The Audit Office of the Republic of Cyprus has released a critical report examining public procurement processes at the Agricultural Research Institute (ARI), identifying significant non-compliance with public procurement laws and principles.

The audit scrutinized procurement contracts 25/2023 and 40/2023, valued at €1.2 million for two years. ARI justified direct procurement from a single supplier, citing exclusivity in providing required materials. However, the lack of market research raised concerns about restricted competition and potentially inflated costs, with no evidence supporting the selection as the most cost-effective option.

Equipment procurement under tenders 19/2019, 9/2021, and 30/2022 revealed fragmented purchasing practices. ARI divided contracts into smaller parts, reducing competitive opportunities and potentially driving up costs. While equipment procurement reached €1.02 million, operational materials amounted to only €39,300, casting doubt on the strategy's efficiency.

Delays in evaluation and award processes were linked to irregularities in forming evaluation committees. These delays risked jeopardizing European Union grant funding, posing financial risks to ARI and public administration. The Audit Office also highlighted a lack of adherence to good governance principles as defined by national administrative law.

The Audit Office provided actionable recommendations to address these shortcomings:

• Thorough Market Research: Conduct detailed market surveys to ensure competitive pricing and cost-effective procurement.

• Integrated Procurement Processes: Combine equipment and material procurement to streamline management and reduce expenses.

• Compliance with Public Procurement Laws: Adhere strictly to legal frameworks, ensuring transparency and accountability in evaluation and award procedures.

• Enhanced Cost Efficiency: Implement best practices to maximize the value of public resources.