Seòmar agus comataidhean

Agenda item 2 is consideration of “The 2022/23 audit of Forth Valley College”, which is a section 22 report. I am pleased to welcome our four witnesses, who join us in the room. We are joined by the Auditor General, Stephen Boyle—good morning; Mark MacPherson, audit director at Audit Scotland; Derek Hoy, senior manager at Audit Scotland; and Michael Speight from Forvis Mazars, who is the auditor who carried out the initial audit work.

We have some questions to put to you on the report, Auditor General, but before we get to those, I invite you to make a short opening statement.

Thank you, Auditor General. That is a useful introduction to the report and to our question areas. First, I turn to the delay. Your report is a section 22 report for the financial year 2022-23, but you published it in May 2025. Could you elaborate on the complexities that you have referred to? It seems to the committee that there was an inordinate delay in carrying out the audit and signing off the report.

Colin, thank you very much indeed. I invite Stuart McMillan to put some questions to you, starting off on governance and then about whether things have changed.

We will return to the point about delays. It is evident from your report that there were issues going back to 2020, with contracts not having been signed off or not existing at all. You have already mentioned that the procurement breach was identified in November 2022. The issues that have been identified are fairly old. Here we are in 2025 and, perhaps not surprisingly, some of the people who were involved in 2020 and 2022 are no longer there. That is problematic, and it is one of the results of having such a delayed process.

However, one of the changes in posts is related to the findings of the audit and the issues that are discussed in your report: the departure of the project director—the director of strategic partnerships and regional economy. At one point, she had oversight of the project and then, at another point, she formed a company with the external consultant in which she became a co-shareholder and co-director with that external consultant, while still being an employee of the college. Does that not suggest to you a conflict of interest?

Good morning, and welcome to the 18th meeting in 2025 of the Public Audit Committee. We have apologies from the deputy convener, Jamie Greene.

Under agenda item 1, does the committee agree to take agenda items 3, 4 and 5 in private?

Members indicated agreement.

Before I bring in Graham Simpson, I want to turn to something else. We are not the police; we are the Public Audit Committee, but we can reflect on some of the evidence that was presented to an employment tribunal in an unfair dismissal claim by the former project director, which was convened in June 2024.

In paragraph 29 of your report, you say—you also said it in your opening statement—that it was

“clear there was a mismanagement of funds”.

You say that that is why the police chose not to proceed. However, the evidence that was captured in the employment tribunal’s extended reasons referred to an internal audit. As it was an audit, it very much has provenance, and it is right for the committee, and you as the Auditor General, to address the points that it raised.

The internal audit, which reported on 31 May 2023, raised two quite striking points, which, in my view, go beyond the mismanagement of funds, because it concluded that there were

“false representations by words, or writing or conduct”.

It also said that

“the intention to deceive was established.”

The audit said that there was “no financial loss”, so there was, technically speaking, no fraud, but an “intention to deceive” and “false representations” are extremely damning conclusions to reach in an internal audit report, are they not?

Before I bring in Stuart McMillan to ask about governance and accountability, I want to go back to something that you mentioned a few minutes ago: the newly established Scottish Government ministerial advisory group. In the report, you refer to another body that was established in January under the international trade and investment directorate—a business investment group that comprises Scottish Government policy advisers as well as representatives from the Scottish National Investment Bank and the three enterprise agencies. Is there a danger of overgovernance—a cluttering of lines of accountability—that will make it more difficult to understand where decisions are being made and where direction is coming from?

Thank you for your opening statement. We will move straight to questions from the deputy convener. This morning, rather than asking questions at the end of the meeting, Jamie Greene will ask them at the beginning.

In the interests of transparency, do we know whether the newly established groups publish the agendas or minutes of their meetings that are in the public domain? Do we know exactly what their terms of reference are?