25.10.17
HS2 loses another executive as CFO resigns over redundancy payments
HS2 Ltd has announced that another one of its bosses will leave the company at the end of the financial year.
Chief financial officer, Steve Allen, will leave HS2 following irregularities in the project’s redundancy payments that were revealed in July.
A report by the NAO showed that HS2’s redundancy payments had exceeded the rates set by DfT by a huge £1.76m.
Redundancy compensation was set at one month’s salary per year of service, which whilst broadly in line with the Civil Service Compensation Scheme, these terms had been superseded in November 2016 before any redundancies were finalised, and were well in excess of the authorised statutory level.
In addition, enhancements in the voluntary element of the scheme meant that individuals could receive lump packages of over £95,000.
Commenting on the findings of the NAO report, Steve Allen said: “The weaknesses highlighted by the NAO report resulted in both the HS2 Executive and Board being misinformed about the status of critical approvals for redundancies.
“Those assurances were given by teams for which I was responsible and, obviously, I regret that.”
Explaining the decision for his exit, he added: “So, whilst we are now putting in place the measures to strengthen financial governance systems and to provide robust financial stewardship for the company, I believe it will be appropriate for me to move on.”
The chief executive of HS2 Ltd, Mark Thurston, explained some of the issues faced by the organisation when he joined earlier this year, which included redundancies agreed by the company.
He thanked Allen for his work in rectifying the errors made, but described his decision to move on as “honourable.”
He also added that Allen’s departure will allow him to: “build the executive team for the next phase of the project.”
Allen is the latest in a line of executives to have left the company over the past 12 months. In August Alison Munro announced her retirement from her role as HS2 phase 2 managing director, and in September RTM reported that Paul Griffiths had been appointed as her successor.
Beth West announced that she would be leaving her role as the organisation’s commercial director back in June, to join land developer, Landsec.
And at the end of last year, former chief executive, Simon Kirby, stood down shortly after an NAO report warned that the project risked missing its target of delivering phase 1 by 2026 - a decision that sceptics, such as Joe Rukin, campaign manager at Stop HS2, have criticised, .
Both Thurston and Allen are required to give evidence at the House of Commons Public Accounts Committee regarding the redundancy payments on 30 October.
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