Scrutiny and the Ogley pay off

This is the link to the Public Accounts scrutiny follow up on Ogley Pay off

Scrutiny Report Compromise Agreements


2. KEY FINDINGS
Note: The following findings are the overarching main findings from the Committee’s review. There are further findings within the report, however the Committee wishes to focus on the following and the recommendations which arise from these.

2.1 The decision to accept the amendments to the contract of the former Chief Executive
Officer was taken at a time when money was not subject to the restraints faced in 2012.
There had been no succession planning which had left the Island extremely vulnerable
and the post holder had become pivotal in the change to Ministerial Government which
left little choice given the desire to retain the officer’s services. The decision was nonethe-
less flawed. There had been no formal risk assessment or thorough investigation of
the options available between receipt of the request to revise the contract on 2nd March
2005 and the acceptance of the changes on 9th March 2005.

2.2 The change to the States of Jersey Law to have Chief Officers accountable to their
Ministers left a fracture in the lines of responsibility that continue to cause problems
today. When viewed alongside Ministers being ‘corporate sole’ and therefore not
responsible to the Chief Minister, the double fracture in the lines of responsibility create
confusion in the management structure at the highest level of the organisation.

2.3 Given that the decision makers may have been keen to retain the Chief Executive
Officer through the pinch point of the change to Ministerial Government, no time limit
was placed on the unusually generous agreement of 2.5 times salary. It appears that
this was simply not considered, leaving the huge cost to be met at any point the officer
might leave further down the line. This was unacceptable and expensive.

2.4 The result of the two breaks in the lines of responsibility of both the Chief Minister and
the Chief Executive Officer render them impotent. They are powerless and isolated.
Their duties can only be carried out with the good will of their “subordinates” and the
strength of character they can bring to bear.

2.5 In examining the termination of the former Chief Executive Officer’s employment, there
were many failures revealed.
· Performance management was woefully inadequate.
Compromise Agreements: Following up the investigations of the Comptroller and Auditor
General.
5
· The fractured lines of responsibility allowed the Chief Minister of the day to do
nothing, despite his recognition of the problems brewing.
· The Code of Conduct for Ministers is deficient and offers no sanctions for
transgressions.
· There was no management intervention in the longstanding deterioration in the
relationship between the Minister for Treasury and Resources and the former
Chief Executive Officer.

2.6 It is the combination of these failures that left no option but to pay the £546,337.50 to
the departing officer.

2.7 There is no clear demarcation of boundaries between policy setting by States Members
and operational implementation by officials. Blurring these lines can lead to
destabilisation of relationships and derailment of operational matters rendering them
ineffective.

2.8 Despite the blurring of roles between the Minister for Treasury and Resources and the
former Chief Executive Officer, the real concern is that, even knowing about the
difficulties, the then Chief Minister took no action and in so doing allowed an already
pressurised relationship to deteriorate to such an extent that the former Chief Executive
Officer decided to invoke the terms of his revised contract.

2.9 Relating to other compromise agreements entered into by the States over the last five
years, the Committee noted that the private sector has no issues with compromise
agreements. They are used as a tool for many reasons and money spent is recouped
over the following period.

2.10 The existing Human Resources Department is not fit for purpose in order to meet
modern day Human Resources requirements for the public service.

2.11 There is a place for compromise agreements as a management tool when appropriate
but all the other management structures must be in place first. Every agreement should
be considered on its worth, based on good performance management records and
consideration of the options available. It is only by meeting those standards that there
can be any hope of convincing the public that value for money is being achieved.
Compromise Agreements: Following up the investigations of the Comptroller and Auditor
General.

2.12 Looking at the way forward, the Committee notes the willingness that the current Chief
Minister shows in bringing forward changes to ensure these mistakes are not repeated
and looks forward to seeing the production of timelines for their introduction.