I invite the Comptroller and Auditor General to introduce the report.
Special Report No. 5 - Garda Interview Recording Systems.
Mr. Purcell
This is a special report which incorporates value-for-money features. As a consequence, it might be more accurate to describe it as such. It sets out the results of an examination I carried out of the procurement of audiovisual recording equipment for use in the interviewing of suspects by the Garda Síochána. Its origins spring from concerns expressed by the unsuccessful tenderer about the fairness and objectivity of the procurement process. These concerns were reflected in Dáil questions, media reports and correspondence with the Department and prompted the committee to request me to examine the matter from a regularity point of view. I was also requested by the Secretary General of the Department to look into the matter.
The value of the contract awarded was €3.67 million for the supply of 252 audiovisual systems. The unsuccessful tenderer bid €2.87 million. My examination concentrated on two issues: whether the acquisition of the equipment complied with public procurement law and the extent to which the management of the acquisition represented good public procurement practice in terms of equity and value for money.
To address the first of these issues, I identified a number of key aspects of the procurement which are listed on page 18 of the report. I engaged the services of a legal expert to establish if there had been breaches of public procurement rules. The legal expert concluded that although there had been breaches of the rules in regard to the failure to publish notices and give adequate reasons for the award decision within the specified period, they were not of a nature that would have affected the ultimate award of the contract. I concur with this view.
That said, I am of the opinion that the procurement process could and should have been organised in a better fashion in the interests of fairness and transparency. In particular, the use of one make of equipment for pilot testing in the seven years up to implementation of the national scheme, including the purchase of six systems just two months before the tender competition, certainly ran the risk of influencing the ultimate award decision, given that the evaluation team comprised members of the Garda telecommunications section who would have had dealings with the successful bidder. In such a situation, it is imperative to provide for the utmost transparency and objectivity at the evaluation of tender stage in order to ensure decision-making is above reproach. I want to make it clear that I am not suggesting it was not transparent and objective but I would have been more comfortable about the award if the evaluation marking sheets had been more detailed and there had been an independent expert, say, from another police force, on the team.
From a value for money viewpoint, it probably would have been worthwhile to extend the pilot scheme to allow further consideration of the DVD technology option with all its attendant advantages. Some consideration was given to the possibility of taking the new technology on board but it was believed the time was not right. Speaking as a layman, at this distance it seems spending €3.6 million in the 21st century on 1970s technology was not the optimum way of proceeding, though I bow to the technical expertise available to the Garda Síochána.
In conclusion, I believe there are general lessons to be learned from this case, that national guidance should be updated to reinforce the integrity of the public procurement process and the attainment of value for money. I hope the thrust of the recommendations set down in chapter 3 of the report will be incorporated into the review of the 1994 procurement guidelines which, I understand, is being undertaken by the Department of Finance.
Does the committee have Mr.Daltons permission to publish his statements?
Mr. Dalton
Yes.
Does Mr. Dalton wish to make a statement on this issue?
Mr. Dalton
I have already given the committee a statement which I am quite happy should be published. When it became apparent to me that I was not satisfying the company concerned - the company which did not succeed in the bid - and that the answers I was getting from the Garda Síochána were not satisfying its concerns, on my own initiative, I asked the Comptroller and Auditor General to have the matter examined independently, either by him or someone nominated by him. We were not trying to conceal anything. I can fully understand the reason the company concerned was dissatisfied with what had happened. The answers I was providing were not satisfactory to it, which is the reason I asked for an independent assessment.
The Comptroller and Auditor General has mentioned the layman's view. Mine is equally a layman's view of what equipment is or is not technically sound. It is important to bear in mind that the steering committee involved included an independent expert all the way through who was an associate professor of engineering in UCD. He was included because of his expertise and was part of the team which recommended that we should stick with the equipment in place since 1994, that we should not go down the DVD route. I share the Comptroller and Auditor General's surprise at this but the view was that we had followed the right course. I cannot second-guess this, although I accept others may disagree. I am just saying what happened.
It is important to make the point that, while the Comptroller and Auditor General's expert advice is that there were breaches, there were no breaches of the rules that, in the legal opinion of the experts he engaged, actually affected the destination of the contract but, again, I cannot comment on this. I fully accept, as he does, that that is the legal view.
The other point I want to make, which I also made on the last occasion, is that for years the Garda Síochána has enjoyed delegated sanction in respect of these purchases. The Department is not actually involved, apart from the day on which it or the Government states, "You may do it", until the piece of equipment is in place. There is, however, a very important development taking place in this regard which I will not reject when it occurs, that is, the transfer of accounting officer responsibility to the Garda Commissioner as part of upcoming legislation to be introduced by the Minister for Justice, Equality and Law Reform. The Garda Commissioner is the person to whom all those dealing with these matters report on a day-to-day basis. This will be a significant development because somebody much closer to what is happening on a day-to-day basis with these purchases will answer to the committee.
The final point I want to make is that as a result of contacts we have had with the Department of Finance and the Garda Síochána, a set of proposals has been put to that Department which provides for - assuming it agrees; it will probably have no difficulty in agreeing with some of them in view of what happened in this case - independent expertise in the evaluation of all large tenders. Representatives of the Garda tendering office will be present on evaluation teams in respect of procurements worth more than £75,000 to ensure procurement procedures are followed.
There will be new divisional procurement committees to approve smaller purchases with training provided. The financial limits in respect of delegated sanction will be dependent on the outcome of the procurement process. This means that if the Garda Síochána goes for anything other than the cheapest tender, the level of delegated sanction will drop. The figure will be €162,000, provided it opts for the cheapest tender. If it goes for something other than the cheapest tender, the figure drops to €50 at which stage the matter would have to be referred to the Department.
I have nothing further to say at this point.
On the Comptroller and Auditor General's point about the 1994 tender specifications for the purchase of technical equipment in 2000, it is like buying a 1994 computer without Internet access capability in 2000. Do you think it is sufficient that members of the GardaSíochána have to use up to 20 VCR tapes to record one interview?
Mr. Dalton
The equipment in use was recommended by the team set up to examine the introduction of the system. I cannot go beyond this. Obviously, on the face of it, from a common-sense point of view, I can see the point you are making. All I can say, by way of explaining what happened, is that the explanation is that we had a team with independent expertise which specifically considered and decided against DVD.
On the point about video tapes, is the equipment now in use obsolete? Is it correct that one interview relating to a simple crime can require a box of tapes and is recorded in triplicate?
Mr. Dalton
My information is that the system is working quite well. More than 20,000 people have already been recorded - however good or bad the tapes are. In some cases the sound is turned down because people do not wish to be recorded. A total of 20,000 interviews is not bad. Solicitors are full of praise for the system because, in their view, it is a marked improvement on the situation where nobody knew precisely what had happened in the making of statements. There were a lot of arguments about what had actually happened when somebody was taken in for interview. It is now all on tape. Perhaps the interviews could be recorded on DVD but the fact is that 20,000 people have used the system. Tapes have been used in 44 court cases, including one murder case. Even though it might be more efficient to use DVD, the system as a whole is working quite well.
