A shock new audit report into Aberdeen City Council’s handling of contracts has found the authority broke European law.
Internal investigators were asked to examine the local authority’s compliance with procurement legislation and council regulations with over £600million of payments made every year.
Complex EU tendering rules were found to have been broken.
Under the legislation, the council’s combined spend on similar products and services or across multiple separate orders on three different occasions, known as aggregate expenditure, was too high.
Suppliers were also not given specific contracts for tender in these instances, breaking procurement legislation.
By September, individual services should ensure plans are in place to procure goods and services which are anticipated to exceed relevant thresholds under the recommendations.
In total 10 of the 50 of the contracts examined – totalling £27million over four and a half years – were not put through the legally required register.
Under council rules, all contracts in excess of £50,000 for supplies and services, and £2million for works, should be published.
In all, 13 areas of concern were uncovered – including the auditors being unable to find committee approval for spending in eight of 50 cases.
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The report reads: “The majority of contracts reviewed had been entered into with appropriate prior approval, via procurement routes compliant with the council’s and national regulations, and appear on the council’s published contracts register.
“However, this was not always the case.
“In three areas EU procurement thresholds have been exceeded through the council’s combined spend on similar products and services or across multiple separate orders (aggregate expenditure), and no specific tendered contracts are in place with the suppliers used in these instances.
“In respect of all three supplies, the council is in breach of procurement legislation as a result.”
It has been recommended that the authority reviews their processes to ensure all contracts are managed properly.
The report will be viewed by committee next Tuesday.
Audit committee convener Stephen Flynn: “Complying with procurement legislation is fundamentally important for all public bodies and robust processes must be in place.
“Similarly, where it is clear that a decision is one that should be taken by councillors then, quite simply, that matter must come before the relevant committee.”
Council co-leader Douglas Lumsden added: “We have to comply with European regulations and I’m sure that actions identified will be put in place.”
