Expenditure Scrutiny at Scotland’s Water Regulator

Recent revelations about expense claims submitted by the former chief executive of Scotland’s water regulator, Alan Sutherland, have raised significant concerns about financial oversight within the organization. A review commissioned by the Scottish government has unveiled questionable spending practices that include luxury items and extravagant travel costs.

Questionable Spending Practices

The review, conducted by consultants Ernst & Young, examined expenses between October 2018 and June 2023. Among the findings were claims for items like a £170 Mulberry wallet and £290 glasses, which lacked any clear business justification. Furthermore, Sutherland authorized a business class flight to New Zealand costing over £18,000 for a director and her partner.

The report highlighted that while both individuals resided in New Zealand at the time of travel, it is uncommon for organizations to cover business class fares for spouses. There was no documented consideration of whether these expenses were appropriate or provided value for money.

In total, Sutherland submitted 28 bulk uploads of expenses during his tenure, with amounts ranging significantly from £190 to over £21,329. This level of spending prompted a broader examination of governance practices at the Water Industry Commission for Scotland (Wics), especially following an earlier Audit Scotland report that disclosed lavish expenditures such as an £80,000 course at Harvard Business School for a senior manager.

Governance Concerns and Future Actions

The review concluded that there was a “poor control and governance environment” within Wics. It noted inconsistencies in how working-from-home expenses were claimed, with allowances varying dramatically between £100 and £600 for desks. Additionally, many staff members expressed dissatisfaction with the organization’s hierarchical structure, feeling their voices were not heard.

In response to these troubling findings, Acting Net Zero Secretary Gillian Martin emphasized the government’s commitment to responsible public spending. She mentioned an interim chairperson’s appointment to oversee necessary changes and confirmed ongoing monitoring of an action plan aimed at reforming Wics' culture.

Conservative net zero spokesperson Douglas Lumsden called for a decisive end to what he termed a culture of excessive spending within Wics, urging accountability to taxpayers who might be outraged by such fiscal practices.

As scrutiny intensifies around public sector expenditures in Scotland, the future direction of Wics will depend on its ability to restore trust and implement effective governance reforms. Ensuring transparency and accountability in public spending will remain paramount as stakeholders await tangible improvements in organizational practices.