Education board contracts given to firms with family links to chief executive - watchdog reports
Breaches in procurement guidelines and other criticisms of the operation of Kildare and Wicklow Education and Training Board (KWETB) during the tenure of former chief executive Sean Ashe are highlighted in a report from the State spending watchdog.
One of the key concerns surrounded contracts awarded to a firm with connections to Mr Ashe, which he did not disclose.
The report provides details of a number of contracts awarded for heating, boiler upgrade and boiler and plant maintenance.
They were awarded to a contractor where the then-chief executive declared, after the Comptroller and Auditor General (C&AG) audit was underway, that a family member had an interest.
It is the final report of the C&AG into lapses in controls over procurement, cost overruns and other financial matters at KWETB, which first came to light following an audit of the board’s financial statement in 2015.
Subsequently, the Department of Education ordered a separate investigation, conducted by Richard Thorn, president emeritus of Sligo IT.
Following its publication last year, then education minister Richard Bruton used a legal power to formally instruct KWETB to improve its governance.
Certain matters have been referred to the Garda Economic Crime Unit and a spokesperson said the investigation is ongoing.
The C&AG said the sole and exclusive focus of his report was KWETB and “for the avoidance of doubt this report does not make any criticism or comments, whether express or implied, with respect to staff members or any third party”.
Sean Ashe, who was chief executive of KWETB when the matters came to attention, retired in December 2017.
According to the report, the lack of evidence available from KWETB to support procurement processes was concerning, “and indicative of poor control.”
The C&AG also had “serious concerns as to the overall integrity of procurement 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".
It also gives details of how KWETB rented an industrial property in 2015 which was subsequently partially licensed to the same firm connected to Mr Ashe.
“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,2 it states.
Other key concerns highlighted by the C&AG are:
* 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.
In relation to the hotel expenditure, the report states that during 2015, KWETB spent €61,550 on hotel,s with one third going to a five star hotel and golf resort - including €10,540 for one event, which it states, “appears excessive.”
In relation to the event costing €10,540, there was no list of attendees maintained, irrespective of the distance travelled, the cost paid included full board accommodation and there was no evidence of quotes received prior to procurement.
The report also concludes that the KWETB 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," it states.