Vancouver Mayor Gregor Robertson and city council have voted to relieve city manager Penny Ballem of her duties. Under the terms of her contract, Ballem will receive a severance of $556,000.

At a news conference on Tuesday, Robertson described Ballem as a force of nature, brilliant and very capable.

"I want to thank her for her amazing service to the city, her commitment to be a public servant to the people of Vancouver," said Robertson, who repeatedly lauded Ballem's work.

"We are so thankful for her contributions and commitment to Vancouver."

Ballem held the top job for seven years and helped oversee the 2010 Winter Olympics, the financial turnaround of the Olympic Village and the recent regulation of illegal marijuana dispensaries.

She's been an extraordinary city manager. That obviously doesn't last forever. - Vancouver Mayor Gregor Robertson

Robertson said council decided to end Ballem's contract at an in camera meeting on Tuesday, hoping to create a whole new leadership team, after recent retirements in the engineering, community and planning services departments gave them an opportunity to make a wholesale change.

"She's been an extraordinary city manager. That obviously doesn't last forever. I realized, we came to a point where we have a good moment for change here...and an opportunity to make that change now more decisively."

He also tied the decision to his promise to "do things differently" after the 2014 election, when his government faced criticism for a perceived lack of transparency and consultation.

Robertson said the city had a challenging year, including a transit referendum and economic growth that has placed pressure on staff to keep up.

Speaking to reporters, Robertson refused to say Ballem had been "fired," stating the term was too "negative," and said he had not asked Ballem to resign, and she had been aware council was considering her position.

The City will now undergo a comprehensive global search for a new city manager which will include a review of the position's compensation. Robertson said he expects the search for a replacement to take up to six months.

In the interim, deputy city manager Sadhu Johnston will serve as acting city manager.

20 months' severance pay

Ballem was hired in 2008 shortly after Robertson's Vision Vancouver party came to power. She served as deputy health minister from 2001 to 2006 in then Liberal leader Gordon Campbell's provincial government.

She quit government without notice and received no severance, publicly criticizing "unsound" organizational changes made to the ministry.

Vancouver Mayor Gregor Robertson

Vancouver Mayor Gregor Robertson said he had not asked Ballem to resign, but she had been aware council were considering her position. (CBC)

By 2014, she was the top earner at the City of Vancouver, with an annual salary of $334,617, according to a financial statement on the city's website.

A copy of her contract, which the city posted online in response to a freedom of information request, shows that she was to be paid $303,958 in 2009, with modifications from time to time in accordance with city policy.

Under Ballem's open-ended contract, council was required to give her 20 months' notice if she were to be relieved of her duties, but Robertson said council decided on Tuesday to give her 20 months' severance pay instead.

"There's so much respect for the work that she did. She has delivered so much for the city. We want to afford her that respect, that honour for giving so much of herself. I think she's been fantastic."

This isn't the first time Vancouver has given a big payout to a departing city manager. Judy Rogers received $572,000 in 2008, when she agreed to resign to make way for Ballem.

At the time, Robertson would only say Rogers was asked to leave because it fit into his new council's "agenda for change."

City Hall left 'rudderless'

George Affleck, a member of the opposition Non-Partisan Association, posted on Twitter that city hall was "rudderless" under the control of Robertson's Vision Vancouver party.

Speaking to the CBC, Affleck said Ballem's departure worries him.

"To me this is mismanagement by Gregor Robertson and Vision Vancouver," said Affleck. "We have to ask ourselves what's wrong? Why are so many senior staff leaving?"

City and politics writer Frances Bula said Ballem was a controversial figure.

"She saw herself as someone whose job it was to carry out council orders... she did that in a very ... effective way," said Bula. "She was a very forceful person who felt she had to be in control of every situation."

Bula said there was speculation before the last election that city hall would ask Ballem to move on.

"I think some people were hesitant about coming to Vancouver [City Hall] because of stories that had been told by other staff as they left about the level of micro management."

According to Bula, Ballen was let go after she refused to step down.

"They presented her with several ways that this could be done, including you know that she would resign and there would be a nice news release about great service. But, you know she chose to push them to the point where they had to take a vote and terminate her contract."

Change welcomed by some

When news of Ballem's departure broke, former Vancouver city planner Brent Toderian, who was let go at the recommendation of Ballem in 2012, issued a tweet simply saying "What goes around, comes around."

Speaking to the CBC later, Toderian, who is now a city planning consultant for cities around the world, reflected that Ballem's departure represented an opportunity to change the culture at city hall.

"It really is almost the entire city-making function that is about to be refreshed. That is both challenging and an incredible opportunity.

"The morale at city hall has not been the best in recent years, so I think this is a chance to get back to Vancouver city hall being an international model."

Ballem did not respond to requests for comment.

With files from Jeff Harrington and The Canadian Press