SE staff to get GBP3 million car perk compensation Jobs quango

0 Comments | Sunday Herald, The, Mar 1, 2009 | by PAUL HUTCHEON

SCOTLAND'S business quango is to splash out GBP3 million of public money to compensate senior staff for losing a free car perk.Bosses at Scottish Enterprise will pocket lump sums of up to GBP16,000 to soften the blow for having their transport subsidy withdrawn.

They will also be entitled to interestfree loans of GBP5000 to help them buy new cars.

Scottish Enterprise, the country's biggest quango, contributes towards the purchase price of cars for staff who drive more than 4000 miles a year.

The "essential car user" allowance, which benefits 300 staff, is not part of employees' contractual agreement.

However, the perk is to be withdrawn as part of the quango's bid to reduce overhead costs. The senior staff will instead be paid up to GBP16,000 as compensation when the scheme is abolished. The total bill will come to GBP3m, although the quango insists the costs will be recouped within three years.

The compensation scheme is the latest controversy to hit the quango.

Scottish Enterprise's size was slashed after staffing levels were reduced to just over 1000. The cull cost the taxpayer around GBP36m in compensation and pension contributions.

Despite the quango being cut almost in half, Jack Perry, the Scottish Enterprise chief executive, still receives a salary of GBP200,000 a year.

In 2005, a cash crisis resulted in Scottish Enterprise going GBP34m over its GBP500m budget. The p arliament's Enterprise Committee blamed the problems on "incomprehensible" and "wholly dissatisfactory" decision making.

It was also revealed recently that the number of sick days taken by Scottish Enterprise's staff rose by more than 5000 between 2007 and 2008. Figures obtained by the Conservatives revealed that days lost through absence jumped from 11,607 to 17,041.

Margaret Mitchell, a Conservative MSP, said at the time: "Taxpayers are footing the bill for an organisation that offers advice to businesses and new start-ups, but which, on this evidence, clearly has had difficulty running its own affairs."

A spokesperson for Scottish Enterprise said the move was part of a drive for a more environmentally aware organisation: "We are committed to reducing our overhead costs and to adopting a much greener policy on our business travel. Removing the car benefit scheme will help us contribute to both of these areas.

"The cost of the car scheme is currently around GBP1m per annum.

Compensation for the removal of this benefit from the 300 staff affected will cost approximately GBP3m, although this one-off payment will be recouped within three years."

John Park, the Labour MSP, added:

"Compensation at the lowest level of GBP2.4m could be used to create 350 apprenticeships. Ordinary people worried about the current economic climate will find this use of taxpayers' cash unacceptable.

"As for the loans for employees, well there aren't many of us with access to interest-free borrowing. It leaves a nasty taste in the mouth."

John Wilson, the SNP MSP for Central Scotland, said: "I welcome the fact that Scottish Enterprise is to end this allowance. However, it is worrying that it intends to spend GBP3m of taxpayers' money to compensate staff who are losing this allowance. It does not seem like a good use of public money."