The former boss of Scotland’s water industry regulator claimed a £400 high-end restaurant meal on an office credit card, with the expense being paid despite failing to provide a receipt, MSPs have heard.
Further details of the lavish spending at the Water Industry Commissioner for Scotland (WICS) were discussed at a Holyrood committee on Thursday.
MSPs were furious as they quizzed officials from WICS and the Scottish Government, saying the extravagant spending at the agency was “unbelievable”.
In December, WICS chief executive officer Alan Sutherland resigned hours after Audit Scotland published a report disclosing “unacceptable” spending.
One of these was the provision of £100 gift vouchers for staff as a Christmas present, which exceeded the £75 limit for gifts.
Another was the funding of a training course at Harvard Business School in the US to the tune of £77,350, including flights, for its chief operating officer Michelle Ashford.
At Holyrood’s Public Audit Committee, MSP Graham Simpson raised the £402.41 meal at the Champany restaurant in Linlithgow, West Lothian, where Mr Sutherland was dining with an official from the New Zealand government in October 2022.
Mr Simpson went through the most expensive items on the menu of the “fine establishment”, saying even the most expensive dishes would amount to a bill of just over £200.
He sought further answers, saying: “Where does the rest come from?”
David Satti, who has recently become the interim accountable officer at WICS, said no itemised receipt had been provided and the expense had been covered on an office credit card, adding: “We have no way of knowing the exact items that were purchased.”
Mr Simpson said: “It’s unbelievable nobody thought to question it.”
He added sarcastically later: “It’s nice work if you can get it.”
Donald MacRae, chair of the board at WICS, said the meal had been wrongly coded as “subsistence” but nevertheless had been “instrumental” in securing income of £1.2 million from New Zealand.
The organisation has 26 staff and had an income of about £5.3 million last year.
WICS is unusual in that 20% of its income comes from international consulting work, Mr MacRae said, stating the public body was seeking to develop this source of revenue.
Addressing MSPs at the start of the meeting, Mr MacRae said there had been a “change of culture and focus on value for money” since the Audit Scotland report.
He accepted that the restaurant bill did not show value for money and new controls had been put in place to prevent similar situations in future.
Mr MacRae later told the committee that Mr Sutherland had been paid six months of his salary in lieu of working his notice period when he resigned at the end of December.
While an exact figure for this was not provided, in 2021 the commission said the chief executive officer’s annual salary was more than £165,000.
Committee convener Richard Leonard was visibly angry as he accused Jon Rathjen, deputy director for water policy at the government, of being “complicit” in the failures at WICS, in that he did not challenge the spending on the £77,000 Harvard course.
Mr Rathjen accepted he “made an error of judgment” in relying on an assurance from the WICS chief executive officer.
He said WICS had approached the Scottish Government to approve the spending retrospectively and refusing it would not have achieved anything.
MSP Willie Coffey said: “I’ve been a member of the Parliament, in the Audit Committee on and off for 17 years, and this is one of the worst sessions I’ve ever participated in.”
Following the meeting, Scottish Liberal Democrat leader Alex Cole-Hamilton said: “When I first heard reports of this spending I was gobsmacked. It sounds as if the commission was spraying public money around like a fire hose.
“Sewage was dumped at least 14,000 times last year, blighting our rivers and beaches. In the face of that scandal we need sober and effective watchdogs that are able to hold the Government-owned water company to account.
“Instead we have a commission which has been dragged before Parliament in embarrassment.”
Mr Simpson later added: “It’s extraordinary that the former CEO who was at the head of the commission when there was a culture of such lavish spending was allowed to leave with six months’ money.
“The attitude to splashing the public’s cash was simply jaw-dropping.”