If a person leaves the room, the tape is stopped and a new one put in. I believe those being interviewed are very much aware of the deficiencies in the system. In some cases up to 80 tapes can be required.
Mr. Dalton
I do not know what the views of the people you interviewed are because I have not done any analysis. All I know is that 20,000 people have submitted themselves for this process. Personally, I have not received any complaints about its efficiency or otherwise. Therefore, I cannot comment.
When will we get information on the number of interview hours recorded in 2002 and 2003?
Mr. Dalton
I will try to get it. I do not have the figure for the number of hours recorded, just the number who were interviewed. As I said, it is 20,000 odd.
Which company was awarded the contract for the supply of tapes?
Mr. Dalton
SKS Limited.
Did it cover the supply of tapes also?
Mr. Dalton
Sorry, I do not have that information.
Is it possible to furnish the committee with a copy of the contract for the supply of tapes and details of the numbers of tapes used in 2001, 2002 and to date in 2003?
Mr. Dalton
I see no problem with furnishing that information. I do not have it now.
Was there a public tendering competition for the supply of tapes?
Mr. Dalton
We will supply that information.
Listening to the Chairmans comments in regard to changing technology, it crossed my mind that it might be good practice to include a bright 16 year old in all further expert committees advising on these matters. I received DVD equipment about three years ago and do not believe it was possible to record on earlier models which just had a playing facility. However, it has now advanced to the point where it is self-evident that a DVD system has enormous advantages over a tape system. I would not be surprised if we had to go to tender again soon in to change the system.
This is an interesting case and an interesting report. While the Comptroller and Auditor General says there was no material contravention of the legal requirements of public procurement, he also looked at the issue of good public procurement practice about which issues arise. I am not sure who should answer my first question. Is there a protocol within the Garda Síochána that gives guidance to those involved in the evaluation of a pilot project such as the ones we are discussing and on subsequent behaviour in going to tender for equipment to be used nationally?
Mr. Dalton
My understanding of the position is that in this case everything was left to the expert committee. A recommendation had been made that we should go down the road of video recording. A committee was established with expert help which recommended that particular equipment should be acquired. I am not aware that there was any protocol which would have guided them in a different direction. What is interesting is that although the committee subsequently recommended that the same make and model should be used - in other words, SKS equipment - the Garda Síochána did not do this. It went for the same specification but not the same make and model. The result was the same - it was still SKS equipment, which probably was not surprising given the terms of the specification. No, I am not aware of any protocols. While there would have been general procurement guidelines, everything in this case emanated from the recommendations of the committee.
If I recall correctly, the report stated the chairman of the expert committee had informed the Department that, while the committee did advise on technical matters and the issue of the best equipment, actual procurement issues were matters for the Garda Síochána and that the committee was not involved in any way in the implementation of procurement. Is that correct?
Mr. Dalton
That is true, except that while the committee was not involved in the process of procurement, it was involved to the extent of stating what should be procured.
One of the issues arising in this regard is the possibility of a close relationship being established, in the course of evaluation of the pilot projects, between the Garda Síochána and the evaluation section and the principals in SKS. It appears to be quite normal in organisations such as the Garda Síochana to move from a pilot project to a general tender. Is there any guidance on best practice in circumstances where, inevitably, a close professional relationship will develop if the very same people are involved in assessing a tender as were involved in assessing the efficacy of the pilot project?
Mr. Dalton
I fully accept the point made by the Deputy which relates to one of the real criticisms of the system. Obviously, there was the possibility of a relationship developing in the circumstances described. That is the basis for the Comptroller and Auditor General's statement that it was poor procurement practice, even if one cannot establish anything as a matter of law, which I believe would be extremely difficult to do, in the absence of evidence that there was collusion. I fully accept, in the context of moving from pilot scheme stage to procurement, with the same people involved, the risk is high. That is the reason the procurement process is to be changed in order that evaluations will no longer be made only by members of the Garda Síochána but will, in all cases, include an independent presence.
In public procurement matters involving the Garda Síochána, is there a protocol governing the possibility of personal relationships, either social or business, between principals of tendering companies and gardaí evaluating the relevant tenders?
Mr. Dalton
The general law on the matter, particularly the Ethics in Public Office Act, on which I am not an expert - the Department of Finance would be more knowledgeable - assumes that, in certain situations where people do not declare connections and so on, they are committing offences. I am not aware of any particular set of rules dealing with the matter and do not know if any of my colleagues are so aware. The Garda Síochána would be bound by the general procurement rules applicable to public purchases. I do not believe there is a system that would have guaranteed, in a foolproof way, that if somebody had a relationship with the successful company, it would have been detected. I do not believe there is such a system in place.
Are you aware of the Sunday Business Post website, The Post, which, according to information distributed to members of the committee, posted an article on 16 December 2001, written by journalists Barry O’Kelly and Simon Carswell? The extract with which I have been provided refers to a Mr. Harry Smith, chief executive of SKS, stating:
Separately, Harry Smith of SKS defended a testimonial on his company's website from Superintendent Noel B. Geary, which states: "Their after sales service is excellent and the company possesses the ability to respond to and complete projects quickly, efficiently and cost-effectively".
Perhaps that has been taken out of context - I have not been in a position to check since receiving this extract this morning. However, the tender seems to have been awarded in March 2001. The item I have quoted was posted on the website in December 2001 but refers to a testimonial posted on the SKS website some time prior to that. I am not too sure whether it was contemporaneous with the tender process or occurred before or after that process as I have not been in a position to research the matter more fully this morning. However, it would have been unusual that a key garda in the evaluation committee assessing the tenders had posted a testimonial on the website of SKS. Do you have any information on this?
Mr. Dalton
I do not but can understand the Deputy's concern. I would have to inquire into the circumstances. I do not know if the report is true or whether any defamation proceedings are contemplated, as one would expect if it was defamatory. I just do not have the facts in that regard but will make a report to the committee on the matter.
Does Mr. Culhane have any information on the matter?
Mr. Culhane
Sorry, I have no information on it.
As I see it, the key issue in this regard arises from the fact that——
We appreciate that the information is not available today and that Mr. Dalton has undertaken to report back to the committee.
Mr. Dalton
Yes, I will. I am conscious that, in this case, there is a possibility that somebody has been defamed or the report may be absolutely true - I wish to be careful about the matter. However, I will come back to the committee on the matter.
I also wish to be careful about it. I am giving the report as is, without making any allegation whatsoever. However, the question has to be raised and answered, one way or another. If it is not raised here, it will not be raised anywhere else. The key issue arising from the report is as to the reason a company which had submitted a tender in excess of €800,000 more expensive than another was selected. I know it is common practice in public procurement, across the public service, that issues other than price are taken into account and that it is not unusual for a more expensive tender to be successful, because the overall economic advantage has to be taken into account. However, when a more expensive tender is accepted, it has to be seen to be more advantageous.
