Departmental Contracts

Dáil Éireann Debate, Tuesday - 12 October 2021

Tuesday, 12 October 2021

Questions (241)

Catherine Connolly

Question:

241. Deputy Catherine Connolly asked the Minister for Defence the number and value all procurement contracts that took place by way of negotiated procedure without prior publication in 2020 and to date in 2021; and the date, value and purpose of each negotiated procedure contract in tabular form. [49725/21]

Written answers

Minister for Defence

The detailed information sought by the Deputy is not readily available within the time frame sought. At the request of my Department the military authorities are conducting the search, retrieval and collation of same. I will arrange to have this information forwarded to the Deputy as soon as it is available.

The following deferred reply was received under Standing Order 51

I refer to the above-referenced Parliamentary Questions for which it was not possible to provide a reply within the available timeframe. Information on the number and value of procurement contracts for 2021 is not yet available. The position on 2020 is outlined below.

The 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 2020, the Department complied with the guidelines with the exception of twenty-three contracts (in excess of €25,000) totalling €818,471 (excluding VAT) relating to:

- two contracts with a value of €56,650 were increased beyond the original estimated value

- four contracts with a value of €156,446 were awaiting completion of central purchasing arrangements

- eight contracts with a value of €240,736 were increased beyond the original term

- nine contracts with a value of €364,639 were delayed pending the outcome of an internal policy review

Each of these twenty-three 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 the above exceptional contracts, as part of the 163 contracts with a total value €51,137,722 (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 140 remaining contracts, with a value of €50,319,251 (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 163 contracts declared in the 2020 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	67	€ 31,094,593.57
Only suitable service provider	19	€ 3,530,740.87
Proprietary Goods/Intellectual Property issues	2	€ 973,760.00
Sample Suit acquisition for assessment of specifications/market research	1	€ 38,990.39
Security of Supply	5	€ 3,232,821.41
Standardisation and Interoperability	14	€ 3,608,326.90
Urgent Operational Requirement	5	€ 918,691.32
Extended Beyond Original Contract Terms	8	€ 240,736.26
Covid 19 Purchase	18	€ 5,311,690.18
Falling under Annex XIV of 2014/24/EU and Light Touch Regime	10	€ 1,369,002.26
Competition delayed pending outcome of Internal Policy Review	9	€ 364,638.97
Awaiting completion of central purchasing arrangements	4	€ 156,446.07
Availing of national price agreements with IPHA.	1	€ 297,626.59
Total	163	€ 51,137,722.79