Dáil Éireann Debate, Tuesday - 3 November 2020
687. Deputy Sean Sherlock asked the Minister for Defence the number of contracts approved in his Department in 2019 and to date in 2020 without competitive tender; the details of the contract; the company awarded the contract; and the full value of the contract in tabular form. [33267/20]
View answerThe Department of Defence ensures that there is an appropriate focus on good practice in purchasing and that procedures are in place to ensure compliance with all relevant guidelines. In 2019, the Department complied with the guidelines with the exception of five contracts (in excess of €25,000) totalling €161,297 (excluding VAT) relating to various services contracts, which were extended beyond their original contract terms. Each of these five contracts have been reviewed by the Department, and steps are being taken to bring each of these contracts into compliance with competitive procurement rules as quickly as possible.
The Department has provided details of these exceptional contracts as part of the 89 contracts with a total value €19,679,110. (excluding VAT) that are included on the annual return in respect of Circular 40/2002 to the Comptroller and Auditor General and the Department of Public Expenditure and Reform. The 84 remaining contracts, with a value of €19,517,813 (excluding VAT), are considered compliant, as the justification for awarding these contracts falls within the exceptions to a competitive process permitted in national and EU legislation.
The main exceptions applied by the Department and Defence Forces are set out in the Defence and Security Directive 2009/81/EC. The Defence and Security Directive recognises the specific characteristics of defence and security procurement, its complexity and sensitivities, in particular security of supply and security of information considerations. Those considerations are also contained in Article 346 of the Treaty of the European Union.
An example of a legitimate circumstance whereby the Department or Defence Forces may award a contract on a non-competitive basis occurs is when the original equipment manufacturer is deemed the only suitable supplier. This may be necessary where a change in supplier would result in equipment with different technical characteristics, which would in turn result in incompatibility or disproportionate technical difficulties in operation and maintenance.
A number of other specific defence and security exclusions are provided for in the EU Directives namely:
- international rules or arrangements between Member States and third countries
- disclosure of information
- intelligence activities
- cooperative programmes
- contract awards in third countries
- government to government sales.
The table below provides a breakdown of the 89 contracts declared in the 2019 Appropriation Accounts, providing the number of contracts awarded under the various category of exclusion.
|
Reason for not having a competitive process |
Number of Contracts |
Value of Contracts |
|
Original Equipment Manufacturer |
47 |
€8,168,839 |
|
Only suitable service provider |
18 |
€2,784,679 |
|
Proprietary Goods/Intellectual Property issues |
5 |
€686,107 |
|
Sample Suit acquisition for assessment of specifications/market research |
1 |
€34,949 |
|
Security of Supply |
6 |
€5,973,625 |
|
Standardisation and Interoperability |
6 |
€1,839,970 |
|
Urgent Operational Requirement |
1 |
€29,644 |
|
Extended Beyond Original Contract Terms |
5 |
€161,297 |
|
Total |
89 |
€19,679,110 |
