All Members of the National Assembly for Wales

18 December2015

Dear All,

I have had the pleasure of meeting many of you over the last few months. My new colleagues on the Remuneration Board have also had the opportunity to meet some of you to learn more about your roles in the Assembly. We are grateful for the warm welcome we have received and look forward to working with you over the coming months.

Our first formal meeting was held on 10 December. We considered our work programme for the coming year, our ways of working and reached decisions on some important matters.

Before the start of the next Assembly, we need to decide the levels of AMSS pay and the allowances for Office Costs and Residential Accommodation. We are conscious that we have very little time to undertake any detailed review of these important matters.  We are also aware of the work undertaken by the previous Board in recent years and so we are comfortable that we can return to consider these in more detail if necessary following the Assembly elections.

The following is a summary of our discussion and decisions.

Assembly Member salaries

After considerable research and deliberation, the previous Board set the basic salary for Members, and additional salaries for office holders, which will be paid in the next Assembly. We reflected on whether the current flexibility, which allows Members to decline a part of their salary entitlement, should continue.

We are firmly of the view that Members should be paid the appropriate remuneration to reflect the complexity and importance of the role. This is also consistent with our duty not to deter, on financial grounds, persons with the necessary commitment and ability from seeking election.

We agreed, therefore, that Members in the Fifth Assembly will be paid their base salary, and any additional office holder salary applicable, in full.

Having received the salary, of course, it is a matter for each individual Member how they choose to use it.  Members’ Business Support can provide advice and guidance should any Member wish to participate in the Assembly’s payroll giving scheme or other such options.

We will be writing to the Assembly Commission to inform them of our decision so that Members’ Business Support can reflect this in its arrangements and advice to Members.

Fifth Assembly Determination

Assembly Member Support Staff salaries 2016-17

The Board considered the broader context of pay across the UK in the public and private sectors. Private sector employees on average are continuing to experience real wage growth as changes in median pay remains above inflation; in the year to September 2015, RPI growth was 0.8% and CPI -0.1%. The public sector is still subject to ongoing UK Government pay restraint of 1% for the next four years.

Last year the Board proposed that the latest available Welsh annual median earnings for full-time staff (as measured by the Annual Survey of Hours and Earnings) should be used to uprate AMSS and AM salaries. We agreed that this was the most suitable index for determining an appropriate pay increase for 2016-17.

The provisional ASHE figures for 2015 were released in November 2015 at 1.1%, revised figures are not expected until November 2016.

Therefore, we are proposing to increase AMSS salaries for 2016-17 by 1.1% in line with the provisional 2015 figures for ASHE median earnings in Wales

Please let us have any responses to the proposed increase by the 12 February 2016 to inform our deliberations at our following meeting.

Qualifying threshold for AMSS sick pay

As part of the review of AMSS terms and conditions started under the previous Board, we were invited to consider the outstanding issue of whether to introduce a qualifying period before AMSS sick pay is paid.

Currently there is no qualifying period for sickness pay:

· Sick pay entitlement starts at day one

· Staff are entitled to six months full pay and six months half pay in a four year period.

We considered representations from support staff and from their Trade Union representatives. We also noted the limited information available on reporting of AMSS sickness absence. This is regrettable as it makes it difficult to assess the impact of any policy change. More importantly, it may suggest that basic good practice in the management of staff is not followed consistently across Members’ offices.

We agreed that it would not be appropriate to introduce a qualifying threshold for sick pay at this time.

Office costsfor 2016-17

The Board considered the office costs allowance and whether it remains appropriate for the financial year 2016-17. The Board considered a number of factors, including office rental costs across Wales and inflation: the latest estimate expected at the end of 2015-16 is CPI growth of 1.0% and RPI 1.9%.

We are proposing to increase the office costs allowance by 1% or by the change in the CPI in the year to April 2016, whichever is greater.

Please let us have any responses to the proposed increase by the 12 February 2016.

Residential Allowancesfor 2016-17

The Board took a first look at whether the Residential Allowance for Members should be revised. We will consider it further at our meeting in January, when we will consult on our proposal.

We would like to have further information on whether any Members’ rental agreements include annual index-linked or percentage uplifts to help us assess what might be an appropriate approach to reviewing the residential allowance from year to year. Members’ Business Support will be approaching Members who have rental agreements to request this information over the coming weeks.

New Pension Scheme – May 2016

The Board’s legal advisers have confirmed that to allow future service to count for   the rule of 80, as was proposed by the previous Board, would fail to meet requirements in age discrimination legislation. This agrees with the legal advice received by the Trustees of the Scheme.

To address these concerns, we have decided, that future service after 6 May 2016 will not count as qualifying service for the Rule of 80.

We will be contacting those who will be affected by this decision directly to explain the implications to them.

At our meeting we also received an update from the Pensions Team, setting out their approach to implementing the new Members’ Pension Scheme over the coming twelve months and communicating the changes to Members.

Advice on pensions in the Fifth Assembly can be provided by Donna Davies, Head of Pensions on 0300 200 6523and Donna.Davies@assembly.wales

To end

I hope you have found this update useful. The intention is to make this letter publicly available through our website once Members have had a chance to read it. Should you have any feedback on any of the matters above, please do not hesitate to contact me.  

I am always happy to meet individual Members. I intend to continue to hold regular drop-in sessions during Plenary meetings and to meet the AM and AMSS Representative Groups. If you would like to discuss anything with me, please contact the Board’s new clerk Gwion Evans on remuneration@assembly.wales to make arrangements (extension no. 7403). 

I wish you a happy, restful Christmas break.

Best Wishes,

Dame Dawn Primarolo

Cadeirydd / Chair

Bwrdd Taliadau/Remuneration Board