Auckland Council's development agency has scrapped a bonus scheme that paid out $450,000 to staff last year.

Panuku Development Auckland executives drew up a bonus scheme that was approved by the unelected board in 2017, but it came under scrutiny when the Herald revealed former chief executive Roger MacDonald was paid a bonus of $82,500 last year.

Thirty eight staff were paid bonuses at Panuku last year. Last June the board reviewed the scheme and agreed to maintain it for a year to maintain competitive with the marketplace, board chairman Adrienne Young-Cooper said at the time.

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Today, Young-Cooper said the board had decided to discontinue the performance incentive scheme to the executive leadership and staff. Payments will not be made from this financial year, she said.

"The decision is based on recommendations from Panuku's executive leadership team. We appreciate that there is significant interest in public sector pay and this always needs to be considered.

"Recognising great performance remains an important part of Panuku's culture. We will continue to link salary increases to performance and the executive leadership team will be working with staff to develop a new recognition programme," Young Cooper said.

Former Panuku chief executive Roger MacDonald was paid a bonus of $82,500 last year. Photo / Supplied
Former Panuku chief executive Roger MacDonald was paid a bonus of $82,500 last year. Photo / Supplied

Two other council bodies, Watercare and Auckland Tourism, Events and Economic Development(Ateed), operate bonus schemes and one executive at Regional Facilities Auckland receives a bonus based on an old employment contract. Last year, the executive was paid a bonus of $15,000.

Auckland Council and Auckland Transport - the two largest council bodies - do not pay bonuses.

Auckland mayor Phil Goff, who last October called for a stop to bonuses being paid to council-controlled organisation staff, said:

"I am on record as opposing a bonus system within Panuku, which is a public not a private sector organisation. I am pleased that they have discontinued it. Executive pay levels will be salary-based in accordance with their skills and experience."