Pat Gallagher (Donegal South West, Fianna Fail)

The insertion of a provision restricting agreements under this section to fixed charge agreements is unnecessarily restrictive and pre-empts any ongoing development in public procurement policy. The purpose of this section is to enable a water services authority to enter into an agreement with a person to provide water services infrastructure with a view to that person subsequently transferring ownership of it to the water services authority.

While I understand Senators Bannon and McCarthy's concerns about control of costs, such control is best exercised within the framework of current public procurement policy. Inclusion of a requirement for fixed cost agreements in subsection (2) may lead ultimately to a lack of synchronisation between this provision and public procurement policy. Fixed cost agreements may not necessarily be the best solution in all cases and it is best that water services authorities be guided by ongoing public procurement policy rather than be restricted to a particular course of action by this Bill.

Members will be aware there are strict rules governing public procurement, including EU requirements. If there are to be fixed costs it may be that we would not have the element of competition. Having fixed costs does not necessarily mean the taxpayer may benefit. Supply and demand will dictate things. Members may be aware it is not necessarily the lowest costs but, all things being equal, the lowest tender that will get the contract. The regulations on contract documents have to be in order and I am a great believer in the provision of public procurement policy.

As for vigilance, one does not necessarily have to have a Government in power to be vigilant. All the tenders are there for members to see, and members witness the opening of tenders to ensure nothing is slipped into the box subsequently. I do not appreciate, therefore, the reference to cronyism. I have spent 25 years in public life and I do not believe I have ever come across a situation whereby a tender was selected on any basis other than on that which was best for the local authority, the water services or the taxpayers' interest. If we were to introduce fixed charges we might find many contractors would not be interested or that only a small group would be interested, which could lead to an escalation rather than a reduction of costs.