The key to establishing this lies in the evaluation system which the Comptroller and Auditor General has set out on page 28 of the report. There are seven criteria given percentage weightings - 35%, 20% and a series at 10% and 5% for ongoing cost and maintenance contract. This was part of the original tender specifications published in the request for tender. The Comptroller and Auditor General has said the actual paperwork which supports the allocation of percentage marks to each of the tendering companies is quite sparse and that there does not appear to be sufficient documentation to make it possible for somebody to re-evaluate the basis for allocation of the marks.
A number of issues which arise have importance in bringing forward new rules and regulations on procurement. For example, there is a section dealing with the assessment of equipment in the course of which marks were awarded and a further section on assessment of the companies' ability to install equipment. In the case of SKS, the company appears to have been credited twice in respect of the same work. While the Neal equipment was installed for one of the constabularies in the United Kingdom, it was not done by SKS. There was a double counting in the evaluation criteria. It was credited twice, once when the evaluation committee assessed the efficacy of equipment installed by a constabulary in the United Kingdom. It was subsequently credited with its technical ability to do the job, even though it had not installed the equipment. There was an element of double counting. It seems to there is a factual flaw in the evaluation in that respect. It is a moot point whether it would account for the discrepancy of about 10% - I do not think it would.
The difference in the cost of training is referred to by the Comptroller and Auditor General in paragraph 2.59 on page 28 of the report on Garda interview recording systems. The Garda Síochána points out that the AV Niche costs for training were €254 per person, compared to SKS's quotation of €736 per day. SKS came out on top under that heading. If one examines the AV Niche correspondence circulated to the committee by Mr. Holmes and one goes back to the request for tender document, it is clear that like is not being compared with like. Apples and oranges are being compared in the Garda statement to the Comptroller and Auditor General. The tender document required an estimate, a procedure and a costing of training operators to operate the equipment subsequently. That is the AV Niche cost, whereas SKS was talking about directly training the operators. It seems there is a flaw in the manner in which merit marks were awarded under a heading in the original document. Apples and oranges were compared. It seems AV Niche, rather than SKS, complied with the requirements of the tender document in that respect.
A third series of issues arises in the section of the report relating to the views of the Garda Síochána on suppliers' capacity. The bulk of the marks were awarded under these headings. The report states the Garda Síochána checked references supplied by AV Niche but the correspondence supplied by AV Niche denies that referees were ever nominated. It simply gave a list of companies, concerns and organisations for which it had done work. It did not nominate the organisations as referees but mentioned them in the context of providing a record of its previous work. It has been stated references were supplied by AV Niche. A great deal of charge and counter-charge is involved in the views of the Garda Síochána on the supplier's capacity and the comments now being made by AV Niche. I do not think it is possible for this committee or the Comptroller and Auditor General to establish the facts.
One of the requirements under the EU directive is not only that public procurement be done properly and in a manner that is above board and transparent but also that it be done in a manner that diminishes the number of claims of abuse. Not only has justice to be done it also has to be seen to be done. It seems the procedures adopted in this case were very weak, as it was not absolutely clear subsequently that everything was above board. The letter circulated by our legal adviser, read out at the start of this meeting, inhibits us to some extent in pursuing the matter further. Clear matters of fact are being contested which are relevant to the weightings given, from which the tender came. The application of the criteria on page 28 resulted in SKS scoring about 80% and AV Niche about 71%. That is the net point. We are probably talking to the wrong people because those who can answer the questions are not here.
A serious issue arises if it is demonstrable that the decision made is not in accordance with the facts, under two of the seven criteria, there is a mis-statement about references in the case of another criterion and there is a great deal of contention in relation to the key areas of the evaluation. It is very difficult to be happy about this matter. I will allow Deputy Curran to speak, although I may have another question later.
Mr. Dalton
Does the committee want me to comment briefly on the points made by Deputy Noonan? I agree that the procedures used in this case were unsatisfactory - there is no question about this. That is the reason different procedures are being put in place, as recommended by the Comptroller and Auditor General and has emerged in consultation between the Department of Justice, Equality and Law Reform and the Department of Finance. I agree that there are many reasons one might have doubts, from a purely common-sense point of view, as to whether matters were conducted with absolute propriety. It is important to make the point that having reservations as to whether matters were conducted with propriety is different from having proof which I do not have.
I do not want to give anybody the impression that from everything here there is the basis for legal action. I say this, in particular, in relation to AV Niche which will be taking its own legal advice. I am not in a position to make a comment about the matter. I am relying on the conclusion of the Comptroller and Auditor General, which was that nothing that had happened affected the destination of the contract. He received a legal opinion to this effect which I am not in a position to query, nor do I intend to.
Deputy Noonan raised the issue of the points of evaluation. As I understand it, the Comptroller and Auditor General was concerned mainly by the lack of records in relation to 45% of the evaluation. I may be wrong but I believe the aspects of the evaluation which comprise the 45% are technical merit, extent of compliance and costs of desirable options. I cannot argue with the statement that the documentation was inadequate. I am not in a position to discuss the issue of double counting as I do not know about it. The Deputy may well be right. I have not examined the issue of training in great detail unlike those who did - they are not here, as Deputy Noonan said - but it also occurred to me that it looked as if there might have been an "apples and oranges" approach. One organisation spoke of a cost per day for supervisors, as I understand it, while the other spoke of a cost per person for operators. They are two different entities.
I do not think I have anything else to say. I accept the point made about the EU directives, the purpose of which is to ensure there is fairness, that the fairness is transparent and can be established by reference to the available documentation and records. We did not and do not have it. I can see that there is conflict on various points such as the matter mentioned by Deputy Noonan. There is still conflict as to which side is presenting the full facts; I cannot adjudicate on the matter. There was conflict in relation to other issues, one of which - the question of whether AV Niche had provided an important computer chip - I examined last night. One side seems to be saying the chip was unnecessary while the other seems to be saying it was supplied. I accept there are conflicts along the way but do not know how they will be resolved, although we will do our best to do so. If the Comptroller and Auditor General or the committee wishes to send a person of their choosing to re-examine the matter and ask many questions, I will have no difficulty with it.
Thank you, Mr. Dalton. I seek clarification from the Department of Finance of the national guidelines of 1994 which clearly specified that conducted pilot testing should be done in a manner which both allowed and encouraged the identification of a wide range of possible and acceptable technology solutions or equipment options. They also referred to drawing up appropriate specifications, specifying evaluation schemes, creating balanced evaluation teams which could be demonstrated as being simultaneously expert and objective and complying with the provisions of public procurement law. There is a total abandonment of adherence to those regulations. Was the Department happy with the fact that none of them appeared to have been complied with under the 1994 Act?
Mr. Errity
I will ask my colleague, Mr. Noone, who works in the public procurement area, to deal with that aspect.
Mr. Billy Noone
The Department of Finance notes the recommendations in the report, particularly those that relate to improvements and areas where better guidance might be issued. As the Comptroller and Auditor General indicates, the guidelines are being revised and are at final draft stage. The five or six issues mentioned in the report and by the Chairman are being addressed.
