Following our complaint, NAO finds multiple violations of public spending regulations

20 December 2022

In June this year, we asked the Auditor General to investigate direct orders issued by the Ministry of Transport, Infrastructure and Capital Projects, to The Events Company (TEC Ltd), supposedly for the launch event of the Malta Metro project. The available evidence indicated that profits from public contracts awarded to the company supports its underpriced services for campaign events of the governing Labour Party and its candidates.

In its Annual Audit Report on the Public Accounts for 2021 published last Monday, the National Audit Office says procurement for the Malta Metro launch event was handled personally by the then Minister for Transport, Ian Borg, (now Minister for Foreign Affairs) and Transport Malta’s chair, Joe Bugeja.

Transport Malta spent €550,000 of public funds on the event, €503,851 paid to TEC Ltd alone, exceeding the €400,000 event budget by 37.5%. According to the NAO annual audit report, the procurement process did not follow regulations, and Transport Malta (TM):

  • did not consider the option of obtaining quotations from other suppliers;
  • engaged TEC Ltd by direct order without first seeking approval from the Department of Contracts or the Ministry of Finance;
  • spent more than the planned budget;
  • dated purchase orders after the date of relative invoices, “signifying weak controls over the necessary approval”;
  • negotiations with TEC Ltd were handled directly by Transport Malta chairman Joe Bugeja, without the prior approval of the Finance Ministry or the authority’s own procurement committee which subsequently approved the payments.