Grants worth £53m to boost the rural economy were made by the Welsh Government without ensuring value for money, a report has found.
Projects were given money without others getting a chance to bid, and without officials making sufficient checks that they were worth the cash.
The Auditor General for Wales called for controls to be strengthened.
The Welsh Government said it had taken action and recognised best practice had not been followed.
The Conservatives said the report “highlights the staggering level of incompetence at the heart of the Welsh Labour government”.
What was the funding?
- The cash was spent as part of the Welsh Government’s £774m Rural Development Programme
- Between 2014 and 2020 this included £522m of EU funds and £252m of domestic cash.
- But key aspects of the design, operation and oversight of the scheme were not effective enough to ensure value to the taxpayer, according to the report.
Grants are usually awarded to projects following open competition between bidders, helping to ensure the best projects get funding.
The report, published by Auditor General for Wales Adrian Crompton’s organisation Audit Wales, said £68m had been granted through “direct applications” where individuals or organisations are asked to apply without any competition for the cash.
Where did they find problems?
They looked at a sample of £59m to see if alternative measures – like specifying rigorous conditions or monitoring – were taken to ensure value for money.
But the Welsh Government gave no evidence that it had done so for £28m worth of awards made in the three years to January 2019.
In one case, the Welsh Government had advertised a project worth £500,000, but later awarded three applicants grants worth £21m.
Mr Crompton said the initial advertisement was not an “effective analysis of market competition” to deliver a £21m rural development project.
What about money for existing projects?
Audit Wales also checked £30m worth of grants out of a total of £62m awarded to existing projects in 2017.
It found that the Welsh Government could not show it had considered whether the project was successful for £25m worth of these grants.
Neither had it taken any other measures to ensure value for money.
For the sample it checked, £4m went to existing projects where the initial awards had not been subject to any competition.
Mr Crompton said: “Tax payers need confidence in their government’s use of public funds.
“My recommendations are intended to strengthen controls so that all rural development grants are well governed and likely to deliver value for money, particularly where awards are made without competition.”
The report did not say what organisations received the grants in question, or what the money was for.
‘Yet another kick in the teeth’
Conservative Senedd member Andrew RT Davies said the report “again highlights the staggering level of incompetence at the heart of the Welsh Labour government”.
“This is yet another kick in the teeth for agriculture and the hardworking taxpayer in Wales,” he said.
A Welsh Government spokesman said it was grateful for the report and would respond in due course.
“We acknowledge the approach to testing value for money for a number of historic Rural Development Programme projects did not represent best practice,” said a spokesman.
“As part of our ongoing review of delivery of the Rural Development Programme we had also identified the issues described by Audit Wales and taken action to remedy them. The report’s conclusions provide helpful guidance to ensure that all the necessary actions have been implemented.”