Why were they not addressed in the contract?
Mr. Noone
The contracting authority has to answer that question. It is not a matter for the Department of Finance. The existing procurement rules are general in nature. They are being improved and expanded.
Is a cross-check on procedures not done by the Department of Finance with relevant Departments to ensure public tenders adhere to the guidelines enshrined in legislation?
Mr. Noone
There was a checking procedure by the Government Contracts Committee, GCC, in the case of contracts awarded to a bidder whose bid was not the lowest. Of necessity, monitoring by the GCC is very broad. It checks to ensure the fundamental principles of an open, objective and competitive procedure are adhered to. On the basis of a submission to it, it considered in examining this project that it had met basic rules and requirements.
Do you agree this was a loose arrangement and that there was no adherence in any sense to any of the guidelines?
Mr. Noone
I would not say there was no adherence to any of the guidelines. There was a competitive process which was advertised and a number of tenders were received. This was all indicated in the submission to the Government Contracts Committee. The Comptroller and Auditor General's report indicated shortfalls but they were not material. We are concerned that any departure from best practice and procedure should be avoided. This is being addressed in expanded and up-to-date guidelines.
I agree with the Comptroller and Auditor General on the whole aspect of transparency with regard to this tendering procedure. I must preface my remarks by saying I have been a Deputy for a little over one year - I am a rookie TD - prior to which my background was in the audiovisual business. I was a partner in a company for the best part of 20 years. As it is a small industry in Ireland, I am familiar with SKS in the sense that I would have viewed it in many ways as a competitor in certain areas of our business.
I want to make one or two general comments before I examine the detail. There are no industry experts in the way that people think of them. With the advances in technology, most of the expertise lies with the manufacturing companies developing the technology. By and large, this is passed down to distributors like SKS which is how it finds its way into the marketplace. It is difficult to set technical specifications when going to tender. That is the normal procedure. I am concerned that the pilot scheme, which dates back to the early 1990s, ran for too long because as all of us know, the technology evolved considerably over that period. Issues arise as to the reason the scheme was allowed to run for so long.
Mention was made of the use of DVD versus tape. I do not have a problem with the use of the ordinary tape because while at some point it may be decided to change to DVD, hard disc or another storage format, most of the production end, in terms of cameras, microphones and control equipment, will still be operational. It can be transferred without significant cost which is desirable. However, I am not concerned about that aspect.
I mentioned how the industry works. When somebody wants to design an audiovisual system, the initial design tends to come from an audiovisual company such as mine, SKS or another and subsequently goes to tender in the marketplace. The reality is that whoever has the first shot at it has a competitive advantage. That appears to be what happened in this case. There is no question that the company knew the system in detail and I am surprised the pilot scheme was let run for so long. What I cannot understand is the reason, in the early days, it was not examined in terms of a foreign jurisdiction. One should have picked a particular standard that was working well and then gone to the market to see what it would have delivered in terms of price, service and availability. It is not necessarily the case that all product available in every country will be easily accessible here but this system does not appear to have complied from the point of view of transparency and good practice.
I want to ask one or two specific questions. It is my understanding that, separate to this, SKS would have done other jobs for the GardaSíochána and the Department of Justice, Equality and Law Reform. Is that correct? This would not have been its first and only contract.
Mr. Dalton
No. I also asked that question. It has not done many others. It has been heavily involved in the provision of CCTV in various towns. In fact, it has succeeded in all but one tender competition for CCTV in Dublin, Cork,Limerick, Bray, Galway, Dundalk, Finglas and Dún Laoghaire. Westinghouse was involved in the project in Tralee.
How many did SKS get?
Mr. Dalton
Twelve.
That is a great hit rate.
Mr. Dalton
It is. I asked a few days ago the reason Westinghouse had got in under the rug on one occasion. Apparently, it offered a better price in Tralee for reasons of which I am not aware. It did not offer as good a price elsewhere, also for reasons of which I am not aware.
I am not here to adjudicate on that aspect. I am merely making an observation. As a matter of interest, when did SKS get its first contract, or whatever way it might have been determined at the time, with the Department?
Mr. Dalton
I do not know but the CCTV contract dates back to 1994, around the same time as the other contract.
Perhaps you can clarify something about which I am a little unsure. If my understanding of the report is correct, in 1993, before any real standards were put in place or the pilot scheme was initiated, a system was fitted in Tallaght Garda station. Is that correct?
Mr. Dalton
Yes.
This system subsequently became the basis for operating a pilot scheme. Is that correct?
Mr. Dalton
As I understand it, yes. The equipment purchased first was not purchased out of a relationship with SKS, rather it was a purchase of Neal equipment - the manufacturer. The company involved in 1993 was SVT, while it 1994 it was Neal with SKS. I understand Neal is the manufacturer, while SKS is the supplier-distributor here. The brand name is what the committee was interested in, for which SKS seemed to have agency rights here. As the Deputy says - I will have to bow to his greater knowledge on this subject - from its dealings with Neal, SKS obviously acquired all the relevant technical knowledge. I presume this is the reason, in an unusual event, when AV Niche expressed an interest, it was automatically referred to SKS. I do not believe this was done out of malice but because the company was assumed to be the resident expert. It did not have any such relationship. I believe that is how it happened.
We should not overstate the case that the technology involved is overly complex as it is ten or more years old and relatively straightforward. There would be numerous competent suppliers or installers of similar type equipment in Ireland, the United Kingdom and elsewhere. The technology is relatively straightforward in this day and age. I am concerned about the reason the pilot scheme ran for so long.
Mr. Dalton
I do not know the reason. My recollection, which I will have to confirm, is that there was a remarkable lack of enthusiasm to use the equipment at the beginning on the part of those being interviewed.
Was it not more a question that one may never take that route?
Mr. Dalton
Yes. Some criminals are not happy about using this kind of equipment. In fact, one of the objections to introducing the system at the beginning, made by police members both here and in Northern Ireland, was that serious criminals were very shy about appearing on video because they liked to know for sure where such a video would end up. I do not know whether the 1,300 who have refused to appear on video so far are the kind of criminals in whom people would be more interested. That is possible as the more serious or subversive criminals have a distinct dislike for this kind of technology. Obviously, one has better opportunities to say something did or did not happen when one does not have a machine in the room.
Therefore, the period in question was not necessarily an evaluation period for the equipment, it was more a question of whether the system would be adopted.
Mr. Dalton
Yes, apart from technology considerations, the single piece of equipment was not providing sufficient information on the usefulness of the system or its likely take-up. However, there has been a significant take-up of around 20,000 cases - a significant number.
On the whole area of technology and preparing tender procedures for the future, what procedures has the Department put in place to put distance between those designing a system and those who may subsequently supply it?
Mr. Dalton
I outlined some of the procedures. Whether it captures the point about the relationship between the designer and supplier——
If one opts ultimately for an independent design by a particular distributor, it will be designed with its product range in mind. One does not, therefore, have independence, if you understand the point I am making.
