Dáil Éireann Debate, Wednesday - 18 September 2013
433. Deputy Sean Fleming asked the Minister for Public Expenditure and Reform the current status of circular number 06/12 regarding public procurement in view of the High Court decision which was delivered by Justice Hogan on 29 May 2013; and if he will make a statement on the matter. [37586/13]
View answerAs the judgement referred to by the Deputy is under appeal it would be inappropriate for me to comment directly on it.
Reform of public procurement is one of the major projects of key strategic importance in the Government’s Public Service Reform Plan, which was published in November 2011. Procurement of supplies and services accounts for around €9 billion of current spending by the State per annum. This represents a very significant portion of overall spending and it is, therefore, essential that the Public Service achieves maximum value for money and operational efficiency in its approach to public procurement.
In this regard, the National Procurement Service (NPS), which will be transferring into the new Office of Government Procurement (OGP), has put in place a number of national arrangements designed to secure better value for money from leveraging the public service’s buying power in relation to a range of goods and services that are commonly purchased across the public service.
In some instances the take up of the NPS arrangements has been low. In order to increase the usage of the NPS arrangements and thereby secure best value for money, the Government decided that it should be mandatory for public service bodies to use specified national procurement arrangements. Last year my Department issued Circular 06/12 which implements the Government decision by making it a mandatory requirement that public service bodies avail of specified national arrangements put in place by the NPS.
While the key purpose of Circular 6/12 is to enable the State to do more with less by aggregating procurement to secure better value for money, it is worth noting that such aggregation arrangements can be implemented in a manner that achieves value for money with a minimal negative impact, or indeed a positive impact, on SMEs. While a number of the categories of goods and services mandated under the Circular are suited to single supplier national arrangements, these need not be accepted as the norm. The greater use, where appropriate, of multi-supplier frameworks can address local supplier issues while also ensuring on-going cost competitiveness of the framework itself. Such multi-supplier frameworks may also offer SMEs the opportunity to participate in national level contracts, thereby offering valuable reference work when competing for public procurement contracts in other jurisdictions.
As Circular 6/12 has served its initial purpose, in that it has highlighted the exceptional value for money available to public bodies that use the limited number of framework arrangements referred to in Circular 6/12. I will shortly issue a new Circular that will replace 6/12.
As public bodies are now better informed of the wide range of goods and services available for purchase under national arrangements, the new Circular will inform public bodies of the continued need to secure best value for money through the use of national contracts, put in place by the Office of Government Procurement (formerly the National Procurement Service), when procuring a range of commonly acquired goods and services. The benefits arising from these central arrangements include: cash savings; administrative savings from reduced duplication of tendering; greater purchasing expertise; improved consistency; and enhanced service levels.
