Joe McHugh (Donegal North East, Fine Gael)

I propose to share time with Deputy Anthony Lawlor. The introduction of the Construction Contracts Bill is a welcome move and I congratulate the Minister, Deputy Howlin, for showing leadership on this issue. It is also within the brief of the Minister of State, Deputy Brian Hayes, and affects a range of Departments. Unfortunately, the Bill is not retrospective because that would open up a can of worms. Many small companies have been burnt by bigger contractors leading to the use of terms like subbie busters to describe large contractors. In advance of large contractors being awarded contracts, people on the ground knew the companies would go bust yet they were still awarded contracts. That is an unmitigated, unacceptable and inexplicable disaster. So many small companies went to the wall despite people working hard and investing their time, energy and finance into what were mainly Government projects. The extension to Letterkenny General Hospital is a case in point. It is a fine building and will be opened this year. Its history will leave a sour taste in many people's mouths because so many small contractors got burnt in that scheme. After Michael McNamara & Company got into trouble, I spoke to people in Government at an official level and they were aware there would be difficulties prior to the contract being awarded. Small contractors and people on the ground in Donegal knew they were entering into a contract that would later be in jeopardy. Specific elements in the Bill allow for staged payments and making clear when payments become due, their amount and final date of payment are badly needed.

Citizens of this State are living in Australia. I have one company in mind, although I will not mention the name of the individual. He moved from Donegal to Australia because he could not keep his company going. He is owed money and he was burnt, which is morally wrong. We must pass legislation so that it does not happen again. I am a realist and companies will go bust even if they have ticked all the boxes by providing a bond, meeting the turnover requirement and have dotted the i's and crossed the t's. We cannot legislate for all eventualities but we should instil a sense of confidence in smaller contractors. Big companies, such as Sisk, have been subcontracting work for years and will continue to do so. We must ensure we protect smaller companies.

Our rules of procurement must be seriously considered. The Minister of State is looking at them thoroughly. We have so many good companies in this country that have tried to get onto the tender list for Government projects but cannot because they do not satisfy the minimum turnover threshold of €2 million. There are many good companies with a great track record, employing ten to 30 employees and they are still in business despite the difficult and tight times but they cannot get on the tender list because they do not satisfy that minimum threshold of €2 million. It is ridiculous. Companies should be considered on the basis of their competence. There has to be scale of competence and of past work done, both government and private sector work. Such companies have completed excellent projects for €500,000 or €1 million but they are struggling to survive. We should be giving them a lift up because they will be the people who will help economic recovery as opposed to bigger companies. They will continue to deliver an excellent building product.

The construction sector has been viewed in a negative light. I agree that the construction bubble wrecked this country but at the same time there are very good small companies who are working to survive. We must provide the proper environment for these companies to survive. They are not making big profits but they want to survive. These small companies have a moral responsibility to their workers and they want to keep them in work.

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