Mr. Dalton
I do. Various proposals have been put to the Department of Finance about independence in evaluation and so forth. I accept, however, that evaluation might be too late.
That is the point, an evaluation is too late because the game is up, the contract has been awarded and the company in question can only supply what it has available to it.
Mr. Dalton
I will take up that point in our correspondence. Generally, it is being attended to in redesigning the procurement rules. We will certainly pursue it.
I see two or three major problems with this deal. Having read the brief and listened to the discussion, if I was a member of the company which lost the contract, I would be extraordinarily upset and sore about it for a number of reasons, one of which is a technical matter which I gleaned from the correspondence. Just before the contract was either accepted or announced to the successful tenderer, I understand cupboards or storage facilities were installed in Garda stations which would have met the overall dimensions of the equipment used by SKS, whereas the equipment tendered for by AV Niche would not have fitted into them. I assume the Office of Public Works carries out work on Garda stations. You may argue this is a small technical matter but it is a major concern if Garda stations were fitted out to take a particular type of machinery and would not have accommodated the equipment of an unsuccessful tenderer. I understand the losing company was told this was one of the reasons its equipment was too large, cumbersome or would not fit. Will you clarify whether the fittings were carried out in local Garda stations before the contract was announced?
Mr. Dalton
This is the first I have heard of this. I had not heard that the Office of Public Works prepared Garda stations for a particular piece of equipment. Perhaps the Office of Public Works——
Can anyone give us an answer?
Mr. Ryan
I have no knowledge of the building operations of the Office of Public Works as I work strictly in the area of procurement.
You are not involved in the contract.
Mr. Ryan
No.
Is there anybody present who can answer my question?
Mr. Dalton
We will find out the answer. If the Deputy's suggestion is that the matter was set up in advance, it would be serious. We will have to find out whether it is true, as I do not know.
I would like an answer to the question.
Mr. Dalton
We will get it.
The dogs in the street were aware at the time of a concern that before the contract was announced a high ranking official or executive in SKS had supposedly informed the company not awarded the contract that whatever else happened, it would not get the contract. Did you or any other witness hear this comment?
Mr. Dalton
No, I did not but would be interested in finding out more.
While I am not able to say for certain that it was made, I ask the question because if it is true, it appears to show that there was a fait accompli before the tenders were opened.
Mr. Dalton
The company concerned - I presume AV Niche would be best placed to confirm the suggestion - has not made any such statement in any correspondence we have received. I am, however, open to correction. If it makes such a complaint, we will investigate it.
While I do not want to go over old ground again, I wish to raise the question of the lead-in time for the equipment which extended for a period of nearly seven years. Although Deputy Curran covered this issue, it brings me to another point. I am not as familiar as the Deputy with the technical aspects of the matter as he is involved in the business. When the steering or expert committee delivered its judgment that the equipment to be used was that already installed - in other words, it was satisfied with the Neal equipment - was AV Niche given only 21 days to meet the specifications required, whereas the other company involved would have had five, six or 12 months to meet them? Is that correct? Was the matter handled unfairly?
Mr. Dalton
This is one of the matters subject to disagreement and I am not in a position to make a judgment on it. The Garda Síochána states that while, the company in question was formally notified, it was aware from September, that is, for two months rather than 17 days, that it might be asked to produce equipment for evaluation. I am not in a position to say if two months is a reasonable period, to criticise or disagree with what AV Niche is stating, or ascertain whether the Garda version is correct. As Deputy Noonan said, there are several points on which there is a conflict of information, the reason I would have no problem if the committee wanted somebody else to examine the matter.
From what I have heard, it seems terrible holes have been shot through this transaction and it is frustrating and unsatisfactory that the people who might be able to answer the pertinent questions are not present. I am not entirely sure, on the basis of what I have heard, how either the Comptroller and Auditor General or the accounting officer can conclude that the destiny of the contract would not have been affected. I am sure that the Comptroller and Auditor General has, as usual, made his assessment by reference to documents and do not believe interviews would have been held with the other tenderer, for example. We ought to seek to involve some of those directly concerned.
Although I know he is the accounting officer, I am reluctant to ask Mr. Dalton questions he cannot be expected to answer. Did he say to Deputy Noonan that he did not know about the testimonial posted on the website of the company in question?
Mr. Dalton
I did not know about it.
It is not just a matter of not knowing about its content. He knows nothing about the scale of the preparations made to accommodate the recording facility in Garda stations, a matter raised by Deputy Connaughton.
Mr. Dalton
Absolutely not but it is checkable.
Regarding the lengthy evolution of the technology in question, I have a copy of a letter dated 26 April 2001 forwarded by AV Niche, which Mr. Dalton might have long forgotten as you get a lot of letters. In respect of the tender for the supply and installation of interview video recording equipment the letter stated: "I am writing to advise you of the existence of CD video recording technology, which will have considerable benefits in the management and ongoing cost savings in relation to a national interview video recording programme". It listed 12 reasons the technology being brought to your attention had advantages over that being tendered for, including an 85% reduction in ongoing management and archive storage costs and a 50% reduction in ongoing operational costs. Moreover, it stated the CD technology was at the beginning of the technology life cycle whereas video cassette recording was at the end. It concluded: "Whilst it is appreciated that the tender process is still current, AV Niche Recording Systems Limited believe that it is our commercial responsibility to advise you of the above so that the risk of an uninformed commitment to a less efficient technology is minimised". Does Mr.Dalton recall this letter?
Mr. Dalton
Yes. I certainly know that DVD was proposed as I believe I stated earlier. The Deputy is correct in stating I receive a large amount of correspondence on all sorts of issues, regarding which I ask for comments from the Garda Síochána. This is normal procedure because there is no way I can check such matters. I know that the DVD issue was examined and that the committee, which we regarded as independent and expert and from which we were receiving advice, advised that it should not be adopted. The reasons for this were that considerable work had been done in respect of video recording equipment and that it would suffice. Deputy Curran shed much light on this issue when he said that it was not necessarily fatal to continue with the existing equipment, which would have been easy to adapt at a later date. I thank him for this information.
Does Mr. Dalton believe Deputy Curran's expertise was in the minds of those who made the decision?
Mr. Dalton
No. The people who made it made their decision on the basis of a recommendation from the committee which stated we had come a long way with the existing equipment over the course of seven years and should complete the project rather than cause considerable delays by starting again. This may have been a misjudgment - I do not know. I understand the points made by AV Niche.
As Deputy Noonan and the Comptroller and Auditor General stated, clearly, DVD has many advantages. It is more advanced than video in terms of storage and, probably, quality. I am sure there are many more reasons. As accounting officer, all I can do is state DVD was considered but not opted for at the time.
You did not know about the three week deadline pertaining to AV Niche, of which Deputy Connaughton spoke.
Mr. Dalton
I came to know about it while preparing for this meeting and would not have known about it as a matter of course. It may well be the case that this information was contained in the letter from AV Niche but I cannot recall. There were many items of information contained in it.
