Northern Trust under fire for bending rules in contracts worth £6m
A damning report has detailed 14 years of inappropriate dealings with contractors for the Northern Trust.
Despite saying he has "serious concerns", Health Minister Edwin Poots has been slammed by the SDLP for taking almost two years to publicly respond to concerns raised by two whistleblowers.
A special investigation by the estates service of the Northern Health Trust found that almost £6m of maintenance work carried out by contractors was not properly accounted for.
However, allegations made by a whistleblower that contracting a former trust employee was inappropriate were dismissed.
It found that it was permissible for the ex-staff member to provide services to the trust, despite being retired on ill-health grounds, and that the rate charged per hour – £40 – was reasonable.
Allegations of potential malpractice were made by whistle-blowers in 2011 and 2012.
The subsequent investigation concluded that there was "no clear evidence of fraudulent activity" or no incidences of contractors being paid for work they did not do.
The auditors did identify a series of weakness in the estates management function of the trust that meant it could not be established if expenditure on maintenance contracts represented value for money.
The Northern Trust has been issued with 72 recommendations to mend its ways.
Mr Poots has announced an independent review into the issues raised by the internal report, but said he believed the trust had made "significant progress in implementing the recommendations to date".
He said audit checks would be carried out across the other trusts to ensure similar practices were not occurring elsewhere.
"Where wrongdoing has occurred it must be addressed, with a proportionate and appropriate response," he said.
SDLP MLA John Dallat said he was "astounded and appalled" that the report came almost two years after the whistleblowers came forward.
"The Northern Health Trust has been aware of the whistleblowing allegations since February 2012," he said.
"The fact it has taken 23 months to complete a report is, in itself, deeply worrying."
He also called for an inquiry to be carried out by the Northern Ireland Audit Office.
"The fact that £5.7m of public money has not been subject to appropriate controls or procurement is not just a matter of serious concern for the minister, it is a serious concern for taxpayers and other contractors who were deprived of the opportunity to tender for this work through the proper procurement process," he said.
Ulster Unionist MLA Roy Beggs praised the whistleblowers for coming forward and demanded to know who'll be held accountable.
"The Northern Health Trust is under extreme pressures and management must ensure that value for money is obtained from every pound," he said.
Sinn Fein MLA Oliver McMullan added that there were serious questions to be answered by the Northern Trust.
"The minister needs to take action as it is obvious the current management oversight mechanisms are not fit for purpose," he said.
What the report found:
Single tender actions without formal approval.
A contractor working without a contract for years.
Contractors used outside of their contracted areas.
Documentation was missing to verify expenditure.
Lack of checks on work carried out and on invoices.
Contracts completed in excess of tender quotation.
Key points from the alarming investigation
£3,128 was paid to Contractor 1 as part of a decontamination scheme without competition. Furthermore, £74,540 was paid to Contractor 1 relating to the medical technician accommodation at Causeway Hospital without competition.
There is no evidence that the services provided by Contractor 1 relating to maintenance, aids and adaptations in the Causeway area from 1999 to the present were subject to any competitive process.
The refurbishment of Whiteabbey Health Centre scheme was inappropriately funded from revenue rather than capital.
Expenditure on the ambulatory care scheme at Causeway was in excess of £30,000 and was not appropriately procured in line with PGN 04/12 (Procurement control limits and basis for contract awards).
Of the sample of 40 invoices reviewed, there was no evidence of measurement of the work and labour was not recorded on the labour management system, as specified in the day works contract specification.
In the sample selected, there was no evidence to support that the quality and appropriateness of the work, hours charged and labour used was confirmed in advance of payment being made. There was no evidence available to confirm that spot checks were performed either by trust staff or quantity surveyors used.
There is evidence the assistant director of estate services, the head of building and estates SMT were aware in 2009 of concerns over legacy Homefirst and Causeway procurement/ contract management.
Various memos, reports and discussions illustrate concerns being escalated as far as the assistant director of estate services. Senior management were aware of the absence of a contract with Contractor 1 in 2008.