 Scottish Enterprise has sold off some of its properties |
Scottish Enterprise is to use budget resources from the next financial year to help cover an overspend of tens of millions of pounds, it has emerged. It is understood that the business development agency has been drastically cutting back on spending.
This week it sold off six of its prime sites but still has a major funding gap, estimated at more than �30m.
Scottish Enterprise said it would meet cash commitments and that land sales did not indicate a financial crisis.
A new budgeting system had resulted in the overspend reaching more than �100m.
The agency has changed its budget priorities from a grant system for local enterprise companies (Lecs) to a bidding system for individual projects.
But too many new projects were approved and as a consequence there was a massive overspend.
It is thought that even after drastic cutbacks on all spending the funding gap still stands at more than �30m.
BBC Scotland investigations correspondent Bob Wylie said: "One Lec chairman said to me that the Scottish Enterprise leadership has made a dog's breakfast of the budget.
"And some say that the current land sales that Scottish Enterprise is undertaking are a fire sale - a desperate attempt to raise cash."
E-mails seen by BBC Scotland from the Scottish Enterprise head of finance to local enterprise offices outline an urgent need to pull together a portfolio disposal this financial year by auction.
Scottish Enterprise insists the land sales are not linked to any perceived financial crisis, that they are routine and that the agency will meet all its cash commitments.
A spokeswoman said its new system for allocating resources was to encourage fresh ideas and even out its spending patterns.
She said: "This has successfully led to an increase in the number of potential projects and inevitably required us to review and prioritise what we are actually going to deliver within the resources we have.
"We have been asking project managers and business unit heads to do this for several months and our pipeline of new projects has been reduced by around �70m.
'Suspect value'
"We have also received agreement from the Scottish Executive to make use of some of next year's resources in order to help us meet this increased demand."
Murdo Fraser, the Conservative enterprise spokesman, said: "There are serious questions about Scottish Enterprise's stewardship of their budget.
"This is an organisation that spends nearly �0.5bn of taxpayers money every year.
"Allegations are being made about an overspend and we need answers."
Scottish National Party enterprise spokesman Jim Mather said: "It is widely accepted that the overall effectiveness of Scottish Enterprise expenditure is often of suspect value and lacks a required sense of urgency and accountability.
"These latest revelations will do nothing to restore faith in the organisation."
At the end of January Scottish Enterprise had spent �426m.
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One Lec chairman said to me that the Scottish Enterprise leadership has made a dog's breakfast of the budget
