Taxpayers’ Union calls for an end to “golden goodbyes” in the public sector

Lobby group says New Zealand should wave goodbye to the "golden goodbye"

Lobby group the Taxpayers’ Union is calling for John Key to follow British Prime Minister David Cameron’s pledge to stop taxpayer funded golden handshakes.   

Earlier this week, the Conservative party in Britain promised to ban the controversial “golden goodbye” in the public sector if re-elected in May.

The commitment will see payouts capped at £95,000 each in the National Health Service, the civil service, council staff and even the BBC.  

The election promise comes after a number of high profile controversial payouts which were funded by the British taxpayer; including pay-outs of more than £500,000 in the NHS.

The New Zealand Taxpayers’ Union agrees with Mr Cameron’s lead and the group’s spokesman, Ben Craven, is calling for New Zealand to adopt a similar system.

Mr Craven says New Zealand mirrors the UK's culture of taxpayer funded golden handshakes. 

"UK Prime Minister David Cameron has pledged to stop the big payouts – our prime minister should follow suit.”

He says severance payments are usually made to payout underperforming executives to avoid messy employment disputes.

The Roger Sutton saga in November last year drew debate over public sector payouts.

Labour Leader Andrew Little criticised the decision to grant Mr Sutton a severance payout.

Although the value of the severance package was never publically announced, NBR revealed Mr Sutton may receive $1 million or more for the period of employment he foregoes. (The life span of CERA is undetermined but generally expected to come to an end around 2016-17 after being set up in 2011. This suggests Mr Sutton may receive $1 million or more for the period of employment he foregoes.)

Taxpayers’ Union executive director Jordan Williams’ response to the Sutton saga was to call for Labour Minister Michael Woodhouse to step up and amend employment law to prevent more taxpayer funded golden handshakes.

“Regardless of whether Mr Sutton is guilty of wrongdoing, he’s telling the public that he resigned off his own back. That shouldn’t come with a cheque."

Mr Craven says it is time for a bi-partisan consensus that the lavish golden handshakes provided to chief bureaucrats are excessive.

“The easiest way to fix the problem would be to prevent the top 1% of income earners relying on the unfair dismissal laws intended for those much lower in the pecking order.

“It is ludicrous that severance payments have morphed into lavish golden handshakes, with taxpayers footing the bill.”

Jwalls@nbr.co.nz

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