JUNKET SCOTLAND SUNDAYHERALD INVESTIGATION BY PAUL HUTCHEON AND TOM

0 Comments | Sunday Herald, The, Oct 19, 2008 | by PAUL HUTCHEON

BUSINESSES are providing lavish junkets to littleknown but highly- influential staff across swathes of the public sector, a Sunday Herald investigation can reveal.

Senior managers in councils, health boards and quangos are routinely accepting invitations to sporting events, concerts and dinner from firms interested in securing public contracts and money.

Even Audit Scotland, the body responsible for policing the public sector, was found to have accepted a number of foreign jaunts, with staff going on extended trips to the Swiss Alps and Uganda, and frequent visits to Dublin, Paris, Jordan and Moldova.

With recession looming and unemployment soaring, ordinary families across Scotland are tightening their belts and preparing for an economic downturn.

However, hospitality registers obtained under Freedom of Information legislation from Scotland's public bodies suggest the good times always seem to roll for those in the right jobs.

Although there is no accusation of corruption, the registers point to an ingrained culture of accepting hospitality from big business and a lack of consistency between public agencies on how to deal with socialising between senior staff and contractors.

COUNCILS

WITH budgets totalling more than GBP12 billion, it is little wonder Scotland's 32 councils regularly receive invites to junkets from firms looking to win new business or extend existing deals.

However, despite accounting for almost 60per cent of spending, education and social work departments feature little on the hospitality registers, as most of the money is absorbed in staff wages.

Instead, corporate largesse is directed overwhelmingly at senior officials with influence over capital spending, PPP/PFI deals, planning and the management of pension funds.

Up and down the country, well-paid heads of finance, legal, planning, property and IT departments on councils receive the dinners, lunches, golf invitations and tickets to rugby and football matches, rather than the teachers and social workers on the frontline.

In Glasgow, senior officials are regularly entertained by companies with whom the authority does business.

After the council agreed a GBP265 million partnership with Serco to run the council's property and IT services last December, invitations flew in to the chief executive's department for the "Serco Solutions Burns supper", a Serco drinks reception, dinner and drinks with Serco at Glasgow's award-winning Chardon d'Or restaurant, and a Serco party to mark the deal being signed in February.

Other generous hosts include Capgemini, consultants working with the council on procurement and council tax systems, who took senior staff to dinner at Chardon d'Or twice in one week earlier this year. In 2006, the company also handed over tickets to the chief executive's department for an Old Firm game.

Across the central belt, officials at City of Edinburgh Council in charge of the GBP3bn Lothian pension fund receive regular hospitality from would-be fund managers and accountants.

In the last two years, the director of finance has received dinner invitations from Baillie Gifford, Henderson Global Investors, Oppenheimar Capital, Goldman Sachs and Oracle.

In March this year, one dinner and whisky tasting at the Abstract restaurant in Inverness ran to GBP300, courtesy of Henderson Global, which ran the fund's bond portfolio until 2007.

The council's head of fi nancial services has also been wined and dined recently by KPMG, Baillie Gifford, Henderson Global, Butlers, and Zurich Municipal.

After East Ayrshire council signed a deal worth GBP329m over 30 years to build and run seven schools under PPP/PFI in 2005, their staff also got the pampering treatment from the firms whose performance they would need to monitor.

In September 2006, Burness LLP and Atkins, the legal advisers on the deal, took several members of the PPP team to a day of "corporate hospitality" at the Ayr Gold Cup.

The same month, another council official was whisked off to Munich by Hotchieff Construction, which was building the schools, for a two-day briefing on the contract.

To mark the "financial close" of the PPP contract, Nord LB threw a thank-you event for council staff at Chardon d'Or in January 2007.

Those attending included Fiona Lees, the council chief executive, who has also been a regular recipient of hospitality from the drinks giant Diageo, a local employer.

In four of the past five years, she accepted hospitality for herself and her partner at the Johnnie Walker Championship at Gleneagles "to recognise Diageo".

Last year's recognition exercise involved picking up two bottles of Johnnie Walker Black Label, two vouchers for a free round of golf and a pair of jackets.

GOLF is one of the most popular junkets across councils. This year, IT staff in East Lothian have taken up invitations to play at Dalmahoy from Instalec, at Turnberry from Computacenter, and at Gleneagles from Hewlett-Packard.

Last year they managed the same three trips plus a round at Turnberry courtesy of Esteem Systems and six tee times at Duddingston from Cablecom.