Sloppy record keeping at housing ministry puts public funds at risk

Widespread project management failures at the Ministry for Social and Affordable Accommodation led to potential overcharging and the allocation of contracts based on personal relationships rather than qualifications. 

A 2020 audit by the National Audit Office (NAO) revealed significant shortcomings at the ministry’s Housing Maintenance and Embellishment Company (HME) involving the maintenance of records and financial management.

The NAO’s Follow-Up Audit Report for 2024 found that little to no progress has been made in fixing these problems.

The follow-up audit revealed that inadequate oversight of restoration project contracts led to mishandled tenders, unverified additional work, and a general absence of project supervision.

Contractors did not follow agreed-upon rates, often billing based on estimates rather than actual measurements. This led to payments for work that might not have been completed as claimed. 

The audit also uncovered contracts that did not include performance guarantees. In instances where guarantees were provided, they had either expired or did not cover the entire contract period. 

Other contractors neglected to furnish the mandatory insurance policies, leaving projects uninsured and exposing HME to significant risk.

The HME paid some €84,000 for invoices that were not certified, or were without proper certification and verification by surveyors or architects, raising doubts about the validity of the billed works. 

Contract extensions frequently occurred without proper approval or clear definitions of additional works, resulting in payments that exceeded the original contract values. 

Many invoices violated fiscal regulations by not including the HME’s VAT registration number, leading to suspicions about the proper accounting and payment of VAT.

The billing was also determined using fixed fees for estimated areas instead of precise task measurements. Project variations and final contract prices were not adequately monitored, leading to unsupported charges and inconsistencies. 

HME merged with Social Projects Management Limited (SPM) on 2 February 2024, and new protocols were implemented to enhance compliance, but the NAO found that the application of these changes has been inconsistent.

Contractors are now submitting invoices for finished tasks backed by approved Bills of Quantities. This adjustment is designed to guarantee that payments accurately correspond to completed work. 

Formal letters are now being sent to contractors indicating the start dates and schedules for the work to address the previous absence of formal communication. Measures have also been implemented to ensure that contractor documents bear consistent signatures, and the enforcement of power of attorney requirements is now in place.

Despite these improvements, there are still significant unresolved issues. 

The NAO pointed out that clarity on performance guarantee renewals was lacking, and contractors still providing outdated or irrelevant insurance policies. 

The practice of using direct orders for materials, bypassing public procurement regulations, continues leading the NAO to renew calls for a tender process for regular purchases to ensure transparency and compliance. 

The audit also found that maintenance of a fixed asset register was still being neglected, severely restricting HME’s control over its assets. Many invoices still do not comply with VAT regulations, posing ongoing risks of tax evasion and financial mismanagement.

The NAO audit stressed that these ongoing deficiencies in record maintenance and adherence to regulations puts the efficient allocation of public funds at risk and diminishes public confidence in the administration of vital housing initiatives.

The ministry, led by Roderick Galdes, is at the centre of controversy due to voters registered at housing units still under construction in Siggiewi.

                           

Sign up to our newsletter

Stay in the know

Get special updates directly in your inbox
Don't worry we do not spam
                           
                               
Subscribe
Notify of
guest

3 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments
joe tedesco
joe tedesco
11 days ago

RODERICK GALDES SHOULD BE DISMISSED AT ONCE.

Robert pace bonello is
Robert pace bonello is
11 days ago

Suits the crooks working there and authorising payments just fine. They thrive in such confusion.

Out of Curiosity
Out of Curiosity
11 days ago

Many Government’s Authorities, Agencies and Companies have been created by the Labour Party to accommodate acolyte labourites with no proper academic baggage and expertise to the detriment of public finances. Unfortunately, this is what one should expect when posting crooks and stupid people at the realm of government entities. This is the lavish style of our dearest and the most incompetent prime minister of all times.

Last edited 11 days ago by Out of Curiosity

Related Stories

Roberta Metsola elected European Parlament President with highest ever vote
Roberta Metsola has been re-elected European Parliament President with
Court orders Stagno Navarra to pay his lawyer’s bills
Labour propagandist Karl Stagno Navarra was found guilty of

Our Awards and Media Partners

Award logo Award logo Award logo