The Deputy may be aware that a provisional agreement on the Public Procurement Package (Classical Directive, Utilities Directive and Concessions Directive) was reached under the Irish Presidency of the European Council. The inclusion of social considerations in public procurement procedures, specifically at the contract award stage, is an issue that is being addressed in the reform of the procurement directives. In this regard, the revised directive, when implemented, should provide greater scope and legal clarity in relation to the use of social criteria at contract award stage.
Notwithstanding the publication of the revised procurement directives, the use of a social clause requiring a building contractor to recruit a certain percentage of those employed on a public works construction site from the ranks of the long term unemployed is being piloted on a limited number of schools projects under the Devolved Schools Programme being procured by the National Development Finance Agency (NDFA) on behalf of the Department of Education and Skills. Tenders are currently being evaluated on the first bundle of schools being procured under this Programme. Once the first contract is awarded, the monitoring phase of the pilot programme can commence to ensure that the mechanisms included in the revisions to the contract are measuring and monitoring the targeted benefits during the execution of the contract.
Where clauses are included in a contract requiring the successful tenderer to employ a certain number of workers as part of the performance of a contract, this must be monitored both to establish the success of the initiative but also because such a measure comes at a cost to the contractor. Were it to be ignored post-award then unsuccessful tenderers could legitimately challenge the award of the contract on the basis that their tender included the actual cost of complying with the requirement of the contract which was not reflected in the performance of the contract.
Once this phase is completed the contract amendments necessary to meet these requirements will be included in the €1.5 billion, PPP element of the €2.25 billion Stimulus Programme that I announced in July 2012. However it is not intended to include the amendments incorporating these social clauses in the public works contracts generally since there is a substantial risk that doing so would cause considerable displacement of those already in employment. The Stimulus Programme represents an additional Government spending commitment on top of the €17 billion funding contained in the ‘Infrastructure and Capital Investment 2012 – 2016’ published in November 2011. Those projects funded under the Stimulus Programme that are not PPP projects may apply the amended forms of contract, provided they are of an appropriate scale, but must first seek the sanction of the Government Contracts Committee for Construction to depart from the standard form of public works contract.
