LARGE payouts to public sector leaders who leave their organisations in the midst of problems have come under fire.

A powerful Scottish Parliament committee has raised the issue of “hefty” severance payments with Finance Secretary Derek Mackay, claiming they are essentially “rewarding failure”.

The committee has written to Mr Mackay after reports by the Auditor General for Scotland highlighted various financial and governance issues in public bodies.

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Examples include the running of the Scottish Police Authority which has recently seen the departure of chairman Andrew Flanagan and chief executive John Foley.

There have also been concerns over the size of pay-outs to former principals of Scottish colleges who left during or shortly after a nationwide series of mergers.

The committee’s acting convener Jackie Baillie said: “We are concerned that some of those responsible for creating major problems within public bodies may be leaving without being held to account for the issues they may have caused.

“What’s worse is that some of these individuals could leave with a hefty pay-off in their pockets, which is essentially rewarding failure and is understandably frustrating for the Scottish public who pay for these public services.

“That’s why we’ve written to the Cabinet Secretary to highlight the problem, which is common to many organisations, and to ensure that the Scottish Government puts an end to rewarding failure as part of its severance policy for Scotland.”

A Scottish Government spokesman said: “The Scottish Public Finance Manual provides guidance on settlement agreements, severance, early retirement and redundancy, making clear that financial compensation should only be offered on a value for money basis with issues of propriety and regularity fully examined.”

The committee has chosen to act because the Scottish Government is currently consulting on a new severance policy for the public sector.