asked the Minister for Finance the criteria used in allocating public works contracts in the Border region particularly in regard to Northern Ireland firms; and whether he takes into account the low cost factors and advantages which Northern firms have and which make for unfair competition with Southern firms.
Ceisteanna—Questions . Oral Answers . - Border Region Contracts .
28.
: No special procedures apply in Border areas for the award of public works contracts, nor in regard to firms from Northern Ireland.
EEC directives on public works contracts require that such contracts over a certain value be advertised in the Official Journal of the European Communities. These directives, and indeed the Treaty of Rome, require that contracts be awarded on a non-discriminatory basis in regard to nationality of other member states. It is normally a stipulation that the lowest or any tender may not necessarily be accepted but contracts are normally awarded to the lowest suitable tender.
: Is the Minister aware of the low cost factors which favour North of Ireland contractors and militate against contractors from the South? The building trade in the Border areas is on its knees and there is grave concern because many contracts have been awarded to North of Ireland firms who are masquerading as Southern firms using accommodation addresses in the South.
: The Deputy should ask a question.
: I am stressing the unfairness——
: I appreciate what the Deputy is anxious to do but he may not make statements at Question Time.
: I would be obliged if the Chair allowed me to make my point. The concept of the EEC was to equalise society——
: If the Deputy put a question it would be more acceptable to the Chair.
: I suggest to the Minister that the competition is totally unfair and that the low cost factors make for unfair competition. It is for that reason that a blind eye should be turned as far as possible.
: If I permit the Deputy to make a speech I will end up with 40 or 50 speeches in the hour.
: A number of the items which the Deputy has in mind as being susceptible as leading to unfair competition are ones which apply over a wider range of activity than just to the construction industry. Indeed they cover a wider field than we are concerned with in this question. Whether the differences could be represented as leading to unfair competition in the context of definitions of that concept under EEC regulations is a matter which is open to some question. I should like to point out that the conditions of contract for public works contracts include a fair wage clause which requires payment of wages and observation of conditions of employment not less favourable than those laid down by the National Joint Industrial Council for the Construction Industry. Northern Ireland contractors, of course, would be bound by those conditions.
: Will the Minister agree that the EEC non-discriminatory clauses were formulated in a context where there was talk of a common currency, equalisation of taxes, excise duties, social services and so on? Has that aspect not fallen heavily behind and, consequently, the non-discriminatory clauses should not apply in these cases?
: I do not think it is accurate for the Deputy to say that EEC rules of non-discrimination were formulated in the context he describes. They were formulated in the context of the Treaty of Rome which, as the Deputy is aware, contains no specific guarantee of equality of wage rates, tax levels or any of the other factors that would enter into a comparison of the base from which contractors in different countries would start. They apply in the context of the general rules of the Community on freedom of trade and freedom to provide services.
: Is it not true, for example, that the Werner Report mentioned all the items I have referred to? Is it not true that the fact that there is such a divergence is discriminatory? In fact, by insisting on the non-discriminatory they are producing discrimination, as Deputy McGahon outlined in his question.
: We would all agree that the difficulty raised in the question arises from the fact that there are substantial differences in tax levels over a wide number of areas between this country and our immediate neighbour in the North——
: And grants for trucks, machinery and fuels.
: And in trading conditions generally. I appreciate the points the Deputy is making and there is no doubt that they give rise to certain difficulties. Whether we can articulate our tax levels and other matters simply to take account of those difficulties is very much an open question. We have other considerations in mind when we fix our tax levels. While I agree that these differences give rise to problems the solution of them would require action on our general tax levels that would go far beyond the reasons that lie behind the question.
Mr. Leonard
: Will the Minister tell the House if he has any way of ensuring that those clauses are observed? Has the Minister any way of ascertaining if contractors adhere to them? Has the Minister done anything to ensure that those who claim benefit in the North do not work on such jobs in the Twenty-six Counties?
: The matters raised by Deputy Leonard are somewhat outside the scope of this question. I would observe that the rules which I have recalled governing these matters have been in operation for much longer than the present Government have been in office. There is, of course, a system of checking observation by the firms in question of the various clauses to which they must subscribe. The extent to which an individual contractor is invigilated will vary from place to place and on the type of authority giving the contract. Some of the contracts would come within the ambit of local authorities and others would be on a wider scale. To the extent that it is possible, the services concerned try to implement the regulations and ensure they are put into practice.