HSE disregarding procurement rules on goods and services

The HSE has shown widespread disregard for procurement rules when buying goods and services, according to a report from the Comptroller and Auditor General.

An analysis of a sample 100 purchases at three hospitals and three local health offices found that in 36% of cases, appropriate procurement processes were not followed. The value of the purchases in question was more than €1m, representing almost half (47%) of the value of items purchased in the sample.

The C&AG’s finding is particularly significant against a backdrop of an overall spend by the HSE of almost €1.6bn on goods and services in 2013.

If the results of the sample are representative of the whole system, then millions are being spent without proper regard for procurement rules.

The sample analysis also found that, where procurement procedures were not complied with, arrangements had been in place for a considerable time, with one dating back to 1991. Some contracts had “long since expired and the arrangements continued to be rolled over, year after year”.

Other key findings in the C&AG report include:

- The HSE is failing to submit, as required, timely annual reports to the Department of Expenditure in respect of contracts over €25,000 awarded without a competitive process. This is because it did not have an automated system to maintain a register of all contracts awarded without competitive process. As the HSE is relying on individual areas to identify and report non-compliance, it cannot confirm that the reports submitted include all instances of non-competitive procurement.

- Of 36 instances of non- competitive procurement identified on audit, 31 should have been included in a report to the Department of Expenditure, but only three were. In the locations reviewed there was under-reporting, by 83% value, of money spent.

- While HSE managers are supposed to attest to compliance by signing a periodic control assurance statement — in 2013, 92% of them did — the HSE was unable to break the percentage down into how many managers had reported compliance or non-compliance.

However, the HSE said consistent or deliberate non-compliance with the requirement to make a self-assessed declaration for the purpose of completing a report “will be dealt with under the HSE’s disciplinary procedures”.

The C&AG recommended the HSE put in place formal processes to check compliance with procurement rules. The HSE agreed and said it plans to deliver more staff training.

The C&AG also recommended staff be made aware of framework agreements and the HSE said actions were under way.