The secretary-traditional of the Commonwealth, Baroness Scotland, has been strongly criticised by inner auditors for awarding a profitable consultancy contract to a firm bustle by a private pal.
The world organisation’s Audit Committee accused her of “circumventing” the customary aggressive tendering principles by awarding a £250,000 price to KYA Global.
The firm, owned by fellow Labour gaze, Lord Patel of Bradford, used to be shriveled to carry out a review of the Commonwealth Secretariat, the physique headed by Woman Scotland from London.
Nonetheless the audit committee document claimed that Lord Patel’s firm used to be “it sounds as if insolvent” on the time with cash owed worth more than £40,000. And it said that the Commonwealth Secretariat used to be unable to present the auditors with KYA Global’s final document setting out its suggestions.
The committee’s document – obtained by the BBC – expressed concerns that the Secretariat’s “acts and omissions” when it comes to the contract – and other alleged failings it identifies – “[endanger] the integrity” of the institution and probability “extreme reputational if no longer true harm”.
Woman Scotland’s legal professionals insisted the resolution to award the contract used to be entirely justified and complied with procurement procedures on the time.
The Secretariat is the central administrative hub for the Commonwealth, made up of 53 countries – many of them aged British colonies – which embody nearly a third of the enviornment’s population.
The intense document may presumably presumably also carry contemporary questions about whether Woman Scotland will seemingly be given a second period of time of station of work by Commonwealth heads of authorities when they meet in Rwanda later this Twelve months.
There may be already disquiet among some member states relating to the procedure in which the Secretariat has been bustle.
The BBC understands that one main Commonwealth nation has recently stopped giving funds to the institution.
Woman Scotland and Lord Patel were as soon as Labour ministers collectively in the House of Lords.
The investigation into his appointment used to be implemented by the exterior accounting firm KPMG in September final Twelve months on the demand of the Commonwealth High Commissioners in London, who collectively originate the arena organisation’s board of governors.
KPMG came upon that the consultancy contract used to be given to Lord Patel in April 2016 on “the personal suggestion from SG Scotland” because he had “a high level of confirmed trust with the secretary traditional”.
Woman Scotland asked one of her deputies to absorb out a originate waiving the customary aggressive tendering principles, which she then authorised.
The audit committee mentioned the preliminary contract used to be for £90,000 inclusive of VAT for three months’ work.
That used to be then prolonged for a second contract worth £162,000 for a further six months’ work, it claimed, and no other firm used to be regarded as.
Essentially based entirely entirely on KYA Global’s accounts, the firm on the time had resources of £971 and cash owed of £48,762.
In its document, dated 21 November 2019, the Commonwealth’s audit committee mentioned: “Awarding an it sounds as if insolvent firm two contracts totalling £252,000 is irregular.”
The committee mentioned it used to be anxious that “disclosing a true or perceived battle of pastime and then instructing a subordinate to put collectively the waiver in give away to approve it circumvented a first-rate management in the procurement assignment”.
It also came upon that the Secretariat had no register either of gentle waivers or conflicts of pastime and used to be unable to point to why no longer.
Below Commonwealth principles, aggressive tendering procedures may presumably presumably also additionally be waived in obvious instances, resembling if a resolution has to be taken urgently or if there are no longer enough suppliers.
The committee identified no fewer than 50 times between July 2015 and June 2018 when the customary procurement tenders had been waived by the Commonwealth Secretariat.
Just a few of these choices predated Woman Scotland’s appointment in April 2016.
The document concluded: “The audit committee is anxious that the acts and omissions spot out above as neatly because the absence of any reason in the help of those failures endangers the integrity of the Secretariat.
“On the least the failures identified probability extreme reputational if no longer true harm to the Secretariat.”
It added: “No topic requests, the audit committee have no longer been equipped with the document ready by KYA Global and delivered as a final doc by 30 June 2016 as required in the preliminary contract.”
In a assertion, Woman Scotland’s solicitors, Carter-Ruck, mentioned that KYA Global Ltd used to be awarded the 2 contracts “on the premise of its confirmed song file in trade management consultancy” and its products and services were “dearly important” on the starting of Woman Scotland’s period of time of station of work.
It mentioned: “This resolution used to be wholly justifiable and SG Scotland used to be urged that this complied with the procurement procedures that were in force on the time.
“SG Scotland started her submit as Commonwealth Secretary-Total on 1 April 2016 when the Secretariat used to be in a extraordinarily sad monetary station and used to be in dire need of reform. “She used to be tasked with reworking the organisation urgently.
“The appointment of KYA, a main trade management consultancy, used to be one of the most steps SG Scotland took to bring about that trade in haste.”
Carter-Ruck insisted that KYA Global “has never been deemed insolvent and it is miles faux to insinuate in another case”.
It mentioned: “The assertion that KYA Global used to be a legally insolvent firm is unsuitable and has been made certain to the Secretariat’s audit committee chair.
“As neatly as, it is miles faux and misleading to issue that KYA Global used to be awarded contracts totalling £252,000.
“Slightly KYA Global used to be no doubt awarded two contracts worth £75,000 (plus VAT) every. These contract awards characterize heavily subsidised charges from the costs which KYA Global may presumably presumably have charged the Secretariat.”
The assertion persisted: “The resolution to award KYA Global the contracts has been entirely justified in light of the sleek success of the Secretariat which has long gone from strength to strength in contemporary years and has successfully gone through a modernisation assignment.
“The Secretariat has complied entirely with the demand of its auditors and has adopted and utilized, or is enforcing, their suggestions.”
The BBC made repeated makes an are attempting to contact Lord Patel but there used to be no response.