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New Zealand pulls £2.5million Commonwealth funding over Baroness Scotland Labour peer contract

Embattled Commonwealth chief Baroness Scotland’s hopes of keeping her job suffered a blow yesterday after a snub by a member country.

New Zealand has pulled the plug on its annual £2.5million funding for the Commonwealth Secretariat because of ‘significant weaknesses in its approach to managing procurement’, a spokesman for its foreign ministry said last night.

The rebuff emerged after £160,000-a-year Commonwealth Secretary General Baroness Scotland was strongly criticised by internal auditors for granting a lucrative consultancy contract to a firm run by a Labour Party friend.

The organisation’s audit committee accused her of ‘circumventing’ usual competitive tendering rules by awarding a £250,000 commission to KYA Global. 

The firm is owned by fellow Labour peer Lord Patel of Bradford, who served alongside Baroness Scotland as a minister in Gordon Brown’s government.

Lord Patel’s company was contracted to carry out a review of the secretariat. But the audit committee said the firm was ‘apparently insolvent’ at the time with debts of nearly £50,000.

New Zealand has stopped its £2.5million annual Commonwealth funding after Baroness Scotland was accused of ‘circumventing’ procurement rules to commission KYA Global, run by Lord Patel of Bradford (pictured with her in 2017, above)

New Zealand, one of the secretariat’s biggest contributors, made the decision to block funding last month. 

Prime Minister Jacinda Ardern, 39, is the Commonwealth’s most high-profile female political leader.

Baroness Scotland, 64, has been branded ‘Baroness Brazen’ and ‘Baroness Shameless’ for her lavish spending. 

She has been under fire since it was disclosed in 2016 that she spent £338,000 refurbishing her grace-and-favour apartment in Mayfair, central London.

It later emerged that £590,000 of the UK’s foreign aid budget had been spent on Marlborough House, the secretariat headquarters, in two years. She was also attacked for appointing political allies to key posts.

It came as a senior official forced to quit his secretariat job while working under Baroness Scotland won nearly £300,000 compensation.

Baroness Scotland, 64, (right with Prince Harry in February last year)  has been branded 'Baroness Brazen' and 'Baroness Shameless' for her lavish spending

Baroness Scotland, 64, (right with Prince Harry in February last year)  has been branded ‘Baroness Brazen’ and ‘Baroness Shameless’ for her lavish spending

Baroness Scotland, who was born in the Dominican Republic, retains the backing of Commonwealth countries in the Caribbean, but faces the risk of being dumped before the Commonwealth Heads of Government Meeting in Rwanda in June, which will be attended by Prince Charles.

The disclosures have left her hopes of winning a second four-year term in her post hanging by a thread. Her first term ends on March 31.

Britain occupies the rotating chairmanship of the Commonwealth, giving Boris Johnson a major say over who is secretary general.

Tory Party co-chairman James Cleverly, a close ally of the Prime Minister, and whose mother is from Sierra Leone, is said to be among Baroness Scotland’s powerful enemies in the Government.

Mr Cleverly is said to have been highly critical of her at meetings of Parliament’s all-party Commonwealth group.

The investigation into Lord Patel’s KYA Global contract was carried out by accountancy giant KPMG at the request of the Commonwealth High Commissioners, the secretariat’s board of governors.

KPMG found that the consultancy contract was given to Lord Patel in April 2016 – days after Baroness Scotland was appointed – on ‘her personal recommendation’ because he had ‘a high level of proven trust with the secretary general’.

She asked one of her deputies to fill out a form waiving the usual competitive tendering rules, which she then approved.

New Zealand, one of the secretariat's biggest contributors, made the decision to block funding last month. Prime Minister Jacinda Ardern, 39, (pictured) is the Commonwealth's most high-profile female political leader

New Zealand, one of the secretariat’s biggest contributors, made the decision to block funding last month. Prime Minister Jacinda Ardern, 39, (pictured) is the Commonwealth’s most high-profile female political leader

According to KYA Global’s accounts, it had assets of £971 and debts of £48,762 at the time.

The audit committee said yesterday: ‘Awarding an apparently insolvent company two contracts totalling £252,000 is unusual.’

Baroness Scotland declined to comment. Her lawyers said the decision to award the contract was fully justified and complied with procurement procedures at the time.

The secretariat is the central administrative hub for the Commonwealth, made up of 53 countries. It declined to comment last night. 

New Zealand Foreign Affairs Ministry spokesman said it had stopped giving cash to the Commonwealth Secretariat because the auditors report had found ‘significant weaknesses in the Commonwealth Secretariat’s approach to managing procurement.’

It added: ‘New Zealand has put on hold its voluntary financial contribution to the Secretariat until we receive independent confirmation the recommendations from the audit report have been addressed by the Secretariat.’

Read more at DailyMail.co.uk


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