Glasgow University is advertising for a new external member of its audit committee. The ad states that one of the essential requirements of the unpaid post is 'an ability to question and challenge effectively'. The appeal to rigorous impartiality sounds impressive. But this is not an institution noted for its ability to question and challenge the powerful, highly paid academics at the head of it.
We have uncovered disturbing evidence of an expenses scandal 13 years ago, a scandal implicating some of its most senior figures, a scandal so serious that it led to an internal inquiry instigated at the highest level and the temporary suspension of the university's corporate credit cards, a scandal the details of which have only now come to light.
We should say at once that nothing we found in our exhaustive survey of more recent management expenses (2013-16) was comparable. The dinners at Glasgow's smartest restaurants (more than £100 a head in one case), such hospitality as a drinks bill of £500+ for 10, the claims for miscellaneous teas and coffees, the refunds for such items as toiletries and a shaving razor – all these emerged from our trawl of the records. Such claims could fairly be described as errors of judgement at worst.
But the hidden scandal of 2004 was something else entirely. We have obtained 'private and confidential' documents relating to that episode – minutes of meetings of the university's audit committee and the findings of an inquiry ordered by the then recently appointed principal, Sir Muir Russell, former head of the civil service in Scotland.
The inquiry found that un-named senior managers – some of whom would undoubtedly have held professorial rank – had abused credit cards provided in good faith for 'travel, subsistence and entertainment incurred wholly, necessarily and exclusively for university business purposes'. The 'business' items claimed for included alcohol, paintings, chocolates, books, cigars, flowers, groceries, even jewellery. As the inquiry report put it (in a small masterpiece of accountant-speak): '...in the absence of any additional information or justification by the cardholders, we were unable to reconcile expenditure of the type exemplified with the purpose for which the corporate credit cards were provided'.
Equally damning, the inquiry found that some cardholders had claimed for personal outgoings, including travel expenses incurred by partners accompanying them on business trips, 'apparently with the intention of reimbursing the university'. Yet, despite 'a considerable degree of effort', the internal auditors were unable to establish whether all these claims had in fact been reimbursed. There seems to be an implication here that the auditors received less than complete co-operation from some of the 'senior' figures concerned.
From the minutes in our possession, it is clear that the audit committee's concern over abuses of the credit cards extended to a more general anxiety about the quality of financial governance...'The committee noted the view of some of its members that the report highlighted the larger issue of the authorisation of expenditure across the university'. But the immediate issue was the propriety, or otherwise, of individual spending.
The audit committee decided that 'no suggestion of fraud had been unearthed' – a conclusion which avoided any obligation to call in the police – 'but the Principal considered the findings of the report to be sufficiently serious that the [credit cards] scheme should not be continued in its present form'. It was suspended in March 2004 and only reinstated at the end of May that year after 'safeguards' had been put in place.
The root of the problem was that senior managers holding corporate credit cards counter-signed the claims of each other. Among the administrators of the scheme – functionaries well down the pecking order – there was (according to the audit committee) 'a reluctance...to challenge senior staff in what is undoubtedly a sensitive area'. A report from the internal audit services unit stated: 'Matters which ought to have been challenged were accepted and there was a lack of follow-up action in relation to potential non-compliance'.
There are many unanswered questions about the scandal.
Did the finance department abandon its attempts to recover money due to the university as a result of false claims?
How much money was involved? Is any of it still owed?
Why did the auditors find it so difficult to get at the truth?
Were any of the senior managers who claimed for such personal items as alcohol, paintings, chocolates, books, cigars, flowers, groceries and jewellery, and who claimed for their partners' travel costs, ever disciplined? Or did they survive unscathed and go on to a serene retirement on a handsome pension?
Who were these people who thought so little of the distinguished institution which employed them that they were evidently prepared to exploit it for personal gain?
We know the answers to none of these questions. We can only hope that, to borrow the mantra of Scottish public life when bad things happen, 'lessons have been learned' – in particular about the poor practice of allowing senior management to counter-sign each other's claims.
At the conclusion of this series of articles, three points need to be made:
1. Universities and colleges in Scotland receive a colossal sum of money – £1.5 billion a year – at the taxpayer's expense. They therefore have a duty to exercise restraint in the way they spend that public largesse, especially in such discretionary areas as travel and entertaining. They have a further duty to be open in their dealings.
In response to requests from readers, we have completed a comparative study of the recent expenses claimed by senior management at two other
ancient universities, Edinburgh and Aberdeen, and found nothing unusual or untoward.
3. The online records of staff expenses claims at Edinburgh and Aberdeen are up to date, while Glasgow last posted any 14 months ago. If the new external member of the university's audit committee wishes to 'question and challenge effectively', he or she should start by calling for a restoration of the former standards of transparency and accountability – in the public interest.
Photograph by Rebecca Wilson