department in supporting the activities of the Review Body during the last two years.

It  is  the  intention of the Review  Body  now  to  continue  to  keep  under  review  the economic situation of the Island and the level of increase in remuneration packages in the private and public sectors during 2010, with the aim of presenting its recommendations for 2012 ahead of the States Assembly's 2011 summer recess.

SMRRB Terms of Reference

The terms of reference of the Review Body are as follows –

To make recommendations to the Privileges and Procedures Committee on any matters relating to the remuneration, allowances and benefits available to elected members of the States as it considers appropriate, following the holding of public hearings and the receipt of oral and written submissions from any persons, including members of the States, having taken account of any other matters that the Body considers to be relevant, and having taken particular account, but not being bound by, the following matters –

  1. the  principle  that  the  level  of  remuneration  available  to  elected members  should be  sufficient  to  ensure  that no  person should  be precluded  from  serving  as  a  member  of  the  States  by  reason  of insufficient income and that all elected members should be able to enjoy a reasonable standard of living, so that the broadest spectrum of persons are able to serve as members of the Assembly;
  2. the economic situation prevailing in Jersey at the time of determination and the budgetary restraints on the States of Jersey; and
  3. the States' inflation target, if any, for the period under review.

Membership of the SMRRB

Mr. Julian Rogers (Chairman)

Mr. Brian Bullock

Mr. Maurice Dubras

Advocate Christopher Lakeman (resigned 2nd November 2009) Mr. John Mills CBE