Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

We have made changes for new tenders and new contracts, allowing for indexation of the tender price prior to the awarding of the contract. New contracts provide for mutual cost recovery to allow for recovery by the contractor of inflation above a certain percentage. I acknowledge that the level of inflation being experienced in construction is placing real pressure on contractors conducting live contracts because of the fixed-price nature. I have asked my officials in the Office of Government Procurement and the national investment office to examine the issue in detail. They have consulted the major capital spending Departments and bodies. I am engaging actively with them. I need to strike a balance. I must ensure that taking up public works contracts remains a viable proposition for contractors. I accept that principle. On the other hand, I have a duty to taxpayers to ensure that our large capital budget this year goes as far as it possibly can in the delivery of the NDP. The issue is under active consideration. I recognise the pressures and will bring some proposals shortly.

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