Report 106 - Supplementary Report - Kildare and Wicklow Education and Training Board Financial Statements 2015 - Lapses in controls over procurement of capital projects and certain other expenses
Published on 13 February 2019
The audit by the Office of the Comptroller and Auditor General of the financial statements of Kildare and Wicklow Education and Training Board (KWETB) for the year ended 31 December 2015 identified concerns about procurement, project cost overruns and propriety matters. A formal query on these matters was issued to KWETB in June 2017. The information and supporting documentation provided by KWETB in response to the query were inadequate. Consequently, the matters of concern were brought to the attention of the Chair of the Board of KWETB and the Department of Education and Skills.
The Comptroller and Auditor General issued his opinion on the 2015 financial statements of KWETB on 24 December 2018. A supplementary report, as provided for by section 7(4) of the Comptroller and Auditor General (Amendment) Act 1993, was also issued.
In summary, the key concerns identified by the audit are as follows
- There were weaknesses in KWETB’s procurement processes.
- Contracts were awarded to a firm with connections to the (then) Chief Executive, and were not disclosed.
- KWETB rented an industrial property in 2015 which was subsequently partially licensed to the same firm connected to the (then) Chief Executive. There was inadequate documentation of the on-licensing arrangements — rent and service costs were only paid to KWETB after concerns were raised by the audit.
- KWETB disposed of a van in January 2017, but received no payment until after audit queries were raised. In addition, a full year’s motor tax was paid by KWETB just before the disposal occurred.
- Poor contract management practice contributed to additional costs of €483,000 regarding the construction of Arklow Community College.
- In April 2015, modular classrooms were installed in Naas Community National School at a cost of €206,000. These classrooms were relocated to Maynooth Post Primary School three months later at a cost of €73,000.
- KWETB incurred significant expenditure with certain hotels without a competitive procurement process.
The lack of evidence available from KWETB to support procurement processes is concerning, and indicative of poor control. Furthermore, there are serious concerns as to the overall integrity of procurement by the Board due to
- the use of reduced deadlines for the submission of tenders
- failure of successful bidders to meet minimum required standards in respect of contractor’s annual turnover and experience, and
- errors, inconsistencies and lack of supporting information for scoring tenders received.
The report concludes that the Board was unable to challenge the executive in an effective way during 2015. Underlying causes for this include incomplete information being provided to the Board, delay in the establishment of statutory sub-committees and a lack of internal audit resources. An effective process for review of internal controls was not in place. Additionally, KWETB did not actively pursue the non-submission of declarations of interest, nor did it critically review the content of declarations.
More generally, while a key function of the Boards of ETBs is oversight of their executives, they are heavily dependent on their executives in the exercise of that function.