The National Audit Office (NAO) has criticised a minister and a parliamentary secretary for re-ranking firms which bid for a contract to provide legal services for the granting of concessions for the operation of casinos.
The re-ranking was made after the original ranking was made by an Evaluation Committee.
A NAO evaluation was carried out that the request of the Opposition MPs on the Public Accounts Committee (PAC)
The MPs had quoted a media report (in Times of Malta) where it as reported that a decision by the Evaluation Committee was overturned by Minister for Economic Affairs (Chris Cardona).
The minister had publicly declared that he had revised the evaluation criteria decided on in the selection process and changed the legal firm chosen by the Evaluation Committee.
It was further alleged that the minister, aware that he could not effect such changes, then requested the Ministry for Finance to sanction the change through the approval of a direct order.
In its investigation, National Audit Office said it identified various shortcomings.
The Evaluation Committee was not formally appointed by the ministry, nor was it furnished with clearly defined terms of reference outlining its expected functions and responsibilities. These shortcomings created a sense of ambiguity that manifested itself at various stages throughout the legal firm selection process.
The audit office said it commended the ministry's initial endeavours at designing a selection process that was open and transparent, most notably so in terms of efforts intended at widening eligibility by removing past experience of privatisation processes as an eligibility requirement. Such efforts, if seen through, would have served to promote good governance.
However, the removal of past experience as an eligibility requirement subsequently created the need to establish another mechanism whereby the interested legal firms’ quality could be assessed and ascertained.
The Economic Affairs Ministry's failure in providing adequate guidance regarding evaluation criteria, despite the numerous attempts at sourcing such assistance by the Evaluation Committee, contributed to the difficulties that subsequently surfaced. This guidance was critically required in view of changes implemented with respect to eligibility criteria.
Attempts made by members of the Evaluation Committee to seek guidance from this ministry were warranted and certainly merited attention, but this was never forthcoming.
On the other hand, failure on the part of the Evaluation Committee to proactively propose and utilise comprehensive criteria other than the price criterion eventually employed, was deemed as constituting a shortcoming by the committee, as was the evaluation based on price alone, which resulted in an incomplete analysis of offers received.
The ranking process as carried out by the Evaluation Committee was not deemed acceptable on the above grounds, and a re-ranking process was carried out directly by the minister and the parliamentary secretary within the same ministry.
"In NAO’s opinion, this re-ranking detracted from the process’s overall level of transparency. It was impossible for NAO to establish a clear understanding of the re-ranking as per documentation provided, especially how each of the firms fared with regard to the individual elements that constituted the qualitative review. The relevance of such documentation in relation to the re-ranking process assumes critical importance given the significant changes to the original rank order established by the Evaluation Committee," the audit office said.
It said the ministry was was effectively constrained in having to resort to the placement of a direct order due to the fact that no advertisement in the Government Gazette had been placed with respect to this request for legal services.
The report may be accessed by visiting www.nao.gov.mt
MINISTRY'S REACTION
In a reaction, the Economic Affairs Ministry noted that the auditor had praised the ministry for having drawn up a selection process aimed at greater transparency by broadening the eligibility criteria and removing the need for past experience.
The audit report also confirmed that there was a serious shortcoming in that the legal firm which was initially recommended by the committee was chosen solely because its bid was the cheapest. This justified the ministerial intervention for the process to consider the other elements of the offers. It was clear that the chosen firm had no connection with the Labour Party.
The ministry, however, recognised that some matters could have been better handled and would consider the recommendations made.
See also http://www.timesofmalta.com/articles/view/20130715/local/cardona-i-wanted-more-transparency.478086