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Despite the culling of staff and management across local government, there is still likely to be an annual 30% turnover of chief executives and chief officers. Michael Burton talks to one of the veteran head-hunters about the skills now needed to cope with the downturn. Despite the downturn, demand for skilled chief officers across local government is likely to remain high. This may appear paradoxical at a time when management teams are being reduced and could cause communities secretary, Eric Pickles, to splutter over his cornflakes – but there are three reasons. The first is an expected turnover of 30% a year in top management, caused by a combination of retirements and pension changes. The second is the demand for a different type of top manager, someone who can handle downsizing, a rare experience for those who have known in the past decade only rising levels of spending. And the third is downward pressure on salaries, making the jump from chief officer to chief executive less attractive. As one of the sector's longest-lasting recruitment experts, John Smith has been through public sector recessions before, and agrees turnover at the top will be an issue. ‘There is a significant turnover of top managers due to age, and there'll be a stampede to take advantage of the exit before pension changes,' he says. ‘But I don't believe the job is less attractive. It's just different.' Does he see a drop in salaries as a turn-off for applicants? He replies: ‘The salary is only one part of the job. The key motivator must be the nature of the job to be done. Having said that, I'd see £250-£300,000 for the high-performing chief of a major authority as reasonable, but I don't expect this to percolate down the management hierarchy. I've no problem with high salaries for high-performers, only high salaries for the bone idle and the incompetent. ‘Councils should have the freedom to choose what they want when it comes to pay, as the pool of potential applicants is diminishing.' He believes, however, that the issue of pay-offs such as have occurred recently at London boroughs such as Tower Hamlets, Waltham Forest and Newham needs to be addressed, and adds: ‘Once the personal chemistry between leader and chief executive fails, then the game is up. That's why I'd go for annual contracts. Initially, it might make recruitment more difficult, but that's why we employ consultants. ‘The future will be about annual 12-month rolling contracts with pay-offs of no more than 12 months.' A strong localist, he believes that ultimately, it is up to councils to decide. ‘Doncaster was a basket case, but that's the price of localism. Central government should hold its nerve and let localism run its course, rather than intervene at the first sign of difficulty,' he says. The ebullient Mr Smith was one of the first students at York University in the mid-1960s, where he studied politics and economics, worked briefly in the civil service, then for Saatchi's, after which he started his own consultancy, Succession Planning Associates. During his career there, he placed many senior public sector chief executives. In 2004, the company was acquired by Tribal. Later Mr Smith left and launched a new business, Public Appointments. He has now decided to refocus his consultancy to John Smith & Associates in the light of the changing public sector. He explains: ‘The best time to go into a market is when it's in a downturn. That's when it needs advice and is prepared to take unorthodox advice rather than bland platitudes. I believe there will be a major realignment of consultancies resulting in fewer of them, and I believe we'll be one of those. ‘We have minimised our overheads and, most crucially, all of our nine associates have been chief executives or directors of substantial organisations and understand the practicalities as well as the theories of life at the top.' He also believes that advertising in journals such as The MJ remains an essential part of the mix. ‘In the public sector, one must ensure the post is known to everyone, it has to be all above board. And however good you are, you never quite know if there's someone out there you've missed. Advertising is essential.' Surely, after two decades in the sector and having sold his business, he would prefer to retire? ‘There are only three reasons for retiring – you don't like the job (I love mine), you want to do something totally different such as run a bookshop (I don't), the clients, or one's body gives up (neither in my case, I hope).' He still believes chief executives will need to have a clear understanding of service delivery. He says: ‘I've seen a move from the traditional town clerk with a narrow legal background to someone with a narrow finance background to someone who, whatever their background, really understands service delivery issues which are key to local government – and I don't believe we'll see a move away from that. ‘But then local government managers are better placed and more attuned to service delivery, than the rest of the public sector, especially Whitehall or quangos, where I wouldn't trust a high proportion of top managers to manage a whelk stall – although quite a few of them have the gall to tell local government what to do. ‘The top management talent in local government can hold its own with the top management talent of any sector,' he concludes.

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WHITEHALL

Filling the gap at the top

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