By GEORGIA EDKINS, SCOTTISH ASSOCIATE EDITOR FOR DAILY MAIL AND THE MAIL ON SUNDAY
Scotland's Auditor General could launch a probe into NHS Fife, The Mail on Sunday can reveal.
In an exclusive interview, Stephen Boyle refused to rule out taking a deep-dive into the health board's finances and governance structures.
It comes as Scottish Conservative leader Russell Findlay last night demanded First Minister John Swinney 'sack' NHS Fife's CEO and board if they did not 'do the right thing and quit'.
Sandie Peggie, 51, was suspended from her role at Victoria Hospital, in Kirkcaldy, last year after she objected to 30-year-old male-born Dr Beth Upton using the female facilities.
She is also suing the Royal College of Nursing union, a fact first revealed by MailOnline in May.
Last night, Mr Boyle - who assesses public bodies' value for money as well as their governance structures and accountability - said he would make a decision on whether to probe NHS Fife after his auditors complete their usual reports.
Asked about the use of taxpayer funds to pay for legal costs relating to the tribunal so far, Mr Boyle said he understood why the public might be concerned over the spending.
He said: 'Without commenting on the specifics of the case... I understand across the piece why the public will want to be satisfied absolutely that public money is spent properly consistent with the roles and responsibility of public bodies who are tasked with implementing government policy.'
Auditor General Stephen Boyle said he would wait for his auditors' report before making a decision on launching an investigation
Chief executive of NHS Fife Carol Potter has been urged to resign by Scottish Tory leader Russell Findlay
Probed over whether he had concerns NHS Fife might not be complying with the law on single sex spaces - clarified by a Supreme Court ruling that a woman is defined by her biological sex in April - he said he would await the auditor's usual report of the health board.
He said: 'How I discharge my responsibilities, particularly when it comes to individual public bodies, is through the annual auditors. I appoint auditors for all public bodies, with the exception of local government and they'll conduct an audit of the expenditure.
'In public sector context, we don't just look at the numbers; we also look at governance, accountability and value for money, and I'll await the auditor's report.
'That's something that they will refer to, and it's something that I can then take a decision, as I do in many cases, whether to proceed with a statutory report to the Scottish Parliament on the back of that.'
And pushed on whether he will investigate NHS Fife's handling of the case, he said: 'It's not something I have made a decision on yet. I will await the auditor's report.'
Mr Boyle's comments come after Scottish Tory leader Mr Findlay yesterday said the tribunal was unfolding like an 'ongoing slow-motion car crash'.
Nurse Sandie Peggie was suspended after she objected to trans medic Dr Beth Upton using the female facilities
Furious Russell Findlay has said if NHS Fife bosses do not resign, John Swinney should sack them
He said NHS Fife's chief executive Carol Potter, who earns at least £147,700 a year, and her 'entire board can no longer remain in post'.
And he condemned a media statement released by the health board on Friday evening which took a swipe at human rights organisation Sex Matters, which is supporting Mrs Peggie.
The statement read: 'Sex Matters have been very active, making statements which it would appear are aimed at steering public opinion in a way that NHS Fife as a public body clearly cannot.'
It added: 'There has been significant and very polarised debate on social media regarding the case and associated issues, throughout. In some cases, however, what began as debate has evolved into much more worrying behaviour, including a threat of physical harm and sexual violence, which has required the involvement of Police Scotland.'
NHS Fife later tweaked the release, adding: 'NHS Fife is not seeking to suggest that anyone involved with Sex Matters have contributed to the behaviour or issues mentioned above.'
However the move backfired spectacularly, drawing criticism and ridicule in equal measure.
Dr Beth Upton, born a biological man, is a respondent in the landmark employment tribunal
First Minister John Swinney is sticking to his position that he still has confidence in NHS Fife
Last night, Mr Findlay said: 'In their zeal to embrace the SNP's bonkers belief in gender ideology, they were willing to destroy the career of a nurse and waste huge sums of taxpayers’ money.
'But instead of taking any responsibility for their own conduct, they’ve now resorted to smearing Sandie Peggie and the campaigners who have stood with her.'
He added: 'John Swinney, Neil Grey and their SNP colleagues appear to be the only people left in Scotland who think this is okay.
'If the NHS Fife board won't do the right thing and quit, then they should be sacked.'
NHS Fife's statement also made reference to a freedom of information battled between the health board and The Mail.
However that also caused concern, and sparked a warning from the Scottish Information Commissioner David Hamilton who said it had cast doubt on its compliance with FOI legislation.
In May, he ordered NHS Fife to review what information it held about its legal bill for the tribunal after it failed to supply the costs to The Mail.
Earlier this month, NHS Fife published data saying the case had cost £220,500 as of the end of May - although that had soared to £258,831 by the end of June.
Mr Hamilton said: 'The petulant tone of NHS Fife's latest statement is quite remarkable, but it is the contents that concern me most. They have now cast doubt upon the assurances they gave me regarding compliance with my Decision Notice.'
If the authority had not complied, he said he may 'report the matter to the Court of Session as a contempt of court'.
According to the health board's communications policy, Press releases are approved by the 'relevant Executive Director and Chief Executive before release', meaning Mrs Potter was likely aware of the statement.
The tribunal battle between the veteran nurse, the health board and the doctor continues.
A Scottish Government spokesman said: 'Ministers have been clear they have confidence in the board. It would however be inappropriate to comment further while judicial proceedings in an Employment Tribunal are ongoing.'
A spokeswoman for NHS Fife said:'To date,NHS Fife has had no contact from the Auditor General on this matter.'