An NHS Tayside pay-off that has been mired in controversy was “good value”, according to the boss of Scotland’s health service.
Lesley McLay received £32,000 more than she was due from her original contract after the health board decided to increase her notice period when she was no longer chief executive.
The country’s public spending watchdog said there were several errors made by Tayside bosses in Ms McLay’s £90,000 severance deal.
But Paul Gray, who is the outgoing chief executive of NHS Scotland, defended the package, saying although it was “let down by errors”, it was a good one for the taxpayer.
He told The Herald: “Audit Scotland said the steps taken to reach the settlement were reasonable but there were errors in the process.
“The error in the process, which was the failure to go through the Remuneration Committee, has been put right – albeit retrospectively.
“What Audit Scotland also said was that the total costs of the negotiated settlement to NHS Tayside were less than the Central Legal Office’s estimate of the cost of fighting an unsuccessful legal case, so what they did was – according to Audit Scotland – reasonable and value for money.
“In that sense, the failure to follow due process was not right and I’m glad they put it right, albeit retrospectively.
“But it’s disappointing that a settlement that was reasonable and represented good value for money, which would be very important features to me as the accountable officer, fell short in terms of process.”
Ms McLay, a former nurse who took the top post five years ago, was ousted as chief executive in April after ministers lost patience with the board’s worsening finances.
It came soon after a series of financial scandals came to light, including the use of charitable donations to pay for day-to-spending.
Fearing a legal challenge, senior Tayside executives agreed during exit negotiations with Ms McLay to extend her notice period to six months, which was based on the incorrect belief her original contract was not comparable with other CEOs.
The move was only approved by the remuneration committee in November, several months after she left the organisation in July.
Alex Neil, the former Health Secretary and an SNP MSP, accused board figures of “total incompetence” in the way the pay-out was handled in a Holyrood committee last week.
NHS Tayside chairman John Brown said they fixed their errors, adding: “We stand by that decision and we believe the approach we took was the right thing to do to avoid a drawn-out legal process which would have cost the public purse a significantly larger sum of money.”
