An Investigation of the 2015 Local Councils’ Capital Projects Fund

On 23 March 2015, the Opposition Members of Parliament (MP) on the Public Accounts Committee together with two other Opposition MPs requested the National Audit Office (NAO) to investigate grants allocated through the 2015 Local Councils’ Capital Projects Fund. The terms of reference established by the NAO included the review of the processes of application and selection, the communication of results, the appeals procedure, as well as the appointment of the Evaluation and Adjudication Committee (EAC) and the Appeals Board (AB). Funds awarded under this scheme amounted to €1,000,000 in 2015, while allocations of €975,000 and €470,000 were recommended for 2016 and 2017.

The NAO noted that the information communicated to LCs at pre-submission stage was at times deemed incomplete in relation to certain aspects of the selection process. The EAC’s failure to indicate the required supplementary supporting documentation and the unclear importance attributed to the involvement of the private sector were two examples in this regard. During clarification meetings held with individual LCs after the submission deadline, Councils were allowed to submit further documentation and encouraged by the EAC to make improvements to their proposals. Changes effected at this stage were integrated in the submissions as if they were part of the original application, consequently bearing an impact on the evaluation and ranking of projects. In this Office’s opinion, post-submission changes, lack of documentation of meetings held and the discretion afforded to the EAC detracted from the fairness of the process.

This Office’s attention was drawn to various issues of concern relating to the evaluation of applications. Inconsistencies were noted in terms of documentation deemed necessary by the EAC, with certain cases penalised for not submitting supplementary documentation, while in other cases, funds were awarded despite the fact that similar documents were not made available. The NAO also noted an element of ambiguity in the interpretation of certain evaluation criteria, specifically with regard to the private sector involvement criterion. Another issue noted by the NAO related to inconsistencies in the reliability of the scoring system employed, with projects bearing similar characteristics rated differently.

The NAO is of the opinion that the main shortcomings identified with respect to the 2015 LCs Capital Projects Fund may be traced back to the broad parameters established. Eligible projects varied widely in terms of their characteristics, aims, scope, financing mechanism and scale, yet were to be comparatively assessed by the EAC in order to determine the allocation of funds thereto. This context rendered inevitable the eventual discretion exercised by the EAC in the adjudication of highly divergent projects. Although certain shortcomings were inevitable owing to the Fund’s broad scope, the discretion exercised was further compounded by the EAC’s poor management of the process.

The NAO acknowledges the introduction of the appeals process as a positive development. However, this Office noted several shortcomings that characterised the process. Furthermore, the NAO deemed the AB’s interpretation of its terms of reference as too narrow, with certain claims presented in the letters of appeal unaddressed.