Thousands of Sandwell Council staff could benefit from discount scheme

Around 5,000 council staff could benefit from a new employee discount scheme instead of pay rises, it can be revealed today.

Sandwell Council House in Oldbury
Sandwell Council House in Oldbury

Sandwell Council says it cannot afford to increase its workers’ salaries as it needs to make savings of £100 million by 2017, but is instead looking for outside help to make their money go further.

The authority is looking for an external firm to help establish an employee discount scheme which works by tapping into the council’s buying power as an organisation of that size.

Internal research has found half of council staff are at the top of their pay grade already, so this move is aimed at encouraging workers and helpiing retain them, while the authority cannot offer pay rises.

The authority has earmarked £35,000 to spend on an external firm for the first year of the scheme to help make this idea a reality.

The initiative will not involve school staff in the borough.

Council leader Councillor Darren Cooper said: “Staff haven’t had a pay rise so what I’ve asked the council to do is to look at how we can use its collective buying power to offer something back to staff.

Councillor Darren Cooper
Councillor Darren Cooper

“At the moment the council needs to make significant savings and we cannot afford pay rises so we want to look at other ways to save money for our staff.”

Part of the plan is for council staff to have an employee discount card, branded for the council, which is accepted by retailers in the borough.

The idea is to make the borough more prosperous as the 4,946 council staff across its 11 directorates are encouraged to spend more money in the area.

Another part of the scheme is advertising benefits available to council staff, including salary sacrifice – where workers give up some of their gross salary for a benefit like childcare vouchers, car parking, interest free bicycle loans and buying annual leave.

That has a benefit for the council too as it does not have to pay National Insurance on those options.

The authority hopes that by the second year of the scheme, the savings from NI contributions the council is no longer paying will mean the initiative pays for itself.

It is hoped to extend the council’s current salary sacrifice scheme to include things like a car lease and to link to local businesses so the council’s staff are spending their money in the area.

Comments for: "Thousands of Sandwell Council staff could benefit from discount scheme "

Mrs Ivy Trellis

So, Darren's plan is to shift the burden of Tax and National Insurance onto staff who have not seen pay increases, and he is looking for them to take a cut too?

Where are the savings on National Insurance? - Employers have to pay Class 1A Contributions (Benefits in Kind) at the end of each tax year. This merely shifts a monthly liability to being an annual one!

Any benefit to staff will be negated due to them having to pay additional tax for a 'Benefit in Kind!' - Suddenly, that 'Interest-Free Bicycle Loan,' does not appear to be so attractive! Staff can also be penalised for NOT taking certain benefits, as HMRC will deem that they were 'Available.'

There are also huge contractual issues, to be addressed - Which evidently have not been considered thus far. The cost of payroll and HR administration will be far more than £35,000!

Looking at the longer term, should staff elect to have their salary reduced, then their Pension Contributions will also fall (Employer and Employee Contributions), leading to a shortfall of pension entitlement upon retirement. Whilst this might appear to be insignificant, the reality can be somewhat different.

What is the colour of the sky on your planet today Mr Cooper?

middley

I can't begin to think what Don Darren will come up with next, Why should the council or the public feel the need to offer alternatives for pay rises, they should get in the real world of no pay rise = no pay rise end of, that's what we were told and if people are on the top grade for their job then so be it, get another job somewhere else like other people do. I don't see any job vacancies on councils so the staff can't be that fed up with it !

Dorothy

Smoke and mirrors from Mr cooper! Spending money (taxpayers) on madcap schemes.

Ivor

Sandwell wants to introduce a MRP system eh? On the chronological scale of business development

Sandwell council is just entering the 1970's , this is a £billion business run like a sweet shop.

Before this council ventures in to this new Car leasing business, I would be more happy if it sorted its children’s services problems., education problems and serious problems with its high streets

Cooper has given a perfect example that there are NO cuts in Sandwell, just more spend.

When this “New” idea just “Hopes” to break even by the second year ? the poor Sandwell council tax payers will pick up the bill in year one and for ever, when it fails.

Unless of course, can we all have a leased car ?

There again I couldn’t afford to pay the parking fees

KC

As a Sandwell Council employee, I am really pleased that the Council is trying to do something which will help in these difficult financial times. Our pay has increased by only 1% over the last three years, a pay cut of over 14% in real terms – this is a fact, not a complaint as many of us accept that the Council has no choice other than to respond to the cuts imposed by government.

Thank you Sandwell!!