University College Dublin (UCD) has admitted to breaking procurement rules after spending over €8 million outside of public sector procurement guidelines. The expenditure was recently highlighted in the university’s financial statements which were published last month.
The financial statements reveal that UCD’s non-pay spend for the financial year ending in September 2019 was recorded to be €205m, of which €8.6m did not comply with national and European Union (EU) rules around procuring goods and services.
Seamus McCarthy, head of the Irish Office of the Comptroller and Auditor General – which works to improve the use of public money and resources and strengthen public accountability – noted in the report that UCD’s 4.2% expenditure outside of national rules was “significant”.
As a university body, UCD is responsible for complying with the procurement guidelines set out by the Office of Government Procurement (OGP), and consequently required to use suppliers of goods and services selected by the OGP.
In the financial statement, UCD explained it was “not always possible to match the output of the OGP process to the procurement requirements of the university” due “primarily […] to resourcing and timing issues” and the ongoing implantation of the OGP model. The statement continued: “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 statement also notes that in 2019 UCD recruited a director of procurement and aims to achieve full compliance with public sector procurement requirements over the next two years. It added that 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).
Elsewhere, the university’s financial statement also highlights the “significant adverse impact” of Covid-19 pandemic on its ability to generate non-Exchequer sourced income. The pandemic, it notes, is significantly impacting “the university’s ability to generate commercial income from on-campus concessions agreements, student residences income and summer business for 2020.”
As a result, UCD has drawn down €90m from a loan financing facility of €123m with the Housing Finance Agency PLC (HFA) which was signed in November 2019. Additionally, the university is taking further “cost reduction and other mitigating measures.”
According to the report: “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.”
Gemma Farrell – Assistant News Editor