Mr Parker stood down from the role following a public outcry over his decision to accept a second role as a non-executive director of UK real-estate trust New River last autumn.
The pay-off was made despite Chief Minister John Le Fondré giving assurances shortly after Mr Parker’s resignation last November that there would be ‘no additional payouts beyond his contractual entitlement’.
However, Mr Parker received the payment as it was deemed less costly than defending any potential claims he might have made against the government following his departure. Government of Jersey accounts for 2020, released this morning, reveal that Mr Parker received the settlement on 29 January, having received an annual salary of £250,000 during the last year of his tenure, topped up by £65,000 in pension payments and other benefits.
In a special report and statement on the matter released alongside the accounts, the comptroller and auditor general, Lynn Pamment, has criticised the procedures surrounding the decision to pay the settlement.
She said: ‘At the time of the compromise agreement, this £500,000 payment to the former chief executive was, in the view of the CAG, in excess of his maximum entitlement under his contract of employment and associated side letter.
‘However, the CAG considers that the actual settlement agreed was reasonable in light of the potential claims that the employer might have faced and the costs of defending them.’
Mrs Pamment added: ‘The circumstances of and processes followed in respect of the severance of the employment of the former chief executive have highlighted a number of weaknesses in policies and procedures in the States of Jersey.
‘Recommendations from previous CAG reports in respect of improved documentation standards for cases leading to compromise agreements and ensuring that reports to and minutes of the SEB include a clear rationale for exit terms proposed and agreed have not been implemented.
‘While I consider that the settlement reached was not unreasonable in the circumstances, I have made a number of recommendations to improve policies and procedures going forwards.’
The CAG also drew attention to a qualified opinion within the independent auditor’s report in the government accounts, pointing out that a requirement within the public-finances manual to consult with the Treasury Department when such payments are made was not met.
States Treasurer Richard Bell said that there had been an ‘oversight’ with regard to doing this within the required timeframe.
Mr Parker stood down as the Island’s most senior civil servant after revelations that he had accepted a secondary role with New River. Despite being given verbal permission to take the directorship by the Chief Minister, Mr Parker failed to secure the written authorisation as he was required to do in his contract.
A statement by the States Employment Board says: ‘The CAG considers that the settlement agreed was reasonable in the light of potential claims that the SEB might have faced and the costs of defending them. The settlement was also within the powers of the SEB.
‘The CAG has made certain recommendations to improve policies and procedures going forwards. These are accepted by the SEB, which recognises that certain deficiencies within existing processes resulted in an instance of technical non-compliance with the public-finances manual.
‘The SEB has provided an explanatory report to the States Assembly.’
Chief Minister John Le Fondré, who chairs the States Employment Board, said: ‘I thank the CAG for her review and welcome her findings that the actual settlement agreed was reasonable in light of the potential claims that the employer might have faced and the costs of defending them.
‘The SEB acted at all times with professional advice, and the CAG has recognised the difficult position that the SEB faced. We will of course ensure that where there are improvements recommended in our policies and procedures, they will be made over the coming months.’
