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Dáil Éireann debate -
Wednesday, 20 Mar 2002

Vol. 550 No. 4

Adjournment Debate. - Helicopter Tendering Process.

Early last year the Minister for Defence authorised an advertisement for tenders from his Department for the supply of helicopters to the Defence Forces. On 6 December 2001, the Minister announced in a press release that he had considered the report of the technical group that had been established in his Department to evaluate tenders received for medium lift helicopters for the Air Corps from four different companies whom he named.

He went on to state that the report demonstrated that all four aircraft on offer met the technical requirements and the Minister had decided all tenderers would be given one week in which to make a best and final price in regard to the helicopters. Subsequently, in a press release on 17 January 2002, the Minister announced that on that day he had authorised his Department to open negotiations with Sikorsky International Operations, Connecticut, USA, for the purchase of three medium range helicopters, S92s, for search and rescue purposes with an option of a further two helicopters for general purpose military transport. The press release recorded that the Minister's decision followed from a detailed examination of the tenders received from the four different companies, including Sikorsky, CHC Scotia of Scotland, EH Industries Limited, UK and Eurocopter of France. The Minister stated that he hoped the contract negotiations would be completed in a matter of weeks, that the White Paper on Defence which was approved by the Government in February 2000 recognised the urgent equipment modernisation requirements in the Air Corps, and that the purchase of medium lift helicopters was a positive indication of the Government's commitment to ensure all branches of the Defence Forces, Army, Air Corps and Naval Service are fully equipped to carry out their day to day roles.

On this side of the House, the urgent need to provide the Defence Forces with the helicopters they required was recognised and we are supportive of the Minister's endeavours. We regard it as a matter of great urgency that the helicopters be supplied and I draw the atten tion of the House to the fact that the three medium range aircraft which were to be ordered initially were for search and rescue purposes. The remaining helicopters related to an option to purchase two aircraft for general military transport purposes. There is a great need to provide helicopters to perform search and rescue operations off our coast and to provide a far better service than we have at present. We need those aircraft to provide the level of service to which we are entitled as are ships which get into difficulty off our coast.

The matter of the purchase of these helicopters again came before this House on 13 February because Eurocopter had taken proceedings against the Minister in the High Court complaining that information to which it was entitled under the Freedom of Information Act had not been supplied. It is now alleged that, instead of proceeding with the negotiations with Sikorsky, the Government intends to re-tender the contract for the supply of helicopters. It is reported that, having gone through the lengthy tendering process of 2001, the Minister proposes to terminate discussions currently taking place between his Department and Sikorsky as a consequence of alleged irregularities in the manner in which the Minister dealt with the original tendering process. This is of serious public concern. If there is to be a new tendering process it will put back by another 12 months' progress to provide helicopters which are badly required by the Defence Forces and it will mean hundreds of thousands of pounds of taxpayers' money has been wasted in the tendering process to date. It would be a considerable setback in meeting the needs and expectations of the Defence Forces. It is of the utmost importance that the Minister clarifies the current position to the House tonight.

I thank Deputy Shatter for raising this important matter and I am very happy to have the opportunity to outline the position from my point of view.

On 17 January 2002, I authorised my Department to open negotiations with Sikorsky International Operations Incorporated, Connecticut, USA, for the purchase of three medium range helicopters, S-92s, for search and rescue purposes. The negotiations were also to include an option, exercisable within three years by the Department, for a further two helicopters for general purpose military transport. The decision followed a detailed examination of the tenders received from the four companies – Sikorsky USA, CHC Scotia Scotland, EH Industries limited UK, and Eurocopter France.

The offer from Sikorsky was deemed to be the most strategically and economically advantageous tender, taking account of the award criteria set out for the tender competition. Those criteria included functional characteristics, technical merit, all maintenance and on-line technical support, after-sales service and warranty terms on offer, cost and ready availability of spare parts, tender prices and life-cycle costs over a nominal 20 year period. I am satisfied that, on the basis of the facts presented to me, the offer from Sikorsky would provide best value for money from the taxpayers' point of view. The timeframe proposed by Sikorsky would see the delivery of three search and rescue helicopters by the end of next year.

Following my decision of 17 January 2002 Eurocopter sought the reasons for the acceptance of the Sikorsky tender and the rejection of its tender pursuant to Article 7 of EU Public Procurement Directive 93/36/EC, as amended. A reply issued from the Chief State Solicitor's office to solicitors acting for Eurocopter in this matter on 6 February 2002. In addition, solicitors acting for Eurocopter submitted a request under the Freedom of Information Act, 1997, seeking documentation relating to the tender competition. Eurocopter subsequently issued judicial review proceedings alleging, inter alia, that I was in breach of my obligations under Directive 93/36/EC, as amended, to furnish the characteristics and relative advantages of the tender selected. The proceedings sought certain information and documents from me on the tender procedure and award. The judicial review proceedings were adjourned, with consent, last Friday 15 March 2002 until 15 April 2002, for mention. The request under the Freedom of Information Act, 1997, from Eurocopter has been progressed as far as possible by the Department at this stage and documentation relating to the competition has been passed on to solicitors acting for Eurocopter.

My Department is continuing to deal with the Chief State Solicitor's office on the judicial review proceedings and it is my intention to be as forthcoming as possible in this regard. However, as the matter is due to come before the courts again in mid-April, I do not wish to say anything further at this stage. I should say, however, that to date no proceedings have been issued challenging my decision to open contract negotiations with Sikorsky.

Are the Minister's discussions with Sikorsky completed?

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