Eric Pickles condemns 'under-the counter pay-offs' as £14m bill for gagging orders for 5,000 axed civil servants is revealed

Eric Pickles, the Communities Secretary, today warned council chiefs not to resort to “under-the-counter pay-offs” to buy the silence of departing staff after it emerged nearly that up to 5,000 public servants have been granted severance payments in recent years, many involving gagging orders.

According to freedom of information replies, more than 200 staff in Whitehall and 4,562 in local authorities had signed “compromise agreements”. The sums involved could be more than £400,000 for senior employees.

The Daily Telegraph puts the total cost of Whitehall severance payouts at £14m.

The figures emerged a month after the Health Secretary, Jeremy Hunt, outlawed the use of gagging orders which prevented NHS staff raising the alarm about poor patient care.

According to the Freedom of Information survey, 256 councils signed 4,562 compromise agreements with former staff between 2005 and 2010, most of which are understood to have included “gagging orders”.

The number of confidentially agreements issued by councils soared from 179 in 2005 to 1,027 in 2010. Brighton & Hove City Council signed the most, with 123 agreements with former staff.

In central government, the Department for Business, Innovation and Skills has signed the agreements with 83 officials over the past two years, at a cost of £2.6 million.

The Treasury has signed agreements with 64 individuals at a cost of £2.5m, although only a “small number” involved confidentiality agreements.

The Department for Transport signed 40 agreements in the past three years, all of which contain confidentiality clauses.

The Department for Energy and Climate Change signed 12 agreements containing confidentiality clauses at a total cost of £1.5m, the Ministry of Justice signed 15 at a cost of £250,000, while the Foreign Office spent £5.5m on compensation agreements.

Mr Pickles claimed new checks and balances would help stop gagging orders being abused.

He said: “For too long local government has made departing staff sign gagging orders, often with big pay-offs attached, away from the eyes of those who get left with the bill: the taxpayer.

“When leaving a job, councils and their employees need to part ways fairly. Giving out thousands in under-the-counter pay-offs to silence departing staff is not the way to achieve this.

“Councils have a responsibility to the public and transparency is at the heart of that. By shining a light on these activities and introducing new democratic checks and balances to stop gagging orders being abused we are helping councils improve accountability in local government.”

The FOI requests were submitted by Paul Cardin, a former lighting engineer at Cheshire West and Chester Council. He was prohibited from even making FOI requests under the terms of his compromise agreement.