Gardaí probe awarding of hospital contracts
Details of the potential fraud emerged at the Dáil Public Accounts Committee yesterday after a report by the Comptroller and Auditor General highlighted how all the contracts had been won by the same firm.
It also revealed that bogus quotations from non-existent companies had been supplied to create the impression that a proper competition had taken place for the way contracts were awarded.
The CAG, John Purcell, said there was clear evidence of irregularities in the way the hospital’s technical services division operated its tendering process.
The manager of the division resigned in September 2001 following adverse findings contained in several internal audit reports. They showed that money had been paid for systems which were not functioning as well as materials and equipment which had never been installed.
It also emerged that the manager had provided false documentation about his professional qualification as an engineer when he applied for the position at Beaumont in 1997.
Mr Purcell said the hospital had become aware in May 1999 that normal tender procedures were not being adhered to by the technical services division. Subsequently, the CAG said several authorisations for urgent minor repairs appeared to have been issued by the division in order to circumvent the need to issue a public tender for the same work.
A report by an independent firm of quantity surveyors estimated that the hospital was charged €782,180 for work on eight projects which should reasonably have cost less than half that amount.
The CAG’s report said an examination of the division’s tendering process concluded that “in a number of cases, there were reasons to doubt the authenticity of the tenders.”
The hospital’s chief executive, Liam Duffy, told the committee he first became aware of the issue in May 1999 when, in his former position as general manager, he expressed concern to the former employee that work was being commissioned and completed without appropriate documentation.
Mr Duffy said the fact he had identified a problem at that early stage was indicative that he had managed the situation. He claimed irregularities had lasted for several years because there were two separate problems in relation to the tendering process.
However, the CAG said he disagreed with Mr Duffy’s view that the hospital’s internal control systems were working. “They patently didn’t,” remarked Mr Purcell, who said the garda investigation into the matter was continuing.
The PAC also heard that Beaumont Hospital was obliged to pay €1.2m to the operator of its multi-storey carpark. Mr Duffy said the carpark was now operating as originally planned with the hospital receiving annual income of around €750,000.
The CAG expressed concern that consultants using Beaumont’s private clinic were not paying bills for using the hospital’s laboratory services. Mr Purcell estimated this had cost Beaumont €2.7m in lost revenue in the period 1998-2002.
