Labour links run deep amid 'cronyism' of Scots quango establishment

Most of the board members whose appointments came under scrutiny four years ago - when Henry McLeish made the "bonfire of the quangos" one of the central planks of his administration - are still in their jobs, while others have moved on to new and even more lucrative placements.

Despite previous denials of cronyism, many of the high earners among Scotland's 790 quangocrats still have extensive links to the Labour party or the Scottish Executive.

Yesterday, The Scotsman revealed how the Scottish Executive had handed its 144 quangos responsibility for spending 1.6 billion a year more than in 2001, when it first pledged to slash the number of unelected public bodies.

Spending on quangos has soared to nearly 9.6 billion a year and they are run by 790 quangocrats, with a total staff pool of 172,834. The number of quangos has been cut by only seven since McLeish's "bonfire" promise.

But with many quango board members receiving considerable salaries for their roles - often, in effect, second jobs - and a huge majority among those who declare political activities having links to the Labour Party, it is clear that cronyism survives.

The current batch of chairmen and board members demonstrates that even if the overriding principle of selection is based on merit, it does not hurt to be, or to have been, an active Labour politician, or to have worked for the Scottish Executive in some previous capacity.

Brian Cavanagh and John Mullin, formerly of Edinburgh and Strathclyde councils respectively, are still on their health boards. Esther Robertson, a former Labour parliamentary candidate, has held on to the chairmanship of the Scottish Further Education Funding Council, on an increased salary of 33,636 a year.

Former Edinburgh council leader Lesley Hinds and Donald Anderson, the current leader, retain their roles on the Health Education Board for Scotland and VisitScotland respectively.

Brian Monteith, the Conservative public services spokesman, said that it was clear that Scotland's quangos had failed to shake off the accusations of cronyism and called for tougher action to stamp out the practice.

He cited recent allegations made against Mr Cavanagh, the 36,505-a-year chairman of Lothian NHS Board, as proof that cronyism remains prevalent. Mr Cavanagh was accused of allowing the former Foreign Secretary Robin Cook to vet a press release to save him political embarrassment.

"We have seen, with the accusations of cronyism there, a typical example of how former Labour politicians are now doing the bidding of ministers," he said. "There is a strong case for taking these appointments away from ministers and making the party political activities of these nominees more obvious."

He also questioned the practice of appointing some individuals to a number of different quangos. "When individuals begin to receive such large sums from many public bodies, a question has to be raised about their independence from their political masters," he said.

"Setting a ceiling on the number of bodies or the amount of remuneration could be a solution to this."

Karen Carlton, the new Scottish Commissioner for Public Appointments, has drawn up a code of conduct in an attempt to address the issue of cronyism, and put it out to consultation.

But the draft code makes it clear that the commission has no power to review existing appointments or to recommend the disbanding of quangos.

The decision to introduce a new code of conduct is seen in some quarters as a tacit admission that the current system is deeply flawed.

A spokesman for Ms Carlton said the code was aimed at making the appointments process to quangos more transparent and anonymous to remove the potential for bias. "The point is to try to broaden the range of suitable people for these posts with a view to improving the way our public bodies are run," he said.

Asked if that suggested there were flaws in the current system, he replied: "You can draw your own conclusions. Karen Carlton has two main tasks - to produce a new code of practice and to produce a diversity strategy to address the issue of making public appointments available to a wider range of people."

He said she had no powers to reduce the number of quangos . "Her remit is to make sure that Scotland has the best public appointments system it can have. She has the power to scrutinise the appointment process and, where there is a question mark over the process, she can call it to a halt."

The Scottish Executive defended the current system. A spokesman said: "Public bodies are accountable - they are accountable to ministers and they are accountable to Parliament. They are also independently audited to ensure taxpayers' money is spent wisely.

"The Executive has made progress in reviewing and modernising the whole system to ensure there are fewer, fitter and fairer public bodies. One key aspect of this is the creation of an independent Scottish Commissioner for Public Appointments to oversee the system."

The current batch of quangocrats come from a wide range of backgrounds, but some areas are better represented than others.

Of those listed on the Scottish Executive's Directory of Public Bodies, 71 board members state their profession as councillor - half of them Labour - with 46 declaring themselves to be some sort of management consultant.

Academics are well represented, with 58 members, but so too are retired civil servants, of whom 21 are listed. There is also a multitude of other professions listed, such as three housewives, five clergymen and 12 social workers.

There is no obligation to declare political activities, but among those who have done so, Labour dominates. There are 93 Labour, 24 independents, 24 Lib Dems, 14 Conservatives, eight SNP and one Green.

It is clear that since Labour first promised a bonfire of the quangos before the 1997 general election, little has changed in the frequency with which friends of the party and those who have worked for the government find their way on to the boards of public bodies.

The Code of Practice for Public Appointments states that "all public appointments should be governed by the overriding principle of selection based on merit, by the well-informed choice of individuals who, through their abilities, experience and qualities, match the needs of the public body in question."

Among those benefiting from the current system are Keith Geddes, a former Labour leader of Edinburgh council, who collects 23,233 from Scottish Natural Heritage and the Accounts Commission.

Rita Miller, who receives 7,305 to sit on Ayrshire and Arran NHS Board, has twice contested the Ayr seat for Labour, as well as being a community services convener on South Ayrshire Council. She now lists herself as a parliamentary assistant. Hugh Raven, a former parliamentary assistant to education minister Peter Peacock, gets 7,805 to sit on the board of Scottish Natural Heritage. He stood unsuccessfully for Labour in the Scottish parliamentary elections in Argyll and Bute.

Pat Kelly stood unsuccessfully as Labour's West of Scotland list candidate in the 1999 Holyrood election and receives 11,000 for sitting on the board of Scottish Water and 7,305 for NHS 24, while also sitting on the board of Scottish Enterprise Edinburgh and Lothians, and the Civil Service Appeal Board.

There are also jobs for the former Labour Euro MP Sir Kenneth Collins, who gets 44,700 to chair the Scottish Environment Protection Agency, while Campbell Christie, former general-secretary of the Scottish TUC, is paid 7,305 to sit on Forth Valley NHS Board. He is also vice-chairman of the British Waterways Board, for which he receives 14,157 a year for 3.5 days per month, and he is a former board member of Scottish Enterprise.

Additional reporting by Michael Blackley

Party ties of husband and wife on 86k

A COUPLE with strong Labour Party links are Professor Alan Alexander and his wife Morag, who have a combined annual salary of 85,939 from part-time posts.

As The Scotsman reported yesterday, the couple each chair one quango and sit on another, while Prof Alexander is also on the board of an English-based quango.

Professor Alexander, 61, collects 63,270 a year for his roles as chairman of Scottish Water, member of the Accounts Commission and seat on the English-based Economic and Social Research Council.

Mrs Alexander receives no payment for sitting on the board of the Care Commission, but gets 22,669 a year for chairing the Scottish Social Services Council.

Although the couple prefer not to declare their political affiliations - as they are permitted to do - they have both been active in the Labour Party.

Prof Alexander is a former Labour Party parliamentary candidate and councillor, and he and his wife, a former director of the Equal Opportunities Commission in Scotland, were both listed as party members in 2001 in Glasgow Shettleston.

Prof Alexander bagged his first quango in 1998 with the 25,466-a-year chairmanship of West of Scotland Water. "I was teaching public management and thought it would be something interesting to do," he said.

When the job was abolished in 2002, the chairmen of the three regional boards applied for the new post of chairman of Scottish Water, and Prof Alexander was again successful.

The appointment stipulated he should work 3.5 days a week, for 77,000 a year. Earlier this year the job was advertised again and Prof Alexander was subsequently reappointed on 52,650 a year for 2.5 days a week.

He explained that he also applied to sit on the Accounts Commission in 2002 after spotting an advert for the job. He was interviewed and references were taken up, he said, before he was accepted as a board member on 4,500 a year.

As a member of the English-based Economic and Social Research Council (ESRC) and chair of the ESRC's audit committee, he receives an additional 6,120 a year for one day a month. A guide to quangos published earlier this year listed the ESRC, which has a budget of 91 million and 111 employees, as one of the ten most useless.

The report was produced by the Efficiency in Government Unit, a think-tank sponsored by the Centre for Policy Studies.

Despite being paid nearly four times the average Scottish salary for his collection of part-time posts, Prof Alexander said he believed he had earned his money and that he had been selected on merit for his jobs.

He was adamant that his political background had not benefited his applications. "The Labour thing comes with the territory," he said. "I haven't been a member of the Labour Party since 1999/2000. I haven't done any active work. I went through the process and I talked to civil servants. I haven't seen any of the ministers who appointed me."

Prof Alexander said he would be nearly 65 when the chairmanship of Scottish Water was next up for renewal. But although he did not think he would go on indefinitely, he doubted whether he would be ready to put his feet up and "tend my garden".

GETHIN CHAMBERLAIN

CHIEF NEWS CORRESPONDENT