Board admits breaking rules by paying firm €1m

THE Southern Health Board has admitted paying out over €1m to a management consultancy firm two years ago in breach of statutory regulations.

SHB chief executive officer Seán Hurley accepted yesterday the SHB was wrong to have engaged a firm of consultants between 2001 and 2002 without holding a formal competition, as required by EU law.

Although the firm was not identified, it is understood to be Dublin-based Prospectus Strategy Consultants.

The Comptroller & Auditor General, John Purcell, told the Dáil Public Accounts Committee yesterday an audit of SHB’s accounts showed the board had departed from public procurement guidelines in breach of EU regulations.

Mr Purcell also expressed concern there was no evidence that SHB management had formally considered whether to engage consultants or use its own in-house expertise. The CA&G believed the board could have been expected to have the appropriate resources to deal with the matters.

However, Mr Hurley claimed the board did not have its own resources to carry out work done by the consultants - a project devising a strategy for acute hospitals in Cork. He said the board had seen its hiring of the consultancy firm as an investment because the SHB was engaged in a learning project on how to modernise its operations.

He insisted he was more than satisfied the board had obtained “very significant value for money” which had been his “overriding ambition” in hiring the firm.

As a result of the work done by the consultants, Mr Hurley said he believed the SHB had the best management process systems within the country’s health board network.

However, Fianna Fáil TD Seán Fleming said it was “a black mark” against the consultants that they were unaware themselves of the EU regulations on tender procedures.

The CA&G said he wanted to scotch the impression that public procurement rules and value for money were “mutually exclusive.”

Mr Purcell also expressed concern that the board had incurred capital expenditure for which funding was not available of almost €24.5m in its 2002 accounts.