British Council censured for executive pay topping PM's salary without signoff
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Version 0 of 1. The British Council has been criticised by independent auditors after paying its chief executive and chief financial officer more than the prime minister, without seeking prior approval from the Treasury. The organisation, which provides education and cultural opportunities abroad using public money, paid its new head, Sir Ciaran Devane, £185,000, while its CFO, Caroline Stockmann, was given a salary of £142,000 along with a one-off payment of £11,837, the National Audit Office found. Any executive payments worth more than the prime minister’s package of £142,500 should be approved by the Treasury before being approved. As a result, the Foreign Office, which oversees the British Council, has been fined £200,000. It is thought to be the first time the Treasury has fined another government department for allowing excessive payments to senior executives. The National Audit Office said Greg Hands, the chief executive to the Treasury, was asked retrospectively to approve the payments but refused to do so. Hands also imposed a reduction of £200,000 in the budget of the FC, the NAO said. The British Council’s funding will in turn be reduced by £200,000 and further reductions may also be made in 2015-16. Sir Amyas Morse, head of the NAO, wrote: “In the absence of the necessary approvals form the chief secretary to the Treasury, I have concluded that the remuneration packages agreed in excess of the levels requiring approval are not in conformity with the authorities which govern them and are materially irregular. I have therefore qualified my audit opinion.” The Guardian was made aware of inquiries into the organisation’s pay to executives last week. On Monday, the British Council’s director of communications, Sao Bui-Van, denied that there had been inquiries into executive remuneration or a review of how pay is distributed. Asked in an email if the organisation was happy with executive pay, he wrote: “ I can advise that in terms of executive remuneration, this is benchmarked against similar roles in other organisations.” Following the release of the NAO’s report on Thursday morning, he wrote: “We accept the National Audit Office’s qualified opinion on these matters. We have also reviewed our recruitment and remuneration processes to ensure that Cabinet Office and HM Treasury requirements are adhered to in future.” |