Hildegarde Naughton (Galway West, Fine Gael) | Oireachtas source

I welcome this opportunity to discuss the next Coast Guard aviation contract and to clarify a number of matters raised by Members in the motion they have tabled. As has been stated by other colleagues, I am constrained by procurement law in publicly discussing matters relating to a live procurement process. For this reason, I will not be in a position today to disclose any information relating to the procurement specifications or anything that is commercially sensitive or integral to the process. In any event information regarding the procurement process must be directed to prospective candidates through eTenders.

I also completely reject any suggestion that civil servants have set out to deliberately defraud the State and the taxpayer. The Government is acutely aware that all major procurement projects must be managed in a compliant manner and, to that end, safeguards are in place to ensure the process is undertaken in conformity with procurement law.

A representative of the Office of the Chief State Solicitor is a member of the Department's project team, and a procurement process auditor has been appointed with the express task of providing assurance to the Secretary General, as Accounting Officer, as to the conduct of the procurement process. The Government's amendment provides an accurate reflection of the current position, while also observing the communication constraints, and the need to safeguard the integrity of the overall procurement process.

There is one important point that we can all agree on. The provision of an effective maritime search and rescue service is critical to Ireland as an island nation with a strong maritime sector.The sector depends on the reliability and professionalism of the Irish Coast Guard and all its component parts, including the Coast Guard aviation service, to offer a service that can deploy at a moment's notice to rescue people in distress and bring them to a place of safety. The Irish Coast Guard has a distinguished record in delivering search and rescue services and a wide range of other essential aviation services for many decades, including the co-ordination and management, as appropriate, of aviation services delivered by the Air Corps and civil operators. The aviation service contract allows the Coast Guard meet its obligations as prescribed in the national search and rescue plan, the national maritime oil and HNS contingency plan, and its capacity to support other State agencies, in particular inland search and rescue, SAR, support to An Garda Síochána and the provision of air ambulance services to the HSE, including day and night support to our island communities.

The current Coast Guard aviation service contract is due to expire in 2024 and the procurement process for the next contract is now well under way. There is no basis to support calls for the Government to suspend or further delay the process. Furthermore, if the procurement process does not continue, then the Government will be in breach of public procurement law when the current contract expires. Moreover, lives could be put at risk if Government allows the current contract to expire without a replacement contractor being appointed.

The business case will not be published as it contains information which, as highlighted by colleagues, is commercially sensitive or could prejudice the outcome of the procurement process. However, details of the business case are available as part of the information documentation for the procurement. It is a requirement that all tender competitions must be competitive. The greater the level of competition, the higher the likelihood of a fit-for-purpose and affordable outcome. It makes no sense, therefore, that the contracting authority should reveal its entire cost, risk and operational strategies in the tender documents or through the release of the business case or subsequent analysis of fixed-wing proposals. Publishing the business case would not only jeopardise the integrity of the process but also tie our evaluators' hands in striking the best deal possible for the Coast Guard and the taxpayer.

I would like to update the House on the procurement process. In November 2019, the Department of Transport commenced a process to prepare for the next iteration of the Coast Guard aviation service in line with the public spending code. An initial strategic assessment and preliminary appraisal report was prepared by the Department and brought to Government by the then Minister for Transport, Tourism and Sport in July 2020, following approval by the steering group. This report included a strategic assessment setting out the context for the Coast Guard aviation programme, an organisational overview, and a survey of existing policies and strategies relevant to the programme. The report took on board key learnings from the existing service and contractual arrangements. It identified the spending objectives of the programme, including existing arrangements and relevant business needs. It also included an appraisal of various service delivery options, including the State assuming full responsibility for the service either through the Air Corps or a dedicated Irish Coast Guard aviation branch. Both were ruled out for a variety of reasons, including the significant challenges of establishing such a service before the current contract expires and the level of risk that would be assumed by the State.

