Labour turns up heat on scandal-hit BBC governor

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LABOUR will make a sustained attempt this week to remove a BBC governor after the House of Commons Public Accounts Committee made yet more scathing criticisms about the scandal-hit Welsh Development Agency he used to control.

An Early Day motion from Welsh Labour MPs will call on Dr Gwyn Jones to be fired or to resign as chairman of the Broadcasting Council for Wales, another quango post in the gift of the Government.

The post not only gives Jones, the former chairman of the WDA, influence on the BBC in Wales and puts him on the BBC Board of Governors, but allows him a say in the running of S4C, the Channel 4 Welsh service.

Rhodri Morgan, Labour's Welsh Affairs spokesman, said: "After this week, his position is untenable."

The latest attack from the PAC came in a report released last Thursday on complex land dealings by the agency in Aberdare in the Cynon Valley. The committee said it was "very concerned" that the agency had bought land for pounds 440,000 which had been valued at pounds 160,000 a few weeks before.

It took "strong exception" to the way that a valuable site had been sold to Tesco even though the supermarket chain's bid was late and other interested companies were not given the chance to increase offers. The committee was "deeply concerned" that this behaviour was "not fair" and that "preferential treatment" had been given to Tesco.

At the time of the sale Dr Jones was on the board of Tesco. A Tesco board member, David Malpass, was also on the WDA board. The committee noted that a report by the accountants Grant Thornton found no evidence that any official had been involved in "improper pecuniary gain or collusion".

But Labour MPs are not focusing on Dr Jones's behaviour in the WDA, but his attack on journalists who investigated the land deal. Details of the scandal came to light in two documentaries by the BBC current affairs unit in Cardiff.

Dr Jones strongly criticised the programme-makers at a Broadcasting Council for Wales meeting. He did not declare an interest. Nor did two other Broadcasting Council members: Tony Roberts, chief executive of Cynon Valley Council; and Enid Rollands, a WDA employee.

After a furore inside the BBC, the Council responded with a statement saying that in future interests would be declared as "they should have been on this occasion".

Mr Morgan said: "No one would have known about what was going on in Aberdare if BBC journalists had not resisted pressure and fought off attacks from Dr Jones. He is a man who ran an organisation which has been criticised so often by the Public Accounts Committee that it is clear that he should not be able to influence what is broadcast and cannot represent the public interest."

Dr Jones was chairman of the WDA from October 1988 until he resigned in 1993. He was appointed by Peter Walker, the former Welsh Secretary, without references.

The Public Accounts Committee said there was scandal after scandal while Dr Jones was in charge of the agency.

MPs discovered that the agency spent pounds 1.4m more than it should have done on redundancy payments. It also employed a convicted fraudster, Neil Smith, as its pounds 40,000-a-year marketing director. He was subsequently jailed for two years for "forging and then using references and curricula vitae to obtain pecuniary advantage".

An executive who was concerned by what was happening was awarded a pounds 228,000 retirement package on condition he signed a silence agreement. There was "irregular" expenditure on executive expenses and pounds 300,000 was spent on plans to hive off agency work to private companies. The agency did not spell out where the money had gone in its accounts.

Dr Jones gave no indication that he would resign from his present quango jobs. He said that the Grant Thornton auditors found that he and Mr Malpass had no connection with the land deals with Tesco. "I acted with the utmost propriety," he said. "As I took no part whatsoever in this transaction, I am in no position to comment on the way it was transacted."