Citizens' champion blackballed by Mandelson quits after only a week

A FORMER college head who quit following an investigation into a £20 million funding shortfall has lasted just a week in his new high-profile job leading Scotland's Citizens Advice Bureau.

Howard McKenzie, who was principal of Jewel and Esk College, took up the 60,000-a-year position as chief executive of Edinburgh-based Citizens Advice Scotland (Cas) just seven days ago.

He resigned yesterday after Lord Mandelson's Department for Business, Innovation and Skills (Bis), which funds Cas, confirmed it "did not choose to appoint him and were not in the position to accept him as accounting officer".

The 54-year-old resigned from his college job last April after an investigation into the massive funding shortfall. The college insisted the resignation and the investigation were not linked.

Earlier this month Cas announced the appointment of Mr McKenzie. As chief executive, his duties would have included handling government grants which make up a substantial proportion of the organisation's funding. However, the appointment has now been blocked by the Department for Business.

A spokesman said: "The accounting officer must ensure annual grant-in-aid given to Cas is used properly and for the purposes for which it is given.

"He or she will be accountable to Bis and parliament for that aid. In this particular case, the department felt it could not make the appointment."

Mr McKenzie had already been quoted on the Cas official website saying he was "absolutely thrilled to have been appointed".

Yesterday Mr McKenzie said that he would now be focusing on running his independent management and consultancy business, Howard McKenzie Scotland Ltd, which he set up in September.

He said: "I've picked up a lot of clients recently and I want to focus on them. The job with Cas had not been entirely finalised. I was being trained in the office this week, but had not signed a contract."

Director of Cas, Dominic Notarangelo, confirmed that Mr McKenzie had resigned from the CEO position.

He said: "We have received a letter of resignation from Howard. We will discuss appointing a new CEO next month."

As principal and chief executive of Jewel & Esk College, which has campuses in Edinburgh and Dalkeith, Mr McKenzie was involved in a 55m redevelopment of the institution.

The college's finances were the subject of concern and auditors were called in.

A draft report is understood to have identified a 20m funding shortfall, which was due to a proposed land deal being put on the back-burner.