Baroness Scotland ‘circumvented rules’ to hand lucrative £250,000 Commonwealth contracts to her Labour peer friend
- She commissioned consultancy KYA Global, run by Lord Patel of Bradford
- They are both Labour peers and friends who sat together int he House of Lords
- Audit committee report said that KYA was ‘apparently insolvent’ when hired
- Baroness Scotland denies wrongdoing and says decision was ‘wholly justifiable’
Commonwealth chief Baroness Scotland ‘circumvented’ the organisations rules to hand a £250,000 contract to a fellow Labour peer, a damning internal report revealed today.
The multi-nation organisation’s secretary general was accused of going around procurement rules to commission KYA Global, run by Lord Patel of Bradford.
An internal report found that the agreement to audit the Commonwealth Secretariat that she leads risked ”serious reputational if not actual damage’ to the organisation, the BBC reported.
It claimed that KYA Global was ‘apparently insolvent’, with debts of more than £40,000, at the time it was awarded two contracts – something lawyers for the Baroness said was not true.
The Secretariat’s audit committee hired accountancy firm KPMG to investigate contracts worth £90,000 and £162,000 to KYA Global in 2016, for a total of nine months’ work.
It found that at the time the company had assets of £971 and debts of £48,762, with the committee’s November report noting that ‘awarding an apparently insolvent company two contracts totalling £252,000 is unusual’.
Baroness Scotland was accused of ‘circumventing’ procurement rules to commission KYA Global, run by Lord Patel of Bradford (pictured with her in 2017, above)
An internal report claimed that KYA Global was ‘apparently insolvent’, with debts of more than £40,000, at the time it was awarded two contracts by the secretary general (right, with Prince Harry)
It added that Baroness Scotland instructed a deputy to issue a waiver around tendering rules for the deal, an action that ‘circumvented a fundamental control in the procurement process’.
The BBC reported that the report concluded: ‘The audit committee is concerned that the acts and omissions set out above as well as the absence of any explanation for those failures endangers the integrity of the Secretariat.
‘At the very least the failures identified risk serious reputational if not actual damage to the Secretariat.’
Baroness Scotland is a former attorney general under Gordon Brown who became secretary general in 2016. She sat on the Labour benches with Lord Patel in the House of Lords.
Her lawyers at City firm Carter-Ruck issued a statement denying wrongdoing, saying that the contracts were awarded ‘on the basis of its proven track record in change management consultancy’.
It added that the firm’s skills were ‘dearly needed’ when Baroness Scotland took over.
It said: ‘This decision was wholly justifiable and SG Scotland was advised that this complied with the procurement procedures that were in force at the time.
‘SG Scotland began her post as Commonwealth Secretary-General on 1 April 2016 when the Secretariat was in a very poor financial position and was in dire need of reform.
‘She was tasked with transforming the organisation urgently.
‘The appointment of KYA, a leading change management consultancy, was one of the steps SG Scotland took to bring about that change in haste.’
The firm also also said KYA ‘has never been deemed insolvent and it is false to insinuate otherwise’.