Leading councils urgently probe Scots Aid Sierra Leone charity
Scotland’s biggest councils are probing an aid charity after it emerged it had spent 83p of every pound it received last year on salaries and administration costs.
Glasgow City Council is among a number of local authorities investigating Uddingston-based Scotia Aid Sierra Leone after freedom of information (FoI) requests revealed it uses complex property deals to exploits charity rates relief to boost its income.
The charity’s accounts show an income last year of £1,020,365 – but just £171,000 of this went to “charitable activates”.
It is alleged some £313,000 of its income went on consultancy fees to five companies associated with directors Dan Houston and Kieran Kelly and CEO Alan Johnston.
The charity’s highest earner last year was Kelly, 32, who earned £120,000 while Houston’s earnings were £104,000 and Alan Johnstone was paid more than £92,000.
Their wages are paid via shell firms to minimise paying tax.
Scotia Aid was set up by Dan Houston, 62, in 2010 to run health, education and welfare programmes including building schools in Sierra Leone.
But two former employees have turned whistle-blowers, exposing alleged dealings which they say have lined bosses' pockets at the expense of vulnerable people in the west African country.
We would expect OSCR to take action - North Lanarkshire Council
They allege the charity uses its status to reduce rates bills for businesses who can’t fill empty premises.
Charities are often given preferential rates when they move into empty premises – with some paying no rates at all for a contracted period.
As businesses still have to pay rates on empty premises, the whistle blowers claim Scotia Aid goes into partnership with these businesses, taking over the premises for a fee significantly less than the usual local authority rates.
Its accounts show almost 90% of its income was from firms associated with property with some 27 different organisations or landlords paying Scotia Aid £867,017 in 2014.
The charity says it uses it uses premises to store supplies and furniture intended for Sierra Leone.
It has applied and received rates relief from Dundee City Council, Glasgow City Council, South Lanarkshire Council and North Lanarkshire Council.
Last month Scotia Aid applied to take over all 22 empty shops in Cumbernauld town centre to store “store office and school furniture en-route to Sierra Leone”.
But the charity withdrew the application after North Lanarkshire Council officials wrote back saying they wanted to inspect the properties individually.
Glasgow City Council confirmed Scotia Aid had been receiving rates relief on properties in the city since 2011 while South Lanarkshire Council said it had launched a full investigation into the charity.
A spokesman for North Lanarkshire Council said: “We would expect the Office of the Scottish Charity Regulator (OSCR) to take action against any charity that was deemed to be conducting their business activities in a manner that would conflict with the ethical objectives of their organisational remit and suspend the registration pending a full investigation.”
A spokesman for OSCR said: “We would not comment on investigations into individual charities.”
