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The communications regulator Ofcom has been asked to investigate how its Welsh branch awarded a contract to a company which has two senior officials on Ofcom’s advisory committee for Wales.

Plaid Cymru AM Neil McEvoy said it was “highly damaging” for the regulator’s reputation that Deryn Consulting had not had to submit a competitive tender before being given a contract by Ofcom to monitor the National Assembly and Welsh Government.

One of Deryn’s two directors – former Plaid AM Nerys Evans – sits on Ofcom’s advisory committee for Wales, as does Huw Roberts, the company’s chair.

Mr McEvoy asked Ofcom how much money paid to “lobbying companies or PR companies” in the financial year 2015/16 and 2016 to date.

He asked which companies had been commissioned, how much had been spent in each case, and what tender process they had gone through.

Ofcom responded: [We do not] use lobbying or public relations services. We do subscribe to services providing monitoring of proceedings, debates and Government announcements in Wales and UK-wide.

“For Wales, Ofcom subscribes to a monitoring service, providing monitoring of the activities of the National Assembly for Wales, the Welsh Government and other activity in Wales, provided by Deryn Consulting Ltd.

"The subscription began in February 2016 in advance of the National Assembly for Wales election.

“The decision to procure the service under a single tender justification from Deryn Consulting Ltd was on the basis that they were able to provide a bespoke service tailored to suit the specific needs of Ofcom in Wales: so, for example, monitoring of National Assembly for Wales committees is provided immediately after committee sessions.”

Ofcom refused to disclose the value of the contract, which began in February 2016, on the grounds of commercial confidentiality.

Mr McEvoy said: “There are well established rules for public procurement of goods and services. Under both the UK and EU legal frameworks public procurement must have free and open competition and demonstrate value for money. In fact, Ofcom says that its very job is to make sure that competition can thrive.

“But they’ve awarded a contract to Deryn, without any competition, where it just so happens that one of Deryn’s directors sits on Ofcom’s Advisory Committee for Wales. I thought the Closed Shop was stopped in the 1970s.

“It’s impossible to know whether Deryn offered the public value for money since no other companies were able to bid for the contract, even though there is no shortage of such companies.

“Overall, this is highly damaging to Ofcom’s reputation.

“It really is time to burst the Bay Bubble. The person on the street is getting tired of the cosiness and the constant stitch-ups amongst the Welsh political elite. How are they meant to keep faith in devolution when it’s increasingly looking like a closed club designed to benefit a privileged few?

“I’ve now written to the Heads of Ofcom for Wales and UK to ask that this matter be investigated. This is a very serious matter and I expect the highest level of sanction for those involved in bringing about the contract with Deryn. I’ve also asked that a new and open process for the contract be started.”

Huw Roberts said: “We are aware of Mr McEvoy’s continued interest in our successful and growing public affairs agency, and the excellent work we do with clients across the private, public and third sectors.

“Along with other reputable public affairs agencies based in Wales, we are members of the Association of Professional Political Consultants, and list all our clients on their public register. We have also made all relevant declarations of interest.”

An Ofcom spokeswoman said: “We make procurement decisions based on the specific needs of the business at any given time.”