The Ministry of Industry and Trade paid CZK 7 million for two IT systems: one system has not been launched yet, the other has not been used so far

PRESS RELEASE on Audit No. 15/12 – February 29, 2016


The Supreme Audit Office performed an audit at the Ministry of Industry and Trade and scrutinized national funds used for the development of informational systems and other ICT projects in the period from 2010 to 2014. In March 2015, the Ministry was using 112 various informational systems worth around CZK 345 million in total. Auditors focused on specific informational systems worth more than CZK 127 million and revealed that one of them was not used at all and another system had not been launched. Public contracts for IT systems and related services awarded by the Ministry were not managed and as a result, similar services were purchased for substantially different prices.

The Ministry of Industry and Trade spent CZK 7 million on two specific IT systems, which have not been used yet. One of them is the NECHELA system, which was designed to trade unused chemicals on the commodity market and should have brought more effective and favourable management with chemicals as well as reduced the amount of new illegal landfills. Since the NECHELA system’s launching in 2010, chemicals only worth CZK 13,000 have been marketed, with no deals at all since 2012. Already before the NECHELA system’s launching, the Ministry knew about the poor interest because of the very strict rules and lack of adequate legislation.

The other IT system acquired by the Ministry of Industry and Trade is called NEO and was supposed to help with trading of by-products and other products derived from waste materials thus contributing to more efficient waste management. In 2010, the Ministry paid CZK 1.9 million for this system, in spite the related legislation had not been prepared. The system was not launched until the end of the SAO’s auditing operation.

Auditors also focused on awarded public contracts that were related to IT systems and found out that individual departments of the Ministry of Industry and Trade decided to hire external companies for the administration of some public procurements. Prices of such services were quite different. For example, one company was paid CZK 35,000 for organising an open procedure in 2013, another company got CZK 90,000 for similar services. The prices of legal services varied from CZK 1,000 to CZK 3,000 per an hour. The Ministry used services of external companies for organising simple competitions, for instance procurements through the e-marketplace. The SAO thinks that simple contracts should have been administered by the Ministry’s employees, whose job descriptions included such tasks. The Ministry also should have managed procurements of services so that they would have had similar costs with various external suppliers.

Communication Department
Supreme Audit Office

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