Mick Barry (Cork North Central, Anti-Austerity Alliance) | Oireachtas source

For us procurement represents privatisation through the back door. Services that could be and should be delivered with direct labour employed by public bodies with trade union rates of pay and conditions are being shifted via procurement in many cases to precarious private sector employment.

Ireland is a leading country in PPPs and outsourcing. The most definitive report on this was Public Capital Investment and Public Private Partnerships in Ireland 2000-2014: A Review of the Issues and Performance by Eoin Reeves. That report states: "In international terms, Ireland is ranked among the countries with the most extensive use of the PPP model for procuring infrastructure". It stated that Ireland has been ranked "with countries such as Greece, South Africa and the United Kingdom where PPP accounts for between 5-10 per cent of the total investment in public infrastructure." It goes on to state that PPPs accounted for "7.6 per cent of spending under the Public Capital Programme over the period 2002-2013". I understand that 80% of this was for motorways.

Outsourcing is extremely inefficient. Using direct labour would cut out time wasted on the tendering and procurement process. The Reeves report states:

This slow rate of project completion was attributable to a number of factors including the relatively complex procurement process that applies under PPP. Reeves et al (2013) estimated that the average tendering period for Irish PPPs has been 34 months with durations ranging from 22 months (social housing) to 58 months (waste to energy). These lengthy tendering periods, which are similar to those observed in the UK, highlight some of the challenges that arise in implementing an extensive PPP programme. Lengthy tendering periods increase transaction costs and reduce the scope for achieving value for money...

Very little independent cost-benefit analysis has been carried out on PPPs but one in-depth analysis of a school's building PPP by the Comptroller and Auditor General estimated that the PPP worked out at 8% to 13% more expensive than under traditional procurement. Factored into the contracts are the profit margins for the private companies. This is a direct transfer of public funds into private hands.

Procurement is increasing the level of low pay in society and widening the gender pay gap. Outsourced public services have considerably worse terms and conditions for their workers than direct public sector employment. CSO statistics show that employment has increased in health care while public sector health-care employment has fallen. We have seen the outsourcing of home support workers to private firms that pay minimum wage and privatisation of nursing homes.

The Bill does not go far enough in broadening the conditions that can be stipulated when the State is tendering for contracts. We far prefer the type of outlook that was summed up in the submission to the Government by the Irish Congress of Trade Unions on the transposition of EU legislation in 2016. It called for certain mandatory conditions to be put into the legislation regarding workers' rights, including compliance with health and safety; collective bargaining rights; the ending of mandatory price-only and cost-only assessments; and mandatory payment of a living wage. We would go further and call for all workers employed through public procurement to be on the same pay and conditions as those in the public body outsourcing the work. The ICTU also requested that there be regard to the impact on local employment, employment of people with disabilities, disadvantaged people, etc. Companies or their beneficial owners that have a track regard of breaching workers' rights, environmental standards, health and safety standards etc. should be barred from procurement contracts.

The ICTU focussed in some detail on the issue of tax compliance. There are many companies with public contracts headquartered in offshore tax havens which are used to avoid tax and transparency in terms of their ownership and profits and to avail of laxer reporting requirements.

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