Aid contracts given without competition

The Department for International Development was censured yesterday by a committee of MPs who revealed that aid contracts worth more than £100m had been awarded to private consultants without competition.

The Department for International Development was censured yesterday by a committee of MPs who revealed that aid contracts worth more than £100m had been awarded to private consultants without competition.

The International Development Select Committee questioned how the department, and the Secretary of State, Clare Short, could know it was spending taxpayers' money fairly or effectively.

Almost nine out of the 10 contracts given to consultants by the department were never advertised, the committee said. In one case, a foreign company was employed to run a resource centre for the department in breach of its own rules.

The department spent £267m on consultants in 1999-2000 - more than double the £115m it spent five years earlier and almost one-tenth of its total budget. It is only obliged to advertise contracts worth more than £250,000, and those worth less than £100,000 are not advertised at all.

But the committee said the department should ensure that its procedures were fair, consistent and transparent. "It is unfortunate some contracts are let non-competitively simply because of their comparatively low value. The comments made [to us] lead us to question the adequacy of the mechanisms DfID currently has in place to ensure fair and effective decisions are made on the selection of contractors," the committee said.

The British Consultants' Bureau, representing 300 organisations, said newer companies found it hard to win the work because they often did not know about it until it was too late.

Its chief executive, Colin Adams, said he had been talking to the department about how it could improve. "They are extraordinarily good at getting hold of the European Union and the World Bank by the scruff of the neck and making sure they get things in order, but they leave an awful lot to be desired in the way their own procedures are run," he said.

Menzies Campbell, the Liberal Democrat foreign affairs spokesman, said: "Contracts placed without competition inevitably attract suspicion, even if it is entirely unjustified."

* No European Union aid has reached El Salvador, Guate-mala, Nicaragua and Honduras since they were hit by Hurricane Mitch in 1998. Bowen Wells, the chairman of the International Development Select Committee, said the EU had failed to spend "one cent" of the £170m package pledged. "The whole purpose has been lost," he said.