Fury over £2m bonus pot for quango chiefs

SCOTTISH ministers signed off £2 million worth of bonuses for two government enterprise organisations in the depths of the economic crisis, it was revealed yesterday.

Managers at Scottish Enterprise and Highlands and Islands Enterprise (HIE) received five-figure bonuses as part of a 1,035,859 bonus pot dished out to staff for 2009/10 - on top of the 965,000 paid out last year.

The bonuses at Scottish Enterprise were handed out at a time when the quango was engaged in a 20m efficiency drive that saw nearly 400 posts made redundant.

Scottish Enterprise said the bonuses were paid as part of a two-year pay deal which was agreed with the Scottish Government in June 2009, when the recession was at its lowest point.

The figures were uncovered by the Scottish Liberal Democrats, who want to see all public sector bonuses scrapped and have Scotland's economic development bodies dissolved and replaced by Regional Development Banks.

Lib Dem finance spokesman Jeremy Purvis said: "SNP ministers forked out an average bonus of over 10,000 last year to the already highly paid Scottish Enterprise management team. What makes me especially angry is that at the time I was meeting Jim Mather, the enterprise minister, to try and save one of the biggest textile businesses in the borders, and he said that there was no money to help it.

"Over a hundred people lost their jobs. They will be interested to know that SNP ministers were at the time signing off 1m of bonuses."

A spokesman for Scottish Enterprise defended the bonuses. He said: "These payments were paid to our highest-performing staff members across all grades and relate to performance during 2009/10.

"The bonuses were paid as part of a two-year pay deal which was agreed with the Scottish Government in June 2009.

"We fully recognise the current budget challenges within the public sector and as a result have agreed with staff that there will be no performance bonuses in 2010/11. There will also be a one-year base pay freeze for staff who earn more than 21,000.

"Finally, it is worth highlighting that since 2007, as part of our ongoing commitment to effectiveness and efficiency, Scottish Enterprise has reduced its head-count by 390 staff (25 per cent), generating efficiency savings of around 20m.

Highlands and Islands Enterprise also said that they have no bonus arrangements in place for 2010/11.

A spokeswoman said: "Performance-related bonus arrangements are agreed as part of the HIE pay remit, which is approved by the Scottish Government."For 2009/10, all HIE staff who performed effectively, from senior management to cleaners, were eligible to receive a flat-rate payment of 250 each, pro rata for part-time staff."

A Scottish Government spokesman said: "The Scottish Government is introducing a pay freeze for public sector workers in response to Westminster cuts to our budget of 1.3 billion. Our pay policy suspends access to bonuses for 2011/12.

"Ministers have shown a lead by again taking a pay freeze in 2010/11, releasing about 25,000 for frontline services. And we have again exceeded the targets we set for public sector efficiencies, delivering savings in 2009/10 of 1,470m against a target of 1,069m.