WITH DEFICIENCES OF VIEW
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On September 28, the Court of Accounts of the Republic of Moldova (CoARM) examined during an online meeting, the Audit Report on the compliance of public procurement within the system of the Ministry of Education, Culture and Research (MECR) in 2020.
The audit aimed to assess the compliance of public procurement within the MECR system with the provisions of the applicable regulatory framework and to issue the general audit conclusion. Thus, the audit was oriented on the analysis of the procedures, the internal rules related to each stage of the public procurement process within the audited entities.
On 31.12.2020, there were about 200 institutions subordinated to the MECR, of which 88 institutions financed from the budget, which in 2020 made cash expenditures in the amount of 2.46 billion lei, and actual expenditures in the amount of 2.61 billion lei. Also, under the MECR were at least 113 self-managed entities, which received budgetary means through subsidies or state command.
According to the audit findings, the entities subordinated to the MECR do not ensure compliance with the needs assessment, budget determination and preparation of the procurement plan, nor is the correlation between the approved budget and the ensured procurement plan. Thus, 87 budgetary institutions, according to the specified budget, had planned procurements in the amount of 640.48 million lei and 602.32 million lei, respectively. Of these, only 25 entities have developed the procurement plan for 2020 in the total amount of 61.18 million lei, or only for 10.2% of the specified procurements. In addition, out of 106 self-managed institutions active under the MECR, only 29 entities developed the procurement plan for 2020, amounting to 108.3 million lei out of the total procurement of about 654.7 million lei.
The Court of Auditors points out that the entities subordinated to the MECR:
- did not ensure the organization and proper fulfillment of the attributions of the working groups in public procurement, not being expressly established the attributions of each member;
- do not practice the elaboration of quarterly plans and the modification of approved plans in case of identification of new financial resources;
- do not publish the procurement plan on the entity's website;
- did not prepare properly the public procurement file;
Also, the audited entities did not ensure an economic-financial substantiation of the existing solutions for determining the acquisition. For example, the Concert Organization and Entrepreneurship “Moldova-Concert” did not substantiate the choice to contract artistic lighting and sound services, as opposed to procuring the equipment for artistic lighting and sound necessary for the organization of any artistic performance - the main activity of “Moldova-Concert”. Thus, the value of the artistic lighting services of approximately 30 concerts have a value similar to the value of the equipment necessary for the provision of these services.
In the case of the Special Boarding School for blind and partially sighted children in Bălți, it is found that the entity has two thermal power plants: one based on coal and one based on natural gas and fuel oil. The institution uses only the coal-fired power plant, which is located at a distance of 300 m from the central block, which generates losses of at least 30%. The second power plant, located in a building next to the central block built until 2010, has not been put into operation until now, and the school management cannot explain the cause of the power plant's malfunction, nor has it determined the expenses necessary to put it into operation.
The registration, recording and supervision of small value purchases are not performed properly, only 38 budgetary institutions and 48 self-managed institutions submitted to the Public Procurement Agency the report on low value public procurement contracts in the amount of 48.44 million lei and, respectively, of 102.63 million lei.
In 2020, the entities subordinated to MECR made acquisitions in the total amount of 608.3 million lei, of which low value acquisitions and up to 10.0 thousand lei in the amount of 291.5 million lei or 47.9% of total procurement (including budgetary entities - 33.9% and self-management - 60.5%).
Poor public procurement planning determined the deficiencies admitted at the stage of selection and award of procurement contracts, the division of procurement being allowed and the transparency and efficiency of the performed procedures not being ensured. For example, the procedure for purchasing textbooks (39.74 million lei) unjustifiably combines the procurement of the use of “copyright on textbooks” and the procurement of “printing services”, which generates deficiencies in the correct determination of the estimated purchase value and criteria of choosing the winner, as well as essentially limits competition and transparency. Thus, in case of the need to republish a manual, MECR no longer holds a public auction, but performs the procurement through direct negotiations without publication from the winning economic operator of the initial tender, which led to an increase in the value of the manuals by 8.4 million lei. At the same time, the audit was not presented with information on declaring conflicts of interest when purchasing textbooks, being concluded two contracts worth 2.5 million lei, with the economic operator, the founder of which is related to the ex-top manager of the authority contracting, who in turn is also the co-author of the purchased manuals.
In another case, the purchase of liquid hand sanitizer (28.9 million lei), necessary for the prevention and control of COVID-19 infection, was made by establishing unmotivated requirements, which determined the limitation of competition and the purchase of disinfectant at prices increased by at least 7.2 million lei.
The audit mentions that, in multiple cases, was stated the division of procurement procedures, as the legal provisions were not applied. Thus, divisions of acquisitions were found at the Institute of Applied Physics in the amount of 295.39 thousand lei; at the Institute of Zoology worth 221.46 thousand lei, at the Boarding School in Ceadîr Lunga in the amount of 3.06 million lei for the purchase of goods and services, and in the amount of 0.5 million lei for the purchase of clothes, a similar situation is found as in 2019. Also, were divided the acquisitions within the Organization "Moldova-Concert", being concluded 6 low value contracts with the same economic operator in a cumulative value of 690 thousand lei related to the provision of artistic lighting services for events related to the "Martisor" Festival.
During 2020 MECR and its subordinate institutions, contrary to the legal provisions, granted advances for the purchase of goods, services and works amounting to 26.92 million lei, of which for communal services and telecommunications - 5.84 million lei.
MER and its subordinate entities did not comply with the legal norms for monitoring and ensuring the execution and management of public procurement contracts within the terms and conditions provided by them, such as: the construction works of the building of the Dramatic Theater B.P. Hasdeu from Cahul in the amount of 20.6 million lei; the current repair services of the building loaned by the National Museum of Literature "Mihail Kogălniceanu" (164 thousand lei) and the current repair services of the roof of the Special Boarding School for blind and partially sighted children in Balti (199.5 thousand lei).
The audit shows that the current repair services on the roof of the Special Boarding School for blind and partially sighted children in Balti municipality in the amount of 199.5 thousand lei do not correspond to the minutes of execution of works, questioning the veracity of the information in these minutes. For example, in one of them, the linochrome roofing works were carried out on an area of 373.8 m2. However, the school, which granted the contractor's linochrome, according to the accounting records in November 2020, settled 160 m2 of linochrome or 213.8 m2 less, which indicates the increase of the value of the executed works with the amount of 33.5 thousand lei. Moreover, the works were carried out poorly, because after 6 months, the water is filtered between the layers of linochrome on the roof of the building, and rainwater accumulates under the covered layer.
In conclusion, the Court of Accounts mentions that the assessment of the compliance of public procurement in 2020 within the system of the Ministry of Education, Culture and Research with about 200 subordinate institutions reveals non-compliances in the estimation and planning of procurement, as well as the stages of award, execution and monitoring of procurement contracts. The entities neglected to ensure the transparency of public procurement. At the stages of tender evaluation and award of procurement contracts, the public procurement process was affected by a series of non-compliances, conditioned by the lack of impartiality and objectivity in the activity of the tender evaluation working group. These aspects of the work of institutions in the field of public procurement need to be improved in order to increase the transparency and efficiency of the use of public funds.
