Ms Clare McGrath:

I am pleased to come before the joint committee to outline the role of the Office of Public Works, OPW, in the area of procurement of construction services. I propose to open with a summary of the core responsibilities of the office. The OPW has responsibility for some 2,200 buildings. This is a wide-ranging portfolio comprising Garda stations, office accommodation, heritage properties, museums, laboratories, storage facilities, etc. The office provides a shared service to Departments and agencies in the areas of property management and maintenance.

The National Procurement Service, NPS, which was established in 2009, is currently a function of the Office of Public Works. It provides professional procurement services to ensure the public service can efficiently and effectively access the best value goods and services in a legally compliant manner. One of the goals of the NPS is to encourage participation by small and medium-sized enterprises in public procurement. To this end, the eTenders.gov.iewebsite is a source for publishing and accessing tender notices on Government and public sector procurement throughout Ireland. As we continue to strive towards a more efficient delivery of public services, the NPS will continue its education programme and hold seminars on public procurement. This will assist buyers and suppliers to interact effectively with emerging markets and keep them informed of current procedures.

The Office of Public Works is the lead agency in co-ordinating the management of flood risk and we deliver our responsibilities directly through our own resources and contractors and in conjunction with other agencies such as local authorities. In respect of heritage services, the OPW manages in excess of 700 sites, catering for up to 3 million visitors at guided sites annually, and protects site fabric by a continuing programme of planned maintenance adopting best architectural and conservation principles. Furthermore, the office provides specialist procurement and technical input to the Government and various Departments on particular projects where the office is not funding the works, for example, assisting the Department of Education and Skills in the expansion or addition of 15 schools. These items do not appear as expenditure on the Office of Public Works Vote.

To address the topic under discussion today, the Department of Public Expenditure and Reform is responsible for determining national policy on public procurement. We, in the Office of Public Works, are practitioners and in our day-to-day operations we give effect to these national guidelines and, where applicable, European Union directives in this area. The OPW complies with the Government decision of 2009 in its commitment to pay contractors and suppliers within 15 calendar days, thereby improving on the statutory requirement of 30 days under prompt payments legislation.

For all construction and construction related services, the Office of Public Works is obliged to use the capital works management framework forms of contract. In accordance with the Department of Finance Circular 10/10, tenders for project works valued at between €50,000 and €250,000 are advertised on the eTenders website using the short or minor form of contract. This is the standard procedure for project work. Another form of building works contract used is investigation and building works designed by the employer. For the provision of services that may be required occasionally, namely, professional services, the relevant forms of contract for consultancy and archaeology are used.

Maintenance works, using the short form of contract, impact on small businesses. Given the volume of maintenance work required, tenders are issued to building contractors included on a list in the relevant region or outside Dublin. This current process is beneficial to small business as it has allowed for the inclusion of additional applicants on the current list through application at any time while the list system is in place. This avoids repetitive paperwork and the use of additional resources by small and medium-sized enterprises as only one application for assessment is required. Tenders for each region are distributed on a rotation basis so as to be fair to everyone on the list. There are approximately 225 contractors on the list for building works. I am pleased to be able, through the joint committee, to invite small firms involved in construction to apply for inclusion on the list.

Eligibility is based on turnover levels, relevant insurance, tax compliance, membership of the operative pension and sick pay scheme, health and safety compliance and relevant work experience. On awarding of a contract, a performance bond may also be required. Members will be interested to note that in 2011, just under 1,300 businesses undertook construction related activities, services or works for the Office of Public Works, on which some €160 million was expended. While these figures demonstrate the extent to which firms have access to and provide services for the OPW, they do not account for the number of suppliers to the businesses the OPW procured for the provision of these services.

I thank members for their attention and will do my best to answer any questions they may wish to raise on the eligibility of small firms in tendering for capital works projects in the Office of Public Works.