Transport Minister Humza Yousaf (right) said Phil Verster (left) did not quit over a funding clash
The embattled Transport Minister said it was "crass" to suggest Mr Verster's sudden departure was linked to the £3 million giveaway for passengers.
Mr Verster announced last month he was stepping down ScotRail Alliance managing director to take up a post at the East West rail project in England.
He told a Holyrood committee he "couldn't vouch" that the discount scheme would go ahead as this could mean postponing other initiatives.
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But Mr Yousaf insisted there was no "disagreement" over the use of the Service Quality Incentive Regime (Squire) fund – built up from penalties imposed for failing to meet standards.
This will provide £1.8million and the Government only £1.2 million.
Last month Mr Verster told stunned MSPs there was only around £1million in the Squire pot and it was up ScotRail how to use it.
He said it was 'crass' to suggest the resignation was linked to a free rail fare scheme
But challenged on the issue Mr Yousaf told Holyrood's connectivity committee he had used "incorrect" figures, and the fund actually sits at £2.06 million.
The insinuation is the absolutely incorrect one
He also suggested Mr Verster had been "speaking from memory" and probably did not have "a photographic memory of the contract in his head".
But Lib Dem MSP Mike Rumbles said the rail boss had been "quite clear" about the funding position.
Mr Rumbles said: "This £1.8 million he said he had, quote, 'not agreed to' and then 48 hours later he resigns.
Mr Verster had told a Holywood committee he 'couldn't vouch' that the discount scheme would go ahead
Lib Dem MSP Mike Rumbles said Mr Verster had been 'quite clear' about the funding position
"Now you come to the committee to say, and I quote you again, 'we have the funding already in place'."
He added: "I'm actually making a point to you which I'd like you to address.
"I'm trying to get to the facts here. Phil Verster comes to the committee makes that point. You've come to the committee, make the opposite point.. There's obviously a disagreement between the two of you."
But Mr Yousaf said: "The insinuation is the absolutely incorrect one.
"It is absolutely unfair to make a suggestion that because after Phil Verster's coming to committee that somehow he resigned as a result of that, that was the insinuation you were making – an absolutely incorrect one, an absolutely false one to have made and I think frankly a crass one to make as well."
On the use Squire cash Mr Yousaf said "contractually" it was up to ministers but quango Transport Scotland and ScotRail "will come to an agreement on where to spend that money".
Earlier, Mr Yousaf announced further details of the travel scheme which comes after months of train delays and disruption.
Monthly and annual season ticket holders will gain a free week of travel, with free off-peak return trips anywhere in Scotland for those who switch to smart ticketing.
Weekly season ticket holders on Smartcard will also benefit from a complimentary one-day return ticket, with an offer for leisure passengers to be announced later in the year.
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