Audit critical of PPARS contract

A report by the Health Service Executive's internal auditors has criticised the manner in which computer consultancy services were commissioned for the controversial PPARS payroll system.

The report of the HSE internal auditors maintains that official public procurement policy was not followed strictly enough in relation to these information technology consultancies.

However, it is understood that it says there is no evidence of wrongdoing by any individual.

The internal audit report was sought by the HSE several months ago in the wake of strong criticism from Fine Gael about some of these consultancy contracts.

Fine Gael revealed that €2 million had been paid to Blackmore Group Assets Ltd, which it maintained was a shelf company based in the British Virgin Islands and administered from Guernsey in the Channel Islands.

The Irish Times understands that an investigation over recent months carried out in Ireland and in Bermuda by legal advisers to the HSE has been unable to determine the beneficial owners of the company.

However, it is understood that Blackmore Group Assets Ltd informed the HSE legal advisers in early February that no persons or corporate entities resident or incorporated in the Republic of Ireland had any shareholding in the company either directly or indirectly through nominees.

It also maintained that no person connected with the HSE had any beneficial interest in the company.

The HSE investigation confirmed that Blackmore Group Assets Ltd was registered in the British Virgin Islands but that it did not have a physical presence there.

Legal advisers commissioned by the HSE in Bermuda reported that the company had been incorporated in the British Virgin Islands on February 25th, 2002.

The Bermuda law firm told the HSE that it was not required in the British Virgin Islands for the register of directors and members to be made public or to be filed at the corporate registry.

The law firm said that no such filing had been made and that it was not possible, from publicly available details in the British Virgin Islands, to discover who held shares in the company.

It emerged last December that the Revenue Commissioners had contacted the HSE's office in Manorhamilton, Co Leitrim, seeking information and documentation about Blackmore Group Assets Ltd. However, it is understood that the HSE has received no further contact from the Revenue Commissioners.

A spokesman for Fine Gael said last night that a series of questions set out by party leader Enda Kenny last December remained unanswered. These included how a shelf company was awarded a €2 million contract.