Oireachtas Joint and Select Committees

Wednesday, 21 January 2015

Joint Oireachtas Committee on Finance, Public Expenditure and Reform

Operations and Functions: Office of Government Procurement

2:30 pm

Mr. Paul Quinn:

As part of our meetings with the community and voluntary sector, including The Wheel, we encouraged organisations to make a submission on the transposition process so that they could have their say on the new framework.

In regard to our involvement in infrastructure and capital projects, the office has no operational remit with regard to the procurement of large capital works. The Deputy referred to Grangegorman, the docklands and the children's hospital as examples of such projects. We are not running procurement at an operational level for those individual projects. In terms of policy, we have a clear remit in that regard. Through our government construction contracts committee, we pull together the key stakeholders involved in executing capital works on an ongoing basis to examine the issues arising. This could include the review of public works contracts or various other emerging requirements identified by the committee on behalf of constituent stakeholders, including the Department of Education and Skills, the Office of Public Works and the Department of Health. From a policy perspective, we push out policy through that committee and consult it on the development of policy. However, the office does not get involved with the day-to-day procurement activities of the individual projects. I am a board member of the children's hospital and, as such, am intimately involved in procurement for that project but that is restricted to my personal role on the board. As part of larger infrastructure projects, the policy team in particular works closely with the relevant organisations. Thus, for example, our key construction advisor, Mr. David O'Brien, has a close working relationship with the CEO of Grangegorman Development Agency, Mr. Michael Hand. We work hand-in-glove on bigger projects in the State because our advice is often sought in regard to various policy matters. Implementation is left to the bodies concerned, however.

On the question of social clauses, 11 projects are a reasonable start given our previous position. I do not agree that it is a timid number because one of the key aspects of what we are trying to do is move outside of the construction space. Internationally many social clauses focus on construction and employment. We are trying to look beyond that to consider other services in respect of which ongoing social clauses can be implemented at an operational level. We want to test this mechanism because we may need to consider specific aspects of individual goods or services, including in particular services for which social clauses might be difficult to implement in some cases but easy in others. One of the reasons for setting up the group was to learn how we can do this well. We can then publish guidelines and take the findings on board in developing legislation. There are positive indications for what can be achieved from social clauses but there are also concerns about issues such as SME costs and the potential imbalance between the obligations of national and international parties. If, for example, a tender obliges a construction firm to increase employment and the contract is won by a firm from outside the country, the workers could potentially be hired from outside of the State and the training could be provided outside of the State. We do not want to create an uneven burden for national firms. Concerns also arise in regard to displacement of jobs. While we could force employers to hire, that could also require them to shed jobs. We want to act carefully in regard to the advice we give to the Minister on how this policy will be formed. We intend to learn a lot from expanding those arrangements.

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