My last article in this newspaper, published on the Thursday 15 December, dealt with the publication by Transparency International of its annual survey about the perception of corruption and went on to look at some of the most recent claims of corruption on our shores.
My article also tried to draw a clear line between corruption, claims of corruption, and bad governance. While the first two concern mainly the exchange of favours for monetary gain, the latter has more to do with the lack of transparency in public procurement. However, the three are highly interrelated, as bad governance and lack of accountability inexplicitly leads to corruption.
Issues with public procurement are nothing new. Complaints about lack of transparency are common. Of late, such claims were again under the spotlight as the same European Commission has requested Malta to amend its public procurement legislation. More specifically, the Commission has asked Malta to review procedures concerning decisions to award public contracts, clearly stating that it is particularly concerned that the current set of rules do not conform to the Remedies Directive (2007/66/EC), which sets out EU-wide standards to ensure rapid and effective means of redress in cases where bidders consider that contracts have been awarded unfairly. The European Commission has also made it pretty clear that if Malta does not come back with specific measures on how it intends to solve these issues and to ensure compliance with EU public procurement rules within two months, then the Commission may refer this matter to the EU’s Court of Justice. Up till now, Malta has failed to reply to the Commission’s letter of formal notice.
At broadly the same time of this notification and a few days before my last article was published, the National Audit Office published its Report on Public Accounts for 2010. For those that nurture even the slightest interest on the level of accountability and modus operandi with regard to public procedure, this report provided several insights into the severe lack of standards in such matters. The cases concerned all Ministries and Departments, including local councils but of particular interest were those involving the Ministry for Gozo.
During a time when we are constantly hearing about the over-riding importance of fiscal consolidating and on the need to make sure every single cent of public money is well spent, those taking decisions at the Ministry for Gozo thought otherwise. In fact, the Accountant General stated that “goods and services exceeding the threshold of €6,000 were procured direct from the open market without a public call for quotations or tenders and, on occasions, without the necessary approval from the Ministry of Finance.” The NAO also highlighted the lack of through checking prior to disbursement of funds, stating that “substantial monthly payments were not corroborated by additional documentation other than the invoice. As a result, the source of the rates charged could not be determined. Overpayments were also identified during the course of the audit.”
A further case that was highlighted in the report was that no call for tenders was issued prior to the agreement with a local firm to provide laundry services to the Gozo General Hospital in 2007. Furthermore, even when the agreement expired on 31 March 2010, the same firm was automatically re-assigned the service. A similar case involved a consortium responsible for the maintenance of roundabouts. The NAO stated that no documentation was traced substantiating a monthly service amounting to €4,348. The report adds that “the Director Project and Development with the MGOZ as well as the chairman of the Malta Embellishment and Landscaping Project verbally confirmed that they had no knowledge about the source of rate changed.”
Eco-Gozo was also mentioned - at least this time in concrete terms. A consultant, who was paid a total of €21,830 during an approximate 14-month period, was engaged by direct order as a Support Officer, mainly to provide a communication plan for Eco-Gozo. The NAO commented that “notwithstanding the considerable amount, neither was public call for the service made, nor was MFEI’s approval for direct order sought.”
Numerous other issues which are outside the Accountant General remit, and thus do not feature into the NAO annual report, can be mentioned that further confirm the unacceptable way that things are done. There was a particularly interesting case where posts were ‘suppressed’ prior to the publication of results claiming a restructuring of the Ministry when information given in a parliamentary question revealed no such restructuring had taken place.
The fact is that the Ministry for Gozo has managed to perfect a system of clientalism that is probably unrivalled. Through such a system it manages to dish out favours in forms of payments and direct orders as well as through employment and promotion in the public service. The problem is that there is no such thing as a free lunch; hence someone else (you) is indirectly paying for it. On a final note, I would like to forward my sincere festive wishes to the readers of this newspaper.