The Public Audit Committee (PAC) has published its final report on the Water Industry Commission for Scotland (WICS), following its scrutiny of the water industry regulator’s 2022/23 and 2023/24 audits.
This marks the conclusion of a detailed process initiated by a Section 22 report by the Auditor General for Scotland (AGS) in December 2023, which suggested an inappropriate and unacceptable use of public money. The AGS report highlighted items such as £200-a-head meals, non-itemised and missing receipts, gift cards for staff and a £77,000 Harvard business course for a senior manager. Following the AGS report, Alan Sutherland resigned as Chief Executive of WICS.
The Public Audit Committee’s scrutiny included evidence sessions with current and former WICS employees, representatives of the Scottish Government and Audit Scotland.
The PAC report concludes:
“As a public body and economic regulator of Scottish Water, the Committee considers that WICS has failed to lead by example in respect of ensuring value for money, as evidenced by the significant weaknesses in its governance and financial management arrangements highlighted by the Auditor General for Scotland in his section 22 reports.
“On the basis of the evidence it received, the Committee considers that not one individual or body is responsible for the catalogue of failures that occurred at WICS.
“It is clear that the WICS Board and Audit and Risk Committee, along with the Scottish Government and the former Chief Executive all failed to meet the standards required of them and contributed to an unacceptable use of public funds.”
Since December 2023, WICS says it has taken decisive action to strengthen its governance, financial controls and assurance processes.
This has included a renewed focus on transparency, robust internal oversight and open engagement with both the Scottish Government and the Public Audit Committee.
Ronnie Hinds, Interim Chair of WICS said:
“We accept the Public Audit Committee’s report in full. It reflects issues that we have acknowledged and have been actively addressing since December 2023.
“With direction from our Board and through the commitment of our leadership team and staff, we have taken decisive action to strengthen governance, improve financial controls and embed a culture that is firmly focused on best value.
“We welcome the Committee’s recognition of the steps WICS has already taken, and we are committed to continuing this momentum.
“Everyone at WICS continues to be fully focused on regaining trust and reaffirming our role as an economic regulator that upholds the highest standards, both in our regulatory approach and in our stewardship of public resources.”
The Public Audit Committee’s final report can be read in full here:
