Welsh health board's handling of HR contracts 'well below standard'

19 Jul 17

A Welsh health board’s procurement and management of HR consultancy contracts fell well short of expected standards, auditors said in the first report of its kind.

The way Cardiff and Vale University Health Board’s handled the contracts breached public procurement rules and exposed the health board to unnecessary financial and reputational risk, the Welsh Audit Office found.  

Huw Vaughan Thomas, auditor general for Wales, said – in releasing the report on Monday: “This is the first time as auditor general that I have issued a report in the public interest on an NHS body.

“There were numerous and significant failings and the actions of the Health Board fell well short of expected standards which has led to me taking this highly unusual step.”

The report stated clear procedures designed to ensure taxpayers’ money is spent efficiently and effectively were “disregarded”.

He added: “I’ve issued this report to highlight these failings, to hold Cardiff and Vale University Health Board to account, and in the hope that other organisations will take heed and not repeat these mistakes.”

The Health Board failed to comply with its own procurement requirements, according to the report, when it awarded consultancy contracts to RKC Associates Ltd in November 2014 and June 2015.

It also failed to ensure the integrity of the procurement process that led to an additional contract being awarded in February 2016.

By failing to adhere to the regulations the health board was unable to demonstrate that the contracts were awarded fairly, transparently, lawfully or that they obtained value for money, the Welsh Audit Office concluded.

The contracts were awarded because of a shortfall in HR leadership capacity at the health board after the director of workforce and organisational development was seconded to another NHS organisation at short notice.

RKC Associates Ltd were paid over £290,000 for the service provided.

When the director of workforce and organisational development subsequently left the employment of the health board, a recruitment exercise proved unsuccessful in appointing a replacement because the shortlisted candidates withdrew for various reasons.

While the position was not re-advertised, the then sole director of RKC Associates Ltd was interviewed and subsequently offered the position on a one-year fixed-term contract on an annual salary of £150,000.

The report stated this appointment process was “fundamentally compromised, lacked transparency and was poorly documented”.

The Cardiff and Vale University Health Board issued a statement thanking the WAO for its review of the failings and saying it accepted the findings of the report in full.

Len Richards, chief executive officer for the health board, said: “It is deeply disappointing that in my first month in post I have received such a damning report.

“I cannot account for the actions of others prior to my appointment but I can assure you that now I am in post we will be scrutinising a number of significant factors that enabled this to happen without challenge or following the right processes in place. 

“It is my task to ensure that all staff comply with our policies and procedures and strengthen them where necessary.”

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