Deputy Noonan stated if he was involved with AV Niche, he would be very concerned, as would I but I can proceed only on the basis of the facts available to me. As I stated, I do not want to do anything that would give anybody the impression that I believe there is a basis for legal action. The legal expert employed by the Comptroller and Auditor General has drawn the conclusion that there is. However, I have reached no such conclusion but have no basis for disagreeing with it. I have taken no advice on the matter, nor would I unless legal proceedings were pending.
Mr. Purcell
In case there is any misconception about my view on the matter, I stated in the report and my opening remarks that the procurement process adopted by the Garda Síochána leading up to the eventual award of the contract to SKS did not give rise to a material breach of public procurement rules. We are talking about law in this case. However, I also stated I was somewhat concerned about the way in which the procurement process had evolved from a pilot scheme testing process. That is where there is a difficulty which is not clarified in law. I am not saying everything was spot on, as I would expect in public procurement practice, but that where there were breaches of the law, they were not material in the sense that they affected the ultimate award of the contract. I want to make that absolutely clear.
I am not concerned one way or the other about AV Niche as I am sure it is well able to look after itself. I still know very little about this matter but would know even less were it not for the information furnished to me by the company, at which I only had time to glance. Therefore, I am concerned, having regard to the fact that we have just dealt with the tyres issue on which I would have liked to ask some questions but I had to leave because of a Dáil division. However, I will not reopen that matter. Arising on the same day and without the persistence of AV Niche, one would not know anything about this issue which raises questions about procurement procedures in the Garda Síochána.
I do not know whether it is the case that a relationship was established - in the Irish way - between the purchasing officers in the Garda Síochána and a particular company or whether it is more serious than this. It is very difficult to make a judgment. Deputy Curran has just advised us that whoever was in control of the design would obviously have designed for their own product range. It is clear that the relationship with the company in question dates back to the early 1990s. Deputy Connaughton has said it was brought to his attention that a remark had been made to AV Niche before the contract was awarded. Various matters have been tested by Deputies Noonan and Curran. It may be the case that nothing more than a relationship was established but even on these terms, in terms of value for money, efficiency and so on, there appears to be cause for concern. Does Mr. Dalton accept this?
Mr. Dalton
Yes. The reason we are changing the procedures is the ones in place are unsatisfactory. I accept there are suspicions and concerns but I am also saying that, having gone this far, I do not have the evidence to confirm whether any of these suspicions has substance. What I would not like to do - I know I am repeating myself - is give anybody the impression that the suspicions are sufficiently well-founded to justify taking what could be a very expensive course of action. I am not saying they should not do so but I would not want any statement of mine to give the impression that I have knowledge which suggests there was legal wrongdoing in this case that could attract damages. I do not want to give that impression. It would be totally of wrong of me to do so.
I understand the reasons there are concerns. In many areas of life we have concerns about something that looks shady or does not look right but that does not necessarily mean we have sufficient confidence to go to court and establish it, although it may be the only way all the facts in this case can be established. I would not encourage anybody to take that course because, generally, in court cases such as this one has to be on fairly solid ground before one has a chance of establishing it was worth one's while going to court. I do not have the evidence, beyond concerns about procedures and concerns I would have if I was involved with AV Niche that it does not look right. Whether any or all of this amounts to a sufficient basis in law to establish there was wrongdoing, I do not know. If I had the knowledge AV Niche now has, I would not be litigating. I would want a lot more.
I am not sure we can make comparisons with other walks of life. We are talking about the Garda Síochána, not the casino owners association - there is a difference. Am I correct in reading the Comptroller and Auditor General's report as meaning that in August 1993 the units in question cost approximately €8,000 but that by November 1994 they were costing €12,000? In January 1998 they still cost €12,000. However, two years later, in 2000, they were costing £18,000. It is stated on page 14 of the report, ". . . in June 2000 to six more locations . . . Six audio-visual systems were purchased at a cost of €109,027". I make that €18,171 each.
Mr. Dalton
I think that is a correct conclusion but I cannot comment on whether the prices were reasonable as I do not have enough information.
Mr. Purcell
They are the figures. It was in the context of there being no tendering, certainly at the later stage.
Thank you. Reading the literature, one gets the impression that SKS was acting almost as an agent for the Garda Síochána. How did it come about that it appeared to be confident it had the contract in its pocket and was going to try to source the product elsewhere as if it had that kind of relationship?
Mr. Dalton
That was unfortunate. It was the case that AV Niche appeared to have been led to believe it was virtually in a consultancy position. Deputy Curran threw significant light on this when he said those who get in initially with the specification inevitably get on the inside track, regardless of the business involved. I think that is what happened in this case. There was no contractual relationship to provide consultancy advice. In fact, what I recall happening is that when SKS was informed of AV Niche's interest, it asked it to supply equipment which must have given the impression that there was a consultancy arrangement, an issue that is in dispute.
There are some references to correspondence between AV Niche and SKS, on which I am not in a position to comment, which suggest that there was probably a better understanding of each other's relationships than other information tends to suggest. There is a suggestion, which AV Niche may well dispute, that at one point they may have been contemplating a business relationship with each other, which probably goes a little against AV Niche's sense of hurt in all of this. I am not saying it is a sense of hurt that is not understandable but there appears to have been other correspondence. I cannot comment on the propriety of the ways by which it got into the system. AV Niche makes the point that the only way it could have got into the public domain is if the Garda supplied it but the reality appears to be that there is correspondence which suggests that AV Niche and SKS were not entirely innocent in respect of each other's relative position. I do not know if I can put it very far beyond this. What is certain, in so far as anything can be, is that they were not contracted as agents for the Garda Síochána.
Does Mr. Dalton agree that, despite what Deputy Noonan said about the public procurement process not involving an obligation to accept the lowest bid, a figure of €800,000 on a contract worth €3.6 million is a hell of a difference, one which would need to be capable of being defended?
Mr. Dalton
Absolutely. The difference between the two prices underlines the case for having a transparent and independent assessment. It is quite a significant amount.
I am sorry to ask again the reason it took seven years to pilot the scheme. Is Mr. Dalton saying it may have been delayed by policy?
Mr. Dalton
I will need to check but my understanding is there was an under-use of the system at the beginning. Those expected to use it - criminal suspects - were not all that keen. The view was that it needed to be expanded to further stations to establish whether it ought to be proceeded with. My recollection is that there was disappointment at the level of take-up. The belief was that it would be welcomed by those allegedly suffering considerably at the hands of gardaí in interviews. One would have expected a high degree of enthusiasm for this kind of equipment. However, in reality, people were not wildly enthusiastic. This was particularly the case where people had been making up stories about what had happened during interviews. The Garda Síochána has come to value the equipment because it eliminates a whole line of defence which was much more fertile in the past.
Our concern is somewhat wider than just the matter of the reason the process continued for seven years. We have had experience of the PULSE system in more recent times and a view is now being formed that the Minister for Transport is being obstructed in the implementation of the penalty points system. Public statements have been made about the use of biros, rulers and pieces of paper, indicating that the Garda Síochána cannot move on to more modern systems of communication. Overall, it is not a particularly edifying spectacle.
Mr. Dalton
There are people with interests in the Garda Síochána, as there are in every organisation, who wish to portray negative aspects. We have had negative impressions of the PULSE system. The reality is, however, that it is a relatively good system by international standards, with low down-time rates. By and large, it is successful. Sometimes computers have the effect of keeping close tabs on matters which some may not like and the obvious course of action is to rubbish the PULSE system. Some of the public comments do not necessarily represent the full facts. I have often had occasion to check the facts in regard to stories about the system and various other matters in the newspapers. In such cases when one asks for a formal comment, the account one gets is quite different from that one might read in, say, the Evening Herald.
Does Mr. Dalton think accelerated implementation of the civilianisation programme would give the taxpayer better value for money in some of the areas in which security and other operational issues do not arise?
Mr. Dalton
The civilianisation programme is proceeding. There was a time when it was seen as a less expensive option. However, in recent times it has become fairly expensive. To the greatest extent possible, those trained to be policemen and women should be out on the streets acting as such. There are 500 posts to be civilianised arising from the strategic management initiative and the intention is to proceed with filling them. I do not have the proportion but there has been a significant increase in recent years, although the figure is still relatively low compared to that in other jurisdictions. In the case of the London Metropolitan Police, the ratio is of the order of 1:1. However, unlike British police forces, including Northern Ireland, one must also take account of the fact that the Garda Síochána offers a full security service. We do not have an MI5 or MI6, a factor which must be taken into account to view the whole picture. Civilianisation has been recommended through the SMI and it is the Government's intention to proceed with it.
Is the AV system now operational in each Garda station?
Mr. Dalton
It is operational to a significant degree. Many interviews have been conducted and the system is catching on. Some 20,000 have been interviewed and the tapes used in 44 court cases, including one murder case.
Is a young fellow who is picked up and brought to a Garda station for a public order offence on an ordinary Saturday night entitled to ask to be interviewed on video?
Mr. Dalton
Yes.
That does not happen in the areas with which I am familiar.
Mr. Dalton
The equipment is available in particular interview rooms. Therefore, something can happen which will not be recorded in other rooms. If there are youngsters who believe they have been denied access to video recording, I will be glad to have the matter investigated.
What approach is taken to the assessment of references for each tender? Were references sought?
Mr. Dalton
In the case of SKS, there appears to have been heavy reliance on the internal assessment of the Garda Síochána, an issue on which the Comptroller and Auditor General commented adversely. As far as I know, AV Niche did not authorise or suggest persons from whom information or references could be sought.
Why did the Garda Síochána take the supply of equipment to the Grampian police force in Scotland into account in determining SKS's background when it did not supply the equipment?
Mr. Dalton
I do not know the answer to that question.
It is disappointing that we do not have members of the evaluation team present. The Secretary General has had to field all of these questions in difficult circumstances, which he has done exceptionally well. Does he agree that it is difficult to deal with the matter when one is not dealing directly with the evaluators of this critical contract?
Mr. Dalton
It is for that reason that I will welcome the forthcoming legislation under which the Garda Commissioner will become accounting officer for the Garda Síochána. At present the Secretary General of the Department of Justice, Equality and Law Reform is accounting officer for the force as well as the prisons and other bodies. With 12,000 staff, the Garda Commissioner will need to have good information systems in place to find out what is happening in the engine room.
The steering committee was first appointed in March 1993. Its second interim report was published in March 1999. Why did it take so long to complete its work? When was its first interim report published?
Mr. Dalton
I do not have that information. I will get it and come back to the committee.
Why was €109,000 spent on installing test equipment in June 2000, approximately 15 months after the steering committee had recommended in its second interim report that a national scheme of electronic recording of interviews of suspects be implemented?
Mr. Dalton
That is the purchase which has caused most controversy. It is described as an extension of the pilot scheme. It is the one issue, from the point of view of AV Niche, I find most difficult to understand.
I also note from the file that in July 1999 the Garda Síochána forwarded a letter it had received from AV Niche containing an offer to SKS to evaluate various audio-visual recording systems. Did it seriously expect AV Niche to be open with a business rival?
Mr. Dalton
I do not know. Going back to Deputy Curran's point, obviously having worked together for years a certain relationship had developed. While it was not contractual, it nevertheless appears to have been close. Obviously, the Garda Síochána took it that SKS was the expert. It was a serious mistake that should not have been made. What is good is that, as I understand it, AV Niche did not supply the equipment. Thus, poor, unacceptable procedure did not in the end have a bearing on the contract.
Was the Garda Síochána aware that SKS had asked AV Niche to provide it with equipment for testing?
Mr. Dalton
I do not know. SKS did ask but I do not know whether the Garda knew.
Did the Garda Síochána ask SKS for further details concerning its correspondence with AV Niche?
Mr. Dalton
The only matter of which I am aware in regard to the Garda Síochána and the exchange of correspondence between AV Niche and SKS is, as I said to Deputy Rabbitte, that correspondence emerged suggesting some sort of putative business arrangement between AV Niche and SKS. I do not know what other information the Garda Síochána sought from SKS on its relationship or correspondence with AV Niche.
Why did the steering committee specifically recommend that the new video recording system should be employed as part the national scheme when the Department of Justice, Equality and Law Reform and the GardaSíochána had not made any such stipulation in the request for tender?
Mr. Dalton
I do not know. The steering committee had its own independent expertise. It looked at the matter and made a decision. I do not know the reason it preferred Neal equipment to any other. It recommended the same make and model.
Why did the Department of Justice, Equality and Law Reform choose not to follow the steering committee's recommendation that only Neal equipment should be purchased?
Mr. Dalton
Neal equipment is supplied by SKS. We were not asked which equipment should be purchased. The steering committee recommended that the same equipment as that in use in 1993, which happened to be equipment manufactured by Neal, should be used. SKS subsequently became an agent for Neal. The committee continuously recommended that the same equipment should be used, which effectively meant that SKS and Neal would be the suppliers. When it came to the formal contract procedure, the events about which we have been talking took place.
Did the Department of Justice, Equality and Law Reform or the Garda Síochána make any complaints to the steering committee about its bias in favour of a particular make of equipment? Did the Garda Síochána not put down any marker?
Mr. Dalton
We had no involvement in the matter. I am not aware that the Garda queried the fact that the steering committee was recommending that one type of equipment be used. Had it done so there would probably have been questions as to whether it was interfering with its independence. Committees are set up to do a job and given expertise. If their recommendations happen to be unsound, that is bad but it is also bad if one interferes with them.
What Mr. Dalton is really saying is that the steering committee had total autonomy?
Mr. Dalton
It was set up to do a job and use its best judgment and skills. We were not second-guessing it.
