Auditor General Urges Review of NPL Transactions

The latest Auditor General report into the operations of Nutrition Products Limited, (NPL), suppliers to the Government’s school feeding programme, has uncovered the company did not always strive to get value for money. It found NPL’s recruitment and selection processes were also below the recommended standard.

The Auditor General has recommended the Education Ministry demand full disclosure of existing contracts and transactions to eliminate potential conflicts of interest.

It was found that in 2017- 2018 the Education Ministry scaled-down NPL‘s subvention by nearly 50 percent and reduced the number of beneficiaries from over 77 thousand to just under 4,000.

This resulted in NPL significantly scaling down production outputs but saw an increased cost per unit. The audit notes the increase in production cost ran counter to NPL’s mandate to operate at the lowest possible cost.

Citing inefficiencies in plant utilization the report notes the 2018 -19 school year, NPL’s Westmoreland plant reported zero production output. However, between April 2018 and March 2019, NPL paid 19.6 million to 33 production workers who were not gainfully employed because production stopped.

The report adds that despite a vast reduction in the number of students and schools receiving meals, delivery costs jumped by 396% in daily rates. The audit notes the management appeared to not analyse how centralizing distribution could inform a more strategic decision over the period 2019 to 2020.

The audit also reviewed the recruitment for 12 managerial staff and identified that for five positions NPL did not advertise the vacancy to find the most suitable candidates.

In eight instances NPL employed persons who either did not meet the minimum qualification or experience required for the positions. In August 2017 NPL employed a Human Resource Manager, who possessed 6 General Certificate of Education, (GCE) though the position required a Bachelor of Science degree and 6 years senior or middle management experience.

The HR Manager stayed on until March 31, 2020, and presided over the employment of others who also did not possess the relevant experience or qualifications.

Except for the CEO and distribution supervisor who later attained the minimum qualification for the posts, it says the others still did not hold the requisite academic qualifications for the posts at the time of the audit.

The Auditor General is recommending decisive policy directives, effective oversight and monitoring, and a review of all connected party transactions.

More in this CVM Live story from Neika Lewis: