Local Authority: Sligo County Council
Issue: Breach of grant claim procedures
Among the issues frequently highlighted by the Local Government Auditor concerns the habitual flouting of grant claim procedures.
A recent example of this is referred to in the 2020 audit of Sligo County Council – although this council is far from the only offender in this regard.
According to rules issued by the Department of Transport, Tourism and Sport, where a council is applying for a grant for funding a road-building project for regional and local roads, it can only claim for expenditure that it has incurred.
The rules, contained in a document called Memorandum on Grants for Regional and Local Roads, state that, "The claiming of unpaid bills by Local Authorities is not allowed".
Other funding bodies have similar requirements.
The department also says that where a project reaches completion and money remains to be paid under the contract terms, it may allow the drawdown of this amount – but only once the department has given its approval in writing.
The department told RTÉ Investigates: "Local Authorities in receipt of State Grants from the Department of Transport must follow the procedures and comply with the conditions contained within [the Memorandum]."
However, a practice has emerged where local authorities submit invoices to funding bodies indicating they made payments to suppliers for certain goods or services. In reality, those invoices relate to 'future' goods or services.
This matter arose in the 2020 audit of Sligo County Council, which identified invoices of more than €1m, which related to items recorded on the financial system as having been received despite this not being the case. The invoices relate to road projects.
The audit stated that those invoices were "parked on the system" and breached "funding agreements that state that claims should only be made for expenditure incurred."
The council’s chief executive replied that "This recording and parking of invoices is used for the purpose of drawing down year end grant funding approved by various funding bodies," adding that process is "managed carefully."
But in a letter sent to the council on foot of the 2020 audit, the auditor said: "This represents a breach of regulations."
The council told the auditor: "Occasionally invoices are parked as works may not be fully complete prior to grant drawdown deadline."
"This is particularly relevant due to additional COVID-19 constraints in 2020. No monies for works are paid to contractors without certification of completion by Engineer."
