Inquiry report slams ex-NHS chief

The former finance director of Tayside health board could face court action to recover #32,000 after an independent investigation found he and three other senior staff members had breached NHS pay regulations.

The investigation established that the four sanctioned #113,051 in overpayments to themselves and more than 50 other members of staff.

The Procurator Fiscal announced it would not prosecute the four despite the damning report by David Kilshaw, chairman of Borders health board.

Kilshaw said the four had ‘compromised the principles of financial governance’ and misled the board’s remuneration committee with ‘inadequate and incorrect information.’

According to the report, CIPFA member John Hudson, the board’s former FD, benefited most, receiving #31,603 in overpaid salary, allowances and payments made in lieu of untaken leave.

The board’s remuneration committee was also misled over the terms of an early retirement package offered to Hudson. In May 1996, it was told the package would involve a one-off lump sum of #58,000. The full cost was in excess of #83,500.

It later emerged that Hudson could have retired, at no cost to the board, in January 1997.

The report said there ‘are, or would have been, prima facie grounds to invoke disciplinary procedures’ against Hudson, former general manager Lesley Barrie, former human resources director Terry Clark and the director of commissioning and strategic management, Nigel Young.

The wrongdoing was uncovered by the board’s accountant, Henderson Loggie during a routine audit carried out last year. The firm passed its findings on to the Accounts Commission, while the board passed the information on to the Procurator Fiscal.

‘We will seek to recover every penny paid to officers and staff in contravention of NHS regulations,’ said Frances Havenga, who now chairs the board. ‘We will use all means at our disposal to pursue those responsible for the failures identified by the Kilshaw report – including the courts.’

Accounts Commission controller Robert Black said: ‘The problems in Tayside were a direct result of a failure to apply principles of accountability, probity and openness.’

Hudson was not available for comment.

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