GSD probes healthcare contracts worth £4.8m, as Govt insists it was ‘best price possible’

The GSD has called on the Gibraltar Government to make a statement to Parliament about issues raised by the Principal Auditor relating to the award of contracts worth over £4.8m to MedDoc Ltd.

The Opposition said the findings set out by the Principal Auditor in his latest report raised “very significant issues of good governance and transparency”.

Reacting to the Opposition, the Gibraltar Government insisted the contracts followed “a competitive tender process and detailed negotiations” conducted by government officials seeking value for money for taxpayers.

At the core of the exchange is an audit by the Principal Auditor and his team that raised questions as to whether the bids leading to the contracts were the most competitive for the public purse.

The objective of the audit study by the Principal Auditor and his team was to review the processes followed by the GHA in meeting Gibraltar and EU procurement standards that applied at the time, and to determine if the correct procedures had been followed.

The scope of the review did not include a focus on the delivery of the service provided.

The Principal Auditor’s conclusion was that in the case of all three contracts, the relevant provisions had “not been adhered to from the beginning to the end of the process”.

The contracts, awarded between 2015 and 2018, were for elderly healthcare services at the Hillside Dementia Residential Centre, the John Mackintosh Wing of St Bernard’s Hospital and Bella Vista Dementia Day Centre.

They included one whose scope was enlarged to an additional value of over £900,000.

In probing all three contracts, the Principal Auditor said he had been unable to establish whether tender requirements for large public contracts had been complied with, or whether MedDoc’s bids were the most competitive.

The Principal Auditor said there were no signed formal contracts in place for any of the three healthcare tenders which were coordinated by the GHA and the Care Agency instead of by the Procurement Office.

That, he said, had been a missed opportunity to acquire key knowledge and expertise in the field of public procurement.

The Principal Auditor also raised questions about the informal nature of the contracts which, he said, could potentially put at risk continuity of service in the event it was terminated by the supplier.

The Gibraltar Audit Office had been requesting information in regard to the tender process and tender submissions since November 2017, but no formal written record of the stages of the internal tender procedures were made available to the audit examiner, and a number of documents relating to the tender process were never provided.

In respect of the contract at Hillsides, the Principal Auditor noted that the contract was initially awarded to another party and then removed from that entity and awarded to MedDoc in circumstances where he had been unable to verify the basis of that decision or assess whether it was the most competitive offer.

In relation to the contract at Bella Vista, he noted that the contract award to MedDoc was in the sum of £1,425,558 in 2017 but that variations were made to the contract that resulted in an increment by £931,034.

He said that this was in contravention of tendering rules and that, in common with the Hillsides contract, he could not obtain the assurance that it represented the most competitive bid.

The Principal Auditor also noted that variations in respect of the contract for the John Mackintosh Wing contract were also contrary to tender regulations.

“In the absence of official tender documentation, I am unable to conclude that the contracts for the provision of healthcare services for the elderly in the three sites were awarded to the best tender submission bids in all three cases,” he said in the report.

Keith Azopardi, the Leader of the Opposition, said the conclusions by the Principal Auditor and his team after an in-depth investigation spanning years were “remarkable”.

“The conduct it reveals is unacceptable and raises serious questions of probity, transparency and good governance,” Mr Azopardi said.

“How is it possible for MedDoc to have been awarded these contracts in this way and why?”

“A statement to Parliament should be made by the Health Minister as to why there are gaping holes in the documentation; how it is possible that the tendering rules were breached; and what action the GHA will be taking in light of this report.”

“Quite apart from the breach of rules involved, the tax-payer is entitled to value for money and there should be no suspicion as to how or why contracts have been awarded.”

GOVT RESPONSE

Last night, the Gibraltar Government said the GSD was seeking to exploit the Principal Auditor’s report for its own political gain.

It said the party’s “spurious accusations” sough to “bring into disrepute” not only the Government but a contractor that provided “invaluable care” to some of the most vulnerable in the community.

No.6 Convent Place said the contract in question was awarded to MedDoc after a competitive tender process and detailed negotiations carried out by a team of Government officials, “which ensured that the services were procured at the best price possible”.

“At least two other tenderers were not pursued due to questions relating to their demonstrable experience levels, and legal and financial issues,” it said.

Following the award of the original tender to MedDoc, the Government said it opted to expand its provision as keeping one provider for a number of services “would guarantee better value for money for the taxpayer”.

It accused the GSD of trying to make political capital out of information and figures “that have been public for years”.

The tenders in question were awarded around 2016, were detailed in the Book of Estimates at the time and were available for scrutiny by both the GSD and the public, No.6 said.

“That the GSD choose to bring this to the fore now is evidence enough of their desperate intent to manipulate the Principal Auditor’s report to try to convince the public of wrongdoing where it doesn’t exist,” it said.

“One entirely legally unsuitable deal that did exist, however, was the one done by the GSD illegally via direct allocation – that is, with no tender process whatsoever - and against EU public procurement requirements, to the value of £1 billion.”

“They even went ahead and started making payments.”

“Luckily for the taxpayer, this GSLP/Liberal administration stepped in and terminated the GSD’s illegal contract, which even Mr Azopardi criticised when he was anti-GSD before leading the GSD, on the basis that it was illegal under both Gibraltar and EU law.”

Chief Minister Fabian Picardo added: “This Government will not be lectured by the GSD on the awarding of contracts when tender and procurement processes are more transparent now than ever before.”

“It is clear that Mr Azopardi and his party are trying to manipulate the analysis of the [Principal] Auditor as a means of seeming relevant.”

“The reality is that these figures have been public for years and both as a result of this Government’s tender process and in the Book of Estimates.”

“The GSD forget that the people of Gibraltar remember their questionable dealings and the disastrous consequences that they would have had for our community and for our coffers.”