THE chief executive of Scotland's third-largest city council dramatically quit yesterday – minutes before he was grilled by a public accounts watchdog on the financial crisis facing his authority.
Douglas Paterson, the boss of Aberdeen City Council, announced he was planning to take early retirement to allow a new chief executive to take control of turning around the council's "precarious" financial plight.
During the inquiry, the author
ity's external auditor said the council had plundered £70 million from its reserves over the last three years in a bid to balance the books. Last night, however, the council insisted just £12 million had come directly from the reserves.
A spokesman said: "A total of £12 million had been taken directly from reserves over the past three years, together with £59.9 million from capital receipts (sale of assets]."
Mr Paterson's decision to quit his £120,000-a-year post was disclosed to staff shortly before the start of a hearing by the Accounts Commission into a report by the Controller of Audit, which
labelled the council's financial situation "precarious" and uncovered evidence of "significant weaknesses" in major services.
BREAKDOWN OF FUNDSABERDEEN City Council has three separate accounts to fund its various services – a general fund, a housing revenue account and a capital expenditure fund.
Caroline Gardner, the Controller of Audit, told the inquiry: "The balance on (the council's] general fund is forecast to be £2.9 million, significantly below the £9.3 million required under council policy and likely to be below the level required to cover the financial pressures that it faces."
The council would have general reserves of less than £3 million at the end of the current financial year. The inquiry also heard there was a further £4 million in the housing revenue account and "some money" in the capital fund ring-fenced for certain expenditure.
Gordon Edwards, the council's corporate director for resources management, said: "We have put £12 million into a provision for future compensatory payments."
The full article contains 337 words and appears in The Scotsman newspaper.
