Martin Ferris (Kerry North-West Limerick, Sinn Fein)
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There is serious concern regarding the awarding of the contract for rail maintenance to a British company, Balfour Beatty, which has also been awarded the €400 million contract for maintenance of the Bord Gáis grid. The reason for this concern, other than the fact that jobs will be lost among Irish contractors, is the company's poor safety record.

Most of this record relates to incidents on the British railway system, including the derailing of a train on a section of line laid by the company. In 2006 Balfour Beatty was fined GB £7.5 million after a train crash which cost four lives and caused 100 injuries on a section of line maintained by the company. In 2007 it was fined GB £180,000 following the fatal electrocution of one of its line maintenance workers. The company also has a rather colourful history in terms of securing contracts. In 2008, for example, it was fined GB £2.25 million when the Serious Fraud Office found it guilty of false accounting. In 2009 it was fined GB £5.2 million by the Office of Fair Trading for corrupt practices in securing construction contracts.

In the light of all this, can the Minister or the public be satisfied that the railway system will be in safe hands? Surely the company's record ought to have been taken into consideration before these contracts were awarded? There is also the worrying development that all of the major contracts for such work within State companies are apparently being awarded to overseas companies. In this instance, the company in question has secured lucrative contracts with Bord Gáis and larnród Éireann, while the contract for line maintenance within the ESB is also being tendered abroad. How does this sit with the Government's target of creating indigenous employment? Irish companies and Irish workers will be considerably impacted by the loss of this work, despite having delivered such contracts to a consistently high standard over the years. That record stands in contrast to the standards of the company in question.

Will the Minister confirm the belief among Irish companies that there is an obligation on public bodies to seek tenders from within the EU? Given the state of the economy and the need to generate employment, there surely ought to be an obligation, particularly on the part of State companies, to ensure such contracts go to Irish companies, which have an established track record in this type of work. I am seriously concerned about awarding this contract to Balfour Beatty given its track record and appearances and convictions before the courts. From a security point of view, given its convictions for fraud and malpractice, this is a dangerous precedent for any Government to set.

Fergus O'Dowd (Louth, Fine Gael)
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I am taking this matter on behalf of the Minister for Transport, Tourism and Sport, Deputy Varadkar, who is unavoidably absent. I thank Deputy Ferris for raising this issue. I was not aware until now of the information which the Deputy has just put into the public domain. Perhaps he will provide me with a copy of it.

As the Deputy will be aware, the Minister for Transport, Tourism and Sport, Deputy Varadkar, does not have an operational role in larnród Éireann nor does he make decisions on awarding of contracts by the company. This is a matter for larnród Éireann and its parent, CIE, in accordance with their procurement policies. The Minister understands from larnród Éireann that on 20 February 2010 a procurement process was advertised in the Official Journal of the European Union seeking expressions of interest from economic operators in a procurement competition intended to lead to the award of a contract to operate and maintain the On Track Machines, OTM, fleet. A procurement evaluation panel, which consisted of suitably qualified and experienced larnród Éireann infrastructure managers, determined which was the most economically advantageous tender having regard to the award criteria. On the basis of the decision of the procurement evaluation panel, approval from the board of larnród Éireann and the board of CIE was sought to conclude negotiations and to award a contract to the preferred bidder, in accordance with CIE Group procurement policies and procedures. The decision was approved by the board of larnród Éireann on 25 October 2011 and by the CIE board on 3 November 2011.

The participants in the tender process were advised on 9 November 2011 of the decision reached in regard to the award of contract, in accordance with the requirements of SI 131/2010 European Communities (Award of Contracts by Utility Undertakings) (Review Procedures) Regulations 2010. Under the Railway Safety Act 2005 and EU Directives, the Railway Safety Commission, RSC, is responsible for the regulation of railway safety in Ireland and ensures compliance with EU obligations. In accordance with provisions of the Act, the primary duty of care for the safety of the railways rests with the railway undertaking and its management and staff. On works on the railway, larnród Éireann ensures that all such operations comply with overall safety requirements and standards.

The Minister has been informed by the Railway Safety Commission that the activities of any OTM operator-maintainer, including movements over the larnród Éireann network between depot and work site, are subject to safety certification by it based on assessment and acceptance of a safety management system that fully complies with EU regulations.

Martin Ferris (Kerry North-West Limerick, Sinn Fein)
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I thank the Minister of State for his reply. I will forward the information I have to his office. I previously raised this matter in the House with the Minister, Deputy Varadkar, when I was sure all of this information was available. The Minister of State, Deputy O'Dowd, stated that the Minister for Transport, Tourism and Sport has no operational role in awarding contracts. In light of the information I brought to the House last week and again today, will the Government revisit contracts that have been awarded in terms of safety, including the colourful history of the company that secured this contract?

The company concerned was fined £7.5 million following a train crash on a section of line it had maintained, resulting in the loss of four lives and 100 injuries. It was also fined £2.2 million by the Serious Fraud Office and £5.2 million by the Office of Fair Trading for corrupt practices in securing construction contracts. This is worrying. I understand these convictions are on public record. I will forward the information to the Minister of State's office. I hope it will be looked at and that the Government will revisit the terms of contracts and will investigate whether this information was disclosed by the company concerned.

Many Irish companies with good track records in terms of safety and so on are unable to procure employment. Given the current economic climate here, with so many people unemployed and more people regularly joining the dole queues, there is an obligation on the Government and everyone else here to ensure that, where possible, there is positive discrimination of Irish companies.

Fergus O'Dowd (Louth, Fine Gael)
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During my time as Opposition spokesperson on transport, CIE and Iarnród Éireann were regularly invited to committees to discuss issues like this. Following receipt of the information from Deputy Ferris, I will ensure it is given to the Minister and will ask that it be forwarded to the board of CIE. The key point is that the Minister for Transports, Tourism and Sport has no role in deciding where contacts are awarded. That is the function of the boards of CIE and Iarnród Éireann. The Deputy has rightly raised the question of whether they were aware of the facts outlined and if so, what implications, if any, this might have in terms of the legal awarding of the contract to the successful bidder.

Six expressions of interest were obtained from the initial advertisement. Following a pre-qualification process, four entities were invited to submit tenders. Three tender submissions were received. larnród Éireann determined that it wished to award a single contract encompassing operation and maintenance services. As one of the tender submissions related to maintenance services only, this tender was not considered for the purposes of awarding the contract. Following initial tender submissions in September 2010, the tender evaluation process entailed four rounds of discussions with the two companies competing for operation and maintenance of the contract. Negotiations in this regard concluded in September 2011.

The contract award criteria for the purposes of the tender evaluation comprised 65% cost, 30% methodology for provision of services under the contract and 5% start-up time. A procurement evaluation panel, which consisted of suitably qualified and experienced larnród Éireann infrastructure managers, determined which tender submitted the most economically advantageous tender having regard to the award criteria.

The issues the Deputy brought to my attention will be brought to the attention of the Minister, Deputy Varadkar, and the company concerned. I suggest to the Deputy that, as the Minister has no role in awarding contracts, he, as a member of the transport committee should, as a matter of urgency, ensure Iarnród Éireann is called to attend before that committee to urgently discuss these issues, at which point he can seek all information to which he is entitled.

The Railway Safety Commission is the regulator in this area. I have no doubt it will ensure that any activity carried out for and on behalf of Iarnród Éireann will meet all safety requirements.