Local authorities have also been urged to come clean with the public when senior figures leave with substantial pay-offs.
The Communities and Local Government Committee found that while senior council staff had seen pay grow by 75 per cent in the 2010s those increases had been curbed as public spending cuts hit.
Committee chairman Clive Betts, the Sheffield South-East MP, said: “It is unacceptable for senior figures to be handed significant increases simply for doing their jobs and we welcome the pay restraint the vast majority of councils are now demonstrating.
“However, as economic conditions improve, councils need to strengthen local control of pay by developing more robust powers for democratic scrutiny.”
Mr Betts added: “We’ve all seen cases where an underperforming council chief appears to be pocketing a substantial pay-off as an incentive to leave – the public are rightly concerned at senior council staff being rewarded for failure. We call on Government to require councils publish details of any redundancy or ex-gratia payments made to departing senior staff within a month of the decision to award it.“
In evidence to the committee, Yorkshire councils said there had been a significant fall in the number of senior officers employed in recent years with chief officers taking on more responsibility without additional pay.
They said performance-related pay was not common in the region’s local authorities and there had been no national pay increase for chief officers in five years against a backdrop of rising inflation and pension contributions eating into take-home pay.
In a separate report, the Public Accounts of MPs expressed concern that insufficient scrutiny is being given to council spending.
Chairwoman Margaret Hodge MP said: “The Government believes that the best way to ensure that councils spend our money wisely is to rely on local residents and councillors to provide scrutiny.
“However, there is no convincing evidence that ‘armchair auditor’ members of the public are being empowered to hold local authorities to account for how they spend the £36.1bn in funding they receive every year.
“Councillors do not always have the skills or time to fulfil this role, which involves scrutinising the delivery of complex services such as adult social care provision.”
The committee called for councillors and the public to have access to “relevant and comprehensible information”.