Belfast Telegraph

Deluge of muddy water for PAC to wade through

The NI Water story is swamped by rumours, leaks and hype. The Assembly’s watchdog public accounts committee has its work cut out, says David Gordon

Amid all the noise about the NI Water story, it is clear that senior people at Stormont have some very important work to do in the weeks and months ahead.

There will be separate tasks for MLAs and top civil servants. That’s because there are distinct strands to the expanding controversy. There is the suspension of Paul Priestly, permanent secretary of the Department for Regional Development.

Then there is the procurement issue — the multi-million pound contracts handed out by NI Water in breach of government rules on competitive tendering.

Thirdly, there is the way Mr Priestly’s department dealt with the procurement problems.

An independent review team (IRT) was set up in January to examine the evidence.

Its report led to Regional Development Minister Conor Murphy dismissing four part-time directors from NI Water’s board.

The Assembly was told last month that, in addition, four NI Water employees are facing disciplinary action over the contract failings.

There has been criticism of the IRT process and whether it was independent — as noted by the Assembly’s regional development committee last week.

These three issues — the Priestly suspension, the procurement failings and the IRT process — make up the bulk of the story so far.

It has been complicated by rumours, leaks, conspiracy theories, party politics — and some hype.

The challenge facing those in the corridors of power is to sort it out rationally and calmly.

On Paul Priestly, it falls to the senior civil service to deal with his suspension.

It has been announced that an inquiry will be carried out and it seems likely that this will be headed by an individual from outside Northern Ireland. A retired senior civil servant, or legal figure from across the water may get the call.

This inquiry can presumably only concentrate on the actual reason for Mr Priestly’s suspension. This was solely to do with him helping to write an angry letter to the Assembly’s public accounts committee last month.

This letter came from IRT member Peter Dixon and objected in furious terms to some PAC members questioning his independence.

Civil servants like Mr Priestly are supposed to show utmost respect to the PAC — the Assembly’s watchdog on how taxpayers’ money is spent.

He has also caused embarrassment to his minister, who was defending him over other issues involving the IRT process.

On the procurement issue, the PAC has been examining the contractual practices at NI Water and was planning to issue a report in October. It will surely now require more time than that.

NI Water has admitted that more than 70 contracts — worth some £28m in total — were not awarded in line with long-established government rules.

These included single-tender actions, where only one company was given the chance to secure the work. It also involves failures to secure senior-level approval for such contract decisions.

Procurement is a dry and |technical issue and there have been attempts in some quarters |to downplay the significance of the £28m figure. It is not the |case that this money has been lost, or the work not carried out. But without competitive tendering, it is impossible to say that value for money has been obtained for taxpayers. That’s why the rules are there.

They also protect public bodies from legal action from aggrieved contractors who did not get the chance to bid for contracts.

No one has stressed the importance of the rules more than |the Assembly public accounts committee.

In a report last year, it stressed that “robust procurement procedures safeguard public funds”.

It also said: “In particular, |ensuring that there is genuine competition between contractors, and that contracts are fairly awarded, is essential in achieving value for money.”

On the question of the IRT, it remains to be seen if it will be the public accounts committee which looks into all the issues.

The IRT’s independence has been called into question — not least over the representations made to the three-person panel by Paul Priestly before it finalised its report.

The IRT, in fact, also received submissions from NI Water’s board.

Like Mr Priestly, the board suggested changes to the wording of the first draft.

This is not unusual — official reports often go through a clearance process, with departments and others offered the opportunity to comment and make the case for revisions prior to publication.

So a new review would presumably have to examine all the representations and evidence the IRT considered, as well as the make-up, terms of reference and conclusions of the panel.

It may also have to assess whether Mr Priestly overstepped the mark with his representations, or was simply defending his department on where blame should lie for the procurement failings.

The IRT report actually made some sharp criticisms of the department, while placing the primary responsibility with NI Water’s board and senior bosses.

Will the public accounts committee be in a position to review that verdict and the minister’s subsequent decision to remove the board members?

And if not, who will?

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