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The Housing Executive failed to properly tackle the potential for fraud and shoddy workmanship, according to a hard-hitting probe into multimillion-pound maintenance contracts.
The Audit Office report found that the Northern Ireland Housing Executive (NIHE) failed to sufficiently challenge poor work and left itself open to major losses in maintenance contracts worth a total of £200 million between 2006 and 2011.
The report raised further concerns over a wide range of issues, including the treatment of whistle-blowers and findings that senior management was resistant to negative internal audits and suppressed a critical report on the disposal of land.
Audit Office officials noted how in 2011 the Housing Executive cancelled contracts with the Red Sky construction company which were worth an annual £7 million, but the report found the crisis was the culmination of a series of investigations into the firm's relationship with NIHE that could be traced back to the mid-1990s.
On the wider management of the maintenance contracts, the report said: "Based on our findings, and in the absence of concrete evidence to the contrary, we can only conclude that, for many years, there has been a very significant risk to value for money in response maintenance expenditure.
"Indeed, the weaknesses in assessment, reporting and management oversight of contracts, particularly at a high level within NIHE, left the organisation exposed to impropriety and fraud.
"While poor contractor performance had been evident to NIHE management for many years, the Audit Office found that the actions necessary to strengthen the contract management regime were not taken."
The Audit Office found the reporting of serious concerns within NIHE was poor. Of the 22 ongoing investigations of suspected fraud in NIHE during 2010-11, only two had been formally notified to the Comptroller and Auditor General. The report found a perception that staff who raised concerns had not always received the protection required.
Kieran Donnelly, Comptroller and Auditor General, said: "Over the five years to 2011, the Housing Executive has spent more than £200 million on response maintenance. My review found serious weaknesses in the management of the contracts governing this expenditure.
"However, I welcome the Housing Executive's acceptance of the recommendations contained in my report and its introduction of wide-ranging changes to deliver improvements. These are essential if tenants are to receive a quality service and taxpayers are to receive value for money."
