Thursday, 1 February 2018

Ceisteanna (16)

Mick Barry


16. Deputy Mick Barry asked the Minister for Education and Skills if he will review the practice of tendering school build projects in view of the collapse of a company (details supplied) resulting in the discontinuation of work on six school build sites here; and if he will make a statement on the matter. [4658/18]

Amharc ar fhreagra

Freagraí scríofa (Ceist ar Education)

The liquidation of the company referred to by the Deputy does not directly affect any school building projects other than the Schools Bundle 5 Public Private Partnership (PPP) programme. 

In the case of PPPs, the Department's contract is with a Special Purpose Vehicle (SPV) rather than with a construction contractor.  The SPV then enters into a separate contract with a construction company to procure the construction element of the contract. In this way, it differs from traditional school building projects. 

In particular, where a liquidation event arises with the construction contractor in a PPP project, it is the responsibility of the PPP operator to ensure that construction is completed. The PPP operator is incentivised to resolve the issue as quickly as possible, as the State does not commence payments under the contract until construction is complete. 

With regard to the procurement and award process for all school building contracts, my Department adheres to the rules and guidelines set down by the Department of Public Expenditure and Reform and the EU Commission in relation to public procurement. 

The Department of Public Expenditure and Reform has responsibility for implementing national policy on public procurement, particularly in relation to construction procurement.

The Capital Works Management Framework developed by the Department of Public Expenditure and Reform allows for various bond and guarantee options designed to protect the Contracting Authority/Employer from issues such as contractor insolvencies. These options include retention deductions, performance bonds and parent company guarantees. The majority of major projects in the education sector operate using a combination of a performance bond and retention deductions.