Brian Cowen (Laois-Offaly, Fianna Fail)

The development of small and medium sized enterprises is very important to the national economy and it is recognised that public procurement can be an important source of business for them. The national public procurement policy unit in the Department of Finance promotes policies which facilitate SME participation in public procurement and the national public procurement operations unit established in 2009 will act as a centre of excellence for the provision of procurement advice and implementation of procurement policy in line with best practice and Government initiatives, including improved access to public procurement opportunities for SMEs.

A number of practical provisions are in place to ensure that SMEs can access public procurement opportunities. These include the existing guidelines to contracting authorities which require that they encourage new businesses to apply for smaller public contracts and establish a track record which can enable them to progress to competing for larger contracts. In establishing frameworks for the supply of goods and services, contracting authorities are asked to consider how proposed arrangements will impact on SMEs. In these situations, while total demand may be aggregated requirements will generally be drawn down in small lots, in many cases following mini competitions. In selecting participants, authorities are asked to ensure that where smaller enterprises can meet requirements or compete for particular lots, the terms of the framework should facilitate their inclusion. It is pointed out that there will be instances where flexibility and an ability to respond speedily to requirements will place such enterprises in a particularly favourable position to participate and compete effectively. Under public procurement rules, pre-qualification criteria must be proportionate and relevant to the needs of the contract. Contracting authorities must be careful to avoid setting unnecessarily high requirements in pre-qualifying tenders for public contracts which may act as a deterrent to SMEs.

The public procurement website, www.etenders.gov.ie, is a national resource available to contracting authorities and suppliers which increases transparency and greatly facilitates access to public sector contracts. While current guidelines require contracting parties to advertise contracts with estimated values of more than €50,000 for supplies and service contracts on this website, this threshold is not absolute and a recent survey showed that some authorities advertised contracts ranging from €10,000 upwards as standard practice. It is generally recognised that advertising of these opportunities promotes SME participation. By registering as a supplier on this site, other facilities are available to potential suppliers, including e-mail alerts to suppliers when notices of interest to them have been published and a facility to secure online submission of tenders by suppliers which can simplify the tendering process and associated expense for smaller suppliers.

Contracting authorities are strongly encouraged to communicate long-term purchasing plans to the market as early as possible by publishing what are known as "prior information notices" on the website. These minimise the barriers for SMEs associated with timelines involved in tendering processes by giving smaller businesses time to react and prepare for the tender process with regard to developing partnerships with other smaller companies and identifying innovative solutions or sub-contracting opportunities with larger companies.

The Buying Innovation ten-step guide, published by the procurement innovation group established by the Department of Enterprise, Trade and Employment, highlights the role that SMEs can play in smart and innovative procurement. Creative ideas for new and innovative solutions and products can come from small and medium enterprises. Contracting authorities can promote their participation by encouraging joint bids from SMEs, affording sub-contracting opportunities or, where appropriate and practical without compromising efficiency and value for money, dividing contracts into lots. Contracting authorities can also encourage new and innovative solutions by indicating in tender documents that they are prepared to accept variants to the specification where appropriate.

For certain requirements, contracting authorities may need access to technical knowledge to research the market for solutions, draw up specifications and evaluate proposals. It is important that contracting authorities consult with the market before tendering as it enables them to understand and identify new developments in the marketplace and what types of companies, including new SMEs, can provide solutions.

SMEs are acknowledged as key suppliers of eco-innovation, as many are engaged in developing and providing specialist and innovative green products and services. Encouraging sub-contracting is an important aspect of securing the best possible solution for contracting authorities. It also benefits larger companies by enabling them to strike up collaborative partnerships with small innovative firms engaged in cutting edge technology. As can be seen, a real effort is being made to ensure that SMEs can participate and be given adequate prior notice.

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