Mr. Paul Quinn:

I thank the Deputy for her questions. To add to what the Secretary General said, the committee will be aware that after our meeting last year in April 2014, the Minister, Deputy Howlin, and the then Minister of State, Deputy Brian Hayes, issued a new guidance circular to the public sector around covering quite a degree of policy guidance for people on the issues we are discussing. In particular, it requests people to do their market analysis, to understand the impact of their actions on those individual markets in order to make sure that whatever we take we sustain competition in the various markets. Not all markets are equal. Markets in the cleaning sector are very much locally delivered while, on the other end of the scale, markets in the energy sector are nationally delivered. The actions and the strategies procurers have to take are fundamentally different. Breaking contracts down into lots is very much a core element of that. We have also reminded public procurers that value for money is not simply around price, it must balance the quality, overall life-cycle costs and the terms and conditions. Providers who are prepared to stand behind their offerings and underwrite risk for the State is also a key part of determining value for money.

The Deputy referred to the report. As she recognised, a great deal of work was involved in bringing that report to the table. It has taken 16 months of gathering data from various public sector bodies. She was right in saying it is not a 100% sample. I can be clear in saying it will never be a 100% sample because some of the State bodies from which we have to collect data are literally one-room schools dotted around the country from which we will never be able to get that information.

We may be able to sample. Our intention is to reach a sample size of 80% to 85% of overall public expenditure. In the report we have been able to produce in the past week is 63% of the estimated public expenditure of €6 billion on goods and services for 2013. It is a very large sample, and we believe it is representative because it looks not only at large organisations such as hospitals but also covers smaller organisations in education and local government. It also covers organisations which are regionally based.

We spoke about regionalisation, and procurement can be broken down into lots. Where appropriate, regional lots will be offered in the market. It is down to the procurers to decide what is the appropriate strategy to deliver value for money for the taxpayer. A prime example might be that every post office in the country would like if public bodies were to buy stamps there, but this would not be an efficient way for the State to buy its postal services. We aggregate up the relationship we have with An Post, and the cost of delivering postal services for large Departments is done at national level and not by going to the local post office to buy a book of stamps which would be inefficient from a State perspective. We must be very mindful of value for money.

Some of the push back we sense in certain sectors is driven simply by a lack of procurement in the first place. It is not about aggregation in all cases. The committee has come across in its deliberations quite a number of public bodies with an absence of procurement activities, let alone good procurement. It is not surprising in one sense that as we look into certain markets long-standing relationships which have existed between suppliers and State agencies are being put to the test. Ultimately this is at the need of the taxpayer, because simple direct relationships with suppliers without any competition do not deliver value for money for the taxpayer.