Public Procurement is governed by WTO, EU and National rules and guidelines. The aim of these rules is to promote an open, competitive and non-discriminatory public procurement regime which delivers best value for money.
WTO rules and EU Directives on public procurement require that 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. For works contracts, the threshold is €5,548,000; for supplies and service contracts awarded by Government Departments, the threshold is €144,000 and for the remainder of public bodies, the threshold is €221,000. The threshold for supplies and service contracts of entities operating in utility sectors (water, energy, transport and postal) is €443,000. For contracts below these thresholds, the general requirement is that they be advertised on the national public procurement website www.etenders.gov.ie or, depending on value, awarded on the basis of a competitive process of direct invitation to an adequate number of suitable suppliers.
In addition, the Deputy will be aware that the Office of Government Procurement developed Circular 10/14 which is aimed at facilitating small and medium-sized enterprises in competing for public procurement opportunities. In this regard, the following national rules apply to below EU threshold procurements:
- All public contracts for supplies and services with an estimated value of €25,000 (exclusive of VAT) and upwards should be advertised on the national public procurement website, www.etenders.gov.ie.
- The advertising threshold for works is set at €50,000 (exclusive of VAT).
- Suppliers of goods and services and especially the SME sector are encouraged to register on the e-Tenders website and avail of its facilities including receiving automatic alerts in relation to future tendering opportunities.
It is worth noting that these thresholds were reviewed last year in consultation with the SME Advisory Group, chaired by my colleague, Minister of State O'Donovan, which is comprised of representatives from IBEC, SFA, CIF, ISME and Chambers Ireland and it was recommended that the national thresholds remain at the current levels. The main reasons for setting the national thresholds at these levels is to open up public procurement opportunities to small and medium sized enterprises (SMEs) and to achieve value for taxpayer’s money through competitive and transparent tendering processes. It is a basic principle of public procurement that a competitive process should be used.
These thresholds for advertising on etenders will be kept under review in light of the impact on operational efficiency, value for money and accessibility to business opportunities, particularly the SME sector.