CONTROVERSIAL extra pay given to council bosses who run the authority's money-making arm are to be scrapped, days after they were revealed by The Press.

Two top bosses at City of York Council have been paid thousands extra a year for working on City of York Trading (CYT), something a new councillor put in charge of the company has said risks a conflict of interest.

Cllr Stuart Rawlings is the new chairman of the board for CYT, a company set up by the last council Labour administration which provides casual staff like care workers and supply teachers to the council.

On Thursday he told the authority's ruling executive the extra payments were wrong and had to stop, and also said the company needed a governance overhaul to make it more transparent.

>>> Original story: Top-up payments come to light

Speaking after the meeting, he said: "Since I started I have been very keen to understand the business better, and although I can see that the officers involved are particularly professional my concerns remain around governance and remuneration packages to council employees."

A Freedom of Information request made by governance campaigner Gwen Swinburn revealed that the council’s director of customer and business support services Ian Floyd was paid £6000 to act as CYT's managing director (MD), while the assistant director for customers and employees Pauline Stutchfield got £3000 for working as the operations director.

It later emerged that those payments could go up if CYT's profits rose.

Cllr Rawlings told Thursday's meeting the decision was taken when CYT was first set up and could not afford a full time MD, but added that two other council staff on the CYT board were not paid extra for their roles.

He added: "This company is extremely well run and the officers involved are incredibly committed. It turned a profit last year of over £300,000.

"I believe it is one of the best things the previous administration did, but I think mistakes were made in the set-up over governance and remuneration."

He went on to say that he believed the council staff had been nothing but committed in their work.

"They have been incredibly professional, but the point is they are getting performance related pay which they could influence from their positions at City of York Council by giving work to CYT.

"I have found nothing to even imply that has taken place, but I am making recommendations to the board."

New governance arrangements will also make sure the Shareholder Committee which approved the extra payments in the first place makes its minutes public in future.