AN official probe into a bonus culture at Scotland's biggest conference and music venue has criticised directors for paying themselves extra for doing their basic job.
The report said the chief executive of the Scottish Exhibition and Conference Centre (SECC) was rewarded for having "a very testing year".
Glasgow City Council, which owns 91% of shares in the SECC, ordered Deloitte to review a system of lucrative pay incentives dating from 2005 after directors were compelled to reveal their bonuses to comply with new legislation.
The accountancy firm found that although one-quarter of the targets for the SECC's chief executive John Sharkey were not met last year he received £85,000 on top of his basic salary of £190,000, as he had had a "very testing year".
His performance was then recorded as "on target", with Deloitte claiming the SECC's system "can make the assessment of performance under the plan less transparent".
The report states that after the SECC's chairman Sir Ian Grant claimed in 2008 financial targets were "now undeliverable or outdated", a "more arbitrary approach" was used to agree the bonus for both the CEO and the executive deputy chairman.
Crucially, Deloitte claims annual bonus performance targets "seem to be based on day-to-day roles", citing the finance director's reward for having accounts cleared by auditors.
Deloitte also claims the number of performance measures at the SECC "seems to be high, which may indicate that the scheme is overly complex".
Recent accounts for 2011-12 show the five top executives at Scottish Exhibition Centre Ltd (SECL) were awarded bonuses totalling £226,882 last year, equivalent to just over one-third of their combined salaries.
The bonuses are of two kinds: performance-related pay (PRP) and a long-term incentive programme (LTIP), effectively a retention bonus used to reward employees for staying with the firm.
The previous year, 2010-2011, Mr Sharkey's PRP was £51,000, or 30% of his then salary, and his LTIP £25,500.
The city council, accused by the SNP of failing to notice the bonus culture, was livid when details of the payments were revealed in the summer, claiming it expected more restraint given the current economic climate, putting more councillors on the board and commissioning the Deloitte report.
Since 2009, it has had more than £30 million in grants to fund expansion plans, and in 2010 the city council was forced to save the new National Hydro Arena, with a £40m bailout after a private sector partner pulled out of the scheme.
It is now expected bonuses will go down next year, with Sir Ian Grant due to attend a council committee to discuss going forward next week.
A council report on Deloitte's findings states: "The report has been considered by SECL. They have advised that while they consider the current remuneration packages and performance incentives are proportionate to support the development and expansion programme of the company, including the new Hydro Arena, they will be reconsidered and replaced on their expiry to reflect the strategic objectives of the company."
One council source said: "You can bet by the time of the remuneration packages next year the bonuses will be down."
The council's SNP group's finance spokesman, Norman MacLeod said: "This report clearly shows the council took its eye off the ball when it came to scrutinising the SECC."
Sir Ian Grant said: "It is unfortunate that in compiling their report Deloitte did not take the opportunity to speak with myself or any members of the remuneration committee, which would have provided a better understanding of the remuneration strategy and its implementation."
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