MSPs: Hefty Public Sector Payouts Rewarding Failure
9 October 2017, 06:25
A Holyrood committee has called for an end to "hefty" payouts to public sector leaders who leave after causing problems in their organisation.
MSPs on the Scottish Parliament's Public Audit Committee have raised concerns about the practice with Finance Secretary Derek Mackay, claiming that severance payments in such a situation are essentially "rewarding failure".
The committee wrote to Mr Mackay after reports by the Auditor General for Scotland highlighted various financial and governance concerns in public bodies.
MSPs said there were "some instances where individuals who may have been at least partly responsible for a performance issue at a public body were no longer in post" by the time they came to consider the public spending watchdog's report.
This had "created some frustration about whether such individuals have been satisfactorily held to account," the committee told Mr Mackay.
They also said the situation "raises questions about how they are recompensed" and with the Government consulting on severance policy for the public sector, they made clear that "in the circumstances we have described, the award of an agreement should be very carefully considered by the body in question".
Acting convener Jackie Baillie said: "We are concerned that some of those responsible for creating major problems within public bodies may be leaving without being held to account for the issues they may have caused.
"What's worse is that some of these individuals could leave with a hefty pay-off in their pockets, which is essentially rewarding failure and is understandably frustrating for the Scottish public who pay for these public services.
"That's why we've written to the Cabinet Secretary to highlight the problem, which is common to many organisations, and to ensure that the Scottish Government puts an end to rewarding failure as part of its severance policy for Scotland."
A Scottish Government spokesman said: "The Scottish Public Finance Manual provides guidance on settlement agreements, severance, early retirement and redundancy, making clear that financial compensation should only be offered on a value for money basis with issues of propriety and regularity fully examined."