SHETLAND Islands Council’s former chief executive David Clark could have claimed up to £2 million for personal damages, it emerged at the public inquiry into the local authority on Monday.
Three Shetland councillors also told the Accounts Commission public hearing that they had serious reservations about the way in which the council agreed to a severance deal with Mr Clark for a total of £285,000 with his tax and legal fees covered by the SIC.
Earlier in the day the council’s employment law specialist Murray McCall of Anderson Strathern told the hearing that he had advised councillors that Mr Clark could claim as much as £2 million for a range of potential damages, including personal injury, defamation, harassment and reputation damage.
Mr McCall said: “Initially, the assessment was that as much as £2 million could be made available. There was the likelihood that the chief executive would not find any other work. There could have been a seven figure sum in damages.”
The damage was caused by the leaking of a confidential complaint from six councillors against Mr Clark last December, the hearing was told. This act had removed the council’s chance of dismissing the chief executive.
In the morning convener Sandy Cluness had admitted there were failings in the way the council recruited and appraised Mr Clark once he was in post in summer 2009.
Lessons had not been learned from 1999 when the council was criticised for the way it had removed then chief executive Nick Reiter.
In the afternoon councillors Jonathan Wills, Gary Robinson and Gussie Angus said they had not been informed of the final settlement with Mr.
Councillor Wills said that he and other councillors understood that on 12 February the council was sending Mr McCall away to work out the nuts and bolts of a settlement.
Councillor Robinson added: “I expected this would come back to us because we were told nothing would be agreed without our consent.”
Councillor Angus agreed: “It was my understanding the deal would come back for approval.”
He suggested this could be part of the “systemic failure” he saw within the council, that included the chronic leaking of confidential information to the local media.
Mr Robinson said he had taken the matter up with the chief executive of local authority umbrella group COSLA Rory Mair, who represented the SIC during the negotiations, but had not received a reply to his email.
He also claimed that had the convener acted earlier on concerns about the chief executive there would not have been a need to pay him off.
The six councillors said that there were serious relationship problems within the council.
Councillor Cecil Smith said there were problems between members and officers and between officers themselves. “We have to sit down and iron this out. The main thing is the community has to get back our confidence after what’s happened in the past year.”
Councillor Angus said that he had discussed holding a formal private meeting for all councillors with the convener to discuss the problems of the past and “try to move on”, and Mr Cluness had agreed to move ahead with this.
Meanwhile councillor Wills raised concerns about the privilege of raising confidential matters at the hearing saying he felt inhibited by the lack of clarity on the issue. “If you want to get to the bottom of this you have to read the settlement (with Mr Clark) and the complaint made by the six councillors.”
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