UCD spent €8.6m last year without following procurement rules

University College Dublin, which incurred 'significant expenditure' outside public procurement procedures, according to the C&AG.

Ireland’s largest university spent €8.6m last year without following national and EU rules around procuring goods and services.

University College Dublin (UCD) incurred “significant expenditure” outside of public procurement procedures, according to Seamus McCarthy, the

Comptroller and Auditor General (C&AG).

The C&AG’s note is included in the university’s recently published financial statements for the financial year ending in September 2019.

In its statement, the university acknowledges it did not adhere to public sector procurement guidelines at all times.

The level of expenditure assessed by the university’s finance office as non-compliant with public sector procurement requirements amounted to €8.6m, representing 4.2% of the university’s overall non-pay spend of €205m that year.

A procurement plan detailing expected major procurement competitions has since been completed and submitted to the Education Procurement Service (EPS) and the Higher Education Authority (HEA), the statement notes.

Under the Office of Government Procurement (OGP) model, UCD is responsible for complying with procurement guidelines and required to use suppliers of goods and services selected by the OGP.

“During the ongoing implementation phase of the OGP model and primarily due to resourcing and timing issues it is not always possible to match the output of the OGP process to the procurement requirements of the university,” the financial statement states.

“This leads to a risk that contracts will expire in advance of being re-tendered or that contracts will be extended temporarily beyond their original duration without going through the appropriate procurement processes.” 

The university recruited a director of procurement during 2019 and aims to achieve full compliance with public sector procurement requirements over the next two years, it added.

The ongoing Covid-19 pandemic is having a “significant adverse impact” on UCD’s ability to generate non-Exchequer sourced income, the report also notes.

Cost reduction measures

However, as the university is taking “cost reduction and other mitigating measures”, it is satisfied that it can sustain operations for the foreseeable future.

In November 2019, the University signed a loan financing facility of €123m with the Housing Finance Agency PLC (HFA), of which, €90m was drawn down by September 2020.

“Since the start of February 2020, the university’s ability to generate non-Exchequer sources of income has been challenged by the outbreak of the Covid-19 virus which is having a significant adverse impact on the university’s ability to generate commercial income from on-campus concessions agreements, student residences income and summer business for 2020.

“While there are significant uncertainties associated with the coronavirus outbreak, the university maintains that with its healthy cash balances and continued tight cost control and its ability to generate income from other sources that it can sustain its operations in the current volatile environment.”