site.btaInternal Audit at Regional Development Ministry Finds Irregularities in Award of Two In-house Contracts

An internal audit at the Regional Development and Public Works Ministry has found irregularities in the award of two in-house contracts between the Ministry and the National Centre for Territorial Development (NCTD), which is a consultancy and design centre with the Ministry, it said Friday. The contracts were awarded by the Ministry's previous leadership and are worth a total of BGN 2,551,200.

The inspection was ordered by Regional Development Minister Violeta Koritarova and the audit report was sent to the Public Financial Inspection Agency. One of the auditors' main findings was that at the time of submission of the technical proposals for implementation of the two contracts, NCTD offered to implement them with third party resources instead of with its own.

One of the contracts concerns Investment "Support of a pilot phase for the introduction of building information modelling in investment design and construction as a basis for digital reform of the construction sector in Bulgaria under the National Recovery and Resilience Plan". It is worth BGN 2,397,600 and is implemented with NCTD financing. The irregularities pose a risk that the Ministry will foot the bill from its budget and will not be able to recover the funds. 

The second contract, worth BGN 153,600, is a draft amendment to the Spatial Development Plan for the entire territory of Tsarevo Municipality and an environmental assessment.

The audit found that some of the experts on the implementation teams were not in employment or other legal relationship with NCTD before the conclusion of the contracts. At the time of submission of the technical proposals for their implementation, the applicant itself did not have the resources to provide the service as required by the Public Procurement Agency to apply the exceptions from the Public Procurement Act for the conclusion of in-house contracts, the Regional Development Ministry said.

Statements of commitment are also missing for some of the experts not employed by NCTD. They are required as an assurance that the company will have the resources to perform the two contracts throughout their validity, which is part of the contracting authority's minimum requirements, the audit report said.

The auditors of the Regional Development Ministry checked the conclusion of a third in-house contract dating from the same period for "Comprehensive review and preliminary study of the scope and tasks for a forthcoming update of the Marine Spatial Plan of the Republic of Bulgaria 2021-2035 - Stage 1". No irregularities were found in the award of the in-house contract worth BGN 249,600.