Why quango gravy train is Scotland’s shame

So we have one small regulatory quango to keep an eye on one publicly owned water company. What could possibly go wrong? Well, quite a lot as has become apparent. By comparison to the WICS quango, Fred Karno’s Circus was a model of good order.

That had scarcely been Scotland’s best-kept secret but it came into public view last December when the Auditor General  produced an excoriating review of WICS’s activities including “unacceptable behaviour by senior commission officials in the use of public funds”.

Unauthorised international travel, lavish dinners in expensive restaurants and funding MBAs in America at up to £88,000 a time emerged on the charge sheet. Oversight of these practices appeared to be non-existent. The chief executive, Alan Sutherland, resigned on six months’ pay.

The chief operating officer claimed that under Mr Sutherland’s leadership, there had been a "toxic environment that caused staff to create dysfunctional coping mechanisms in order to survive". Nobody on the WICS board seems to have noticed. But why would they? As we will see, they are busy people.

Since then, the Public Audit Committee – one of Holyrood’s better institutions – has been pursuing an inquiry into how the organisation could have gone so far off track. On Thursday, 103 pages of heavily redacted correspondence from WICS landed on the Scottish Parliament web-site to shed some light.

This included a report commissioned by the WICS board from Grant Thornton which, at one level, makes colourful reading. The “unauthorised use of credit cards”, the £6,700 flight to Brasilia and £4,600 to Rwanda, the £1,100 dinner at Gaucho… life at WICS may have been toxic but it was never dull.

In the great scheme of things, the money involved was not enormous – hardly the cost of a gangway in Scottish Government currency – and the party is now officially over. The residual lessons should not just be about WICS, which will presumably be on its best behaviour, but the whole quango set-up.

Even more interesting correspondence went unnoticed, shortly after Holyrood went into recess when the Scottish Government’s “director general of net zero”, Roy Brannan, responded to searching questions from the Public Audit Committee. It emerged that even the way Mr Sutherland was paid off attracted the “extreme concerns” of the minister as WICS had “not complied” with the Scottish Public Finance Manual rules.

Mr Brannan – formerly head of Transport Scotland, incidentally – had some extraordinary words about the governance of WICS. The role of the “WICS board chair and members, the skills development of the board, the values they espouse and the leadership role modelling to foster a culture of openness, transparency and ensuring best value” were all in question.

The ”culture and ethos” the WICS board presided over were to be assessed and, for good measure, there was to be a “review of WICS leadership... with regard to integrity, decision-making, risk and control”. Phew!

So who were these non-executive board members who had allowed this to happen on their watch? Novices, perhaps, more knowledgeable about water than the governance of a small public organisation? Not a bit of it. Step forward the chairman, Donald Macrae, and Ann Allan, another multi-quangoteer who featured in dispatches.

Both are archetypes of the Scottish quango system. Once you’re in, you’ll never be out, if you keep your head down to the satisfaction of the civil servants. Mr Macrae, a former banker, has been on the circuit for years – Scottish Homes, Scottish Enterprise, deputy chair of Highlands and Islands Enterprise as well as chairing WICS.

With that pedigree in quangoland, it must be a little humiliating to learn via a civil servant’s letter you are in need of “skills development” and assessed for “integrity, decision-making, risk and control”. 

Ms Allen is even busier. She has a full-time job at Leeds University and lives near Harrogate but has managed to chalk up five quango appointments in the gift of Scottish ministers – chair of Architecture and Design Scotland, the Scottish Futures Trust, the National Museums of Scotland, Crown Estate Scotland and, of course, WICS. 

Within the past few weeks, with all this going on at WICS and in spite of the “reviews” and “assessments” promised by Mr Brannan,  Ms Allen was re-appointed to the board of Crown Estate Scotland, which is itself in need of searching questions about how the ScotWind leases were flogged off at bargain basement prices.

The whole quango system in Scotland is long overdue for political attention. It was seen at its most grotesque recently when, in straightforward defiance of demands for governance reform at CalMac and CMAL, the Transport Secretary, Fiona Hyslop, re-appointed the Copenhagen-based chairman of CalMac and two non-executive directors who, by their own admission, have never visited a CalMac port. 

This made them eminently suitable in the eyes of civil servants who run the quango system for ministers to rubber-stamp. Instead of being points of challenge based on knowledge and insight, Scotland’s leading public bodies have been reduced to cyphers where silence is the key to long careers on the circuit.

The WICS car crash was wholly predictable. So too is the utter disconnect between ferry policies and the unrepresented people at the sharp end of them. The system ensures that large areas of public policy are run without meaningful accountability or challenge.

Believe it or not, this is not mainly a party issue because it has been going on for so long. In SNP hands, however, it has become a control mechanism to ensure acquiescence. It is long past time for root and branch reform.