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The Government’s spending watchdog says a closer eye needs to be kept on the pay of arms-length body CEOs “to drive greater consistency and demonstrate value”.
In her latest review, Comptroller and Auditor General Lynn Pamment pointed out that numerous recommendations have been made in respect of directors’ remuneration over the years but “many have not been implemented in full”.
Arms-length bodies are public-owned and largely public-funded entities which carry out functions on behalf of the Government.
Pictured: Comptroller and Auditor General Lynn Pamment pointed out that numerous recommendations have been made in respect of directors’ remuneration over the years but “many have not been implemented in full”.
These range from the key utility companies (JT, Jersey Electricity and Jersey Water) to housing providers such as Andium and the States of Jersey Development Company, as well as promotional bodies such as Visit Jersey, Digital Jersey and Jersey Finance.
In 2019, Ms Pamment’s predecessor authored a report on the topic of ALO Directors’ remuneration containing six recommendations – only one was implemented, another partially implemented, while four were not.
Among the recommendations to be set aside was a suggestion that government should introduce a requirement for ALOs to include details of directors’ remuneration – broken down between basic pay, bonuses, and other contributions – and features of any bonus schemes in their annual reports.
Pictured: The report suggested that government should introduce a requirement for ALOs to include details of directors’ remuneration – broken down between basic pay, bonuses, and other contributions – and features of any bonus schemes in their annual reports.
Ms Pamment’s latest report noted, however, that some organisations supply some of this information.
She also highlighted that some organisations do not include any details of the remuneration of their most senior executive – something she said does “not meet best practice in respect of transparency”.
In the latest report, Ms Pamment recommends that a “remuneration framework” should be established for all “senior executives and chief executives (or equivalent) of States-established delivery entities and of independent bodies and office holders”.
She also called upon the government to “ensure that the application of the relevant framework is consistently applied” across all entities.
It comes as Scrutiny have also been looking into Director-level remuneration.
At a recent hearing, Treasury Minister Elaine Millar was questioned about how, as shareholder, she holds each entity to account.
She said: “I've had conversations with some of the chairs about pay rises, and absolutely, I challenge them about things on pay rises. And are they right? You know, are we setting things at the right level? Is it enough to focus on that, you know? So that is, I do challenge on it.”
The basic salary for the Chief Executive of Ports of Jersey has steadily grown over the years, with pay rising from £200,000 in 2020 to £272,000 in 2023. The bonus last year amounted to around 50% of salary.
Pictured: At a recent hearing, Treasury Minister Elaine Millar was questioned about how, as shareholder, she holds each entity to account.
Asked whether there was a process for aligning ALO salaries in light of the Ports of Jersey pay rise and bonuses, Deputy Millar said she felt it was “difficult” to align them.
Noting that Ports of Jersey was one of several providing a “critical” service to the island, she continued: “It would be easy to look at someone's salary and say, ‘Oh, that's a lot.’
"But then, if we had some kind of issue, and we didn't have any boats coming in for a week, you could have all your constituents hammering on your door saying, ‘When are we going to get food into the supermarkets?’”
When challenged over the level of bonuses some CEOs had received, the Minister said: “I'm told, in some instances in the UK, people get 100% of salary as a bonus… These have to be right for Jersey. And again, that is something I have challenged.
"I think we have to remember that our private sector in Jersey is very much smaller, but people doing this job in other parts of the UK and Europe with whom we are competing for staff are paying maybe even more generous bonuses.”
Deputy Jonathan Renouf asked the Minister whether she thought it would be appropriate to take a “moral stance” in respect of salary, such as making the CEO’s salary a multiple of the bottom 10% of employees.
Pictured: Deputy Jonathan Renouf asked the Minister whether she thought it would be appropriate to take a “moral stance” in respect of salary.
“You could try it,” the Minister responded, “but it may then mean that you lose staff and you can't recruit someone at the same level of competency, capability. You do have to look to the market.
“We could take that kind of stance, but if that stance means we have someone in post who is, frankly, not up to the job, and we don’t have boats coming in, we lose connectivity, we have not benefited the island by taking the moral high-ground.”
The Treasury Minister recently provided a breakdown of top-level pay at each of the island’s main ALOs.
In 2023, the Andium Homes CEO made £214,250 with a £20,000 bonus, whilst the JT CEO received a £285,000 salary with a £104,000 bonus.
The CEO of Jersey Post received a £261,000 salary last year with a £106,000 bonus, and £10,000 of "other benefits".
Meanwhile, the Ports of Jersey CEO made £272,000, with a £137,000 bonus.
The CEO of the States of Jersey Development Company received a £203,308 salary in 2023, with a £61,399 bonus.
The Jersey New Waterworks Company CEO made a salary of £197,000 in 2023, with a £38,000 bonus and a £12,000 of "other benefits" – including private health care, death in service insurance, and a car allowance.
And the Jersey Electricity CEO received a £298,515 salary last year, with a £93,000 bonus plus £56,440 deferred bonus, and £16,255 of "other benefits".
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