Jason Breton’s Testimony: Recruitment Policies and Market Rates
Mr Breton confirmed that Liverpool City Council currently has a recruitment policy in place, though he was unsure of its exact title or whether the 2012 policy produced to the inquiry remains current, noting it seemed dated. He acknowledged that recruitment of council employees is significantly governed by the Local Government Act 1993 (NSW), which mandates employment based on merit and allows temporary contracts generally limited to 12 months, with possible extensions in specific circumstances like parental leave.
The discussion also covered salary determination, guided by the Local Government Award and the council’s salary scheme, which sets baseline remuneration. However, Mr Breton noted the application of “market rates” in certain cases, a practice where salaries are adjusted based on market surveys to attract talent. He cited evidence from Mr Dansie, who mentioned that market rates are determined by referencing surveys from organisations like Mercer for comparable positions. Mr Breton clarified that his personal approach is to have roles at manager level and above independently assessed by Mercer for market rates, distinguishing this from the standard award and salary scheme amounts.
Specific Examples and Practices in Applying Market Rates
A notable example provided was the recruitment of planners and senior planners during the tenure of former CEO John Ajaka. Mr Breton explained that Director Kakish faced difficulties attracting planners due to market conditions in 2021-23, where planners could effectively “name their own price” amid a shortage driven by high demand for development applications (DAs) and construction activity. This led to an application to the CEO to offer market rates, justified by surveying comparable councils, which significantly reduced DA processing times from 1300 to below 300. The Commissioner and Mr Breton agreed this shortage affected multiple councils, with a “cannibalisation” of the same talent pool, often losing government planners to the higher-paying commercial market.
Mr Breton noted that while there may not be a formal policy on when to apply market rates for roles below manager level, applications for such adjustments are made by directors or managers to the CEO, who reviews and endorses or rejects them based on evidence like market surveys or memos. He confirmed the CEO’s involvement ensures the offered rate reflects actual market conditions, providing a layer of oversight. The session also previewed a detailed examination of the senior adviser position, which historically existed from 2012 to 2016 and involved market rate payments, though specifics were redacted in public documents, with unredacted copies available in the hearing room for precise questioning.
Matters of Importance to Liverpool Ratepayers
- Application of Market Rates and Financial Oversight in Recruitment
Ratepayers should be aware of the council’s practice of paying market rates for certain positions, particularly during talent shortages, as seen with planners in 2021-23. While this approach successfully reduced DA processing times, it raises concerns about fiscal responsibility and transparency. Ratepayers might perceive this as potentially inflating costs beyond standard award rates without a clear, publicly accessible policy justifying such expenditures. The involvement of the CEO in approving these rates offers some accountability, but the lack of a formal, updated recruitment policy (with the 2012 document possibly still in use) could be seen as a governance gap, risking inconsistent or unjustified spending of public funds. This matters as it directly impacts how ratepayer money is allocated for staffing, a core component of council service delivery. - Impact of Market Conditions on Service Delivery and Costs
The discussion around the planner shortage and the broader market dynamics affecting multiple councils highlights a systemic issue that ratepayers need to understand. The necessity to “buy” talent at a premium to maintain service levels (like processing DAs) suggests that ratepayers may indirectly bear the cost of competitive labour markets through higher salaries. While the outcome of faster DA approvals benefits the community, the perception could be that the council is reactive rather than proactive in workforce planning, potentially leading to recurring cost overruns. Ratepayers might question whether long-term strategies, such as training or retention incentives, are in place to avoid such market-driven spikes in expenditure, ensuring sustainable value for their rates.
Broader Implications
Day 24’s testimony reveals critical insights into how Liverpool City Council navigates recruitment challenges within the constraints of the Local Government Act and market pressures. The use of market rates, while effective in addressing immediate staffing needs, underscores potential vulnerabilities in policy clarity and financial planning that could affect service efficiency and cost management. For ratepayers, these discussions highlight the balance between attracting necessary talent and maintaining fiscal discipline, a core concern in local governance. The inquiry continues to explore these operational intricacies, with further examination expected in upcoming sessions to clarify recruitment practices and their implications.
