In its audit of the National Literacy Agency (NLA), the NAO found several irregularities with the working hours of officers and the payments of overtime and allowances.
The audit also revealed that procurement regulations were repeatedly bypassed by issuing several direct orders, including splitting direct orders into separate contracts.
The National Literacy Agency falls under the remit of the Ministry for Education. It was established in September 2014 and aims to promote and enhance lifelong literacy among children, youth, adults, third-country nationals, and persons with learning difficulties.
The agency is government funded and, in 2021, had a budget allocation of €2 million, while another €91,620 was generated from the provision of training, memberships, sponsorships and various programmes the agency provides to the public.
While the NAO praised the initiatives undertaken by the NLA, it found, among irregular working hours and overtime payments related to officers working for the NLA, several instances of irregular procurement practices.
The audit found that the bulk of the agency’s expenditure was related to salaries and resources, which amounted to 88% of the organisation’s budget. The agency was also running at a deficit.
The NAO found how the contract for the services of the executive secretary was continuously extended by direct orders, dating as far back as May 2014 to the end of June 2022, resulting in 11 direct orders, amounting to a total of €169,905.
The audit also found how “in one of the highlighted direct orders, the contract value was €21,003 (VAT excl.), a request for approval from the Ministry for Finance was not made”.
Of the five direct orders that the Finance Ministry approved, the reason for purchasing directly from the open market was only indicated in one case. Only three of the five direct orders were published in the Government Gazette. The contract value was only stated in one instance.
The remaining direct orders were split into five contracts not to exceed the threshold of €10,000, as otherwise, approval by the Ministry of Finance would have been required.
“This resulted in non-compliance with the Public Procurement Regulation […], which states that when calculating the estimated value, procurement is not to be sub-divided”, the report noted.
Similarly, the procurement of an individual providing clerical services at the agency’s Customer Care Unit between April 2017 and June 2022 was split into several direct orders totalling €55,500. In addition, the NAO audit noted how approval from the Ministry for Finance was only obtained once in January 2017, covering nine months, for €10,000.
In a third instance, direct orders have awarded translation, proofreading, lecturing and training services to the same individual since November 2019. The translation and proofreading services were covered by four contracts totalling over €15,000. The NAO, however, notes that this would have required a call for tender in such a case.
The report also states that the amounts charged could not be verified because the rates for lecturing and training were not included in the contracts. The audit then tested four invoices relating to translation and proofreading services, amounting to €7,680 excluding VAT and found that these did not have a VAT number and were not supported by fiscal receipts.
The NAO underscored that the NLA was expected to review all its service contracts, refrain from using direct orders unless in exceptional circumstances and stop sub-dividing contracts, bringing them in line with the legislation governing the public procurement process.