Water body chief resigns over £77k Harvard expenses row

Alan Sutherland has quit as chief executive of the Water Industry Commission for Scotland

The chief executive of the public body regulating Scottish Water has quit after it was accused of "poor governance" with public funds.

The Water Industry Commission for Scotland (WICS) spent more than £77,000 on a course for a senior executive at Harvard Business School in the US.

A further £2,600 was claimed to provide every staff member with a £100 gift card for Christmas.

Chief executive Alan Sutherland will leave his role with immediate effect.

The report by the Auditor General stated that the "financial management and governance issues found at the commission fall far short of what is expected of a public body".

The Water Industry Commission for Scotland said: "We take the Auditor General's findings seriously and will work with Audit Scotland and the Scottish government to address these."

The Scottish government, which had approved the expenses retrospectively, said the failings were "completely unacceptable".

Harvard is one of the world's most prestigious universities

A government spokesman added: "The Water Industry Commission for Scotland's 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."

Further findings in the audit showed that the cost per head claimed for a dinner, attended by Mr Sutherland, exceeded £200 per person - despite the approved non-city limit being set at £25.

It also noted an "unusual" policy where claiming alcohol on expenses was allowed.

A total of £77,350 was claimed for the Harvard Business School course attended by chief operating officer Michelle Ashford, which included flights to Boston.

Stephen Boyle was critical of the Water Industry Commission for Scotland

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

Stephen Boyle, Auditor General for Scotland, said: "Value for money should always be central to public bodies' spending decisions, but these findings highlight unacceptable behaviour by senior commission officials in the use of public funds.

"I expect appropriate action to be taken to address the issues reported by the auditor."

'Insufficient discussion'

The commission's annual report for 2022/2023 previously stated that: "The Accountable Officer is taking action to address the weaknesses that led to the oversight of appropriate approval."

The body employs 26 people and it has a statutory duty to promote the interests of Scottish Water's customers.

It is funded via a levy on Scottish Water.

The report said that management had accepted the auditor's findings and that there had been "insufficient discussion" of expenses.

It added that the commission intend to revise their expenses policy and provide further training for both management and staff.

'Shocking culture'

Earlier this year it emerged that Mr Sutherland had been given a £14,000 payment for some annual leave he did not use.

Scottish Labour deputy leader Jackie Baillie said the report showed a "shocking culture of financial mismanagement".

She 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."

Scottish Liberal Democrat leader Alex Cole-Hamilton called the figures "jaw-dropping".

And Scottish Conservative net zero, energy and transport spokesman Douglas Lumsden said: "The staggering amount of public money poured down the drain by the Water Industry Commission for Scotland - a body set up to ensure value for customers - is indefensible."

The Water Industry Commission for Scotland said it was dealing with the issues highlighted in the report "as a priority".

A spokesperson said: "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."