I have issued this report to draw the public’s attention to a failure in governance arrangements and inadequacies in the processes adopted by Caerphilly County Borough Council to determine the pay of chief officers. As a result of such failures the Council has, in my view, acted unlawfully with regards to this pay-setting process. 

As the appointed auditor it is my responsibility to decide whether it appears to me that any item of account is ‘contrary to law’ before exercising discretion on whether to apply to the court for a declaration to that effect. In the course of my audit investigation, I sought to reach a conclusion on whether the Council lawfully determined the pay levels for chief officers. I have concluded that the decision by the Senior Remuneration Committee (the Committee) on 5 September 2012 to approve the recommended pay structure set out in the Chief Executive’s report to that Committee was unlawful.