The process then moved to detailed appraisal and business case stage. A multi-criteria analysis was used to determine the shortlist of options for consideration on the basis of five criteria: deliverability and implementation, integration and interface, market interest and operator capacity, operator capability and enhancement of State aviation emergency capacity. A detailed financial and economic appraisal of the shortlisted options was also conducted. The detailed appraisal provided a framework to assess costs, benefits, affordability, deliverability, risks and sensitivities associated with the shortlisted options to guide the approving authority through gate 1 of the public spending code to the planning and design stage. While it was acknowledged in the preliminary report that the Air Corps would not be in a position to take full responsibility for the service, the Department of Transport agreed to explore the viability of the Air Corps providing some element of the SAR aviation service at the request of the Department of Defence as part of this phase. The Air Corps proposal received in March 2021 was considered in the business case as part of a so-called hybrid option whereby the Air Corps would provide one helicopter base with a fixed-wing component, which would then require a civil operator to provide the remaining element to meet the specification for the national service.

The business case analysis demonstrated, among other things, that there is an inherent cost implication in splitting the helicopter service between two or more providers. The single provider option can achieve economies of scale and address availability requirements more cost effectively. There is flexibility in how the fixed-wing element, which would be a new element of the service, could be provisioned. The service scoped, costed and recommended in the business case is similar in many respects to the current service but would include a dedicated fixed-wing element. This would provide the Irish Coast Guard with an on-call marine environment monitoring and high endurance search and top cover capability. It also has the potential to allow a more innovative helicopter fleet. The strategic research and analysis division within the Department of Transport conducted a technical assessment of the appraisal that determined its compliance with the public spending code.

Stakeholder engagement, including market interest engagement, has been extensive. The steering group includes representation from all relevant Departments and agencies, including the Departments of Transport, Health, Public Expenditure and Reform, and Defence, and agencies such as the HSE, the National Ambulance Service, An Garda Síochána, and the Irish Aviation Authority. There was also extensive consultation across the search and rescue domain, including the many voluntary organisations involved.

On 27 July 2021, the Government approved the detailed appraisal and business case for the next Coast Guard aviation service and agreed to proceed to the planning and design stage, including the procurement of the service outlined in the business case. It also agreed that the Department of Defence, working in conjunction with the Irish Coast Guard, would examine whether the fixed-wing element of the proposed service could be delivered by the Air Corps in line with the requirements and parameters set out in the business case and would provide the Department of Transport with a costed proposal by October, which would then determine whether this aspect of the new service could be provisioned by the Air Corps or should be procured as part of the procurement plan described in the business case.

On 3 December 2021, the Government noted proposals to allow the possibility of Air Corps involvement within a reasonably short number of years. The review of the Air Corps' capability to provide the fixed-wing element concluded that the proposal, as framed, would represent a significant expansion of Air Corps capacity beyond that envisaged at the time of the Government decision of 27 July. However, it was agreed that the next Coast Guard aviation services contract will provide that the fixed-wing element will cease on the third anniversary of the commencement of the services contract in the event the Air Corps is in a position to provide the fixed-wing element. This will allow for the Irish Air Corps to provide the fixed-wing element of the service if and when it has capacity to provide the specified level of service. This provision is reflected in the procurement documents.

On foot of a decision taken by Government last week, my Department has notified the market of an amendment to a pre-qualification questionnaire, which was published by the Department on 20 December 2021. The questionnaire is amended to specify the number and location of helicopter bases to reflect the existing configuration, namely, four bases at Dublin, Shannon, Sligo and Waterford. The amendment will ensure the delivery of wider Government policies concerning balanced and even distribution of State services and investment, particularly the needs of island and rural communities. It will also support and protect other public policy priorities, such as the State's response to emerging trade patterns post Brexit and priorities under the climate action plan.

I thank Senators for tabling this motion today and for providing me with an opportunity to discuss what is a most important issue. However, I cannot agree to calls for the suspension of this procurement process or for the release of commercially sensitive information that is central to the integrity of the competition. I reject the motion on behalf of the Government. I have proposed a countermotion and call on the House to support it.