Under EU rules on public procurement public works, supplies and service contracts above certain thresholds must be advertised on the Official Journal of the EU and awarded on the basis of objective and non-restrictive criteria. The aim of these rules is to promote an open, competitive and non-discriminatory public procurement regime which delivers best value for money. It would be a breach of these rules for a public body to favour or discriminate against particular candidates on the basis of grounds that could be considered discriminatory and there are legal remedies which may be used against any public body infringing these rules. In this regard, it is worth pointing out that the open market regime also offers opportunities for Irish companies to win business abroad and reliable EU studies indicate that many Irish businesses are successful in this regard.
The consideration of clauses that allow for the inclusion of social and environmental clauses in public contracts is something that I have been examining. Social clauses can be used in public procurement in cases where they are targeted at factoring into the procurement process consideration of social issues such as employment opportunities, equal opportunities and social inclusion. In order to be compatible with EU law, they must be made known to all interested parties and must not restrict participation by contractors from other Member States.
The European Commission issued guidance on this issue in 2010. This guidance stressed that when incorporating social considerations into the procurement process one of the key challenges is ensuring compliance with the EU Treaty Principles and the Procurement Directives. The EU procurement Directive primarily envisages that social considerations may be included as contract performance conditions, provided they are not discriminatory and are included in the contract notice or in the contract documents and relate to the performance of the contract. For example, the EU Directive states that contract performance conditions may be intended to favour on-site vocational training, the employment of people experiencing particular difficulty in achieving integration, or the protection of the environment.
Challenges arise from the need to ensure that: value for money is not adversely affected; additional costs are not placed on domestic suppliers relative to other potential suppliers; and the targeted benefit is capable of being measured and monitored during execution of the contract.
The Deputy may be aware that a revised set of EU Directives governing public procurement have recently been agreed. The revised directive, when implemented, should provide greater scope and legal clarity in relation to the use of social criteria in the context of an open, competitive and non-discriminatory public procurement regime which delivers best value for money.