The Auditor General reported to Parliament on an enquiry requested by three Members of the Public Accounts Committee in August 2008 on outsourcing at Mater Dei Hospital of clerical/reception services, as well as security, car park and traffic management services. The request proposed that the Auditor General examines both financial and compliance, as well as value-for-money issues related to the contracts in question.

The enquiry found that the migration to Mater Dei Hospital in 2007 put pressure on the health authorities to engage additional clerks and ward clerical assistants to fill vacancies accumulated over the years at St. Luke's Hospital, as well as to take a decision to outsource these services. The approval to issue a call for tenders for the outsourcing of clerical/reception services was sought after the publication of the advert requesting firms to submit their offers. Timely arrangements were not made to issue a fresh call for tenders, resulting in the tender being extended on several occasions.

Soon after the opening of the new hospital, the government decided to reduce the car park rates due to social considerations. A service concession contract for the provision of external security, car park and traffic management services had already been awarded and the changes in the parking rates led to new arrangements. A key concern for the government was how to make these changes in the shortest possible timeframe while at the same time ensuring continuity of service. The National Audit Office found that more effort could have been directed in the evaluation and negotiation of new contractual conditions or other options that could have been pursued by government in order to ensure that value-for-money is achieved.

Internal security services at Mater Dei Hospital were also outsourced after a decision was taken to retain existing permanent security personnel at the St. Luke's Hospital site. The National Audit Office found that an excessive number of security staff was retained at St Luke's Hospital and, although measures have been taken to reduce the staff complement, this number needs to decrease further once identified obstacles are addressed.

Internal security services at Mater Dei Hospital were outsourced two months prior to the submission of the request for direct order approval and six months prior to the signing of contract. The approval to extend the original internal security services contract was granted five months after the termination of such contract.

The National Audit Office found limitations in contract management. These included missing, incomplete or inconsistent information relating to the provision of clerical/reception and internal security services, limited verifications carried out prior to effecting payments, as well as the need to develop a more comprehensive system for monitoring the performance of outsourced services. Payments effected in respect of internal security services were not always covered by the necessary authorisations, mainly because of a miscalculation in the budgeted contract cost and the delay in approving the correct contract amount. Revenues relating to staff parking fees were not being endorsed by the Mater Dei Hospital management, whilst the company providing the external security service did not adhere to the minimum number of security guards requirement as stipulated in the service agreement.

The hospital management has indicated that it will take action to address issues raised by the National Audit Office.