CEO steps down

Water chief quits after lavish expenses revealed

Alan Sutherland: long server

Scotland’s chief water industry regulator has resigned after a watchdog discovered taxpayers’ money was being lavished on alcohol, gift cards and a training course at one of the world’s top business schools.

Alan Sutherland stood down with “immediate effect” from the Water Industry Commission for Scotland – set up to provide value for money for the customer – just hours after Audit Scotland found ‘unacceptable’ use of public funds by senior officials.

WICS had paid £77,350 for its chief operating officer Michelle Ashford, who earns more than £115,000, to attend a training course at Harvard Business School.

Approval for the cost of the course was also only sought afterwards, despite Scottish government approval in advance being required for any service above £20,000.

Auditors also discovered that £2,600 was spent on giving every member of staff at the public sector body £100 Christmas gift vouchers, exceeding the £75 limit for gifts.

Other expenses claims exceeding set rates were submitted and approved without itemised receipts. One claim was for a dinner where the cost per head came to more than £200 per person, with expenses lodged for alcohol purchases.

Within hours of the report’s release the Scottish Government issued a statement saying “that the failings identified in the auditor general’s report are completely unacceptable.”

It added: “WICS’ chief executive is stepping down with immediate effect and has tendered his resignation.

“WICS will now submit an action plan outlining how they will deliver on the auditor general’s recommendations and we will play our part in ensuring that all of the recommendations are implemented without exception.”

Mr Sutherland caused controversy earlier this year when WICS’ accounts showed he had been repaid more than £14,000 for leave he did not take in 2021-22, despite being among one of the highest-paid public sector workers in Scotland on a salary of £183,240.

In its report, Audit Scotland said: “I am concerned that this amount of public money was spent without due process being followed or a clear assessment being undertaken to demonstrate that this expenditure represented value for money.”

Mr Sutherland had been in charge of WICS, which is funded by Scottish Water, since the regulator was created in 2005 and was previously Water Industry Commissioner, a role he took up in 1999.

He was responsible for the merger in 2002 of the three water authorities that were in place at that time and worked with the Scottish Government to develop the regulatory framework.

It was revealed in 2020 that he had taken over 70 flights between 2015 and March that year, with a bill running to £96,000 for business trips to a list of cities including Paris, Milan and Tokyo.

A spokesperson for The Water Industry Commission for Scotland said: “We acknowledge and accept the Auditor General for Scotland’s Section 22 report on our Annual Report and Accounts for 2022/23 and the issues highlighted in the report.

“We take the Auditor General’s findings seriously and will work with Audit Scotland and the Scottish Government to address these. This is a priority for the organisation.

“We are in the process of putting robust and thorough policies and procedures in place and will implement these in conjunction with Audit Scotland and the Scottish Government.”

Scottish Labour deputy leader Jackie Baillie added: “It beggars belief that this body has been frittering away public money with abandon as it hits Scots with one recommended water rate hike after another.

“It is essential that this frivolous spending is reigned in and public finances are treated with respect.”

Scottish Liberal Democrat leader Alex Cole-Hamilton MSP said: “This stinks to high heaven. It is jaw-dropping spending by a body that claims to be a ‘world-leading regulator’ of Scotland’s water and which is supposed to keep Scottish Water in check. The fact that it has been reported to Parliament shows the seriousness of this and why intervention is urgently needed.”

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