The Department of Public Expenditure and Reform allocates capital funding between departments/sectors, on a multi-annual basis, based on the Government's capital plan. Responsibility for selecting the individual projects to be funded within the various departmental/sectoral allocations is then a matter for the relevant individual Minister to decide, based on their priorities for the sector (and subject to agreement by Government, where necessary).
Capital expenditure is sanctioned through the line departments or bodies given a delegated sanctioning role by those departments. These 'sanctioning authorities' are responsible for monitoring the projects and dealing with cost overruns that arise within their capital sanctions. The Public Spending Code published by my Department sets out the principles which apply in relation to project appraisal, value for money etc., and which continue to apply throughout the implementation phase.
A project must complete the review stages set out in the Public Spending Code before sanction is given to go out to tender. At each review stage the project is evaluated to ensure it continues to meet its objectives, the budget is reviewed and adjustments undertaken as necessary. Once tenders are received the sanctioning authority must review the tender report and give permission for a contract to be awarded with an established construction budget.
It is a matter for the contracting authority who has awarded the contract to manage its performance thereafter and report on budgetary matters to the capital sanctioning authority concerned. The extent of cost increases on individual capital projects is a matter for each sanctioning authority, the details are not held centrally and therefore cannot be provided by my Department.
All public works projects that are delivered under the Exchequer-funded element of the Government's capital plan must be procured in accordance with the provisions laid down in the Capital Works Management Framework (CWMF). The CWMF is mandated by circular and was developed to provide an integrated set of contractual provisions, guidance material, technical templates and procedures which cover all aspects of the delivery process of a public works project from inception to final project delivery and review. The structure of this strategic framework complements the Public Spending Code.
A central pillar to the successful outcome of a construction project is a clearly defined set of contract conditions. The standard public works contract which must be used without amendment (unless otherwise sanctioned) is a lump sum, fixed-price contract and includes, amongst other important elements, a set of tightly defined circumstances where the contract sum and the project's completion date may be adjusted. It is a general principle that public works projects are put out to tender on the basis of a comprehensively defined set of project requirements so that tenderers can provide a lump sum price for the completion of the project.
Notwithstanding that, the conditions of construction contracts must make provision for change after the contract is awarded whether that is due to unforeseen circumstances or brought about by a change in the contracting authority's requirements. Careful management pre-procurement is required to ensure that neither scenario arises since changes are disruptive and costly in the construction phase. Public procurement law also recognises both eventualities and Article 72 of the EU 2014 Procurement Directives sets limits for both types of changes. Where these limits are exceeded a new procurement process is required.
With regard to the engagement of former employees of the public service on construction projects it is incumbent on contracting authorities to ensure that a conflict of interest does not arise in the procurement of public contracts generally. Article 24 of 2014/24/EU makes specific provision in this regard.
A key element of the Public Service Reform agenda is to reduce costs and achieve better value for money through reform of public procurement. In 2012 the Office of Government Procurement (OGP) was established as an office under my Department to lead on the Public Procurement Reform Programme by:
- Integrating procurement policy, strategy and operations in one office;
- Strengthening spend analytics and data management; and
- Securing sustainable savings
Much of the information sought by the Deputy up to and including the award of the contract is provided by contracting authorities as part of their obligations under procurement rules. Under EU Directives on public procurement public works, supplies and service contracts above certain thresholds must be advertised on the Official Journal of the EU (OJEU) and awarded on the basis of objective and non-restrictive criteria. For works contracts the current threshold is €5.225 million.
In relation to contracts valued below the EU thresholds, the general requirement is that works contracts above €50,000, be advertised on the national eProcurement portal www.etenders.gov.ie. It should be noted that not all contract notices give rise to a contract award.
The EU Directives require contract award notices for contracts above EU thresholds to be published in the OJEU not later than 30 days of the award of the contract. Guidelines in Circular 10/14 issued by my Department also require public bodies from 1 August 2014 to publish all contract award notices over €25,000 on eTenders. The publication of contract award notices is facilitated by the OGP through eTenders. It is important to note that the OGP does not validate the contract award data entered by contracting authorities on eTenders and this information does not constitute a contract repository.
The information sought by the Deputy relating to the tender and award of contracts has been forwarded in an excel spreadsheet from the data input by contracting authorities on eTenders. It is structured in columns setting out Tender ID; Contract Type; Contracting Authority; Tender Name; Procurement Procedure Type; Contract Award Value (for contracts above EU threshold, and below EU threshold contracts from 1 August 2014); Date of Publication of Contract Notice.
The OGP migrated to a new eProcurement platform in 2012 and, even though contracts were required to be published on the eTenders platform since well before this date, it is not possible to distinguish notice types prior to that date. The information provided from the current eTenders platform is all works contract notices (for projects with a value in excess of €50,000) published on the eTenders system from November 2012 (when the current version of eTenders became operational) to December 2016.
For the purposes of the response the Deputy should note that all contracts for commercial semi-state bodies have not been included on the basis that they are typically funded from their own revenue streams. It is acknowledged that some of these contracts may have been funded by the taxpayer but the source of funding cannot be determined from the contract notice. It should also be noted that the list of contract notices include framework agreements which are not, in and of themselves, contracts. Once a framework is concluded, contracts may be awarded in accordance with the call off rules for the framework. The list also includes Prior Information Notices (PIN) which are early indicators to the market of an intention to publish a tender within 12 months of the publication of the PIN, they do not necessarily result in the publication of a contract notice which initiates a tender.
