Childcare providers lack adequate oversight, audit report reveals

An audit on the Free Childcare Scheme, recently introduced by the Ministry for Education and Employment, revealed a lack of control over the service providers, according to the Auditor General’s Annual Audit Report on Public Accounts for 2015.

The report, tabled in parliament on Tuesday, concluded that the implementation of a fully automated attendance recording system, introduced at the beginning of 2016, only translated into a new set of risks, which still resulted in significant undue payments.

The audit also found that attendance records maintained by the Foundation for Educational Services were considered unreliable and that no evidence had been obtained to confirm that payroll was adequately verified prior to processing and that overtime was approved before it was performed. 

The report comprises 21 reports on the operations of various ministries, departments and other government entities, including an analysis of the Financial Report 2015.

The National Audit Office (NAO) noted that letters of comfort and bank guarantees, being potential dues by government, reached almost €1.5 billion in 2015 and that substantial excess of expenditure over budgeted figures was reported.

Tfollowing the enactment of the Government Borrowing and Public Debt Management Act, a number of measures would be implemented to introduce a risk-management framework with supporting information technology systems, together with a code-of-conduct and conflict-of-interest rules. 

The main weaknesses identified during an expenditure audit at the Ministry for Transport and Infrastructure consisted of lack of adherence to the public procurement regulations with respect to direct orders obtained retroactively for a number of services. 

The contract price, as well as period of engagement of a service provider to the Ministry for the Economy, Investment and Small Business, was substantially exceeded, according to the report.

The lack of supporting documentation and approvals were also identified while testing expenditure incurred following Malta’s participation in the Expo Milan 2015.

Concerns relating to travel abroad were also noted during the audit.

With regards to the Armed Forces of Malta, the audit found that procurement was not always in line with the applicable regulations, and identified insufficient controls on reimbursements of medical expenses to various members of the Force. 

The report says that invalidity pensions paid by the Department of Social Security were not being periodically re-assessed and that – in the case of female applicants – the invalidity pension was paid at ‘single rate’, irrespective of their marital status. 

It also reveals how – while auditing personal emoluments of the Elderly and Community Care Department – two general practitioners were found to having been overpaid around €27,000 in total. 

The report, in its entirety, may be accessed through the NAO website: www.nao.gov.mt,