Dáil Éireann Debate, Tuesday - 27 November 2018
184. Deputy Charlie McConalogue asked the Minister for Public Expenditure and Reform if he has considered the impact locally of pursuing the route of PPPs to develop State-funded projects (details supplied); and if he will make a statement on the matter. [48931/18]
View answerPublic procurement is a key priority for Government and has undergone significant reform aimed at ensuring sustainable delivery of much needed public services while also encouraging and supporting SME participation in these business opportunities. This approach is beneficial for the State because it nurtures competition which ensures value for money is maintained and provides SMEs with a platform to take advantage of similar opportunities in Ireland and across the European Union. The Programme for a Partnership Government recognises the importance of the SME Sector to the economy and is cognisant that public procurement represents a major opportunity for SMEs.
Specifically, the Office of Government Procurement have developed a suite of measures aimed at assisting SMEs to access public procurement opportunities (circular 10/14). These include:
- Proportionate financial capacity criterion (turnover requirements limited to twice the contract value);
- Contracting Authorities are encouraged to divide public contracts into lots;
- Provision for “consortia bidding” to assist SMEs to participate in procurement procedures where they would not have the relevant capability or scale; and
- Public bodies are required to advertise contracts for goods and services valued above €25,000 on the national eTenders portal.
In addition, my colleague, Minister of State Patrick O’Donovan, who has responsibility for public procurement, chairs quarterly meetings of an SME Advisory Group, in accordance with the Programme for Government. This ensures that the voice of Irish SMEs (including ISME, IBEC, SFA, Chambers Ireland, and CIF) is heard by Government.
One of the public procurement options available to Government is PPP, which offers an alternative model for delivering infrastructure that can be effective in particular circumstances. The Report of the PPP Review, published earlier this year, noted the role that PPPs have played in delivering much needed infrastructure in recent years, particularly during times when Exchequer funding was constrained. However, the Review did also acknowledge the challenges that PPPs can pose in terms of scale and complexity of the PPP contract.
While recommending that PPPs continue to be considered as a procurement option for suitable projects, the report also recommended that in order to address the scale/complexity issue, the scope for creating a new PPP-type procurement option that would be suitable for procuring smaller scale and less complex projects, over a shorter timeframe, be explored as an alternative to the typical PPP procurement option, for such smaller scale projects. I am pleased to say that work is progressing well on exploring this option and the European PPP Expertise Centre is assisting my Department in the matter. If successful, this would certainly assist in addressing some of the concerns of the Deputy in relation to typical PPP procurements.
I should, of course, also point out that while a number of projects have been, and continue to be, procured by PPP, the vast majority of public works contracts are procured as traditional Exchequer funded projects.
However, even in relation to the large scale PPP projects, opportunities exist for the SME sector to play a part in these projects. The NDFA, as part of the PPP procurement process, incorporates a programme-wide initiative with Enterprise Ireland whereby they host a series of “Meet the Buyer” events around the country offering small and medium-sized enterprises within the construction sector the opportunity to meet directly with the senior contractors within NDFA managed programmes.
