A CONTROVERSIAL aid consultancy received more than £462 million in taxpayers’ cash over five years, according to a report.
Adam Smith International, which was widely criticised for poor practices, was paid nearly £104 million in the last financial year, figures released by an aid watchdog showed.
It pulled out of the bidding process for new contracts and four executives quit following pressure over its operations.
The Government has made “positive progress” in improving competition among contractors and value for money, says the Independent Commission for Aid Impact (ICAI).
It said it was too early to judge some of the reforms that have been introduced and gave the East Kilbride-based Department for International Development (DfID) an overall green-amber assessment.
But the department has been slow to exercise new accounting methods that would make supplier fee rates and costs more transparent, ICAI said.
It warned the complex and lengthy nature of aid programmes can “lead to an imbalance of information” between the DfID and its suppliers, particularly larger organisations.
“Such firms have advantages over new entrants and the potential to use their market power to increase their profits,” it said.
Figures requested by ICAI from the department showed spending with ASI rose steadily from £63.4 million in 2012/13 to £112.3 million in 2015/16 before falling to £103.8 million last year.
DfID has 21 live contracts with ASI but has not signed any new deals or extended existing agreements since December last year.
The consultancy faces allegations it falsified submissions to a committee of MPs and made use of improperly obtained government documents for commercial gain.
Alison Evans, ICAI’s chief commissioner, said: “Ensuring that a wide range of suppliers are able to bid and compete for DfID contracts is important to ensure that UK aid programmes have access to specialist skills at the best possible price.
“Overall we found the department had a welcome increase of ambition in this area, and a positive direction of travel, including the many of the initiatives announced in the recently-published supplier review.
“However, there are some important areas where improvement is needed, such as tackling the constraints facing local suppliers, pushing ahead with open-book accounting for greater transparency, and addressing long and complex procurement processes.”
DfID insisted that existing aid suppliers do not receive preferential treatment and the system was being simplified to make it easier for smaller organisations to win contracts.
A spokeswoman for the DfID said: “ICAI’s report rightly recognises that DfID is making positive progress and serious effort to achieve value for money through its work with suppliers.”
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