MSPs demanding answers over bank chief’s appointment

A Holyrood committee is demanding answers over what “fit and proper person” test was undertaken before the head of Scotland’s new national investment bank was appointed amid concerns over a previous £8.6m regulators fine.

Holyrood’s public audit committee is now demanding fresh answers from Mackay’s successor, Kate Forbes, about the process which led to Watt’s appointment. Picture: PA

It emerged recently that Scotland’s public appointment ombudsman had to stand aside from overseeing Willie Watt’s appointment last year.

The firm which Watt previously led was fined £8.6million in the UK and America over a conflict of interest case.

Watt was appointed as chairman of the new institution aimed at spearheading economic growth in Scotland by former finance secretary Derek Mackay.

But Holyrood’s public audit committee is now demanding fresh answers from Mackay’s successor, Kate Forbes, about the process which led to Watt’s appointment. Committee convener Bill Kidd states in his letter that the Code of Practice for Ministerial Appointments to public bodies in Scotland requires Mackay to have taken steps to confirm that the applicant’s “conduct to date has been compatible with the public appointment”.

His letter adds: “I am writing to request further information about the steps taken by the appointing minister to confirm that Mr Watt was a fit and proper person for the position, including how it was confirmed that his conduct to date had been compatible with the public appointment.

“The committee wish to understand what this confirmation process involves in practice.”

The national investment bank is expected to be operational by the end of the year and will invest up to £2 billion of public funding over the next decade in Scottish firms.

Watt was chief executive at Martin Currie in 2012 when it was fined £8.6million by US and UK regulators.

It came after the Edinburgh-based firm caused one client to enter into a deal which saved another of its own clients from financial difficulties.

The committee letter has been dispatched following a recent evidence taking session with Caroline Anderson, the Commissioner for Ethical Standards in Public Life in Scotland.

The watchdog revealed she had played no role in the oversight of the “unregulated” appointment of the chair of the bank because it fell outwith her remit.