DUDLEY’S new chief executive is set to collect an £8k pay rise despite the council planning a budget bloodbath.

The authority has announced the appointment of 52-year-old Sarah Norman as replacement for the council’s senior officer John Polychronakis.

Mr Polychronakis, who trousers £157,000 per year, is to retire and will be replaced by Ms Norman in the new year. She has been tempted to Dudley by a bank-busting annual salary of £165,000.

The appointment was announced on the same afternoon the council published its latest three-year financial plan which paints a bleak picture of cost cutting and up to 300 job losses.

Councillor Stuart Turner, Dudley cabinet member for finance, said: “The significant cuts in government funding have made setting a budget with the required savings more and more difficult.

“We can reassure every Dudley borough resident that we will be as innovative as possible to look at every option of finding the savings in order to protect key services. We can also assure our staff that we will continue to work tirelessly to minimise the need for compulsory redundancies.”

Council leaders, who are currently planning a senior management restructure which will cut the number of top jobs but offer higher wages for senior executives, say the authority has to pay big money to attract the right calibre of candidates for top jobs.

Cllr David Sparks, leader of Labour-run Dudley Council, said: “I am delighted to be able to welcome Sarah to the authority and look forward to working with her to drive through fundamental change.

“These are challenging times for any local authority, but I believe this appointment will help keep us ahead of the curve and take us from a good local authority to a national leader in local government.”

A report on council finances which proposes savings of £22.9m in 2015/16 will be debated by the authority’s cabinet on Wednesday October 29.

The report contains shocking details of how a review by council officers in the Children’s Services department which originally predicted a £7m saving has had to be amended to forecast a £1m overspend.

The review, which was completed in July, claimed the number of looked after children in their care would reduce by a third over the next three years.

However the directorate has now admitted the review was wrong and demand is increasing, especially in the high-cost category of youngsters in need of residential or foster placements, and savings have been taken out of their predictions to be replaced by an additional £1m cost – which they say may increase further.

The report recommends senior managers are “reminded of the need for strict budgetary control in accordance with the Financial Management Regime.”

Cllr Mike Wood, Dudley’s Conservative opposition spokesman on finance questioned Labour’s ability to control spending. He said: “Council tax payers are bearing the financial cost of their failure to get a grip on Children’s Services.”