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Official Report: search what was said in Parliament

The Official Report is a written record of public meetings of the Parliament and committees.  

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Dates of parliamentary sessions
  1. Session 1: 12 May 1999 to 31 March 2003
  2. Session 2: 7 May 2003 to 2 April 2007
  3. Session 3: 9 May 2007 to 22 March 2011
  4. Session 4: 11 May 2011 to 23 March 2016
  5. Session 5: 12 May 2016 to 4 May 2021
  6. Current session: 13 May 2021 to 18 February 2026
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Displaying 3760 contributions

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Public Audit Committee [Draft]

Section 22 Report: “The 2024/25 audit of the Scottish Government Consolidated Accounts”, and “Financial sustainability and taxes”

Meeting date: 4 February 2026

Richard Leonard

Thank you very much for that clarity. You will be aware that we have a second public evidence session this morning on Historic Environment Scotland, which has been the subject of a section 22 report by Audit Scotland. We have also carried out an inquiry into the Water Industry Commission for Scotland over the past year or so. Following the unearthing of issues through that investigation and the identification of issues through the audit, we were told by the cabinet secretary last year that the Scottish Government was planning “deep dives” into all parts of the public sector to review risks and that an examination was being conducted to make sure that the behaviours and practices that we had seen in WICS were not being replicated elsewhere in the public sector. Did that deep dive include Historic Environment Scotland?

Public Audit Committee [Draft]

Section 22 Report: “The 2024/25 audit of the Scottish Government Consolidated Accounts”, and “Financial sustainability and taxes”

Meeting date: 4 February 2026

Richard Leonard

I will finish my series of questions by going back to the evidence that the committee took on 14 January from the Auditor General, who again pointed out that

“It is the responsibility of the permanent secretary, as the principal accountable officer of the Scottish Administration, to appoint the accountable officers of public bodies … We have seen a lack of clarity in why the Scottish Government chose not to appoint an accountable officer”.—[Official Report, Public Audit Committee, 14 January 2026; c 9.]

How would you respond to that?

Public Audit Committee [Draft]

Section 22 Report: “The 2024/25 audit of the Scottish Government Consolidated Accounts”, and “Financial sustainability and taxes”

Meeting date: 4 February 2026

Richard Leonard

Jackie McAllister, you are the chief financial officer for the Scottish Government, and you have just told us that the amount of funds that could have been recovered by this individual was at such a level that it warranted paying them, for a 10-month period, almost a quarter of a million pounds. Is that really how the Scottish Government views these things?

Public Audit Committee [Draft]

Section 22 Report: “The 2024/25 audit of the Scottish Government Consolidated Accounts”, and “Financial sustainability and taxes”

Meeting date: 4 February 2026

Richard Leonard

So this situation could, presumably, be replicated in all kinds of organisations. My reading of the public finance manual is that you, as the principal accountable officer and permanent secretary of the Scottish Government, should step in in these situations to ensure that an accountable officer is in place. You take a different view, presumably.

09:45

Public Audit Committee [Draft]

Section 22 Report: “The 2024/25 audit of the Scottish Government Consolidated Accounts”, and “Financial sustainability and taxes”

Meeting date: 4 February 2026

Richard Leonard

Okay, but the Public Audit Committee has seen lots of examples of the CEO of an organisation no longer being in post. For example, Mr Irwin, the CEO of Ferguson Marine was not the accountable officer; other people were designated that role. The accountable officer does not need to be the CEO and, presumably, if the CEO is off, someone else in the organisation should be appointed to the post.

I will move on to the GFG Alliance. In the next few weeks, the committee will be taking evidence from representatives of the GFG Alliance, because we have a long-standing concern about the risk that the Scottish Government is exposed to as a result of its arrangements with the GFG Alliance. As a reminder, I note that that company is facing litigation from Companies House for failing to lodge accounts and is facing investigation by the Serious Fraud Office for fraudulent trading, money laundering and suspected fraud. The company’s auditors have walked out and, just this week, we read that Liberty Steel, which is part of the GFG group and operates the Dalzell plate mill in Motherwell, is not securing Ministry of Defence orders because of cash-flow issues.

What do you understand the level of risk to be from your arrangements with the GFG Alliance?

Public Audit Committee [Draft]

Section 22 Report: “The 2024/25 audit of the Scottish Government Consolidated Accounts”, and “Financial sustainability and taxes”

Meeting date: 4 February 2026

Richard Leonard

Do you not accept the Auditor General’s view that it is a significant gap that the company has not lodged accounts, does not have auditors and is under investigation by the Serious Fraud Office? Are you seriously suggesting that that is the kind of company that you want to be dealing with?

Public Audit Committee [Draft]

Section 22 Report: “The 2024/25 audit of the Scottish Government Consolidated Accounts”, and “Financial sustainability and taxes”

Meeting date: 4 February 2026

Richard Leonard

But it has not done that for years, Mr Irwin.

Public Audit Committee [Draft]

Section 22 Report: “The 2024/25 audit of the Scottish Government Consolidated Accounts”, and “Financial sustainability and taxes”

Meeting date: 4 February 2026

Richard Leonard

So that is how it works. I just find it incredible that that is how the Scottish Government does its business.

You said, permanent secretary, that you were going to have a look at what the Auditor General said. What he told us was that he felt that approval for that kind of case should be made not at deputy director general level, but at director general level, or even at cabinet secretary level. What is your view on that?

Public Audit Committee [Draft]

Section 22 Report: “The 2024/25 audit of the Scottish Government Consolidated Accounts”, and “Financial sustainability and taxes”

Meeting date: 4 February 2026

Richard Leonard

Okay, but—

Public Audit Committee [Draft]

Section 22 Report: “The 2024/25 audit of the Scottish Government Consolidated Accounts”, and “Financial sustainability and taxes”

Meeting date: 4 February 2026

Richard Leonard

Mr Smith from Audit Scotland told us that it was “an extreme case”, and the Auditor General told us that he did not think that there was

“sufficient oversight of the arrangement”.—[Official Report, Public Audit Committee, 17 December 2025; c 8.]

That is something for you to consider, permanent secretary.