THE brouhaha at the Greater Glasgow Health Board requires public

explanation. Things may not be as they seem. On the face of it the

chairman, Mr William Fyfe, summoned his board and summarily dismissed Mr

Laurence Peterken, the general manager much reviled by sections of the

staff but highly respected among senior management cadres. Why should

this have happened? Mr Peterken's probity and competence are not in

dispute. Rumour has it that Mr Fyfe incurred expenses for travelling and

accommodation and that their level prompted a report from the general

manager. The auditors pronounced themselves satisfied with the claims

and the finance committee took no action. If that is an accurate

account, then Mr Peterken's actions were perfectly consistent with the

principles of public accountability and could in no sense justify his

summary dismissal.

The plot is a deal more complicated than that. Mr Fyfe, a chairman who

wants to be his own chief executive, made it clear even before he took

up office that he thought Mr Peterken should leave. It seems likely that

the board agreed a severance package with Mr Peterken and submitted it

to the Scottish Office. Unfortunately, because of the Public Accounts

Committee's recent strictures on the conduct of the Welsh Development

Agency, the Treasury has issued a number of new guidelines for the

public sector. These include a general prohibition on golden handshakes,

and the Minister, Lord Fraser, appears to have advised that there was no

legal basis for authorising Mr Peterken's presumably generous deal.

The summary dismissal, carried out while Mr Peterken was in London,

may have done him a rather odd favour. It may have created a legal

liability on the part of the health board, and given Mr Peterken a good

case in law for compensation. Thus it may have the effect of

circumventing the Treasury rule. A further embarrassment for the

Government is in the fact that Mr Fyfe's own company in Ayrshire was put

into receivership and then sold on. It hardly augurs well that the man

brought in to instil sound business practices in the health service

should have found himself presiding over such a messy dismissal. Mr

Peterken is an unlikely hero of the Labour Party but its MPs cannot be

expected to deny themselves the inevitable schadenfreude. A full

explanation is required, and Mr Fyfe must consider his own position.