Auditor probes Officegate row

Mr McLeish resigned over the subletting of his office

The financial watchdog Audit Scotland has confirmed it is investigating complaints about council grants to a charity which leased office space from former First Minister Henry McLeish.

The Scottish National Party formally asked for the inquiry into claims that Fife Council paid £40,000 to the Third Age Group despite the fact that its management committee had been disbanded.

The SNP said that the charity was run by allies of Mr McLeish and it wanted to know why the group was granted cash after it had been wound up.

Third Age rented space in the Glenrothes constituency office of Mr McLeish, MSP for Central Fife and for several years the Westminster MP for the same constituency.

Tricia Marwick MSP: "Public money"

After mounting controversy over the subletting of his office to various organisations, Mr McLeish decided to quit after the disclosure of a further sublet, involving the Third Age Group.

Now defunct, the group organised lunch clubs for the elderly.

Tricia Marwick, Scottish National Party MSP for Mid Scotland and Fife, said the group received £20,000 from Fife Council in April 1998 even though its management committee had been wound up two months earlier.

The council made a further payment of £20,000 to the organisation in May 1999, she said.

Checking mechanism

In a letter to Scotland's auditor general, Robert Black, she said: "Fife Council has a responsibility to ensure that public money is spent wisely and they are accountable for those decisions.

"In this case the council's own procedures have been set aside or the checking mechanism simply was not there."

Ms Marwick saidshe was not satisfied that council officials would be able to investigate without "inference" from the political leadership of the Labour-led council.

Meanwhile Keith Harding, Tory MSP for Mid Scotland and Fife, tabled a Holyrood parliamentary question on the affair, and said he had asked for a full report from Fife Council.

The row centred around Mr McLeish's Fife office

"The Third Age Group had extremely close links with members of the administration on Fife Council, which funded it directly," he said.

"Given that according to newspaper accounts the group was being given money even though it had ceased operating, it is essential that a full and thorough investigation is carried out into how the sub-let of the former first minister's office was funded."

Fife Council said its standards and audit committee was waiting for a report on the amount of council funding for the Third Age Group.

Council chief executive Douglas Sinclair, who is leading the investigation, said: "I take my responsibilities to serve the public seriously.

"That means open, honest and unbiased investigation. I take extreme exception to any suggestions that there is any collusion between any political party and myself over matters of probity."

Voluntary organisation

He went on: "I am surprised Tricia Marwick is making these allegations before the report is published.

"Everything the council does is subject to scrutiny by Audit Scotland. They can review any report at any time, and if anyone has any concerns regarding the council's handling of an issue they can raise the matter with Audit Scotland."

Fife council leader Christine May insisted that all the funding for the group was used entirely towards providing day care support to older people across Glenrothes.

"There is no question of funds being used for any other purpose," she said.

"Documentation supported the facts that the Third Age Group had been a properly constituted voluntary organisation that carried out valuable work in the Glenrothes area and merited financial support.

"However the standards and audit committee have asked that a further investigation be carried out into the continued funding of the organisation by the council after its management committee ceased to exist."