The UK government has suspended funding to the Commonwealth Secretariat after an audit found procurement rules were waived no fewer than 50 times.
The government will withhold its annual £4.7m voluntary contribution to the Secretariat, the central administrative hub for the Commonwealth, until the organisation meets conditions to improve its procurement policies, according to the UK’s Foreign and Commonwealth Office (FCO).
A FCO spokesperson said: “We are committed to an effective Commonwealth that delivers for its member states, so we have set a number of conditions on UK funding to the Commonwealth Fund for Technical Cooperation for this financial year.
“These include conditions relating to ensuring that the Secretariat’s procurement policy and its implementation are in line with international best practice.”
Last month, the Commonwealth’s Audit Committee criticised the secretary-general, Lady Scotland, for "circumventing" tendering rules and awarding a lucrative consultancy contract to a company run by a friend.
Auditors found a £250,000 commission was awarded to consultancy KYA Global, owned by Lord Patel of Bradford, to carry out a review of the Commonwealth Secretariat.
Commonwealth rules allow competitive tendering procedures to be waived in some circumstances, such as if there are not enough suppliers or a decision has to be taken urgently.
However, auditors found procurement rules had been waived no fewer than 50 times over three years. Some predated Lady Scotland’s appointment as secretary-general in 2016.
In a report seen by the BBC, auditors said they were “concerned that the acts and omissions ... as well as the absence of any explanation for those failures endangers the integrity of the Secretariat”.
“At the very least the failures identified risk serious reputational if not actual damage to the Secretariat."
New Zealand and Australia have also put contributions to the Secretariat on hold subject to financial procedures being reformed, according to the BBC.
A spokesman for New Zealand’s Ministry of Foreign Affairs and Trade told the BBC: “New Zealand has put on hold its voluntary financial contribution to the Secretariat until we receive independent confirmation the recommendations from the audit report have been addressed by the Secretariat."
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