Colm Burke (Fine Gael) | Oireachtas source

I welcome the Minister of State to the House. I wish him well in his new role as Minister of State responsible for public procurement.

In terms of public procurement, it is extremely important we do not have a set of regulations and rules that make it impossible for smaller SMEs to tender for a job, which has happened in some areas. Therefore, we need to look at the process again. I am aware of a case where legal services were provided to a Department but now the process has been centralised. Three years have elapsed and I want to know whether this has saved us money. In the case I refer to, one central body got the work and then subcontracted it to people who provided the service in different areas around the country. Does the group that took over the entire control of the project now take most of the profit thus leaving the smaller companies with a very tight margin? I am concerned about this matter and also about centralising the purchase of equipment by a Department or statutory agency. When purchasing equipment one must consider the necessary support services. I worked in the private sector for a long number of years. During that time I have seen goods sold at a rate way below that of their competitors but the person selling the goods made up the difference with the cost of maintenance and servicing. That is something we need to be careful about when it comes to contracts. In terms of procurement, is an eye kept on instances where the cost of equipment is substantially reduced but the cost of servicing that equipment has increased?

A social development clause is extremely important and is an area in which we need to do a lot more work. I believe that we can do so. Can we make further progress? A lot of companies shy away from social clauses but maybe that is because they have not been properly explained. I note that the Minister of State mentioned that more than 12,000 companies have registered. I still think that there is a lack of information on how to tender for departmental contracts. It is not as difficult as some people think yet some shy away from doing so. It is important that there is a better supply of information and there are equal opportunities to grow a business and tender in a competitive manner.

I wish to mention an area that was raised with us in the past few days even though I know that it does not come within the direct remit of the Minister of State. I refer to the centralisation of the purchase of goods.It is happening in a particular area in one Department and I think the Minister of State is aware of what I am talking about. There is serious concern that many smaller operators will now be pushed out and a feeling that a contract will go to an international company. In the past week, we had a briefing on the education sector, including the purchase of school books. I know this is not in the Minister of State's direct area but people are concerned and this matter needs to be dealt with. I am sure this is happening in other areas also. The information goes out that there is one central contract so many smaller companies then shy away from it. They are concerned that redundancies may follow if this process is to be adopted. I understand this process is being considered for operation in the next three to four weeks. I, therefore, ask the Minister to examine that matter and revert to us on it.