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Public Procurement Contracts

Dáil Éireann Debate, Wednesday - 7 May 2014

Wednesday, 7 May 2014

Questions (105, 106, 107)

John Lyons

Question:

105. Deputy John Lyons asked the Minister for Public Expenditure and Reform if the office of Government procurement will place a greater emphasis on long-term benefits to the economy when awarding procurement contracts; and if this can include the benefit of job creation to local communities and the benefits to smaller companies from splitting contracts between several companies. [20439/14]

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John Lyons

Question:

106. Deputy John Lyons asked the Minister for Public Expenditure and Reform if the office of Government procurement will give further consideration and assistance to groups of smaller Irish companies bidding for procurement contracts as a group due to the benefits to the economy and local job creation arising from such contracts. [20440/14]

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Terence Flanagan

Question:

107. Deputy Terence Flanagan asked the Minister for Public Expenditure and Reform the measures he has taken on procurement to ensure that smaller companies have a fair chance to bid; and if he will make a statement on the matter. [20456/14]

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Written answers

I propose to take Questions Nos. 105 to 107, inclusive, together.

Public Procurement is governed by EU and National rules. 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 the EU rules for a public body to favour or discriminate against particular candidates on grounds such as nationality, organisational size, etc. and there are legal remedies which may be used against any public body infringing these rules.

The Government is committed to maximising procurement opportunities which actively assist job growth and benefit the wider economy.  The public sector has an immense purchasing power, spending in the region of €8.5 billion per annum on goods and services. This is in addition to expenditure on public works.  This level of expenditure by the public sector affords significant business opportunities for firms that can supply the products and services that are required by public bodies.

The Government also acknowledges the significant role that SMEs play in the Irish economy and is committed to ensuring that SMEs are fully engaged with public sector procurement and the opportunities presenting. In order to encourage greater SME participation the Office of Government Procurement has conducted a targeted programme of education for suppliers who wish to learn more about doing business with the Irish Public Service.  This programme consists of seminars, workshops and large scale 'Meet the Buyer' events hosted nationwide.  These 'Meet the Buyer' events are run in conjunction with Enterprise Ireland and InterTrade-Ireland. To date the OGP has facilitated workshops and presented at seminars to over 4,500 SMEs nationwide.  These events afforded suppliers an opportunity to meet and discuss the issues with public service buyers and provide networking opportunities for suppliers and encourage consortia-building.

My Department has also recently finished reviewing and updating existing guidelines and procedures aimed at promoting SME participation in public procurement.  Circular 10/14, launched on 17 April, sets out new initiatives aimed at opening up opportunities for small businesses to bid for State business.  These new guidelines are aimed at reducing the administrative burden on businesses that want to tender for public contracts. The guidelines promote the setting of relevant and proportionate financial capacity, turnover and insurance levels for tendering firms and the sub-dividing larger contracts into lots, where appropriate, to enable SMEs to bid for these opportunities. The guidelines also encourage SMEs to form consortia where they are not of sufficient scale to tender in their own right and to register on www.etenders.gov.ie to ensure maximum exposure to tendering opportunities.

  The guidelines accelerate some of the key business-friendly initiatives included under the new EU Public Procurement Directive, currently being transposed by my Department.  The SME Working Group, established under the Government's Action Plan for Jobs, was consulted on the new Guidelines.  The SME Working Group is chaired by the Office of Government Procurement and includes representatives from ISME, IBEC, Inter Trade Ireland, Enterprise Ireland, the Competition Authority, the Small Firms Association, Chambers Ireland and the Department of Jobs, Enterprise and Ireland. The new Circular has been broadly welcomed by industry representative associations.

The reform of public procurement across the public service is on-going and will continue to provide opportunities to the SME sector to win business.  The Office of Government Procurement will continue to work with industry to ensure that winning government business is done in a fair, transparent and accessible way and to ensure that government procurement policies are business friendly.

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