MPs are calling on former senior executives at the Serious Fraud Office (SFO) to return severance payments which it says were made as part of a 'catalogue of errors' amounting to 'a case study in how not to run a public body.'

The Public Accounts Committee (PAC) has published a report examining how the SFO's former director Richard Alderman discharged his responsibilities as an Accounting Officer, including his actions over a range of redundancy and severance arrangements made to senior staff.

These included issuing the SFO's CEO Phillippa Williamson with a contract specifying her place of work as her home address in the Lake District. She spent three days a week at the SFO's London offices, receiving payment of nearly £100,000 for travel and hotel costs between 2008 and 2012. The report described these arrangements as 'quite astounding'. Williamson also received a pension enhancement of over £400,000 which went ahead without Cabinet Office approval.

The report says Alderman signed off 'special severance payments' of £15,000 to Williamson and the SFO's former Chief Operating Officer with the aim of avoiding grievance action, even though legal advice suggested this was not necessary, and without seeking approval from the Treasury.

Richard Bacon, a member of the PAC, said Alderman's decisions 'showed a disregard for the proper use of taxpayers' money and a woefully inadequate grasp of the importance of "Managing Public Money", HM Treasury's guidance document on the role of an Accounting Officer. By deciding the size of severance packages, and not seeking alternative placements for staff, he failed to follow due process.'

Following the PAC hearing, at which he gave evidence, Alderman wrote to the Committee to apologise and acknowledged that his actions fell short of what is expected from an Accounting Officer.

Bacon said the SFO's new director, David Green, should explore 'all possibilities to minimise the cost to the taxpayer' of Alderman's actions, including requesting that the recipients of special severance payments repay the money.