Welsh Development Agency - Controversy

Controversy

In the 1990s the WDA attracted controversy when its chairman, Gwyn Jones, a businessman, was appointed by the then Welsh Secretary, Peter Walker after meeting him at a Conservative Party fundraising lunch. He later resigned from the post ahead of a 1992 Commons Public Accounts Committee report that condemned the agency for:

• giving out illegal redundancy payments totalling £1.4m between 1989 and 1992;
• paying £228,000 to ensure non disclosure from former executive, Mike Price, whom it sacked following internal conflict in 1991;
• allowing free private motoring for board members between 1984 and 1992;
• allowing chairman, Dr Gwyn Jones, to obtain a £16,895 WDA rural development grant for one purpose, but when he used it for another without informing the Agency as required, he was not asked to pay it back when a WDA inspector detected the change;
• flying directors on Concorde; and
• using public money to investigate a management buyout that would have privatised the agency. A sum of £308,000 was discovered in the 1988-1989 accounts to pay for a feasibility study to this end.

The Commons Public Accounts committee became concerned when the Auditor General, Sir John Bourn, discovered many irregularities during his annual examination of the Agency's accounts.

Criticism also followed the appointments of Neil Carignan and Neil Smith by Gwyn Jones. Carignan's employment was terminated over his poor performance, but he was allowed to take £53,000 of office equipment with him. Smith was hired as a marketing director, but the WDA failed to check his CV, which was fraudulent, and that he was a discharged bankrupt.

Smith was later investigated by police over his hiring of models for claimed promotional work, and he was later convicted of theft and deception and went to prison.