A service provider for electrical works for JobsPlus has been doing jobs for the agency on a direct order for 10 years.
It came to light in a report by the Auditor General, whose office questioned an invoice of €35,500 that was “not substantiated by agreements or quotations… no details of the work carried out were included, but the description only stated that they were electrical works.”
When the NAO questioned it, the Office was essentially told it was how things had been done for the last decade.
The report on public accounts assessing government expenditure in 2023, published this month, shows that JobsPlus has regularly bypassed public procurement rules on projects.
The Auditor General found that JobsPlus had issued separate quotations for the same project, even though all work was given to the same contractor.
This was done repeatedly for several projects managed by the agency. It was done to avoid exceeding the €10,000 threshold on direct orders, which would necessitate a tender.
The NAO said the agency bypassed procurement rules on a number of projects where costs “were split to bypass the provisions of public procurement rules and avoid the stipulated thresholds.”
“Maintenance works carried out on Block E, comprising roof replacement, tile laying, sanding and plastering, were all treated separately, despite all tasks given to the same contractor for a total of €24,850, after obtaining separate quotations for each job to remain below the €10,000 threshold,” is one of the examples in the report.
Other projects in which the same method was used include research and report writing services costing €22,420, IT assessments and training costing €15,000, and another €21,240 on web hosting fees, which are far beyond the market rate.
A service provider for palm pesticides and felling charged the agency €33,078, at times invoicing twice a month with nobody noticing.
“In the majority of cases reviewed that required a public call, the entity resorted to service providers of its own choice rather than opting for a call for quotations, significantly limiting the competitive bidding,” the report states.
Cleaning services charged at overtime rates, costing €3,100, were “an extra service provided upon the verbal request of the CEO,” the report adds to a list of transgressions reported at the agency.
Despite the centralised Procurement and Purchasing Control Unit, individuals at JobsPlus were contacting and engaging suppliers directly for works and services even when the amounts involved required the Procurement and Purchasing Control Unit’s intervention.
“Bypassing the established controls will render it completely ineffective, leaving the entity exposed to various risks, including unauthorised purchases and overspending. Moreover, it creates gaps in financial records and a lack of audit trail over the procurement itself, including authorisation. This also complicates the process of reconciling payments against delivered goods and services.”
JobsPlus has had a number of CEOs in recent years. Former Mater Dei Chief Celia Falzon was appointed CEO in August. She replaced the now PL CEO Leonid McKay who only held the position for a few months this year. The former CEO at JobsPlus was Alexia Vella.
The Auditor General recommended that JobsPlus ensured a full audit trail of each financial transaction, enabling independent verification. Services are to be duly supported by a valid agreement that includes the applicable rates, among other terms.
A staggering €38,400 for website support was paid to a private company based on a handwritten note of the billable hours. A progress report had to be delivered with each invoice, but this was never checked.
Lack of enforcement of reporting obligations was also noted with respect to two providers of transport services to Jobsplus employees and clients. Despite the significant costs involved, which since October 2019 amounted to €457,418 and €131,575, respectively, the monthly reports required detailing the list of trips and the type of vehicle used were not being submitted with the monthly invoices.
Despite all the money spent on these transport services, the audit shows “minimal or no usage of the service.” Data analysed between May and October showed that out of 68 morning and afternoon trips, transport was only used on one morning and 11 afternoons by 22 individuals.
In 2023, Jobsplus had accrued expenditure totalling €1,620,534 on its books, mostly on the rental of premises not backed by lease agreements.
In 2023, expenditure charged to the staff welfare account totalled €54,546, of which over €28,000 was incurred as hospitality expenditure extended to staff and Board members. These included catering for a team building event, photobooth services during Christmas lunch, cocktail bar service and ice cream for CEO’s events, and vouchers given to staff as Christmas gifts.
While the CEO approved the expenditure, the endorsement by the Permanent Secretary, as outlined in the Public Service Management Code, was absent.
JobsPlus contribution to the Lino Spiteri Foundation, which provides support to job seekers with disability, increased to €1.6 million from €1.5 million the previous year. The audit noted that JobsPlus went from offering the grant to covering the Foundation’s total reliance on the agency. And again, despite the additional funds by JobsPlus, the lack of record-keeping made it difficult for the Auditor General to assess payments.
The Auditor General said Jobsplus must implement a comprehensive and robust internal control and governance framework to ensure sustainable operational efficiency, risk mitigation and regulatory compliance.
Probably adding to Malta’s record deficit of euro 10 billion without Finance noticing. The absence of basic accountability means that trouble can’t be far ahead. Keep it up boys!