Tommy Broughan (Dublin North East, Independent)
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73. To ask the Minister for Communications, Energy and Natural Resources if he will report to Dáil Éireann on his response to ongoing public concern regarding the escalating costs and the tendering process for Eircode; and if he will make a statement on the matter. [38989/15]

Tommy Broughan (Dublin North East, Independent)
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Last July the Minister launched the Eircode identification system at a cost, it was said, of €27 million. We have since found out from the report to the Committee of Public Accounts by the Comptroller and Auditor General that the cost now stands at approximately €38 million. It is generally agreed that the system will cost at least €50 million but the real question is whether it is a good system. Is the Minister potentially leaving a complete white elephant behind him in the Department, a system that will be unusable? It seems that our emergency services, An Post, commercial suppliers and many others are still using traditional addresses. How many people are using the Eircode system now?

Alex White (Dublin South, Labour)
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The cost of the contract with Capita, which was awarded a ten year licence to develop and maintain the post code system, is €27 million excluding VAT or €33.2 million including VAT. This position has not changed since I last reported on the cost of the contract and covers the design of the Eircode, encoding public sector databases, accessing the GeoDirectory database, the launch and implementation of Eircodes and the ongoing management of the system for the licence period.

The total spend to date on the post codes project amounts to €19.5 million, including VAT. Of this, Capita has been paid €17.5 million on foot of delivery of agreed milestones. The bulk of this figure, €11.5 million, was spent on encoding public sector bodies' databases. Apart from payments to Capita, €2 million has been spent on specialist costs arising in the period from 2009 to date.

My Department commenced the procurement process for the national postcode system in 2011. An open and competitive procurement process was conducted in accordance with Department of Finance and European Union procurement frameworks. My Department received correspondence from the European Commission in 2012 regarding certain aspects of the procurement process. In 2013, the Commission informed the Department that the matter had been closed on the basis that it could not establish any breach of EU procurement law that would justify the opening of an infringement procedure.

Subsequently, the Commission requested that certain measures be adopted by Ireland regarding the clarity of language to be used in future procurements. My Department responded to this request after consulting the Office of Government Procurement. In recent correspondence, the Commission confirmed that there are no grounds for reopening an investigation into this matter, which it now regards as closed.

Tommy Broughan (Dublin North East, Independent)
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Is it the case that the EU procurement unit found the tendering process for at least three major contracts to be highly irregular and faulty? It is highly unusual for the Comptroller and Auditor General to criticise a public sector contract as severely as he did in the case of the postcode contract. I was astonished to read an article in the Sunday Independentrecently by the distinguished journalist Eoghan Harris in which he described what appears to be a very poor tendering process for the postcode contract. He refers, for example, to Mr. Gary Delaney, who developed the Loc8 code, a satellite-navigation-based postcode system that he was prepared to give to the Government and the Northern Ireland Executive free of charge. In Mr. Delaney's view, smaller companies were grossly discriminated against in the tendering process. For example, bidding companies were required to have an annual turnover of €40 million. I am aware of similar requirements in other areas of Government procurement. Why was Mr. Delaney's innovative and free postcode system not considered? Why did we end up with such an expense? As I stated, the tendering process for the postcode system has been severely criticised. I note also that the Department awarded at least two consultancy contracts without any tendering process.

It was reported recently that 87% of people know their Eircodes. Does the Minister know his Eircode?

Michael Kitt (Galway East, Fianna Fail)
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We are over time. I must call the Minister.

Tommy Broughan (Dublin North East, Independent)
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My Eircode is D13 TX82. However, I do not use it, and I am not aware of many people who use their Eircodes.

Alex White (Dublin South, Labour)
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To return the favour to Deputy Broughan, my Eircode is D6W WN99.

On the procurement issue, Deputies will understand that I was not the Minister during the procurement process. I am perfectly happy to report to the House on precisely what occurred, however. I outlined the position regarding the complaint submitted to the European Commission, which it subsequently investigated. On foot of the complaint, the Commission contacted the Department on certain aspects of the procurement process and the issues were addressed in correspondence with the Commission. The complaint was not upheld and the Commission has confirmed that the file on the complaint was closed in 2014.

It is important to stress that this was a pilot complaint and not a formal infringement under the EU treaties. The Commission did not give any indication that the tendering process was invalid. The European Commissioner for Internal Market and Services advised in 2014 that the Commission department "could not establish any violation of EU public procurement law that would justify the opening of an infringement procedure."

Tommy Broughan (Dublin North East, Independent)
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Use of the Eircode has been optional since it came into operation in July. Is the Minister concerned that only a small number of bodies, including commercial entities, are utilising the postcode system? Is the reason for the low take-up the random nature of the system selected? The Minister and I both referred to our Eircodes. It is striking that the numbering system in housing estates and townlands in rural areas is random. This seems to be one of the reasons that emergency bodies, for example, do not use Eircodes. Is it a case that we should not have done this at all, that given we are in the e-mail era we should have waited a little longer and utilised GPS, sat. nav., Google Maps and so on, which would have been much simpler and which would have saved the country €50 million?

Alex White (Dublin South, Labour)
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The National Ambulance Service is already constructing a new computer-aided dispatch system to use Eircodes and it will be deployed in its new state-of-the-art national call centre. The licensing terms are being finalised between GeoDirectory and the service, which will facilitate the inclusion of Eircodes in its database before the end of the year. The service has welcomed the introduction of Eircodes as they will facilitate the speedier deployment of ambulances.

There are now 21 value-added resellers registered with Eircode and they will provide a variety of services including database cleansing, address look-up and geocoding. One can see a full list on the Eircode website. Some residual licensing issues are being finalised between the postcode contractor and GeoDirectory, which will facilitate the inclusion of Eircodes in commercial databases. Similarly, with respect to sat nav and similar technologies, deployment will take place in early course. The licensing arrangements are being finalised and I expect to see that occur in the coming weeks.

Michael Kitt (Galway East, Fianna Fail)
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We must move on to the next question.

Michael Colreavy (Sligo-North Leitrim, Sinn Fein)
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Sorry-----

Michael Kitt (Galway East, Fianna Fail)
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I am sorry, Deputy, but we are well over time and the Deputy's own question is next.