Government education agency mired in mismanagement, lacks audit trails

Persistent weaknesses in attendance records, payments and staff leave controls remain at the Foundation for Educational Services, despite efforts to address shortcomings first identified by the National Audit Office several years ago.

An NAO follow-up examining the government-run Klabb 3-16, SkolaSajf, and Afternoon School Programme found that, while improvements have been made, significant weaknesses in control remain.

Overall, only one of six recommendations was fully implemented, two were partly implemented, one showed significant progress, and the other two showed only insignificant progress. The NAO gave the FES an overall implementation/progress rating of 67%.

One continuing problem concerns the audit trail for attendance and payments by parents using Klabb 3-16.

The FES introduced revised procedures to deal with parents whose accounts fall into arrears, including automatic reminders when balances fall below the equivalent of 15 hours, or €12.

However, the NAO found that no audit trail is retained showing when reminders were sent, how frequently they were issued or who received them.

As a result, auditors could not verify whether the FES was actually following its own procedures.

A February 2026 report showed outstanding balances at the end of September 2025 of €16,478.

Attendance controls also remain problematic.

While information generated through the FES system allowed auditors to reconcile recorded attendance, absenteeism could not be independently corroborated because supporting documents, where available, were retained by individual centre coordinators and were not accessible to head office.

The Foundation has started moving towards digital attendance monitoring, with a pilot system introduced at the Mġarr Klabb 3-16 centre during the 2025/2026 scholastic year. But the NAO said significant challenges concerning the absence of an adequate audit trail and controls over attendance records persisted.

Auditors also uncovered deficiencies in the administration of employees’ vacation leave.

An SOP setting rules for vacation leave was introduced in November 2024, but the FES could not provide the leave forms for two employees sampled by auditors.

In other cases, employees carried forward vacation leave exceeding established thresholds without the necessary evidence of management approval.

For three sampled employees, the documentation consisted only of screenshots showing that requests had been submitted, without the corresponding management approvals. Auditors also found discrepancies between the leave initially requested for transfer and the higher amounts eventually carried forward.

In another case, neither the employee’s request nor management approval could be produced.

The NAO acknowledged that the Foundation had introduced corrective measures and new policies.

It nevertheless concluded that “significant challenges persist”, particularly over missing audit trails and inadequate controls surrounding attendance records.