Dáil Éireann Debate, Thursday - 2 July 2015
23. Deputy Terence Flanagan asked the Minister for Public Expenditure and Reform the changes that have been made to the rules for the tendering process for public contracts in order that small sole traders and small and medium enterprises are able to compete and offer tenders; and if he will make a statement on the matter. [26131/15]
View answerThe reform of the public procurement infrastructure is a key element of the reform programme for the public service. Such reform enables public service organisations deliver much needed services within the tighter budgets that they must now operate. However, I would point out that reforms in this area are being carried out in a manner that recognises the importance of SMEs.
The Government 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. Circular 10/14 issued in 2014 by my Department is aimed at opening up opportunities for small businesses that want to tender for public contracts and also to ensure that engaging with government procurement is easy and low cost. This guidance set out positive measures that contracting authorities are to take to promote the involvement of smaller enterprises as well as highlighting practices that are to be avoided because they can hinder small businesses in competing for public contracts.
The main thrust of the circular is as follows:
- buyers are advised to undertake market analysis prior to tendering in order to better understand the range of goods and services on offer, the competitive landscape, including the specific capabilities of SMEs, etc;
- the circular promotes transparency in procurement by requiring supplies and general services contracts with an estimated value of €25,000 be advertised on the Government's electronic tendering portal, e-Tenders;
- it encourages suppliers including SMEs to fully use e-Tenders and avail of its facilities in relation to registration, e-tendering and automatic alerts in relation to future tendering opportunities;
- buyers are encouraged not to set turnover thresholds at more than twice the estimated contract value and puts limits on insurance levels for suppliers where possible;
- promotes greater use of "open" tendering and less use of "restrictive" tendering;
- it encourages SMEs to consider using consortia where they are not of sufficient scale to tender in their own right or where they may lack certain capabilities necessary to provide a compelling proposition; and,
- it encourages Contracting Authorities to break large contracts down into lots where reasonable to do so and where it does not expose the State to undue risk or significant management overheads.
Recent analysis carried out by the OGP indicates that 93% of government procurement expenditure is within the State and that 66% of this is directly with Irish SMEs. The OGP will continue to work with suppliers and business representatives 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.
