Feargal Quinn (Independent)

My enthusiasm for adjudication came about when I learned of the British figures. In 1998 the United Kingdom introduced this form of adjudication. While my figures may be a few months out of date, more than 20,000 disputes in construction have occurred in the past 12 years with fewer than 400 going to court. They went to adjudication and the adjudicator's decision was accepted by all but 400 who ended up in court. That is a speedy resolution which seems to be accepted and which we sought. The intention would be to follow that same method of resolving disputes. Fewer than 2% of the 20,000 disputes ending up in court represents a great success. While that adjudication process did not stop anyone who was unhappy with it going to court and going to an arbitrator later to find some other solution afterwards, it meant they were paid there and then, which resolved the issue. People very quickly began to see that the adjudicators' views seemed to be accepted by the courts because they were seen to have done a competent job.

The rationale underpinning the arrangements is as follows. The decision of the adjudicator is not binding if the payment dispute is referred to arbitration or other legal proceedings. This has only come in very recently and is one that differs from the British system. The rationale underpinning the arrangements is connected with the position of the State on public sector contracts as the Minister of State said. For example, if the State were unhappy with the outcome of an adjudication and decided to refer the dispute onwards for resolution in arbitration or in the courts, it would not be a prudent use of Exchequer funds to pay over the adjudication award upfront, given the risk that it might not be possible to recover the amount at a later date should the arbitration or court proceedings find in favour of the State party. If the State had to pay out on the basis of an adjudicator's decision and was not able to get that money back when it turned out it won the case in court, the taxpayer would be at a loss. That is why the Department of Finance believes it is imperative this provision be included.

We would love to find a different way to be able to resolve this. Having adjudication only would be the solution were it not for that particular problem. That is why the Department of Finance believes it is necessary to have this provision. That sounds as though I am sheltering behind the Department of Finance - perhaps I am. I believe the adjudication system is a great system that has worked very well in Britain and other countries. There is a danger that because it is not binding, if the payment dispute is referred to arbitration, it could weaken it.

I hope the Bill will pass through the Seanad today. It will have two other stages to complete, one of which is the regulatory impact analysis and the other is to be passed by the Dáil. The cases Senators have made today will be considered in both those arenas. In the case of the Dáil it is worth making the case because there may be a better solution than that proposed in this legislation today.