The contract was awarded in March 2001. Mr. Dalton informed Deputy Curran that a whole series of contracts for CCTV - I think 12 in all - had been awarded to SKS over a period of time. In the other documentation supplied today on the Votes, subhead E of the the Garda Síochána Vote shows savings of €4.771 million at the end of the financial year on 31 December. The explanation given is that the savings arose because projects such as the installation of audio-visual facilities in interview rooms and Garda CCTV systems did not proceed as quickly as anticipated. Was this work to be done by SKS? May I take it that, having awarded the contract we are discussing and other CCTV contracts, there was a delay in implementation?
Mr. Dalton
In the case of CCTV I mentioned 12 contracts in respect of many of which the equipment has not yet been supplied. Work is being held up by many matters such as the granting of planning permission and so on. As far as I know, there are CCTV systems in Dublin, Cork and Tralee. I am not certain what the position in Limerick is. The preferred supplier is SKS but, as I said, work is delayed for all sorts of reasons such as the granting of planning permission and so on.
What I am getting at is that in the Comptroller and Auditor General's report for the Department of Justice, Equality and Law Reform subhead E of the Garda Vote shows a surplus of €4.771 million. How much of this is attributable to the contract given to SKS on 21 March 2001?
Mr. Dalton
I will have to find out what else is contained in the documentation——
The point I am getting at is that there seemed to be a great hurry in the early months of 2001 to have the contract awarded. I am trying to establish whether matters were advanced as expeditiously to do the work afterwards.
Mr. Dalton
I have the required information here somewhere.
Mr. Dalton could think about the matter while we are looking at the Estimates.
Is it right that the contract was awarded in March 2001? I am puzzled by this because the letter I quoted earlier dated 26 April 2001 stated: "Whilst it is appreciated that the tender process is still current. . . ". Apparently, the tenderer in question thought it was still current one month after the contract had been awarded.
Mr. Dalton
I do not know if it was announced at that stage that a successful tender had been made.
There was not much point in bringing the information to your attention that there was a better version of the technology available and you passing it to the Garda Síochána if the decision had already been made.
Mr. Dalton
That is correct. I do know that DVD was looked at and commented on by the steering committee.
The letter made it clear that this should not have happened. The relevant sentence read, "CD recording technology should not be confused with DVD recording technology which is currently not standardised". I will ask Deputy Curran to explain all of this to me some night over a pint in Clondalkin. The author of the letter brought this CD video recording technology to your attention and set out 12 reasons it was better than what was being tendered for. The purpose was merely to ensure the danger of employing a less efficient technology was minimised.
Mr. Dalton
I will have to join the Deputy in Clondalkin to avail of some of this expertise because I do not know.
If you come to Clondalkin, you might bring with you one of the chaps who can answer some of the more obscure questions.
Mr. Dalton
We could be there for a long time. With regard to AV Niche and the letter from Mr. Holmes, when he wrote to me I knew nothing about the matter. I sought information and would have passed all of it into the system. When I received subsequent correspondence from Mr. Holmes, it was clear that the answer - which I quoted faithfully as I do not know anything about the technology - was that it was not up to scratch. He had genuine, detailed questions to ask which I was not able to answer. That is the reason I asked the Comptroller and Auditor General to look at the matter as it seemed to be the only way of getting behind all of the technical material. It is also the reason, as I have told the committee, that there is still much conflict. It may be the case that the Comptroller and Auditor General cannot assess some of the arguments made by AV Niche and that someone else will have to look at the matter again and report to the committee.
While I do not wish to discourage the committee, I am not sure it would be profitable to bring the people concerned before it as much technology would be thrown about the place but that is a matter for it to decide. It may well be the case that another look at the matter is required. From AV Niche's viewpoint, there are still many outstanding questions.
Mr. Purcell
The Government Contracts Committee approved a contract with SKS on 28 March 2001. The contract was placed on 1 April 2001. AV Niche was not notified that its tender was not successful until 26 April 2001.
Is that customary?
Mr. Purcell
No, that is one of the matters we found that was not in accordance with the rules. AV Niche should have been notified sooner and given fuller reasons it was not successful or that its tender was not the most economically advantageous. This is mentioned in the report as one of the breaches of the rules. The legal expert concluded that since this happened after the award had been made, it could not have affected it.
I have heard the accounting officer suggest on a few occasions that I might take another look at this matter. I undertook this examination with a degree of apprehension because I was conscious I had to do it within the powers available to me. Clearly, this imposed certain constraints on the way I was able to carry it out. I did not interview the successful and unsuccessful tenderers because how would I have validated what they said? They would have seen matters from a particular perspective. There are always at least two versions of the truth with nuances dating back some time. To do a full examination I would need special powers which could only be given to me by the Oireachtas. I am thinking, in particular, of the discovery of documents from private firms and taking evidence under oath. They would be akin to the special powers given to me during the DIRT inquiry. There is a limit to what I can do.
The committee has received legal advice on this matter on which I go along with the Chairman. I do not know how kosher it would be to quote legal advice given to committees but I go along with its thrust. The Comptroller and Auditor General or the committee is not necessarily the proper forum for establishing whether party A or party B should ultimately get a contract. It would be an impossible task unless the committee was vested with powers to compel witnesses to give evidence under oath. If we go down that road, we might have similar scenarios every few months. We, therefore, have to be careful.
There is an avenue for determining these matters. This was a competition carried out under EU procurement rules. There is mechanism in place involving the European Commission which enables resolution of such disputes without resorting to litigation. In my view that is how this case would have to dealt with. If not, as the accounting officer suggested, the courts have the power to take evidence under oath, otherwise it would be otherwise. I enter this caveat on anything suggested here. Without being given special powers, I cannot see how I can do more. I am not taking the accounting officer's suggestion on board.
Mr. Dalton
The accounting officer's suggestion was made in desperation. What we have is not enough for the committee to determine how satisfactory or unsatisfactory the outcome was. If the EU option is available - I apologise for not adverting to it - it is an alternative to the courts. It is entirely a matter for AV Niche and we should not influence its thinking on what course of action it should take.
With regard to an appeal to the European Union, must one have local legal standing?
Mr. Purcell
While I am not an expert, I believe a dissatisfied contractor who is of the view that the rules have not been followed, or I suspect the spirit in which they were made, can make a case to the European Commission and will have standing in doing so. That is how I understand it. However, this does fall in with what the parliamentary legal adviser is saying.
There should be time for reflection on today's debate. I propose that we do not note the report today. I thank the Comptroller and Auditor General for a very thorough report which has generated huge debate. There will be much reflection in coming weeks on what we discussed today. There are also legal matters outstanding. When the report due to be furnished is placed before the committee, there may be some further points we can discuss before proceeding to a vote.
The agenda for next week's meeting will include the CDVEC 1998, 1999, 2000, 2001 and section 7 report as well as the 2000 BIM accounts, supplementary report, with the 2001 accounts.
The witnesses withdrew.
The committee adjourned at 2.30 p.m. until 11 a.m. on Thursday, 3 July 2003.