A report commissioned by Dublin Institute of Technology (DIT) has criticised senior management for a lack of oversight regarding almost €30 million in tax payers’ money.
The report by consultants Ernst & Young (EY) was drawn up following DIT's loss of more than €700,000 in up-front payments to an academic journal provider which went bankrupt.
It comes as the college and other third-level institutions appear before the Dáil's Public Accounts Committee on Thursday to face allegations that they misled TDs over the way they run their financial affairs.
The EY report provides a detailed account of the “lack of management oversight” and breaches in purchasing policy surrounding the losses by DIT relating to an academic journal provider called SWETS.
The report seen by The Irish Times, found a “lack of management oversight” of this process by DIT procurement department.
Not isolated
It also found that it was not an isolated incident with some €29.5 million over a three-year period that was not subject to proper checks and balances.
Among the report’s other findings in relation to the payment to SWETS are that:
* Proper procedures were not followed and no formal contract could be found;
* The only signature on any documentation between SWETS and DIT was that of a college library staff member. However, contracts of this size should have been approved by the senior staff including the president, Prof Brian Norton, and the governing body;
* The payment did not go through standard purchasing procedures, which would have involved review procedures;
* There was no challenge from the finance department to such a significant unapproved payment;
* Nor was there a challenge to making such a large payment in advance to avail of an “early payment discount” worth just over €4,000.
The college spent €671,000 up-front to the company in July 2014 for access to academic journals during 2015.
It was also in credit to the company for almost €50,000. However, the company went bankrupt the following October.
DIT went on to pay some €760,000 to another academic journal provider called EBSCO to ensure students had access to journals during 2015.
The consultant’s report – which was completed in 2015 at a cost of almost €27,000 – was not provided to the Dáil’s Public Accounts Committee when DIT first faced questions on these issues in 2016 and, again, last April.
Instead, it provided a “management review” report to the committee which included findings and recommendations, but which omitted the detailed criticism.
This has prompted claims from some TDs that it was “misled” and crucial information has been withheld despite the committee’s request for a detailed account of the circumstances from DIT surrounding the losses.
A DIT spokeswoman said in recent weeks the EY report itself had been sent to the PAC.
External investigation
It is understood that DIT’s governing body – which originally requested an external investigation into the matter – held a special meeting in recent weeks to discuss the issue.
This followed concerns aired in an RTÉ Investigates programme last month into lapses in corporate governance across the higher education sector including DIT.
The DIT governing body directed Prof Norton to furnish the Public Accounts Committee with the report. It also directed the president to convey its “regret and concern” to the committee over the delay in doing so.
A DIT spokeswoman said: “ For the avoidance of any doubt, at a meeting on May 30th 2017, DIT governing body directed that the report should be forwarded to PAC immediately and this was done on May 31st.
“Relevant extracts from Governing body minutes were also included, identifying the actions taken by Governing body with reference to the financial loss sustained.”
Public Accounts Committee officials confirmed on Thursdasy that they received the correspondence.
Officials initially indicated on Wednesday June 21st they did not have a record of the correspondence. However, a subsequent search found the committee had, in fact, received the documents.
